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Centre for Customs & Excise Studies RAISING THE PORTCULLIS A Presentation to the WCO Conference on Developing the Relationship between WCO, Universities.

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Presentation on theme: "Centre for Customs & Excise Studies RAISING THE PORTCULLIS A Presentation to the WCO Conference on Developing the Relationship between WCO, Universities."— Presentation transcript:

1 Centre for Customs & Excise Studies RAISING THE PORTCULLIS A Presentation to the WCO Conference on Developing the Relationship between WCO, Universities and Research Establishments Brussels - March 2006 Prof. David Widdowson CEO, Centre for Customs & Excise Studies University of Canberra, Australia

2 Centre for Customs & Excise Studies  The traditional symbol of Customs  Symbolises a nation’s ports - the gates through which international trade must pass  Customs is the gatekeeper  ‘Gatekeeper’ approach traditionally implies intervention simply for the sake of intervention PortcullisPortcullis

3 Centre for Customs & Excise Studies  Customs must raise the portcullis to achieve an effective balance between trade facilitation and regulatory intervention  Intervention by Exception Intervention when there is a legitimate need to do so Intervention based on identified risk PortcullisPortcullis

4 Centre for Customs & Excise Studies Change in approach:  From ‘Gatekeeper’ strategies  To a balance between trade facilitation and regulatory control BALANCE Facilitation/ControlFacilitation/Control

5 Centre for Customs & Excise Studies BALANCE Facilitation/ControlFacilitation/Control The means of achieving the desired balance between trade facilitation and regulatory control is through the use of risk management

6 Centre for Customs & Excise Studies High Low RED TAPE APPROACH BALANCED APPROACH CRISIS MANAGEMENT LAISSEZ-FAIRE APPROACH CONTROLCONTROL FACILITATION High Facilitation/ControlFacilitation/Control

7 Centre for Customs & Excise Studies Facilitation/ControlFacilitation/Control

8 Revised Kyoto Convention  Simplification and Harmonisation of Customs Procedures  Contracting parties must integrate the principles of risk management into all Customs control programs

9 Centre for Customs & Excise Studies © David Widdowson 2004 Client Service Legislative Base Compliance Assessment Recognition Rewards Formal Warning Persuasion Penalty Enforcement RISK-BASED COMPLIANCE MANAGEMENT PYRAMID

10 Centre for Customs & Excise Studies Client Service Legal Base Assessment of Compliance Levels Enforcement/ Recognition Statutory Provisions - Relevant Laws - Regulations - etc.

11 Centre for Customs & Excise Studies Client Service Legal Base Assessment of Compliance Levels Enforcement/ Recognition Clear Administrative Guidelines Formal Rulings Education & Awareness Technical assistance, advice

12 Centre for Customs & Excise Studies Client Service Legal Base Assessment of Compliance Levels Enforcement/ Recognition Risk-based Procedures: Pre-arrival clearance Physical Examination Documentary Check Trader-focused audit Investigation

13 Centre for Customs & Excise Studies Client Service Legal Base Assessment of Compliance Levels Enforcement/ Recognition Reward Compliance Punish Non- Compliance

14 Centre for Customs & Excise Studies Client Service Legal Base Assessment of Compliance Levels Enforcement/ Recognition Reward Compliance Punish Non- Compliance Reduced regulatory scrutiny Periodic payment arrangements Increased self-assessment Less onerous reporting Intervention by exception

15 Centre for Customs & Excise Studies Penalty Formal Warning Persuasion Client Service Legal Base Assessment of Compliance Levels Enforcement/ Recognition Reward Compliance Punish Non- Compliance Penalty Formal Warning Persuasion

16 Centre for Customs & Excise Studies  “One size fits all” compliance strategy  Enforcement focus  Strategy dependent upon level of risk  Dual enforcement/ client service focus GatekeepersGatekeepers Risk Managers

17 Centre for Customs & Excise Studies  Indiscriminate focus or 100% check  Intervention in all areas  Transaction focus  Inflexible procedures  Focus on high-risk areas  Minimal intervention in low- risk areas  Trader focus  Administrative discretion GatekeepersGatekeepers Risk Managers

18 Centre for Customs & Excise Studies  Focus on real-time compliance assessment  Post-arrival import clearance  Physical control maintained pending revenue payment  Increased focus on post-clearance compliance assessment  Pre-arrival import clearance  Nexus broken between physical control and revenue liability GatekeepersGatekeepers Risk Managers

19 Centre for Customs & Excise Studies  Seek to identify non- compliers  No special benefits for compliers  Seek to identify both compliers and non- compliers  Rewards for compliers GatekeepersGatekeepers Risk Managers

20 Centre for Customs & Excise Studies Recognised Compliers:  “Authorised Economic Operators”  Actual benefits v. anticipated benefits (“expectation gap”)  Benefits over and above other members of the international trading community Research Activities

21 Centre for Customs & Excise Studies Supply Chain Security Initiatives:  Tangible commercial benefits  Commercial Benefits v. Regulatory Benefits  “Win-Win” or “Win-Lose” Research Activities

22 Centre for Customs & Excise Studies Supply chain security initiatives:  Tipping the balance in favour of regulatory intervention  Unreasonably high intervention practices being erroneously “blamed” on security requirements Emerging Issues

23 Centre for Customs & Excise Studies Rules of Origin:  Proliferation of FTAs  Proliferation of Rules of Origin  Reversing the trend of Harmonisation and Simplification  Retarding the international trade facilitation agenda Emerging Issues

24 Centre for Customs & Excise Studies Role of WCO and National Administrations:  Lobby for international agreements which support global trade facilitation through the ongoing harmonisation and simplification of regulatory procedures Emerging Issues

25 Centre for Customs & Excise Studies Thank You Thank You Centre for Customs & Excise Studies www.customscentre.canberra.edu.au


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