This document was produced for review by the United States Agency for International Development. It was prepared by SEGURA Consult ing 
for the Trade and Competitiveness Activity, contract number AID-OAA -C-17-00110. Its contents are the sole responsibility of the  author and 
do not necessarily reflect the views of USAID or the U.S. Government.  THE TRADE FACILITATION AGREEMENT: 
A WORLD OF OPPORTUNITIES FOR MSMEs USAID 
RD/DEV/191 
   3ACKNOWLEDGEMENTS  
This report was written by Tania D’Allonnes, an independent consultant, with support from SEGURA 
Consulting.  
This publication was developed with guidance from the U.S. Agency for International  Development 
(USAID) Bureau for Development, Democracy, and Innovation (DDI). The author  expresses gratitude 
to Paul Fekete of the Center for Ec onomics and Market Development (EMD) for offering thoughtful 
comments and suggestions through several cycles of editing.   
The author further thanks Christina Kopitopoulos of the Office of the United States Trade  
Representative (USTR) for closely reviewing  the report and ensuring it is comprehensive,  accurate, and 
consistent with the text of the Trade Facilitation Agreement . 
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   4CONTENTS  
ACRONYMS AND ABBREVIATIONS  ........................................................................................................ ii	
FOREWARD .................................................................................................................................................. iv	
EXECUTIVE SUMMARY  ...............................................................................................................................  1	
Trade Facilitation for Smaller Businesses:  A Literature Review  .............................................................  3	
HOW  TRADE  FACILITATION  SUPPORTS  INCREASED  TRADE  ..................................................................................... 3 	
SME  INTERNATIONALIZATION  .............................................................................................................................................. 4 	
THE  “DEVEL OPMENT  DIMENSION”  ....................................................................................................................................... 5 	
Making the TFA Work for MSMEs  ...............................................................................................................  8	
INFORMATION  ON RULES  AND  PROCEDURES  ................................................................................................................ 8 	
RELEASE  AND  CLEARANCE  OF GOODS  ........................................................................................................................... 10 	
FEES  AND  PENALTIES  ................................................................................................................................................................ 13 	
CONSULTATIONS  AND  APPEALS  ........................................................................................................................................ 14 	
HARMONIZATION  ACROSS  BORDERS ............................................................................................................................. 16 	
E-SYSTEM S ..................................................................................................................................................................................... 19 	
MAINSTREAMING  TRADE  FACILITATION  ........................................................................................................................ 22 	
WHAT  THE  TFA  DOES  NOT  DO .......................................................................................................................................... 25 	
The Trade Facilitation Agreement: A Brief Overview  ............................................................................ 27 	
WHAT  IS TRADE  FACILITATION?  ........................................................................................................................................ 27 	
A SHORT  HISTORY  OF THE  TFA ........................................................................................................................................... 29 	
OVERVIEW  OF THE  TFA ........................................................................................................................................................... 30 	
GLOSSARY ...................................................................................................................................................  32 	
BIBLIOGRAPHY  .......................................................................................................................................... 35 	
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   5USAID.GOV THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      |     ii ACRONYMS AND ABBREVIATIONS 
AEO/AO  Authorized Economic Operator/Authorized Operator  
ASEAN   Association of Southeast Asian Nations  
B2B Business -to-business 
BCP  Border crossing point  
BDS  Business development services  
CEFTA  Central European Free Trade Agreement  
EC/EU  European Community/European Union  
FDI Foreign direct investment  
GDP  Gross domestic product  
GVC  Global value chain  
ICT Information and communications technology  
IT Information technology  
ITC International Trade Cent re 
LDC  Least develope d country 
MSME   Micro, Small and Medium -sized Enterprises  
NTFC  National Trade Facilitation Committee  
NTM  Non-tariff measures  
OECD  Organization for Economic Co operation and Development 
PSI Pre-shipment inspection 
R&D  Research and development  
SDG  Sustainable Development Goal  
SME  Small and Medium -sized Enterprises  
TFA  Trade Facilitation Agreement  
TFI Trade Facilitation Indicator 
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   6iii     |      THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      USAID.GOV UNCTAD  United Nations Conference on Trade and Development  
UNECE   United Nations Economic Commission for Europe 
URL Uniform Resource Locator  
WCO  World Customs Organization  
WTO World Trade Organization  
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   7USAID.GOV THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      |     iv FOREWARD  
While Micro, Small and Medium -sized Enterprises ( MSMEs) are widely acknowledged to contribute to 
the economic growth of a country, their parti cipation in international trade has been constrained 
because they typically lack the skills, knowledge of international markets , and familiarity with border 
procedures to effectively engage in the global economy.   
The World Trade Organization ’s (WTO) Trade  Facilitation Agreement  (TFA) includes many provisions 
that address some of these challenges both by providing greater levels of transparency regarding the 
rules and regulations of trade and by reducing the time and cost to trade, thereby improving the 
competitiveness of all firms.  
Since its entry into force in 2017, implementation  of the TFA has been progressing, but many countries, 
particularly developing ones, continue to face challenges with implementation of the reforms and 
modernizati on of customs and border agency procedures called for within the agreement.   
USAID’s publication of The Trade Facilitation Agreement: A World of Opportunities for MSME s is intended to 
raise awareness among policymakers, the private sector, and other stake holders about the importance 
of the TFA to the MSME community.  Hopefully this publication can contribute additional knowledge to 
the national dialogues taking place about the TFA’s implementation and to encourage stakeholders to 
recognize the value of the  TFA’s implementation in a timely and comprehensive fashion. 
With greater understanding of the beneficial impacts  of the agreement to the business community and 
an appreciation for its related effects might come additional impetus to achieve the full objec tives of the 
agreement.  But implementation of the agreement is only a means to an end: the unleashing of the 
private sector— including MSMEs— to expand  their ability to engage in international trade, and thereby 
contribute to national economic growth and prosperity. 
Paul Fekete  
Senior International Trade Advisor USAID | Bureau for Development, Democracy, and Innovation (DDI)  
February 2021  
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   81     |     THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      USAID.GOV EXECUTIVE SUMMARY 
The Trade Facilitation Agreement (TFA) aims to make it easier for traders of all WTO M embers to 
participate in international trade. Not only are trade costs significantly higher in low -income countries, 
they are falling at a slower pace. This reflects a vicious circle, whereby limitations in human and financial 
resources make it more difficult to develop sophisticated production and trade, which in turn limits 
resources.  
The prevalence of micro, small and medium -sized enterprises (MSMEs) in ter ms of both numbers and 
employment, especially in developing and least developed countries, is widely recognized. Compared 
with larger firms, MSMEs tend to incur higher costs and spend more time in obtaining market, 
regulatory, and other information. Their smaller size makes these businesses more vulnerable to 
inefficient systems, making trade facilitation measures especially beneficial to their development. There is 
growing consensus on the specific trade facilitation measures most helpful to MSMEs, namely the “soft” 
measures  that reduce documentation requirements, lower guarantees, and streamline declarations and 
procedures. T ransparency measures help make trade more predictable and  investing in them  is key to 
expanding trade benefits for MSMEs.  
Growth in d igitalization has markedly transformed production and trade. Global Value Chains (GVCs) 
break up the production cycle across countries  and account for an astounding 80 percent of trade. 
GVCs are seen as access points into international trade for MSMEs beca use individual firms can 
concentrate on their core production activity and develop knowledge and capacity through the GVC. 
But GVCs operate in regional hubs with global production centered in China, Germany, and the United 
States. This means potential springboards for MSMEs joining international trade exist primarily at the 
regional level, including through joint trade facilitation efforts. With proper trade facilitation, e-
commerce is another potential avenue for MSME internationalization .   
Along these lines, many of the provisions in the TFA have the potential to benefit MSMEs by lowering 
the time and cost of doing business , through:  
-Information on rules and procedures : The TFA treats the provision of c lear, reliable
information as foundational to allow businesses to plan better and increase compliance with t he
tra
ding system.
-Release and clearance of goods : By improving cross -border processing for Customs and
ot
her border agencies, the TFA aims to make trade faster and more stable, removing inefficiencie s
th
at plague small businesses.
-Fees and penalties : TFA provisions on fees and charges seek to discipline  the strictly financial
aspects of clearing goods, especially on smaller shipments, where payments can be prohibitive f or
MS
MEs.
-Consultations and appeals:  The TFA recognizes the importance of participation by the private
sector, including MSMEs, as well as other stakeholders (consumer groups, civil society ), to help
dr
aft rules and procedures and respond to disputes, thus increasing certainty and lowering ris k
and 
corruption.
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   9USAID.GOV THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      |     2 -Harmonization across borders:  The TFA includes a set of specific recommendations for
fa
cilitating the movement of goods at the border, including best practices for coordination among
national trade -related agencies and with foreign counterparts.
-E-Systems : The TFA goes beyond correcting inefficiencies in documents and processes t o
est
ablish a new, digital system of trade to replace paper -based systems.
But beyond these provisions, the TFA has much broader aims: it aspires to mainstream trade facilitation. 
Trade has linkages to almost all sectors of an economy. Mainstreaming trade facil itation acknowledges 
trade as an engine for growth and poverty reduction, contributes to an improved business environment, 
and thereby increases opportunities for MSMEs.  
While the TFA’s primary beneficiaries are traders, it also has collateral benefits. T hese include business 
formalization, improved accountability, legal reform, modernization, and sustainable development. It has 
been suggested that the TFA will have a greater impact on reducing trade costs than eliminating all 
remaining tariffs. Perhaps more importantly, proper TFA implementation will improve the experience of 
society as a whole: more openness and transparency are powerful engines of growth and development.  
The paper closes with an overview of trade facilitation and the Trade Facilitation A greement. A glossary 
of technical terms and a list of resources follow.  
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   103     |     THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s                                  USAID.GOV  
 
 
 TRADE FACILITATION FOR SMALLER BUSINESSES:  
A LITERATURE REVIEW  
According to the 2019 Doing Business Report, it takes less than a day to export and 16 hours to import 
goods within the Central European Free Trade Agreement (CEFTA) region. This is more efficient than 
the average for Europe and Central Asia, where it takes about two days in either direction. But it is much less efficient than the average for Organization for Economic Co -operation and Development 
(OECD) countries: 15 hours to export and only 12 hours to import. The average Customs transaction 
involves 20 to 30 different parties and 40 documents (as well as multiple repeated agency tasks). These 
observations illustrate the potential benefits to be gained from TFA implementation for both users and 
providers of the services. Indeed, academic research has produced impressive numbers for the average 
decline in trade costs expected from full implementation, finding th at trade costs can equate to over 100 
percent ad valorem tariff in high -income countries and over 200 percent for developing countries.
1 
Not only are trade costs significantly higher in low -income countries than in wealthier ones, they are 
also falling mo re slowly. This is in part due to limitations in human and financial resources (moving goods 
quickly takes skilled agents and some investment in facilities and tools) and in part due to natural 
obstacles to trade (such as physical remoteness , which hinders  many least developed countries (LDCs)). 
The narrow economic structures of production and trade also inhibit developing countries and LDCs. 
These countries produce and sell fewer goods because it is difficult to import inputs and export 
products, making it expensive to develop new and more sophisticated production lines (a vicious circle).  
Although there is limited hard data on micro, small and medium- sized enterprises (MSMEs) , especially in 
developing countries and LDCs, their prevalence is acknowledged in  those economies in terms of both 
numbers and employment: there are few large enterprises and small or very small enterprises account 
for most jobs. Definitions of MSMEs differ and are open to some interpretation. Typically, these are 
formal enterprises, w ith a small number of employees and limited revenues. Businesses employing 10 or 
fewer workers are generally considered micro -enterprises, while SMEs are those employing fewer than 
250.2 In sub-Saharan Africa for example, most intra -regional trade of food and consumer goods is done 
by MSMEs. It is accepted that their smaller size makes these businesses more vulnerable to inefficient 
systems so that trade facilitation would be especially beneficial to MSMEs. While evidence suggests trade 
facilitation mi ght help firms of all sizes— though gains may be unevenly distributed —there is growing 
consensus on the specific measures that are most helpful to MSMEs, namely the “soft” measures that 
reduce the fixed costs of entry . These include reduced documentation an d data requirements, lower 
guarantees and thresholds, and streamlined declarations and procedures .3 
HOW TRADE FACILITATION SUPPORTS INCREASED TRADE  
Facilitating trade should, almost by definition, increase  trade volumes: easier flow means a better ability 
to meet demand, so more movement. It also allows for diversification: smoother processes make it 
possible to explore new products and markets. There is evidence that the gains from trade facilitation 
affect  different -sized firms differently, increasing  or diversifying in uneven measure.  
TFA measures encompass both fixed and variable costs. The procedures that apply to each shipment 
may be considered variable; but learning what form to present and how to fill  it out may be considered a 
 
1 ASEAN trade costs stand at 76% tariff equivalent after decades of trade integration.  
2 http://documents.worldbank.org/curated/en/967301468339577330/pdf/WPS5538.pdf  
3 http://www.cutsgeneva.org/pdf/BP -2014- 1-Trade%20Facilitation%20SMEs%20and%20Consumers.pdf . 
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   11USAID.GOV  THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      |     4 fixed cost— because it is only incurred once. In that the TFA promotes access to information and 
simplified documents and formalities, it can increase trade flows.  
In easing access to information and procedures, the TFA can also  encourage export diversification in 
two forms: more and/or different products are exported, or products are exported to more 
destinations (trade is broader). Research finds that with trade facilitation, more products reach more 
markets. MSMEs may be parti cularly responsive  to these gains as they may be come more comfortable 
exploring new ventures as transparency grows, and so would look at producing new items or entering new markets.  
SME INTERNATIONALIZATION  
Growth in digitalization ha s transformed producti on and trade. The much -increased availability of 
management software has revolutionized manufacturing, while social networks and their advertising potential have created a marketplace that is truly global.  
Global Value Chains (GVCs) break up the production  cycle across countries, exploiting low 
inventory and quick product turnaround, and moving intermediate inputs across locations. GVCs account for an astounding 80 percent of trade. These GVCs are seen by some as access points into international trade for MSMEs.
4  Because each firm is responsible for one discrete step  while the GVC 
hub absorbs fixed costs ( for research and development, logistics, etc.), individual firms can concentrate 
on their core production activity and develop specialized knowledge and capacity. GVCs ship unfinished 
products across multiple borders, so trade facilitation lowers their costs and can enhance demand, 
production, and investment along the entire value chain. The proliferation of GVCs reinforces economic interdependency and a cross- border shared interest in trade facilitation. 
Interestingly, GVCs tend not to be so much global as regional, as pictured in Figure 1 below. Broadly 
speaking, there are three main centers of global production: China, Germany, and the United States; 
China is the hub for Asian GVCs, while Germany coordinates Europe and Africa. The United States’ 
GVCs are principally through Mexico and Canada. This means potential springboards for MSMEs joining international trade exist primarily at the regional level, including through joint trade facilitation efforts. However, internationalizing through GVCs implies several caveats. Often, developing countries and LDCs participate in GVCs but their own value -added is small: the balance of power between the 
process-owner and its suppliers is skewed and if MSMEs are to grow and become independent, political 
choices need to be made (again preferably at the regional level) with in appropriate environmental, social, 
and governance frameworks.
5 
4 OECD research suggests that the use of foreign value added is one of the most important factors in the growth of domestic 
value added in exports across all activities for developed and emerging economies alike .
5 South- South GVCs emphasize price over qual ity, making growing South -South trade accessible to MSMEs.  
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   125     |     THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      USAID.GOV FIGURE 1. VALUE CHAINS ARE REGIONAL: HUB AND SPOKES  
Source: I nternational Trade Centre (ITC),  2017 
E-commerce is another avenue for MSME internationalization. In theory, even MSMEs can establish a
virtual global storefront by setting up a website. The far -reaching development of sal es platforms has
ma
de the client/seller interface much more direct and greatly improved producers’ ability to reach their
target customers in multiple markets. If trade facilitation reduces delays and uncertainty in delivery – and
speci
al dispositions are made in the TFA to facilitate courier shipments in particular – then MSMEs ma y
be 
able to increase their exposure and sales to international clients: no middlemen to distort dem and
and 
no delays to cause disappointment and lost sales. Again, caution is mer ited in dealing with e -
commerce platforms, lest the balance of power tilt away from MSMEs. Moreover, connectivity, still  a
si
gnificant issue in remote areas, remains a not -insignificant obstacle to MSME internationalization
through e -commerce channels .
THE “DEVELOPMENT DIMENSION”  
“SMEs are the inclusive growth vehicles of the future and the world's largest 
potential source of new jobs.”   
–Arancha Gonzalez, former Executive Director, ITC
The TFA focuses on making trade flow more smoothly. It does so by a combination of information -
sharing, process streamlining, cutting red tape, and various best-practice approaches. While the TFA’s 
primary beneficiar ies are  traders, it also has collateral benefits. Among these are formalization, 
accountability, legal reform , modernization, and contribution to some sustainable development goals 
(SDGs), as presented below.  
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   13USAID.GOV THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      |     6 FORMALIZATION  
The TFA place s significant emphasis on making processes and procedures more transparent  and 
efficient. It also argues for simplification, for instance by reducing requirements for documentation. 
Making the rules of the game clearer and more predictable encourages compliance, eliminating the need 
to cheat and the basis for illegal practices such as unofficial payments. A simpler system is cheaper  to 
use, which encourages people to follow the rules and brings users into the formal sector. Working in the formal sector brings certain protections such as legal recourse and reduces foregone revenues for the government, in turn reducing the need for ext ra revenue collections from business es. This is 
particularly relevant for MSMEs, which have limited  resources and may therefore resort to unofficial 
channels to “make life easier.” By making compliance easier, trade facilitation contributes to 
formalizatio n of the economy.  
ACCOUNTABILITY  
The TFA contains several measures that will make Customs and other border agencies more 
accountable. Customs decisions to hold up clearance or impose a penalty, for example, must be explained in writing. Appeals processes should also exist when adverse decisions are taken by border 
agencies, and these agencies are encouraged to introduce regular measurements of their performance. 
These measures make Customs operations more visible and transparent, which in turn ma kes operators 
more accountable for their actions and decisions. The removal of “black boxes” around the movement of goods gives the public, starting with the private sector , the tools to monitor its service providers. It 
also removes uncertainty from the system, making it more predictable and stable, whatever the size of the service user. MSMEs, like larger firms, will have greater awareness of what constitutes proper 
service from border agencies, be able to expect accountability from these agencies, and have access to 
due recourse when services fall short.  
LEGAL REFORM  
Implementation of the TFA leads to a more structured ecosystem with spillover benefits for various 
legal an d regulatory mechanisms.  These include formalization of public -private dialogue and related 
feedback mechanisms and the codification of rules, procedures, processes, and requirements for international trade transactions. Further, the TFA’s push for stream lining the processes around trade 
provides motivation, examples, and momentum for change. Customs often has a prominent role in developing and least developed countries, having both financial means and clout. Improving its administration will naturally lead to some reengineering: to “do” trade facilitation properly, every step and document must be analyzed and assessed for its contribution (or lack thereof ). Implementing the 
TFA therefore serves in promoting legal reform; and if a Customs agency reforms, partner agencies will 
have both the incentive and the pressure to follow suit. They may even receive technical and financial assistance to do so in support of general system reform, as donors highlight the importance of a holistic 
approach to trade facilitat ion. 
MODERNIZATION 
Moving small economic a ctors into the formal sector, making interactions with government more 
transparent, introducing accountability of officials and services, and promoting administrative and legal 
reforms are all steps to modernizing an economy and society more broadly. These steps recognize the 
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   147     |     THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s                                  USAID.GOV  
 
 
 roles and responsibilities of all the actors in the system, whether private or public, and the influence 
they can and should have over how the community lives. In this context, trade facilitati on can assist in 
the protection of the public interest on several fronts: by reducing lost revenues from inefficiencies and 
corruption, but also by helping to improv e public health through coordinated efforts against counterfeit 
trade and unsafe products. By making the business environment more transparent, trade facilitation also 
removes the incentives for illegal and at times dangerous practices, improving safety and security for all. Trade facilitation boosts domestic competition , leading to more efficient  resource allocation. And the 
formalization and codification of the enabling environment as encouraged by the TFA is also a draw for 
foreign direct  investment. Companies tend to expand to countries where they will not have to pay 
bribes or encounter othe r explicit, market -distorting measures. There is a strong linkage between a 
transparent regulatory environment and the interest of U.S. and other multinational investors. These 
investments, with their attendant technology transfers, represent valuable oppo rtunities for SMEs to join 
GVCs.  
THE TFA AND SDG S 
Several specific measures of the TFA, and its general intent more broadly, support the Sustainable Development Goals adopted by the United Nations in 2015.  
 
  
 
 
 
A general example of the TFA’s link to the SDGs is its push, through administrative reform, to formalize 
and integrate economies: better information and less room for illegal practices can significantly 
encourage MSMEs to move their activities into the formal sector and connect with international players. 
This contributes to SDG 8 “Decent work and economic growth .”  
A specific example is Article 6 of the TFA, discussed below, on removing the opportunities for 
corruption around Customs collections: this feeds directly into SDG 16 “Peace, justice and strong institutions,” also supported by TFA articles requiring increas ed information and consultations. Properly 
implemented, almost all provisions of the TFA can make a positive contribution to these and other SDGs, not least 10 “Reduced inequalities,” 9 “Industry, innovation and infrastructure,” 4 “Quality education,” and 5 “Gender equality.” Improvements in these areas in turn support equitable economic 
growth and development worldwide. The 2030 Agenda for Sustainable Development, ad opted by all United Nations Member States, 
provides a shared blueprint for peace and prosperity for people and the planet, now and into the 
future. At its heart are the 17 Sustainable Development Goals (SDGs), which are an urgent call for 
action by all countries —developed and developing —in a global partnership. They recognize that 
ending poverty and other deprivations must go hand -in-hand with strategies that improve health 
and education, reduce inequality, and spur economic growth – all while tackling clim ate change and 
working to preserve our oceans and forests.  
https://sustainabledevelopment.un.org   
 
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   15USAID.GOV THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      |     8 MAKING THE TFA WORK FOR  MSME S 
“In most developing countries, SMEs make up the biggest share of GDP but are 
also the biggest employe r, so there is the social impact to consider. Many SMEs 
and traders do not use formal channels, which reduces income for the state. In 
reality, most SMEs trade regionally and intra -regionally and also produce 
intermediate goods .”   
–David Vivas Eugui, Senior Advisor, CUTS Internationa l
MSMEs represent 95 percent of global enterprises and at least two -thirds of all private sector 
employment. MSMEs tend to incur higher costs and spend more time in getting market, regulatory , and 
other commercial information  compared to larger firms which often have resources dedicated to trade -
related tasks. MSMEs often have only one or two people on the management side which does not give 
much time for exploring potential new ventures and scrutinizing legislation, especially for far- flung places, 
as opposed to larger firms that might have entire marketing and legal departments for such research. Investing in making trade predictable, accountable, and cooperative is the key to expanding trade 
benefits for MSMEs: simplifying and making information more accessible reduces costs. 
The TFA increas es predictability for traders through a number of its articles, including Articles 1 
(Publication and availability of information), 2 (Opportunity to Comment...), 3 (Advance rulings), 5 
(Other measures to enhance impartiality, non -discrimination and transparency), 6 (Disciplines on fees 
and charges), 7 (Release and clearance of goods) , and 10 (Formalities connected with importation and 
exportation and transit).  
INFORMATION ON RULES AND PROCEDURES 
Like all businesses, MSMEs do better with more transparency. The expectation of clear and reliable information and processes makes for cheaper and more efficient planning and execution. Conversely, systems which are opaque or overly complex make compliance  
more onerous and open the door to discretion and the temptation to ease processing through corruption. The TFA recognizes that the first step to a clear and stable environment is through proper information. Providing both government officials and the business community with transparent rules encourages 
compliance, boosts efficiency, and st reamlin es Customs receipts. 
Article 1 of the TFA covers the issue of access to information in some detail, as follows :
6 
Art. 1- 1 Publication  - Members shall publish in a non-discriminatory and easily accessible manner 
information on procedures; documents; quotas, duties, taxes, fees, charges and penalties; rules on 
6 Text in red throughout this section offers brief summaries of the salient parts of TFA provisions described. The convention 
Art. X -X refers to first the Article number and then the subsection num ber within that Article. The convention Art. X.X  
refers to the Article number and then the paragraph within that section. For full English text of the provisions, please see 
https://www.wto.org/english/docs_e/legal_e/tfa -nov14_e.htm.  
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 classification, valuation and origin; trading agreements; restrictions and prohibitions; and procedures for 
appeal or review.  
This requirement means firms will spend less time looking for the exporting and importing requirements 
of both local and overseas markets. Information must be available to all businesses, domestic and foreign 
alike. In addition to saving time on research, this will enable the estimation of import and export costs, 
which are key to developing budgets and to negotiating price and delivery conditions.  
MSMEs will also save time and money on actual transactions by avoiding delays, fees , or penalties, which 
result from being poorly prepared for clearing imports or exports. By knowing which documents to 
prepare and present, and which fees to pay in advance of moving goods, businesses minimize 
opportunities for errors and discretionary pressure.  
Art. 1-2 Information Available Through Internet  – Members shall make available through the 
internet, preferably also in English, French or Spanish, a description of import, export , and transit 
procedures (including appeal), the forms and documents required, and contacts of enquiry point(s).  
This requirement provides  for online  access to required forms and documents in addition to accurate, 
relevant information. It removes the need for physical presence by providing the information and forms 
electronically  and reduces the costs for translation or legal services to access informat ion about a target 
export market. As a result, MSMEs should gain a better understanding of the regulatory requirements of 
their operating environments and save on ancillary costs to enter new markets.  
Art. 1 -3 Enquiry points  – Members shall maintain one or  more 
enquiry points to answer reasonable queries and provide required 
forms and documents. Any charge should be limited to the cost of 
the services rendered.  
This requirement facilitates MSMEs’ access to reliable information, since “raw” legal documents c an be 
both difficult to find and  challenging  to understand. Having a qualified person to answer questions and 
provide relevant documents, at no or limited cost, will save time and money in getting clear and 
definitive answers both in the home and target countries. In addition to saving time and effort, this 
provision may well open new opportunities for MSMEs.  Many countries have launched trade portals, as 
shown by the table below: 
TABLE 1. ILLUSTRATIVE LIST OF T FA ENQUIRY POINTS  
COUNTRY  LINK TO ONLINE ENQUIRY POINT  
Albania  http://www.dogana.gov.al  
Brazil http://www.comexresponde.gov.br  
Côte d'Ivoire  http://www.pwic.gouv.ci  
Georgia info@rs.ge  
Indonesia  http://www.kemendag.go.id  
Kazakhstan  http://kgd.gov.kz  
Lao PDR  http:// www.laotradeportal.gov.la   
Mongolia  http://www.customs.gov.mn/en  
Lao PDR launched its trade 
portal in 2009:  
www.laotradeportal.gov.la  
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   17USAID.GOV THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      |     10 Philippines  boc.cares@customs.gov.ph  
Turkey  http://vatandas.gtb.gov.tr 
Ukraine  ep@me.gov.ua  
Vietnam  http://www.vietnamtradeportal.gov.vn  
Source: World Trade Organization. Trade Facilitation Agreement Database. Accessed February 10, 2021 . 
Art. 1- 4 Notification – Members shall notify the WTO of the above provisions. 
This requirement mandates Members to inform the WTO of the establishment of the provisions on 
publication and enquiry points; the WTO in turn publishes their locations on its website. A single, 
centralized list  of URLs of relevant online information and physical addresses of enquiry points at 
https://tfadatabase.org/information -for-traders/enquiry -points, along with links to relevant provisions, 
makes for easier and cheaper access for MSMEs.  
Art. 3 Advance Rulings  - Members shall issue binding advance rulings on tariff classification or origin in 
a reasonable, time- bound manner. Members are encouraged to extend advance rulings, in particular to 
valuation.  
This require s WTO members  – upon request – to determine the classification and origin before goods 
move, so both costs and margins can be known in advance. Once issued, advance rulings are binding at all ports of entry, removing disputes and discretion regardless of the route the shipment takes. With  
advance rulings, all determinations are made so clearance is sped up: resulting in less warehousing, demurrage, and shorter delivery times. Further, advance rulings are typically valid for a window of time, 
which allows for several rounds of imports or ex ports at a known cost.  
Some countries publish advance rulings (stripped of confidential information) so other traders will know 
how similar goods may be treated, which again lowers information costs. The use of advance rulings is not mandatory but can help  remov e uncertainty and assure consistent treatment at different border 
crossings. In this way, advance rulings can be an invaluable cost -saving instrument for MSMEs, provided 
the volume, value, or frequency of shipments justify making the request to Custo ms. 
RELEASE AND CLEARANCE OF GOODS  
Release and clearance of goods is perhaps the most visible aspect of moving goods across borders. Businesses, especially smaller ones, routinely complain of the inefficiency of “Customs” in moving goods, costing them time  and money. It should be recognized that Customs is not the only border agency, but 
as the face of goods  clearance, work on Customs procedures is fundamental in at least two ways: (i) 
with better Customs operations comes less friction; and (ii) more effici ent Customs means more time 
for other interventions. The TFA aims to improve the border -crossing process through Articles 7 
(Release and Clearance of Goods) and 10 (Formalities Connected with Importation and Exportation and 
Transit).  
Art. 7- 1 Pre-arrival Processing - Members shall allow for the submission of import documentation 
and other required information, in order to begin processing prior to the arrival of goods with a view to 
expediting release. 
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 This measure allows goods to move more quickly, as prel iminary document checks may be done in 
advance of the arrival of the shipment. MSMEs would benefit  from getting documents reviewed before 
shipments arrive, with particular time savings where processes are not automated (that is, where they 
are still paper -based,  which requires additional  time). Goods moving more quickly reduces delays and 
handling costs, especially if import declarations are processed pre- arrival (no demurrage, refrigeration, 
etc.). Additional benefits flow from the possibility of immediate  cargo release or the ability to submit all 
documents electronically.  
Art. 7 -3 Separation of Release from Final Determination of Customs Duties, Taxes, Fees 
and Charges  - Members shall allow the release of goods prior to the final determination of customs 
duties, taxes, fees, and charges. The Article also includes rules on Customs’ use of guarantees.  
Separation of release from the payment of taxes will ensure goods move more quickly, without stopping to determine the final duties  and taxes  owed to  Customs. This significantly reduces entry point costs 
(demurrage, storage, refrigeration, spoilage, etc.) and time (cargo is released more quickly and queues 
shortened) and should make for shorter or more predictable delivery times.  
Further, any guarantee is limite d to the duties and taxes payable, possibly with a provision for a fine, and 
must be discharged by Customs as soon as the transaction is finalized . Securing  such a guarantee 
through surety companies should not be cost -prohibitive even for MSMEs , which can be cash- poor and 
therefore find it difficult to tie up funds for any extended duration.  
Art. 7 -8 Expedited Shipment  - Members shall allow expedited release of at least those goods entered 
through air cargo facilities.  
Though not exclusively, this article provides further trade facilitation for express couriers. Their 
customers, including MSMEs who import or export goods on a just -in-time basis, will enjoy faster 
customs processing and quicker delivery. The waiving of small amounts of duty and tax (de minimis 
rules) would be an additional savings of both money and time. As discussed in the context of e -
commerce, this provision might facilitate “internationalization” of MSMEs by making it  faster and cheaper 
to reach customers around the world via popular electronic sales platforms.  
Art. 7 -7 Trade Facilitation Measures for Authorized  Operators  - Members shall provide 
additional trade facilitation measures to (authorized economic) operators who meet specified criteria.  
Authorized Operators (AO) typically submit fewer documents, have 
fewer cargo inspections, enjoy rapid release, can defer payments, and may clear goods at their own premises.  Fewer checks and 
simplified procedures save time and costs at border crossings. The possibility of deferring payment (and, to a lesser degree, 
comprehensive guarantees where one payment covers several transactions) is of significant value to 
MSMEs as it l ends cashflow fluidity.  
Additional benefits derive from AO status being recognized by foreign Customs authorities through 
mutual recognition agreements, which would further ease cross -border movements. Customs 
administrations typically cooperate across bo rders and recognize each other’s seals of approval, so a 
known trader for one Customs administration may also enjoy similar recognition with another counterpart. Additional benefits may accrue from being granted AO status by Customs, since it is in 
essence certification as a trusted business, which may serve in marketing or B2B opportunities to which 
producers and consumers are increasingly attentive in their purchasing decisions.  Although most AO 
Brazil’s AEO program is 
designed to attract MSMEs  
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   19USAID.GOV THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      |     12 programs are not designed for MSME participants,  article 7.7 .2(b) of the TFA requires that AO 
programs should be implemented in a manner that does not disincentivize the participation of MSMEs.  
Art. 10-2 Acceptance of Copies  - Members shall endeavor to accept paper or electronic copies of 
supporting documents.  
This requirement will yield significant savings in time and its attendant costs: goods will not wait for 
hand- delivery of original paper documents, or for one document to do the rounds of all border 
agencies, or for documents that may be difficult to obtain, such as export declarations. If only originals 
are accepted, there are limitations on pre -arrival processing, or for changes in delivery. There are also 
concerns over loss or falsification. Accepting copies can save much back -and-forth, which equates to 
time and money. Moving to electronic copies further secures and speeds up the system and is a step 
towards automation of the entire customs clearing process.  
Art. 10-6 Use of Customs Brokers  - Members shall not introduce the mandatory use of customs 
brokers.  
This provision represents savings in two circumstances:  
1)Where Customs requires the use of customs brokers, the system must be transparent,
providing clarity and some control for businesses over the cost of using brokers.
2)Where there is no mandatory use of customs brokers, the cost of these services is eliminated
for businesses that choose to make their own declarations, and business has more contro l
ov
er customs clearance should it wish to act on its own.
In addition to the above -reviewed provisions, which will result in direct time and cost savings to 
business, the TFA includes several prescriptions for internal improvements of Customs and border 
agency operations. These measures, while they may not directly impact businesses’ cashflows, wi ll ease 
cross-border processes  and thus improve the operating environment generally. Properly implemented, 
they may yield significant progress toward the international ization  of MSMEs. These more administrative 
steps include:  
Art. 7- 4 Risk M anagement  - Members shall maintain a non -discriminatory risk management system for 
customs control.  
Modern trade is too voluminous and varied to allow or justify inspections of 100 percent of all shipments. Attempts to do so are both impossible (because of  the magnitude and complexity of goods) 
and inefficient (with necessarily finite human, technical, and financial resources). Customs and other border agencies are encouraged to adopt best -practice approaches to risk management, whereby 
shipments to be insp ected are selected on “appropriate selectivity” criteria, including the nature or 
origin of the goods, with some proportion of random selection. Risk management is in principle and in effect a philosophical change to the entire system for dealing with trade, assuming most is legitimate and 
focusing on selected outliers, such as weapons, drugs, or dangerous products. With reduced inspections 
and the possibility of green channels or trusted traded programs, clearance times will shrink overall. In this context, processing speeds up, saving time and money for traders. Further, with the increasing importance of e- commerce and the resulting movement away from bulk container shipments to 
individual consignments, the needs and benefits of risk management will be eve n more significant, 
particularly for MSMEs.  
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   2013     |      THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s                                  USAID.GOV  
 
 
 Art. 7 -6 Establishment and Publication of Average Release Times  - Members are encouraged to 
measure and publish their average release time of goods periodically.  
Organizations are increasingly being encouraged to  measure their performance with respect to users 
and in so doing, identify areas of improvement. The TFA likewise recommends the introduction of such 
a metric for “average release time of goods” which might span Customs and other border agencies. The 
TFA suggests using the  World Customs Organization  (WCO )’s Time Release Study, which measures the 
time between a shipment’s registration and its exit from the port of entry. Regular measurement would 
both encourage the monitored agencies to improve their perform ance, especially if the reports are 
broadly available, and help identify bottlenecks for improvement. In this respect, this “simple” 
administrative measure may lower costs, in addition to saving businesses’ time. 
Consistent with the principle that a rising  tide lifts all boats, any one of the above measures will shrink 
the time necessary to clear at least some shipments, thus reducing the queuing time for all. Less time at 
the entry and exit points of a given country will reduce the costs that derive from m oving goods in and 
out, making trade a viable instrument of economic growth. In addition to these time and cost savings, 
the TFA’s measures would therefore result in a greater volume of products being traded, and 
consequently more government revenues from Customs and other border agency fees and higher 
turnover for businesses.  
FEES AND PENALTIES  
With the gradual erosion of tariff rates over the past three decades, other aspects of trade have come 
to the forefront, culminating in the TFA itself. Yet beyond m aking the process of trade more transparent 
and providing for a stable environment with set rules for all, the strictly financial facet of clearing goods remains an important one for MSMEs, especially on smaller shipments, where fees can be prohibitive. 
Article 6 gives Disciplines on Fees and Charges Imposed on or in Connection with Importation and  
Exportation and Penalties.  
Art. 6 -1 General Disciplines provides for adequate advance publication of the fees and charges, their 
rationale, the responsible autho rity and the payment method, and for periodic review. Art. 6 -2 Specific 
Disciplines  imposes limits on the amount of fees and charges, which shall be commensurate with the 
services rendered.  
Together these provisions bring clarity to the fees that can be ch arged on moving imports and exports, 
by which agency, and how and when they must be paid. This allows for better budgeting. Periodic review of these fees is intended to encourage their removal where administration costs exceed the revenues 
they bring in, which is often the case on smaller shipments or lower -risk items. It is expected that these 
measures will lead to a reduction of border- related fees, further benefitting MSMEs.  
Art. 10- 9 Temporary Admission of Goods and Inward and Outward Processing  - Membe rs 
shall allow the suspension of duties on goods imported temporarily which will not undergo change in -
country, imported parts or materials for use in exports, or locally -produced or previously- imported 
goods that were temporarily exported (e.g. for repair s). 
This provision will directly save taxes and duties on shipments of product samples, testing equipment, items for repair, and manufacturing inputs . In the modern economy, the ability to move goods across 
borders temporarily is key to running more sophis ticated production lines. Doing so without paying 
taxes is particularly important for smaller businesses which may not have much cash available to tie up, 
especially if production is dependent on imported inputs or suspended pending reimport of repaired 
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   21USAID.GOV THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      |     14 equipment. Waiving taxes and duties also speed s cargo movement which reduces costs and clearance 
times.  
Art. 6- 3 Penalty Disciplines  - Penalties are imposed for a breach of Customs laws, regulations, or 
procedures. They shall depend on the facts of the trans action and must be commensurate with the 
severity of the breach. Members shall maintain measures to avoid conflicts of interest in the assessment 
and collection of penalties. When a person voluntarily discloses a breach prior to its discovery by 
Customs ad ministration, this fact shall be considered as a potential mitigating factor.  
This measure is  of particular relevance to MSMEs, in that it prevents Customs from applying 
disproportionate penalties for minor errors to which smaller businesses might be more prone. Penalties 
must be justified, which allows a business to seek an appeal where this is not sufficiently documented. Penalties should also be designed so as to avoid conflicts of interest. Any system that comprises complex or opaque rules encourages some rent -seeking and the use of “speed- money,” in other words, 
corruption.
7 This has costs fo r businesses (and potential lost revenues for the government) and because 
it is arbitrary, makes the process and its costs less predictable. Corruption disproportionately affects 
MSMEs, as they have limited  financial means  and weaker legal recourse, making  them easier prey and 
increasing the impact of penalties  when they make illegal payments.  
CONSULTATIONS AND APPEALS  
Disputes over goods shipments are daily occurrences, spanning documentation, tariff classification, 
valuation, and any number of other issues. They are costly and burdensome to businesses and Customs 
authorities alike. Where the rules are not published and disseminated openly and regularly, the 
environment for trade and business is uncertain and risky, and opportunities for corruption abound.  
Consumer groups, civil society, MSMEs, and parliamentarians have not typically participated in 
supervising trade, neither when rules and procedures are drafted nor where there are disputes. Yet 
giving a voice to business in particular, including MSMEs, is key in alleviating problems upstream and 
down. The TFA recognizes the importance of dialogue, specifically in Articles 2 (Opportunity to comment and information before entry into force and consultation), 4 (Appeal or review procedures), 5 
(Other measures t o enhance impartiality, non- discrimination and transparency) , and 10.8 (Rejected 
Goods).  
Art. 2- 1 Opportunity to Comment and Information before Entry into Force  – Members shall 
provide opportunities and appropriate time for interested parties to comment on  proposed laws and 
regulations. Changes to duty and tariff rates, measures that have a “relieving effect” and urgent changes are exempt from this notification.  
7 A 2009 study found t hat illegal payments could make up to six times the monthly salary of a port official in Southern Africa 
(Shepherd, 2009).  
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 This provision gives time for business to learn about newly  proposed or changed rules. This period 
should serve both to provide Customs with comments on how the change might be introduced (or 
perhaps modified), and for traders to make appro priate 
adjustments. Opportunities to learn in advance about 
prospective changes to the system, as well as opportunities to 
open a dialogue, add to a stable trading environment with lags 
between issuing a rule and its enforcement. This also provides 
a platform for constructive dialogue between business and 
Customs and other border agencies, detached from specific 
trades or conflicts. 
Art. 2 -2 Consultations  – Each Member shall provide for regular consultations between its border 
agencies and traders or other stakeholders located within its territory.  
The intent behind this provision is to allow business (and civil society) to participate in the design of the  
laws and rules that govern trade. The private sector is in a position to represent difficulties in complying 
and to offer alternative solutions that are more business -friendly. Customs will have to consider these 
recommendations, thereby limiting potentia l negative effects on trade and compliance. The consultations 
also give businesses some time to adapt to proposed changes.  
For Customs and other border agencies, consulting with the public and businesses yields several 
advantages, including access to free expert advice from the system’s users, the possibility of delegating 
various functions to traders themselves (with potential further savings for business), and a strong positive signal to the international business community (which may bring inward investm ent). 
In fact, the TFA places so much emphasis on transparency and consultation that one of its key 
instruments is the National Trade Facilitation Committee (NTFC). Such committees are a requirement 
of the agreement and are designed to bring together government, the private sector, and civil society. NTFCs are venues for exchange and discussion, as well as potential ‘think tanks’ for new national 
initiatives and legislation. Ecuador launched an NTFC in 2019 to establish the political will to help public 
and private sector representatives to respond more quickly to the ever -changing landscape of 
international trade. Together with the private sector, the range of agencies working on trade developed 
a road map to decrease bureaucracy and simplify, harmonize, an d automate procedures. The 
Government of Ecuador emphasized the importance of private sector participation throughout this process to identify trade barriers and propose solutions to increase compliance and trade flows.
8 While 
not specifically designed wi th MSMEs in mind, NTFCs are a specific TFA effort aimed at active private 
sector engagement.  
The TFA covers both general, high -level consultation and exchanges on rules and procedures and 
practical applications in daily operations, per the Articles below.  
Art. 4 Procedures for Appeal or Review - Customs must provide reasons for its decisions. Any 
person to whom Customs issues an administrative decision has the right to an independent 
administrative and/or judicial review.  
This provision allows for Customs decisions to be reviewed and potentially reversed. It addresses 
concerns (and costs) resulting from errors, arbitrary decisions, and undue delays. It allows for 
 
8 https://www.youtube.com/embed/BKtCxtNA15M? . 
In Vietnam, draft regulations 
are frequently discussed with 
the Association of Small and 
Medium Enterprises  
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   23USAID.GOV THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      |     16 transparency and provides a basis for appeal. Administrative appeals bring additional benefits, especially 
for MSMEs, in that they are less formal and thus faster and less costly than other options  such as going 
to court. 
The TFA is an agreement to govern all trade. It does not discriminate between traders or goods.  
However, some products face unique obstacles. These include food and other agricultural products 
whose scrutiny goes beyond Customs to various health and safety authorities. In developing and least developed countries, a significant share of trade is often made up by MSMEs moving agricultural goods. The interruption of this trade can be particularly grievous as damage to agricultural products can occur quickly and irreversibly. Certain provisions of the TFA are specifically relevant to these products and 
traders, as follows. 
Art. 5- 2 Detention  - Members shall promptly inform in case of detention of goods for inspection.  
This is especially relevant for perishables which incur refrigeration costs and can spoil: knowing that a 
shipment is detained is the first  step to taking action for its release or care. With this provision, any 
trader whose shipment is held up must be notified quickly, allowing for the opportunity to obtain supporting documents or appropriate storage and handling. This should reduce the costs related to both 
holds at the port of entry/exit and potential deterioration of the cargo itself.  
Art. 7- 9 Perishable Goods  - With a view to preventing avoidable loss or deterioration of perishable 
goods, they must be released within the shortest possible  time, given appropriate priority and properly 
stored pending release.  
This measure reduces the risk of spoilage or shortened shelf -life and consequent loss of value for 
perishable products. Attendant costs include special handling and storage, insurance f or high- value items, 
and likely lost sales and revenues. It is envisioned that border agencies will not only give priority but 
indeed attend to such cargo on a demand basis, maintaining flexible operating hours and the like. This is invaluable for all trad e tied to fragile products whose damage can constitute severe losses. There are 
significant benefits to adhering to this provision  due to the importance of perishable goods to the trade 
of developing countries and LDCs, and to MSMEs themselves . 
HARMONIZATI ON ACROSS BORDERS  
The TFA includes a number of specific recommendations for facilitating the movement of goods at the border. It also recommends a set of best practices in the general approach to border -crossing, 
recognizing the need to strike a careful ba lance between ease of traffic and the need for compliance and 
security. Traditionally, Customs and other border agencies were tasked with raising revenues and with ensuring only legitimate trade was allowed, as illustrated in Figure 2 below. Today’s approa ch to trade, 
combining facilitation and risk management, is the foundation of the figure: Customs and other trade 
management agencies must implement trade facilitation as a tool to secur e legitimate trade and, to a 
lesser and declining extent, revenues. In doing so, the necessity to coordinate and cooperate is both 
internal to a country across its own trade -related agencies, and across its borders with foreign 
counterparts. The TFA addresses both  types of harmonization, in particular through Articles 8 (Border 
Agency Cooperation), 10 (Formalities Connected with Importation, Exportation and Transit) , and 12 
(Customs Cooperation). 
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   2417     |      THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      USAID.GOV FIGURE 2. THE TRADE FACILITATION BALANCING ACT  
Art. 8.1 Internal agency cooperation  - Each Member shall ensure that its authorities and agencies 
responsible for border controls and procedures dealing with the importation, exportation, and transit of 
goods cooperate with one another and coordinate their  activities in order to facilitate trade.  
The TFA is clear in its imperative that countries should coordinate their agencies across all trade 
management functions in order to facilitate trade . When Customs, the border police, or the food, plant, 
or animal  safety agencies fail to coordinate, they markedly slow down trade. Multiple checks remain 
commonplace and can be especially predatory for MSMEs, unduly raising costs. The TFA expects that responsible agencies will adopt common border procedures, uniform d ocumentation requirements 
(including across entry points), align hours of operations, and ideally share office space, so that importers and exporters alike find the process of clearing goods more transparent and easier to comply with. Not having to present  multiple documents in various formats at several offices, possibly operating 
in different locations or during different hours, allows for significant savings in time, effort, and costs, especially for MSMEs which have limited resources to devote to moving  their inputs and outputs at the 
border. Figure 3 below provides an illustrative layout of an integrated border crossing point with 
capacity to accommodate up to 100 vehicles per day. As shown, there is offsite parking to reduce 
congestion at the crossing,  separate sides for import and export traffic to allow for faster processing, 
and a central building gathering the agents of all the border agencies. In this way, both sides of trade flow 
separately, consequently dealings with all border agencies are smoot her and more efficient. 
Revenue Protection  
 Safety & Security  
Adapted from  UNECE 2012.  
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   25USAID.GOV   THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      |     18 
 
 
 FIGURE 3. ILLUSTRATIVE LAYOUT OF A BCP UP TO 100 VEHICLES PER DAY  
Art. 8.2 External agency cooperation  - Each Member shall cooperate on mutually agreed terms with 
other Members to coordinate procedures at border crossings to facilitate cross -border trade.  
Again, the TFA underscores the need for counterparts across borders to coordinate so that trade may 
flow more easily. The recommended coordination includes aligning hours of operation, procedures, and 
formalities, sharing facilities, and implementing one -stop border posts. Properly administered, such 
cooperation yields significant savings to traders . It also serve s the control agencies on both sides of the 
border by reducing the burden of checks and controls. Such cooperation would therefore result in time and cost savings for all sides of trade and clearance: border agents can concentrate on one direction of 
trade and traders have a dedicated interlocutor to deal with.  
Risk management would be greatly enhanced by cooperation across borders: the sharing of information, 
systems, and facilities minimizes duplication of effort and costs. It is worth noting that  Article 12 
(Customs Cooperation), which specifically discusses best practices in managing customs compliance, emphasizes the protection of confidential business information in cross -border exchanges.  
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   2619     |      THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s                                  USAID.GOV Art 10- 3 Use of International Standards - Members are e ncouraged to use relevant international 
standards as a basis for their import, export, or transit formalities and procedures.  
While much can be done at home to facilitate the movement of goods, borders by their nature separate 
more than one country. Modern  production, spread as it is across many countries, crosses multiple 
borders. Facilitating trade naturally involves smoothing inward, outward, and through movement. This 
requires the cooperation of all parties involved (importing, exporting, and transit co untries). Where 
each country uses its own forms and procedures, business is burdened by the multiplication of 
documents and steps, as well as po tential  language difficulties. All of these factors  raise costs  for MSMEs , 
often prohibitively. The adoption of international standards in data requirements, documentation , and 
trade procedures – along the lines developed by the WCO or the United Nations Economic 
Commission for Europe (UNECE ) – increases predictability, simplifies the process, encourages 
compliance, and reduces costs, all to the benefit of MSMEs.  
The TFA’s overall promotion of common international norms and standards encourages countries not only to simplify their own procedures but to align them to each other’s, which in turn makes it easier 
for bus inesses, especially MSMEs with limited resources, to be in compliance and to exploit 
opportunities from trade.  
Art. 10-5 Pre-shipment Inspection  - Members shall not require the use of pre -shipment inspections 
in relation to tariff classification and custom s valuation.  
Pre-shipment inspections (PSI) were historically introduced in response to weak customs 
administrations in importing countries. The PSI process require s private companies in the exporting 
country to verify the quantity, customs classification,  price, and quality of exports on behalf of the 
importing country.  
Almost since introduction, PSI have been criticized as adding costs and delays: they are therefore 
antithetical to trade facilitation. While these inspections are increasingly out of favor , the TFA bans their 
use outright for the purpose of customs valuation and classification. (While PSI may be used for safety 
or quality, even these uses are discouraged). Removing PSI recognizes the international development of 
Customs capacity and Customs  cooperation, lifts an administrative burden on Customs, and saves time 
and costs for business, with particular benefits accruing to smaller, more financially-constrained traders.  
E-SYSTEM S
As repeatedly seen throughout this document, the TFA aims to streamline and simplify the movement of goods. It lists a number of 
documents, processes, and procedures involved in trade with a view to 
assessing their true added value in the administration of  trade and 
consideration of their possible elimination. These practical steps to the 
reengineering of Customs extend beyond correcting inefficiencies to the establishment of a new, digital system of trade. Two a rticles in particular encourage Member states  to move away from paper -based 
systems.   
Art. 7- 2 Electronic Payment  - Members shall allow, to the extent practicable,  the option of electronic 
payment for duties, taxes, fees , and charges collected by C ustoms.  
Korea’s Single Window 
connects 14 agencies 
and 162 services.  
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   27USAID.GOV   THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      |     20 
 
 
 1) Electronic payments can reduce both the time and the cost of clearing Customs ; 
2) Quicker payment means quicker release where the two are tied electronically;  
3) Manual payments take time to edit bills and receipts, receive and verify monies;  
4) Physical payments also carry risk  both to the safety of the  cash-holder, and promote 
opportunit ies for corruption ; 
5) Integrated systems have internal error checks (reducing input errors) and remove 
opportunities for discretion (no money changes hands);  
6) Integrated systems can also allow for release independent of actual cash movement (by sending 
a notice that a payment has been made or relevant information has been submitted).  
In addition to saving time at clearance, e -payments can be made remotely, at a time convenient to the 
business, and leave records for book -keeping. These factors allow  MSMEs more flexibility to deal with 
shipments on their own schedule and can help with accounting, all of which saves time and money.  
Art. 10- 4 Single Window – Members shall endeavor to establish or maintain a single window. 
The adv antages of a single window are multiple, and all tend towards saving time and costs. Historically, 
businesses must approach each border control agency in turn, in person, at different locations, often 
presenting the same information in different formats  and incurring substantial costs. A single window 
centralizes all procedures and documents in one system, removing the need to “run around,” the risk of 
errors, and the potential for uncertainty.  
Such a system requires much back -office streamlining and emphas izes harmonization of both import and 
export procedures of all the agencies involved, further shrinking time and costs for business users. It can ultimately lead to alignment with other countries’ systems, further facilitating cross -border trade.  
There is, however, a challenge to the automation of border procedures. While Customs tends to focus 
on the cost of the hardware required to support e- payments or single windows, these costs are 
relatively small and are often absorbed in larger Customs reengineering  efforts supported by donors. 
The real obstacle is assuring the connectivity of users. As the general trend, exemplified by the TFA, is 
towards increasingly paperless trade, the ability to get online will become paramount. In many 
developing and least developed countries, businesses –  especially MSMEs –  struggle with internet access. 
The wider use of cellphones can assist, provided appropriate apps and required legal instruments are put 
in place. As well as beneficiaries of e -systems, MSMEs therefore  can be strong advocates for their 
introduction as a leveler of the playing field and booster of business and revenues.  
Figure 4 below reviews  the benefits of the TFA to MSMEs. It must be highlighted that the combined 
effect of full implementatio n would be greater than the sum of the benefits from individual measures. 
This is in part because moving obstacles along the line does not help as much as removing them, but also 
because proper TFA implementation really implies a change of approach and att itudes. Finally, TFA 
benefits accrue not only to importers and exporters, but to the public agencies involved, as well as producers, consumers, investors , and workers.  
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   2821     |      THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      USAID.GOV FIGURE 4. SUMMARY OF TFA BENEFITS TO MSME S
SPECIFIC TFA MEASURE  BENEFITS 
Art. 1 -1 Publication  Information costs saved  
Art. 1 -2 Information Available Through Internet  Clear estimation of import/export costs  
Art. 1 -3 Enquiry Points Delays, fees, and penalties avoided  
Art. 1 -4 Notification Presence, translation, and legal costs saved  
Art. 3 Advance Rulings  Clear direction on classification, origin, and other relevant 
customs clearance information 
Delays and attendant costs avoided  
Time saved (for term rulings)  
Information costs saved (with published rulings)  
Art. 7 -1 Pre-arrival Processing Reduced release time for goods 
Reduced delays at border crossings and/or entry points  
Reduced handling costs  
Art. 7 -3 Separation of Release from Final  
Determination of Customs Duties,  
Taxes, Fees , and Charges Reduced release time for goods  
Reduced handling costs  
Quicker, more predictable deliveries  
More affordable guarantees  
Art. 7 -8 Expedited Shipment  Quicker, more predictable deliveries  
Waived duties (usual practice)  
Art. 7 -7 Trade Facilitation Measures for  
Authorized Operators  Time and costs saved 
Quicker, more predictable deliveries  
Deferred payments (usual practice)  
Known trader status  
Art. 10 -2 Acceptance of Copies  Time and costs saved 
Art. 10 -6 Use of Customs Brokers  Costs saved  
More control over clearance 
Art. 7 -4 Risk Management  Reduced release time for goods 
Reduced handling (costs)  
Quicker processing  
Art. 7 -5 Post -clearance Audit Reduced release time for goods 
Quicker, more predictable deliveries  
Deferred payments  
Known trader status  
Art. 7 -6 Establishment and Publication of  
Average Release Times    Increased transparency 
Time and costs saved 
Art. 6 -1 General Disciplines  Information costs saved  
Art. 6 -2 Specific Disciplines Clear estimation of budgets  
Art. 10 -9 Temporary Admission of Goods  
and Inward and Outward Processing Du
ties on temporary imports/exports avoided  
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   29USAID.GOV  THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      |     22 Art. 6 -3 Penalty Disciplines  Reduced penalty costs  
Possibility of appeal  
Reduced corruption costs  
Art. 2 -1 Opportunity to Comment and  
       Information before Entry into Force  
Art. 2 -2 Consultations  Reduced information costs  
Opportunity to comment/influence  
Art. 4 Procedures for Appeal or Review  Reduced costs from arbitrary process, errors, or appeal  
Increased transparency  
Art. 5 -2 Detention  Reduced handling and storage costs  
Reduced losses from spoilage  
Art. 5 -3 Test Procedures  Reversal of rejected shipments  
More visible compliance  
Art. 7 -9 Perishable Goods  Reduced handling and storage costs  
Reduced insurance costs  
Reduced losses from spoilage  
Art. 8.1 Internal Agency Cooperation  
Art. 8.2 External  Agency Cooperation  
Art 10 -3 Use of International Standards  Time and costs saved 
Lower cost of compliance 
Art. 10 -5 Pre- shipment Inspection  Faster processing and release time  
Art. 7 -2 Electronic Payment  Faster processing  
Reduced risk of errors  
Easier, more cost -effective compliance  
Art. 10 -4 Single Window  Reduced release time for goods 
Lower cost of compliance  
MAINSTREAMING TRADE FACILITATION  
While the above sections have sought to provide information on specific articles of the TFA and how 
these measures would save MSMEs time and money, it is important to understand that the Agreement 
has much broader aims that transcend its specific provisions. The aspiration is very  much to mainstream 
trade facilitation itself. Trade by its very nature has significant linkages to most sectors and impacts the 
economy at large. Mainstreaming trade facilitation acknowledges trade as an engine for economic growth and poverty reduction. Mainstreaming trade facilitation into national strategies and policy 
reforms contributes to a coherent approach to a better business environment and improved opportunities for the whole country: improving access to information, reducing costs, building capa city, 
encouraging product and market diversification, bolstering safety and security, enhancing services, modernizing infrastructure, using digital tools for inclusion, etc. , all of which have corresponding benefits 
for businesses. Building on the earlier discussion , this section encourages the implement ation of  the 
tools detailed in the TFA in the spirit of broader trade facilitation goals. This has the potential to improve the trade experience of MSMEs, among others, and aid in the ir formalization, compli ance, and 
development.   
Accessible enquiry points  – “Information is power.” The TFA provides for set and precise rules to 
be available to all interested parties. This is to be achieved through online publication, preferably in 
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   3023     |      THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      USAID.GOV several languages. As a first step, accessing information in a passive way can answer many preliminary 
questions. The TFA goes further, providing for human assistance, in -person and preferably at several 
locations where business might visit. Although the TFA is focused on Customs and border agencies, it 
should be understood that access to information both passive and active is expected to be  
mainstreamed across the board to facilitate trade. Removing unknowns is viewed as a keystone to trade 
facilitation, particularly for smaller, less experienced traders . 
According to the OECD,  “redundant or sequential controls, duplicative documentation requirements 
and insufficient coordination between responsible agencies may exacerbate delays and impose unnecessary costs on traders, decrease efficiency of controls at border crossings, and strain resources 
at border posts.”
9 Efforts to mainstream trade facilitation seek to reduce the number of agencies, 
documents , and steps in a general risk management approach.  One strategy is to identify MSMEs as ‘low 
risk’ by virtue of their small trade footprint and lower their cost of compliance, in particular by reducing 
the fees to which they are subject. Mainstreaming trade facilitation may thus entail reduced fees for 
qualified MSMEs . This would recognize that MSMEs have shallower financial and cashflow means than 
their large counterparts, and less margin for error. To support them in their search for international opportunities, granting certain MSMEs a special status would allow for some ups tream clearance (based 
on documentation and other undertakings). And establishing a relationship with control agencies could 
justify reduced fees: known traders demand less work.  
In the broader context of mainstreaming trade facilitation, risk management of trade is, if not a silver 
bullet, a key tool.  Authorized Economic Operator (AEO)
10 programs are one instrument for risk 
management, and their simplification can be tailored to MSME capacity through  two-tier 
accreditation criteria, allowing MSMEs to meet more basic criteria than larger counterparts. This 
would mean no major changes or investments for MSMEs, at least in early stages. Customs should 
provide consulting and education for MSMEs wishing to qualify for AEO status, assisting them in 
understanding how the system works and what it demands of business users, while Customs might learn 
from MSMEs about their experience and better appreciate whether the benefits offered to MSMEs align 
with the requirements they face. Figure 5 below highlights the typica l requirements and benefits of an 
AEO system: in exchange for maintaining a transparent and compliant business, an AEO can expect to 
produce less documents, be subject to fewer inspections, have payments deferred and separated from 
actual clearance, secure  lower guarantees , and even have clearance done at their own premises rather 
than at points of entry and exit.  
While many countries have yet to adopt Single Windows , which entail significant start-up costs in 
reengineering and equipment, those with Single Windows extol their value. Making Single Windows 
accessible to MSMEs is an important feature of mainstreaming trade facilitation. This e -system  makes 
interfacing with smaller businesses easier, provided appropriate support is given – Singapore and 
Thailand  are held up as examples of success in making their single windows MSME -friendly, which they 
have done by specifically training MSMEs on how to use the system.  
9 OECD, “Trade Facilitation and the Global Economy,” 2018, page 10.  
10 See https://doi.org/10.1787/9789264277571- en, Compendium of AEO Programmes, WCO, 2020. 
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   31USAID.GOV THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      |     24 FIGURE 5. AEO PROGRAMS: ACCREDITATION CRITERIA AND BENEFITS TO MSME s 
As previously discussed, e vidence shows that MSMEs react more positively to “soft” trade facilitation 
measures, which includes reduced documentation and other data requirements, lower guarantees and 
other thresholds, streamlined d eclarations and procedures, etc.  Such measures should therefore be 
given priority, by developing countries and LDCs in particular, in boosting trade facilitation for MSMEs.  
Finally, to mainstream trade facilitation means to pursue it actively not only at hom e but with partner 
countries. Several TFA provisions will have their benefits multiplied  by being implemented by both 
trade partners. Adopting shared approaches, methods, tools, and standards will undoubtedly increase 
these benefits. Although MSMEs may attach more importance to their own country’s systems initially, 
going international will mean an interest in both target markets as well as input suppliers – and 
encouraging trade facilitation across borders will amplify these benefits.  
Adapted from  ITC 2015.  
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   3225     |      THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      USAID.GOV It is important to  underscore the risks for those countries and regions which lag behind in trade 
facilitation efforts, as they have the most to lose. Locations where goods flow more smoothly, at less 
cost and with more predictability , will see not only their trade increase  but also inward investment, as 
producers look to base their operations where inputs and intermediate goods can be easily brought in 
and exports of value -added intermediates or final products can seamlessly move on to their desired 
destination.  
Indeed, the  prevalence of trade facilitation discussions both at the WTO and in regional trade 
negotiations has resulted in cross -fertilization: the TFA consolidates many of the trade facilitation 
measures which countries and regional groupings have explored in recen t years, while regional trade 
agreements developed from the 2000s onwards all include substantive trade facilitation aspects.  
WHAT THE TFA DOES NOT DO  
This paper has reported on the remarkable benefits to be reaped from even partial implementation of 
the TFA. Although the Agreement was devised looking at existing trade participants – overridingly larger 
firms – MSMEs would greatly enjoy the rewards of clearer, impartial, and streamlined processes as 
mandated by the TFA. Trade has link ages to all sectors of the economy. It would be impossible for a 
single agreement to address them all, as outlined in Figure 6  (on the following page). Indeed, this in part 
explains the multitude of international agreements within the WTO, as well as the p roliferation of 
bilateral and multilateral agreements. Though it was neither the intention nor the purpose of the TFA to address all issues critical to MSME development, this section briefly comments on these factors not covered by the Agreement.
11 
While p rovisions of the TFA argue for certain infrastructural improvements in particular at border 
crossing points, the internal transport and logistics needs of a country will remain outside its remit: to 
ensure their MSMEs access trade, countries will have to d iagnose their needs and seek investment 
support in transport, logistics, and infrastructure. In parallel, countries will need to develop a suite of affordable services that nurture the growth of small businesses. This includes Business Development Services to help overcome capacity limitations of MSMEs, and access to finance, particularly trade 
finance, which is a formidable constraint to smaller firms. Finally, attitudes toward entrepreneurship may need to adjust. In many developing countries, the prevalen ce of microenterprises reflects a lack of other 
commercial opportunities, and the society may not appreciate that  this is where the large, successful 
businesses originated. Recognizing a spirit of entrepreneurship as a steppingstone to financial success 
would improve the prospects of smaller enterprises to grow and flourish.  
In noting these limitations to the scope of the TFA, its enormous benefits should not be diminished or 
misunderstood. Indeed, it has been suggested that the TFA will have a bigger impa ct on reducing trade 
costs than eliminating all remaining tariffs.
12 Perhaps more importantly, proper implementation will, as 
suggested in earlier sections, improve not only the experience of a select few, but of society  as a whole. 
More openness and greater transparency a re powerful engines of growth and development.  
11	The TFA concentrates on trade in goods. While several of the measures may indirectly benefit trade in services, the 
experience of MSMEs providing services lies outside the  scope of this paper.	
12 1,414 protectionist measures remain in force since October 2008, mostly by G20 countries (PIIE 2013).  
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   33USAID.GOV THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      |     26 FIGURE 6. THE TRADE UNIVERSE AND THE TFA  
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   3427     |      THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s                                  USAID.GOV  
 
 
 THE TRADE FACILITATION AGREEMENT: A BRIEF OVERVIEW  
 
 
 
 
 
 
WHAT IS TRADE FACILITATION?  
“Trade facilitation reforms improve a country’s trade competitiveness and 
enhance its revenue collection. What is more, they can help advance development 
goals such as strengthening governance and formalizing the informal sector. In 
addition, since many trade facilitation- related challenges and solutions are 
regional, the implementation of such solutions can boost regional integration.”   
– United Nations Conf erence on Trade and Development ( UNCTAD) , Policy 
Brief no. 42, December 2015  
Trade facilitation can cover many different aspects of promoting trade flows. Indeed, the term varies in 
interpretation from one user or institution to the next. This is in part b ecause trade is pervasive: it is fed 
by and feeds into most if not all sectors of the economy. In today’s production scheme, broken up 
across countries and borders, trade is everywhere. Easing trade might therefore refer to any number of 
actions.  
Much of t he focus of trade negotiations from the 1970s was on reducing the highly visible barriers and 
consequent costs on trade: tariffs , quotas, and technical restrictions. As these were eroded, and as trade 
grew, a much more complex picture of trade costs emerge d, as illustrated in Figure 7 below. The three 
phases of trade are shown, highlighting its multifaceted nature. In getting to the border, a prospective 
trader might encounter difficulties with getting credit or foreign exchange to finance the venture, a 
collusive logistics industry, or inefficient road and rail networks or ports. Once at the border – the focus 
of the TFA – exporters and importers might face direct, indirect, and hidden costs. These may include 
specific documents and tariffs (and possible ex port restrictions) ; delays causing inventory holding costs 
and possible losses, as well as possible lost opportunities; and corruption. On the other side of the border, there might still be regulations (non -tariff measures) limiting trade; a less than cond ucive 
business environment; and direct and indirect barriers in particular on services trade. While trade facilitation might involve any or all of these aspects, “trade facilitation” typically refers to the middle section of the diagram, that concerned wit h imports, exports, and transit at the border . 
 WTO members concluded negotiations at the 2013 Bali Ministerial Conference on the landmark 
Trade Facilitation Agreement (TFA), which entered i nto force on February 22, 2017 following its 
ratification by two -thirds of the WTO membership. The TFA contains provisions for expediting the 
movement, release and clearance of goods, including goods in transit. It also sets out measures for effective cooperation between customs and other appropriate authorities on trade facilitation and 
customs compliance issues. It further contains provisions for technical assistance and capacity building 
in this area. 
https://www.wto.org/english/tratop_e/tradfa_e/tradfa_e.htm#III   
 
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   35USAID.GOV THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      |     28 FIGURE 7. THE TRADE UNIVERSE AND THE TFA  
Source: OECD 2018  
Generally accepted trade restriction s include tariffs and other duties, quotas, national regulations , and 
exchange controls. While multilateral tra de negotiations, especially within the WTO system, have 
focused on these, trade facilitation refers to the much narrower context of the actual transactional facet 
of trade: how can goods move across border s faster and at lower cost? For the WTO, trade faci litation 
is defined as  
“the simplification and harmonization of international trade procedures, 
understood as the activities, practices and formalities involved in collecting, 
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   3629     |      THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      USAID.GOV presenting, communicating and processing data required for the movement of 
goods in international trade. ” 
Literature on trade facilitation refers to the price and efficiency effects of border crossings. Price effects 
are the increase in the final price of goods which results from direct costs such as tariffs and fees, and 
indirec t costs incurred in onerous or delayed clearance, for instance. These costs inflate the price of 
traded goods over their market level and can therefore curtail demand (and trade). Efficiency effects are 
the consequence of the diversion of resources to deal ing with the undue requirements of trading across 
borders. Because the process is cumbersome, it detracts from the core activities of production and 
trade, and indeed public resources allocated to managing trade. These efficiency costs may be less 
tangible, but they constitute genuine welfare losses to producers and consumers and governments in 
importing, exporting, and transit countries . 
Authors employ an iceberg metaphor to help understand that  the cost of transporting a product comes 
from the revenues an ticipated for the product. As the product moves across successive points of 
friction, the iceberg melts— that is, the product’s value melts along its trade route, as would an iceberg 
in the sun. Unlike melting ice however, trade frictions do not produce an ything: economists talk of 
deadweight loss, the difference between the price paid by consumers and the price received by 
producers resulting from inefficient procedures (the welfare losses to producers, consumers, and governments referred to above). These losses are detrimental to  the economy and its population.
13 
With respect to delays in trade, observers have gone beyond this exploration of direct and indirect 
costs (which might be especially egregious for MSMEs, LDCs, and developing countries involved in  
agricultural trade) to look at the actual value of prompt and reliable delivery. Today’s world moves fast 
and trade in a range of goods – not least textiles and consumer electronics – is about getting products 
to consumers quickly. Trade facilitation, by making the actual movement of goods easier, smoother, and 
speedier, may increase the worth of the product to the customer, that is generate a willingness to pay 
extra for expedited delivery. Measurements of trade facilitation efforts therefore attempt to c apture this 
additional benefit. 
A SHORT HISTORY OF THE TFA  
An informal group of countries began working on the TFA at the WTO Ministerial Conference in 
Singapore in 1996. Formal negotiations commenced in 2004, and the final text was adopted at the Bali Ministerial Conference in 2013.  By 2021 , almost all WTO Members have ratified the Agreement.  
The TFA is different from earlier WTO agreements and likely precedent -setting in some significant 
ways. One was its bottom- up development, with a subset of Members  pushing technical work before 
formal legal negotiations. Another is the built- in mechanisms whereby LDCs and developing countries 
can design their own implementation periods, per three categories. Provided they have properly notified as 
Category C, provis ions that require “the acquisition of assistance and support for capacity building” 
before the Member can implement them .  
13 The literature als o refers to “sand in the wheels.”  
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   37USAID.GOV THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      |     30 OVERVIEW OF THE TFA  
The TFA is divided into two sections. Section I sets out the substantive obligations to facilitate customs 
and bo rder procedures, while Section II provides special and differential treatment for developing 
countries and LDCs.  
Section I is subdivided into 12 Articles of varying length and detail, as follows:  
•Articles 1- 5 deal with transparency issues,
•Articles 6- 11 address fees and formalities for import, export
and transit, and
•Article 12 looks at Customs cooperation.
Section II provides that developing countries and LDCs can implement the TFA gradually, on their own 
schedule and can request assistance and support in doing so. Category A provisions are intended to be 
implemented  upon entry into force of the Agreement, and Category B benefits  from a transitional 
period as notified to the WTO’s membership. Category C provisions – if they are properly notified  – 
would come into effect after the Member has requested, agreed, and received support, as shown in 
Figure 8 below. 
The Enhanced Integrated 
Framework identifies high 
trade costs as a top -8 
challenge for MSMEs 
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   3831     |      THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s                                  USAID.GOV  
 
 
 FIGURE 8. CATEGORIES AND TIMELINES  
Source: WTO (2015) 
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   39USAID.GOV THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      |     32 GLOSSARY 
Authorized (Economic) Operator  A party involved in the international 
movement of goods, who has been approved 
by or on behalf of a national Customs 
administration as complying with specified 
supply chain security standards. (WCO 
definition)  
Business Development Services  The set of advice, information and skills 
needed to support a growing business through 
its establishment: accounting, financial, legal, 
managerial, marketing, etc.  
Category A, B, C (of the TFA)  Measures listed under Category A will be 
implemented when the TFA comes into force; 
Category B after a transitional period; and 
Category C after some conditional assistance and capacity building available through a range 
of donors.  
Enquiry point  An enquiry point can be defined as an official 
or an office designated to deal with queries 
from the public (and other WTO Members) on trade.  
Global value chain The people and activities involved in the 
production of a good or service and its supply, 
distribution, and post -sales activities, when 
activities are coordinated across countries.  
Post- clearance audit  Measures by which Customs satisfy themselves 
as to the accuracy and authenticity of 
declarations through the examination of the 
relevant books, records, business systems and 
commercial data held by persons concerned. 
(Revised Kyoto Convention)  
Risk management A systematic approach to recognizing and 
confronting threats in order to develop and 
apply appropriate types and levels of 
preventive and control procedures.  
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   4033     |      THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      USAID.GOV Single Window An intelligent facility that allows parties 
involved in trade and transport to lodge 
standardized information and documents with 
a single- entry point to fulfil l all import,  export, 
and transit-related regulatory requirements . 
(WCO) 
Sustainable Development Goals The 2030 Agenda for Sustainable 
Development, adopted by all United Nations 
Member States in 2015, provides a shared blueprint for peace and prosperity through 17 
Sustainable Development Goals (SDGs). 
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   41USAID.GOV THE TFA: A WORLD OF OPPORTUNITIES FOR MSME s      |     34 https://sustainabledevelopment.un.org/?menu=1300 
Trade Facilitation  The simplification and harmonization of 
international trade procedures, understood as 
the activities, practices, and formalities involved in collecting, presenting, and 
processing data required for the movement of goods in international trade (WTO definiti on). 
Trade Facilitation Indicators  Eleven TFIs were developed by the OECD in 
2012 to support governments in their efforts 
to improve their border procedures, reduce trade costs and reap greater benefits from 
international trade. They cover the full 
spectrum of administrative procedures at the border for 163 countries. TFIs are available for 
2012, 2015 and 2017, and range from 0 to 2 (best performance).  
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