Trade Facilitation:

An Introduction

Jan.Hoffmann@UNCTAD.org
Geneva, May 2009
Trade Facilitation: An Introduction

• Scope of Trade
facilitation
• Traders’ main
concerns
• Key areas of work
Trade Facilitation: An Introduction

• Scope of Trade
facilitation
• Traders’ main
concerns
• Key areas of work
 TRADE FACILITATION

Simplification Harmonisation Standardisation

Process of eliminating Alignment of national Process of developing

all unnecessary procedures, operations internationally agreed
elements and and documents with formats for practices
duplications in international and procedures,
formalities, processes conventions, standards documents and
and procedures and practices. information.
TRADE FACILITATION

Standardisation

Process of developing
internationally agreed
formats for practices
and procedures,
documents and
information.
International rules and standards

• IMO

• ISO

• UN-CEFACT

• WCO

• WTO
UN Lay-out Key
(UNECE Rec.#1)
 TRADE FACILITATION

Simplification Harmonisation Standardisation

Process of eliminating Alignment of national Process of developing

all unnecessary procedures, operations internationally agreed
elements and and documents with formats for practices
duplications in international and procedures,
formalities, processes conventions, standards documents and
and procedures and practices. information.
TRADE FACILITATION

Harmonisation

Alignment of national
procedures, operations
and documents with
international
conventions, standards
and practices.
 TRADE FACILITATION

Simplification Harmonisation Standardisation

Process of eliminating Alignment of national Process of developing

all unnecessary procedures, operations internationally agreed
elements and and documents with formats for practices
duplications in international and procedures,
formalities, processes conventions, standards documents and
and procedures and practices. information.
 TRADE FACILITATION

Simplification

Process of eliminating
all unnecessary
elements and
duplications in
formalities, processes
and procedures
 TRADE FACILITATION

Simplification Harmonisation Standardisation

Process of eliminating Alignment of national Process of developing

all unnecessary procedures, operations internationally agreed
elements and and documents with formats for practices
duplications in international and procedures,
formalities, processes conventions, standards documents and
and procedures and practices. information.
Trade Facilitation: An Introduction

• Scope of Trade
facilitation
• Traders main
concerns
• Key areas of work
 The Trade Transaction

GOODS

S INFORMATION
B
PAYMENT
 Company B

Company A
Product

Supplier Manufacturer Wholesalers Retailers Customer

 What do traders want ?
• Simple and smooth processing of formalities
• Means to allow goods to proceed promptly to
their final destination. No longer itineraries, no
unpacking, no delays
• A single control point for all public services
• Standard forms, assembled into a ‘single bunch
of documents’, compatible with trade documents
and transport contracts
• Predictable and transparent rules and procedures
 Data exchange
in International Trade
Purchase Exportation Importation • 20 actors;
Bill of lading, Documentation
• > 200 data
Vessel Booking Request elements;
Confirmed Line of Credit
Vessel Booking Confirmation
• Manual procedures;
Release/Approval
Importer’s Exporter’s Bill of Lading • Multiple data
Bank Bank
Rated Bill of Lading Arrival Notice
systems;
Original B/L, Import
Fund Transfer
Invoice, PO, Ocean Carrier Terminal
• > 30 documents or
Dock Receipt
Packing List Operator messages.
Demurrage
Line of Credit guarantee &
Proforma Invoice payment Cargo
LC Export Status
Confirmation Terminal
Purchase Order Operator
Customs House Broker
Importer Exporter
Dock receipt Pick-up &
Import Delivery Order
Proforma Invoice Pick-up & Delivery Order Docs
Letter of Release/Hold
Instruction Notice Cargo Status Inland
Invoice, PO Freight Forwarder / Carrier
Inland
NVOCC
Carrier
Manifest Customs ( Import )
Shipping & Funding Detail Dock receipt
Export Declaration
Marine Insurance Shipping & funding detail Vessel Manifest
Company AES Export Declaration
Port
Converted Vessel
Customs (Export)
Manifest
Importer Notice
 Too many documents…
• Enquiry
• Order
• Despatch advice
• Collection order
• Payment order
• Documentary credit
• Forwarding instructions
• Forwarder's invoice
• Goods receipt
• Air waybill
• Road consignment note
• Rail consignment note
• Bill of lading
• Freight invoice
• Cargo manifest
• Export licence
• Exchange control doc.
• Phytosanitary certificate
• Veterinary certificate
• Certificate of origin
• Consular invoice
• Dangerous goods declaration
• Import licence
• Customs delivery note
• TIR carnet
PRE-ARRIVAL & ARRIVAL INFORMATION
Pre-Arrival
• Vessel’s characteristics or ship’s particulars, kind and tonnage of cargo, vessel’s ETA and master’s requests must be notified to the Harbour
Master Department every 48hrs, 24hrs or at least six hours prior to vessel’s arrival at the port’s anchorage areas.
Arrival
• The component of the committee that performs vessel clearance consists of 10 members from Harbour Master Department, Department of
Customs and Excise, Immigration Police, National Shipping Agency and Broker, and Quarantine Authorities. Ten copies of cargo manifest
are required to be provided to the Department of Customs and Excise.
• Entry permit (arranged by official shipping agency),
• Last port clearance certificate,
• 15 lists of last port of call (at least 10 last ports),
• 5 declarations of vessel’s arrival,
• 10 import cargo manifests,
• 3 bills of loading,
• 2 transit cargo manifests,
• 7 crew lists,
• 7 passenger lists,
• 3 lists of vessel’s provisions,
• 3 lists of crew personal effects,
• 1 copy of health declaration certificate,
• 1 copy of vaccination list,
• 1 copy of drugs and narcotic list,
• 1 copy of fresh water origin,
• 3 cargo plans,
• 1 copy of valid original ship’s certificates (to be collected only on the first call of the year of each ship),
• Certificate of vessel's registration,
– International load line certificate,
– International tonnage certificate,
– International oil pollution prevention certificate,
– Cargo vessel safety equipment certificate,
– Cargo vessel safety construction certificate,
– Cargo vessel safety radio certificate,
– Minimum safe manning certificate.
• Exemption Certificate (to be inspected by quarantine officers ).
 Days to complete each stage of importing

Port and Customs Inland

Pre-arrival terminal and transport to
Region documents handling inspections warehouse Total time
OECD high income 8 2 2 2 14
East Asia & Pacific 18 3 4 3 28
Latin America & Caribbean 24 4 5 3 36
Middle East & North Africa 25 5 9 4 43
Europe & Central Asia 25 4 7 7 43
South Asia 24 6 7 10 47
Sub-Saharan Africa 33 8 10 9 59
World 23 5 6 5 40

Source: World Bank Doing business 2006

 Inspections
% of cargo
inspected
Region (import)
OECD 5
East Europe 18
East Asia 31
Latin America 51
Middle East 63
Africa 67
South Asia 69

Source: World Bank Doing Business 2006

Trade Facilitation: An Introduction

• Scope of Trade
facilitation
• Traders main
concerns
• Key areas of work
 Functional linkages

Customs Risk
Time Release Assessment
Adapted Standardized
H.S. Customs documentation
Automation

Post-audit Single
Controls Window
 Sequencing

Q4 04 Q1 05 Q2 05
ID
Linkages between
Trade Facilitation measures 7.11 5.12 2.1 9.1 16.1 23.1 30.1 6.2 13.2 20.2 27.2 6.3 13.3 20.3 27.3 3.4 10.4

1 Standardization and simplification

2
Introduction of single administrative
document (SAD)
3
Computerization and automation of Customs
procedures
4
Risk management, pre-arrival processing and
post-clearance audit
5
Customs-related judicial or administrative
measures
 Cooperation at the national level

• Between the government institutions

concerned by foreign trade:
Finance, Commerce, Transport
• With the private sector in the trading
community: importers and exporters
• With service providers:
transport operators, banks, insurance
companies…
Cooperation at the international level
Trade Facilitation: An Introduction

Questions?
• Scope of Trade
facilitation
• Traders’ main
concerns
• Key areas of work