The SAFE Framework of Standards The SAFE Framework of Standards

Bob StruthersBob StruthersWorld Customs OrganizationWorld Customs Organization

Training on the New EU Implementations on Road Transport and Training on the New EU Implementations on Road Transport and Foreign Trade: Istanbul Turkey 25-26 June 2009Foreign Trade: Istanbul Turkey 25-26 June 2009

The World Customs The World Customs Organization (WCO) Organization (WCO)

is the only is the only intergovernmental intergovernmental organization with organization with

competence in competence in Customs matters.Customs matters.

Established in 1952 as the Customs Co-Established in 1952 as the Customs Co-operation Counciloperation Council

Renamed WCO as working title in 1994Renamed WCO as working title in 1994

Headquarters in Brussels Headquarters in Brussels

6 regional representatives6 regional representatives

Currently representing 174 members from all Currently representing 174 members from all geographic regions and at different stages geographic regions and at different stages of developmentof development

Members process > 98% of all international Members process > 98% of all international tradetrade

Facts and FiguresFacts and Figures

WCO SAFE FrameworkWCO SAFE Framework

Recognition of risks to the Recognition of risks to the security and facilitation of security and facilitation of the international trade the international trade supply chain led the WCO supply chain led the WCO to take bold action.to take bold action.

WCO Council Resolution, WCO Council Resolution, June 2002, forming a Joint June 2002, forming a Joint Customs-Industry Task Customs-Industry Task Force on Security and Force on Security and Facilitation.Facilitation.

SAFE Framework of StandardsSAFE Framework of Standards

Adoption at the Council in June 2005Adoption at the Council in June 2005 FrameworkFramework Letter of Intent to implement the Letter of Intent to implement the

FrameworkFramework

156 WCO Members make commitment to 156 WCO Members make commitment to implementimplement

Revised version published in 2007Revised version published in 2007

Core Elements of SAFE

FOUR CORE PRINCIPLESFOUR CORE PRINCIPLES

AdvanceAdvanceelectronic electronic

informationinformation

RiskRiskmanagementmanagement

OutboundOutboundinspectioninspection

BusinessBusinesspartnershipspartnerships

Harmonise the Harmonise the advance advance electronic electronic information information requirement on requirement on inbound, inbound, outbound and outbound and transit transit shipments.shipments.

Commit to Commit to employing a employing a consistent risk consistent risk management management approach to approach to address security address security threats.threats.

Outbound Outbound inspection of high-inspection of high-risk consignments risk consignments being exported, being exported, preferably using preferably using non-intrusive non-intrusive inspection inspection methods.methods.

Customs will Customs will provide benefits provide benefits to businesses to businesses that meet minimal that meet minimal supply chain supply chain security security standards and standards and best practices.best practices.

Two pillarsTwo pillars

The WCO Framework rests on two twin pillars:The WCO Framework rests on two twin pillars:

Customs-to-Customs network arrangements. Customs-to-Customs network arrangements.

Customs-to-Business partnerships. Customs-to-Business partnerships.

(Authorised Economic Operator (AEO) concept)(Authorised Economic Operator (AEO) concept)

Objectives of the FrameworkObjectives of the Framework

Certainty and predictability at a global level Certainty and predictability at a global level Integrated supply chain management for all Integrated supply chain management for all

transport modes transport modes Allow Customs to meet the challenges of the 21Allow Customs to meet the challenges of the 21stst

Century Century Closer cooperation among Customs Closer cooperation among Customs

administrations administrations Stronger Customs-to-Business cooperation Stronger Customs-to-Business cooperation Tangible benefits for businesses Tangible benefits for businesses Seamless movement of goods Seamless movement of goods

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Pillar 1Pillar 1

Customs-to-CustomsCustoms-to-Customs

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Pillar 1 covers the following:

1)1) Integrated Supply Chain ManagementIntegrated Supply Chain Management

2)2) Cargo Inspection AuthorityCargo Inspection Authority

3)3) Modern Technology in Inspection EquipmentModern Technology in Inspection Equipment

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Pillar 1 continued:

4) Risk Management4) Risk Management

5) High-risk Cargo or Container5) High-risk Cargo or Container

6) Advance Electronic Information6) Advance Electronic Information

7) Targeting and Communication7) Targeting and Communication

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Pillar 1 continued:

8) Performance Measures8) Performance Measures

9) Security Assessments9) Security Assessments

10) Employee Integrity10) Employee Integrity

11)Outbound Security Inspections11)Outbound Security Inspections

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All the containers bound to USAll the containers bound to USStarting from 1 July 2012Starting from 1 July 2012Possibility to extend the date of application for Possibility to extend the date of application for

4 additional years 4 additional years Pilot projects in 3 ports:Pilot projects in 3 ports:

Port Qasim, PakistanPort Qasim, PakistanPort Cortes, HondurasPort Cortes, HondurasSouthampton, UKSouthampton, UK

US SAFE Port ActUS SAFE Port ActH.R. 4954H.R. 4954

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Pillar 2Pillar 2

Customs-to-BusinessCustoms-to-Business

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Authorized Economic Operator Authorized Economic Operator in the SAFE Programin the SAFE Program

““A party involved in the international movement of A party involved in the international movement of

goodsgoods in whatever function that has been in whatever function that has been

approved byapproved by or on behalf of a national or on behalf of a national Customs Customs

administration as complying with WCO or administration as complying with WCO or

equivalent supply chain security standards. equivalent supply chain security standards.

Authorized Economic Operators include inter alia Authorized Economic Operators include inter alia

manufacturers, importers, exporters, brokers, manufacturers, importers, exporters, brokers,

carriers, consolidators, intermediaries, ports, carriers, consolidators, intermediaries, ports,

airports, terminal operators, integrated operators, airports, terminal operators, integrated operators,

warehouses, and distributors.”warehouses, and distributors.”

Pillar 2 covers the following:1) Partnership

- ensure that their internal policies and procedures provide adequate safeguards against the compromise of their shipments and containers

2) Security - incorporate pre-determined security best

practices into their existing business practices.

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Pillar 2 continued:

3) Authorization -The Customs administration, together with representatives from the trade community, will design validation processes or quality accreditation procedures that offer incentives to businesses through their status as Authorized Economic Operators.

4) Technology- maintain cargo and container integrity by facilitating the use of modern technology.

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Pillar 2 continued:

5) Communication -The Customs administration will regularly update Customs-Business partnership programs to promote minimum security standards and supply chain security best practices.

6) Facilitation - The Customs administration will work co-operatively with Authorized Economic Operators maximize security and facilitation

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Authorized Economic Operator Authorized Economic Operator Requirements and benefitsRequirements and benefits

2007 supplement introduced:2007 supplement introduced:

13 detailed AEO requirements sections (e.g. cargo, 13 detailed AEO requirements sections (e.g. cargo, conveyance, premises security) conveyance, premises security)

Section listing possible benefits (eg reduced data sets, Section listing possible benefits (eg reduced data sets, minimum number of cargo inspections etc)minimum number of cargo inspections etc)

Validation and Authorization proceduresValidation and Authorization procedures

AEO and Mutual RecognitionAEO and Mutual Recognition

A WCO Member Customs administration recognizes A WCO Member Customs administration recognizes the AEO authorization system in another WCO the AEO authorization system in another WCO Member Customs administration as equivalent to its Member Customs administration as equivalent to its ownown

Standardized approach to AEO authorization in SAFE Standardized approach to AEO authorization in SAFE provides a solid platform for the development of provides a solid platform for the development of international systems of mutual recognition of AEO international systems of mutual recognition of AEO status - bilaterally, sub–regionally, regionally and, status - bilaterally, sub–regionally, regionally and, in in the long termthe long term, globally, globally

AEO and Mutual RecognitionAEO and Mutual Recognition

Will afford the foreign AEO the same benefits as a Will afford the foreign AEO the same benefits as a national AEO national AEO

Improve predictability and efficiency of operationsImprove predictability and efficiency of operations

Tangible benefits to trade a challenge: Mutual Tangible benefits to trade a challenge: Mutual Recognition widely regarded as the ‘holy grail' of Recognition widely regarded as the ‘holy grail' of benefits.benefits.

Members’ AEO ProgrammesMembers’ AEO Programmes

EU AEO EU AEO US Customs Trade Partnership Against Terrorism (C-US Customs Trade Partnership Against Terrorism (C-

TPAT)TPAT) Canada’s Partners in ProtectionCanada’s Partners in Protection Jordan’s Golden ListJordan’s Golden List Singapore’s Secure Trade PartnershipSingapore’s Secure Trade Partnership Malaysia’s Customs Golden ClientMalaysia’s Customs Golden Client Japan’s AEO ProgrammeJapan’s AEO Programme New Zealand’s Secure Exports Scheme (SES) andNew Zealand’s Secure Exports Scheme (SES) and China’s AEO ProgrammeChina’s AEO Programme Korea’s AEO ProgrammeKorea’s AEO Programme

Members’ AEO ProgrammesMembers’ AEO Programmes

……..but bear in mind that 156 WCO members have but bear in mind that 156 WCO members have committed to Implement SAFE!committed to Implement SAFE!

Major , ongoing Capacity Building support Major , ongoing Capacity Building support required (Columbus Programme)required (Columbus Programme)

Current DevelopmentsCurrent Developments

Compendium of AEO programmes, including Mutual Compendium of AEO programmes, including Mutual Recognition Arrangements (MRA), to raise Recognition Arrangements (MRA), to raise awareness of other programmesawareness of other programmes

Guidance “How to set up an AEO Programme”Guidance “How to set up an AEO Programme”

SMEs and AEO SMEs and AEO

Scope and Objectives of the Research Scope and Objectives of the Research (AEO Compendium)(AEO Compendium)

Since June 2005 156 Members have signed SAFE Since June 2005 156 Members have signed SAFE Framework to Secure and Facilitate Trade;Framework to Secure and Facilitate Trade;

Research Objective: to evaluate the progress in Pillar II on Research Objective: to evaluate the progress in Pillar II on AEO implementation;AEO implementation;

Data used: in-house information (reports; previous Data used: in-house information (reports; previous questionnaires, open search) and targeted requests to questionnaires, open search) and targeted requests to Members;Members;

Scope of study: Scope of study: 40 programmes in 67 countries (due to EU-27 that has a 40 programmes in 67 countries (due to EU-27 that has a

single programme) on all continentssingle programme) on all continents 25 programmes identified for targeted approach 25 programmes identified for targeted approach

Information is being verified through the national Information is being verified through the national administrations (personalised requests)administrations (personalised requests)

Database of AEO contact persons is being formedDatabase of AEO contact persons is being formed

AEO Typology I (25 programmes)AEO Typology I (25 programmes)

Programme type: Programme type: Security/customs compliance – 14Security/customs compliance – 14 Security – 5Security – 5 Customs compliance – 6Customs compliance – 6

Type of operator:Type of operator: importers, exporters, logistic operators (carriers, forwarders, shipping importers, exporters, logistic operators (carriers, forwarders, shipping

companies, airlines), customs brokers, warehouse operators. Some companies, airlines), customs brokers, warehouse operators. Some countries (i.e. USA) included special categories for ports and foreign countries (i.e. USA) included special categories for ports and foreign manufacturers.manufacturers.

Legislation: Legislation: all programmes envisaged voluntary participation in the programme.all programmes envisaged voluntary participation in the programme. most countries introduced amendments to their current legislation most countries introduced amendments to their current legislation

(mainly Customs Codes) or passed new legislation specifically for (mainly Customs Codes) or passed new legislation specifically for AEO;AEO;

some countries, like Canada, Singapore or Australia have not some countries, like Canada, Singapore or Australia have not introduced any specific legislation to provide for an AEO.introduced any specific legislation to provide for an AEO.

AEO Typology II (25 programmes)AEO Typology II (25 programmes)

Further plans:Further plans:

Development of new electronic applications;Development of new electronic applications;

Improvement of procedures;Improvement of procedures;

Enlarging the scope of programme (import/export) or Enlarging the scope of programme (import/export) or elaborating it to include more types of operators;elaborating it to include more types of operators;

Adding a security component (for customs Adding a security component (for customs compliance programmes)compliance programmes)

Mutual Recognition ArrangementsMutual Recognition Arrangements

JapanJapan NZNZ AUAU CNCN CACA MYMY

USAUSA NZNZ CACA JOJO SNSN JPJP

EUEU CNCN NONO CHCH JPJP USUS

SingaporeSingapore NZNZ AUAU JPJP CACA

KoreaKorea NZNZ USUS JPJP

ArgentinaArgentina BRBR Concluded MRAConcluded MRA

To be concludedTo be concluded

Studies/consultations Studies/consultations in placein place

And the future….?And the future….?

Sustained Capacity Building SupportSustained Capacity Building Support

SAFE SurveySAFE Survey

Case studies on AEO mutual recognition – best Case studies on AEO mutual recognition – best practicepractice

Mutual Recognition Standards?Mutual Recognition Standards?

Thank you very muchThank you very much

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WCOWCOSAFE FrameworkSAFE Framework