Maritime Anti-Corruption

Network National Single Windows

International Business Integrity Conference, Jakarta, 16-17 November 2016

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MACN Vision and Mission

Mission:

To promote good

corporate practice

in the maritime

industry for tackling

bribes, facilitation

payments and other

forms of corruption

Vision:

A maritime industry free of corruption that enables fair

trade to the benefit of society at large

52 Regular Members

MACN Members 2016

18 Associate Members Strategic

Advisors

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MACN’s two fundamental work streams:

− Implement MACN’s Anti-

Corruption Principles

− Developing policies and

standards

− Sharing best practices

− Creating tools

− Report on performance

− Raise awareness on challenges

& report on corruption trends

− Engaging in multi-stakeholder

dialog with business,

government, and local and

international civil society

organizations

− Design solutions in collaboration

with stakeholders

Internal: Focus on strengthening

MACN members’ anti-corruption

programs - “Walk the talk”

External: Engage with stakeholders

to improve the operating

environment

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Recognition from Implementation Partners

MACN Collective Action Portfolio and Partners

Indonesia

Argentina

Nigeria

Egypt India

China

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Challenges and approaches in Indonesia Indonesian ports identified as a corruption hotspot by MACN

member companies.

KEY CHALLENGES

− Common requests for facilitation

in form of in-kind demands

− Refusing to accommodate

results in delays or fines

COLLABORATIVE PROBLEM

SOLVING

− Improving dialog and

communication

− Establishing mutual

understanding of challenges

MACN

DG Customs & Excise

Pelindo II/JICT

TPK Koja

UKFCO

Kemitraan & other CSOs

Private Sector

KPK

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Agreed upon Actions in Indonesia

1. Establish an improved container tracking IT system that is

transparent for cargo owners

2. Establish a monthly stakeholder forum, where government agencies

and the maritime industry convene to discuss integrity challenges

3. Raise awareness about SOPs and regulations related to goods

transfer and import procedures

4. Integrate whistleblowing reporting into existing business processes

and SOPs

5. Develop an action plan for a cash-less system for the vessel

departure process for export

Single Window Systems

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Source: World Bank, UNCITRAL

National Single Window systems allow traders to submit all import, export, and transit

information required by regulatory agencies via a single electronic gateway, instead of

numerous times to different government entities, including some that are automated and

others that still rely heavily on paper.

The introduction of single-window systems has

positive effects on

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Value of Single Window Systems

− Georgia

− Qatar

− Korea

− Philippines

Governance Transparency Efficiency

Positive impacts are evident from e.g.:

− Singapore

− Korea

− Japan

− Thailand

…Ultimately helping facilitate trade and

economic development

1. Value of Single Window Systems

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• Cutting Costs Through Reducing Delays

• Faster Clearance & Release

• Predictable Application and Explanation of Rules

• Effective & Efficient Deployment of Resources

• Increased Transparency

Private Sector

• Effective & Efficient Deployment of Resources

• Correct Revenue Yield

• Improved Trader Compliance

• Enhanced Security

• Increased Integrity & Transparency

Government

Single Window Systems as anti-corruption

solutions

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Single Window Systems can reduce corruption via increased levels

of transparency and accountability

• Automated system captures data that can serve as an audit trail

• Greater clarity and systemization of SOPs and Regulations reduces

individual discretion and associated opportunities for corruption

• e-payments and approvals reduce face-to-face interactions

opportunities for illegal facilitation payment requests

Single Window Systems - Preconditions

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Implementation isn’t easy.

• Not a simple “plug and play” activity;

• not possible to replicate what has worked in one country in another country

...Critical preconditions need to be in place, including:

• A strong business case based on a pragmatic assessment of risks, challenges

and capabilities;

• A clear mandate from government backed by genuine political will;

• A realistic future vision – owned by all stakeholders;

• Agreement on governance structures, including which agency will lead the

initiative, with clear roles and responsibilities for all key stakeholders, and

obligations and accountabilities for success; and

• A practical work program with key milestones matched by appropriate human

and financial resources.

Source: World Bank

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Lessons Learned from other countries on

private sector engagement 1. Early and Ongoing Involvement: Involve the private sector as early as

possible to ensure private sector support for and use of the new system.

2. Define Requirements and pilot the system: Engage with the private sector

to determine specifications and to test/enhance the system.

4. Offset Investment Costs: Consider offering financial assistance to the first

group of companies willing to use and invest in the new system.

5. Communicate and Build Capacity: Arrange information sessions, make

material and handbooks available, and offer comprehensive training programs

on how to operate the new NSW system efficiently.

6. Establish Help Desk: Help Desk and technical support teams should be

available 24/7.

7. Continue the Dialogue: Establish forums with the private sector to discuss

how to further improve and develop the system.

Private Sector Actions

Engage with the public sector to ensure the NSW system

meets your business needs

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1. Participate in defining the requirements for the system based on your needs

2. Partake in piloting the system and offer feedback

3. Define requirements for training and support functions for rolling out the system in your organization

4. Communicate and raise awareness about the NSW across your supply chain

5. Maintain the public-private sector dialogue to continuously improve the usefulness of the NSW

www.bsr.org

www.maritime-acn.org

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• Karlyn Adams

Associate Director

• BSR

• kadams@bsr.org

BACK UP - Case Studies

Singapore

Malaysia

Japan

Korea

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TradeNet Singapore Singapore established the world’s first national single window

for trade (TradeNet) in 1989, bringing together more than 35

border agencies.

Today TradeNet handles more than 30,000 declarations a day,

processes 99% of permits in 10 minutes.

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Main Benefits of TradeNet

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Private Sector

• Increased Efficiency

• Reduction in the turnaround time for processing of typical trade documents from 2 – 4 days to as little as 15 minutes

• Cost Reduction

• Time saving for users from filling out single online form versus over 20 paper forms in the past

• Freight forwarders have reported savings of 25%-35% in handling trade documentation

Government

• Cost Reduction

• Reduced trade documentation processing costs by 20% or more

• Faster Payments

• Customs moved from a system of post-approval of applications to pre-approval, such that Customs duties are now pre-paid through electronic means and Customs receive payments faster

• Faster and more Accurate Statistics

• Enabled faster compilation of more accurate and complete external trade statistics

Key Success Steps: Singapore

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1. Establish Multi-Agency Steering Committee

• The lead agency should set up and chair a multi-agency steering committee with private sector representation as early as possible. This will ensure private sector support for and use of the new system when it is developed.

2. Define requirements of the Primary Users of the System

• Government agencies are the primary users of the system and should take the initiative in consultation with the private sector to set up the NSW system for the benefits of all participants.

3. Offer Partial Government Grants to pilot system

• To defray part of the expenses and to enlist support, the government agencies may consider giving financial assistance to the first group of companies willing to use the new system

4. Training and Technical Support

• Comprehensive training programs need to be developed to train the staff of both the public and private sectors on how to operate the new NSW system efficiently. Help Desk and technical support teams must be available

Dagang Net Malaysia In the 1990s, Malaysia began to look for ways to move away

from traditional paper-based document systems.

In 2004 Malaysia completed the nationwide rollout. At present,

Dagang Net covers both the maritime and aviation sector, and

handles payment of duties and taxes.

Since 2009 application and approval of import-export permits

are managed via the system. 20

Main Benefits of Dagang Net

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Private Sector

• Speedier processing of permit applications resulting in reduction of days required to export.

• Longer service hours allow for greater and more flexible market activity.

• Improved service & customer satisfaction via 24/7 Careline Service

• Reduced red tape and associated manual labor costs

Government

• Increased collection of customs duty payments

• Better compliance as seen in the huge increase from 40M electronic document transfers in 2003 to 275M in 2009.

• Better control and enforcement through risk management tools.

• More effective and efficient management of resources, in particular reduction of manpower needs and hardware costs.

NACCS Japan Japan first introduced a paperless trade system

in 1978, which has evolved into a Single Window

system.

Sea-NACCS, which processes import/export

by sea, was put into operation in 1991. In February 2010,

Air/Sea-NACCS became one unified system

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Key Success Steps: Japan

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Stakeholder Engagement

•Coordination among stakeholders was crucial to determine specifications of system.

•All of the relevant parties joined the coordination from the initial stage in moving toward the Single Window establishment.

Communication and Training

•The NACCS Center arranges various explanatory meetings and uploads materials timely on their website.

•Helpdesk is available

Participation of the Private Sector

•The Government of Japan has established forums with the private sector to take considerations by both private and governmental sectors into consideration. For example, the Ministry of Finance has organized the “Public-Private Forum of Next Generation Single Window” for this purpose.

UNI-PASS South Korea UNI-PASS single window system now connects 38 regulatory

agencies to service 55 different documents as a one-stop

service.

The system has been recognized internationally - having been

mentioned as Best Practice by the World Bank - and the

Doing Business Report for Trading Across Border have

evaluated the Korean time for import to be 2 days and for

export 3 days, much lower than the OECD average.

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Main Benefits of UNI-PASS

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Private Sector

• Reduced turnaround time: Korean-based companies such as Samsung and LG, note that achieving rapid and predictable turnaround time is an important aspect of their competitive strategies.

• Reduced clearance procedure time by reducing the document preparation

• Reduced logistics cost by providing a faster clearance with annual cost savings increasing exponentially since its implementation.

• Savings of transmission cost by using e-documents

• Improved productivity by automating administrative work

• The total savings for the business community, estimate to be 1 billion and 818.9 million USD

Government

• Reducing clearance procedure time by reducing the document preparation

• Reducing logistics cost by providing a faster clearance with annual cost savings increasing exponentially since its implementation.

• Savings from transmission cost by using e-documents

• Improved productivity by automating administrative work

• Improved management, storage and retrieval of information and documents through use of Information Technology.

• The Korea Customs Service estimates that the introduction of its single-window system brought some $18 million in benefits in 2010.