... Continuing with the coverageThe XVI World Meeting on Customs Law, held in Germany - the heart of Europe - concluded successfully on Friday (29.09.23), after two days of dissertations in which the high academic level of the exhibitors was made clear through an exchange between parties to delve deeper into the topic of the meeting: “Customs in times of global change.”
This Friday, September 29th was the The second day with three scheduled panels, as announced by Andrés Rohde Ponce, President of the International Academy of Customs Law, the organization in charge of the activity.
Here are some highlights from the day's panels:
3 Panel. "New criteria on key customs issues"
The block was moderated by the Dr. Horacio Felix Alais, Professor at the Universities of Buenos Aires and Austral, and experts from Italy and other countries participated.
Dr. Sara Armella (Associate Professor at Bocconi and Sapienza Universities) and Dr. Massimo Fabio (Professor at the Universities of Rome and Milan) spoke about the database and the possibility as references. In particular, Dr. Armella highlighted rulings by courts of justice, recalling the decision of the Italian Court of July 2023 by which it was resolved that it cannot be observed (challenged) by means of statistical values - databases cannot be used. Meanwhile, Dr. Fabio Massimo addressed the issue of "Transfer Prices" and the difficulties that arise in understanding such a concept and the tax base, producing differences between customs and companies, as well as regarding the effects that subsequent adjustments may produce. He considered it relevant to find an understanding between the parties in order to adopt a uniform criterion. To this, the expert added proposals, for example: the possibility that the company be exempt from rectifying in the event of adjustments that may be made.
Furthermore, the Dr. Corina Heyder, an expert from the Federal Customs Valuation Office, spoke about “Customs Valuation and Reasonable Doubts”, for which she carried out an analysis of the scope of Article 17 of the Gatt Valuation Agreement, the criteria of the World Customs Organization (WCO), the possibility of customs to observe the value, considering the need to define what the method is and who has the burden of proof. She recalled that the European Union, when consulting the WTO regarding defining the issue related to the burden of proof in value reviews, decided that additional information can be requested and if the doubts are not resolved, the subordinate methods must be used. And she pointed out that reasonable doubt is reviewable by the courts.
In his turn, Dr. Fabian Octavio de la Torre from Steffano, President of the World Compliance Association Mexico Chapter, presented “Customs Compliance” and started from reports on the increase in the supply chain. In this regard, he considered it essential to find a compliance and risk project, through processes and standards, considering risk analysis as a fundamental tool. In this regard, the expert mentioned the precedent of German legislation, in terms of requiring compliance under the purpose of best practices. And he highlighted the situation in Mexico regarding the presence of Agreements that establish these issues, having to carry out reforms of internal standards for this purpose. He pointed out the need for a cultural change, both in the public and private sectors, in order to establish a compliance management system and basic rules, with a disciplinary framework that focuses on preventing risks one hundred percent, and in case these arise, being able to have programs that make it possible to act quickly. Regarding this, de la Torre de Steffano concluded with points that make it possible to implement a system in this sense, highlighting the importance of training and supervision. The Commission also considered that its implementation generates positive effects: reduction of criminal risks, strengthening of trust, improvement of reputation with third parties and contribution to free and secure trade.
In turn, the Dr. Enrique Heron Jimenez Ramirez, Consultant and Expert in Tariff Classification, developed “The evolution and future of the Harmonized System”. Due to his extensive experience in the harmonized classification system, he asked if it is time for a modification, for which he highlighted the relevance of what classification results in customs matters. In this sense, he made a historical overview of the current nomenclature, to which he added striking testimonies of the importance of the work that was done to arrive at this system, highlighting the people who have acted for it; he highlighted variables that were taking place, such as going from four digits to six, incorporating new groups due to the need to add new merchandise. Thus, 35 years have passed and, ultimately, the rules have not changed, -he pointed out-, although there is an evolution of foreign trade that calls for considering a new harmonized system. To this end, work must be done on this aspect in order to avoid tariff disputes, and he gave the example that the same merchandise can have a classification difference simply because it is for domestic or non-domestic purposes, as well as the presence of items that are not in use. He concluded by considering that the current harmonized system must be supplemented by a new one.
4 Panel. "Customs Harmonization and Economic Integration"
This instance was coordinated by the Dr. Juan Patricio Cotter, Member of the Board of Directors of the International Academy of Customs Law.
In his speech the Dr. Christian Forwick, Head of the Subdepartment for Foreign Economic Policy, Trade Policy and the Americas, German Federal Ministry for Economic Affairs and Climate Action, referred to the “Diversification of EU trade relations with respect to the Americas: a German perspective on resilient and sustainable trade relations”. He highlighted the EU's free trade agreements with the rest of the regions and countries and identified the differences between progress made with some countries and not so much with others, despite the importance for the EU of being able to carry out such agreements. For example: MERCOSUR. Regarding this initiative, Forwick said that there is a geo-economic concern, adding to this the presence of China, which is reflected in Argentina, Brazil, Uruguay. He indicated the benefits of the agreement EU-MERCOSUR, namely: a) Modern regulatory framework with stable and predictable rules for trade and investment; b) Intellectual property rights, digitalization, food safety, competition, simplification of procurement of customs procedures, regulations and technical standards, c) Sustainable trade.
Regarding the situation with Chile, The expert noted the presence of many contacts with the trans-Andean country, pointing out its potential as the fifth largest economy in Latin America. He pointed out that Germany, in particular, is interested in many goods, since it does not have mining. And it is also useful for Chile to be able to have extraction techniques for all those resources. In this way, he indicated the relevant points of this EU-Chile relationship, underlining that EU-Chile trade in goods grew by 163% between 2002 and 2021, EU goods exports to Chile grew by 284% in the same period, 99,9% of EU exports will be tariff-free = further increase in EU exports to Chile to €4.500 billion, cooperation on clean raw materials and fuels crucial for the transition to the green economy, such as lithium, copper and hydrogen, easier for German and EU companies to provide their services in Chile and the Strong Sustainability chapter – (Review Clause).
In relation to the EU-Mexico, He said that unlike the American government, which is focused on fossil fuels, we (the EU) have a more modern view, aiming at renewable energy, which is what will replace the current one. Consequently, we want to give priority to this agreement. A high potential is estimated, starting from an emerging Mexican economy of 129 million and an EU market of 448 million people. Thus, the EU-MEX Global Agreement from 2000 is currently under negotiation. He said that the new agreement is equal to new commercial opportunities for both parties (for example, reciprocal access to public procurement, liberalization of trade in agricultural products), strong and clear commitments on human rights, sustainable development and the fight against corruption.
About the UE y USMCA (USA, Mexico, CAN), clarified that it is an interesting market, but it is seen as a gateway to Mexico rather than the USA. He reflected on the salient points of this relationship, among which were indicated: Protection of intellectual property, workers' rights, dispute resolution: 3 mechanisms, SME chapter and German experience.
El Dr. Achim Rorgmann LLMM, Dean of International European Law of Brunswick, Faculty of Law, Ostfalia University of Applied Sciences, presented the “General Report on Modernization of Revised Kyoto Convention”. Starting from a historical analysis of the Kyoto Agreement, he was able to reflect on the capacity of Members and non-Members; he detailed the chapters of the agreement and considered that the agreement should be revisable and the annexes made binding (it is an idea). But if this were so, he stressed that there are those who maintain that no one would accept it and the attractiveness of an agreement is measured by its adherence. Despite this, he stressed that new approaches are required, emphasizing that the agreements need to be improved to strengthen and overcome crisis situations, which he compared to Tsunami. He recalled that in 2008 a working group was set up for the review; at the first meeting of the Working Group on the Comprehensive Review of the Revised Kyoto Convention (WGRKC) It was appropriate to achieve a better balance between trade facilitation and security, and it was important to strengthen the binding nature of the RKC and its different parts (soft law versus hard law), periodic review/follow-up mechanisms, need for implementation mechanisms, technical assistance and capacity building, improved use of electronic data submission. In this way, he highlighted the concepts and proposals of the review process and reflected those points that have had the greatest number of proponents, namely: customs control (16), rules of origin (12), data problems (12), use of advanced technologies (11), coordinated border management (10), authorized economic operator – AEO (9), monitoring, reporting and evaluation (9), electronic declaration (8), electronic payment of duties (7). He concluded with the details of the next meeting of the review management committee that will be in December; work has been done to achieve these objectives that result in the need for a change.
In turn, the Dr. Pablo Villegas Landázuri and Dr. Fernanda Inga, President of the Ecuadorian Institute of Tax Law and President of the Ecuadorian Institute of Customs Law, respectively, referred to “The standardization of customs infractions and sanctions. Basis for their harmonization”. In this sense, Dr. Villegas Landázuri considered that harmonization in any branch of law is important, starting from modernization and highlighting to a greater extent and in particular customs law, being one of the most globalized branches of law. Thus, he indicated that it is possible to harmonize in terms of customs sanctions or infractions, despite the cultural differences that denote disparities as to what can be a crime for one society and what is not for another. He highlighted positive aspects for this proposal, estimating that there is a vocation to globalize customs law. To support this work, he directed his postulate to the General Agreement on Tariffs and Trade of 1947, the revised Kyoto Convention and the Agreement on trade facilitation. He noted that Article 6 of the Trade Facilitation Agreement refers to disciplines on the duties and charges established for imports and exports, details on sanctions, from what point of view and the form of imposition. Likewise, although he recognizes that when it comes to classifying customs crimes and infractions there is no consensus on what should be considered a customs crime, he noted that a starting point is to propose as a recommended practice that the protected legal asset be customs control. To which he added principles that are maintained, such as the legal reserve in customs criminal matters, the right to non-occurrence of customs sanctions, punitive proportionality and the limit to the investigative powers of customs administrations.
Then, the Dr. Fernanda Inga, Continuing with this topic, he referred to the differences between the concept of infractions and crimes, recalling the positions of authors, in many cases present in the audience. He indicated that customs infractions are breaches of the duty of obedience or collaboration with the customs administration, being culpable acts and abstract danger, they are not malicious, nor do they cause damage. He considered that the global trend is the decriminalization of crime. Thus he denoted the relevance of responsibility and its criteria, between objective and subjective responsibility, estimating that, with respect to each one, difficulties are seen; and he specified that by assuming an objective criterion, sanctions can end up being imposed for the conduct of third parties, while in the subjective criterion the application can be ineffective by reducing the agility in the final resolution. He highlighted that there are so-called mixed positions that serve to apply the objective criterion for formal situations and the objective one for the rest. In any case, he considered that the tendency is the subjective criterion in terms of responsibility, and in other cases, the burden of proof is reversed in order to prove the lack of subjective responsibility. When dealing with the sanction, he estimated that there is no consensus, and then focused on the analysis of the procedures, including in this subject the prescription, the expiration, the precautionary measures and the fundamental principles that must be present, rescuing the prescription and expiration as limits to the administration. He concluded with the need to work on the harmonization of this infractional and criminal framework. Although it may be difficult, he is confident that a consensus can be reached, with the possibility of taking advantage of the upcoming opening of the Kyoto Convention.
El Dr. Yan Duval, Head of the Trade Facilitation and Policy Section, United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP), advanced on the topic of Mega Free Trade Agreements on International Trade in Pacific Asia. He stressed the relevance of the presence of 347 agreements in Asia Pacific, emphasizing that Mega agreements are growing and cover deeper issues, not only preferential trade, but others that contribute to trade facilitation. This trend began in 2000 and continues to increase. In this regard, he explained its importance for including benefits that cover issues that are not immersed in the WTO, indicating digital trade. Its relevance makes different countries want to join, as is the case of Canada and Mexico, among others. Thus, digitalization was a topic highlighted by the speaker, who considered it a matter that must be addressed because it is positioned as a driver of change. It is necessary to address issues that are still not established in many agreements and a deep analysis must be encouraged. He stressed that trade facilitation in regional Mega agreements, although they incorporate issues on facilitation, lack specificity, which is when the presence of separate agreements occurs. In this way, in addition to the Mega regional agreements, he indicated that “we have other Trade/Digital Economy Agreements.” Specifically:
- Trade Agreements/Digital Economy
- Japan-US DTA (2019), DEPA (2020), Singapore-UK DEA (2020)
- Mini FTAs
- Less formal technical cooperation agreements
- MoUs based on existing PTAs (China-Chile MoU on labour and social security cooperation)
- Thailand Mini FTAs Focusing on Cooperation with Specific Regions/Industries (Thailand – Kofu, Japan (2021) on Gems and Jewelry Cooperation)
- Provisions for trade in times of crisis
- New Zealand - United Kingdom (2022)
- See UN HANDBOOK ON TRADE ARRANGEMENTS IN TIMES OF CRISIS AND PANDEMIC (2021) / Model RTA chapter on trade in crisis situations.
There are many agreements being concluded, said Ducval, and he considered that the cost should be reduced with harmonized systems and that the price of being outside these agreements can be very high. Issues that prioritize digitalization must be reached to promote the streamlining of procedures, the exchange of cross-border documents. He highlighted the responsibility that must be the private and public sector, reflecting initiatives that aim at facilitating sustainable trade, the perspective of women, human rights, the paperless framework agreement that has the basic idea of facilitating trade without paper documents and how it can be managed. Finally, he underlined the TINA system, which is a tool that helps to reach agreements or join current ones, through the externalization of reports that denote their existence.
5 Panel. "Doctrine and Bibliography"
The meeting ended with a presentation by Dr. Enrika Naujoké (Editor of the monthly electronic journal Customs Law for Professionals and Director of the Association of Customs Professionals of Lithuania) and Dr. Rosaldo Trevisan (Judge of the Superior Chamber and President of the Fourth Chamber of the Third Section of the Administrative Tax Court of Brazil).
The specialists referred to the importance of the doctrine. Thus, the Dr. Enrika Naujoké He reviewed the current advances in Artificial Intelligence (AI) and its possible threat, but considered the possibility that it may be seen as a great opportunity for quick solutions. This implies the need for more trained personnel. He estimated that a book by and for Customs is necessary, thus targeting young people who have their gaze focused on the Internet and social media rather than reading. But the purpose of learning must be maintained, promoting reading through books that denote the characteristic of “non-AI books”, proposing labels that visualize it; this would be through a classification HI (human intelligence) and AI (artificial intelligence). He suggested promoting access to all sources.
In turn, the Dr. Rosaldo Trevisan, highlighted the latest bibliographies on the subject, referring to the following works:
● Mexican Customs Law (Volume I and Volume II); Trade Facilitation, Dr. Andrés Rohde Ponce.
● Customs Law (Volume III), Montevideo: La Ley, 2021. Dr. Pablo González Bianchi.
● Customs Law (Volume I and Volume II), Bogotá, Dr. German Pardo Carrero, Santiago Ibañez Marsilla (cord.), Dr. Enrique Carlos Barreira, Ricardo Xavier Basaldúa, Hector Guillermo Vidal Albarracin, Juan Patricio Cotter, Julio Carlos Lascano and Horacio Felix Alais (Argentina); German Pardo Carrero, Juan Jose Lacoste and Porilla Gutierrez (Colombia); Edgar Fernando Cosio Jara and Julio Guadalupe Bascones (Peru); Rosaldo Trevisan (Brazil); Andres Rohde Ponce (Mexico); Pablo Labandora and Pablo Gonzalez Bianchi (Uruguay); Juan Jose Perez Cotapos Contreras (Chile); Santiago Ibanez Marsilla (Spain); Sara Armella (Italy).
● Customs Offences and Sanctions (Bogota), German Pardo Carrero. Enrique Carlos Barreira, Ricardo Xavier Basaldua, Hector Guillermo Vidal Albarracin, Juan Patricio Cotter and Horacio Felix Alais (Argentina); German Pardo Carrero, Juan Jose Lacoste, Rogelio Porilla Gutierrez and Ramiro Araújo Segovia (Colombia); Edgar Fernando Costo Jara and Julio Guadalupe Bascones (Peru); Rosaldo Trevisan (Brazil); Pablo Labandera (Uruguay); Juan Jose Perez Cotapos Contreras (Chile); Santiago Ibanez Marsilla (Spain).
● Topics Atuais de Direito Aduaneiro III (San Pablo), Rosaldo Trevisan (Org), Andrés Rohde Ponce (Mexico), Enrique Carlos Barreira, Ricardo Xavier Basaldúa and Juan Patricio Cotter (Argentina), Germán Pardo Carrero (Colombia), Rosaldo Trevisan, Liziane Angelotti Moira e Fernando Pieri Leonardo (Brazil).
● Território Aduaneiro Vol. I (Sao Paulo), Gernando Kotzias, Fernando Pieri, Leonardo Branco, Liziane Meira, Rosaldo Trevisan (Brazil); Ricardo Xavier Basaldúa (Argentina).
● Constituiçāo, Tributaçāo e Aduana no Transporte Maritimo e no Atividade Portuária (Belo Horizonte), Osvaldo Agripino de Castro Junior (Org.).
● Controvérsias Atuais do Direito Aduaneiro (São Paulo), Angela Satori, DanielBettamio Tesser, Thais Guimaráes (Org.).
● Direito Aduaneiro e Direíto Tributário Aduaneiro (Belo Horizonte), Onofre Aves Batista Junior and Paulo Roberto Colmbra Silva (Coord).
● Ensios de Direito Aduaneiro II (San Pablo), Claudio Augusto Gonçalves Pereira, Raquel Segalla Reis (Org.).
● Customs valuation (Bogotá), Juan David Barbosa Mariño (Dir.)
● Customs Direito (Lisbon), Tánia Carvalhais Pereira (Coord.)
Closing
Once the panels were over, there was applause for the Closing ceremony, with the final words of the Dr. Hans-Michael Wolffgang (Director of the Institute of Customs Law and International Trade at the University of Münster ICTL) and the Dr. Andres Rohde Ponce (President of the International Academy of Customs Law ICLA), who thanked the large attendance and highlighted the presentations of each panel, which were loaded with a deep trajectory in the field of knowledge; visions aimed at shedding light on a central issue: “Customs in times of global change.”
According to the latest data released by the International Academy of Customs Law, representatives from 35 countries from all five continents have come to the Humboldt University of Berlin.
Is that all we can learn from the XVI World Meeting on Customs Law? Of course not. We will continue to unravel much more.
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