Types of Controls
Border management can take place at three main locations along a corridor: at a gateway port or airport, at a land border station, or at an inland clearance facility. When there are controls for the same shipment at two or more of these locations, there is need for coordination and even integrated systems and procedures between these locations, without which some processes may be repeated, increasing costs and time.
144 Trade and Transport Corridor Management Toolkit There are two interrelated sources of delay in the border clearance of goods: the presence and involvement of regulatory agencies at the border and the procedural steps followed by these agencies to clear drivers, vehicles, and goods. Each has to comply with the laws, regulations, and policies of all of the countries through which goods transit. Although customs in most countries is the main front line state agency at the border, their checks constitute only one process that must be completed to move freight across borders. Several other agencies carry out their own checks (table 5.1).
Border Agencies Involved
In most countries, multiple agencies—as many as 40 in a few countries—are involved in border management. It is therefore important to identify which agencies are operating at each border crossing in a corridor and whether they intervene directly in processing and clearing goods. A distinction should be made between the agencies involved in clearing goods at a designated customs clearance facility and those that are physically present at a border station. Some agencies may be involved in clearance but not necessarily physically present at the border station. The roles played by the most impor- tant agencies are summarized in table 5.2.
Although border performance is a function of the performance of regula- tory agencies, service providers, infrastructure, and the interactions among them, the involvement of numerous agencies in the border-clearance pro- cess can result in duplication of paperwork, which in turn can be a source of
TABLE 5.1 Types of Border Checks of Cargo, Vehicles, and Drivers along Roads in a Corridor
Cargo Vehicles Drivers
• Customs transit control (for taxation purposes)
• Customs control of restricted and prohibited items
• Quarantine inspection (phyto-sanitary and veterinary health inspection)
• Technical conformity board, food and health, dangerous and perishable goods control, and so forth
• Infrastructure usage fees • Vehicle insurance • Transport authorization • Weights and dimensions • Vehicle technical certificates
and roadworthiness • Customs security of loads • Quarantine inspections • Special features for vehicles
(for example, equipment and identification marks for refrigerated trucks or vehicle carrying dangerous goods)
• Passport and visa • Customs inspection • Quarantine inspection • Driver’s licenses
• Special certificates (for example, for the transport of dangerous goods)
• Service license
• Health/vaccination certificate
Border Management in a Corridor 145 delays at borders. This problem may be particularly acute in corridors of
low-income countries, where not all agencies may be automated. The requirements of the many agencies provide scope for administrative discre- tion at the corridor level, which in turn provides incentives for traders to resort to “speed payments” to expedite cargo clearance.
Clearance of Goods
Good practice in the clearance of goods is typically guided by World Customs Organization guidelines. Modern practices are described in McLinden and others (2011). Review and reform of the border-clearance processes can yield benefits in reducing crossing times. Complex procedures are often a result of, as well as a reason for, the involvement of numerous players in the clearance processes. They can also lead to corrupt practices at the border.
It is critical to understand and map the goods clearance process (see annex figure 5A.1 for an example of a process map). The process map can form the basis for proposing simplification and streamlining of the clearance TABLE 5.2 Roles of Different Agencies in Border Management in a Corridor
Agency Controls at the border
Customs Customs officials collect or secure duties. Though the traditional role of customs of collecting duties has waned in high- and middle-income countries, it remains important in low-income countries, which rely heavily on customs revenue.
Quarantine Quarantine officials ensure the health of people, animals, and plants by preventing infectious diseases and alien pests from entering the country. They disinfect vehicles, monitor health regulations, and check health carnets.
Public health, agriculture
Public health agencies enforce sanitary and phyto-sanitary requirements by obtaining documentary evidence (certificates) or testing and physically inspecting cargo.
Standards Industrial products may be subject to verification of their conformity with international, regional, and national standards for health, safety, security, and fairness.
Security Security considerations at most border stations worldwide were strengthened in the wake of the September 11, 2001 terrorist attacks. These considerations created the need for detectors to prevent the entry or exit of radioactive material. Atomic energy control bodies intervene when a suspicious consignment is detected.
Environment Environmental agencies control hazardous waste, enforce recycling regulations, and regulate trade in endangered species items and protected products, such as timber. Foreign affairs In some countries, consular officers can issue visas at the border.
Immigration Immigration authorities verify the identities of people entering or exiting the country, largely by passport and visa checks. In some countries, customs also handles
immigration functions. In some countries, immigration checks are handled by a special department or by police (border police/border guards).
Transport Transport authorities weigh trucks, collect road taxes, and enforce transport permit and licensing requirements.
146 Trade and Transport Corridor Management Toolkit process. The mapping should make a distinction between goods passing through a border in transit and goods for domestic consumption. Different border regimes and procedures apply depending on how the goods and the vehicles that carry them will be handled. Goods in transit should be treated under the general guidance presented in Module 6.
Import for home consumption, also known as final clearance, changes the status of a good from international to domestic cargo. Domestic status could be defined as eligible for free circulation in the domestic market. Clearance requires payment of import duties and domestic taxes as well as compliance with national regulations applicable to the domestic market. Customs and other agencies are involved in the clearance process. For customs, the basic reference document is the commercial invoice, which describes the interna- tional sales contract between the seller (often an exporter) and the pur- chaser (often an importer). In many countries, declarants are limited to the cargo owner and its legally authorized agents.
Clearance of goods imported for home consumption need not necessarily take place at the border; it can occur inland. For inland clearance, inland container depots and dry ports have evolved as a convenient intermediate solution between clearance of cargo at the border (generally the least conve- nient option for shippers) and clearance on the buyer’s premises (the most convenient option for the importer but the least convenient for customs). They are ideal locations for any transshipment or transloading of cargo.
Nontariff Barriers
An increasingly important source of costs and delays faced at the border are nontariff measures (NTMs). A survey of NTMs in East Africa found that clearance from as many as six public regulatory agencies was required to meet food safety, agricultural health, and quality standards in Uganda (World Bank 2011). NTMs refer not only to procedural requirements on the move- ment of goods but also to restrictions on the delivery of transport services. Unlike tariffs, which are subject to multilateral trade negotiations, NTMs on imports for home consumption are often nontransparent and hence provide scope for administrative discretion. Business surveys reveal that procedural requirements for complying with technical barriers to trade (TBTs) and san- itary and phyto-sanitary (SPS) requirements are important at the corridor level. These measures are likely to become more important in the coming years, given the increasing number of goods subject to them and the media attention given to health and environmental concerns.
Countries often impose TBT and SPS requirements for legitimate reasons. It is the prerogative of countries to impose such requirements—provided the
Border Management in a Corridor 147 specifications are transparent and scientifically justifiable, less trade restric-
tive alternatives are not locally applicable, information regarding such speci- fications is easily available to the trading community, and the requirements are not subject to revisions without notice.
TBT requirements are imposed on manufactured goods to ensure that imported goods conform to specifications (such as size, design, labeling, and packaging). From a trade facilitation perspective, the cost and time associated with meeting and confirming the compliance requirements are important, as these requirements also apply to the inputs imported by domestic export-oriented enterprises (such as the imports of textiles by Bangladesh and Nepal or goods entering into much of the intraregional trade in electrical goods in East Asia). Compliance with these require- ments may require certification by a national bureau of standards. The state agencies responsible for enforcing the TBT requirements are typi- cally present at the customs border, not necessarily at the border station (in countries where they are separate). This assignment of responsibility can cause delays, because samples have to be sent to laboratories at some other location.
SPS measures on agricultural goods are imposed to protect public, plant, and animal health. Expediting the border clearance of fresh produce or live animals in particular (fresh fruit, vegetables, and livestock) is crucial as such goods are time sensitive. Increasingly, SPS requirements are imposed on canned and agro-processed goods as well. Complying with SPS require- ments can be time consuming, as border clearance of these goods may require certification and physical inspection from state agencies.