Pioneering Paperless Trade:

1
Less and Better Data to build Trust and Efficiency

• Pioneering Paperless Trade
• The way covered and the way ahead
• Experience of Innovative Compliance
  in Supply Chain Security
• UN/CEFACT Executive Forum
• Geneva , 20-21st June 2005

2
Who we are and what we do

• Integrated Risk and Regulatory data management
  services for the International Transportation
  industry
• US Intermodal Dangerous Goods Data Management
  (DOT)
• US Air Cargo Security (TSA)
• EU Air Cargo Security (DG-TREN - Study)

3
Background/Business Drivers

• Lack of mutual recognition of supply chain
  security procedures and processes
• within the EU
• between the EU, USA and other jurisdictions
• Industry must register with, and report very
  similar compliance data to, more than one
  Appropriate Authority
• Carrot stick approach to compliance

4
Accreditation by many Competent Authorities

• Accreditation of Participants in the
  International Supply Chain
• IATA Cargo Agent
• US Indirect Air Carrier
• EU Regulated Agent Accreditation
• EU Authorized Economic Operator Accreditation
• ..

5
Differing Shipment Validation Requirements

• Per-Shipment Risk Evaluation
• US CBP Load/No Load Decision
• EU Pilot Confirmation
• US TSA Freight Assessment
• EU AEO Pre-Clearance
• Targeted Inspection/Screening
• Customs - US CBP EU Administrations
• Aviation - Shipment Inspections

6
Project Phases and Evolution

• Voluntary pilot study of industry/regulator
  procedures to enable mutual recognition
• Prototyping of data interchange
• between transportation industry regulators
• with transportation security authorities in other
  jurisdictions
• with EU customs administration
• Future Trends EU wide and multimodal
  implications

7
Services and User Community

• Web Service to validate and exchange information
  on actors and actions taken to render cargo
  secure
• On line web access
• XML data exchange between Industry Regulators
• User Community
• Regulatory authorities in pilot EU Member States
• Participants in the EU Transportation Industry
• Industry/Government Study Group

8
The Business Model

• Lead taken by DG-TREN in Brussels
• Government funded Pilot to evaluate
• Feasibility ( policies, data collection, risk
  analysis, etc)
• Costs
• Potential for Private/Public Partnership
• Users motivated to participate through
• Ability to influence future mandatory
  requirements
• Trade facilitation benefits (initially EU US)

9
Financing Development and Maintenance

• Direct Cost Justification
• Cost of inspection/screening
• Facilitation delays
• Loss of business
• System development operation could be financed
  by usage fees from
• Government
• Industry
• Other stakeholders

10
Standards and Interoperability

• Data Standards
• Unique Shipment Reference Number
• Unique Corporate Name/IDs
• Evolving Regulatory Standards
• Risk management paradigms
• Cross administration security procedures
• IT Standards selected to support
• Interoperability
• Maintainability
• Data security

11
What are the Benefits?

• Pilot will investigate
• Feasibility of integrating security procedures
  within the business processes of industry and
  regulatory participants to achieve
• For Industry
• Reduced processing costs
• Enhanced risk management
• Increased trade facilitation
• For the Public at Large
• Safety for the traveling public and transport
  employees
• Government
• Better utilization of scarce regulatory resources

12
Key Trends that support a Single Window approach

• Security is already an integral component of most
  trade facilitation processes
• Competent Authorities have recognized the need
  for one stop compliance and the seamless
  integration of regulatory processes
• Mutual recognition relies on (secure) data on
  actions taken to render cargo secure

13
Crucial Success Factors

• Success factors
• Joint Government/Industry participation in the
  regulatory process
• Simple, elegant and industry acceptable
  technological solutions
• Limiting Factors
• Political Leadership
• Industry fears
• Lack of agreed standards

14
To integrate security with paperless trade we
need to..

• Establish standards to permit the definition and
  one time capture of all data elements required
• Obtain government support for one stop security
  accreditation and mutual recognition across
  Administrations and National boundaries
• Deliver UN funding to develop and validate
  International Standards

15
Thank you

• Support_at_euaircargo.com