Implementing Paperless Trade in GTR: ESCAP Policies and Programmes in Trade Facilitation

1. Implementing Paperless Trade in GTR: ESCAP Policies and Programmes in Trade Facilitation GTI International Capacity Building Programme for Trade Facilitation in NEA 20 - 24 February 2012 Cheonan City, ROK Sangwon Lim Trade Facilitation Section Trade and Investment Division, ESCAP

2. Trade Facilitation

3. Trade Facilitation and International Supply Chain International Supply Chain Reference Model

4. ESCAP Approach to Trade Facilitation Technical Regulation Security Customs • Capacity Building Procurement Efficient Global Trade Trade Facilitation Measures • Knowledge Sharing Distribution Payment • Advisory & Networking Certification Inspection Other Barriers

5. Trade Facilitation Initiatives in ESCAP: UNNExT UN Network of Experts for Paperless Trade in Asia-Pacific Region (UNNExT) “community of knowledge and practice to facilitate the implementation of Single Window and Paperless Trade in the Asia-Pacific region ” http://www.unescap.org/unnext/

6. UNNExT Structure

7. UNNExT Work Programmes and Activities Tools and Guides Development Capacity Building Knowledge Sharing Regional Advisory Service Research & Analysis

8. • Business Process Analysis (BPA) Guide for Simplification of Trade Procedures (Dec. 2009) • Data Harmonization & Modelling Guide ( Jan. 2012) Tools & Guides Development • National Workshops on Single Window and BPA, Mongolia (Sep. - Dec.09) • Workshop on Trade Facilitation & BPA Training, Cambodia (Jun. – Jul. 2010) Capacity Building • UNNExT Brief Series • Online Working Groups & Databases • Asia Pacific Trade Facilitation Forum Knowledge Sharing Regional Advisory Service • Mongolia Single Window Master Planning (2010/2011) • Nepal: Towards Single Window Environment & BPA (2011) • Regional Study on Improving Trade Procedures (Using BPA Guide) • Cooperation with the ARTNeT Research & Analysis

9. Step by Step Approach to Single Window Implementation

10. Who involved Procedures and Documents required Related Rules and Regulations Some quantitative indicators Business Process Analysis to Simplify Trade Procedures Business Process Analysis is a study to understand attributes of business processes, and their relationships

11. Benefits

12. Steps Phase I – Scope setting Step 1 – Define a project scope Step 2 – Develop a detailed work plan and secure resources Phase II – Data collection and process document Step 3 – Acquire background information Step 4 – Conduct interviews and document captured data Phase III - Problem analysis and recommendations Step 5 – Analyze the as-is processes and identify bottlenecks Step 6 – Develop and propose recommendations

13. Process Analysts Project Sponsor Project Manager/ Project Leader Process Participants/ Business Domain Experts Use Case Diagram for Big Picture Phase I 1) Define a project scope 2) Develop a detailed plan and secure resources Phase II 3) Acquire background information 4) Conduct interviews and document captured data Phase III 5) Analyze the “as-is” process 6) Develop and propose recommendations

14. Activity Diagram for Details Process Participants/ Business Domain Experts Project Sponsor Project Manager/ Project Leader 1.2) Conduct Desk research 1.1) Identify a business domain of interest 1.3) Identify core business processes and process participants 1.4) Visualize collected information Use Case Diagram 1.5) Review and provide feedback 1.7) Approve 1.6) Determine if revision is needed Revision not needed Revision needed

15. Use Case to Process Description Process Descriptions Activity Diagrams Use Case Diagrams

16. 1) Use case A Use Case to Time Procedure Chart 2) Use case B Time-Procedure Chart Process Descriptions Actor DD Actor DD Actor CC Actor BB Actor AA Actor AA Use Case Diagrams 3) Use case C Day 1 Day 5 1 Day 4 3 Days 3 2 1 0 Procedure (Use Case) 2) Use Case B 3) Use Case C 1) Use Case A

17. Time-Procedure Chart Example: Thai Frozen Shrimp Export Day 4 days 30 3 3 days 25 2.9 1 day 1 day 2.8 1 day 2.5 2.6 2.7 1 day 20 2.4 3 days 2.3 2.2 1. Buy - Conclude sales contract and trade terms 2.1. Have product sampled and examined 2.2. Arrange transport 2.3. Prepare export permit 2.4. Apply for cargo insurance 2.5. Prepare and submit customs declaration 2.6. Stuff container and transfer it to port of departure 2.7. Clear goods through customs 2.8. Handle container at terminal and stow it on vessel 2.9. Prepare documents required by importer as listed in L/C 3. Pay - Claim payment of goods 14 days 15 2.1 10 5 2 days 1 Procedure 0 1 2.1 2.2 2.3 2.4 2.5 2.6 2.7 2.8 2.9 3

18. Practical Recommendations • Convey the necessity of conducting of trade facilitation process analysis, especially with the top policy makers • Secure adequate resources to conduct BPA • Identify clearly the roles of stakeholders • Determine a capable lead agency • Start small, and then evolve • Profit from past experience • Invest in training • Use the BPA results for real improvement

19. Data Harmonization and Modelling for Streamlining Trade Data Alignment of domain, national or regional data to national, regional or international data set Elimination of unnecessary and redundant data Simplification Harmonization Standardization Progressing data set into national, regional or international standards through standard bodies

20. Simplification

21. Nat’l/Regional/Int’l Data Set Harmonization

22. Standardization Harmonized Data Standard Body Submit Nat’l/Regional/Int’l Standards Publish

23. Definition of Data Harmonization An act of reconciling the definition and representation formats of data elements in a domain of interest. It entails a set of activities that improves the consistency in the use of data elements in terms of their meaning and representation format. e.g.) Delivery Date

24. Scope of Data Harmonization

25. Outputs of Data Harmonization • A list of documents and electronic documents or messages that fall into the scope of the data harmonization project • A set of Data Dictionaries that corresponds to the identified list of documents and electronic documents or messages • National Standard Data Set that 1) consolidates data requirements listed in each Data Dictionary 2) contains standard semantic definition and representation format for each data requirement • A set of Message Implementation Guidelines for key documents that supports both UN/EDIFACT and/or XML messaging syntaxes

26. Benefits of Data Harmonization • provide common semantic standards for import, export and logistics information • decrease data redundancy and duplication • ensure data compatibility and enable data interoperability among stakeholders, resulting in further facilitation of trade procedures • preparation to develop electronic trade documents • support the establishment of Single Window facilities: a single entry point of standardized information and reuse of information to fulfill all import, export and transit related regulatory requirements

27. Step by Step Approach to Data Harmonization Step 4 Map (Reconcile) Step 3 Analyze Step 2 Define Step 1 Capture Step 0 Planning Business Process Analysis, Simplification & Harmonization

28. Step by Step Approach to Data Harmonization (Cont’d) • Step 1: Capture business processes and identify documents and basic data requirements • Step 2: Analyse data in each document and define the semantic of the data and the data formats • Step 3: Analyse data elements across various documents and organize them in a comparable manner • Step 4: Map/Reconcile data elements to the Reference Data Model • Step 5: Obtain the structure of the electronic document

29. Legal Framework for Enabling Paperless Trade and Single Window Environment UN/CEFACT Recommendation 35 • Legal Basis for SW Facility Implementation • Organizational Structure for SW Facility • Identification, Authentication & Authorization Procedure • Authority for Data & Conditions for Sharing Data in SW Facility • Data Quality Issues • Data Protection Mechanism • Liability Issues • Arbitration and Dispute Resolution Mechanism • Electronic Documents • Electronic Archiving • IPR and Database Ownership • Competition Issues

30. United Nations Commission on International Trade Law • UNCITRAL Model Law on Electronic Commerce • UNCITRAL Model Law on Electronic Signatures • United Nations Convention on the Use of Electronic Communications in International Contracts • Three Principles in e-Transaction • Non-discrimination of electronic transaction • Technological neutrality • Functional equivalence

31. ESCAP Legal Guide on Implementation of Electronic Single Window Facilities • Single Window Overview • General Legal Aspects of Single Window • Specific Legal Issues in Single Window - Basis for legal recognition of electronic communications - Authenticity and integrity - Data quality and interoperability - Data Retention, privacy and data protection - IPR, liability and dispute resolution • Assessment of Legal Gaps

32. Trade Facilitation Initiatives in ESCAP: APTFF Asia Pacific Trade Facilitation Forum (APTFF) An open regional platform to exchange information, experiences and practices for trade facilitation in Asia-Pacific, identify priority areas for regional cooperation and integration, and learn about new tools and services which can increase the efficiency of cross-border transactions.

33. Upcoming ESCAP Trade Facilitation Activities □ ADB-ESCAP Capacity-Building Workshop on Implementing a Single Window 23-27 April 2012, Seoul, ROK □ ECO-ESCAP Workshop on Trade Facilitation 23-25 May 2012, Kish Island, Iran □ APTFF 2012 and related events 1-5 October 2012, Colombo, Sri Lanka □ Feasibility Study on Modernization of Mongolia GASI (2012) □ Publication of UNNExT Guide on Legal Framework for Paperless Trade (Mid-2012)

34. Thank you www.unescap.org/tid www.unescap.org/unnext