Facilitating Trade: Improving Customs Risk Management Systems in the OIC Member States OIC Study th Meeting of the COMCEC Trade Working Group

Transcription

1 Facilitating Trade: Improving Customs Risk Management Systems in the OIC Member States OIC Study th Meeting of the COMCEC Trade Working Group The presentation is specially prepared for the 11 th Working Group Meeting of the COMCEC Trade 1

2 Objectives and Methodology of the Study 1 Benchmark Criteria of the Study 2 Main Findings Analysis Results 3 Non-OIC Case Studies 4 OIC Case Studies 5 OIC MS CRM Challenges / Policy Options 6 2

3 Objectives and Methodology of the Study 1 Benchmark Criteria of the Study 2 Main Findings Analysis Results 3 Non-OIC Case Studies 4 OIC Case Studies 5 OIC MS CRM Challenges / Policy Options 6 3

4 1. Methodology and Objectives of the Study Methodology of the Study Desk Research Desk Research Literature Review Review Trends in CRM Experiences Globally Locate and Analyze CRM Systems in Three Non-OIC Countries Develop Lessons Learned and Critical Success Factors/Challenges Data Collection Survey creation and dissemination Collection, systematization and analyzing of the statistical data from internationally available databases To document the current status of CRM systems in the OIC MS and develop benchmarking criteria Data Analysis Analyzing by different statistical tools as descriptive statistics Compare different variables and correlation analysis Find the influence of different aspects of CRM development in OIC MS with trade costs, country rankings related to trade facilitation Field Visit Case Study Face-to-face interviews with representatives from CAs Identify the major steps necessary to achieve an efficient and effective CRM in these countries Draw a series of conclusions and for further improvement of CRM across the OIC member states 4

5 1. Methodology and Objectives of the Study Objectives of the Study 5 To improve awareness of the CRM and the benefits it produces for the trade facilitation To share information on the best practices of CRM implementation To explore the state of play of CRM in the OIC countries, including CRM implementation, performance and trade facilitation impacts, and To provide policy options and guidelines for establishing/improving effective CRM.

6 1. Methodology and Objectives of the Study The Sections of the Study Introduction 1 Conceptual Framework 2 Global Trends and Best 3 Practices Analysis of the CRM 4 Implementation Stage Assessments in 3 OIC 5 Member Countries Conclusions and 6 Recommendations 6

7 Objectives and Methodology of the Study 1 Benchmark Criteria of the Study 2 Main Findings Analysis Results 3 Non-OIC Case Studies 4 OIC Case Studies 5 OIC MS CRM Challenges / Policy Options 6 7

8 2. Benchmark Criteria of the Study 8 Supporting Mechanism Organization & Management CRM Cycle Monitoring & Review Technology/ Infrastructure Customs Code, Implementing Regulation and Customs Strategy Law Enforcement and CRM Strategy/Policy Action Plan and KPA MMA and MoUs Implementation of International Standards and Agreements Organizational Structure Support of CRM Change Management and Continuous Improvement Human Resource Development (Knowledge- Based Systems) Processes and Standard Operational Procedures. Risk Assessment (Risk Identification Risk Analysis and Risk Evaluation and Prioritization) Preparation/ Profiling Targeting Covering/ Treatment Evaluation of outcomes/ Feedback Key Performance Area, Key Performance Indicators Performance Indicators Tools, equipment, and Infrastructure; LE IT System; CRM Module Embed in CDPS / Integrated CRM System; Data Warehouse, Business Intelligence, and Data Mining.

9 2. Benchmark Criteria of the Study Assessment method Cross-country comparison: single criteria 1 Data Collection 3 different collection methods: interviews, survey and desk research. OIC MS returned the limited number of surveys (12 in total) 2 Desk Research and Interviews collection of information for the three case studies (Turkey, Senegal and Albania CAs). 3 Cross-country Comparison relies on single criteria - Risk Management Cycle, on which information can be obtained for all OIC MS even in the absence of a survey 9

10 Objectives and Methodology of the Study 1 Benchmark Criteria of the Study 2 Main Findings Analysis Results 3 Non-OIC Case Studies 4 OIC Case Studies 5 OIC MS CRM Challenges / Policy Options 6 10

11 3. Main Findings Analysis Results Level of coverage of the CRM cycle No CRM Basic CRM CRM Level of Implementation Medium CRM performances Advance CRM performances Full CRM performances Coverage of the CRM Process No Coverage 2 Processes of the CRM 3-4 processes of the CRM 5 processes of the CRM All CRM processes covered 1

12 3. Main Findings Analysis Results Level of coverage of the CRM cycle in OIC MS 30% Full CRM 7% Advance CRM 44% Medium CRM 3% Basic CRM 16% No CRM 12

13 3. Main Findings Analysis Results Level of coverage of the CRM cycle between the three OIC regional groupings 13

14 3. Main Findings Analysis Results Level of coverage of the CRM cycle in the OIC MS 34 OIC MS was participating to the 2017 Second Global Survey on Trade Facilitation and Paperless Trade Implementation 13 (38.24%) reported that they have fully implemented CRM; 15 (41.42%) reported partial implementation stage; 2 (5.88%) in the planning stage and 7 OIC MS have not implemented CRM 14

15 3. Main Findings Analysis Results Timeline - CDPS Implementation in OIC MS Information available for 38 OIC MS 2010 ~ CDPS 2000 ~ CDPS 1990 ~ CDPS 15

16 3. Main Findings Analysis Results Trade Costs and Time Comparative Analysis between OIC MS, EU, CEFTA and ASEAN 16

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19 3. Main Findings Analysis Results Authorized Economic Operator 26 out of 57 OIC MS have not implemented AEO; 4 MS has the legal framework for authorized traders programme adopted; 3 MS are under development; 24 MS has implemented the AEO or similar simplification measures concepts. According to the WCO Compendium of AEO Programme (2017): Total number of the AEO operators in OIC MS is 606 In average, 25 operators per MS Turkey is the leader in the OIC MS with 225 AEO operators, and Morocco with 180 AEO operators (category A). OIC MS Year of adoption of AEO Concept No. of operators Albania Adopted legislation Algeria 2012 Azerbaijan Bahrain Under Development Bangladesh Under Development Exporter at the pilot stage Brunei Darussalam Sutera Lane Merchant Scheme 2017 Cameroon Performance Operators Contracts Importers Ivory Coast 2017 Experimental phase 2nd quarter 2017 with 10 pilot companies Egypt Indonesia Iran Jordan Golden List Kazakhstan legal entities Kyrgyzstan EAEU legislation adopted Lebanon 2010 Malaysia Morocco (180 category A) Mozambique Nigeria 2017 Oman 2017 Pakistan Under Development Saudi Arabia 2017 Senegal Privileged Partnership Programme Sudan Golden List Tajikistan EAEU legislation adopted Togo Privileged Partnership Framework pilot operators Tunisia Turkey Uganda Importers/Exporters 19 Customs clearing agents United Arab Emirates Golden List programme

20 Objectives and Methodology of the Study 1 Benchmark Criteria of the Study 2 Main Findings Analysis Results 3 Non-OIC Case Studies 4 OIC Case Studies 5 OIC MS CRM Challenges / Policy Options 6 20

21 4. Non-OIC Case Studies 4.1 Legal, Strategic and Other Mechanism Kosovo Australia New Zealand Seneal Albania Customs Strategy provides valuable input in the LE and CRM Strategies/Policy; The laws are fully compliant with current EU acquis supported by the other related regulations and strategies. The Australian Border Force (ABF) adopted Strategy 2020 and the Corporate Plan , aligned with the ABF reform programme; Main objectives stipulated in the 2020 Strategy is riskbased processes of passengers and goods flow, customs compliance, and revenue collection. New Legislative framework (regulatory framework for CRM, supported by a series of measures to TF and ensures compliance) Strategy related to CRM is Intelligence-led, risk-based streamline, simplification of trade processes, other border-related risks through an integrated risk management approach. 21

22 4. Non-OIC Case Studies 4.2 Organization and Management Kosovo Australia New Zealand Establishment of Risk Management Commission (RMC) monitoring the customs compliance and revenue collection. Australian Customs and Protection of Borders Service were merged with the Department of Immigration and Border Protection to establish the Australian Border Force (2015); Customs and Border Protection introduced a Profile Management Board and developed a plan for measurement of the CRM performances. Establishment of Customs Audit and Risk Committee monitoring the performances in information management, enforcement, revenue collection, coordinated examination and delegation of control. 22

23 4. Non-OIC Case Studies 4.3 Risk Management Cycle 23 Kosovo Australia New Zealand Full coverage of the CRM Cycle LE IT System for managing the feedback/irregularities; Exchange of customs data in real time with the neighboring countries (SEED)/Risk Assessment on pre-arrival information; Intelligence based CRM. Full coverage of the CRM Cycle Use of intelligence, combined with information flows from other intelligence agencies; Common CRM repository/crm management system with border and OGAs; National level - exchange of information Full coverage of the CRM Cycle Automated Targeting System assesses prearrival passenger s information; Border Protection Financial Management Information System (FMIS) Exchanges data with OGAs, National, and International agencies.

24 4. Non-OIC Case Studies 4.4 Monitor and Review 24 Kosovo Australia New Zealand The performances of KC CRM is monitored continuously - comparative analysis of risk indicators/profiles on the historical data using BI and data mining. Evaluation of the effectiveness of CRM - Cargo Intervention Strategy (CIS) and Differentiated Risk Response Model (DRRM). CRM assessment tool - Customs Harm Model, enables NZCS to measure the impact of Customs enforcement and risk management performances.

25 4. Non-OIC Case Studies 4.5 Technology 25 Kosovo Australia New Zealand CRM supported by the AW, Integrated LE IT System, DWH/BI and data mining; Australian Integrated Cargo IT System (ICS) - CDPS with full coverage of CRM Cycle; Use of advanced CRM technique - data mining and risk profile simulation. Joint Border Management System (JBMS) - advanced risk management tools supporting Customs and Ministry of Primary Industry and all border stakeholders.

26 Objectives and Methodology of the Study 1 Benchmark Criteria of the Study 2 Main Findings Analysis Results 3 Non-OIC Case Studies 4 OIC Case Studies 5 OIC MS CRM Challenges / Policy Options 6 26

27 5. OIC Case Studies 5.1 Legal and Strategic Support to the CRM 27 Turkey Senegal Albania CRM Strategy - Overall Customs Strategy Improvement of legal, technical and administrative infrastructure AEO implemented in 2013, (225 AEO certificates issued) LE strategy vs CRM Strategy (control and facilitation purposes) CRM strategic plan without regulatory character. PPP established in PPP will transform in AEO. (11 PPP holders) Administrative Instructions, Implementing Regulations, and SOP Implemented the AEO status (no trader has applied for AEO)

28 5. OIC Case Studies 5.2 Organization and Management Turkey Senegal Albania Decentralized (risk assessment process performed on the local and regional level) Centralized (CRM and Intelligence Department) The IT department is providing continuous support to the CRM and the Intelligence Department. Centralized (Risk Analysis, Unit and the Monitoring Unit) Plan: Merge CRM and Intelligence (with 44 customs officers) 28

29 5. OIC Case Studies 5.3 Risk Management Cycle Turkey Senegal Albania Integrated DW (GUVAS) supports CRM in identification of the risks Cover the full CRM cycle and is intelligence-led. Full automation of CRM Inter-Services Committee coordinate the CRM Department 2 parallel CRM systems SIAR and TAME The CRM Department is responsible for CRM Cycle ACA is part of the SEED project 29

30 5. OIC Case Studies 5.4 Monitor and Review 30 Turkey Senegal Monitor performances related to CRM Risk Profiles assessment at every six months. Quantitative Measurements National Information and Documentation System (FNID - drugs, litigation, vessels and currency declarations)

31 5. OIC Case Studies 5.5 Technology Turkey Senegal Advanced IT tools Integrated customs data warehouse (GUVAS) -monitor and measure Ongoing project for implementation of data mining concept in TCA. GAINDE Intégrale CDPS SW and TAME for risk analysis, targeting and risk guidance. 31

32 Objectives and Methodology of the Study 1 Benchmark Criteria of the Study 2 Main Findings Analysis Results 3 Non-OIC Case Studies 4 OIC Case Studies 5 OIC MS CRM Challenges / Policy Options 6 32

33 6. OIC CRM Challenges / Policy Options 6.1 Legal and Strategic Support to the CRM 33 Challenges Revenue collection VS trade facilitation, community protection, and national security Policy Options Strategic support of CRM with overall customs strategy and specific Law Enforcement and CRM Policy Strategy review and evaluation of progress. Information to measure progress regarding non-revenue related strategic objectives not available Develop clear goals, objectives and performance measures (balancing revenue and non-revenue objectives)

34 6. OIC CRM Challenges / Policy Options 6.1 Legal and Strategic Support to the CRM 34 Challenges Policy Options Action plans are not specific Development of strong strategic planning process Legal basis for exchange of securityrelated information of high-risk consignments Laws: Customs control is based on risk analysis, use of pre-arrival information and the concept of simplified procedures Legal Basis - AEO Customs and trade partnership programmes for AEO Customs-to-Business Cooperation to facilitate legal trade;

35 35 6. OIC CRM Challenges / Policy Options 6.1 Legal and Strategic Support to the CRM Challenges Policy Options Lack of or inadequate control authority Sufficient authority to undertake inspection functions, with adequate powers

36 6. OIC CRM Challenges / Policy Options 6.2 Organization and Management Challenges Policy Options Traditional silo-functional and geographical lines Critical value-added functions (TF, CRM, intelligence, PCA) Lack of change management and continuous improvement Sound change management strategy 36

37 6. OIC CRM Challenges / Policy Options 6.2 Organization and Management 37 Challenges Policy Options Cooperation with other border management agencies Strong CA HRM Strategic Planning Process Ensure continuous HR development and career advancement Training for customs staff Development and implementation of a training programme for customs staff Conduct organizational competency assessment/audit to identify current gaps;

38 6. OIC CRM Challenges / Policy Options 6.2 Organization and Management 38 Challenges Policy Options Necessary CRM processes with the requisite SOPs. Risk Management Committee Monitoring process From partial to full coverage of the CRM cycle using BPR; Develop and review CRM processes and integrate them into the other CA processes

39 6. OIC CRM Challenges / Policy Options 6.2 Organization and Management (IT Systems VS Cycle) 39

40 40 6. OIC CRM Challenges / Policy Options 6.3 Risk Management Cycle Challenges Policy Options CRM is not based on compliance measurement, risk assessment or profiling. Concept of measurement, object of measurement and methods of measurement (consequences and uncertainty) CRM cycle focus on high-risk goods while facilitating low-risk shipments Advanced risk assessment techniques and tools Coverage of CRM cycle based on CRM functionalities embedded in CDPS Enhanced use of IT for integration of the full CRM cycle

41 41 6. OIC CRM Challenges / Policy Options 6.3 Risk Management Cycle Challenges Policy Options Lack of automated processing Regular and ad-hoc review and updating of the risk profiles/indicators IT systems for management of the feedback/outcomes from the control Lack of cooperation/exchange of information with the relevant stakeholders Closer contact and communication with traders and OGAs Information exchange with other Customs administrations in real time

42 6. OIC CRM Challenges / Policy Options 6.3 Risk Management Cycle 42

43 6. OIC CRM Challenges / Policy Options 6.3 RM Cycle (Example of Text Mining on e-news Sources) 43

44 6. OIC CRM Challenges / Policy Options 6.4 Monitor and Review Challenges Policy Options Action plan - elements for measuring the performances of LE and CRM Appropriate management information, operational statistics and performance indicators Performance information and operational statistics related to revenue collection performance Supportive IT systems CRM SOP and business processes are poorly developed Improving existing business processes (international standards and procedures) 44

45 45 6. OIC CRM Challenges / Policy Options 6.5 Technology Challenges Policy Options Adequate tools, equipment and infrastructure for the inspection Strategic support of CRM focusing on safety and security instead only on revenue collection; Pre-arrival/pre-departure information for risk assessment IT support for the electronic submission of prearrival/pre-departure information for risk assessment.

46 6. OIC CRM Challenges / Policy Options 6.5 Technology Challenges Policy Options Manual, non secured management of information in LE; Integrated Customs Law Enforcement IT System; CRM Module embedded in CDPS; Integrated Customs Risk Management System; Data is frozen in multiple systems/data layers; Data integration for effective CRM; Manual data processing and homegrown solutions Data Warehouse / Business intelligence; 46

47 47 6. OIC CRM Challenges / Policy Options 6.5 Technology Challenges Policy Options Inconsistent fact base for decisions create multiple versions of the truth; Non-application of international standards can hamper operation of data transfer, and exchange of messages. Using data mining and predictive analytics

48 6. OIC CRM Challenges / Policy Options 6.5 Technology Example (Kosovo Law Enforcement IT System) 48

49 6. OIC CRM Challenges / Policy Options 6.5 Technology (ICT Traditional Silo) 49

50 6. OIC CRM Challenges / Policy Options 6.5 Technology (Big Data Common CRM Repository) 50

51 6. OIC CRM Challenges / Policy Options 6.5 Technology (Data Integration steps) 51

52 6. OIC CRM Challenges / Policy Options 6.5 Technology (Example of ICRM System Conceptual Model) 52

53 Thank You For Your Attention 53