Text 8.2. The role of customs

IN TRADE FACILITATION

International trade has grown rapidly in recent years, thanks to the progressive reduction of tariffs and quotas through successive rounds of multilateral trade liberalisation. More trade means more goods crossing borders and having to comply with Customs formalities. This has often put strain on national administrations trying to cope with the increased traffic without extra resources.

In these circumstances, inefficiency in border procedures is costly, both for governments and business. Businesses suffer both direct costs, such as expenses related to supplying information and documents to the relevant authority, and indirect costs, such as those arising from procedural delays, lost business opportunities and lack of predictability in the regulations. Inefficient border procedures cost governments in terms of lost revenue, smuggling and difficulties in implementing trade policy, for instance because of failure in determining the origin of products or in collecting accurate statistics.

These challenges have led to a need for a review of the total trading process. Both commercial and administrative management are becoming more aware of the increased efficiency, reduced costs and better customer service that can be obtained from adopting trade facilitation techniques.

Trade facilitation is a key policy for Customs. Trade facilitation covers all the steps that can be taken to smooth and facilitate the flow of trade. Trade facilitation can be defined as «the simplification and harmonisation of international trade procedures including import and export procedures». Procedures in this context largely refer to «the activities (practices and formalities) involved in collecting, presenting, communicating and processing the data required for movement of goods in international trade»¹.

In the 21st century, the WCO views the accepted mission of Customs to «develop and implement an integrated set of policies and procedures that ensure increased safety and security, as well as effective trade facilitation and revenue collection»². This new strategic direction, as outlined by the WCO, has the folowing strategic building blocks:

1. Globally networked Customs – the need for an «e-Сustoms»network that will ensure seamless, real-time, paperless flows of information and connectivity. It's necessary for Сustoms-to-Сustoms transactions as well as Сustoms-to-business transactions. It should be supported by an internationally standardized data set, interconnected systems, mutual recognition and coordination protocols between export and import transactions (eg. Authorized Economic Operators), and by a set of rules governing the exchange of information between Customs administrations (including data protection).

2. Better coordinated border management – this involves bettercoordination and communication between the various border agencies and authorities. Additionally, there is a need for an electronic «single window» (eg. the International Trade Data System in the US (ITDS) that allows the trade to provide all necessary information and documentation once to the designated agency that in turn distributes it to relevant agencies.

¹ Taxaion and Customs Union.

² Customs in the 21st century. Enhancing Growth and Development through Trade Facilitation and Border Security.

3. Intelligence-driven risk management – a more sophisticatedunderstanding of the risk continuum is needed. Scarce resources require that targeting be done at the higher end of the risk spectrum.

4. Customs-trade partnership – Customs should enter into strategicpacts with trusted economic operators (eg. C-TPAT, AEO). The relationships must result in mutually beneficial outcomes.

5. Implementation of modern working methods, procedures and techniques – the demand for rapid movement of goods, combined withcomplex regulatory requirements, calls for more audit-based controls undertaken away from the border, moving from transaction-based controls to system-based controls (eg. the US' Automated Commercial Environment (ACE)), and moving away from paper systems.

6. Enabling technology and tools – taking advantage of new andemerging technologies to enhance processing, risk management, intelligence and non-intrusive detection.

7. Enabling powers – the appropriate legislative provisions must beimplemented to strengthen enforcement powers, provide for advance information, and sharing of information domestically and internationally. It is needed especially in the area of combating organized crime, while protecting the safety of Customs officers.

8. A professional, knowledge-based service culture – movementtowards a more customer-oriented model. Staff competencies need to support timely customer-focused processes and services that minimize the administrative burden on legitimate trade. Effective change management and leadership skills will also need to be developed.

9. Capacity building – Customs administrations need to ensure they havethe capacity and skills to perform Customs functions efficiently and effectively. Leadership from developed Customs administrations is critical to ensure sustainable capacity building (eg. the WCO Columbus Programme). The (WCO) defines capacity building as activities which strengthen the knowledge, abilities, skills and behavior of individuals and improve institutional structures and processes in such a way that the organization can efficiently meet its mission and goals in a sustainable way.

10. Integrity – the fight against corruption will remain an importanttask that will need to be undertaken for years to come.

These building blocks provide solid guidance for Сustoms administrations in the 21st century to ensure not only an environment that will facilitate legitimate trade, but also allow Сustoms administrations to focus limited resources on those areas deemed highest risk.

EXERCISES

I. Find the words/phrases in the text which follow the verbs below.

1. to comply with 8. to smooth

2. to put strain on 9. to ensure

3. to cope with 10. to provide

4. to determin 11. to result in

5. to collect 12. to undertake

6. to adopt 13. to take

7. to strengthen 14. to combat

II. Speculate about the following:

How do Customs administrations plan to adapt to meet the demands of the 21st century?

Study the following words and word combinations from the text.

VAT – value added tax НДС

excise duties акциз, акцизная пошлина, акциз-

ный налог

to remit освобождать от уплаты налога

goods of strategic товары, имеющие стратегическое

importance значение

to enforce special controls обеспечивать соблюдение специ-

on certain goods ального контроля в отношении не-

которых товаров

a compilation of trade компиляция торговой статистики

statistics

TEXT 8.3. HM CUSTOMS & EXCISE

The role of Customs in revenue collection and social protection is extremely important but this has to be balanced with the role of Customs in trade facilitation.

This is how the British Customs Service (properly known as Her Majesty's Customs and Excise), often abbreviated toHMCE) sees itsrole today.

Main responsibilities.As well as the collection of VAT and exciseduties Customs and Excise is also responsible for:

ü collection of Customs duties and agricultural levies for the European Community;

ü enforcement of prohibitions and restrictions on imports and exports;

ü tasks connected with foreign trade including the collection of trade statistics.

Customs duties.The assessment and collection of Customs duties onimported goods have always been one of the main functions of Customs and Excise. However, one of the consequences of membership in the European Community has been a change in the nature of Customs duties. In addition, Customs and Excise collects and controls the other charges which may be levied at import and remitted at export, such as excise duties and VAT.

Import and export controls.Most goods may be imported into theUK under the authority of an open general import licence. However, the importation of a limited range of goods originating in certain specified countries needs individual import licences issued by the Department of Trade and Industry. Certain goods which are of strategic importance can be exported under the authority of a licence from the Department of Trade and Industry. Customs and Excise is responsible for ensuring that goods are not imported or exported contrary to these restrictions or to any prohibition or restriction imposed for the protection of public, animal or plant health, on moral and humanitarian grounds, for conservation purposes or for various other reasons. The prevention of drug smuggling in particular is one of the top priorities.

Control of freight.Goods imported into the UK and the ships,aircraft and vehicles carrying them must be reported to Customs. The goods cannot be removed from the place of importation without Customs

authority. In most cases a written declaration, a Customs import entry, is presented for this purpose. The entry is used to enforce special controls on certain goods and for the collection of trade statistics.

At export, Customs and Excise has a dual responsibility to carry out any controls on exported goods and to collect all the data necessary for the compilation of a large variety of trade statistics. Information about all exports must be supplied to Customs before shipment in order to meet these requirements.

Control of passengers.Travellers entering the UK must declare allarticles obtained abroad or during the voyage or flight if the goods exceed the statutory allowances. At most major ports and airports operating the clearway system of self-selection, travellers make a declaration by entering either the Red Channel, if they have goods to declare, or the Green Channel, if they have not. Travellers leaving the UK must also pass through Customs control the aim of which is to prevent evasion of export licensing regulations.

The European Community is seeking to harmonize Customs rules and procedures in all its member states. It has also proposed the abolition of most Customs controls over the movement of passengers and goods between member states. In addition there are plans to make Customs freight procedures as efficient and effective as possible by making maximum use of data processing techniques and electronic data interchange methods.

Answer the following questions:

1. What is VAT?

2. What are the main responsibilities of Customs Services?

3. What is the British Customs Service responsible for as a member of the European Community?

4. What is the «clearway» system?

5. Why has the nature of Customs duties changed?

6. What remains one of the top priorities for Customs and Excise?

7. What dual responsibility does the British Customs Service have?

8. How does the British Customs Service prevent evasion of export licensing regulations?

9. What is the European Community seeking to do?

10. What advantages do the EC member-states have?

FOLLOW-UP ACTIVITIES

I. Fill in the gaps with the English equivalents of the words in brackets.

Reference words: airports, representatives, collect, country, Customs, Balance of Trade, export licences, figures, goods, government, imported, taxes, forbidden

CUSTOMS

Basically, the (таможня), or Customs and Excise to give them their full title, are (представители) of a country's ( правительство). They are

а (правительство) department really. They are found at ports and (аэропорты), the places where people bring goods into the (страна). Now, they have four functions. The first is to calculate and (собирать) the duty on (ввозимые) goods which are dutiable. You don't have to pay (налоги) on all (товары). The second function is to issue import and (экспортные лицензии) for restricted goods. The third function is to prevent trade in (запрещенные) goods. That's to stop people trading in certain drugs, wildlife, etc. The fourth function is to collect import and export (цифры). They use these (цифры) to calculate the country's (торговый баланс).

II. Match left to the right to make a sentence complete.

1. Many Customs administrations today are faced with ...

2. According to the IMF the value of global trade ...

a. ... based on the Columbus Decla-ration on Customs Efficiency.

b. ... is likely to result in even higher trade volumes.

3. The creation of the WTO ... c. ... amounts to over US $ 3,700,000 (annually).

4. The UN Conference on Trade believes that the cost of the voluminous Customs paperwork, complex formalities ...

d. ... and associated delays and errors can be as high as 10 % of the total value of the foods traded.

5. The WCO is currently e. … as a barometer against which a working on a set of Good Customs administration will measure

Management Practices ... its performance.

6. It is intended that these f. ... an increase in the volume and

practices will serve ... speed of international trade.

III. Finish the sentence by filling in the following table. Connect the figures (1-5) with the letters (a-f).

The role of Customs Services is to help Governments to achieve their objectives in the areas of …

1. revenue	by
2. industry	by
3. trade	by
4. social protection	by
5. protecting the environment	by

a. ... preventing the illegal importation of chemicals, toxic substances, endangered animals and products made from them.

b. ... collecting duties and taxes and protecting the revenue base.

c. ... controlling and processing imports and exports and working in partnership to help importers move their goods quickly and smoothly.

d. ... administering relevant Government policies concerning imports, exports, tariffs and anti-dumping laws.

e. ... stopping illicit drugs, pornography, weapons and other illegal imports flowing into countries.

f. ... ensuring goods which have a national heritage status do not leave the state without proper authorization.

IV. Translate into Russian.

The traditional view of Customs administrations as primarily enforcement agencies must now be balanced with new roles – those of organizations providing services to clients and facilitating the movement

of international trade. They are therefore faced with the delicate task of determining and maintaining the correct balance between the requirements of enforcement and facilitation which are sometimes contradictory.

V. Find the first sentence to the following text. Choose from:

1. World's economies and communities are becoming more and more reliant on co-operation and partnerships.

2. The world social and economic environments are changing.

3. Many Customs administrations today are faced with an increase in the volume and speed of international trade.

4. These are challenging times for both Customs and the international trade community .

Both are going to have to change their mode of operation. It will take much consultation and coordination to ensure the changes are accomplished with minimal disruption of trade and without taking any unnecessary compliance risks.

Traditionally, Customs have been concerned with collecting revenue, exercising a control on imports and exports and catching smugglers. A relatively recent addition to that long-standing role has been the collection and control of excise duty and an even more recent development for some administrations has been responsibility for indirect or value added tax.

VI. Discuss the following with your partner. Supply some additional information. Make use of the following phrases:

In my opinion ...

I'm afraid you are not quite right ...

I think so too ...

If carriers should:

1. еnhance their security at foreign terminals, aboard their aircraft and vessels;

2. co-operate closely with Customs in identifying and reporting suspected smuggling attempts;

3. base their tariffs on the Harmonized System.

If Customs should:

1. provide training to carriers' employees in the areas of baggage and cargo security, cargo profiling, personnel security and vessels and aircraft search;

2. help carriers collect external trade statistics;

3. apply simplified tariff schedule on all carriers' goods.

VII. The following verbs and nouns can be used to describe upward (↑) and downward (↓) movements in price, quantity, amount, etc.

	VERBS
↑		↓
increase, rise, go up		cut, fall, drop, go down
	NOUNS
↑		↓
an increase, a rise		a cut, a fall, a drop

Complete the following sentences using a noun or a verb from the list above.

1. The application of all added responsibilities has led to … in the complexity of Customs regulations.

2. In recent times international trade and traffic … significantly.

3. The problems of smuggling will continue … in many parts of the world.

4. In many countries budgetary … are the order of the day.

5. The role of Customs is rapidly … due to the changing world.

6. The … in profits is the result of poor management.

7. Some countries fear the … in illegal cross-border movements of goods.

8. Unfortunately, the amount of money spent on research and development … last year.

VIII. Read the following texts, translate the underlined words into Russian and discuss the issues raised in the two texts with your partner.

Text 1

For many Customs commercial fraud will soon assume new dimensions and importance. In developing countries the collection of revenue will remain very important. In developed economies the issue will not be revenue but rather the circumvention of sensitive trade regulations and controls. In this respect the ability of companies advised by clever trade lawyers to manipulate prices will cause increasing concern.

Text 2

In countries that have recently adopted a market - driven economy the task for the Customs is to transform itself into an effective mechanism capable of:

– protecting the internal market and thereby regulating demand andsupply;

– co-operating with policies of economic reconstruction and;

– contributing to government revenue.

IX. Translate into English.

Таможня играет ключевую роль в международной торговле.

В осуществлении любой внешнеторговой сделки таможня участвует по меньшей мере дважды: один раз – при экспорте и один раз – при им рте. П этому ясно, что работа таможни оказывает

_{существенн}границы. ^{е влияние на движение товаров через международные} X. Translate into Russian.

I

«More and more Customs administrations are beginning to realize that the survival of Customs depends on the transformation of its «bag-opening gate-keeper» image into one of «the facilitator and protector of

society». As a result, Customs officers can now be heard using words like facilitation, consultation, dialogue, image, effectiveness, etc., when describing their functions».

II

«In many countries Customs see themselves not as making a «barrier» to international trade but as an integral part of the international trade process».

(TP. Hayes, 1993)

XI. Agree or disagree with the following statements. Give your reasons. Discuss your answers with your partner. Supply some additional information.

1. Why do the Customs administrations of the world have different areas of responsibility? Does it depend only on the national legislation governing their activities?

2. What is one prime responsibility that every Customs Service has?

3. There is no one model of Customs Service in the world to follow.

4. The size and the shape of a Customs Service is usually determined by its staff and not the challenges it faces.

5. It is the country itself which must decide on the Customs Service it needs to meet the particular needs and objectives of its government.

6. To be a success a Customs organization needs only an adequate legislation.

7. With the proper infrastructure, management, resources, policies and procedures a Customs Service can play its role in achieving and supporting government policy.

8. Government objectives are set by public opinion.

9. To be effective a Customs Service needs legislation, human, financial and technical resources, performance standards, accountability and integrity.

10. Customs procedures are designed to achieve objectives set by government policy in the areas of trade monitoring and revenue collection.

11. Customs is an obsolete, hollow and impoverished organization.

12. The Belarusian Customs Service needs to make better use of risk assessment, business and personal performance measurement and audit techniques.

13. Customs should not be transparent in its transactions with clients.

14. A Customs Service is simply a means of administering Customs procedures.

DO IT FOR FUN

I. Complete the following proverbs and translate them into Russian:

1.	A friend in need …	9. Old … are not be caught …
2.	Actions … words.	10.	Second thoughts are …
3.	… that ends well.	11.	… and have it.
4.	As you make your bed, …	12.	Birds of a feather …
5.	East or west, …	13.	Every … to his …
6.	… before you leap.	14.	… will be.
7. Make … while the sun …	15. One man …
8.	… never come alone.	16.	… is the parent of safety.

II. Fill in the table «False Friends». Consult the dictionary if necessary.

FALSE FRIENDS

Russian	English	False Friend	Russian
Адвокат	solicitor,	advocate
	barrister
Аргумент	reasoning	argument
Капитал	money, wealth	capital

Russian	English	False Friend	Russian
Комиссия	committee, board	commission
Контроль	inspection,	control
	supervision
Интеллигент	educated,	intelligent
	sophisticated
Нервозный	irritated	nervous
Практика	training	practice
Ревизия	inspection	revision

III. Complete the tables.

	A
I. VERBS		NOUNS
1. enforce
2.		application
3. pay
4. implement
5. facilitate
6.		intervention
7. collect
8. protect
9.		legislation
10. immigrate
11. import
II. ADJECTIVES		NOUNS
1.		responsibility
2. safe
3. complex
4.		budget
5. efficient

II. ADJECTIVES

NOUNS

6. commerce

7. effect

8. inevitable

9. value

10. consistent

В

Translate the following sentences using the words from the tables above.

1. Товар был продан ниже своей себестоимости.

2. Эти меры, хотя и непопулярные, способствовали восстанов-лению экономики.

3. Эффективность новой системы прошла проверку на несколь-ких предприятиях.

4. Он отвечает за коммерческую ко еспонденцию компании

5. Было трудно поверитьуспешно,чтонекото ый риск неизбежен.

6. Многие университеты сотрудничают в области науки образования.

7. Правоохранительные власти несут ответственность за безопас-ность в городе.

8. Вчера на встрече обсуждались условия платежей.

9. Все исторические ценности находятся под охраной госу-

дарства.^.и

UNIT 9. THE PROFESSION OF A CUSTOMS OFFICER

Study the following words and word combinations from the text.

a campus	университетский городок
to drop out	бросить учебу
vocational training	профессиональная подготовка,
	обучение
to do a Masters / do a Master's	уч	ться на магистра
degree
a postgraduate	асп	рант
hectic	суматошный, суетливый