Korean Experience with paperless trade system
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- Bethany Phelps
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1 Korean Experience with paperless trade system In the Occasion of VII Meeting of the Inter-American Network of International Trade Single Windows (Brasilia, Brazil, May 21-22, 2015) May 22, 2015 Korea Trade Network(KTNET)
2 Contents utradehub-paperless Trade Single Window Practical cases of Paperless Trade Port Community System with Paperless Trade Major Milestones and Benefits Pan Asian e-commerce Alliance 6 Knowledge Share for Seamless Paperless Trade
3 1 utradehub-paperless Trade Single Window
4 1-1. Needs for Paperless Trade in Korea [Since 1992] Manage entire trade procedures on-line Paperless Trade in Korea covers either all or some parts of trade procedures on-line via e-documents [1991] Act on Promotion for the Trade Business Automation [Until 1990] Rapid increase in trade volume (Billion US$) Nation-wide Infrastructure using ICT with Business Process Renovation & Trade Procedure Simplification Needs for reducing business processing time & cost Excessive paper documents Bottleneck in trade procedure Big Hassle days for clearance
5 1-2. Legal Status of Single Window Established by the Government Initiatives such as MOTIE and Korea Customs Service Background : Act on Promotion for the Trade Business Automation ( 91) Shareholder : KITA (Korea International Trade Association), 100% National Paperless Trade Infrastructure Provider Purchase Confirmation of raw materials for Export Goods Service Agency Foreign Trade Act (MoTIE, Nov.,2008) Act on the Promotion of Paperless Trade(MoTIE, June, 2006) Infrastructure Service Provider e-customs Service Provider Customs Act (KCS, March 2003) Electronic Bill of Lading (e-b/l) Title Registry Commercial Act (MoJ, Sep.,2008) National Certificate Authority Digital Signature Act (MSIP, Feb., 2002) Certified e-document Authority Framework Act on Electronic Commerce (MSIP, Feb., 2007)
6 1-3. Korean Single Window, enables Seamless Paperless Trade supporting the whole cycle of trade process One-Stop, One-Click and One-time Document Submission Service PAA Initiative Korea-Taiwan e-c/o Paperless Trade Initiative B2B Commerce/License & Certification P/O, Invoice, P/L Certificates/License e-c/o, Tax Bill Purchase Confirmation of raw material, Local L/C e-l/c, e-l/g e-negotiation Settlement Cross Border Transaction Service Application Trade Finance Manifest, e-b/l General Declaration Cargo Visibility API, ACI Data Warehouse e-document Repository e-document Exchange Hub Export Clearance Import Clearance Duty Draw-back Logistics Customs
7 1-4. Strong Community of utradehub Government Agencies <146> Korea Customs, Immigration, Quarantine, Port Authority Traders<58,228> Logistics <5,051> Freight Forwarders Bonded Transportation Financial Institutes <61> 62,144 Customers Airlines Shipping Lines Banks Bank of Korea Insurance Companies 370 Million transactions annually via 628 e-doc. s Global VAN & PAA Public Sector Private Sector
8 1-5. UN s 5stages for Seamless Paperless Trade Government Government + Private Global Stage4 Stage5 Stage1 e-customs System UNIPASS, ASYCUDA Stage2 Licensing & Certificate Agencies B2G Trade Single Window Customs Single Window Stage3 Logistics Platform PCS Integrated National Platform Paperless Trade SW; Regional Information Exchange Cross Border Transaction Source : Roadmap towards paperless trade, UNECE, 2006
9 1-6. Location < HQ, Trade Tower, WTC > < Operation Center, Trade Tower, WTC > < Korea Paperless Trade Center, Pangyo > < Data Center, Trade Tower, WTC >
10 2 Practical cases of Paperless Trade
11 2-1. Overview Transaction Number of electronic Trade Documents in 2014 Total Transaction : 370Million Number of e-documents in service : % growth in Transaction comparing to 2013 (2013 : 350Million with 615 e-documents) Major Documents with annual transaction of 100K : 360Million with 193kinds(98.3%);
12 2-2. Transaction per Business Categories Others 67Million 18.1% Trade Finance / Certificate & License 211Docs. 49.7Million 13.4% Logistics 230Million 61.4% Customs 23Million 6%
13 2-3. Transaction per Business Categories(Continued) Logistics Documents & 230 Million Transaction(61.2%) Import Cargo Receipt Notice (CUSRES) House Air Waybill (AIRFHL, CIMFHL) Air Freight Cargo Shipping Request Receipt Notice (SHPRQT) Air Passenger List (PAXLST) Export Cargo Manifest(Sea & Air) (CUSREP, CUSMAN) Import Cargo Manifest(Sea) (CUSREP, CUSMAN) 32Million 20Million 122Million 11Million 11Million 9.6Million
14 2-3. Transaction per Business Categories(Continued) Customs - 112Documents, 23Million Transaction(6.4%) Import Declaration Form Process Result Notice (CUSDPR) Import Declaration Form (CUSDEC) Export Declaration Completion Notice (CUSRES) Tax Invoice on Import(Individual) (VATBIL) Export Declaration Form (CUSDEC) 32Million 20Million 12Million 11Million 11Million
15 2-3. Transaction per Business Categories(Continued) Trade Finance/License & Certificates - 211Documents, 49.7 Million Transactions(13.4%) Tax Bill(TAXBIL) Bill(INVOIC) Tax Receipt Notice(GENRES) Certificate of Purchase Confirmation on raw materials for Export Goods(PCRLIC) Purchase Confirmation Application on raw materials for Export Goods(APPPCR) 17Million 7.9Million 3Million 2.7Million 2.4Million
16 2-3. Transaction per Business Categories(Continued) Others - 19 Documents and 67Million Transaction(18.1%) General Response on Tax Bill (GENRES) General Response (GENRES) 58 Million 8.7 Million
17 2-4. Transaction per Frequency Less than 100K 7Docs. 162,232K 43.8% Unit : 1,000(K) Transaction 100K ~ 1Million 135Docs 46,269K 12.5% 1Million ~ 10 Million 50Docs. 155,702K 42% Over 10Million 7Docs. 162,232K 43.8% Total 628 e-docs & 370,629,000 transaction
18 2-5. Best Practice of Paperless Trade Hyundai Motor Export Case 1. Purchase Overseas Hyundai Dealer Opening Bank 2. Letter of Credit (e-l/c) Advising Bank Order KTNET Paperless Trade Single Window 8. Shipping Document Presentation Nego Bank 7. Certificate of Origin (Peru Korea FTA) 3. Local L/C 4. Export Declaration 5. Shipment 6. Cargo Insurance
19 3 Port Community System with Paperless Trade
20 3-1. Paperless Trade Single Window with Border Security Private Sector OGAs & Regulatory Authorities Public Sector * ASPLine : Electronic licensing & Certification System developed and operated by KTNET 3 4 Manage and issue the license & Certification in ASPLine types of e-documents 4 Notify the Result Apply for 3 e-licensing & Certification Apply for e-licensing & Certification Customs Declaration Notify the Result Trading Co. Declarant 2 B2B, B2G, G2B, Global Service National Single Window 6 Manifest 8 & B2G 7 National e-customs system API Trading Communities Global Service Ministry of Oceans & Fisheries Airlines Ocean Carriers Customs Forwarders Bonded Bonded Brokers Banks Insurances Trading Communities in Transportation Warehouse overseas countries YES U-Port (National PCS) Korea Immigration Service Integrated Korean Single Window Model
21 3-2. Overview of YES U-Port YES U-Port is National Port Community System operated by Ministry of Oceans and Fisheries of Korea Port-MIS : Port Management Information System for paperless e- Port Service and Logistics EDI Network Service SP-IDC : Data Warehouse Management, Statistics, and Analysis for Port Logistics Information Information Management Service Security & Safety PSS : Port Entry, Exit and Access Control & Management System VMS: Vessel Management System Real-time Tracking DR Disaster Recovery GCTS : Global Container Tracking System utilizing RFID
22 3-3. Port-MIS Definition PORT-MIS is the computerized management system that handles vessel and cargo movement activities in and out of ports. The PORT-MIS network comprises two areas of port management information system and logistics EDI network system. System Contents Vessel Control Vessel arrival/departure Berth control Vessel traffic control Tugboat/pilot control Systemized management for efficient vessel s arrival/departure Systemized berth management Systemized management for vessel arrival/departure and movement status in the port Systemized management to prevent damages and accidents inside port Cargo Control Billing Statistics & Analysis Cargo loading / discharging management Dangerous goods management Systemized management for cargo/container loading and discharging Systemized management for dangerous goods Automatic accounts of harbor dues and cargo handling fees etc. Automatic accounts of harbor dues and cargo handling fees etc.
23 3-4. Nationwide Network of Yes u-port Basic and detailed designs : 1986 ~ 1991 Started the on-line system in Busan port : Constructed system in the Yeongnam area : Applied the system in Incheon port : Extended the system into the Honam and Gyeongin area: Became the National Port Operation Information System: ~ Present Constructed the integrated D/B system: Constructed Port-MIS in Busan Port Authority(BPA): Constructed Port-MIS in Incheon Port Authority(IPA): Constructed Port-MIS in Ulsan Port Authority(UPA):
24 3-5. GCTS (Global Container Tracking System) Real-time port logistics tracking and management system with RFID Outline of GCTS
25 3-6. Yes U-Port EDI Service-Export Cargo No Name of e-doc. EDIFACT User 1 Cargo Manifest(Ocean Export A Type) SMA 2 Breaking Bilk cargo manifest (Ocean Export B Type) CUSREP/ CUSMAN CUSREP/ CUSMAN Shipping line MFCS Forwarder MFCS 3 Sea departure report DEOVAD Shipping line Customs 4 Attendant List PAXLST Airline Customs 5 Cargo manifest(ocean Export C Type) SMC CUSMAN MFCS Customs 6 Shipping Request (S/R)(Sea) SHPREQ Shipper Forwarder/Shipping line 7 Bill of lading Notice issued(sea) BLADVI Forwarder/Shipping line Shipper 8 Charge freight INVOICE AWBINV Forwarder/Shipping line Shipper
26 3-7. Yes U-Port EDI Service-Import Cargo No Name of e-doc. EDIFACT User 1 Arrival report(sea) DEOVAD Shipping line Customs 2 Passenger list(sea) PAXLST Shipping line Customs 3 Cargo manifest(ocean Import A Type) 4 Cargo manifest(ocean Import B Type) CUSREP/ CUSMAN CUSREP/ CUSMAN Shipping line MFCS Forwarder MFCS 5 Cargo manifest(ocean Import C Type) CUSMAN MFCS Customs 6 Disembarkation report CUSAGD Shipping line MFCS Customs 7 Import declaration CUSCAR Bonded yard Customs 8 Export declaration CUSBRR Bonded yard Customs 9 Declaration of Bonded Transportation CUSMOV Bonded transport company Customs 10 Bonded Transportation approval CUSMOV Bonded transport company Customs 11 Goods in stock Request for information IVNINF Bonded transport company(terminal company) MFCS 12 Delivery Order note(cancellation notice) GODAPP Forwarder Bonded area 13 Integrated import cargo manifest(a Type) 14 Integrated export cargo manifest(a Type) CUSREP/ CUSMAN CUSREP/ CUSMAN Shipping line Customs / Ministry of Maritime Affairs and Fisheries Shipping line Customs / Ministry of Maritime Affairs and Fisheries
27 3-8. Yes U-Port EDI Service-B2G Logistics No Name of e-doc. EDIFACT User 1 Sea-Going Vessel Report departure/permit DEOVAD 2 Crew list/passenger list PAXLST 3 Port Facilities Use report DECUSE 4 Port Facilitates License (Application) APPFCL 5 Forced pilotage exemption application EMPPLT 6 Domestic Line Vessel Report departures DEOCOS 7 Container Status of export or import CONREP 8 Status of export or import cargo CGOREP 9 Laid-up application SHREPR 10 Launch/entering a dock/undocking declaration SMPLAU 11 Towage application APTUGT Shipping line Maritime Affairs & Port Administrator/Ministry of Justice Shipping line Maritime Affairs & Port Administrator/Ministry of Justice Shipping line Maritime Affairs & Port Administrator Shipping line Maritime Affairs & Port Administrator Shipping line Maritime Affairs & Port Administrator Shipping line Maritime Affairs & Port Administrator Shipping line Maritime Affairs & Port Administrator Shipping line Maritime Affairs & Port Administrator Shipping line Maritime Affairs & Port Administrator Shipping line Maritime Affairs & Port Administrator Shipping line Maritime Affairs & Port Administrator
28 3-8. Yes U-Port EDI Service-B2G Logistics(Continued) No Name of e-doc. EDIFACT User 12 Ferry service application APPILT 13 A summary sheet CGOSUM 14 Radio check application REQRTS 15 Coastal cargo status of export or import INCAGO 16 Coastal Container Status of export or import INCONT 17 Hazardous Carry-In Report/Confirmation CARDGN 18 Hazardous Schedules DGMNFT Shipping line Maritime Affairs & Port Administrator Maritime Affairs & Port Administrator Shipping line Shipping line Maritime Affairs & Port Administrator Shipping line Maritime Affairs & Port Administrator Shipping line Maritime Affairs & Port Administrator Shipping line Maritime Affairs & Port Administrator Shipping line Maritime Affairs & Port Administrator 19 Foreign sailors a landing card ARNOFE Shipping line Ministry of Justice 20 General response GENRES 21 Usage fee list PCGNOT 22 Freight charges docked payment by proxy expense bill WARPQT Maritime Affairs & Port Administrator/ Ministry of Justice Shipping line Maritime Affairs & Port Administrator Shipping line Shipping line Maritime Affairs & Port Administrator
29 3-8. Yes U-Port EDI Service-B2G Logistics(Continued) No Name of e-doc. EDIFACT User 23 Export or import cargo declaration MACAGO 24 Multiple responses MTIRES Shipping line Maritime Affairs & Port Administrator Maritime Affairs & Port Administrator Shipping line
30 3-9. Yes U-Port EDI Service-B2B Logistics No Name of e-doc. EDIFACT User 1 Import / export system COPINO Bonded transport company Hyundai Terminal 2 Container Export or import Log (Hyundai Terminals) CODECO 3 Container Export or import Log(Korea Express) CODECO 4 Empty Container Export Booking COPARN 5 Response Document(Reservation Request) APERAK 6 Empty Container Specify export information COPARN 7 Full Container Export Booking COPARN 8 Response Document(Reservation Request) APERAK 9 Full Container Specify export information COPARN Bonded transport company Terminal Bonded transport company Korea Express(private company) Bonded transport company Korea Express(private company) Korea Express(private company) Bonded transport company Korea Express(private company) Bonded transport company Bonded transport company Korea Express(private company) Korea Express(private company) Bonded transport company Korea Express(private company) Bonded transport company
31 4 Major Milestones and Benefits
32 4-1. Milestones of Paperless Trade in Korea Organizing SOC Investment Planning Board under President Establishing KTNET Launching Commercial Service(VAN/EDI) Organizing National Paperless Trade Promotion Committee(Chair: Prime Minister) Launching Full Internet-based Platform 'utradehub (Internet/XML)
33 4-2. Principles of Promoting Paperless Trade 1. Appropriate Organization for Consensus of stakeholders SOC Investment Planning Board under President (1990) National Paperless Trade Promotion Committee(2003) : Chairman Prime Minister Accredited Credible 3 rd Party Service Provider with specialty : KTNET 2. Legal Framework Act on the Promotion of Paperless Trade : Paperless Trade Basic Infra Provider Customs Act : e-customs Service Provider Digital Signature Act : Accredited Certified Authority Framework Act on Electronic Commerce : Certified Electronic Document Authority Revision of Commercial Act : e-b/l Title Registry Foreign Trade Act : Purchase Confirmation of raw materials for Export Goods Service Agency 3. Government leaded Public-Private Partnership Government Initiative to build up Nation Wide Service Platform Public-Private Partnership : Industry Associations on behalf of Individual firms
34 4-3. Organization for Paperless Trade Facilitation Goal Full online/automated seamless trading procedures through operation of Paperless Trade promotion system 1. Policy Decision : National Paperless Trade Promotion Committee 2. Policy Setup/Implementation 3. Execution : Accredited Paperless Trade Basic Infra Service provider (Act on the Promotion of Paperless Trade) 4. Participation & Cooperation from Public Stakeholders and Trade Community
35 4-4. Benefits of Paperless Trade Trade Procedure Simplification and Gov t Administration Transparency Conventional Trade Off-line and Multi-Window Non-Standard Paper Documents Repeated Submission Vulnerable to counterfeit & falsification Paperless Trade On-line and One-Stop Single Window Unified and Standard e-documents One time Submission Anti-Counterfeit & Anti-Falsification Economic Benefits : US$5.42 Billion/year(KITA, 2010) Competitiveness of SME s & Contribution to Sustainable Economic Growth (Billion US$) Small & Medium sized Enterprises Export Volume (Y) 2000(Y) 2005(Y) 2010(Y) 2014(Y) [Small and Medium Business Administration of Korea]
36 5 Pan Asian e-commerce Alliance
37 5-1. PAA Members 1. China : CIECC 2. Hongkong, China : TradeLink 3. Indonesia : PT EDI Indonesia 4. Japan : NACCS 5. Korea : KTNET 6. Macau : TEDMEV 7. Malaysia : DagangNet 8. Philippines : InterCommerce 9. Singapore : CrimsonLogic 10. Taiwan Province, China : Trade-Van 11. Thailand : CAT Telecoms
38 5-2. The PAA Mission To enable secure and reliable transmission of trade and logistics data and documents. To allow inter-connection of network services to provide e-commerce transaction application services for the trade business community. To create a Pan-Asian portal to enable global B2B connection and communication.
39 5-3. PAA s Framework for Cross-Border Transaction PAA Legal Framework Region A Region B PKI Mutual Recognition Certificate Policy PAA Policy Authority Recognition Agreement Certification Authority A Certification A uthority B CA Service Secure Cross Border Transaction Services CPS-A End User A Subscriber Agreement-A Service Provider A PAA Club Agreement Interconnect Agreement CPS-B End User B Subscriber Agreement-B Service Provider B *CPS: Community CA Certification Practice Statement
40 5-4. Korea-Japan Cross-Border Transaction Pilot Project Korea-Japan e-trade Hub Project Shinsung Shipping (SS) 8 Contract Acknowledgement Agent of SS 9 Loading NSK 14 Unloading 8 Shipping Order 10 B/L Issue 6 Product Info. 2 Order Input 8 Shipping Request Hyundai Motor K T N E T 1 Purchase Order 3 Offer 6 Product Info 8 Shipping Request 13 B/L, I/V, P/L W/List, M/Sheet T E D I Mitsubishi Corp. 4 L/C Opening 12 Payment 11 NEGO KEB 5 L/C Opening Acknowledgement (SWIFT) 11 Payment Request (SWIFT) BOTM
41 5-5. Korea-Taiwan e-c/o Transaction e-c/o: APEC ECSG Pathfinder Project KCCI ECO Enquiry on KCCI Website With ID and Password Customs Exporter CO APP ECO (for view) Inv, P/L CO APPORG (specify ECO Number) KTNET Repository ECO CERTIF Inv, P/L, Attach ECO from repository Trade-Van Repository Import Declaration ECO confirmed by importer Inv, P/L, ECO Sign to confirm ECO Assign Customs Broker Generate Import Declaration Data Importer Import Declaration Customs Broker Korea Chinese Taipei
42 6 Knowledge Share for Seamless Paperless Trade
43 6-1. Critical Factors for Integrated Single Window Critical Factors While stakeholder coordination in Single Window implementation may require different approaches depending on country circumstances, there are Six(6) Common Critical Factors, or to-do s that should be taken into account. Common Critical Factors
44 6-2. Lessons Learned Korean Case Korean Case: Standing National Paperless Trade Committee National Paperless Trade Committee Private Sector Paperless Trade Committee Chair : Prime Minister Administrative Committee Secretariat : KITA Chair : Vice Minister of MOCIE Korea Paperless Trade Facilitation Center Platform W/G Law W/G Finance W/G Logistics W/G Marketing W/G Global W/G
45 6-3. Vision Realization via Knowledge Share KTNET s Vision : Realizing Seamless Paperless Trade Globally Knowledge Share is Must-do for realization of the Vision Support Countries on demand to be ready for Paperless Trade through knowledge transfer and experience share Successful Implementation of Trade SW fitting for Adopting Countries Environment : Tailor-made development Support Legal Framework ready for operation Mutual Cooperation for Cross-Border Transaction between Foreign SW s and utradehub Constant Exchange of HR and Policies on Paperless Trade and e-government
46 6-4. Sharing Korean Experiences with the World MONGOLIA FRANCE TUNISIA T GHANA T ROMANIA KAZAKHSTAN S S S S C AZERBAIJAN C C C C T C C KYRGYZ C S S S UZBEKISTAN T IRAQ LIBYA CHINA T T TAIWAN HONG KONG TANZANIA C C T C PHILIPPINES S S SRI LANKA T MALAYISIA C SINGAPORE C DOMINICA REPUBLIC S SOUTH AFRICA PERU C CHILE C S C T System Development : 5 Countries, 10 Projects Consulting : 14 Countries, 15 Projects Technology & Solution : 7 Countries, 8 Solutions
47 Don LEE/Team Manager
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