2 The


Issue 2 2017 - Freight Business Journal Faster trade deal comes into force


The World Trade Organisation’s Trade Facilitation Agreement (TFA) came into force on 22 February aſter it was ratified by two-thirds of its members. Rwanda, Oman, Chad and Jordan submitted their acceptance, bringing the total number of ratifications over the required two thirds threshold of 110.


agreement aims to


speed up movement, release and clearance of goods across borders, and, when fully implemented, could reduce costs of international transactions by an average of 14.3%, but with even bigger savings for developing countries, says WTO. The TFA also aims to cut the time needed to import goods by over a day and a half and to export goods by almost two days, respectively a reduction of 47% and 91% over current average times. TFA is also expected to


help new firms export for the first time and increase the range of products exported by


developing countries. WTO director-general Roberto


Azevêdo described TFA as the biggest reform of global trade in a generation. Developing and least-


developed countries will be allowed to set their own timetables for implementing it, while developed countries have committed to immediately implement the Agreement, which sets out a broad series of trade facilitation reforms. Spread out over 12 articles, the TFA prescribes measures to improve transparency and predictability of trading across borders and to create a less discriminatory business environment. These include improving the availability of information about cross-border procedures and practices, improved appeal rights for traders, reduced fees and formalities for the import/ export of goods, faster clearance procedures and enhanced conditions for transit goods. It also contains measures for


effective cooperation between customs and other authorities on trade facilitation and customs compliance issues. The news was welcomed by


BIFA director general Robert Keen, although he warned that it could be a high-water mark in the history of trade liberalisation. He said: “This agreement aims to simplify and clarify international import and export procedures, customs formalities and transit requirements. It should make trade-related administration easier and less costly, thus helping to provide an important and much needed boost to global economic growth. “If better border procedures


and faster, smoother trade flows result from the agreement and help to revitalise global trade, BIFA members, which facilitate much of the UK’s visible trade, will benefit.” However, he also said: “Of


course, of late, some nations have made it clear that they intend to scale down multi


Chance for forwarders to step up to the plate


FIATA’s customs affairs institute chairman Steve Morris particularly applauded the moves under TFA to set up National Committees on Trade Facilitation (NCTFs) under Article 23.2. This, he told FBJ “would give the private sector a seat at the table for the first time ever.” He added; “Freight forwarders


are the architects of international trade, and it is they who run into the majority of these barriers.” Some countries had already moved quickly to set up NCTFs, in


advance of the TFA coming into force. Interestingly, these tended to be developing countries, and included Kenya, Ghana


and


Jamaica. The TFA is not prescriptive in


terms of who should sit on the new NCTFs, although in most cases the national forwarders’ association would probably represent the industry. However, it would be open to committees to invite individual companies where their specific expertise was


needed, Steve Morris


New standards for customs brokers


The Pan European Network of Customs Brokers and Customs Representatives CONFIAD and CLECAT have welcomed the publication of the CEN Standard of Customs Competency for Customs


Representatives, financed by the two associations. The standard has been developed in line with European Standardisation Organization CENrules and will support customs representation services offered by any


suggested. Steve Morris said he hoped


that countries would send their “brightest and best” people to sit on the new committees and that national associations would put pressure on trade ministers or even prime ministers where there was evidence of foot-dragging by national governments. Despite some of the protectionist rhetoric coming out of Washington and elsewhere, it was important that countries paid “more than lip service” to the TFA, he argued.


customs representative in an EU Member State where they are not established. It will also seek to enhance the quality of services offered by Customs Representatives in the European Union. Each national standardization


body will now need to prepare and finalise their own publication of the standard.


CMA signs second Alibaba deal


CMA CGM has become the second shipping line to sign a deal with Asian online retailer Alibaba. A memorandum of understanding drawn up in Hangzhou will seek cooperation between the two companies, with online booking of


shipping space available to Alibaba users via the retailer’s OneTouch trade facilitation platform. They will offer a direct booking platform for customers for shipments from China to the Mediterranean and on the CMA CGM MEX1 and CMA CGM


BEX services to ports including Barcelona, Valencia, Rijeka, Koper, Trieste and Venice. The move follows a deal by


Maersk Line for online booking for Alibaba’s Chinese customers in December.


country free trade deals and switch to bilateral relationships, marking a return to the bad old days of protectionism. “BIFA believes that the world has benefited immeasurably from liberalised trade. Not only has consumer choice been enriched in many countries, but


also out-sourcing of


production has brought valuable employment to developing economies throughout the world.


BIFA members have


worked to bring these products to the UK and taken UK production to customers abroad.” FIATA’s customs affairs


institute chairman, Steve Morris, applauded TFA as “a great achievement for the WTO and the international trading community.” He said that the international forwarders’ association and its members in 160 countries stood ready to play its part in its implementation and collaborate with all governments as necessary. The UK’s International Trade


>> 1


operational back up to each other and


reduce the risk of delays to the supply chain - no other operator in the UK can do this.” UK managing director, DP World


and chief executive of DP World London Gateway, Chris Lewis, said: “For three years, DP World London Gateway has been winning numerous North-South services, handling a large number of ad-hoc Asia-Europe vessels, increasing productivity and becoming more efficient. Meanwhile, DP World Southampton has consistently maintained its record as the UK’s best performing container terminal and increased its market share.”


Secretary, Dr. Liam Fox, said: “We have fully supported this historic agreement which will remove some of the barriers to cross-border trade and could benefit the UK economy by up to £1 billion. We will now work with other WTO members to ensure economies, both developed and developing, fully realise the benefits it will bring to their


///NEWS He added: “We are also looking


forward to announcing the opening of Berth 3 at DP World London Gateway at the end of March, in time for ‘THE Alliance’s’ arrival. This third deep-water berth at the UK’s newest port, along with our three deep-water berths at DP World Southampton, offer more choice and more reliability for shippers.”


THE Alliance has also produced


a contingency plan in the event of a member line going bankrupt. There will be an independent trustee to manage funds and to continue alliance operations in such an event, ensuring that customers’ cargo on board the affected ships is carried to the port of destination.


citizens. “The UK has long supported


initiatives that will make trade across borders easier, but despite the work that has already been done on border controls until now goods have continued to be delayed at borders slowing trade flows and adding costs to business which in turn might be passed on to consumers.”


Clecat chief sees frictionless borders Director general of the


Clecat European forwarders’ organisation, Nicolette van der Jagt, said that her members would welcome TFA: “It seeks to create better conditions for the effective and efficient movement of


goods across


geographies and, most especially, over


the barriers


that borders create.” She added that Clecat was


“mostly interested in the practical implementation for business, which largely comes through customs procedures and legislation. Over the last years we have seen a very close cooperation between the WTO and the World Customs Organisation (WCO) in support of global standards such as the WCO SAFE Framework of Standards. We are therefore grateful that the WCO under the guidance of Secretary General Kunio Mikuriya, has actively supported the implementation of the TFA – including the WCO Safe Framework of Standards and AEO programmes.” The process towards simpler


and faster borders has in fact already begun she argues, in that the Union Customs Code


(UCC) that came into force in May 2016 “aims to ensure a level playing field throughout the European Union, translating among others the aims of the WTO TFA into concrete legislation.” But she acknowledged


that challenges remain and Clecat supported FIATA’s warning against increased protectionism. “Also, whereas the UCC is a good piece of work the challenges remain in its implementation. Many good ideas for simplifications were removed in the course of the UCC consultation process because of risk control concerns. In particular there seems to be a strong tendency to request increasing amounts of data and to collect them together. There needs to be a better balance between risk control and simplification and, in particular, there should be a distinction between trustworthy economic operators and others when increasing data requirements.” She says there also remains


the need to streamline the importing process by creating a ‘one stop shop’ system; allowing


veterinary, phytosanitary, agricultural and other controls to be managed through a single IT interface mutually used and recognised in all EU member states.


This would


eliminate red tape, saving time and money as goods will only be stopped once for checks.


Ultimately, there is


the ambition for a customs single window in Europe, as promoted by the TFA. However, says van der Jagt:


“We are in a European Union where a lot of the detail when it comes to implementation is leſt with the member states and they sometimes seem to be ‘lost in translation’. Even with the UCC there are still too many possibilities for member states to decide how they will interpret and implement certain rules. This non-uniformity results in uncertainty for traders and intra-EU competition. with some states offering trade more favourable conditions and efficient customs procedures in order to increase the volume of business going through their ports, airports and distribution networks.”


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