Overview

Trade facilitation in a modern business environment and a global market place has to apply audit-based controls in order to establish full visibility for Customs administrations into the contractual and financial relationships between trading partners. Partnership approaches between Customs and the business community s must rely on the “trust but verify” principle. Post clearance audit is the control methodology enabling Customs and other authorities to verify whether the level of trust in a particular trader, e.g. authorized trader or AEO, was justified. Post clearance audit can help to reduce the risk of “false positive” as well as “false negative” risk assessments. Post clearance audit is therefore a critical component in the application of “risk management” systems.

Customs risk management is an important methodology and tool to assess the different risk levels associated with persons and shipments involved in international trade. In trusted partnerships, Customs and other authorities have gained detailed insight into internal control systems and the compliance level of the private sector partner. Consequently, this level of knowledge can be translated into a corresponding risk level and incorporated into the risk management system, enabling Customs to focus more on the higher risk traders.

Authorized traders as well as AEOs are rewarding elements for good compliance. They are the key to simplified procedures, better risk scoring and reduced inspections levels, hence faster and less costly trading. Post clearance audit is the key control methodology that needs to be in place to allow for greater simplification of the clearance process, such as immediate release.

Customs automation allows introducing or making better use of modern control techniques such as risk management. Automated risk management or access to a range of databases for intelligence gathering and analysis leads to better results, which in return allows for greater confidence in trade facilitation measures.

Non-intrusive inspection and detection equipment (NII) allows the inspection and verification of cargo, container and conveyances in order to identify those requiring physical examination, including unloading and opening of packages. The use of NII equipment therefore helps to save time and cost during the border crossing and clearance process.

With pre-arrival processing customs and other border agencies can improve their risk assessment and selectivity performance as they are using valuable time for risk assessment purposes without delaying the movement of the cargo. This process can and should lead to immediate release of those cargo shipments which have been assessed low risk.

Advance rulings are an important measure to create predictability and consistency in the trading process, two very important aims for a trusted partnership and for trade facilitation. Advance rulings rely on the trust that the trader during the validity period of the advance ruling (up to one year) imports those goods, for which the advance ruling has been issued. Post clearance audit can help Customs in the verification process.

By introducing greater coordination among border agencies with regard to the physical examination of the cargo, significant savings in the overall release time can be achieved.

Joint Border Controls
In addition to coordinated intervention among border agencies of the same country, an additional improvement in the clearance performance can be realized by conducting export and import controls at the border jointly and at the same time between two neighboring countries.