Abbreviations and Acronyms

ACCESS Automated Custom Clearance System

APEC Asia Pacific Economic Cooperation

ARTNET Asia – Pacific Research and Training Network on Trade

CAA Civil Aviation Authority

CARE Customs Administrative Reform

CB Capacity Building

CMR Convention on Contracts for International Carriage of Goods by Road

CODEX Alimentarius

CSI Container Security Initiative

C-TPAT Customs – Trade Partnership Against Terrorism

DPP Department of Plant Protection

EASY Electronic Assessment System

ECO Economic Cooperation Organization

FBR Federal Board of Revenue

EDF Export Development Fund

EDI Electronic Data Interchange

EDIFACT Electronic Data Interchange for Administration, Commerce and Transport

FIATA International Federation of Freight Forwarders Association

GAP Goods Agriculture Practices

GATT General Agreement on Trade and Tariffs

GCI Growth Competitiveness Index

HACCP Hazard Analysis and Critical Control Points

IATA International Air Transport Association

ICC-Pakistan International Chamber of Commerce – Pakistan national Committee

INTRA Integrated Regulatory Authorities

ISO International Organization for Standardization

ISPS CODE International Ships and Port Facility Security Code

IT Information Technology

KICT Karachi International Container Terminal

MFD Marine Fisheries Department

MINFA Ministry of Food, Agriculture and Livestock

MRL Maximum Residue Limits

NTCIP National Trade Corridor Implementation Program

NTFS National Trade Facilitation Strategy

NTTFC National Trade and Transport Facilitation Committee

PaCCS Pakistan Customs Computerized System

PACCS Pakistan Customs Community based Computerized System

PAKET Pakistan Electronic Trade

PHDEB Pakistan Horticulture Development and Export Board

PICT Pakistan International Container Terminal

PIFFA Pakistan International Freight Forwarders Association

PSI Pre-Shipment Inspection

QICT Qasim International Container Terminal

RKC Revised Koyoto Convention

SOLAS Safety of Life at Sea

SPS Sanitary and Phytosanitary

TARIP Tariff and Integrated Policy

TDAP Trade development Authority of Pakistan

TDED Trade Data Element Directory

TFFA Transit Transport Framework Agreement

TIR International Transport of Goods

TRS Time Release Study

TTA Transit Trade Agreement

TTFP Trade and Transport Facilitation Project

UN/CEFACT United Nations Centre for Trade Facilitation and Electronic Business

UNCTAD United Nations Conference on Trade and Development

UNECE United Nations Economic Commission for Europe

UNeDocs United Nations electronic Documents for Trade

UNESCAP United Nations economic and Social Commission for Asia and the Pacific

UNLK United Nations Layout Key

UNTDED United Nations Trade Data Elements Directory

WCO World Customs Organization

WEF World Economic Forum

WTO World Trade Organization

Executive Summary

With the developments in WTO and globalization of trade, trade facilitation has become an important tool for improving the competitive edge of a country in the international market place. Completion of all transaction requirements for the international supply chain to achieve just-in-time delivery within the shortest possible lead time and at the least cost of doing business requires adoption of trade facilitation measures with cooperation and coordination of all the concerned parties, and appropriate measures have to be adopted to remain in the competitive international market.

There are differing definitions of trade facilitation. However, a broader understanding of trade facilitation includes any procedure, process or policy capable of reducing transaction costs and facilitating the flow of goods in international trade. Trade facilitation in this wider sense can affect a wide range of activities such as import or export procedures, transportation formalities, logistics services, payment, insurance and other financial requirements.

WTO has defined the trade facilitation requirements in GATT Articles V, VIII and X. WCO has developed Conventions, standards and recommendations relating to harmonized systems, facilitation procedures, use of information technology, compliance and enforcement. Revised Koyoto Convention provides a foundation for modern and efficient Customs procedures and is therefore central to Customs modernization and reform. UNECE and UNCTAD have been major players in trade facilitation development for over 30 years. UN/CEFACT, which is hosted by UNECE, has already developed over 30 major trade facilitation recommendations. A major development is the introduction of Single Window facility that allows parties involved in trade and transport to lodge standardized information and documents with a single entry point to fulfill all import, export, and transit-related regulatory requirements. Chapter 3 has examined in detail the global supply chain requirements for trade facilitation, the trade facilitation measures recommended by various international organizations, the requirements for facilitation of international trade.

Pakistan is a founding member of ECO. Many member countries of ECO are landlocked. To facilitate transit trade of these countries ECO has adopted Transit Trade Framework Agreement. The ECO Member States adopted in 1997 a Programme of Action for ECO Decade of Transport and Communications (1998-2007). One of its requirements is accession to a number of international conventions. Pakistan has not yet acceded to most of these conventions. This is a major hindrance in development of transit trade through Pakistan.

9/11 caused the world to refocus on Customs control. For the purposes of supply chain security WCO introduced the Customs Guidelines of Advance Cargo Information and SAFE Framework of Standards which provides guidelines on integrated border management through a single window to coordinate border agencies. US Homeland Security Department introduced a number of programs such as CSI, 24 Hour Rule and C-TPAT to secure the supply chain of goods entering US through ocean going sea containers. Chapter 4 explains the trade and border security measures that are now being adopted internationally

In Pakistan the trade facilitation activity commenced in August 2001 with establishment of NTTFC and initiation of work on a World Bank funded Trade and Transport Facilitation Project (TTFP) with technical assistance of UNCTAD. During the intervening period activities of NTTFC have mainly related to:

Study of international trade transaction procedures
Harmonization of important trade documents with UNLK
Coordination with Pakistan Customs in implementation of the Goods Declaration and PaCCS
Supporting the concerned organizations in implementation of border security measures
Modernization of transport and marine insurance legislations
Providing advice on implementation of international conventions
Study of sanitary and phytosanitary controls
Study of capacity requirements and policies needed for refrigerated domestic transport and cold storage of fresh produce
Study of requirements for PACCS (PAKET) Network
Studies relating to logistics costs and shipping charges
Modernization of freight forwarders by introducing standard trading conditions, minimum standards of professional qualifications and the code of conduct
Providing training to support trade facilitation

International trade processes used in Pakistan are still predominantly manual. With introduction of internet the use of email for commercial transactions is on the increase. But in the absence of internationally standardized trade documents which could be authenticated with digital signature and necessary infrastructure for converting paper documents to electronic documents the email messages do not meet the requirements of international e-Commerce.

Since initiation of CARE in 2002 the Customs services in Pakistan are going through a major transformation from a completely paper based environment to web based paper free environment. PACCS has been introduced in container terminals and is to be rolled out to all other Customs stations. However, the scope of PACCS needs to be widened in to a community based Single Window

The Bills to introduce or modernize some transport related legislation are still going through the administrative processes.

Some important issues relating to implementation of SPS standards for exports and SPS controls on imports need to be addressed.

Many international conventions need to be acceded to facilitate transit trade.

Human resource development needs to be addressed and suitable training arranged.

The present status of trade facilitation in Pakistan has been discussed in detail in chapter 5 and the measures that need to be adopted have been identified. After taking in consideration the international developments and the situation in Pakistan the National Trade facilitation Strategy has been evolved and presented in chapter 6. An Action Plan indicating the deadlines for executing various strategy objectives is presented in chapter 7.

3. Trade Facilitation

3.1 Definition and Objectives

Trade facilitation is an important issue as it helps countries to enhance and sustain their trade competitiveness. This is because:

• Exports will be efficient and cost-effective;

• Imports of raw materials for the manufacturing sector will be less costly;

• Small and medium-sized enterprises will be able to participate in international trade as the country’s trade regulations and procedures become easier; and

• Increased trade flows will result in more foreign exchange earnings[6]

The term 'Trade Facilitation' has been defined in multiple ways by different organizations and trade agreements. For example, in the context of the WTO and the Organization of Economic Cooperation and Development (OECD) trade facilitation means:

“The simplification and harmonization of international trade procedures including the activities, practices and formalities involved in collecting, presenting, communicating and processing data and other information required for the movement of goods in international trade”[7]

This definition excludes non-tariff barriers to trade, such as sanitary and phytosanitary measures, or measures to protect social or environmental standards. The current WTO negotiations on trade facilitation are limited to the improving and clarifying of the General Agreement on Trade and Tariff (GATT) Articles V (Freedom of Transit), VIII (Fees and Formalities connected with Importation and Exportation), and X (Publication and Administration of Trade Regulations).

By comparison many bilateral and regional trade agreements have a broader understanding of trade facilitation, and include any procedure, process or policy capable of reducing transaction costs and facilitating the flow of goods in international trade. Trade facilitation in this wider sense can affect a wide range of activities such as import or export procedures, transportation formalities, logistics services, payment, insurance and other financial requirements. However, trade facilitation even in its wider sense is generally distinguished from tariff negotiations and the development of physical infrastructure for trade (such as ports, roads, railways), that also influence the flow of traded goods.[8]

United Nations Economic Commission for Europe (UNECE) has elaborated on the definition of trade facilitation as follows[9]:

“Trade facilitation, then, is a comprehensive and integrated approach to reducing the complexity and cost of trade transaction process and ensuring that all these activities take place in efficient, transparent and predictable manner, based on internationally accepted norms, standards and best practices. At the same, time it seeks to optimize the effectiveness of regulatory controls to ensure the safety and well-being of citizens and the collection of appropriate taxes and fees. Trade facilitation therefore involves primarily:

· Simplifying (and eliminating where possible) formalities and procedures. In particular those related to import, export and transit of goods;

· Harmonizing applicable laws and procedures;

· Improving and standardizing physical infrastructure and facilities, including transport and Customs facilities; and

· Standardizing and integrating information definitions and requirements and the use of information and communication technologies so as to exchange this information efficiently.”

3.2 APEC Principles

The Asia Pacific Economic Cooperation (APEC) has maintained trade facilitation on its agenda since mid-1990s. APEC trade ministers adopted at their 2001 Shanghai meeting the following nine trade facilitation principles for trade of goods and services[10]:

· Transparency,

· Communication and consultation,

· Simplification, practicability and efficiency,

· Non-discrimination,

· Consistency and predictability,

· Harmonization, standardization and recognition,

· Modernization and the use of new technology,

· Due process, and

· Cooperation

3.3 WTO - GATT Articles V, VIII & X

Reduction of trade barriers such as tariffs and quantitative restrictions has raised the profile of reducing the transaction costs, especially at the border crossings; and the logistics costs for the goods in transit. WTO – GATT Articles V, VIII and X relate to trade facilitation issues. Ministers from the 150 countries member countries of WTO decided, in December 2005 at the Ministerial Conference in Hong Kong, to start negotiations drafting the text of a WTO trade facilitation agreement.

GATT Article V addresses matters related to goods in transit, including nondiscrimination of transit goods, disciplines on fees and charges, disciplines on transit formalities and documentation requirements, and improved coordination and cooperation amongst authorities and with the private sector.

The following categories of measures fall under Articles VIII, X or both: publication and availability of information; time period between publication and implementation; consultation and commenting on new or amended rules; advance ruling; appeal procedures; advance lodgment of data; fees and charges connected with importation and exportation; border agency coordination; release and clearance of goods; tariff classification.

3.4 WCO Revised Koyoto Convention

WCO has been striving to achieve the balance between trade facilitation and compliance with statutory requirements. The efforts of WCO are focused at simplifying and standardizing Customs practices across its Member administrations. The organization has developed Conventions, standards and recommendations relating to harmonized systems, facilitation procedures, use of information technology, compliance and enforcement through which its Member Customs administrations offer their governments enhanced trade facilitation combined with effective Customs control.

Developments in WTO negotiations; increased globalization of trade; and growth in e-commerce and use of EDI have raised prospects for paperless Customs clearance environment and electronic exchange of trade related information. The simplification and harmonization of Customs procedures is therefore important to the liberalization of international trade. International Convention on the Simplification and Harmonization of Customs Procedure as amended by 1999 Protocol – Revised Koyoto Convention (RKC) provides a foundation for modern and efficient Customs procedures and is therefore central to Customs modernization and reform.

RKC is designed to help Contracting Parties achieve a modern Customs administration, improved facilitation and control with simpler, harmonized and more flexible approach. RKC is formulated to contribute to international trade by[11]:

Developing uniform Customs practice and procedure around the world;
Meeting the needs of international trade and Customs for facilitation, through simplification of Customs procedures and practices;
Ensuring appropriate standards of Customs control;
Enabling Customs to respond to major changes in business and administrative methods and techniques; and
Reducing the costs to traders and to Governments of Customs processing.

RKC is in three parts – the Body, the General Annex and the Specific Annexes. The Body is obligatory. The General Annex is also obligatory. It contains core principles which are not repeated in the Specific Annexes. The ten Specific Annexes, which cover different aspects of Customs procedures, are not obligatory. The Specific Annexes contain both Standards and Recommended Practices.

The revision has incorporated important modern concepts, including the application of new technology (particularly the use of IT for electronic transactions), the implementation of new philosophies on Customs control (such as risk management and post-transaction audit) and new cooperative arrangements with private sector partners. The RKC establishes best practice in key operational fields including:

· risk management;

· audit based controls;

· pre-arrival information;

· information technology;

· coordinated interventions;

· consultation with trade;

· information on Customs laws, rules and regulations;

· system of appeals in Customs matters

3.5 UNCTAD and UNECE Recommendations

UNECE and UNCTAD have been major players in trade facilitation development for over 30 years. The United Nations Centre for Trade Facilitation and Electronic Business (UN/CEFACT), which is hosted by UNECE, has already developed over 30 major trade facilitation recommendations[12]. Recommendation No. 1, United Nations Layout Key for Trade documents and the Recommendation No 2, Location of Codes in Trade Documents established the basis for use of standardized paper documents in international trade and transport.

Recommendation No. 4, National Trade Facilitation Organs recommends that Government establish and support trade facilitation bodies with balanced private and public sector participation in order to identify issues affecting the cost and efficiency of their country’s international trade; develop measures to reduce the cost and improve the efficiency of international trade; assist in implementation of those measures; provide a national focal point for collection and dissemination of information on best practices in international trade facilitation; and participate in international efforts to improve trade facilitation and efficiency.

Many other recommendations establishing internationally standardized codes for various names and terms used in international trade and transport and developments in the use of IT led the way for adoption of recommendation No. 25, Use of the United Nations Electronic Data Interchange for Administration, Commerce and Transport (UN/EDIFACT). Developments in the use of internet as a convenient and efficient mean for data transfer and communication resulted in recommendations 31 and 32 recommending need for development of self-regulatory instruments and voluntary code of conduct for electronic business to support development of international trade.

Recommendation No. 33, Recommendation and Guidelines Establishing a Single Window aims at enhancing efficient exchange of information between trade and government through a single window facility that allows parties involved in international trade and transport to lodge standardized information and documents with a single entry point to fulfill all, import, export and transit-related regulatory requirements.

UNCEFAT in collaboration with International Organization for Standardization (ISO) has produced Trade Data Elements Directory (TDED) to facilitate an open interchange of data in international trade. These standard data elements can be used with any method of data interchange on paper documents as well as with other means of data processing and communication: they can be selected for transmission one by one, or used with particular system of interchange rules.

UNCEFACT is at present working on United Nations electronic Trade Documents (UNeDocs) project. The objectives of this project is to develop, publish and maintain a Business Standard which can be applied by countries, regions or industries to provide the definitions of contextualized data exchange documents which can be integrated into software solutions for traders, carriers, freight forwarders, agents, banks, Customs and other Governmental authorities etc. This Business Standard will include paper and electronic document structures which have been derived from the UNeDocs canonical data model. Derivation from this canonical data model ensures that each UNeDocs paper or electronic document specification is an individual implementation of a document development methodology which follows the aligned concepts described in UNECE Recommendation 1, the UN Layout Key (UNLK). This ensures that traders can choose the type of document technology that best meets their business requirements and technology capabilities and also provides a migration path for the adoption of new technologies[13].

3.6 UNESCAP Trade Facilitation Framework

In 2004 UNESCAP published a document titled “ESCAP Trade Facilitation Framework – a Guiding Tool”[14]. The purpose of this guide is to provide a guide for Governments to identify the problems and bottlenecks within a country’s trade facilitation system and to identify remedial action. The framework is aimed at addressing possible issues and impediments in the following areas:

· Trade and Customs laws and regulations

· Trade documentation

· Customs clearance procedures

· Trade and customs enforcement

· The use of ICT for trade facilitation

· Trade finance infrastructure development

While the framework is intended for use in improving the trade facilitation system, the systematic process used to identify problems and solutions is also readily applicable to improvement of transport facilitation processes, and would be effective if applied to an integrated trade and transport facilitation system.

Diagrammatic Representation of Trade Facilitation Framework

3.7 ECO TTA, TTFA and Plan of Action

ECO is an intergovernmental regional organization constituting Islamic State of Afghanistan, Azerbaijan Republic, Islamic Republic of Iran, Republic of Kazakhstan, Kyrgyz Republic, Islamic Republic of Pakistan, Republic of Tajikistan, Republic of Turkey, Turkmenistan and Republic of Uzbekistan. Most of the Member countries are landlocked. To facilitate trade and transport of these countries ECO has adopted Transit Trade Agreement (TTA) and Transit Transport Framework Agreement (TTFA). These agreements have been ratified by most of its Members and have come in force[15]. However, implementation of the agreements is being delayed because many of the international conventions requiring ratification/accession by its Members have not yet been acceded by them.

The ECO Member States adopted in 1997 a Programme of Action for ECO Decade of Transport and Communications (1998-2007). One of the requirements of this Plan of Action is accession to the following international conventions:

Convention on Road Traffic (1968)
Convention on Road Signs and Signals (1968)
Customs Convention on the International Transport of Goods under cover of TIR Carnet (1975)
Customs Convention on the Temporary Importation of Commercial Road Vehicles (1956)
Customs Convention on Containers (1972)
International Convention on the Harmonization of Frontier Control of Goods (1982)
Convention on the Contract for International Carriage of Goods by Road (CMR) (1956) New York Convention on Transit Trade of Landlocked States of 8 July 1965
Barcelona Convention and Statute on Freedom of Transit of 20 April 1921
Agreement concerning the adoption of Uniform Conditions of Approval and Reciprocal Recognition of Motor Vehicle Equipments and parts of 20 March 1958
Convention on Civil Liabilities for Damage caused during Carriage of Dangerous Goods by Road, Rail and Inland Navigation Vessels (CRTD) of 10 October 1989
Agreement on the International Carriage of Perishable Food Stuffs and on the special Equipment to be used for such Carriage (ATP) of 1 September 1970
Convention relating to the Unification of Certain Rules concerning Collision in Inland Navigation of 15 March 1960
Convention on the Contract of the International Carriage of Passengers and Luggage by Inland Waterways (CVN) of 6 February 1976

3.8 IATA e-Freight Project

International Air Transport Association (IATA) represents 260 airlines around the world and is embarked on an e-freight project to simplify the business process for reducing the cost and improving the efficiency in airline industry. Under this initiative it has adopted a strategy to eliminate the need to produce and transport paper documents for air cargo shipments by moving to a more simple, industry-wide, electronic, paper-free environment.

The scope of e-freight is focused on Paper Free, which has been defined as an environment in which industry does not need to transport paper in parallel with the freight, but grants stakeholders the ability to print out e-documents on paper using the same physical layout if needed. To support a fully paper free freight environment the business, technical, legal and legislative frameworks must be in place for all stakeholders in the supply chain to enable seamlessly exchange of e-documents without the need to transport paper.

The system for implementation of e-freight strategy has to be developed in such a way that the industry and individual stakeholders can interface with the World Customs Organization framework of standards being implemented in each Customs administration to support the single window concept.

The stakeholders implementing e-freight strategy have three steps to deliver paper free for their industry:

E-document framework and standard layout and message format definition and adoption;
System connectivity and capability to send/receive messages and print e-documents; and
Country adoption of e-document framework

In order to support a paper free environment, the industry must in all cases develop robust procedures to supply electronic data to the required level of completeness and accuracy as demanded by customs administrations and other supply chain partners.

3.9 Single Window

A Single Window is a facility that allows parties involved in trade and transport to lodge standardized information and documents with a single entry point to fulfill all import, export, and transit-related regulatory requirements1. If information is electronic, then individual data elements should only be submitted once. The Single Window is a practical application of trade facilitation concepts intended to reduce non-tariff trade barriers and deliver immediate benefits to all members of the trading community.

A Single Window facility enhances the availability and handling of information, and simplifies and expedites information flows between trade and government. It also brings about greater harmonization and better sharing of the relevant data across governmental systems, bringing meaningful gains to all parties involved in cross-border trade. It results in improved efficiency and effectiveness of official controls and reduces costs both for Governments and for traders due to better use of resources.

There is no unique model for a Single Window, as operators adopt their systems to specific national/regional conditions and requirements. There are examples of financing provided by the State, by the private sector or with a help of a private-public partnership. In some countries use of Single Window facilities is compulsory, while in others it is voluntary. Services vary and may be provided free of charge or based on various payment schemes. The benefits and revenues generally outweigh the establishment/operational costs[16].

Global Trade Single Window[17]

3.10 Time Release Study

TRS is one of WCO’s most important trade facilitation instrument, based on similar initiatives in the USA and Japan where it was developed and adopted by the Permanent Technical Committee of the WCO in 1994. It is one of the methods used to review clearance procedures by measuring the average time taken between the arrival of goods and their release. This enables customs to identify problem areas in the clearance process and potential corrective action to increase efficiency.

Modern Customs administrations have recognized that streamlining and simplifying clearance procedures is important in order to meet facilitation expectations of the modern business environment of just in time production. Business benefits a great deal from predictable release of goods.

The WCO’s Time Release Study is primarily designed to measure the time required to clear goods for home use. This may strictly be from the time of arrival of goods in the Customs territory until their release to the importer or a third party on behalf, or until the full clearance has been granted by Customs after payment of duties and taxes[18].

3.11 Model Trade Facilitation Measures

The Member countries have forwarded their proposals for negotiating the WTO Trade Facilitation Agreement. WTO has produced Compilation of Members’ Proposals relating to WTO Negotiations on Trade Facilitation[19]. Based on these proposals and proposed APEC model measures the following list of key model trade facilitation measures has been drawn from the ARTNET Working Paper “A Comparative Analysis of Trade Facilitation in Selected Regional and Bilateral Trade Agreements[20]”.

1) Publish trade regulations

"To publish in at least one of the official WTO languages all relevant laws, regulations, administrative guidelines, rulings and decisions affecting international trade, including custom procedures, fees and charges to cross-border trade, by making this information widely available and easily accessible (where possible on- line) in a non-discriminatory fashion to any interested party at no cost or at a minimal charge commensurate with the cost of the services rendered."

2) Ensure dissemination of information relevant to trade

I) "To notify to other countries and the WTO Secretariat in one of the official WTO languages the introduction of new or the amendment of existing trade regulations that may have a significant impact on trade at the earliest78 possible stage."

ii) "To allow an adequate time period between the publication and the implementation or entry into force of new or amended regulations, except in cases where advance notice is precluded or not practical due to extraordinary circumstances like imminent threats to national security."

iii) "To establish a national enquiry point responsible for providing all relevant trade-related information or documents to the trading community on a non-discriminatory basis and within an adequate time period"

3) Provide advance rulings in Customs matters

"To issue upon written request by an applicant with justifiable cause (e.g. importer, exporter or producer) and containing all relevant facts and supporting documents a binding advance ruling on the main elements of importation, such as tariff classification, Customs valuation, applicable duties and taxes."

4) Establish a mechanism to review decisions

"To establish non-discriminatory procedures for administrative and legal appeal against Customs and other agency decisions at reasonable cost. The appellant should have the right to be represented at all stages of appeal procedures by an agent or a lawyer and goods subject of an appeal should normally be released provided an adequate guarantee for duty payment, such as a deposit, is provided by the appellant."

5) Apply trade regulations consistently and in a non-discriminatory manner, and guarantee due process

i) "To develop, implement and enforce a code of conduct for Customs officials and staff based on international best practice"

ii) "To establish a centralized government body in charge of interpreting and providing training in the application of Customs regulations (e.g. regarding Customs classification and valuation)."

iii) "To introduce computerized systems to reduce the discretion exercised by Customs officials and staff with respect to basic Customs decisions."

6) Minimize/reduce fees and charges in connection with import or export

i) "To consolidate, reduce and minimize the number, diversity and amount of fees and charges in connection with importation and exportation."

ii) "To ensure that fees and charges are only imposed for services provided in direct connection with the specific importation or exportation in question"

iii) "To ensure that fees and charges do not exceed the approximate costs of the services provided and are not calculated on an ad valorem basis."

7) Establish a 'Single Window' / one-time submission procedure

"To establish a 'Single Window' allowing the one-time electronic or paper based submission of import or export data and documentation requirements."

8) Implement pre-arrival examination

"To introduce procedures for filing and examining documents prior to the arrival of goods, enabling the importers to claim their goods immediately after importation unless the goods are subject to a physical examination80 or the submitted documents have to be reviewed."

9) Implement post-clearance audit

"To introduce procedures that allow customs authorities to first release all or most of the imported goods, and then conduct a thorough review of the documents regarding selected goods."

10) Application of risk management techniques:

"To conduct examinations and inspections of goods by using established risk assessment and risk management procedures82, in particular by classifying importers/ exporters into different risk levels based on their compliance record and by simplifying formalities for authorized traders."

11) Elimination of Pre-Shipment Inspection (PSI) and use of Customs Brokers

i) "To eliminate any requirement for the mandatory use of pre-shipment inspections."

ii) "To eliminate any requirement for the mandatory use of customs brokers."

12) Simplify and reduce customs procedures and documentary requirements:

i) "To simplify and reduce the incidence and complexity of import and export formalities and data requirement to the necessary minimum to enforce legitimate policy objectives by the using international standards to the extent possible."

ii) "To try to agree on a minimum number of documents required for import and export."

13) Simplify procedures for goods in transit:

"To simplify and reduce formalities, documentation requirements, fees and charges85 and controls of goods in transit to a minimum necessary to ensure national security and health by applying international standards and by promoting bilateral and regional transit agreements."

14) Use harmonized tariff classification

"To apply objective criteria for tariff classification of good by adopting the WCO Harmonized Commodity Description and Coding System (HS Convention 2002/2007)."

15) Align national standards with or adopt international standards:

"To align national standards with or adopt internationally established standards for quality management and product safety to the extent practicable".

16) Recognize standards of other countries:

"To recognize based on mutual recognition agreements product standards and/or classifications of other countries"

17) Recognize certification and testing facilities of other countries or international organizations:

"To recognize based on mutual recognition agreements the certification bodies and test facilities of other countries and/or international organizations and to recognize goods approved by such bodies as compliant with safety and quality requirements without further testing."

18) Prior consultation on new and amended rules

"To provide interested parties including the private sector with an opportunity to comment on prospective new or amended trade-related laws and regulations before implementation or entry into force of the changes."

19) Ensure cooperation and effective exchange of information between custom authorities

i) "To provide for compatible import/ export data requirement and data processing systems."

ii) To converge official controls in a 'one-stop shop' to the extent possible for instance by alignment of working hours and the development of common Customs facilities."

20) Improve mobility of Business People

"To enhance the mobility of business people engaged in the conduct of trade by facilitating temporary business entry and establishing streamlined immigration clearance procedures for highly qualified business people."

21) Use of automation and automated systems for Customs cargo processing

"To establish a mechanism and as far as possible automated system that facilitates cooperation between Customs authorities by exchanging specific information such as Customs valuation, tariff classification, accurate description, quantity and origin of goods etc. and - where appropriate - supporting documentation such as commercial invoice, packing list, certificate of origin etc."

22) Use of electronic communication (e-customs, submission of documents, payment of duties)

Country	GCI 2006 rank	GCI 2005 rank	GCI 2004 rank
China	54	48	46
India	43	45	55
Sri Lanka	79	80	73
Pakistan	91	94	91
Bangladesh	99	98	102

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