International Supply Chain Security

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World Customs Journal

SUPPLY CHAIN SECURITY:
THE CUSTOMS COMMUNITY’S RESPONSE
Kunio Mikuriya

Abstract
The international customs community has developed measures to secure and facilitate global trade which have been transformed into international standards for global implementation. These standards are designed to improve customs operations through enhanced risk management that is built upon Customs-to-Customs cooperation and Customs-to-Business partnerships. The standards are supported by existing WCO instruments, including the Revised Kyoto Convention on the Simplification and Harmonization of Customs Procedures, and fulfil the requirements of enhanced security and facilitation for legitimate trade in the 21st Century global trading system. The majority of WCO Members are currently implementing these standards through the development of Authorised Economic Operator (AEO) programs, ensuring that they have the capacity to do so by requesting appropriate capacity building assistance.

Introduction
As is often pointed out, the role of Customs has evolved over time from its original revenue collection function to one that encompasses a range of missions at national borders. The basic function for customs officers remains essentially the same however, as they control the cross-border movement of goods and examine accompanying documents. Through this border control function, Customs plays a role in protecting society from the inflow and outflow of prohibited or controlled goods that pose a threat to the health and safety of nationals, such as drug trafficking. Meanwhile, there is growing recognition that Customs plays an important role in promoting economic prosperity by facilitating international trade. Therefore, it is imperative for Customs to maintain effective and efficient control without hindering the smooth flow of legitimate trade. To improve border control whilst discharging a variety of responsibilities, the international customs community has developed a range of standards and best practices. They recommend the maximum use of information technology and the adoption of risk management and other modern techniques, which are embodied in the Revised Kyoto Convention1 and other WCO instruments. Moreover, the WCO has made every effort to promote international cooperation and provide technical assistance and capacity building to its members in need of help to implement its standards.

Following the terrorist attacks that occurred on September 11, 2001 in the United States, there was a heightened recognition that the global trading system is vulnerable to possible exploitation by terrorists and organised crime. Located on the borders and knowing those involved in international trade, Customs was expected by the international community to contribute to enhancing the security of global trade. The new mission of security has shifted the focus of Customs from its traditional ‘place of import’ to encompass the entire trade supply chain that covers the movement of goods from origin to destination. It has also heightened the awareness of the need to enhance cooperation among customs administrations to cover the global supply chain. On the other hand, while supporting the enhanced security measures, the trade community expressed a concern over possible setbacks for trade facilitation efforts. In response, Customs perceived the need to enhance partnerships with compliant businesses in strengthening the security of the supply chain while preserving facilitation for legitimate trade. Volume 1, Number 2

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International Network of Customs Universities
This article reviews the development of the WCO standards on supply chain security and the WCO’s efforts to promote their implementation effectively. In 2002, in response to the new challenges, the international customs community embarked on an initiative to develop security measures, through the WCO Task Force, in close consultation with business and relevant international...
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