IT Support for TFA Implementation Speed & Quality : Japanese Way of Trade Facilitation and New Technology for Future

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1 IT Support for TFA Implementation Speed & Quality : Japanese Way of Trade Facilitation and New Technology for Future WCO IT Conference & Exhibition Bahamas, 6-8 May 2015 Presented by: NACCS Center NTT DATA Corporation 1

2 2 Agenda 写真は要検討 ( 最新物流 ) 1. Introduction and Overview NACCS Center and NTT DATA 2. How we can contribute to global trade facilitation Section 1. Trade Facilitation in Japan Section 2. Our Capabilities in other Markets Section 3. New Technologies for the Future

Automated Cargo and port Consolidated System, Inc.

3 Today s Presenters 3 Toshihiko Miyasaka Kenji Nagai President and Chief Executive Officer Nippon Automated Cargo and port Consolidated System, Inc. Executive Manager, Public Sector NTT DATA Corporation

4 Introduction of NACCS Center 4 NACCS Center is a government-funded entity that operates a joint public and private sector system Users User Friendliness Stability, Reliability NACCS Development In International Logistics Efficiency, Economy NACCS plays a role of a comprehensive logistics information platform in int l distribution of Japan

Introduction of NACCS Center 5 AFR operation with foreign SPs - Following the WCO SAFE Framework, the Advance Filing Rules (AFR) on Maritime Container Cargo has

- NACCS Center has managed and operated the data transmission / processing system for the AFR, by connecting with foreign Service Providers.

5 Introduction of NACCS Center 5 AFR operation with foreign SPs - Following the WCO SAFE Framework, the Advance Filing Rules (AFR) on Maritime Container Cargo has started since March NACCS Center has managed and operated the data transmission / processing system for the AFR, by connecting with foreign Service Providers. (Note: Under AFR, Japan Customs requires shipping companies / NVOCCs to file detailed cargo information (Manifest data) electronically 24hrs before departure of a vessel from a loading port.) Outside Japan Filers - Carrier - NVOCC Good example of int l collaboration on TF In Japan NACCS Japan Customs 19 Service Providers

) - NACCS Center supports both governments as a consultant - Moreover, NACCS Center offers technical assistances Grant Agreement JICA Progress

6 6 Introduction of NACCS Center NACCS-type customs clearance system abroad - Introduced in Vet Nam in April 2014 Start system development in Myanmar since October 2014 (Note: These projects are implemented under the grant aids by JICA, Japan International Cooperation Agency.) - NACCS Center supports both governments as a consultant - Moreover, NACCS Center offers technical assistances Grant Agreement JICA Progress Report Customs Department of Vietnam / Myanmar Consultant Agreement NACCS Center Software Developer Contracts Hardware Vender Support in managing project

7 7 NACCS and NTT DATA -Planning & operation of NACCS in Japan -Consulting services for online trade systems in Vietnam & Myanmar -Development & maintenance of NACCS in Japan - Development of online trade system in other countries including Vietnam and Myanmar. Int l Projects with GOVs and SPs

8 Today s Presenters 8 Toshihiko Miyasaka Kenji Nagai President and Chief Executive Officer Nippon Automated Cargo and port Consolidated System, Inc. Executive Manager, Public Sector NTT DATA Corporation

NTT Group at a glance Global IT and telecommunications

in total revenue All facts and figures accurate as of

coverage in presence in 196 countries countries and

9 NTT Group at a glance Global IT and telecommunications services company IT Services Other Business $112 billion in total revenue All facts and figures accurate as of March ,000 employees worldwide Network Direct coverage in presence in 196 countries countries and regions and regions Ranked #1 in Data Center Ranked 79 #53 in Fortune Global 500 9

10 10 NTT DATA: Global Coverage 76,000+ employees 175 cities 41 countries EMEA Employees 14,000 APAC Employees 11,000 China Employees 4,000 Japan Employees 33,000 AMERICAS Employees 14,000 As of Mar. 2015

11 11 Global Project: the Vatican Apostolic Library - NTT DATA was selected by the Vatican Apostolic Library to participate in its project to digitize and archive historic assets of humanity. - NTT DATA is to digitize manuscripts, build and operate the digital archive systems for the Vatican Apostolic Library.

12 Global Capability 2 NTT DATA Global SAP Template AMS Partner for Daimler Germany

Consolidation Across 4 Global Centers Turkey Center Central Roll-in Support India

Level 3; SAP BASIS; SAP Development; Central Roll-in Services.

12 12 Global Capability 2 NTT DATA Global SAP Template AMS Partner for Daimler Germany NA Center Mexico Center (Planned) Central Roll-in Global-Wide IT Business Consolidation Across 4 Global Centers Turkey Center Central Roll-in Support India Center Central Roll-in Support NTTD HQ - Governance Global SAP Operations Level 2, Level 3; SAP BASIS; SAP Development; Central Roll-in Services. 154 FTEs (240 by the end of 2015) T&M 35; Managed Services FTEs (120 by the end of 2015) 3 FTEs (10 by the end of 2015)

13 13 Agenda 写真は要検討 ( 最新物流 ) 1. Introduction and Overview NACCS Center and NTT DATA 2. How we can contribute to global trade facilitation Section 1. Trade Facilitation in Japan Section 2. Our Capabilities in Global Markets Section 3. New Technologies for the Future

14 Section 1. Trade Facilitation in Japan 14

# of Customs staff Nearly the same 1978:8077 staff 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 NACCS implemented in 1978 has delivered the following benefits:

15 Imports/exports keep growing in Japan Import /Export Declaration(Unit: 1000) Customs Staff Significantly increased in the past 35 years Fact1. # of Imp/Exp Declaration grew by 557% But Fact 2. # of Customs staff Nearly the same 1978:8077 staff 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 NACCS implemented in 1978 has delivered the following benefits: Expeditious Customs Procedures High Speed 0 5,678 the 6th largest in the world 37, ,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 Secure & Safety Operation High Quality 0 Export Import Customs Staff 2012:8778 staff Sources "Ensuring Peoples Annexes" by Japan Customs "ANNUAL REPORT " by WCO 15

16 Strong Points of NACCS 16 5 Key Features Expeditious Customs Procedures Secure & Safety Operation 1 Reuse of Data & Full Automation 3 Advanced Screening 2 Highly Integrated with OGAs 4 Secure E-Tax payment Total support for 1-4 features 5 High Level of Service (High Availability, High Performance)

17 1. Reuse of Data & Full Automation Reuse of Data: Users can use information registered by other users 2. Automation: Prompt & accurate processes can be performed End-to-End Port clearance Registration of Cargo info Application for OGAs Customs declaration Re-Use NACCS Single Input Re-Use of Info + Additional data + International Standards Automation Fully Automated Automated Screening Automated Tax Determination E-Tax Payment Note: Except for cases manual operation required.

18 2. Highly Integrated with OGAs Completely integrated Single Window 1. OGAs procedures can be processed inside NACCS 2. Real-time seamless end-to-end transaction from applicants to OGAs 3.

18 18 2. Highly Integrated with OGAs Completely integrated Single Window 1. OGAs procedures can be processed inside NACCS 2. Real-time seamless end-to-end transaction from applicants to OGAs 3. Reporting & Analysis modules available for staff in the organizations Single Window (OGA Procedures inside NACCS) Applicant Customs Procedures Customs Single Window Port Procedures Port admin Harbor master District Transport Bureaus Maritime Safety Agency Marine Traffic Center Quarantine (Animal, Food, Plant) Animal quarantine station Food quarantine station Plant quarantine station Authorized Inspection agency Quarantine station (man) Trade Control Crew Landing Support Immigration Pharmaceutical Affairs Security Division Justice Division Immigration Division Pharmaceutical Division

19 2. Highly Integrated with OGAs 19 Completely integrated Single Window 1. OGAs procedures can be processed inside NACCS 2. Real-time seamless end-to-end transaction from applicants to OGAs 3. Reporting & Analysis modules available for staff in the organizations Applicant NACCS Procedures Customs Procedures Trade control Port EDI Animal quarantine Crew landing support Plant quarantine Immigration Pharmaceutical Affairs Food quarantine etc. OGA Ministry of Health, Labor, and Welfare Procedures Clearance Linkage Modules Application Modules Screening Modules Examination Modules Report & Analysis Statistics Modules Analysis Modules Law Search Modules OGAs

20 2. Highly Integrated with OGAs Agriculture Quarantine Animal Quarantine Food Quarantine Customs Approval from 4 Organization is required Parallel Operation by NACCS Can

20 20 2. Highly Integrated with OGAs Agriculture Quarantine Animal Quarantine Food Quarantine Customs Approval from 4 Organization is required Parallel Operation by NACCS Can Process Concurrently and Asynchronously Agriculture Quarantine Food Quarantine Animal Quarantine CUSTOMS Total Status Control in NACCS Clearance!! Quick Operation by NACCS

3. Risk Management by Advanced Screening 21 Speedy & more effective automatic screening 1. Risk analysis based on huge data stored in risk management system 2.

21 3. Risk Management by Advanced Screening 21 Speedy & more effective automatic screening 1. Risk analysis based on huge data stored in risk management system 2. Real time screening in one single transaction (Transaction time (for declaration up to clearance): only a few seconds at shortest) <Screening Flow> Applicant NACCS Import/Export Screening declaration Automation (The shortest time: only a few sec) Risk Management System Screening Criteria Immediate Release Document Examination Physical Examination Green Channel Yellow Channel Red Channel Features - Vast amounts of data: 800 tables TB-class data size - High-speed processing - Advanced analysis

4. Secure & Accurate E-Tax payment 22 Automated tax calculation & E-Tax

Accurate tax collection without leakage <Payment Flow> Applicant

Determination of Tax rate Determination of Total tax amount Tax info

22 4. Secure & Accurate E-Tax payment 22 Automated tax calculation & E-Tax Payment contribute to 1. Prompt payment operation 2. Accurate tax collection without leakage <Payment Flow> Applicant Declaration Clearance NACCS Automated Tax Determination <Process> Determination of Tax rate Determination of Total tax amount Tax info E-Tax Payment Notice of payment Bank Applicant s Bank account National treasury s account No Manual Intervention

23 5. High Level of Service 23 A high level of service availability and performance supports faster customs procedures & secure tax collection <NACCS Offers High Level of Service> High Availability High Performance - 24/7 operations - Service Level: 99.99% - Disaster recovery (in case of disaster, business continuity can be supported by the back-up data center) - Average online processing time: Only 0.1 sec order (in NACCS server) *

24 24 Section 2 Our Capabilities in Global Markets

25 Global Capabilities in Customs Domain 25 Project Experience in 15 countries Andorra Japan US Myanmar Vietnam Philippines Indonesia Guatemala Honduras El Salvador Nicaragua Costa Rica Peru Columbia Chile As of Mar Customs system (NSW) OGA system Consulting Regional SW Border Security Support

26 Activities in ASEAN (Vietnam & Myanmar) Leveraging

Myanmar (MACCS) Project period Aug, 2012 Mar, 2014 The

operations - Highly contributing to Vietnam Trade

26 26 Activities in ASEAN (Vietnam & Myanmar) Leveraging expertise gained in Japan (NACCS) 1.Vietnam (VNACCS) 2. Myanmar (MACCS) Project period Aug, 2012 Mar, 2014 The current status - Implemented across the country Stable operations - Highly contributing to Vietnam Trade Facilitation Project period The current status Oct, 2014 ongoing Making progress smoothly.

Central Regional Single Window (SIECA) Overview Regional Distributed System(Food & Beverage) Purpose Integration Global Standard Automation of sanitary registration procedures Sharing certificate of

27 Central Regional Single Window (SIECA) Overview Regional Distributed System(Food & Beverage) Purpose Integration Global Standard Automation of sanitary registration procedures Sharing certificate of free sales Integration of existing customs systems Pre-Defined BUS Architecture by WB WCO Data Model v 3.0 Guatemala Regional Distributed System Data Sharing Honduras El Salvador Nicaragua Costa Rica 27

optimize US border security technologies NTT DATA evaluates complex,

28 Security Borders DHS Customs and Border Protection Secure Border Initiative Providing full lifecycle Independent Verification & Validation (IV &V) to optimize US border security technologies NTT DATA evaluates complex, integrated Secure Border technologies and provides recommendations for improvement. 28

29 29 Section 3 New Technologies for the Future

NTT DATA Technology Foresight 2015 30 Outlook and technology trends of the near future Derived by

Key Technology Trends for Customs Domain Challenge of Artificial Intelligence Cloud Optimization

30 NTT DATA Technology Foresight Outlook and technology trends of the near future Derived by NTT DATA once a year Targeted 12 Trends in Information Society Trends 8 Technology Trends 2 Key Technology Trends for Customs Domain Challenge of Artificial Intelligence Cloud Optimization NTT DATA Technology Foresight

Big Data Analysis & AI for Customs Screening Issues Data Volume for screening

First (Find Unknown Rule) Approach Rapid 10 Learning rules from Past Instances

Analytics Oracle CEP IBM Streams Real-time Analysis Process by the rules given

31 Big Data Analysis & AI for Customs Screening Issues Data Volume for screening UP Big Data More complexity NTT s offering technology Deep Learning World s First (Find Unknown Rule) Approach Rapid 10 Learning rules from Past Instances & Real-time Burden on Customs Officers UP Batch Known Rule-Based Advanced Analytics Oracle CEP IBM Streams Real-time Analysis Process by the rules given <Benefits> 1. Improvement of Screening Criteria 2. Support the Analysis of Customs Officers 31

32 Cloud Computing Approach for Customs On Premise Current approach Cloud Computing NTT s

Info Batch base Real Time Application (High response) Edge Computing PF A country C country B

Maintenance cost 3. Flexibility < Issues > 1. Confidentiality 2. Location of data 3.

32 32 Cloud Computing Approach for Customs On Premise Current approach Cloud Computing NTT s offering technology Edge Computing A country B country A B C NW Back-End Cloud Open/Shared Info Batch base Real Time Application (High response) Edge Computing PF A country C country B country C country A country B country C country Secure/ Hi response < Issues > 1. H/W cost 2. Maintenance cost 3. Flexibility < Issues > 1. Confidentiality 2. Location of data 3. Heavy load on N/W < Features > 1. High Availability 2. Cost Effective 3. Flexible Operation 4. Simple Implementation

33 Conclusion 33 Section 1. Trade Facilitation in Japan High Speed,Quality and Secure SW in Japan Section 2. Our Capabilities in Global Markets ASEAN, Latin America Section 3. New Technologies for the Future New Value with our new technologies Our Offering Contribution to Global Trade Facilitation

34 34 Contact NTT DATA Corporation Sales team Exhibition booth: #29 Thank you

26 September 2014, BITEC Bangkok, Thailand

APTFF Capacity Building Workshop on Implementing Trade Facilitation Measures: Perishable Goods & Single Window 26 September 2014, BITEC Bangkok, Thailand Japan s Effort on Trade Facilitation concerning