uTradeHub - Korea ’ s National Single Window for Paperless Trading Dr. Jae-hyun Lee Korea e-Trade Facilitation Committee Managing Director, e-Biz Bureau Korea International Trade Association

Contents 1. What is Single Window for Trade Facilitation? 2. Why Do We Need It? : Korean Case 3. Where Are We Now? : e-Trade Korea 2007 Project 4. uTradeHub: Korea’s Single Window 5. Critical Success Factors 6. Challenges Ahead

1. What Is Single Window?

Single Window Definition UN/CEFACT Recommendation 33 A facility that allows parties involved in trade and transport to lodge standardized information and documents with a single entry point to fulfill all import, export and transit-related regulatory requirements. If information is electronic, then individual data elements should only be submitted once.

Model 1: Single Authority Model 2: Single System Single Window Models

Model 3: Single Information Transaction System Single Window Models

Single Window Electronic User Korean Case Trade Chain License/ Certificate Authority Customs Service Traders Bank Global Network Logistics Company Single Window Models

Benefits of Single Window National Competitiveness Improvement One Stop Paperless Trade Service Lower business cost and greater productivity for traders Expedited trade document processing Reinforced transaction security National Competitiveness Improvement One Stop Paperless Trade Service Lower business cost and greater productivity for traders Expedited trade document processing Reinforced transaction security

Benefits Categorized Higher transparency in corporate activities Correct revenue yields Improved trader compliance Higher transparency in corporate activities Correct revenue yields Improved trader compliance Minimizing data reentry and reducing errors and inefficiencies Expedited Procedures Cutting cost Maximum usability with one-stop service Minimizing data reentry and reducing errors and inefficiencies Expedited Procedures Cutting cost Maximum usability with one-stop service On government side On private side

Global Trends of Single Window CountriesCountriesSummarySummary Hong Kong Singapore Taiwan Total trade service by TradeVan (VAS provider) covering cargo clearance, global logistics, e-Commerce and etc Efforts to integrate various services into SSO window Total trade service by TradeVan (VAS provider) covering cargo clearance, global logistics, e-Commerce and etc Efforts to integrate various services into SSO window Japan Connection Portal linking various service providers and government agencies for total and integrated trade services Proponent of global pathfinder projects (e-C/O) TradeXchange project launched in 2007 DTTN Project of Tradelink and HKSAR * DTTN : Digital Trade and Transportation Network

2. Why Do We Need It?

Korea’s Trade Volume Million USD

Bottleneck in trade process International trade in Korea Tons of trade documents 1 * CAGR: Compound Annual Growth Rate

Problems of Paper Based Trade Government  Complex regulation  Lack of transparency  Difficulty in monitoring National Competitiveness Decreased National Competitiveness Decreased  High transaction cost  Long lead time  Incorrect processing Enterprises 2  High transaction cost  Long lead time  Incorrect processing  Complex regulation  Lack of transparency  Difficulty in monitoring Enterprises Government National Competitiveness Decreased National Competitiveness Decreased

3. Where Are We Now? : e-Trade Korea 2007 Project

Development Stage of Korea’s e-Trade (1990~1999) 1st 2nd Stage 3rd (1999~2002) (2003~) Act on Promotion of e-Trade Foundation of common e-Trade Platform based on VAN / EDI L/C, E/L, I/L Offer, Insurance Export Clearance Import Clearance Manifest Tariff Refund Starting Web-based Service Certificate of Origin Letter of Guarantee Delivery Order Establishment of electronic trade platform e-Trade Document Repository Integrated and consolidated one-stop trade services ESTABLISHMENT INITIAL SERVICE SERVICE EXPANSION MOVE to INTERNET Single Window : u Trade Hub Single Window Development

Milestones in Korea’s e-Trade  In 1989, Korean government initiated - “Comprehensive Trade Automation Plan”  In 1991, Korea enacted “Trade Automation Act”  In 1991, Korea Trade Network (KTNET) was established by Korea International Trade Association (KITA)  In 1992, Korea Customs Service designated KTNET as sole customs automation service provider  In 2003, National e-Trade Committee was established (Chair :PM)  In 2004, BPR/ISP for e-Trade Process Innovation  In 2005, e-Trade Service Project, 1 st Stage  In 2006, e-Trade Service Project, 2 nd Stage

Build Internet-based national paperless trade infrastructure Innovate on existing trade services and processes Lead international cooperation to realize global wide paperless trade Reform laws and regulations to accelerate the dissemination of paperless trade throughout Korean trading and logistics communities Vision 3 Phase Plan Phase1 Building Core Infrastructure (2005) Building Core Infrastructure (2005) Phase2 Enhancing Infrastructure (2006) Enhancing Infrastructure (2006) Phase3 Upgrading User Environment (2007) Upgrading User Environment (2007) e-Trade KOREA, Innovation 2007 A leading e-Trade nation in the 21st century Vision

Organization (Korea Paperless Trade Center)  Foundation  Founded in Jan in KITA after BPR/ISP Project(Jun. 2004)  Role : Project Management Office  Implementation of 33 tasks from ‘e-Trade Korea 2007’ roadmap  Secretariat of National e-Trade Committee e-Trade Facilitation Committee Chair : Prime Minister National e-Trade Committee Platform W/G Finance W/G Logistics W/G Marketing W/G Global W/G Law W/G e-TP PM e-TDR Law Reform e-L/Ce-NegoRFIDe-L/Ge-D/Oe-MPe-CatalogSolutions e-C/Oe-B/LAPEC,ASEM Bilateral Networking Korea International Trade Association Korea International Trade Association Korea Paperless Trade Center Korea Paperless Trade Center

4. uTradeHub : Korea’s Single Window for Paperless Trading

Conceptual Model

The uTradeHub Portal Site

Categorized Service  Marketing  integrated marketing information hub  Licensing/Certification  licensing/certification procedures required for import/export  Trade Finance  e-LC Service to finance exporters  Customs Clearance  export/import related customs clearance operations via the Internet.  Logistics  Logistics services for traders, shipping lines, forwarders etc.  Payment  Paperless presentation of negotiation documents and payment

 e-Document Validation & Certification  Secure Access Control  e-Document Encryption Government Related Party Traders Electronic Document Circulation  e-Document Lifecycle Management  Metadata Registry  Form & Version  Association of e-Document Business Relationship u-Trade Document Repository Featured Architecture : uTrade Document Repository

 One stop service integrates existing paperless trading services in Korea  Reduces business cost and improves productivity  Expedites trade document processing  Offers smart service based on BPM (business process management) uTradeHub: Benefits

5. uTradeHub : Success Factors

Critical Success Factors  Strong leadership by government  Budget  IT infrastructure (Network, Hardware, Software)  System Integration experience  Legal framework readiness  e-Readiness of Industry  Adopting International standards and trends

Strong Leadership and PPP Strong Leadership by Government A Typical Government – Bank Leaders meeting

Broadband Network 서울 2 서울 1 부산 광주 대구 대전 House- holds Penetration : 80%(2005) - Available to over 97% of population Schools All Primary & Secondary Schools Connected to Broadband (Sept. 2000) Korea’s Broadband Penetration IT Infrastructure of Korea No. of broadband subscribing households: 11.8 million (77%) ※ subscriber/100 persons KoreaNetherlandsCanadaJapan U.S 위1위 2위2위 No. 1 in Broadband Internet Penetration Rate (Source: OECD, 2005)

Legal Infrastructure Digital Signature Act Trade Transactions Facilitation Act Customs Law e-Trade Facilitation Act Foreign Trade Act Electronic Transactions Act In 1991, Enacted ‘Trade Automation Act’ In 2004, Revised the Act to ‘e-Trade Facilitation Act’

6. Challenges Ahead

Connectivity to the global trade  Encouraging Industry Awareness and Adoption  Establishing International Standard  ebXML  the UN Trade Data Elements Directory (UNTDED)  UN EDIFACT  WCO Data Model etc  Connection among National Single Windows  Mutual Authentication and systemic connectivity

Korea’s Initiatives as an e-Trade Leader  e-Certificate of Origin Pathfinder Project - Korea-Chinese Taipei  e-Bill of Lading Project - Connecting national SWs for title documents - APEC Initiative by Korea - Singapore’s TradeXchange as a project partner  e-Negotiation Project -Pilot project with China -Presenting negotiation documents in electronic formats and complete electronic payment

Thank you ! (Q&A)