meeting the ecommerce challenge post-customs electronic data exchange

POSTAL TECHNOLOGY CENTRE (DOT)© UPU 2014 – All rights reserved 1POSTAL TECHNOLOGY CENTRE

Meeting the eCommerce challenge

Post-Customs Electronic Data Exchange

WCO Knowledge Academy4th July 2014

Harald WeyerichDirector UPU Postal Technology Centre


Agenda

– Postal Supply Chain & Electronic Data Flow– Formal Basis Documents– Motivation for Electronic Exchange– Electronic Messages– The UPU Customs Declaration System (CDS)– Steps to the Electronic Data Exchange– Pilot countries– The Postal Export Guide (PEG)– CDS screenshots (Annex)


Postal Supply Chain & EDI message flow

EDI (XML) message Post-Customs:


Standard EDI network (POST*Net) operated by UPUSince 1996Private peer-to-peer network through internet, 24*7 100% availabilitySecured transport (VPN, SSL)Business continuityPerformant (0-5 min processing)Monitoring & alerting serviceUsed by 170 postal operatorsVery affordable (cost-based)Could be used also by other Int’l Organizations

Sender ReceiverExport post

Export customs

Carrier

Import customs

Import post

POST*Net

Transit post

The UPU Electronic Message Network

Track & Trace

(barcodes)

Level of detail:• Item, bag, dispatch

consignment• Consignment

• Item (declaration)• Item (query)


Agenda



Basis for the Customs treatment of postal items– Kyoto Protocol Annex J– Standard declaration

forms


Basis for the Customs treatment of postal items (2)

— WCO PTC decision (2011)At its 191st/192nd Sessions (22 to 25 March 2011), the WCO Permanent Technical Committee(PTC) decided:

141. Following this examination the focus group had concluded that in principle the WCOwas in a position to endorse the data requirements of the CUSITM/CUSRSP, on theunderstanding that it was a living information technology (IT) messaging guide which couldbe improved continuously based on developments in this field, including the results ofongoing pilot projects. To that end, the focus group had also recognized that in the future,any minor gaps could be filled through mutual consultation between the two Secretariats

146. The Meeting took note of the analysis carried out by the IMSC, and of the UPU’spresentation on the CUSITM/CUSRSP. It endorsed, in principle, the design and content ofthe CUSITM/CUSRSP as a tool developed jointly by the UPU and the WCO, and agreedthat it should be called “WCO-UPU Customs-Post Electronic Messages”.


Basis for the Customs treatment of postal items (3)– UPU Convention Article 9 (2012)

• 1 Member countries and their designated operators shall observe the security requirements defined in the UPU security standards and shall adopt and implement a proactive security strategy at all levels of postal operations to maintain and enhance the confidence of the general public in the postal services, in the inter ests of all officials involved. This strategy shall, in particular, include the principle of complying with requirements for providing electronic advance data on postal items identified in implementing provisions (including the type of, and criteria for, postal items) adopted by the Council of Adminis tration and Postal Operations Council, in accordance with UPU technical messaging standards. The strategy shall also include the exchange of information on maintaining the safe and secure transport and transit of mails between member countries and their designated operators.

• 2 Any security measures applied in the international postal transport chain must be

commen surate with the risks or threats that they seek to address, and must be implemented without ham pering worldwide mail flows or trade by taking into consideration the specificities of the mail network. Security measures that have a potential global impact on postal operations must be imple mented in an internationally coordinated and balanced manner, with the involvement of the relevant stakeholders.


Basis for the Customs treatment of postal items (4)– Under development:

« Postal Model » for Security-related electronic pre-advice


Agenda



Why electronic pre-advice for postal items ?– Legal requirements

• US, China, EU

– Security requirements• Pre-advice to be sent before item leaves country of origin• Confirmation of correct export processing to destination Customs and

transport airlines• Provide possibility for security alerts back to origin

– Reduce / maintain customs processing time• Customs decision making while item is on route• Possibility for « automated » Customs decisions for low-risk items• Postal volume increasing but not Customs staff• Direct inject possible from shippers/online shops


How can cost be minimised ?– Usage of UPU-WCO standard

• Avoids costly bespoke IT interfaces • Planned interface with ASYCUDA (end 2014)

– Usage of standard software• UPU CDS is currently the only IT system for postal customs declaration &

security

– More volume with same staff • By having the electronic declaration in advance (even before the item

leaves the origin country), there is enough time to do risk analysis and rating

• Automated pre-arrival preliminary decisions on selection for inspection and/or tax/duty rating for low-risk items saves manual workload, speeds up the import process and supports trade facilitation

– Of course any pre-arrival decision can be overridden anytime


The cost of inactivity– Postal items piling up

• With growing international eCommerce volume and no staff increase, bottleneck situations will occur

– Impact Increase of elapsed time retailer-to-buyer = decreased citizen satisfaction This will then be the opposite of Trade Facilitation


Major benefits • Reduce handling time at Posts and Customs and increase throughput • injection of electronic declarations directly from large mailers or internet

– Data entry by customers – not by the post !• declaration data can be fed into customs risk management systems –

– better targeting, trend analysis and reaction to security incidents/threats– concentrate Customs resources on highest threat areas– advance sender/recipient information for security checks

• better communication between Post and Customs• faster Customs clearance of mail items and improved service quality for

postal customers• Pre-advice and Pre-clearance can be used to collect duties/taxes in

advance• Security information/alerts can be fed back to origin country


Agenda



EDI (XML) messages: –CUSITM

• electronic version of paper customs declaration forms CN22,CN23,CP72

–CUSRSP• electronic answer from Customs/Border Control to

Post• item to be presented (mandatory)

– duties/taxes/other information (optional, if possible)

– security-related messages

– ITMATT• reserved only for customs data interchange between

Postal Operators

CommonUPU-WCOStandard

e.g. do-not-load msg

compliant with WCO Data Model

V3

Electronic Exchange Post-Customs


Customsin origin country

Postin origin country

CUSITMcopy CUSRSP

Message Flow CUSITM/CUSRSP/ITMATT

Customsin destination country

Postin destination country

CUSITMCUSRSP

ITMATTItem level details captured at origin

country• Individual enters data

online or at post office• Post office enters

data

• Shipper submits data via IT interface

• Capture at Hub or OE

CUSITM

CUSRSP

Styles: Normal flow Optional additional flow


Agenda



UPU Customs Declaration System (CDS)– The UPU created with CDS a full management system for

• Postal electronic pre-advice of merchandise to the destination Post/Customs

• With separated functions for– Postal use (capture & route pre-advice message)– Customs use (pre-select, decide, rate & taxation)– Security use (referrals/alerts to be sent to import and/or export post)

– Based on the joint WCO-UPU message standard– Customs can use CDS directly or interface it with its own

risk/rating system– CDS is ready to use since 1st Jan 2013 !

Use central solution hosted at UPU or Implement local solution (at post and/or Customs)


export Post import Post import Customsexport Customs

eCommerce

CDSIPS

CUSITM

CUSRSP

Post Office

OE

CUSITM

UPU

CDSIPS

CUSITM

CUSRSP

ITMATT

Configure• Selectivity rules• Rating rules (Tax calc.)• Feedback-to-origin rules

Feedback CUSRSP

CUSITM/CUSRSP flow optional flow Partial information flow configuration

UPU CDS V1 Work & Data flow

POST*Net

OE

Shipper’ssystem

Risk Mgt

Risk Mgt


Functionality overview: Postal Customs Declaration data capture (web service) X Import/export declaration data (files or API interface) X X Route declaration to partner Post (ITMATT message) X Route declaration to Customs/border control (CUSITM message) X Create response from Customs (CUSRSP message) including X

decision and feedback information to be forwarded to origin Post Receive response from Customs (CUSRSP message) and

possibly forward feedback information to origin Post X View/review/list/select declarations X X Cancel declarations X Transfer link to an image of the item (if provided by origin Post) X Selectivity rule engine X

(automaticaly select action for items based on rules) Rating rule engine (automatically calculate tax/duty based on rules) X FX (foreign exchange rate) management and conversion

(convert currency values to local currency) X X Audit trail (track and trace for actions on a declaration) X X Interaction with IPS (UPU mail mgt. System) X

All Customs configurations are hidden to postal users !


CDSv2 SP2 release in April 2014e-Commerce pre-clearance support. Option to send duties&taxes

response to originAbility to define multiple rules for a given customs decision/auto-

responseE.g. Present if item is EMS from Switzerland or Parcel from Canada.

Ability to define your own user groupsDaily exchange rates feedImproved user interface

Declaration layout, sorting of search, better support of non-standard mail item IDs, declared value in local currency

Operational process Decision code and reason displayed on pop up screens in IPS, focus removed from «Close»

button. Overall message look and feel improved (IPS 2013 SP3)

UPU CDS V2 new functionality


Web.API (automated & synchronous)

• Web application interface – direct call with SOAP protocol

File (automated & asynchronous)

• Files containing declarations / responses in CUSITM/CUSRSP format

Web Human Interface (manual)

• Web screens for entry/query

Shippers / large mailers

Postal systems Customs & securityIntegration of CDS into other systems

Risk Mgt / fiscal

e.g. ASYCUDA

Point-of-Sales

Back-office / Sorter

Office of Exchange Security

Postal website

Online shop

Purchase system

CDS


Agenda



The steps to electronic Customs data exchange– Cooperate with Posts

● Agree processes, show available UPU standards (CUSITM/CUSRSP) and tools (CDS)

● Participate in a Post-Customs coordination team

– Agree a pilot phase● Using CDS Central at the UPU to learn, test and review updated process

together with the Post● Use samples from partners (real data) loaded into CDS● Identify a possibly pilot corridor with one country● No cost involved besides workload for the Post-Customs coordination team


The steps to electronic Customs data exchange (2)– Agree on the data to be sent back to the Post

● Decision, e.g. pre-clearance (before arrival in country) of low-risk items● Feedback on import duties/taxes/other charges● Feedback on additonal documents needed● Possibly security related messages● Possibility to forward import cost feedback from destination customs to

origin post which can forward to shipper/online shop

– Assess impact on both postal and customs processes● Use opportunity to identify improvements in the process● Identify usage of IT systems (e.g. Customs can start to use CDS, if they

have no own system or they create an interface)

– Plan the Integration project• To implement the electronic exchange of data


New Opportunities– Prepayment of Customs taxes/duties by sender or receiver

● Avoids keeping items in warehouse just for tax collection reason

– Watchdog service• Shipper may cancel shipment and stop merchandise while it is in the postal

supply chain (at outbound or inbound scans)• Customs can use the functionality to manage referrals and interdict items


Agenda



AU

US(prod)

PT

CA(prod)

BR

HU

CZ

MA

> 100 000

declarations

HR RSZA

UY

UG

GB

IN

CL

Own solution – ready to send/receive ITMATT to/from CDSCDS user

UPU CDS Central – pilot exchanges (May 2014)


Local Pilot environment installationsCzech Republic Q4 2013Canada Q1 2013 (production planned Q2 2014)Portugal Q4 2013Australia Q3 2014

Piloting / Testing / Planning (CDS central)

Rep. of SerbiaCroatiaLatviaPortugalHungaryAustraliaEstonia

UPU CDS

• Brazil• Chile• Morocco• India• Malaysia• Belarus• Uruguay

• South Africa• Nigeria• SwissPost• Austria• Philippines• Thailand

Pilot partners:• Canada Post• USPSAre ready to exchange with any CDS user !


Agenda

– Postal Supply Chain & Electronic Data Flow– Formal Basis Documents– Motivation for Electronic Exchange– Electronic Messages– The UPU Customs Declaration System (CDS)– Steps to the Electronic Data Exchange– The Postal Export Guide (PEG)– CDS screenshots (Annex)


Postal Export Guide (PEG) – ContextThe PEG replaces two UPU publications by a Web Service with enhanced

possibilities for users.It can be separated in two sections:

Customs Matters Guide

Prohibited and

restricted articles

PEG

• Electronic list of prohibited and restricted items

• Search facility by country, HS code and description

• Customs Matters Guide – Single WCO–UPU Customs publication

• Result of a Questionnaire filled in jointly by Customs and Posts


Postal Export Guide &Customs Matters Guide - usage

Edit Validate

Queries via a web interface

Consult the PDF

Web services from any 3rd

party application

Postal Operatorand

Customs

UPU

Public


Customs Matters Guide - usage

« P » information

by Post

« C » information by Customs


Customs Matters Guide - usage

Post-Customsrelationship


Postal Export Guide - Prohibited and restricted articles

by UPU:• Import the WCO HS Codes, maintain the systemby country:• Translate each WCO HS Code description into the

country language.• Set the admissibility rules at level of code or range

of codes– Attach documents– Import procedures (local or global notes)– Charges

• Manage WCO HS Codes extensions at country level

• Textual search and code search.– Display all code results for a word search


live turkeysprohibited

preparations of turkey meat are

allowed

Postal Export Guide - Prohibited and restricted articles


Now the global note is attached to the selected good, further details can be added such as:

• Charges ( ): monetary charges.• Attachments ( ): for example a form to fill.• Notes ( ): more information about the restriction.• Origin countries ( ): if this restriction applies only to certain origin countries.

Prohibited and restricted articles – edit restriction


edit restrictionon banknotes



restriction showson the overview



Thank you !

Questions ?

please contact:Harald WeyerichDirector Postal Technology Centre, [email protected]


Agenda



CDS Example user interface

Main user screen(Customs admin)


CDS Example user interfacecustomer at Post office filling in a Customs Declaration

Reserved for image

(if available)


CDS Example user interface(Customs user)

Select aDeclaration....and sortBy columns



View a CustomsDeclaration& decide

Automatic calculation (if

rules are defined)



View Declarationhistory

Who did whatOn the

declaration


CDS Example user interface(Customs admin)

ManageAutomatedCustomsResponses(select rule)

Rules for each decision code



ManageAutomatedCustomsResponses(edit rule)

Flexible logical expression for rule definition



ManageAutomatedRating rules(edit rule)


CDS Example user interface (Customs admin)

Defining and executing Own reports


CN 22/23 forms

meeting the ecommerce challenge post-customs electronic data exchange

Documents

living information technology

upu security stan

upu convention article

data requirements

messaging guide

peer network

wco ptc decision

security requirements