Maritime transport carries 90 percent of global merchandise trade[1], and impediments to ports’ logistical chains have tangible repercussions in terms of higher trade costs and even shortages of goods and materials. The chains include numerous entities, spanning shipping lines, carrier agents, terminal operators, freight forwarders, road haulage operators, train operators, Port State Control, as well as Customs administrations and other regulatory authorities.

Port authorities, be they government or private, play a key role in ensuring coordination between this large number of players which may have divergent – sometimes even opposing – interests, but are dependent to some degree on the activities and actions of others in the chain. On the one hand, ports must implement the law enforcement measures imposed by cross-border regulatory agencies; on the other, they have to avoid obstructing businesses in terms of costs and cargo clearance times.

When a ship comes into port, a whole range of administrative tasks begin, including but not limited to: Customs declarations for cargo and ships’ stores; immigration clearance for crew and passengers and their baggage; import and export permits. When the ship leaves, it is the same process all over again. These activities are regulated by an international treaty called the International Convention on Facilitation of International Maritime Traffic (FAL Convention).

There are international requirements for governments to use electronic information exchange in this process. Since April 2019, the transmission of information required in respect of the arrival, stay and departure of ships in ports and harbours must take place via Electronic Data Interchange (EDI) according to the provisions of the FAL Convention. Following the adoption of amendments to the Convention, from 1 January 2024 the use of a Maritime Single Window (MSW) will be mandatory in ports around the world. The MSW is a collaboration platform which enables the submission of standardized and harmonized information to a single entry point. It covers maritime regulatory procedures, but could be extended to include other administrative, nautical and operational procedures, as well as other related information between private-sector and public authorities in ports, in relation to the vessel clearance process and the Port Call process.

In some cases, digital platforms have been developed to manage the data flows. However, in several countries, ship-to-shore reporting and Customs clearance processes are cumbersome and inefficient as they rely on paper transactions (forms, documentation and certificates), human interaction, email, and applications such as WhatsApp.

Back in June 2020, in the middle of the global pandemic, the International Association of Ports and Harbors (IAPH) led a joint industry call to accelerate digitalization in the maritime transport chain. This non-governmental organization (NGO) had conducted a survey on the implementation status of the IMO requirements regarding Electronic Data Interchange (EDI). The majority of the 111 respondents had declared that they were struggling to comply with the requirements.

As Customs play a pivotal role in the clearance processes in ports, in 2022 the WCO and the IAPH set up a joint working group to address a number of challenges in establishing cooperation between Customs and Port Authorities, especially with a view to digitalizing data flows. This resulted in the development of Guidelines on Cooperation between Customs and Port Authorities.

The Guidelines provide a path towards strengthening cooperation, and explain how to institutionalize cooperation, establish data governance policy and ensure mutual understanding of each other’s business. They also describe business processes, the IT systems supporting them and the actors involved, as well as addressing the innovative use of technologies. They then look at how to implement interoperability between Customs’ and ports’ automated systems to enable the single submission of logistic and operational data sets, highlighting the need to comply with WCO and IMO reference data models.

It is worth noting here that the WCO Data Model is aligned with the IMO Compendium on Facilitation and Electronic Business (IMO FAL Compendium), which is a tool for use by software developers who design the systems needed to support transmission, receipt and response, via electronic data exchange, of information required for the arrival, stay and departure of a ship, persons and cargo in a port. The components of the WCO Data Model are organized into small building blocks called Information Packages (IP), and the work done with the IMO resulted in the development of the IMO FAL Derived Information Package (DIP). In addition, practical guidance on implementing the IMO FAL Compendium using the WCO DM has been developed and published, including a Message Implementation Guide which provides additional technical information for implementers.

The Guidelines also recommend that Customs and ports create a joint data strategy, and explain how the strategy should be implemented. Finally, detailed explanations are provided on how to align the Customs Authorized Economic Operator and ISPS Code security programmes, and on the digital transmission of Advance Cargo Information.

The Guidelines will hopefully stimulate a dialogue among Port and Customs authorities and move the digitalization agenda forward. For this edition of the Magazine, we have looked at the port environment from different angles.

We start with an article by the Abu Dhabi Customs Administration and Ports Group, introducing the various digital initiatives these two entities have been driving jointly in recent years to improve operations and efficiency in Customs processes at ports. These initiatives include participating in the development of a digital platform which brings together more than 800 IT services developed by 70 public- and private-sector entities. The platform provides trade operators with a single IT ecosystem that encapsulates everything they need in terms of administrative procedures.

Our second article takes us to Bulgaria and the Port of Varna. The Bulgarian Customs Administration explains the risk analysis model applied by the Customs office in charge of the port, referring also to the various digital platforms employed by the administration and, finally, some of the challenges that frontline Customs officers have to deal with. “If a thorough and streamlined risk management model is in place and control measures are efficiently performed, digitalization can result in creating Smart Borders”, concludes the author.

We then delve into more technical issues, with an article by a service supplier arguing that integrating Ports’ and Customs’ information systems in a Cloud environment is a game changer for digital transformation. The article also points out that in order to choose between on-premises and Cloud infrastructure, several factors must be taken into account such as trade volume, IT budget, data sovereignty and growth aspirations in the medium to long term.

The next article, by the Georgia Ports Authority Customer Service Center, explains how the Authority has fostered a trusted partnership with U.S. Customs and Border Protection (USCBP). Among other things, the Customer Service Center has created a specialized, Customs-focused team to assist port customers with release/entry inquiries. It has also set up, in the Port of Savannah which operates its own terminals, a space for Customs inspections as well as a Government Services team which works hand-in-hand with the USCBP’s Centralized Examination Station and the port customers to help expedite cargo flow.

An article by the Maritime Anti-Corruption Network (MACN) then looks at the impact of corruption in ports and introduces the anti-corruption measures adopted by the Nigerian Government following several years of engagement with multiple actors from the government, business and civil society sectors. The article shows that it is possible to address systemic corruption when building strong alliances between the public and private sectors.

The final article in the Dossier presents WCO Operation Tin Can – the first enforcement activity conducted with the active involvement of the shipping industry to combat the contamination of legitimate cargo with drugs through the rip-on/rip-off method. This method requires traffickers to work with “insiders” who use their authorized access, willingly or under coercion, to manage the logistics process. This article explains how Operation Tin Can opened up new horizons in terms of enhancing the capacity of Customs to fight drug smuggling, especially through enhanced cooperation with shipping lines and the use of various technologies.

One common theme runs through these articles: cooperation. In the complex environment of maritime trade, efforts to enhance operations and deploy technologies require solid cooperation. Ports and their stakeholders can support the role and responsibilities of Customs and vice- versa. I hope the articles in this Dossier will inspire Customs administrations to look at the relevance and possibility of engaging in new or deeper relationships with these actors.

[1] See IMO https://www.imo.org