# Presentation: 103238

## Panel Discussion on

**Transportation & Customs**
**ASEAN, China, Laos, United States, Thailand**
**Sunny Chia**
**Director **
**International Trade Services**
**UPS Asia Pacific Region**

## Agenda

** ****UPS Global Customs & Trade Compliance **
**    ****-  Guiding Principles**
** ****Relevance of Supply Chains to Business **
** ****WCO SAFE Framework**
** ****APEC Trade Facilitation Action Plan II**
** ****ASEAN Single Window**
** ****Summary**

## Getting to know us - UPS

**Founded in 1907 in Seattle, Washington.**
**World’s largest package delivery company and global leader in supply chain services. **
**Headquartered in Atlanta, Georgia.**
**Service to and from more than 200 countries & territories.**
**423,300 employees worldwide (8th largest global employer).**
**Delivery fleet of 88,000 delivery vehicles.**
**World’s 9th largest airline with more than 268 aircraft.**
**2007 revenue: US$49.7B on a volume of 4 billion packages and documents.**
**We move 15.8 million packages a day; 7 percent of U.S. GDP.**

- UPS GFCO Orientation | GFCO Orientation 050803

## UPS Global Customs & Trade ComplianceGuiding Principles 

- Full compliance with all governmental laws and regulations
- Eliminate trade barriers
- Simplify border clearance regulations and procedures
- Increase low value thresholds and entry limits
- Reduction in paperwork
- Protect UPS brand and reputation
- Global consistency

**Notes:**
Now for the Guiding Principles for our UPS Global Customs & Trade Compliance Program.
We comply and will continue to comply with the laws and regulations of the countries we operate in.
We work with Border Agencies to eliminate trade barriers
We also strive to work on simplification of border clearance regulations and procedures.
Increase low value thresholds for simplified declarations to Customs
Work to reduce paperwork
And....
Protect the UPS brand and reputation for Integrity and Compliance....which are the cornerstones of our UPS culture.
And promote consistency in Customs practices so that we can make this world an easier place to do business.

## Slide 5

**Notes:**
This slide shows how much Cross Border Trade Transactions have increased...
From USD 10 Billion in a day in 1970 to the same figure for every second in 2004....in slightly over 30 years.

## Slide 6

**Notes:**
And all because of these big names, these MNCs that are seeking for economies in production and outsourcing in other countries.
Won’t it be great if some of these companies can set up their operations in the GMS ?

## Relevance of Supply Chains to Business

-    Globalisation and the Expansion of Global Trade are		irreversible.
-    Global businesses will give preference to companies with     	a very strong Supply Chain Security Program.
-    Investments in infrastructure for a healthy supply chain
-    Inefficient Supply Chains result in poor customer service    	and weaker financial results

-    *McKinsey estimates 85% of world’s GDP will be sold across int’l borders within 20 years*

- UPS GFCO Orientation | GFCO Orientation 050803

**Notes:**
We all know that we live in a Global Village.   
Globalisation is said to refer to the increased movement of goods, information, funds and people across national borders. 
We all know that Globalisation and the expansion of global trade are irreversible forces.
Historically, the competitive advantage of a company’s supply chain was vastly under-rated.  Companies competed on products and services, not processes.  Those days are over.  
Intensity of global competition is forcing companies to compete on the strength of their supply chains.   Global businesses will give preference to companies with a very strong Supply Chain Security Program.
Many of us here have invested heavily in our network, infrastructure, systems and people resources in this region  We have a huge stake in the health of our supply chain.  
This should be a concern to everyone here, both as a consumer and as a business leader and as leaders in government.   
An inefficient supply chain results in higher consumer prices, out of stock products, more inventory sitting idle in some storage place, cash that is not flowing, costly delays in getting to the market, poor customer service and weaker financial results, just to list a few.

**WCO Framework of Standards**
**to **
**Secure & Facilitate Global Trade**

## WCO SAFE Framework

***Facilitation in a Global Environment....***
-   Establish Standards that provide Supply Chain Security  and Facilitation at a global level to promote certainty and predictability.
-   Strengthen the Partnership between Customs and Trade.
-   Promote the seamless movement of goods through international trade supply chains.
-   Contribute to a Safer World.

- UPS GFCO Orientation | GFCO Orientation 050803

**Notes:**
The World Customs Organisation has derived this Framework of Standards to provide Supply Chain Security and Facilitation to promote certainty and predictability.

##  WCO Framework of Standards – 4 CORE Principles

**1)  Advance electronic information**
- Harmonise the advance electronic information requirement on inbound, outbound and transit shipments.
**2)  Risk management**
- Implementing and Conducting Risk Management for selecting high risk goods.
**3)  Outbound inspection**
- Mutual recognition of controls and authority and ability to inspect imports, exports and goods in transit
**4)  Business partnerships**
- Establishing Customs to Business partnerships and promoting the implementation of an **Authorised Economic Operator** program

**Notes:**
The Authorised Economic Operators Guidelines were approved by the WCO in June 2006.   This sets the stage for Customs Administrations to work on national programs and the mutual recognition of controls and standards through international agreements with a view of achieving green lanes and thus facilitation of trade 

## International Customs Fora

- Australia - 2007		Mexico (2002)
- Brunei (2000)		New Zealand (1999)
- Canada	(1997)		Papua New Guinea
- Chile (2004)		Peru - 2008
- China (2001)		Philippines (1996)
- Hong Kong		Russia
- Indonesia (1994)		Singapore - 2009
- Japan (1995) - 2010	Chinese Taipei
- Korea (2005)		Thailand (2003)
- Malaysia	 (1998)		USA (1993)
- 			Vietnam (2006)

***“******APEC Means Business”***

## 
	Trade Facilitation Action Plan (TFAP II)
	APEC Ministers concluded in 2006 that APEC had met the 2001 Shanghai target of a 5% reduction in trade transaction costs by 2006.   
	A new action plan known as APEC’s second Trade Facilitation Action Plan is now developed to achieve another 5% reduction in trade transaction costs by 2010.  The Plan was endorsed by APEC Trade Ministers in July 2007.

	The TFAP II includes: 
	1. Time Release Survey.
		Objective: To conduct self-evaluation of Trade Facilitation, find bottlenecks                     	in the customs related procedures and to improve them.

	2. Implement APEC Framework based on the WCO Framework of Standards
		Objective: To secure and facilitate the global trade in the APEC Region.	

**	****Trade Facilitation Action Plan (TFAP II)**
- 	APEC Ministers concluded in 2006 that APEC had met the 2001 Shanghai target of a 5% reduction in trade transaction costs by 2006.
*	**A new action plan known as APEC’s second Trade Facilitation Action Plan is now developed to ****achieve another 5% reduction in trade transaction costs by 2010.****  The Plan was endorsed by APEC Trade Ministers in July 2007.*
- 	The TFAP II includes:
- 	1. Time Release Survey.
- 		***Objective:**** To conduct self-evaluation of Trade Facilitation, find bottlenecks                     **	**in the customs related procedures and to improve them.*
*	**	*
- 	2. Implement APEC Framework based on the WCO Framework of Standards
- 		***Objective:**** To secure and facilitate the global trade in the APEC Region.**	*

**Asia Pacific Economic Conference (APEC)**

## 
	Trade Facilitation Action Plan (TFAP II)

	3. Simplification and Harmonisation on the Basis of the Kyoto Convention.    
		Objective: To improve efficiency in customs clearance and the delivery of goods 
		in order to benefit importers, exporters and manufacturers through simplified and 	harmonised customs procedures and best practices.4. Paperless and/or Automation of Trade-related Procedures.
	    Objective: To reduce paper documents for trade-related procedures and automate/ 	computerise trade-related procedures.5.  Harmonisation of Tariff Structure with the HS Convention.
	    Objective: To ensure consistency of application, certainty and a level playing field 
		for business through the HS Convention of the WCO, the standard international 
                harmonisation system the classification of goods.
	6.  Appropriate, Transparent and Predictable Trade-related Procedures.
	    Objective: To realise appropriate, transparent and predictable trade procedures through 	consistent and non-discriminatory application and implementation of trade-related laws 	and regulations.

**	****Trade Facilitation Action Plan (TFAP II)**
- 	3. Simplification and Harmonisation on the Basis of the Kyoto Convention.
- 		***Objective:**** To improve efficiency in customs clearance and the delivery of goods *
*	**	**in order to benefit importers, exporters and manufacturers through simplified and **	**harmonised customs procedures and best practices.*4. Paperless and/or Automation of Trade-related Procedures.
- 	*    ****Objective:**** To reduce paper documents for trade-related procedures and automate/ **	**computerise trade-related procedures.*5.  Harmonisation of Tariff Structure with the HS Convention.
- 	*    ****Objective:**** To ensure consistency of application, certainty and a level playing field *
*	**	**for business through the HS Convention of the WCO, the standard international *
*                **harmonisation system the classification of goods.*
- 	6.  Appropriate, Transparent and Predictable Trade-related Procedures.
- 	*    ****Objective:**** To realise appropriate, transparent and predictable trade procedures through **	**consistent and non-discriminatory application and implementation of trade-related laws **	**and regulations.*

**Asia Pacific Economic Conference (APEC)**

## International Customs Fora

- Brunei		Myanmar
- Cambodia	Philippines
- Indonesia	Singapore
- Laos		Thailand
- Malaysia	Vietnam

**Notes:**
Benefits include:
Simplify processing and procedures for trade
Reduce trade transaction costs

## Association of South East Asian Nations- ASEAN + 3

**Seoul Initiative Action Plan (SIAP)**
- Proposed by Korea Customs and endorsed at the 5th ASEM Customs DG meeting in October 2003, Korea.
- Objective: Simplification and Harmonisation of Customs Institutions and Procedures, and Customs co-operation in East Asia (encompassing 10 ASEAN member countries plus Korea, China and Japan)
- SIAP – 5 Group Categorisation
-        **I.  Customs Procedures**
- 		Time Release Study (TRS)
- 		Reduction of (Logistics) Costs relating to Transit & Transhipment goods
- 		ASEAN + 3  Website
- 		Database for customs procedures for ASEAN + 3
- 		Establishment of Single Window
- 		Common Customs documentation form
- 		Regional Authorised Trader (system)
- 		Consultation with Private Sector

**Notes:**
In ASEAN, UPS has been engaged with annual dialogues with the Customs Directors-General on macro-issues since 2001.

The ASEAN Logistics Service sector is the 12th Priority Sector to be given attention and focus to move ahead on liberalisation so as to enable the integration of ASEAN as one Economic regional grouping by 2015.

UPS is also working on a Pre-Clearance Harmonisation pilot project with 3 ASEAN member countries to enable common customs processes to ensure release of goods prior to flight arrival.

## Association of South East Asian Nations- ASEAN + 3

-     Seoul Initiative Action Plan – 5 Group Categorisation (cont’d)
- 	**II. Integrity & Transparency**
- 		Integrity, Reviews and Appeals
- 	**III. International Obligations**
- 		Revised Kyoto Convention
- 		WTO Customs Valuation Agreement
**	****IV.  Rules of Origin**
- 		Harmonisation of Rules of Origin
- 		Review of Rules of Origin
- 		Internationally Agreed Rules of Origin
- 		Verification and Certification of Origin
- 		Identification of Advantage and Disadvantage of Certificate of Origin
- 	**V.  Rules of Origin**
- 		Meeting of ASEAN + 3 Customs DG/Commissioner
- 		Capacity Building
- 		Research Task Force
- 		Use of Advanced Customs Techniques (Risk Management, IT etc.)

**Notes:**
In ASEAN, UPS has been engaged with annual dialogues with the Customs Directors-General on macro-issues since 2001.

The ASEAN Logistics Service sector is the 12th Priority Sector to be given attention and focus to move ahead on liberalisation so as to enable the integration of ASEAN as one Economic regional grouping by 2015.

UPS is also working on a Pre-Clearance Harmonisation pilot project with 3 ASEAN member countries to enable common customs processes to ensure release of goods prior to flight arrival.

## Summary

- Protecting, securing and facilitating the worldwide supply chains is a  major responsibility involving all stakeholders.
- Promote Certainty and Predictability as Disruptions have a major impact on the global economy.
- Leverage on Technology and Risk Management Techniques.
- Strengthen the Partnership between Customs and Trade.
- Simplify & Harmonize to Promote the seamless and efficient movement of goods across international trade supply chains !

## Thank You !