Sooryadev Singh PURMAH, MBA Team Leader, Customs

(Trade Facilitation & Customs Cooperation)Joined Customs & Excise Dept in Feb 1972

Total area: 67×46 = 2040 sq kmPopulation: 1.3 million (est)Mono-crop economy to a diversified one: sugar, industrial manufacturing, tourism, financial services, freeport activities, ICT, sea food hub87% of tariff lines at zero rateIsland state with no natural resources

World Bank Doing Business 2012 Out of 183 countries:

• Ease of Doing Business - 23rd

• Trading Across Borders - 21st

• Paying Taxes:11th

MRA-Customs Department Collects 34 % state

revenues

670 customs officers

1 Seaport and 1 International Airport

350,000 declarations per year (total)

Triggers for Change: Trade Facilitation v/s Control

Limited resources in contrast with dramatic increase in volume of trade & travel

Globalization: Liberalization of governmental policies on cross-border movement of trade and resources

Technological developmentDevelopment of institutions to support and facilitate

international trade Increased global competitionProtection of society & terrorismPublic criticism

Objectives of Customs Trade Facilitation Programme Attain revenue targets Implement Government

economic policiesReduce economic

distortions associated with smuggling and commercial fraud

Create a ‘level playing field’ for traders

Facilitate honest traders while targeting high risk ones

Promote transparencyPromote voluntary

complianceEnsure predictabilityReduce discretion and

corruption

Managing Change at Mauritius Customs

• WCO Customs Reform & Modernization Programme (CRMP) as from 1998 and Project Management Concept as from end of 2002

• CRMP : Orientation Meeting with policy makers → Diagnosis & Planning: Team of Facilitators - WCO, HM Customs, Revenue Canada: Data Collection, Diagnosis & Report: 3 Workshops

• Project Management Concept: Team constituted & Strategic planning approach

Outcomes of Diagnosis Mission & Implementation Strategy

1. Outcomes• Vision: Towards a clean & efficient Customs• Mission: Fiscal, Economic, Protective, Business Support• Strategic plans: Based on 6 Primary Functions

2. Implementation• Steering Committee• Change Management Team (+ consultants)• Implementation Teams in 6 priority areas

• Work Improvement Teams• Evaluation• Recruitment of expatriates in Oct 2006 & Feb 2009 to boost

ongoing reforms

Major Changes Over The Years1. Paradigm shift: gatekeeper to facilitator2. Partnership with business3. Automation - Customs Management System (CMS/EDI).4. Implementation of WTO Valuation Agreement, Post Clearance

Control System5. Schedule of duties/SOP manuals for officers6. Redeployment of staff and creation of various enforcement units 7. Code of ethics for officers and customer charter for stakeholders8. Complaints Bureau9. Tariff Information Unit10. Autonomous unit for air-freighted goods 11. Customs Investigation and Intelligence Unit including a drug cell12. Non-Intrusive Inspection Techniques (NII): Scanners13. Centralized Risk Management Section

Other Trade Facilitation InitiativesSingle Window office for Cargo InspectionSingle Window office for ExportersEcertificate of originCARGO FAST TRACK Program - AEO projectCargo Community System – Electronic platform for

tracking & tracing of containersExpress Courier Hub Project Integrated Tariff and Tariff Classification Rulings

databases on web-siteRules, regulations, procedures, SOP manual for

stakeholders & administrative forms available on websiteIntranet system for officersAppeal Mechanism Excise reforms

Requisites for Capacity Building in Customs

WCO definition: ‘Developing or acquiring skills, competencies, tools, processes and resources needed to improve the capacity of the administration to carry out its allotted functions and achieve its objectives.’

Sustained Political Will & CommitmentLeadership & Stakeholder SupportOwnership & Participation of Customs PersonnelAdequate Human and Financial ResourcesEffective Human Resource Management PracticesParadigm shift: Gatekeeper Mentality to FacilitatorPartnership with Business CommunityCommunication StrategyStrategic Management Approach & Change Management

Model

Strategies to create a“World Class” Customs Service

Institutional InfrastructuralTechnologyTechnical

assistance/consultantsApply international

Customs conventions , best practices and control techniques (e.g., risk management & post-clearance controls)

Modernize Customs law and regulations

Simplify, standardize & harmonise customs procedures

Effective Human Resource Management Practices

WCO & WTO Trade Facilitation Instruments

HS Convention RKCArusha DeclarationCustoms Reform & Modernization ProgrammeColumbus Programme – WCO Framework of StandardsWTO Valuation AgreementTime Release StudyWCO Data ModelRules of origin

Institutional Change - 1 July 2006 Mauritius Revenue Authority (MRA): revenue depts

under one umbrella as a corporate body to act as agent of government:

Vision: World Class Revenue ServiceMission: Continually reform and modernize in order

to achieve effectiveness and efficiency comprising with highly motivated and skilled staff.

Core Values: Integrity, Responsiveness, Fairness, Transparency, Accountability

MAURITIUS REVENUE AUTHORITY ORGANISATION STRUCTURE

Existing Offices Renovated to Improve Customer ServiceExisting Offices Renovated to Improve Customer Service

‘RED/GREEN’ Channel @ SSR Arrivals

Customer Counters @ SSR Air Cargo

Open Concept Offices @ IKS Building ‘One Stop Shop’ @ Dragon House

“Single Window” Cargo Inspection Office at Port

Custom House

Fully Operational since December 2009

AUTOMATION - AUTOMATION - CMS/EDI: Continuous enhancement since 1998From 22 to 5 steps, minimal physical contact

officers/brokers, real time informationElectronic submission of cargo manifest, matching with

customs declarationsRates according to HS entered, automatic calculation, etc.Risk management module: Entry Selection/Selectivity

Criteria/identify risk factors - Green/Yellow/Red/Blue.Release of goods through message to freight stations.Transfer of FCL containers: automated transfer document.Epayment, E certificate of origin, Valuation database, Tariff

rulings, Integrated tariff, Import permitExternal Users: Ministries, VAT, Port Authority, Freeport,

Brokers , Freight Agents

Port AirportNuctech X-Ray ScannersNuctech X-Ray Scanners((operational since Feb 2006)operational since Feb 2006)

Training and Development Initiatives • Management Development , Project

Management , Investigative & Control Techniques, Risk Management

• Post clearance auditing• Laws & Regulations, Processes & Procedures• ICT & Integrity • Customer Care, Performance Management

System

Staff and Stakeholder Training Staff and Stakeholder Training

K9 Drug Detector DogsK9 Drug Detector Dogs

Year 2000/01

2001/02

2002/03

2003/04

2004/05

2005/06

2006/07

2007/08

2008/09

2nd ½ 09

Customs Duty (billions)

3.47 3.29 3.50 4.04 3.93 3.09 2.14 2.68 1.54 0.82

Excise Duty (billions)

4.99 4.90 5.36 5.75 6.79 6.72 7.33 7.90 12.11 4.62

VAT on Imports (billions)

3.42 4.07 5.65 6.34 7.68 8.47 9.45 11.45 8.51 6.17

Total duties and taxes (bilions)

11.88 12.26 14.51 16.13 18.40 18.28 18.92 22.03 22.16 11.61

2000/01 2001/02 2002/03 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 2nd ½ 090.00

5.00

10.00

15.00

20.00

Customs Duty

Excise Duty

VAT on Imports

Total duties and taxes3.47 3.29 3.504.04 3.93

3.092.14

2.681.54

0.82

4.99 4.90 5.36 5.756.79 6.72

7.337.90

12.11

4.623.424.07

5.656.34

7.688.47

9.45

11.45

8.51

6.17

11.88 12.26

14.51

16.13

18.40 18.2818.92

22.03 22.16

11.61

C us toms D uty

E x c is e D uty

VAT on Imports

Total duties and tax es

DUTIES AND TAXES COLLECTED BY CUSTOM S

2008 2009 2010red channel 18 16 17green/yellow channel 82 84 83

0

10

20

30

40

50

60

70

80

90

%

CHANNELING OF DECLARATIONS

IntegrityInternal Affairs & Internal Audit Divisions within

MRA2006: Customs Department awarded by ICAC the

Best Anti-Corruption Framework Award in the Public Service and the most improved public sector institution.

2010: Integrity Risk Assessment conducted for whole MRA: MRA awarded Best Anti-Corruption Framework & ranked first in Management Commitment and Integrity Management

Projects in the pipelineMauritius Trade Portal based on the Single

Window ConceptPaperless Customs Internal Appeal Mechanism & Prescribed

Administrative PenaltiesAccounts Manager.

End Note• In today’s world, the only constant is change - Need for

continuous improvement• For change to be sustainable - Need for trust and

commitment through leadership, employee participation, communication & motivation

• Comment from a change agent: ‘Customs reform is like pregnancy. It is often fun and easy to conceive, but delivery is long and painful.’