Paperless trade and PKI

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Paperless trade and PKI
July 2004
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Index

• Paperless Trade in Korea
• New Business Environment
• Paperless trade and PKI
• Global networking
• - PAA
• - e-Trade Hub
• - ASEM

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1. Key Initiatives of Paperless trade in Korea

• Government Initiatives
• Act on Promotion of Trade Business Automation
  Ministry of Commerce, Industry and Energy (Dec.
  1991)
• To improve trade process and national
  competence by reducing conventional processing
  time and cost through automation
• Scope of the Law
• Trade Administration, Foreign Exchange
• Establishment of Common e-Trade Platform KTNET
• KTNET adapt UN/EDIFACT for trade automation

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1. Key Initiatives of Paperless trade in Korea

• Government Initiatives by Korea Customs Services
  (KCS)
• KTNET is designated as Customs Network Provider
  by Korea Customs Services (KCS, Nov. 1992)
• Scope of Customs Automation
• Customs Clearance, Cargo Management, Duty
  draw back

KCS
KTNET
Endowment of Exclusive Biz. Right to KTNET
ISP/BPR for Customs Automation
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4. e-Docs for Korean Local Companies
Total about 300 e-Docs
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5. Benefits of Paperless Trade in Korea
Trade Volume (Unit Mil. US)
Cost Saving (Unit 100BWon)
Unit Mil.US/ KRW 100B
350
332,748
300
280,054
280,780
263,437
260,176
250
225,594
200
198,361
181.7
150
100
50
46.6
36.8
24.8
30.9
30.8
7.8
4.0
1994
1995
1996
1997
1998
1999
2000
SUM
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6. Benefits of e-Trade - Individual Case (SEC)
SAMSUNG ELECTRONICS
10K
22K
4Mil.
17B
Purchase Amount
Handling Doc.
12weeks
4weeks
89
43
Short Purchase LT
Employees in Customs Clearance
25days
5days
17steps
53steps
620boxes
30boxes
Used Paper
Processing Time
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6. Benefits of e-Trade - Individual Case (HMC)
Cost Saving in Purchase
Processing Cost
Comparison between Before and After of Adoption
of e-Trade in Individual Company
1020
90
100
100
8090
Before After
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Price
Cost per each Transaction
Processing Time
Inventory Cost
Doc.Handling Capacity
75
2550
90
3.9 m
100
20days
5070
1.6 m
5days
Period
Handling Doc. Per PAX
Inventory Cost
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1. Figures about Internet in Korea

• Internet Users
• 28 Million (63 of Total Population) 2002.12
• Public Certificates
• 9.1 Million Certificates (21 of Total
  Population) 2004.5
• Households Using Broad-band
• 10.4 Million (90 of Total Households) 2002.10
• Users of Internet Banking
• Corporate Over 400,000
• Private 16.9 Million (38 of Total Population)

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4. CASE e-C/O
Electronic Certificate of Origin (e-C/O)
E-C/O requester
E-C/O Verifier
E-C/O management system
C/O - C/O is an alternative to the
declaration or the certification and legalization
of the commercial invoice. - based on the rule
of the country of origin (produced, manufactured,
) expectations of e-C/O - fast circulations
of document - effective process (reissuing,
) - simple issuing and validation process,
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4. CASE e-L/G
Letter of Guarantee, Delivery Order ( L/G,D/O)
L/G, D/O - Problems with original papers
(lateness) Importer can not take the
cargo without original paper expectations
- Avoidance of regal problems about the delivery
process - Improvement of inconvenience dealing
agreement - Automation of complex trade process
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4. CASE DVCS
Data Validation and Certification Server (DVCS)

• DVCS service
• - Validate the contents, documents
• - Include CRLs(directory), OCSP, TSA core PKI
  Infra
• Main functions
• - CPD Certification of Possession of Data
• - CCPD Certification of Claim of Possession
  of Data
• - VSD Validation of Digitally Signed Document
• - VPKC Validation of Public Key Certificates
• Standard
• - IETF RFC 3029 Internet X509 PKI Data
  Validation Certification Server

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Building up Electronic Highway of the Region

• Infrastructure for the Seamless e-Trade in Asia

• Birth 2000 Oct.
• 8 Nationwide Trade Network Companies in Asian
  region joined to built Global Online Super
  Highway for B2B e-Commerce

• PAA members

• Business KTNET(Korea), CIECC(China),
  Tradelink(Hong Kong), TradeVan(Taiwan),
  CimsonLogic(Singapore), TEDI(Japan),
  DagangNet(Malaysia) and TEDMEV(Macau)
• Certification TradeSign(for KTNET),
  DigiSign(for TradeLink), TaiCA(for TradeVan),
  IDSafe(for CrimsonLogic), JetsCA(for TEDI),
  TrustGate(for DagangNet)

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The expected economical effect of PAA
Trade Volume of PAA 575.5 Bil.(Yr. 2000)
Activation of Trade within PAA

• Provision of Information Infrastructure for PAA
• Increase of Transaction Customer Satisfaction

225.3 Bil.
Korea
Japan
China
Market Size of Paperless Trading 60 Bil. /
yr.
51.2 Bil.
117.1 Bil.
Hong Kong

• About 10 of General Administration Cost in
  Import/Export

54.5 Bil.
Taiwan
80.3 Bil.
Direct Effect Save 6 Bil./yr. Within PAA
Members
Malaysia
47.1 Bil.
Singapore
Indirect Effect Tremendous Increase
Productivity, Value Save Inventory, Labor Cost,
etc
Trade Volume in 2000 2001(Source IMF, 2001)
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Features of PAA

• Features of PAA

• Regular Steering Committee Meeting (4 times/year)
• 5 Working Groups
• Cross Border Transaction Service, Mutual
  Recognition of PKI, Portal (Traders Directory),
  Cargo Tracking, Financial Fulfillment
• ebXML Standard for Common Framework

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Korea-Japan Paperless Trade Project

• History

• 2000. 9 Adoption Paperless Trade in the
  Korea-Japan summit meeting

• 2000.10 Korea-Japan government meeting for
  Korea-Japan e-Trade
• Network project (MOCIE, METI)

• 2002. 3 Completion of electronic
  document(I/V,P/L,B/L info) Transmission
• test for the 1st project
  between end-users

• 2002.11 1st Public and private Joint meeting
  for Korea-Japan paperless trade

• 2003. 3 2nd Public and private Joint meeting
  for Korea-Japan paperless trade

• 2003. 4 Real trade electronic documents
  transaction (I/V, P/L, B/L advice,
• Mill P/L) based on ebXML
  standard

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Pilot for Korea-Japan Paperless Trade Project

• Pilot User Hyundai Motors

• 4 electronic documents Invoice, Packing List,
  Bill of Lading Advice, Mill P/L have been
  standardized and transferred successfully in Feb,
  2003
• 4 documents are scheduled to be transferred for
  real transaction of pressed coil from April 1st,
  2003 between Hyundai Motor and Mitsubishi Corp.
• For safety of transaction, Secure channel and
  Digital Certificate are applied

Hyundai Document Format
Mitsubishi Document Format
KTNET
TEDI
PAA Standard
Hyundai Motor
Mitsubishi Corp.
I/V, P/L B/L adv, Mill P/L
Translation
Translation
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HMC Bosch Pilot Project-Before
Manual Transaction
Automation
1. P/O via Fax
2. P/O key punching
Import Dept.
RBKR
RBDM
RBKR
RBDM
4. I/V via Fax
3. Printing I/V
5. Shipping Request
8. Payment Request
7. B/L via Fax
6. B/L via Fax
Finance Dept.
9. Payment Request
10. Payment
BADEN-WURTTEMBERGISCHE BANK
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HMC Bosch Pilot Project-After
Manual Transaction
Automation
4. Order Approval
Import Dept.
RBKR
RBDM
RBKR
RBDM
3. P/O key punching
11. eB/L(info.)
5. I/V (EDI)
7. Shipping Request
12. Payment Request
2. P/O(EDI)
6. I/V(EDI)
Finance Dept.
1. P/O(EDI)
8. eB/L(Info.)
15. Deposit
9. eB/L(Info.)
10. eB/L confirm
13. Payment Request
14. Payment
BADEN-WURTTEMBERGISCHE BANK
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Expansion Service and Participants
Korea
Germany
Real Transaction ( Invoic, Dispatch Notice )
GMCC
Forwarder
Messaging Center
Repository Center
Europe
Korea
BADEN-WURTTEMBERGISCHE BANK
Delphi
More than 20 Companies By 2004
BANK

• To Develop Docs

SIEMENS

• P/O
• Shipping Information
• Shipping Order
• Shipment Notice
• B/L Information
• Settlement Information
• Air Waybill

• Developed Docs

• Invoic
• Dispatch Notice

BERU
Expansion
INA
Invoic Invoice Packing List
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E-Trade HUB in ASIA KTNET !
Building Trust in your Business TradeSign !
Thanks You!
KTNET e-Biz Strategic division Hak-Hee Han
hhhan_at_ktnet.com 82-2-6000-2721