The SAFE Framework of Standards

1. The SAFE Framework of Standards Bob Struthers World Customs Organization Training on the New EU Implementations on Road Transport and Foreign Trade: Istanbul Turkey 25-26 June 2009

2. The World Customs Organization (WCO) is the only intergovernmental organization with competence in Customs matters.

3. Facts and Figures • Established in 1952 as the Customs Co-operation Council • Renamed WCO as working title in 1994 • Headquarters in Brussels • 6 regional representatives • Currently representing 174 members from all geographic regions and at different stages of development • Members process > 98% of all international trade

4. WCO SAFE Framework • Recognition of risks to the security and facilitation of the international trade supply chain led the WCO to take bold action. • WCO Council Resolution, June 2002, forming a Joint Customs-Industry Task Force on Security and Facilitation.

5. SAFE Framework of Standards • Adoption at the Council in June 2005 • Framework • Letter of Intent to implement the Framework • 156 WCO Members make commitment to implement • Revised version published in 2007

6. Core Elements of SAFE

7. Two pillars • The WCO Framework rests on two twin pillars: • Customs-to-Customs network arrangements. • Customs-to-Business partnerships. (Authorised Economic Operator (AEO) concept)

8. Objectives of the Framework Certainty and predictability at a global level Integrated supply chain management for all transport modes Allow Customs to meet the challenges of the 21st Century Closer cooperation among Customs administrations Stronger Customs-to-Business cooperation Tangible benefits for businesses Seamless movement of goods 8

9. Pillar 1Customs-to-Customs 9

10. Pillar 1 covers the following: Integrated Supply Chain Management Cargo Inspection Authority Modern Technology in Inspection Equipment 10

11. Pillar 1 continued: 4) Risk Management 5) High-risk Cargo or Container 6) Advance Electronic Information 7) Targeting and Communication 11

12. Pillar 1 continued: 8) Performance Measures 9) Security Assessments 10) Employee Integrity 11)Outbound Security Inspections 12

13. All the containers bound to US Starting from 1 July 2012 Possibility to extend the date of application for 4 additional years Pilot projects in 3 ports: Port Qasim, Pakistan Port Cortes, Honduras Southampton, UK US SAFE Port Act H.R. 4954 13

14. Pillar 2Customs-to-Business 14

15. Authorized Economic Operator in the SAFE Program • “A party involved in the international movement of goods in whatever function that has been approved by or on behalf of a national Customs administration as complying with WCO or equivalent supply chain security standards. Authorized Economic Operators include inter alia manufacturers, importers, exporters, brokers, carriers, consolidators, intermediaries, ports, airports, terminal operators, integrated operators, warehouses, and distributors.”

16. Pillar 2 covers the following: Partnership- ensure that their internal policies and procedures provide adequate safeguards against the compromise of their shipments and containers Security - incorporate pre-determined security best practices into their existing business practices. 16

17. Pillar 2 continued: 3) Authorization -The Customs administration, together with representatives from the trade community, will design validation processes or quality accreditation procedures that offer incentives to businesses through their status as Authorized Economic Operators. 4) Technology- maintain cargo and container integrity by facilitating the use of modern technology. 17

18. Pillar 2 continued: 5) Communication -The Customs administration will regularly update Customs-Business partnership programs to promote minimum security standards and supply chain security best practices. 6) Facilitation - The Customs administration will work co-operatively with Authorized Economic Operators maximize security and facilitation 18

19. Authorized Economic Operator Requirements and benefits • 2007 supplement introduced: • 13 detailed AEO requirements sections (e.g. cargo, conveyance, premises security) • Section listing possible benefits (eg reduced data sets, minimum number of cargo inspections etc) • Validation and Authorization procedures

20. AEO and Mutual Recognition • A WCO Member Customs administration recognizes the AEO authorization system in another WCO Member Customs administration as equivalent to its own • Standardized approach to AEO authorization in SAFE provides a solid platform for the development of international systems of mutual recognition of AEO status - bilaterally, sub–regionally, regionally and, in the long term, globally

21. AEO and Mutual Recognition • Will afford the foreign AEO the same benefits as a national AEO • Improve predictability and efficiency of operations • Tangible benefits to trade a challenge: Mutual Recognition widely regarded as the ‘holy grail' of benefits.

22. Members’ AEO Programmes • EU AEO • US Customs Trade Partnership Against Terrorism (C-TPAT) • Canada’s Partners in Protection • Jordan’s Golden List • Singapore’s Secure Trade Partnership • Malaysia’s Customs Golden Client • Japan’s AEO Programme • New Zealand’s Secure Exports Scheme (SES) and • China’s AEO Programme • Korea’s AEO Programme

23. Members’ AEO Programmes • ….but bear in mind that 156 WCO members have committed to Implement SAFE! • Major , ongoing Capacity Building support required (Columbus Programme)

24. Current Developments • Compendium of AEO programmes, including Mutual Recognition Arrangements (MRA), to raise awareness of other programmes • Guidance “How to set up an AEO Programme” • SMEs and AEO

25. Scope and Objectives of the Research (AEO Compendium) • Since June 2005 156 Members have signed SAFE Framework to Secure and Facilitate Trade; • Research Objective: to evaluate the progress in Pillar II on AEO implementation; • Data used: in-house information (reports; previous questionnaires, open search) and targeted requests to Members; • Scope of study: • 40 programmes in 67 countries (due to EU-27 that has a single programme) on all continents • 25 programmes identified for targeted approach • Information is being verified through the national administrations (personalised requests) • Database of AEO contact persons is being formed

26. AEO Typology I (25 programmes) • Programme type: • Security/customs compliance – 14 • Security – 5 • Customs compliance – 6 • Type of operator: • importers, exporters, logistic operators (carriers, forwarders, shipping companies, airlines), customs brokers, warehouse operators. Some countries (i.e. USA) included special categories for ports and foreign manufacturers. • Legislation: • all programmes envisaged voluntary participation in the programme. • most countries introduced amendments to their current legislation (mainly Customs Codes) or passed new legislation specifically for AEO; • some countries, like Canada, Singapore or Australia have not introduced any specific legislation to provide for an AEO.

27. AEO Typology II (25 programmes) • Further plans: • Development of new electronic applications; • Improvement of procedures; • Enlarging the scope of programme (import/export) or elaborating it to include more types of operators; • Adding a security component (for customs compliance programmes)

28. Mutual Recognition Arrangements Concluded MRA To be concluded Studies/consultations in place

29. And the future….? • Sustained Capacity Building Support • SAFE Survey • Case studies on AEO mutual recognition – best practice • Mutual Recognition Standards?

30. Thank you very much WCO SAFE Framework 30