All countries abide by a number of international non-proliferation commitments including treaties, sanctions, and informal multilateral arrangements, all of which entail certain responsibilities to prevent the dissemination of weapons of mass destruction (WMD)-related technology to unauthorized state and non-state organizations or people. Amongst these international instruments is the United Nations Security Council Resolution 1540 (UNSCR 1540) adopted in 2004 after revelations about the Abdul Qadeer Khan proliferation ring, and in the context of the post-9/11 security environment. The Resolution has come the farthest in defining a common list of what measures states must take in relation to strategic trade controls and calls for their full implementation by 2021.

As such, all countries should, therefore, have a strategic trade control (STC) system in place, which aims to manage the transfer of sensitive materials, technology or equipment that might be used in weapons systems. Some of those goods have both civil and military applications and are called dual-use goods. National laws and regulations should determine the universe of goods a country considers strategic (generally including both listed goods and a catch-all provision allowing for governmental control over unlisted goods under certain circumstances), define a licensing regime and associated offences, and establish penalties for violations. In a well-functioning STC system, traders apply for permits or licences as required, and proactively comply with trade control obligations and commerce proceeds. However, compliance with the law may not be perfect, and enforcement agencies must detect, deter, and ideally prevent non-compliance.

When it comes to enforcing STCs, Customs is generally, although not always, the main agency involved at the border. Depending on the situation of a country, determining whether traders are compliant is a challenging task, especially for dual-use goods. As Renaud Chatelus explained in an article published in a previous edition of this magazine, “Detection of chemical, biological, radiological and nuclear (CBRN) material at borders by radiation portal monitors, scanners and other detectors is relatively well known by many Customs services, but amounts to only part of it. Many controlled items are dual-use industrial and scientific equipment or material defined by technical specifications, which are to be found in technical documents rather than on detector screens.” Difficulties are particularly acute in countries that are transit or transhipment points for this trade as explained by Lithuania Customs in the October 2019 edition of the magazine.

At the 31^st Session of the WCO Enforcement Committee, in March 2012, several administrations took the floor to outline the challenges they faced in relation to enforcing STCs, and called upon the WCO Secretariat to do more to help them. As a response, a team of experts was set up under a Strategic Trade Control Enforcement (STCE) Project with the objective to develop guidance material and deliver training. An Implementation Guide[i] and a comprehensive training curriculum were developed, training sessions were organized and, in 2014, an enforcement operation, called Operation Cosmo, was conducted.

The project was soon turned into a long-term programme. More training was conducted and when Operation Cosmo 2 was run in 2018 it became the largest operation ever conducted by the WCO Secretariat with 114 countries and many international organizations participating, such as the Organization for the Prohibition of Chemical Weapons (OPCW), the International Atomic Energy Agency (IAEA), the European Commission’s Joint Research Centre, the UN Security Council’s 1540 Committee, and INTERPOL.

According to the UN, capacity building can be defined as: “…the process by which individuals, groups, organizations, and communities increase their abilities to: (1) perform core functions, solve problems, define and achieve objectives; and (2) understand and deal with their development needs in a broad context and in a sustainable manner.”[ii] It is something these organizations do themselves, not something done for them. Certainly, they may seek and obtain assistance, but capacity building must be undertaken by the organization seeking to improve capacity.

The training curriculum developed by the WCO for administrations wishing to build their capacity contains high-level briefings for senior managers on how to strengthen national STCE efforts and modules for operational personnel, covering chemical, biological, radiological, and nuclear (CBRN) material and related dual-use material and equipment. It also includes training modules on applying risk management and post clearance audit in the context of STCE.

The curriculum is designed to be modular and adaptable to the capacity building needs of an administration, and to the type of trade flows it deals with. A STCE Maturity Model helps identify specific gaps in a Customs administration’s national STCE system and suggests actionable next steps.

In most countries, Customs act in terms of national regulations that give effect to a country’s international obligations, such as a Strategic Trade Act or export control orders, which list a range of goods that are subject to an export licence or permit from another regulatory authority. However, in some countries, there is no such national legal basis for detaining and seizing goods subject to international controls. Although Customs has the power to check these goods, without specific national legislation it is often difficult to legally prove that a restriction applies to a particular shipment.

The STCE maturity level also guides the selection of suitable training modules from the curriculum. For example, training for administrations with a strong STCE foundation may focus on upskilling operational personnel, but training for administrations without established national legislation would focus first on senior-level policy makers and decision makers, the aim being for them to develop a plan for the adoption of a suitable regulation.

When assessing capacity building needs, it is also necessary to understand how a country could be involved in illicit trade in strategic goods given its trade flows. While it can be argued that all countries are likely to hold some WMD-related material, some manufacture or hold WMD and related materials, some manufacture related materials, some hold stocks of related materials, and some have substantial throughput of cargo or can act as a diversion point, and are, therefore, expected to take appropriate and effective measures to prevent their territory being used to transship WMD and related materials.

To provide a better view of the situation and originally support Operation Cosmo, a Strategic Trade Atlas[iii] was developed by the United States Department of Energy’s Argonne National Laboratory and the European Union’s Joint Research Centre. It provides a snapshot of a country’s principal imports, exports, and trading partners for goods classified under Harmonized System[iv] (HS) Headings associated with strategic goods. The WCO uses this information to tailor training and focus on goods most relevant to each country. Customs administrations can also use it to guide company selection for outreach and audit as well as for risk profile development for targeting and risk management.

The WCO Secretariat does not have the staff or resources to conduct training in all countries requesting its assistance. Instead, it relies on Accredited Customs Expert Trainers. The recruitment process is as follows: the Secretariat sends a letter to WCO members inviting them to nominate personnel matching a very specific profile to attend an accreditation workshop at the end of which participants will be told whether they can take part in a capacity building mission with an expert to finalize their accreditation.

Asked to comment on the expert recruitment process of the STCE programme, Vesna Vrachar, an accredited STCE trainer from Serbian Customs, explained that “the process is very complex and requires extensive and detailed preparation as well as hard work. The STCE curriculum is very detailed and the practical professional literature which trainers have to assimilate is comprehensive.” She also highlighted how training others actually strengthen her understanding of the issue: “during the STCE training, we try to install a dialogue with participants. Not only do they learn from us, we learn a lot from them as well. There is a real opportunity to transfer knowledge and exchange experiences in the implementation of controls.”

Another expert who is finalizing her accreditation, Leila Barrahmoun from Morocco Customs, also pointed out how much she learned during the process, saying that she realized that “a good trainer must not only be qualified, but also open-minded, patient and reassuring.”

The WCO now has well over 100 accredited and pre-accredited STCE Expert Trainers from over 50 countries. Training can currently be delivered in four languages, English, French, Spanish and Portuguese, and will be available in Arabic by the end of 2020.

The WCO Secretariat aims at ensuring gender balance in the recruitment of trainers. During its latest train-the-trainer STCE workshop, women represented more than half of the officers selected to continue on to the accreditation process. In September 2019, the balance of accredited WCO trainers was 2 males to 1 female, but over the next three years, the Secretariat hopes to move towards a gender-balanced pool of trainers.

Operations serve multiple purposes. Among other things, they represent, for all participating agencies, the true test of individual and collective capacities.

Operation Cosmo 1 mainly served the WCO Secretariat’s aim to raise awareness among Customs administrations on their obligations when it comes to STCs, and to reveal operational challenges and capacity building needs. Indeed, information collected during the operation informed STCE training and capacity building efforts that followed. Last but not least, it helped set the stage for Operation Cosmo 2, conducted in 2018.

This second operation enabled participating administrations to, once again, test their capacity to identify illegal shipments and to get used to sharing information on illicit or suspicious shipments using STRATComm, the WCO’s secure communications platform for cases involving strategic goods.

Following the operation, many countries highlighted the value of the courses they had received while preparing for the operation, especially those on audit-based controls, risk management and the analysis of strategic goods. Many also expressed their appreciation for the ease of communication with Customs authorities in other countries through the use of STRATComm.

Likewise, countries also reported continuing challenges such as their need to improve risk management of strategic goods, their lack of domestic STC legislation, their lack of quick and reliable technical “reachback,” and the need to keep training new personnel on STCs. Cosmo 2 provided the WCO Secretariat with information and understanding on what countries need to move from classroom-based theory to practical fieldwork, and provided the Secretariat as well as participating countries with a path-forward for future work.

One of the challenges that companies and Customs face when implementing the legislation on strategic trade, and not the smallest, is control lists that generally do not take into account Customs tariff categories. Conversely, with few exceptions like nuclear reactors or some nuclear material, Customs tariffs generally do not take into account control list definitions (see again the article by Renaud Chatelus published in the October 2012 edition of the magazine).

As part of the overall STCE effort, the WCO Secretariat asked the Organization’s HS Committee to introduce a set of amendments to the HS Nomenclature related to dual-use items which were difficult to classify at the HS six-digit level or which were classified under residual subheadings along with many common goods. All proposed amendments were approved by the WCO Council in June 2019 and are included in the HS 2022 version of the Nomenclature.

The following data can be taken into account when trying to assess the impact of the programme:

• Operation Cosmo 2 gathered 114 countries, which makes it the most successful WCO global operation in terms of participation.
• A global network of STCE trainers has been established to support the Secretariat’s activities.
• Many administrations started training their staff without the assistance of the Secretariat, and some national Customs schools or academies have adopted the STCE training material developed by the WCO.
• The WCO training curriculum and implementation guide are used by other organizations training law enforcement officials including the Proliferation Security Initiative (PSI), and the export control outreach programmes of the European Union and the United States.
• The initiative has already led some countries to embark on policy enhancements, with some introducing dedicated Counter-Proliferation Units, setting up Counter-Proliferation Targeting Cells, and running regular STCE national training programmes and STCE-focused enforcement operations.

Let’s share two countries’ experience, namely the United Kingdon and Pakistan.

In the United Kingdom, following the accreditation of officers from the UK Border Force’s Heathrow Counter-Proliferation Team (CPT) and from Her Majesty’s Revenue and Customs (HMRC), a nationwide STC upskilling campaign was launched. Over the course of several training events, UK trainers reached frontline Border Force officers from various ports and airports, as well as officers from HMRC’s National Clearance Hub who set and monitor profiles for strategic goods. In addition to employing the WCO guidance and training material, they also made use of HMRC’s Risk and Intelligence Service’s assessments on risks inherent to each of the ports, focusing training on the strategic commodities exported or transiting from these ports. Training also detailed local detention and seizure processes, and the compelling national and international drivers requiring effective strategic trade control.

Efforts to improve STCE resulted in substantial systemic reforms in some countries, as the case of Pakistan well illustrates. In June 2016, a Pakistani officer attended a WCO accreditation workshop. Within a span of two years, more officers were accredited and the administration had established an impressive STCE training programme. Future officers were systematically trained and the STCE curriculum embedded into different training courses meant for the capacity building of mid-career and entry-level officers both for managerial and frontline streams. National workshops were also held, with and without the assistance of the Secretariat, and gathered not only Customs managers and frontline officers, but also importers and Customs brokers. By the end of 2018, 83 Customs managers, 299 frontline officers, and 1,232 importers and Customs brokers had received training.

Thanks to senior management engagement in Pakistan, on 4 September 2018, a National Counter-Proliferation Unit (NCPU) was created at Karachi and a Counter-Proliferation Training Cell at the national training facility. The unit was tasked, in close alignment with WCO STCE guidelines, to establish counter-proliferation teams at all the field offices which clear exports, to update the national risk management system, to support the Directorate General of Post Clearance Audit in selecting and conducting audits of companies engaged in the export of strategic goods, and to coordinate capacity building activities in the area of STCE.

Counter-proliferation teams have already been established at the two major ports in Karachi, which together clear more than 85% of the country’s exports. The NCPU is currently analysing Pakistan’s national database with the Strategic Trade Atlas to update their national risk management system, helping counter-proliferation teams in conducting physical examinations, providing “reachback” support to field offices, and functioning as Customs’ national focal point for the national licensing authority, namely the Strategic Export Control Division (SECDIV) at the Ministry of Foreign Affairs.

The value of the WCO STCE Programme has been recognized by the UN Office for Disarmament Affairs (UNODA) and the UNSCR 1540 Group of Experts. It has become a global standard for Customs training in the field of STCE and the more countries adopt it, the more effective the global non-proliferation system will be.

The success of the programme is partly due to its flexibility: the training curriculum can be adapted to different levels of STCE system maturity, and the commodity focus can be tailored to national priorities and trade flows.

The training also focuses on decision makers responsible for system design and resource allocation, not just implementers. More importantly, as STCE is not a traditional priority for Customs administrations, senior policy-level commitment and political will is vital.[v]

It is often said that where there’s a will, there’s a way, but the reverse can also be true. According to Morrissey and Verschoor, decision makers’ assessments of their capacity to implement reforms will influence their willingness to make commitments.[vi] By providing a way to build capacity to enforce STCs, the WCO may actually increase the chances that Customs administrations are willing to try.

More information
enforcement@wcoomd.org

[i] http://www.wcoomd.org/en/topics/enforcement-and-compliance/instruments-and-tools/guidelines/wco-strategic-trade-control-enforcement-implementation-guide.aspx

[ii] United Nations Development Programme, Management Development and Governance Division, 1998.

[iii] http://publications.jrc.ec.europa.eu/repository/handle/JRC111470

[iv] http://www.wcoomd.org/en/topics/nomenclature/overview/what-is-the-harmonized-system.aspx

[v] (PDF) Where There’s a Will, There’s a Way? Untangling Ownership and Political Will in Post-Conflict Stability and Reconstruction Operations. Available from: https://www.researchgate.net/publication/265748234_Where_There’s_a_Will_There’s_a_Way_Untangling_Ownership_and_Political_Will_in_Post-Conflict_Stability_and_Reconstruction_Operations [accessed Oct 17 2018]

[vi] Oliver Morrissey and Arjan Verschoor, “What Does Ownership Mean in Practice? Policy Learning and the Evolution of Pro-Poor Policies in Uganda,” in the IMF, World Bank and Policy Reform eds. Alberto Paloni and Maurizio Zanardi (London: Routledge, 2006)