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STREAMLINING AND AUTOMATING PROCEDURES FOR AGRIFOOD TRADE

Francis Norman Lopez

Streamlining and Automa1ng Procedures for AgriFood Trade

Agenda

•  Import and Export Processes in AgriFood Trade

•  SPS Exchange

•  Facilitating Trade of AgriFood with the Single Window

•  Case Study: Philippines

Typical AgriFood Supply Chain*

* Informa1on Management in AgriFood Chain: Towards an Integrated Paperless Framework for AgriFood Trade Facilita1on

Collabora7on in Trade •  Iden1fiers: AEOs, Product Codes •  Compliance to import requirements •  Visibility across the Supply Chain

Case Studies •  India GrapeNet • Malaysia Food and Traceability • Vietnam TraceVerified for Fish Exports • New Zealand eCert for Meat Products

Case Studies • US ITDS –GS1 • China eCert, GPS and RFID

Transport •  Air, Sea and Land

Case Studies •  Export

–  India GrapeNet – Malaysia Food and Traceability –  Vietnam TraceVerified for Fish Exports

–  New Zealand eCert for Meat Products

•  Import –  China Tianjin eCert, GPS-‐RFID –  US ITDS –  Philippines

•  Key Success Factors –  Iden1fica1on of source and products –  Specific tes1ng procedures –  Export-‐Import collabora1on to ensure Cer1fica1on for compliance to import regulatory requirements

–  Accessibility of data for transparency, monitoring and reports

–  Government support, possibly with funding, for sustainability

–  Tangible benefits to government and the private sector

–  Cost effec1ve technical solu1on

Key Documents in AgriFood Trade Exports •  Trade Documents

-  Commodity clearance, e.g., palm/coconut oil, sugar

-  SPS Cer7ficate (Health, Veterinary, Phyto Cer7ficate)

-  Catch Cer1ficates (EU IUU Regula1ons) -  Halal Cer1ficate (Moslem countries) -  Fumiga1on Cer1ficate -  Export Declara1on -  Cer1ficate of Origin

•  Supply Chain Documents -  Invoice -  ASN/Packing List

•  Transport Documents -  Advanced Manifest

-  AWB/BL

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Imports •  Trade Documents

-  Import Permit (eg SPS Import Clearance) -  SPS Cer7ficate (Health, Veterinary, Phyto Cer7ficate) -  MAV Import Cer1ficate (Safeguard Measure) -  Request for Inspec1on -  Veterinary Quaran1ne, Meat Inspec1on and Laboratory Cer1ficate

-  Cer1ficate of Meat Inspec1on -  Import Declara1on -  Cer1ficate of Origin

•  Supply Chain Documents -  Purchase Order -  Invoice -  ASN/Packing List

•  Transport Documents -  Advanced Manifest -  AWB/BL

SPS Cer1ficate •  Sanitary and Phytosanitary Certificate

-  WTO SPS Agreement

-  International Plant Protection Council (IPPC) and the International Plant Sanitary Measures No.12 (IPSM)

-  CODEX Alimentarius Commission/OIE

•  Issuance of SPS Certificate

-  Harmonise SPS measures, based on international standards, guidelines and recommendations

-  Safeguard international trade of plants, animals and fisheries and products thereof

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SPS Cer1fica1on Workflow

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e-‐SPS Cer1fica1on •  Definition

-  A secure exchange of SPS / eCert Messages from Issuing Authority (Export) to Quarantine Authority/National Plant Protection Organisation -NPPO (Import)

•  Objectives -  Ensure compliance to health, sanitary requirements of exporting and

importing country -  Facilitate compliance and control fraud -  Trade facilitation, cross border efficiencies with advanced

information, reusable data

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e-‐SPS Features

•  Government-to-Government (G2G) Exchange

•  Equivalent to paper SPS

•  Prior Notice - available prior to arrival

•  Initiate pre-clearance processes

•  Verification of paper SPS Certificate

•  Reusable SPS data - traders, products

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E-‐SPS Workflow

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E-‐SPS Ini1a1ves

•  IPPC IPSM No 12 - ePhyto Certificate

•  AU DAFF e-CERT

•  US ITDS GS1

•  APEC ECSG SPS

•  PAA e-SPS

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IPPC ISPM No.12 : e-‐Phyto •  Definition

-  It is the electronic transmission of phytosanitary certificate information (electronic equivalent of a paper phytosanitary certificate), containing the same information and giving the same guarantee.

•  Key Elements -  Message format -  Harmonisation of message contents (as prescribed in

ISPM12) -  Secure transmission -  Authenticity of the message

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IPPC: International Plant Protection Convention ISPM: International Standards for Phytosanitary Measures

IPPC ISPM No12 ePhyto Cer1ficate •  E-Phyto is NOT a “copy” of the Phyto Certificate

•  A secured data set conforming to the ISPM12, transmitted securely from exporting to importing National Plant Protection Office (NPPO)

•  Equivalent to a paper Phytosanitary Certificate, and may be used only if accepted by the importing NPPO

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IPPS ISPM No 12 ePhyto •  Electronic Certificate may be issued where accepted by the

National Plant Protection Office (NPPO) of the importing country

•  Specific required provisions -  The mode of issue, transmission and level of security is acceptable to the NPPO of

the importing country

-  Information provided is consistent with the IPPC Model Phytosanitary Certificates

-  The purpose of the phytosanitary certification under the IPPC is realized

-  The identity of the issuing NPPO can be adequately established and authenticated

•  Available to the relevant NPPO upon consignment arrival

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e-‐Phyto Cer1fica1on is NOT .. •  Text processing or other electronic generation of paper

forms (eg. SPS or Phyto Certificate)

•  Transfer of electronic version of a paper certificate (e.g. Certificate in pdf)

•  On-line data entry [by exporting authority] in system of importing country

•  National electronic system to facilitate phytosanitary certification

•  National system to facilitate phytosanitary import process through inspections

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. . Nico Horn on behalf of the IPPC ePhyto Steering Committee

IPPC e-Phyto http://ephyto.ippc.int/!

IPPC e-‐Phyto Work Groups

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•  XML Schema - UN/CEFACT Standards, Schema, Codes - Data mapping - Handling mixed consignments

•  Code List - Description of consignments -  Standards list: Country ISO Codes, Bayer

Codes, EPPO Codes : List of Plants and Plant Pest

-  Botanical names -  Treatments - Additional declarations -  Product descriptions: categories, sub-class

•  Communication Protocols - Methods of transfer, security measures,

validation

•  EWG Participants, Sept 2012 Paris

-  Steering Committee - D Howell, IPPC Secretariat - R Lee, NAPPO - P Johnston, New Zealand - Nico Horn, Netherlands

- WG1 Coordinator: M Boerma

- WG3 Coordinator: M Perry

-  Invited Experts: - B Cooper, Australia - S Kirkpatrick, Canada - M Chen, China - D Frez, Chile - K Kaminski, Germany - L Moret, Netherlands - L Venter-Wagner, New Zealand - S Jun, S Korea

Agreed Principles and Recommenda1ons for the e-‐Phyto Exchange

1.  Agreement on definition of e-Phyto Certification 2.  All elements for e-Phyto Certification exchange mechanism

will be derived from IPSM 12 3.  Universally accepted standards for secure Certificate

exchange, message format and implementation of procedures will be used

4.  UN/CEFACT Schema (data elements, core components) must be reviewed to ensure consistency with IPSM 12 requirements, and a user guide developed to include an ‘IPSM12 Overlay for the UN/CEFACT Schema’

18 . . 9 Points Summary on Key Agreements during the Plenary of the 3-day Workshop

Agreed Principles and Recommenda1ons for the e-‐Phyto Exchange

5.  During transition periods in implementation, current hard-copy practices would still apply

6.  Rely on IT experts to provide advise on methods for flexible and secure electronic transfer

7.  Initiate a multilateral standardization approach rather than a bilateral approach with respect to country-to-country negotiations for exchange

8.  Engage developing countries through regional cooperation and pilot projects and use IPPC for outreach activities, and

9.  Develop simple-to-understand communication pieces such as Background Paper and “Myth-busting” Question and Answers

19 . . 9 Points Summary on Key Agreements during the Plenary of the 3-day Workshop

IPPC e-‐Phyto Hub

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HUB

Current Point-‐to-‐Point Model Proposed e-‐Phyto Hub Model

AU DAFF AU DAFF NZ MPI

NPPO NPPO

NPPO NPPO IPPC Proposal

NZ MPI

NPPO NPPO

NPPO NPPO

• Mul1ple data standards used •  Time and cost spent in implemen1ng bilateral connec1vity and exchange of e-‐Phyto Cer1ficates

•  Single data standard used and maintained, in sending and receiving e-‐Phyto Cer1ficates

• One-‐1me set up to connect to the e-‐Phyto Hub

Australia DAFF e-‐Cert •  E-Cert Website (https://apps.daff.gov.au/ecert/default/Welcome.aspx)

-  DAFF Biosecurity Internet application for electronic certification of traded food and agricultural commodities. This application currently provides electronic certification for Australian exports of Meat, Skins, Fish, Dairy, Horticulture, Grains, Wool, Eggs and Inedible Meat

-  Online search/view of Export/SPS/Health Certificates

-  Allows updates on Certificate status: Accepted, Detained or Request for Replacement

-  Allows download of Certificates in XML format (10k)

•  Alternative Access Mode to E-Cert Data -  Pull data from AQIS via interaction with SOAP interface

-  Push data to Import/Quarantine Authority via SMTP and digital certificates

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US ITDS GS1 Pilot E-‐Cert •  Toys, Cut flowers, Meat and Poultry

•  Global eCommerce Product Catalog -  Granularity of product identification

-  Product visibility across borders

-  Consumer security

-  Cost savings

•  Compliance to unique country-by-country, product-by-product requirements

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Use of GS1 Standards in SCM

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GS1 Standards

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•  Global Location Number (GLN)

•  Global Trade Identification Number (GTIN)

•  Global Data Synchonization Network (GDSN)

US ITDS GSW Pilot E-‐Cert Findings •  100% of the 21 static characteristics assigned to

identify and classify meat and poultry products could be downloaded from a GS1 GDSN-compliant catalog

•  No information technology or security obstacles, enable re-use of supplier published product information, with complex product characterisation

•  Improved data accuracy and efficiencies (i.e. reduce product characterisation errors)

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PAA eSPS Exchange Model

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PAA E-‐SPS Exchange

PAA e-‐SPS with Advanced Import Permit

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PAA e-‐SPS with One SP

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PAA E-‐SPS Exchange

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•  e-SPS exchange, with Service Provider

•  eSPS with advanced import permit exchange, with Service Provider

•  eSPS with advanced import permit exchange, with Service Provider on one country

Take Aways from e-‐SPS Ini1a1ves

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•  Initiatives on e-SPS aims to facilitate exports, ensure compliance to import requirements and mitigate fraud

•  Evolving e-SPS data standards to enhance risk management and traceability, and workflows to facilitate e-SPS Exchange

•  Need to align new initiatives e.g., SWAT, ASW e-SPS Exchange, e-Phyto Hub, etc.

Group Exercise

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•  What is the current state of SPS in each country ?

-  Manual processes, paper-based application, approval and issuance of SPS Certificate; or, Automated or on-going project to automate the SPS process

-  Online access or receipt of e-SPS from issuing authority; Facilitate import quarantine clearance with the use of advanced e-SPS

•  What are possible barriers to e-SPS Exchange ? -  Management awareness or appreciation of global trends

-  Legal or administrative restrictions, requiring enactment of laws, policy issuances and directives

-  IT infrastructure (availability, reliability and cost)

-  Internal IT capabilities

-  Resistance to change

Challenges in Paper-‐based Processes

•  Hardcopy documents -  Daily volume of documents submitted

-  Accuracy, consistency of information

•  Manual intervention in the review, processing and approval -  Clerical errors in review

-  Human intervention in the approval processes

-  Data re-entry to generate reports

•  Transparency -  Data visibility, documents in ‘filing cabinets’

-  Accountability

-  Limited data analysis

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Trade Automa1on Models

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•  Single Agency

-  Single/Multiple documents

-  Internal processes

•  Single Window

-  Multi-Agency, Multi-Documents

•  Multiple Systems e.g. Inter-Organization Information Systems (IOIS)

Methodologies

•  Business process modelling -  Understanding workflows and roles of stakeholders

-  Eliminating ‘defects’ in the processes i.e. causing delays or cost

•  Document/message and data standardisation -  Adopting standards or harmonising data messages, specifications

-  Enable interoperable systems

•  Modular implementation -  Designing the complete workflow/process

-  Developing and implementing critical module to generate impact on the complete process

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Ra1onale for Automa1on

•  Volume of transactions being processed manually

•  Repetitive processes

•  Need to reduce processing cycle time

•  Incidence of clerical errors

•  Compliance to requirements - internal, external

•  Accessibility of information, reports

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Challenges

•  Largely manual SPS processes (export and import)

•  Current automation focus on internal processes and requirements, on the NSW (import)

•  Receipt/access to e-SPS Certificate mainly to authenticate paper SPS Certificate (control fraud)

•  Compliance of SPS Certificate to import requirements

•  Current legal, policy framework does not provide SPS exchange

•  Agency technical readiness, capabilities

•  Multiple message standards used

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Implemen1ng e-‐SPS to Facilitate Trade

•  G2G exchange of e-SPS - in parallel to paper and/or B2B electronic exchange between exporter and importer

•  G2G or G2B2B2G exchange of Import Permit/SPS Import Clearance

•  Pilot with countries that are ready and capable to electronically send and/or receive e-SPS Certificate; agree on pilot commodities

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PH Agri Trade System: Background •  From 2002 to 2008, the Department of Agriculture (DA) had several attempts to

automate their processes;

•  Executive Order no. 482 dated 27 December 2005, creating the National Single Window Task Force

•  In 2007, initial implementation of the PNSW using the Licensing and Clearance System of ASYCUDA

•  In 2008, the DA issued directive harmonizing the import procedures of 3 agencies i.e. the Bureau of Animal Industry (BAI), the Bureau of Fisheries and Aquatic Resources (BFAR) and the Bureau of Plant Industry (BPI) – The Proposal BIMP-EAGA Pilot electronic Cross Border Information Project led to the

proposal to automate the SPS Import Clearance Precedures for the 3 DA Agencies

•  In 2009, Pilot Implementation of the SPS Import Clearance

•  In 2010, mandatory implementation of SPS Import Clearance and subsequently followed by the MAV/MAV Import Certificate, Request for Inspection (1st Border) and Veterinary Quarantine, Meat Inspection and Laboratory Certificate

PH Agri Import Procedures – before 2010

•  Centralized manual processes done at Head Offices, in Metro Manila – Accreditation/registration of importers and cold storage warehouse – Submission of application, processing and approval of SPS Import Clearance (SPS/

IC) – Minimum Access Volume (MAV) allocation and issuance of MAV Import

Certificate – Request for transfer of delivery of imported meat products to another cold

storage warehouse – Manually accomplished (hand written) Request for Inspection and issuance of the

Veterinary Quarantine, Meat Inspection and Laboratory Certificate and Inspection Report (including verification of SPS Certificates and other import documents)

•  Consider 3,400 importers of agri products, average 500 import shipments daily in 57 international ports, with 200 cold storage warehouses

Challenges in Manual Processes

•  Qualifying importers, suppliers and exporters for accredita1on and registra1on •  Iden1fica1on and classifica1on of commodi1es, products •  Document submission, verifica1on, authen1ca1on and storage

1. Cer1ficate of Product Registra1on 2. SPS Import Clearance 3. MAV Alloca1on and Import Cer1ficate 4. SPS Cer1ficates eg Health and Phyto Cer1ficates 5. Commercial Invoice 6. AWB/BL 7. Import Declara1on 8. Port Quaran1ne Inspec1on Report/VQMILC 9. Cer1ficate of Meat Inspec1on

•  Collec1on/payment of fees and issuance of receipts •  Monitoring transport and cargo handling •  Traceability from source to consumer •  Profiling and Risk Management •  Genera1ng 1mely and accurate sta1s1cs

Dept of Agriculture

BAI BFAR BPI

Regional Ofcs

Regional Ofcs

Regional Ofcs

Quaran1ne Ofc at Ports



Regulated Commodi1es, Products •  Bureau of Animal Industry (BAI)

–  Live Animals, for breeding and as pets –  Animal Product and By-‐Products, eg. Beef, Port, Chicken and other Meat Products

–  Feed and Feed ingredients, Supplements

–  Veterinary Drugs, Addi1ves, Supplements

•  Bureau of Fisheries and Aqua7c Resources (BFAR) –  Live Fish –  Fresh/Frozen Products

•  Na7onal Meat Inspec7on Service – Meat and Meat Products

•  Bureau of Plant Industry (BPI) –  Plant, including ornamentals –  Plant Products eg flowers, grains, fruits and vegetables

–  Plan1ng Materials

Issues Encountered

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•  Prior initiatives failed, agencies and IT team were skeptical of success; budget for the project was exhausted

•  Engagement of a Service Provider, fee for service paid by transacting parties

•  Limited IT infrastructure, proficiency and support •  Initial scope was limited to import permit (SPS Import

Clearance); accounting/audit issues on e-payment of agency fees

•  Delays in the approval, issuance of directives implementing guidelines

•  Deferred implementation by agencies

Lessons Learned

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•  Top management support, and middle management as project champions, is key to successful implementation

•  IT domain knowledge, with flexibility to overcome technical and business barriers

•  Substantial benefits (reduced cycle time, availability, reliability, predictability and cost savings) to garner industry/stakeholders support

•  Public-private partnership, collaboration is possible

Customs and Quaran1ne Clearance Invoice,

Packing List Pre-Alert AWB/BL

SPS SAD

Lodge

Manual Assess

FAN

Auto Assess

AWB/BL

Start

VASP

AAB

NSW

PASS5 Examine

OLRS

Online Prepara7on

Electronic Submission

BAI Review, Payment,

Processing & Approval

Prin7ng of Approved SPS

Import Clearance

Quaran7ne Inspec7on

RFI

• SPS Import Clearance • MAV Import Cer1ficate • SPS/Phyto Cer1ficate • Import Entry Declara1on SAD • Commercial Invoice • Packing List • Bill of Lading/AWB

VQMILC NMIS Meat

Inspec7on End

PH Import Workflow

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Import Processes and Traceability

Agriculture Trade System IOIS, Data Pipeline

AgriFood Supply Chain Primary Producer

Retail

Permit Apln SPS IC SPS Cert RFI VQMILC COMI LTP

ProForma Invoice

PO Comfirmattion

SPS Certification

Transport, Customs Data

Quarantine Inspection

Delivery

Source Supplier Products Quan1ty

Importer CSW

SPS IC No, Validity

Import Req

Exporter, Products

SPS Cer1fica1on

Shipper, Consignee, Meat Est No.,

Shipping Data (AWB/BL)),

Invoice Data Products/HSCode

SPS Ref No

Port Quaran1ne Inspec1on

Report

Meat Inspec1on, Laboratory Cer1fica1on

Meat Cer1fica1on, Products Des1na1on

PH E-‐SPS Exchange

•  Issuance and transmission of SPS Cer1ficates •  Receipt of SPS Cer1ficate and ensuring compliance

to import quaran1ne requirements

KR

NZ

AU SP/ TS

AU DAFF in 2007

BAI BFAR

BPI

BAI

DA Trade System 2014

Online Access to DAFF SPS eCert

NPPO/QIA

Exporting Country

Importing Country

NPPO/QIA SPS Certificate

Exporter Importer

SPS Import Clearance Application, Approval

SPS Notice

SPS Import Clearance/Permit

SPS Status/Change Request

SPS Certificate Application, Issuance

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4

3

2

E-‐SPS Exchange Model*

* Pan Asian eCommerce Alliance Model

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4

PH E-‐SPS Exchange Model

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Proposed PH E-‐SPS and the ASW

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IPPC e-‐Phyto Hub

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HUB

Current Point-‐to-‐Point Model Proposed e-‐Phyto Hub Model


NPPO NPPO


NZ MPI

NPPO NPPO

NPPO NPPO

• Mul1ple data standards used •  Time and cost spent in implemen1ng bilateral connec1vity and exchange of e-‐Phyto Cer1ficates

•  Single data standard used and maintained, in sending and receiving e-‐Phyto Cer1ficates

• One-‐1me set up to connect to the e-‐Phyto Hub

A S W Gateways

PH E-‐SPS and IPPC/ASW

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HUB

Point-‐to-‐Point Model Proposed e-‐Phyto Hub Model

BAI

BFAR

BPI


NPPO NPPO


NSW

NPPO

On-‐going tests with DAFF on the receipt of the SPS Cert

Proposed pilot test on the receipt of the SPS Cert from ID, MY, TH

PNSW DA

Trade System

Moving towards e-‐SPS

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1.  Generate awareness and muster support from top management, highlighting

-  Need to comply to AgriFood Trade requirements

-  Improved cycle time and reduced costs

-  Access real-time information

2.  Review of current policies, guidelines and procedures -  Applicable e-Commerce Law -  Amendment of current procedures to allow electronic submission

and processing of documents -  Harmonise forms, adopting standard message, data and codes

4.  Assess technical and funding requirements, and internal IT capabilities, competencies -  Development of an IT Plan, with implementation in stages to achieve

early success and change management