The challenges and opportunities for international trade, the role of technology, the consequences of the coronavirus, the economy and the profile of new consumers were the axes of the videoconference organized by the Chilean Customs Chamber, with relevant presentations and important participants from Latin America.
At the opening of the meeting, held on August 21, 2020, Felipe Serrano Solar, President of the organizing entity and Vice President of the Southern Cone area of the International Association of Professional Customs Agents (ASAPRA), mentioned the difficult times brought about by the COVID-19 pandemic and the commitment to move forward with a positive outlook towards the future for the good of humanity and foreign trade.
Along those lines, he continued. Fabian Villarroel Rios, an accredited expert of the World Customs Organization and Director of Regulatory Affairs for Latin America at DHL Express, who spoke about the current global context and the implications for international trade. He also referred to the opportunities and challenges that the post-pandemic will generate.
Stage
Fabián Villarroel Ríos said that “starting in 2020, governments have set a series of restrictions on the movement of people, which affects passengers, but not the traffic of goods, although it had an impact on air cargo transport.”
The specialist explained that the express industry used to transport part of its goods by means of commercial aircraft, but when they were suspended, this implied an increase in the rates for cargo aircraft.
“Cargo had to wait to be included among essential activities, without regional or global guidance. Therefore, the industry tried to justify its inclusion among essential activities so as not to interrupt the supply chain of those goods considered critical such as medicines and respirators, among others,” explained the expert.
The restrictions
“Governments are beginning to impose restrictions on exports of essential supplies, imports are becoming more difficult, and special authorizations from the Ministry of Health are being required, which is being issued without any harmonization between countries,” said Villarroel Ríos.
In this regard, he detailed two examples of measures. On the one hand, the Decree 405 / 2020 de Argentina indicates that products for the prevention and treatment of Covid-19 (respiratory protectors, gloves, respirators, etc.) require export authorization from the Ministry of Productive Development with the intervention of the Ministry of Health. On the other hand, the Decree 462 / 2020 de Colombia bans the export of products to address the health emergency caused by Covid-19. The measure aims at self-sufficiency.
“This revealed the Lack of regional multilateral regulatory frameworks that they were able to give guidelines in the context of the emergency," he emphasized.
Villarroel Ríos said that “there was a certain psychosis over the supply (respirators, masks). The US president spoke of invoking the Defense Production Act to stop exporting the famous N95 mask.”
“What will happen with the vaccine?” he asked.
The facilities
“In April, governments begin to adopt trade facilitation measures to ensure the supply of these critical inputs, which exempted them from customs duties and taxes (VAT),” considered the specialist in customs and international trade.
“As an example, we have the Decree 551/2020 of Colombia which provides for the exemption of VAT on the import of 221 goods. On the other hand, Peru established tariff rates applicable to the importation of goods linked to the declaration of a health emergency," he explained.
“They begin to freeing taxes from these goods "Because, obviously, it was necessary for them to arrive. But every measure has its consequences," he clarified.
The first consequence was that alcohol gel or many masks were passed through without paying taxes and with the authorization of the Ministry of Health. So, there was a jam at customs because the goods, although they did not pay taxes, had to wait between five and thirty days in the warehouses, because the Ministry of Health did not have the personnel or the capacity to control these large volumes. Although the facility existed from the tariff point of view, the merchandise was retained in the warehouses of all means of transport.
Here one wonders, where were the single windows for foreign trade (VUCE)? This issue calls on us to reengineer so that these goods have a more expeditious procedure.
Another thing that happened in Colombia was that the textile industry began to protest and requested not to import masks, since the market could be supplied through its own inputs. In other words, each measure has different results depending on the context in which it is to be developed.
Along with the exemption from customs duties and VAT, other measures were established to facilitate the import of critical inputs and goods in general, through the establishment of digitalized customs procedures, the non-obligation to obtain health certifications or VBs and non-intrusive virtual inspections.
Resolution 2302/2020 of Chile authorizes the carrying out of documentary review, instead of physical review. ANMAT of Argentina ordered non-intervention in the importation of face masks and gloves for sixty days (which has been extended).
Some countries have introduced other innovative facilities that are not directly related to the import and export processes. Peru, through SUNAT Customs Resolution 6-2020/300000, approved the discretionary power not to determine or sanction violations provided for in the Customs Law during the health emergency period. Chile, Through Resolution 1556, it authorizes customs agents to prepare the entry declaration based on a non-negotiable copy of the bill of lading.
It was noted that the Authorized Economic Operator figure did not work as it should because the AEO had the expectation that customs would recognize the certification to operate more quickly. But specifically this did not materialize. It is worth considering that the AEO should have a type of facilitation when an emergency is declared.It was noted that the customs officers, the first line, never stopped operating.
Consequences
The stage showed two issues: first, the Absence of multilateral or regional emergency regulatory framework that would be applicable in this type of circumstances so that common borders can be managed. The lack of regulations had two complicated events. One, in Central America, when a Covid-19 test was required for truck drivers on the border between Nicaragua and Costa Rica. Another event occurred in Uruguay, also with land transport. This reveals the need to define common procedures at land, sea and air borders for these purposes.
The second question would be move towards certain facilitations: digitalization, virtual or non-intrusive inspections, intensive use of VUCEs, expedited channels for Authorized Economic Operators.
Covid-19, an opportunity
Fabián Villarroel Ríos spoke about the challenges that arise from the changes brought about in international trade. The expert presented the following concepts mentioned below.
- The need to review certain elements of the OAS and the VUCE.
- El voluntary compliance and sanctions. “Let us change the focus of customs administrations from being focused on sanctioning to being agents that promote voluntary compliance with regulations,” he said.
- El e-commerce It is here to stay. “People have experienced time savings and consumers are increasingly younger. However, e-commerce represents enormous challenges for Customs, because it involves dealing with people who are not classified and cannot profile the risk in the same way.”
- El e-commerce It must be joined with the SMEs. “Here, SMEs are relevant, not only because they have been excluded from international trade, but because they have an opportunity to join the lines of this type of digital trade. There is an opportunity for governments. Subsidy aid is not enough: all the actors must be brought together," he said.
- The common guidelines for emergencies will be necessary. “I was surprised that certain blocks such as the Pacific Alliance had not issued emergency guidelines. That is where the integration processes commercial needs more voice,” he emphasized.
- La Coordinated border management: moving forward in transfer areas“It is unacceptable that we concentrate so many officials at the borders. There is a lack of innovation to manage culture in a different way.”
- The Virtual or non-intrusive inspections will be important to make the merchandise review process faster and easier.
- La generation of public and private spaces. «The national facilitation committee is established in the countries, but progress is needed. Stereotypes must be broken. The knowledge To generate confidence. . The emergence of Covid invites us to reflect and work together to build a more inclusive international trade that benefits citizens," the expert concluded.
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