Cargo Business Process & Standards INTERNATIONAL AIR TRANSPORT ASSOCIATION 2010 Version 0.2 01 June...

Cargo Business Process & Standards INTERNATIONAL AIR TRANSPORT ASSOCIATION 2010Version 0.2 01 June 2010

Industry Session, Tel AvivJuly 1st 2010

EU Safety and Security Risk

Management Systems

European Commission /

Taxation and Customs Union

1968-2008

2 Cargo Business Process & Standards INTERNATIONAL AIR TRANSPORT ASSOCIATION 2009Version 1.2 04 Feb. 2009

IATA Competition Law Compliance

Follow the prepared agenda Do not discuss:

Pricing, including fares, service charges, commissions, etc. Bids on contracts or allocation of customers Geographic/Product market allocations and marketing plans, including

expanding or withdrawing from markets Group boycotts Your commercial relations with agents, airlines or other third parties Any discussion aimed at influencing the independent business decisions of your

competitors

You will be asked to leave the conference call, and the conference call may be terminated, if the above-mentioned discussions occur


Disclaimer

Information provided is for guidance only and is not legally binding

This presentation contains excerpts from certain European Commission (EC) presentations and web pages

In the event of any discrepancies between this information and that of the EC, the EC information will take precedence


Meeting Objectives

Provide an overview of what EU requires as of 1 January 2011

Ensure awareness that business arrangements must be established between the forwarders and carriers

Raise awareness that certain technical requirements may have to be met

Promote and Provoke effective Airfreight Industry compliance


Meeting Agenda

1. Background

2. Economic Operator Systems

3. Export Systems

4. Import Control System (ICS)

5. Aviation Security Legislation



Management Systems Part 1, Background



1968-2008


WCO SAFE Framework


World Customs Organization Safe Framework of Standards WCO has defined the principles and standards for the 21st Century

Customs

The first objective of the WCO Safe Framework is to harmonize advance electronic cargo information and allow for advanced risks assessment

WCO has defined standard procedures, timelines and data requirements

166 countries have signed the WCO letter of intent to implement the WCO Safe Framework of Standards

Many countries have implemented advance electronic cargo information such as US, CA, IN and many are in progress EU, CN, MX, ZA, NG

Adobe Acrobat Document


IATA Strategy and Position


IATA Strategy CUSAG & IFCWGIATA Customs Advisory Group (CUSAG) Comprises 20 airlines or airlines associations

Monitors Advance Cargo Reporting around the world

Ensures Customs align as much as possible to international standards

IATA FIATA Customs Working Group (IFCWG) Co-chaired by an airline and a freight forwarder

Comprises 6 airlines and 6 freight forwarders associations

Develops recommendations on customs issues that involve airlines and forwarders


IATA Position PaperAdvance Security Notification (extract) Electronic submission should only become mandatory when Customs has the

capability to communicate electronically without paper in parallel All countries requiring advance security risk assessment information should move

toward the WCO Framework of standards It must be clear and unambiguous as to which party is responsible for providing each

element of advance information Customs should not require more information than laid out in the WCO Safe

Framework of Standards

Timings for submission of advance data should be consistent globally and in accordance with the WCO: Import Short haul: At time of “Wheels Up” of aircraft; Import Long haul: 4 hours prior to arrival at the first port in the country of destination Export information: Not earlier than 30 minutes prior departure



Meeting Agenda

1. Background

2. Economic Operator Registration

3. Export Systems





Management Systems Part 2 - Economic Operator Registration & ID



1968-2008


Economic Operator Registration & Id. (EORI)Legal Basis – EC 312/2009EC 312/2009 legislation answers the following questions:

What is an EORI number?

Who needs an EORI number?

Which country issue an EORI number?

How to get an EORI number?

Why Carriers and Forwarders need an EORI number?

EORI guidelines have been published by the EC

EORI website is available including EORI online training




Economic Operator Registration & Id. (EORI)Who needs an EORI Number?

Economic Operators (EO) Based in the EU

EO is defined as “ a person who in the course of his business is involved in activities covered by Customs legislation” such as

Importing into the EU, exporting from the EU or Transiting goods through the EU are activities covered by Customs legislation

Economic Operators (EO) based outside of the EU who engage in activities covered Customs legislation in the EU


Economic Operator Registration & Id. (EORI)Which country issues an EORI Number? If the Economic Operators (EO) is Based in a specific EU

Member State then this state shall issue the EORI #

If based outside of the EU the EORI # will be issued by the State where the EO performs its 1st Customs activities e.g. Customs Declaration

Exit or entry summary declaration

Apply for AEO status

Multinational companies often consist of parent company with several legal entities which can obtain their EORI #


Economic Operator Registration & Id. (EORI)How to get an EORI Number? EO who already deals with customs authorities in their own country

should have an identification number

Unless you have received an EORI number contact your Customs

If you never registered and need an EORI # then apply:

In your country if based in the EU

In the EU where you are required to register if based outside of the EU

The list of authorities who assign EORI and project managers are available on the EC website

Public interface is available via the Europa web portal with EORI #, name and address of EO who agreed to share such information




Economic Operator Registration & Id. (EORI)

Having an EORI does not grant Authorised Economic Operator (AEO) Status

AEO status is granted to entities who meet certain criteria and grants them customs facilitations such as:-

• Reduced scrutiny on shipments

• Reduced advance data requirement for Safety and Security checks (if all parties involved have AEO status)

EU has initiated mutual AEO recognition programmes with various non-EU states e.g. US, Japan


Meeting Agenda

1. Background


3. Export Systems





Management Systems Part 3 – Export Systems



1968-2008


Rules applicable

• Goods leaving the customs territory of the Communityhave to be covered by one of the following:

– Export declaration– Exit summary declaration– Re-export notification

• Regulation (EC) No 2913/92, OJ L 302, 1992, p. 1• Regulation (EC) No 648/2005, OJ L 117, 2005, p. 13• Regulation (EC) No 2454/93, OJ L 253, 1993, p. 1• Regulation (EC) No 1875/2006, OJ L 360, 2006, p. 64• Regulation (EC) No 273/2009, OJ L 91, 2007, p. 14• Regulation (EC) No 430/2010, OJ L 125, 2010, p. 10

EU Export Systems


Export declaration Required for:

– EU goods to be brought to a destination outside EU– EU goods brought to special fiscal territories within EU– Ship and aircraft supplies– Non-EU goods that are re-exported

Lodged by exporter or his representative Export declarations are lodged at the office of export For export declarations that contain safety and security data deadlines for lodgement apply (30 min. before aircraft that will carry goods out of EU leaves) Export procedure is discharged once the goods exit EU and confirmation of exit is sent by the office of exit

EU Export Systems


Exit summary declaration

Lodged for goods that are exiting and for which no export declaration is required:

• Goods moved between two MS via a territory of a third country• Goods transiting EU

Responsible for lodgement – carrier (other person can lodge with knowledge and consent of the carrier) Deadlines for lodgement apply (30 min. before aircraft that will carry goods out of EU leaves)

EU Export Systems


Re-export notification

Lodged for goods that exit directly from a free zone or temporary storage Responsible for lodgement – carrier (other person can lodge re-export notification with knowledge and consent of the carrier) Notification should be lodged at the office of exit following national specifications No deadlines apply

EU Export Systems


Meeting Agenda

1. Background


3. Export Control System (ECS)





Management Systems Part 4 – Import Control System (ICS)



1968-2008


Legal Basis (1) Regulation 648/05 (Amendment to Customs Code)

Authorised Economic Operators (AEO)

Common risk management framework/Customs controls

Electronic pre-arrival declarations (Entry Summary Declarations, ENS) for goods entering the EU ICS



Legal Basis (2) Regulation 648/05 (Amendment to Customs Code) Responsibility for providing the ENS (Reg. 648/05, Art. 36b 3 & 4):

“The person who brings the goods or who assumes responsibility for the carriage of the goods into the customs territory of the Community”.

Or

“with his knowledge and consent (agreed interpretation):• the person who acts in his name, or • any person who is able to present the goods in question or to have them presented to the competent customs authority, or• a representative”


Legal Basis (3)Regulation 1875/06 (Amendment to the CC implementing provisions)

Implementing provisions for Reg. 648/05 (e.g. time limits)• 31 December 2010

Includes Annex 30A (data requirement for ENS and EXS);

Relevant for air transportation:• Explanatory notes• Table 1 (default data set)• Table 5 (AEO reduced dataset)• New table 6 to be introduced for ‘diversion request’



Business Process


Business Process: Import within the EUStep 1 Step 2 only if needed! Step 3 Step 4

Entry summary declaration

Diversion request Arrival notification Presentation

of goods

Covered by functional specs ICS phase 1


To be defined and implement by Member States


Reg. 1875/06

Art 181b

Reg. 1875/06

Art 183e

(new process)

Reg. 1875/06

Art 184g

(new process)

Reg. 1875/06

Art 186 (1)

Short haul: take off

Long haul: 4 hours prior to arrival

When diversion is confirmed, prior to arrival

Upon arrival Unloading of goods

For all the goods on board, including FROB for third countries

(one or multiple ENS)

For the aircraft

(for parts of the cargo if MRN /MRN item number of the ENS is provided)

For the aircraft


For the goods to be unloaded



Step 1a: Send ENS to Customs Standardised electronic ICS message defined by EC (same data in all the

MS) but format defined at national level

Sent to:• Office of first Entry and possibly to the Office of Lodgement in another

MS (if accepted there)

Prior to arrival (legal time limits!)• 4hrs prior to arrival for long haul• Prior/at departure (“wheels up”) for short haul

Must contain Annex 30A data, including entry key data: • Mode of transport at border• Identity of means of transport: IATA or ICAO flight number• Expected date (and time) of arrival• Office of first Entry


Step 1b: Customs registers ENS Customs generates Movement Reference Number (MRN) upon registration of

the ENS

Confirmation of ENS registration communicated electronically by Customs to: 1. Person lodging ENS and 2. Carrier declared in ENS (if connected to ICS & if EORI number declared)

This confirmation contains information such as:• Person lodging the ENS (e.g. forwarder);• Carrier’s transport document;• MRN; and • other elements

Enable carrier to make sure that an ENS has been lodged





of goods





Reg. 1875/06

Art 181b

Reg. 1875/06

Art 183e

(new process)

Reg. 1875/06

Art 184g

(new process)

Reg. 1875/06

Art 186 (1)







For the aircraft


For the aircraft





Structure of Information


Structure of Information (1)Customs MessagesThe EC as well as each Member State are providing specifications:

High level list of data elements for Entry Summary declarations are defined in Annex 30A of EC regulation 1875/06

Detailed list of Data elements of the Entry Summary Declaration as well as Customs responses are provided by the EC

Format (e.g. EDIFACT, XML) and detailed list of data elements for all messages are provided by each Member State

List of ICS specifications per counties are now available

Acrobat Document

Microsoft Excel Worksheet


Structure of Information (2) Industry MessagesIATA has emended its standard CIMP & CXML messages:

House Waybill, Air Waybill, House Manifest and Flight Manifest messages have been updated to support the EC requirements

Key changes related to the EU requirements are: Additional Customs Information Identifiers; A more flexible Other Customs Information (OCI) line; Inclusion of the OCI line in the Consolidation List (FHL) message

As examples, these changes will facilitate the exchange of: The Movement Reference Number (MRN) The Economic Operators Registration Identification (EORI) number The scheduled arrival date & time at first point of entry

IATA CIMP available at: http://www.iata.org/ps/publications/Pages/cimp.aspx


Guidelines


Industry Roles & Responsibilities (1)Carrier reports ENSCarrier (or its representative e.g. GHA) reports the Entry Summary Declaration (ENS)

Forwarder will send FWB & FHL containing the required information to the Carrier

Using this information the Carrier will compose and submit the ENS to Customs e.g. BE Customs

Customs performs risk assessment and provides the MRN back as well as the notification of controls if applicable

Microsoft Word Document


Industry Roles & Responsibilities (2) Forwarder reports ENS-Forwarder reports the Entry Summary Declaration (ENS) information with Carrier knowledge and consent

Forwarder will obtain the Entry Key information (AWB, Flight etc.) and Carrier EORI # from the Carrier

Using this information Forwarder will compose and submit the ENS to Customs e.g. BE Customs

Customs performs risk assessment and provides the MRN back to the Forwarder & Carrier and the notification of controls if applicable

If Carrier EORI # provided & as an EDI connection with Customs Forwarder will send FWB & FHL including the MRNs to the Carrier Upon arrival the Carrier will provide Customs the Entry Key in the Arrival

Notification rather than the individual MRNs


Guidelines & Scenario: Import within EU

IATA has actively participated in a working group organised by the World Shipping Council to develop guidelines, overseeing the air mode sections.

Scenarios (examples) have also been published by the EC and the scenario related to Air Mode are available on page




National Implementation Timelines


National ImplementationICS Timelines (1/2)


National ImplementationICS Timelines (2/2)


National Contacts


National ImplementationICS National Project Managers National project managers can be contacted to have more

information on ICS at national levels

List of ICS project managers per country is now available

Microsoft Excel Worksheet


Other Considerations


Link between HWB/AWB & ENSAt what level an ENS should be created? ENS can be created at House Waybill or at Air Waybill level

depending on: Arrangements made between the Carriers and the Shipper/Forwarder Goods description needs to allow Customs to perform risk analysis

Merging goods descriptions of different commodities in one single ENS line item description is possible (356 characters limitation)

Examples:1. One ENS per MAWB with line item data equal to a HAWB. Each line

item will have an acceptable goods description or an aggregation of goods descriptions

2. Same as number 1 but no aggregation of descriptions3. One ENS per HAWB with ENS line item equal to one good description


ConsigneeCan it be the Forwarder? According to Annex 30A the Consignee is the ‘Party to whom

goods are actually consigned’

The objective is to get the importer address, if possible

Forwarder info acceptable if actual Consignee is not available to the Person lodging the ENS

Not providing the actual Consignee may aim to a higher level of risk


Goods DescriptionNon acceptable goods descriptions Document TAXUD 1402/2007 rev. 2 published on CIRCA (SAD

section)

Document provides guidelines

Non acceptable goods descriptions may trigger results in the risk analysis

Merging goods of different commodities (e.g. shoes and engines) in one single goods item of an ENS should be avoided

Microsoft Word Document


FROBDo I need an ENS? Freight remaining on board for a third country will need an Entry

Summary declaration

The Arrival Notification will also cover FROB


Primary Trade Issues Where the FF is expecting the Carrier to submit the ENS data required as

part of the legal obligation, the Carrier will need quality data from the FF at origin to be able to:- Ensure the data submission is made within the laid down time limits Provide data at a level which will ensure the shipments are not subjected to

undue scrutiny, e.g. HAWB Level Data not MAWB Level Data Receiving such data in paper format from the FF at origin will not allow

the Carrier to consolidate the flight data, prepare it and send it forward to the EU Customs Office of first entry within the time limits

Where a FF, with the Carriers knowledge and consent undertakes to submit the data to the EU Customs Office of First Entry themselves, they will need to:-

• Be aware where the aircraft is first entering the EU (First Airport of Arrival)• Be aware of the Carriers EORI to quote in the ENS• Be able to receive back the MRN issued by the EU Customs Authority


Meeting Agenda

1. Background


3. Export Control System (ECS)




EU Aviation Security Legislation

Legal Basis

• Regulation (EC) No 300/2008 of the European Parliament and of the Council

• EU Commission Regulation (EC) No 185/2010•

• EU Commission Regulation (EC) No 272/2009





EU Aviation Security Legislation Key Factors (1)

• Requires Member States to Implement enhanced Aviation Security Programmes

• Lays down requirements for Cargo Screening

• Lays down requirements for Known Consignor/Shipper and Regulated Agent accreditation

• Lays down requirements for Cargo Security Certification including data elements


EU Aviation Security Legislation Key Factors (2)

• Leaves many decisions on how to implement the Aviation Security to the MS Administrations e.g

Known Consignor / Regulated Agent accreditation methodology

Cargo Security Certification – May be in a separate CSC document or in the Transport Document– May be in paper or electronic format

CSC Archiving and Audit rules


EU Aviation Security Legislation Current Situation

Many Member States are not yet able to properly inform trade on their requirements Those Member States that have implemented the Regulation have done so differently, e.g.

• France require a CSC in a separate paper declaration• Luxembourg accept CSC in the e-AWB

Known Consignor / Regulated Agent Accreditation is more difficult to obtain in some MS’s than others


EU Aviation Security Legislation

Speaking at Air Cargo Handling Conference 2010, held in Brussels, Belgium, Dr Andrew Traill, Policy Director for the European Shippers Council said:-

“ Many shippers would not become Known Consignors because the EU regulations and requirements were confusing, left shippers unsure of any tangible benefits and unsure of the costs involved.”


EU Aviation Security Legislation IATA Proposal

Formulate a Working Group to identify a common recommended method of implementation to include

• Member State Administrations (Aviation or Transport Ministries)• Airlines• Shippers• GHA’s

Address the requirement for standard Known Consignor and Regulated Agent accreditation to be harmonised / standardised

Address the requirement for CSC to be harmonised / standardised

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