Border Agency Cooperation, Part 1 of 3

“A beloved child has many names”, goes an old Finnish proverb. This saying applies quite well in the context of ´smart cooperation between multiple agencies when dealing with cross-border supply chains, goods movements and transports´. The World Customs Organization talks about Coordinated Border Management (CBM); the European Union about Integrated Border Management (IBM); the World Bank about Collaborative Border Management (CBM); and Organization for Security and Cooperation in Europe about Comprehensive Border Management (CBM). Cross-border Research Association is aligning with a fifth term: Border Agency Cooperation (BAC), a term used in the Trade Facilitation Agreement of the World Trade Organization. Despite minor differences in scope, priorities, underlying principles and philosophies among these five terms (and possibly even more), one can easily agree that the work carried out under any and all of them aims to coordinate activities across and within various border control agencies, for the benefit of both governmental agencies themselves as well as supply chain companies.

Our first blog on Border Agency Cooperation, BAC, provides an illustrative worst case example on how complex, slow and expensive a cross-border supply chain execution comes when no cooperation takes place between relevant government agencies, neither nationally nor internationally. The illustration is about meat export from Latin America (Country X) to the European Union (Country Y), with maritime transport in reefer containers.

A well-known beef producer in country X– also the first Authorized Economic Operator (AEO) beef producing company in the region – has just signed an annual contract with a beef importer and distributor in country Y. As this is the producer ‘s first export deal to the EU, the producer needs to ensure that all licenses and certificates are up to the EU standard. Organizing health certificates, certificates of origin, sanitary certificates, export licenses – and what have we – takes weeks and weeks of time. There is no communication or procedures in place between the various agencies and officials to facilitate the process, no coordinated company visits or audits, no sharing of information, and no mutual recognition of inspections.

When all documents are finally in place, and regular exports can start, the beef producer and it´s forwarding agent face the burden of filing export data to customs, to sanitary agencies, and to national security agencies – with somewhat similar datasets, but with no single-window filing opportunity. And when export controls and inspections take place – which happens often – there is no synchronization of inspection times between the different agencies. One agency might come to inspect the reefer container on Monday noon, second one on Wednesday morning, and third on Friday afternoon – another week lost in the beef supply chain lead-time.

Once the consignment is happily on board towards the EU, one continues to experience lost BAC opportunities: no data is passed from country X customs or sanitary agencies to their counterparties in country Y, to enable pre-arrival compliance control and risk assessment. In case of criminal suspicions – e.g. when supply chain insiders exploit beef shipments for cocaine smuggling – no intelligence is shared between police and customs, from country X to country Y. The option of joint law enforcement operations between country X and Y police and customs agencies has never been even considered. Even on national level, both in country X and Y, the agencies are not co-operating neither on risk profiling and targeting systems, nor during criminal investigations and prosecutions – what a waste of resources when it comes to catching and convicting the bad guys…

In the meanwhile, some ten days later, the ship arrives at a major sea port in country Y. For the importer, there is no option for single-window data filing; instead, import data must be transferred separately to all different agencies in country Y. As the customs administration in country Y has no Mutual Recognition Agreement (MRA) in place with country X customs – neither when it comes to AEO certificates nor when it comes to recognizing inspections carried out at export – it treats the import as a “medium to high risk” one, calling for physical inspections. And as the sanitary agency does not share any common resources with the customs administration – particularly no joint inspection facilities and equipment, including x-ray machines – and even the daily opening hours are different from the customs hours, the sanitary agency carries out their own inspections only two days after the customs intervention. And finally, improving the situation does not seem likely, as there are no joint public-private partnerships, and no export/import compliance training sessions or similar in place, neither in country Y nor in country X.

This concludes the first of three parts of our Border Agency Cooperation (BAC) blog. In Part 2 – to be published next week – we will present CBRA´s conceptual model (Hintsa J., Dec.2015) on BAC key actions and beneficiaries: which key actions to take in order to speed up the logistics chain, to save costs with all actors, to increase overall predictability, and to improve government agency performance e.g. in terms of number of seizures and convictions. In the BAC Blog Part 2, we plan to present some preliminary experiences and real-life results from FP7-project CORE. Please stay tuned!