If anyone in the border modernization community is paying attention, you’ll know that UNCTAD and the ASYCUDA program have been busy marketing to the CARICOM Caribbean Community lately that ASYCUDA World is or can be considered an Electronic Single Window. First off, ASYCUDA World is not a Single Window by any modern measurement. More on that in minute.
This tweet has been a common message from the ASYCUDA Program representatives in the region for the past few years, and the intensity of the false marketing has recently increased to users of the system (Barbados, Trinidad, Jamaica, and more etc.) including future users of the system (Guyana). As a CARICOM based Firm, it’s painful to watch our friends continue to be swayed and played by the ASYCUDA Program.
This tweet is simply another bold statement and appears to declare that ASYCUDA not only modernizes customs procedures but can be considered a Single Window and a Trade Information Portal…and finally ensures a country is implementing the World Trade Organization’s (WTO) Trade Facilitation Agreement (TFA). Wow. That sounds almost too good to be true. And it is.
CARICOM friends be careful. The ASYCUDA program has a history of overselling ASYCUDA with functions that don’t exist. The system is old technology, rudimentary, and entry level at best. This type of marketing will resonate with presentations, and audible statements but in the end it is mostly “vaporware”. Hidden costs exist in the middleware via a SOCLASS license paid to an external shell company in Sofia, Bulgaria that even the UN Office of Internal Oversight services (OIOS) exposed as collusion and a conflict of interest.
Until a working installation exists, the community should consider the ASYCUDA Single Window Functionality as Vaporware. Vaporware is often announced months or years before its purported release, with few details about its development being released. In this type of situation, developers will intentionally promote vaporware to keep customers from switching to competing products that offer more features.
Challenge any ASYCUDA statements seeking facts and ask UNCTAD to prove to you that ASYCUDA World is a Single Window. It will be in your best interests to have them show you first hand. Do your homework on other available technologies, obtain price estimates, and ask for advice/opinions from those who work in multiple countries who have the vantage point to see and compare between Single Window options and offerings. Jut because you may run ASYCUDA today doesn’t mean you can check the box on “Single Window”. UNCTAD has created a microcosm of ASYCUDA users in the Caribbean, and they will only tell you what they want you to know. You won’t really get insight from your neighboring CARICOM country because they use ASYCUDA as well and have been held hostage with the same limited functions. If your local or regional insight on best practice Customs technology can be kept within a bubble, then you aren’t necessarily going to know of better options that may be available at equivalent of better pricing.
So, what’s the purpose of an Electronic Single Window?
In our view, an Electronic Single Window should improve border collaboration and decision making between Customs and all Other Government Agencies (OGAs) at the border, who have a mandate over the cross-border movement of controlled and regulated goods. The outcome should be reduced trade release times, simplification of procedures, and improved controls resulting in enhanced security and trade facilitation. To get there, you need 3 things:
1) Natural Language Processing (NLP) and Machine Learning (ML) to automate determining the Harmonized Tariff System (HTS) Number for Commodity Classification.
2) A sub system (trade data management system) that allows for the determination, application, approval and management of digitized licenses, permits, certificates, and other control documents (LPCOs).
3) Case and Workflow management systems to automate decision making between Traders, Customs, and the OGAs.
In short, a leading-edge Single Window should work like this:
A well designed Single WIndow should reduce trade release times from days to hours.
An importer, broker, or agent (the trader) signs onto the SW as a user and completes their import declaration (CUSDEC) or Single Administrative Document (SAD). The trader can use NLP to automatically define the right commodity classification code for the goods being imported. Based on the HTS selected, the system should know immediately whether the goods are controlled, regulated, or prohibited. If regulated or controlled, the system should prompt for the entry of the correct digitized LPCO(s) from the appropriate OGA(s). The system should also utilize previous importatoins and system profiles to minimize data entry for new LPCO(s). Ultimately the trader completes any new LPCO applications needed, alongside the import declaration and submits all for decisions. The declaration goes to Customs for calculation of duties and taxes owed (which can be ASYCUDA), and the LPCO goes onto a worklist for the various OGA analysts to review, deny, approve, seek payment, or ask for more information.
Once an LPCO is approved, it is appended to the import declaration (e.g. SAD in ASYCUDA) and will automatically notify Customs that the LPCO has been approved. Pending payment of duties and taxes or any other Customs controls, the shipment can then be cleared to enter the economy of the country. The result is a reduction in release times from days to hours, improved trade facilitation, and ultimately economic growth in the country and region.
Here’s how the ASYCUDA program thinks a Single Window should work:
The Importer or broker/agent completes a SAD for filing in ASYCUDA. The Trader may be familiar with the commodity and may recognize an LPCO will be required. If not, -or if the trader attempts to import a controlled or regulated commodity without an LPCO, it’s up to the Customs officer reviewing the SAD to stop and demand the appropriate LPCO to accompany the import package. If the commodity is tainted meat, a lot of people could become sick. If the commodity is “Dimethyl Methylphosphonate” then it’s a chemical weapons pre-cursor that could cause serious damage. If the commodity is under domestic production controls, its entry could lead to costly recalls, hardship for local businesses and lost revenue.
ASYCUDA currently requires a human to identify and ensure the proper controls are put in place per the mission and mandate of the OGA at the border. Does that sound safe to you? I hope not my CARICOM friends, because it isn’t, especially if those high-risk commodities enter your country without LPCO controls in place.
The OGAs are reliant on Customs as the face at the border to do this activity for them. For those commodities identified as requiring an LPCO (meat, dairy, plants, animals, chemicals, weapons, ammunition, etc.), the Trader is required to travel all over the city (or country) to obtain a “paper” LPCO to append to the import declaration with Customs. This task alone can take several days. If many controlled commodities are in the shipment or container, then the trader is required to visit many OGAs to receive approved LPCOs, some of whcih may even require multiple OGA office visits. It is no wonder why the trade release times in CARICOM nations exceed several days to import a commercial shipment.
(Source: UNCTAD From E-Customs to Single Window)
For many years, Customs would simply hold the paper document on file in the port, while the import declaration resided in ASYCUDA electronically. As self declared trade experts, UNCTAD thinks they’ve solved the problem in a way to declare ASYCUDA World as a Single Window. Their version of a Single Window takes the paper permit and allows a scanned attachment to be appended to the SAD as a release package. Not leading edge, but it does link the documentation. While this provides a convenience for Customs officers, it has never yet lead to improved release times or trade facilitation. It is a partial measure that addresses a symptom but not the underlying problem. Why? Because the trader is still travelling all-over the city or country obtaining the same paper based LPCO. If it takes 8 days on average to clear goods into a Caribbean country, the ASYCUDA solution still takes….well 8 days. No Single Window Here.
If you enjoy the "ASYCUDA Myth", please give a thumbs up. Thank you all for your continued support. Here are links to the earlier articles:
Stay tuned for more disruption and the next blog in our series, “the ASYCUDA Myth” Part 6.
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