The contribution of the TIR System to the security of trade and transport

Speech by Martin Marmy
Secretary General of the International Road Transport Union (IRU)

THE CONTRIBUTION OF THE TIR SYSTEM TO THE SECURITY OF TRADE AND TRANSPORT
Budapest, 1-2 February, 2007

(Slide 1) Distinguished Chair!

Dear Friends,

Ladies and gentlemen!

On behalf of 180 associations from 70 countries representing all variety of road transport, I would like to thank you for the opportunity to intervene at this WCO Regional Conference. Since 1948, the IRU has been the implementing partner of the TIR transit system based on the UN TIR Convention. For many years the IRU has worked in close collaboration with the customs administration and with the UNECE in order to develop the TIR system to ensure that it meets the changing needs of both the private and public partners who use this important facilitation tool. Today the TIR system is unique in that it facilitates the secure and efficient transport of goods traded between the 55 countries where the system is currently in operation.

Allow me to start by highlighting the fact that the WCO challenges presented yesterday by your Chairman Mr Erling are the same as those of our industry. This is why I am particularly pleased in the name of the private sector to contribute to our common goal.

(Slide 2)

Those of you who attended the WCO Regional Conference in Baku in February last year may remember that I presented briefly on that occasion the IRU’s security guidelines for managers, drivers and shippers/client. I explained in particular how these guidelines, which are based on WCO standards, permit any fleet operator using the TIR procedure to meet all the new requirements to secure and facilitate global trade.

(Slide 3)

Now the WCO standards, under the SAFE Framework, are recognised by customs administrations in 139 countries. As a consequence, the existing legislation focus on three main issues:

Authorized Economic Operators

Advanced cargo information

Risk Management.

(Slide 4)

The practical implementation of such concepts presents the WCO with two major challenges: the mutual recognition of the AEO status and the platforms of communication whereby Customs administrations can verify the particulars and authenticity of AEOs at international borders or inland Customs offices.

These two challenges were also challenges for the TIR System. Indeed, safe and secure trade and transport have been for almost 60 years the cornerstone of the TIR System. Controlled access, mutual recognition of the AEO, advanced cargo information and efficient risk management are essential aspects for a secure facilitation tool such as the TIR system.

The TIR System has successfully managed to address the challenges of mutual recognition and effective communication. But before I explain how these challenges have been met in TIR, in order to demonstrate how TIR and the SAFE requirements are similar, let me explain how the TIR System achieves the objectives of controlled access, advanced cargo information and risk management.

(Slide 5)

Firstly, according to the TIR Convention the access to use the TIR System is strictly controlled jointly by the public authorities and by the private sector. All 40,000 transport companies operating about 250,000 trucks currently authorized by their national customs authorities, as well as by their national road transport association have been duly checked and tested for their:

Proven experience in international transport

Sound financial standing

Absence of offences against Customs or tax legislation

Exclusive use of secure vehicles or containers and load compartments

Due to the effectiveness of this selection criteria, the IRU – through its network of national associations – is able to deliver over 3 million TIR carnets per year. This represents the issuance every day of a major amount of financial guarantee for the TIR fleet operators in 55 countries. The magnitude of the financial amount delivered every day by the international guarantee chain managed by the IRU demonstrates clearly that the risk management as well as the very selective process and criteria in place to authorise transport companies to use the TIR system is very effective.

(Slide 6)

In the WCO SAFE framework, the Authorized Economic Operator (AEO) is one of the pillars of the risk management of the Public-Private Partnership. The criteria just mentioned for access to the TIR system, which have proved their effectiveness for almost 60 years, are essentially the same as the criteria to obtain the authorisation as AEO.

(Slide 7)

Secondly, all the road vehicles currently used for the 3 million TIR transports taking place every year have all been technically approved. Indeed at the start of any TIR transport, the vehicle is sealed and the vehicle is designed in such a way that nothing can be introduced or removed from the load compartment without breaking the seals. In addition the quality and method of fixing the seals are constantly improving through, for example, the use of technically sophisticated sealing devices. The implementation of the electronic seal for ISO maritime containers – which incidentally are all also approved according to the technical specifications of the TIR Convention – is not far away.

(Slide 8)

Thirdly, following a recommendation of the UN TIR bodies an electronic control system for use of TIR Carnets was introduced 12 years ago as part of improving the risk management of the TIR system. The control system, also called SAFE TIR, introduced as Annex 10 of the TIR Convention, was developed in a true and effective Public-Private Partnership, in cooperation with the national Customs authorities and the road transport industry.

The international IT network necessary to ensure the transmission of data is at the core of the Safe TIR control system. This system enables all customs authorities to be fully informed about a particular TIR transport, including its termination, as well as the name of the holder of the TIR document and the validity date of each specific TIR Carnet.

Let me also inform you that in a fruitful partnership between the Russian Federal Customs Service (RF FCS), IRU and the Russian road transport association ASMAP, the Safe TIR control system has recently been dramatically enhanced. This system currently provides the customs authorities and any other authorised control administration with all the requested data about any TIR transport in Russia in real time.

Without any problems the same real time Safe TIR control system could be expanded to any Road or Container transport under the TIR system and to any country.

(Slide 9)

Finally the IRU fully agrees with the WCO SAFE Standard: the “pre-notification” to the customs authorities of any transport vehicle with the goods conveyed, also called “summary declarations” or “advanced cargo information” are important tools for the customs to improve the security of trade.

In this respect the IRU has developed in cooperation with several national customs administrations another IT tool enabling any TIR transport operator to provide the required data based on the contents of the TIR Carnet and the CMR consignment note, electronically in advance to the customs or any authorised control administration. The electronic declaration matches both the demands of the TIR Convention and the demand of the EU electronic transit system.

It is also worthwhile to note that the Safe TIR coupled with the application ensuring the advance NCTS/TIR cargo information can be used for ISO maritime container transports. Now, let me come back to the two current challenges faced not only by the WCO, but also by the road transport industry, the mutual recognition of AEOs and the need for efficient communication platforms.

As mentioned earlier, the status of authorized TIR transport operator is essentially based on the same criteria as those necessary to obtain the status of AEO according to the SAFE Framework.

TIR transport operators are recognized in the 55 countries where the TIR system is operational. The controls made in the country where the TIR operator is established, as well as the certificates of approval issued for the vehicles and the seals applied by the Customs offices of departure are accepted by all other Customs offices during the TIR transit operation within the 55 TIR contracting parties. All this is a concrete example of the mutual recognition of the TIR procedure and control.

This is also the concrete result of the current functioning of a true and effective Public-Private Partnership between the national Association issuing TIR Carnets and the competent public authorities to ensure that all the elements for a secure transit are all present.

It is obvious that the effective mutual recognition of the Authorised Economic Operator (AEO) is dependent upon the existence of and access to a real time AEO communication platform or central database, whereby Customs administrations can verify at any time the particulars and authenticity of any AEOs.

(Slide 10)

In the TIR System such a database already exists for transport operators authorised for TIR. This database called Cute-Wise is made fully available to Customs administrations in order to facilitate and support their risk management. Therefore through this database, Customs are able to check at any time the status and validity of a specific TIR Carnet as well as the current status of a TIR transport and TIR operator.

In conclusion, the IRU, through its major financial investments for the development of the appropriate risk management and data exchange between the transport industry, the Customs authorities and the authorized control administration, has already clearly demonstrated its commitment and its readiness to offer its 60 years of expertise in 55 countries, to improve the security of the international supply chain. While everyone recognises a blue TIR plate on the truck, very few people are aware of all that has already been achieved and of what can still be achieved by the reinforcement of the current Public-Private Partnership to meet, without any duplication of the work, the WCO SAFE Framework.

This is why if we want this partnership to remain efficient and effective, we need to make sure that the SAFE Framework remains uniform and continuously provides the mutual recognition of the Authorised Economic Operator. We are therefore concerned that some Customs administrations, such as the US with their so-called “10+2” proposals, are attempting to exceed the already agreed data sets in the WCO SAFE Framework despite the previous understanding that the data elements listed in the WCO Framework would be the maximum required for security purposes.

If different Customs administrations develop different data sets for summary or advanced cargo declarations this would have a detrimental impact on trade and defeat the current objective of the WCO SAFE Framework.

While we understand that the SAFE Framework should not be considered as definitively written in stone, the road transport industry would like to receive confirmation that the Framework will not be unilaterally and arbitrarily revised in the future, but rather that any proposed modification will be subject to a deliberative, periodic review process, involving all the stakeholders including the road transport industry.

(Slide 11)

It is only by working together that we can ensure that trade and Customs authorities can achieve their common objectives to secure and facilitate trade as is currently the case under the TIR system.

Thank you for your attention!

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