US Integrators Welcome Bali Deal

US Integrators Welcome Bali Deal

Shippers using air cargo and expedited services will be among the biggest beneficiaries of the World Trade Organization’s Bali Package of reforms agreed to last week, express providers believe.

Section 8 of the trade facilitation agreement lays out specific reforms designed to improve global standards and procedures for expedited shipments.

These are aimed at creating an expedited process for the release of air cargo after arrival, separating the release of the goods from the final resolution of the financial aspects of the transaction, and encouraging each country to set a de minimis value below which duties and tariffs are not required, thereby enabling the rapid release of low-value shipments.

Other reforms that will benefit the express sector include measures pushing for greater use of paperless transactions, the creation of national single windows for submission of shipment information to all relevant government agencies, and the establishment of trusted trader programs.

Michael Mullen, executive director of the Express Association of America, said the Bali deal signed by all 160 WTO members was a “remarkable achievement.”

“The commitments on electronic transactions and adopting a single window for the trade to submit information to governments are enormously important,” he said. “Many of the world’s customs and other government agencies still rely too heavily on paper submissions, and the savings that could be obtained by moving to electronic data, not to mention the benefits for the environment, are significant.”

“The creation of a single window is probably the one most important step most WTO members could take to improve the efficiency of their border clearance operations. The current need to respond to multiple agencies’ information requirements, often highly duplicative across each government, presents the global logistics system with a spaghetti bowl of regulations that are very costly to satisfy.”

“The U.S. is planning to move toward a single window with the implementation of the International Trade Data System (ITDS) by the end of 2015, and the express industry is very much looking forward to the reduced transaction costs that will provide.”

However, Mullen said the express industry would have preferred the Bali deal to include a firmer statement on the de minimis value — for example, by specifying an amount such as $200 — and not providing an exception for VAT tax.

“But the key issue is how each member will now implement the de minimis provision and all the other commitments,” he said. “We hope members will establish a commercially relevant de minimis level that accelerates the movement of low value, usually also low risk, packages across borders.”

Contact Mike King at mikeking121@gmail.com.