2013 ARF UNCR 1540 Implementation Workshop Topic : Targeting and Risk Management

Transcription

1 2013 ARF UNCR 1540 Implementation Workshop Topic : Targeting and Risk Management By Mr James K W Wong, Technical Attaché WCO ROCB A/P (jameskwwong@rocbap.org) 15 May 2013

2 Content (a) Brief introduction of (b) Brief introduction of Asia Pacific Regional Office for Capacity Building (ROCB A/P) (c) A sample country before application of Risk Managemnet and Targeting (d) Basic ideas of Risk Managemnet and Targeting

3 Content (e) The sample country after application of Risk Management and Targeting (f) Conclusion

4 (a) Brief Introduction of WCO Please see the PDF file.

5 (b) Brief Introduction of ROCB A/P Please see the powerpoint file for ROCB A/P.

6 (C) A sample country before application of Risk Managemnet and Targeting Country X in the Eastern Europe Before-1 -All imports and exports were subject to physical inspection. -Few contrabands could be surfaced. -Opportunities for corruption were many.

7 (c) A sample country before application of Risk Managemnet and Targeting Country X in the Eastern Europe Before-2 -No electronic submission of documents. -Legal framework for Customs clearance is unclear e.g. documents processing and procedures. -Customs officials could demand over 20 different documents from traders.

8 (c) A sample country before application of Risk Managemnet and Targeting Country X in the Eastern Europe Before-3 -Impossible for importers to know what types of documents are required for Customs clearance in advance. -No communication between the private sector and the Customs administration.

9 (d) Basic ideas of Risk Management and Targeting (1) Definitation -The systematic application of management procedures and practices which provide Customs with the necessary information to address movements or consignments which present a risk. (2) Major components Risk Assessment -Risk identification -Risk analysis -Risk evaluation -Seizure analysis -Prioritization

10 (d) Basic ideas of Risk Management and Targeting Risk Profiling -Risk areas -Risk indicators -Means of control -Period of profiling Learning cycle => Risk finding => Risk Analysis => Preparation => Detection => Covering => Evaluation => Risk finding

11 (d) Basic ideas of Risk Management and Targeting -Targeting is based upon the prior identification of high risk goods, conveyances and passengers combined with document review, questioning and observation techniques in order to actually decide which ones to submit to a closer examination.

12 (e) A sample country after application of Risk Managemnet and Targeting Country X in the Eastern Europe After-1 -A reform project was undertaken from 2005 to Implementation was systematically expanded to all customs clearance offices, and by July 2008, risk-based cargo selectivity was fully operational throughout the country X. -The Government took the decision to replace all physical inspections with a risk-based cargo selectivity system. Introducing risk management in customs significantly reduced petty corruption and, in combination with sensible laws and procedures, enabled traders to comply voluntarily with.revenue laws.

13 (e) A sample country after application of Risk Managemnet and Targeting Country X in the Eastern Europe After-2 -Customs Risk Management: Today, 90 per cent of all shipments are only subject to document review ( yellow channel ), which has reduced the time needed to clear most shipments by several days. The remaining 10 per cent undergo physical inspection ( red channel ). Selection is based on a combination of risk criteria that have been programmed into the computer system. -Authorized Economic Operators Gold List Programme: As part of the Customs risk management system, the green channel (no physical or document checks) has been implemented for Gold List Programme importers.

14 (e) A sample country after application of Risk Managemnet and Targeting Country X in the Eastern Europe After-3 -The Gold List programme provides simplified import procedures for high-value/high-volume traders who have a demonstrated history of compliance. Simplified procedures include: (a) immediate release of goods, which circumvents slow and complicated formalities; (b) post-payment (up to thirty days) of Customs duties; (c) electronic submission of declarations with no attached documents required; and (d) advance declaration filing.

15 (e) A sample country after application of Risk Managemnet and Targeting Country X in the Eastern Europe After-4 Since November 2009, no Customs guarantee is required for Gold List members. The number of companies taking advantage of the Gold List programme has grown tremendously, from four companies in a pilot group to over two hundred. Results gained and Lessons learned -Trade volume revenues increased. rose from number 112, in 2005, to number 11, in 2010, in the World Bank s Doing Business ease of doing business ranking;

16 (e) A sample country after application of Risk Managemnet and Targeting Country X in the Eastern Europe After-5 -Technical help should be combined with procurement. This was crucial to the reform s success, particularly in the early days of automating business processes. As revenues rose, the Government adjusted its budget priorities and the project substituted technical assistance for procurement activities. -Implementation of risk management occurred only after numerous customs business processes had been revised and streamlined. Clearance procedures were simplified to include advance declarations, immediate release of goods for low risk traders, etc.

17 (e) A sample country after application of Risk Managemnet and Targeting Country X in the Eastern Europe After-6 -The Customs authorities physical inspection procedures were optimized and automated. A mechanism for public-private dialogue was created. A publicprivate task force on customs issues was set up. The Customs working group surveyed businesses in order to determine the problems they had encountered, identify the causes and propose solutions that were then incorporated into amendments to the customs code and secondary legislation.

18 (e) A sample country after application of Risk Managemnet and Targeting Country X in the Eastern Europe After-7 -The private sector thereby became a vigorous supporter for reform. Trade partners, who were initially distressed by constant change, became a champion and enabler for reform, providing literally hundreds of recommendations.

19 (e) A sample country after application of Risk Managemnet and Targeting Country X in the Eastern Europe After-8 -Key benefits The risk management system reduced physical inspections to per cent for imports and 13 per cent for exports; The time required for release of goods decreased from three days or more, to an average of two hours; About 90 per cent of all shipments are now cleared through the yellow channel, requiring only documentary checks;

20 (e) A sample country after application of Risk Managemnet and Targeting Country X in the Eastern Europe After-9 -Key benefits The goal of implementing risk-based inspections and post clearance audits encouraged the streamlining of customs procedures. Such streamlined procedures have been introduced for various customs regimes, including customs warehousing, inward processing relief, outward processing relief, temporary importation, export, re-export and returned goods relief; Documentation requirements have been clarified and dramatically reduced in number.

21 (e) A sample country after application of Risk Managemnet and Targeting Country X in the Eastern Europe After-10 -Key benefits Currently, only two documents are required for export and three for import. Conclusion The dramatic reductions in clearance time as a result of streamlining customs procedures and introducing risk management in Country X between 2005 and 2009 has lessened the cost of doing business, both for traders and for the revenue service.

22 (e) A sample country after application of Risk Managemnet and Targeting Country X in the Eastern Europe After-11 Summary -These reductions were accompanied by similarly dramatic increases in trade turnover, from 3.4 billion US$ in 2005 to 5.5 billion US$ in 2009, and in VAT revenues (60 65 per cent of which are collected at the border), it increases 92% in the same time period. - The simpler systems have made it easier not only for businesses to comply with, but also for the government to detect evasion. Risk-based inspections now identify nearly 100% more violations than physical inspections did in the past.

23 (f) Conclusion Conclusion-1 -An efficient approach for detecting and treating risks is to use risk management, which presupposes selective inspections. Customs administrations using 100% traditional control methods might want to change their approach. This may remain a shortterm challenge while Customs and other border control agencies develop a customs strategy with risk management especially in the current context of restrained budgets plus train staffs or managers for risk management. Customs administrations need to modernize and implement the latest risk management best practices.

24 (f) Conclusion Conclusion-2 -Points to note Staff and management must recognize the added value and effectiveness of risk management. Training for the entire organization can increase the understanding of new procedures. The internal structure of a Customs administration must be adapted to the reforms being undertaken. Customs laws and rules need to be reviewed to assure that the risk management techniques being implemented lie within legal boundaries;

25 (f) Conclusion Conclusion-3 -Points to note Customs administrations need to consider computerization and using electronic manifests that are aligned with international standards in order to provide for advance identification of highrisk shipments. References-1 WCO (28-29 June 2010), Background Paper on Risk Management [pdf]. Available from pdf [last accessed 29 March 2011].

26 (f) Conclusion References-2 WCO (28-29 June 2010), Background Paper on Risk Management [pdf]. Available from pdf [last accessed 29 March 2011]. WCO, Customs Enforcement Network (CEN) [htm]. Available from epcengien.htm [last accessed 1 April 2011]. WCO (June 2008), Resolution of the Customs Co-operation Council on the Role of Customs in the 21st Century [pdf]. Available from Role%20of%20Customs%20in%20the%2021st%20 Century%20_June%202008_.pdf [last accessed 1 April 2011].

27 (f) Conclusion References-3 WCO (December 2007), WCO Trends and Patterns Report: A Capacity Building estimate, Issue 2 [pdf]. Available from 0Building/Trends-Patterns/Trends2-EN.pdf [last accessed 30 March 2011].

28 THANK YOU