The Global Express Association represents the three leading express delivery carriers: DHL, FedEx and UPS. Serving clients of all sizes in 220 countries and territories, express delivery has become one of the key conveyor belts of international trade. GEA’s members pick up, transport and deliver over forty million shipments every day, of which well over a million are international shipments of goods (as opposed to documents). Theirs is a door-to-door integrated service that combines surface and air transport seamlessly, and provides fast Customs clearance. It has become part of the business model of many of its customers.

To provide this sophisticated level of service, express delivery carriers have invested heavily in their own networks. Together, GEA members operate around 1,500 airplanes (owned or leased), and a fleet of around 300,000 ground vehicles – from e-bikes to heavy trucks, and of course, delivery vans, which are perhaps their most visible symbol around the world.

In addition, express delivery carriers have pioneered the use of advance electronic information. Alongside the fast physical flow of small parcels that defines the express business, there is a parallel flow of data associated with each shipment. This is key for internal management purposes, to track-and-trace each shipment and, where possible, to accelerate the clearance of express parcels through Customs.

All the investments that express delivery carriers constantly make to improve their network give them firm administrative and physical control over the parcels. Shipments tend to stay in an express carrier’s network throughout their journey. Track-and-trace capability allows carriers and their clients to monitor the progress of a parcel from pick-up to delivery. Clients appreciate the speed, reliability and security associated with this particular way of conveying goods and documents.

But, at the same time, all these means and technology do not give express carriers control over border clearance processes. Here, a partnership with Customs and border agencies, based on mutual trust, is key to making sure that, where shipments do not present any particular risk, these processes happen as fast as possible. Or, at least, in a predictable manner.

Some customers may value predictability over speed. It is sometimes more important to know that compliant shipments – say, an important component – will be delivered at a factory’s doorstep at a precise, recurrent time, than to know that, for the most part, many of them will be delivered very fast (and others perhaps less so). Although, of course, that matters, too.  For others, speed is paramount.  Ask an airline or a shipping company that urgently needs a spare part for one of its planes or ships, stranded thousands of miles away from a hub or port of call.

This is precisely the reason why GEA started collecting information, over a decade ago, on Customs capabilities worldtrillwide for its members. It was important to gauge how efficient – or inefficient – border processes were in a given country and territory. In turn, this would allow GEA members to gauge the speed and reliability with which parcels would be cleared at the border.

Trade facilitation matters, and not only to express carriers or their clients. The World Trade Organization’s own estimates “show that the full implementation of the TFA could reduce trade costs by an average of 14.3% and boost global trade by up to USD1 trillion per year, with the biggest gains in the poorest countries”[1].

Country managers for the three carriers, as well as regional express associations, are asked to measure a list of key performance indicators defined by GEA’s members. The results were initially listed in a series of country (or, as the case may be, territory) profiles, and made available on the association’s website. Over time, the profiles were turned into a searchable database and also published online.

With the advent of the World Trade Organization’s Trade Facilitation Agreement, and the evolution of trade itself, GEA realized two years ago that the time had come for a thorough review of the database itself. The association thus embarked on a reformulation of the questionnaire that feeds the database, with two aims in mind.

Firstly, to review the relevance of some of the key performance indicators measured.

Secondly, to align the questionnaire as far as possible with the existing international instruments on Customs efficiency: the TFA, mentioned above, and the World Customs Organization’s Revised Kyoto Convention and Immediate Release Guidelines.

This new database was launched earlier this year. Like its predecessor, it is publicly available on the association’s website (www.global-express.org). Before describing it in more detail, there are four important caveats worth mentioning.

Firstly, GEA’s objective is not to rank countries or point fingers at anyone. Rather, it wants to offer a contribution to the discussion on improving trade facilitation and on the level of implementation of the most important international treaties on this matter.

Secondly, the database reflects the point of view of express delivery carriers. As mentioned earlier, express delivery is a very specific business model when it comes to logistics. Do not expect to find information about border processes or clearance delays at seaports, or railway entry points. Express carriers do not use them.

Thirdly, it reflects GEA members’ own practical experience. The database is fed with first-hand information collected from the three express companies’ country managers. Occasionally, there have been discrepancies between what a Customs Code may provide for, and how it is practically implemented (or not) at the border. In such (rare) cases, the database reflects the carriers’ experience.

And last but not least, GEA makes it abundantly clear that the information on its database cannot be considered, under any circumstances, to be official Customs information. While the industry makes a constant effort to keep it as current as possible, not all the information in the database may always be up-to-date. Where users of the database come up with observations or even corrections, we do take them into consideration.

The key performance indicators that the database measures are structured into three main themes: Transparency and Predictability; Customs Efficiency; and Post-Release Processes. Two additional sections record a country or territory’s standing in the WTO Trade Facilitation Agreement and the WCO Revised Kyoto Convention. For example, are they parties to them and, if so, since when?

The Transparency and Predictability section features a list of six questions, which in some cases include sub-questions. They refer to the publication of laws, regulations and procedures; the ability to comment on changes; and restrictions that may affect express delivery clearance, such as weight and value thresholds.

The Customs Efficiency section lists 13 questions and their sub-questions. They focus on issues such as formalities; the ability to process electronic information and carry out automated risk assessments; opening hours; typical release times for the various categories of shipments under the Immediate Release Guidelines taxonomy; and the acceptance of electronic documents and scanned copies of physical ones, etc.

This section also contains information on the existence (or not) of two important thresholds: de minimis thresholds under which no tax or duty is collected; and informal entry thresholds under which border formalities are simplified for dutiable shipments.

It is worth pausing here for a moment to mention that the Customs capability database is the most visited page on GEA’s website, with several hundred visitors a month – not bad, for something that remains quite a technical subject, after all. And of all the information on the database, de minimis thresholds repeatedly make it to the top of the popularity podium. GEA’s dataset on de minimis has been quoted in many academic papers and is also frequently sought by traders large and small, even if, as explained above, it cannot be considered official Customs information. This may serve as an indication of the importance of some processes for e-commerce[2]. So much so, that one of the new features launched with the revised database is an interface that automatically generates a table of de minimis thresholds at the touch of a button, based on the latest information available.

Lastly, the Post-Release Processes section is arguably shorter, with four questions and sub-questions. They focus on the availability and timing of administrative and judiciary appeals; valuation techniques; and processes associated with the seizure of shipments that infringe intellectual property rights.

The database provides various interfaces to retrieve the wealth of information it contains.

First, it allows users to view and print the traditional country (or territory) profiles, in which all information available is presented in one go.

But beyond this, it also allows users to search specific information by keying in a word. If you type “electronic” into the search box, all questions containing that word will be listed, such as, for instance, “Does Customs or any other agency accept electronic supporting documents?” The user can then select up to three listed questions, and either ask the system to provide all answers for 119 countries and territories, or narrow them down by means of a drop-down menu. For instance, selecting “yes” in the case of the question above would yield a list of countries and territories that do accept such documents.

The third option is a world map associated with a drop-down menu that lists all questions on the database. By pulling down the menu and selecting a question from it, the map will show, in colour-coded patterns, the different answers, country by country (or territory). For instance, if the user selects that same question on electronic documents, a map will show where they are or are not accepted, or where we do not have relevant data. Importantly, we have added remarks to fine-tune the answers given. For instance, a “no” may be associated with an explanation such as “Originals must be submitted with entries”. Placing the cursor on the specific country or territory on the map will produce a pop-up window with the name of the country and territory and any comments or remarks linked to the answer.

It is GEA’s intention to update the information on the database as it becomes available, so that it stays as up-to-date as possible. In addition, it will launch yearly reviews to ask the three carriers’ country managers to pore through their country or territory profile and report any changes. It is a time-consuming effort that demands additional attention from colleagues who are already very busy doing their daily jobs. Inconsistencies or inaccuracies are therefore inevitable, but the association strives to control the quality of the information as thoroughly as possible.

GEA invites all WCO Members to take a look at their profile on the database. We may not always be right, or up-to-date. And occasionally, we might disagree on a matter of interpretation. But it is our intention to enter into dialogue with countries so that this tool is highly accurate. In the end, our common aim is to have border processes that are as efficient as possible, so that countries are connected to global supply chains and their export industries remain highly competitive, to the benefit of authorities, businesses and consumers alike.

More information
www.global-express.org

[1] https://www.wto.org/english/tratop_e/tradfa_e/tradfa_e.htm

[2] GEA considers that de minimis thresholds are an important tool for facilitating low-value shipments typically generated by online transactions. But it has also made a proposal on how the collection of revenue for dutiable low-value shipments could be simplified in a way that would benefit authorities, small traders and carriers alike. Details are available at www.global-express.org.