Alternative Sea Cargo Reporting

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• Alternative Sea Cargo Reporting
• Business Case Development
• Project Approach
• Version 2.2
• Prepared by Cargo Projects Team, 22 February 2007

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This project has been established to develop a
costed business case for the possible
introduction of an alternative sea cargo
reporting regime, based on the US and WCO models
for pre-load cargo reporting
In the latter half of 2006, a joint team of
industry (AFIF, CBFCA and SAL) and Customs
representatives developed a preferred model for
future sea cargo reporting, based on the US
pre-load reporting model. The Cargo Processing
Steering Committee (CPESC), chaired by Customs
CEO, considered the model in December 2006 and
has authorised further work to establish a
business case and define economic impacts if the
model were to proceed to implementation. This
will include further work over the next six
months to scope and cost the required
legislative, systems and process changes.
This document outlines how the business case
will be developed, including core principles,
deliverables, schedule and co-development working
arrangements between industry and Customs. It
should be read in conjunction with the
Alternative Cargo Reporting Feasibility Study,
developed by the project team in 2006 for the
CPESC.
The Project Brief is the formally approved
document for this project. This Project Approach
document is a summary of the Project Brief
designed for broader distribution to industry and
Customs working groups.
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The following principles should be used to guide
development of the ACR business case
All work products are to be jointly developed
with industry and Customs an open and
collaborative environment is essential
We are developing a business case it needs to
be an impartial assessment of benefits, costs and
risks. A decision on whether to adopt the
Alternative Sea Cargo Reporting Model has not
been made and will be informed by this business
case
The business case only needs sufficient detail
for the executive to make an informed decision,
supported by industry. Only issues that have a
major impact on industry or government support,
costs, risks or benefits need to be resolved for
the business case.
We will develop and release key concepts early
details can be fleshed out later, once we have
support from stakeholders for the major elements
We will take a pragmatic approach before a purist
or theoretical approach to the model to ensure
widespread industry support
All models must support the statement of
direction and benefits contained in the original
Feasibility Study
The determinant of our success will be the
quality of the questions we ask
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There are four major streams of work involved in
the development of the ACR Business Case to
enable a well-informed decision to be made on
whether or not to proceed with an implementation
of an Alternative Model. All streams require
consistent stakeholder engagement, project
management and governance
Investigation and analysis

• Data Element Review
• Detailed review of US elements structure
• Mapping of Customs/AQIS requirements to US SCR to
  identify unique requirements
• Analysis of Aust data quality requirements and
  current US model data quality
• Use of bay plan within Customs

• Overseas Compliance Models
• Implementation lessons learned
• Effectiveness of compliance regime on report
  timeliness and data quality
• Proposed EU and UK models
• Operational model costs, effectiveness
  limitations (targeting, enforcement, facilitation
  etc)

• US Safe Port Act Assessment
• High level conceptual model
• Opportunities for 102 to improve proposed
  pre-load model
• High level assessment of impacts, benefits,
  issues and risks associated with model

• Business Process Assessment
• Understanding the detailed business processes
  associated with cargo movements and reporting
  (process mapping)
• Understanding process changes across the range of
  scenarios affected by ACR

Model Development

• Data Model
• Definition of new Sea Cargo Report
• Modifications (if any) to Import Declaration
• Modifications (if any) to proposed ACP Request
  for Cargo Release
• Modifications (if any) to SACs and/or UPE
• Agreed message format (ANSI/EDIFACT)
• Bay plan transmission (when/who etc)

• Status Service Level
• Agreed service levels with industry across a
  range of scenarios
• Impact of the service level on Customs
  operations and industry
• Implications of not meeting service level

• Operational Model
• Industry practices carriers, brokers etc
• Customs practices cargo ops, targeting,
  compliance, enforcement, CISC
• Impact of split models across cargo types
• Resource requirements (staff, premises, support
  services etc)
• Business continuity plan

• Technical Architecture
• ICS (inc CCF), CRE and FRAM system and database
  changes required
• Supporting infrastructure
• Impact on industry software developers
• Impact on air cargo reports and processes
• Changes to interfaces (AQIS etc)
• Impact on historical data

• Compliance Model
• Compliance outcomes required (timeliness, data
  quality, management overhead, information
  requirements)
• Penalty and incentive regime
• Impact on other programs (ACP, AEO etc)
• Required legislation
• Impact on other freight types (air etc)

Implementation Planning

• Implementation Plan
• High level business transformation plan
• High level schedule
• Resource requirements for implementation
• Supporting resource requirements for operations
  (staff, premises etc)

• Costing Model
• Implementation costs
• Transitional costs
• Operational costs
• Non-financial (or measurable) impacts
• Customs costs considered in this deliverable

• Risk Model
• High level risks associated with implementation
  and ongoing operations
• High level risks associated with changing global
  environment (US Safe Port Act, EU pre-load
  legislation, security events etc)

• Transition Arrangements
• Agreed transition arrangements timing (port,
  country, region, carrier?)
• Transitional compliance model, including
  legislation
• Transitional operations model (industry/ACS)
• Transitional systems model

Business Case Development

• Economic Impact Assessment
• Defining benefits and costs to Australian
  industry of the preferred model
• Defining winners and losers in the model
• Impact on other freight types (air, post etc)
• Industry costs considered in this deliverable

• Final Report
• Summary document, including recommendations as to
  whether or not to proceed and next steps

• Border Security Assessment
• Analysing the impact of the preferred model on
  Australias border security

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The business case development requires
significant input and resources from other
Branches within Customs. Branches with delivery
responsibility for a task have been identified
accordingly. Separate Statements of Work
providing more details on workstreams and branch
and industry involvement have been prepared.
Investigation and analysis

• Data Element Review
• Cargo Strategic Development (delivery)
• Cargo Operations (reporting policy)
• Cargo IEUS
• Compliance
• Targeting
• Enforcement and Investigations
• Applications and Information Management

• Overseas Compliance Models
• Cargo Strategic Development (delivery)
• Cargo Operations
• Compliance

• US Safe Port Act Assessment
• Cargo Strategic Development (delivery)
• Views from other branches will be sought

• Business Process Assessment
• Cargo Program Management (delivery)
• Cargo Strategic Development
• Targeting
• Compliance
• Cargo Operations
• Cargo IEUS

Model Development

• Data Model
• Cargo Strategic Development (delivery)
• Cargo Operations
• Cargo IEUS
• Targeting
• Applications
• Information Management

• Status Service Level
• Cargo Strategic Development (delivery)
• Targeting
• Cargo Operations
• Cargo IEUS

• Operational Model
• Cargo Strategic Development (delivery)
• Targeting
• Cargo Operations
• Cargo IEUS
• Compliance
• Applications

• Technical Architecture
• Applications (delivery)
• Cargo Strategic Development

• Compliance Model
• Compliance (delivery)
• Customs Legal Unit
• Cargo Strategic Development
• Cargo Operations (reporting policy)
• Cargo IEUS

Implementation Planning

• Implementation Plan
• Cargo Program Management (delivery)
• Cargo Branches (Strat Dev, Ops, IEUS)
• Applications
• Targeting and Intel Strategic Development
• Compliance

• Costing Model
• Cargo Program Management (delivery)
• Cargo Strategic Development
• Applications

• Risk Model
• Cargo Program Management (delivery)
• Cargo Branches (Strat Dev, Ops, IEUS)
• Targeting and Intel Strategic Development
• Compliance
• Applications

• Transition Arrangements
• Cargo IEUS (delivery)
• Cargo Branches (Strat Dev, Prog Mgt, Ops)
• Compliance
• Applications
• Targeting and Intel Strategic Development

Project Support Provided Throughout Project by
Cargo Program Management Branch
ICS Business Intelligence/Data Analysis Provided
Throughout Project by Applications Branch
Business Case Development

• Economic Impact Assessment
• Cargo Strategic Development (delivery)
• Outsourced consultancy
• Cargo IEUS (providing data)
• Applications (providing data)

• Final Report
• Cargo Strategic Development (delivery)

• Border Security Assessment
• Cargo Strategic Development (delivery)
• Outsourced consultancy??
• Intelligence Targeting Division
• Enforcement Investigations Division

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The business case development will also require
significant input and resources from industry and
other agencies All workstreams will be reviewed
by the Working Group. Significant input has been
anticipated from industry in the following areas.
Separate Statements of Work providing more
details on workstreams and branch and industry
involvement have been prepared.
Investigation and analysis

• Data Element Review
• Negligible resources required from industry
• AQIS (minor input)

• Overseas Compliance Models
• Negligible resources required from industry

• US Safe Port Act Assessment
• Views from industry and AQIS will be sought

• Business Process Assessment
• All parties to provide input and review

Model Development

• Data Model
• SAL (major input)
• CBFCA (major input)
• AFIF (major input)
• AQIS (minor input)

• Status Service Level
• AFIF (major input)
• CBFCA (major input)
• Stevedores (minor input)

• Operational Model
• All parties to provide input and review

• Technical Architecture
• SAL (minor input)
• CBFCA and AFIF (minor input)
• Software developers (minor input)
• Stevedores (minor input)
• AQIS (minor input)

• Compliance Model
• SAL (major input)
• CBFCA (major input)
• AFIF (major input)
• Stevedores (minor input)

Implementation Planning

• Implementation Plan
• SAL (major input)
• CBFCA (major input)
• AFIF (major input)
• Stevedores (minor input)
• Software developers (minor input)
• AQIS (minor input)

• Costing Model
• Negligible resources required from industry

• Risk Model
• All parties to provide input and review

• Transition Arrangements
• SAL (major input)
• CBFCA (major input)
• AFIF (major input)
• Stevedores (minor input)
• Software developers (minor input)
• AQIS (minor input)

Business Case Development

• Economic Impact Assessment
• All parties (including ACCi members) to provide
  significant input (data to the consultancy)
• Possible input from other agencies may be
  required (DFAT, DITR, Treasury etc)

• Final Report
• All parties to provide input and review

• Border Security Assessment
• Negligible resources required from industry
• Other security agencies may require input

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This indicative schedule shows most activities
running in parallel to achieve an August
reporting timeframe. Further time compression
would risk a quality outcome, given current
resource constraints. Two major checkpoints have
been introduced to manage the projects major
risks (refer risk register later in this
document).
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The project governance and operational model will
involve management and oversight across industry
and Customs

• Cargo Processing Executive Steering Committee
• Customs Executive Officers
• SAL Michael Phillips (Chairman)
• AFIF Fritz Heinzmann (Chairman)
• CBFCA Bob Wallace (Chairman)
• CAPEC Jeff Fairburn (Director)
• ACCI John Collins (senior representative)
• Meets quarterly to review significant progress
  and issues (such as data element and 102
  decisions). Approves business case at conclusion
  of project.

Trade Facilitation Program Board

• Project Program Board
• Snr Executive Chair Jane Bailey (ND, Cargo
  Div)
• Cargo Strat. Dev. David Leonard ( NM)
• Cargo Operations Matthew Corkhill (NM)
• Cargo Program Mgt Craig Langford (NM)
• Cargo IE US Jo Corcoran (NM)
• Compliance Sharon Nyakuengama (ND)
• Targeting John Valastro (NM)
• Applications Michelle Kinnane (NM)
• Meets monthly to approve workstream deliverables
  and project progress. Escalation point for
  internal and industry issue resolution

Program Governance Oversight
Customs Project Sponsor David Leonard National
Manager Cargo Strategic Development Branch

• Customs Working Group
• Targeting Julie Doensen (Director)
• Compliance Shane Davie (Director)
• Applications John Mostovoy (Director)
• Cargo Operations Bruce Smith (Director)
• Cargo PM Dane Cupit (Director)
• Cargo IEUS Steve Moore (Director)
• Naa Opoku (Director)
• Meets weekly to review workstream progress and
  manage inter-dependencies and issues. Members of
  the Working Group will also be leading or
  assisting with the development of the various
  models

• Industry Working Group
• SAL Alan Brundish (GM Cosco Shipping)
• Alan McDermid (GM Border Agencies)
• CBFCA David Katte (Director BCR Freight)
• Paul Zalai (Mgr Freight Bus
  Ops)
• AFIF Brian Lovell (CEO)
• Stevedores Adrian Sandrin (GM Ports IT,
  Patricks)
• Mark Dolan (Optimisation Mgr DP World)
• AQIS Lee Cale (Manager Electronic Systems)
• Meets fortnightly or monthly to progress
  workstream deliverables and approve items before
  progressing to CPESC

Customs Project Team Additional staff
member required for oversight of Economic Impact
Assessment

• Customs Regional Advisory Group
• Stephen Pearce (Victoria)
• Michel Cafun (Queensland)
• Peter Stankiewicz (NSW)
• Meets monthly to provide regional operational
  input to the model development and implementation
  planning phases. Meetings may be combined with
  Customs W/G Meetings

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It is critical to get the right mix of workshop
participants in order to deliver a quality
outcome in the timeframe available to deliver the
business case. The following guidelines are
designed to assist industry associations select
the appropriate workshop participants and to
support them appropriately during the process
Customs executives may also find the above
guidelines useful in selecting participants for
the various workshops and the Customs Working
Group. In this case, the Branch leadership takes
on the equivalent role of the industry
association in supporting the workshops and
Working Groups
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Issues that cannot be resolved at the Working
Group level, and that the Project Team and/or
Working Groups believe is sufficiently important
as to affect the project outcomes, should be
escalated to the Customs Steering Committee
and/or the CPESC according to the following
process. All other issues will be resolved at
Working Group levels
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The following risks and issues apply to the
business case development.
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While this project (to develop a business case)
is unlikely to impact other projects running
within Customs, the project will need to ensure
that its proposed models are aligned with those
being developed by the following projects
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This project will specifically exclude
examination or development of the following areas

• Other transportation modes, such as air and
  postal freight
• Major changes to bulk and break bulk cargo
  reporting
• Changes to reports and processes outside of sea
  cargo reports and import declarations, except
  where required to accommodate the alternative
  cargo reporting model specifically
• Underbond Movements
• Progressive Discharge Reports
• Outturns
• Impending Arrival Reports
• Unaccompanied Personal Effects declaration
• Tactical ICS changes, except where noted in the
  original Feasibility Study Report (Version 2.0,
  December 2006)
• Targeting and Profiling systems changes, outside
  of those required to accommodate new or changed
  data elements
• Consideration of Australian exports
• This project excludes preparation and/or
  presentation of a proposal to government. It is
  anticipated that any proposal to government will
  be developed after the final business case has
  been presented to the Customs Executive and CPESC.

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Document version updates