Influence of the Customs Activities on the Port Competitiveness
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Abstract
Globalization and liberalization of trade, complexity of transport services and growth of e-trade have raised new tasks for the customs administrations recently. Transportation costs, legal environment, easy access to information, clear-cut process, including inspections at the border control posts with participation of various institutions – all this play an important role in development of a competitive business advantage and new possibilities. It is very important for the customs to get integrated into this process; otherwise it shall become an obstacle in a chain of logistics. However, there is a problem in finding solutions between it seems so two conflicting goals, i.e. it is important to ensure an effective control and at the same time to create favorable conditions for development of a legal business.
Factors having influence on a flow of transport and existing of shipping routes. Most often scientific literature distinguishes the following factors influencing the flow of cargoes and at the same time attractiveness of the port: time and price of cargo transportation, economy of human resources, quality and variety of services, legal environment, i.e. variation of laws or other legislative acts, geographic location, port infrastructure and the factor of a secure (reliable) port, i.e. it is important to transport the cargo not only at a low cost and in a short time, but also safely.
Influence of the customs on the port activities. Customs is one of the state institutions of the Republic of Lithuania in charge for implementation of respective marine law standards and documents, laws in its competence and other legal acts related to import, export and transit, and collection of taxes. It has a direct influence on the process of transportation of cargoes through the port and on activities of the port companies. It has an influence on time and price cargo transportation, economy of human resources, quality and variety of services and port safety. After analysis and evaluation of all the above factors, it developed that the factor of time has a great influence on other factors (price of cargo, economy of human resources, etc.).
Supervision by the customs starts with the ship’s mooring at the quay and ends with shipping the goods out of the port territory. This process is made of several stages with direct participation by the customs. From the moment of taking the goods into the port, all the time they stay there they are under supervision of the customs. The customs control of the goods in the marine port is carried out in 4 stages: stage I – customs inspection of a ship; stage II – temporary storage, stage III – customs declaration and inspection, and stage IV – shipping the goods out of the port.
After analysis of the stages of customs control, it was discovered that 70% of all the time of the customs processes is needed for risk evaluation. We can not eliminate the risk evaluation from the customs processes, because it may diminish the effectiveness of the customs control. However, the risk may be evaluated prior to the ship entering the port, in this way reducing the time the goods stay in the port. All this requires having information on the goods shipped in advance. After evaluation of risk the customs would have a possibility to decide in advance whether to give permission for unloading of goods and whether to inspect the ship, cargo or documents.
Having evaluated the risk in advance (prior to the ship entering the port) and giving a permission to start unloading operations beforehand, the customs would allow the loading companies to have all the necessary equipment for loading operations be ready and prepared, the forwarders would have necessary documents ready for declaration of goods, ordering transport, etc. Having a permission to unload the ship beforehand, the business would save about 30-60 minutes for one ship.
Using the advance electronic declaration, the customs gets a possibility to evaluate the risk of each consignment of goods declared prior to them being presented to the customs, thus processing of the customs documents is reduced in time significantly. It is obvious that such factors make the customs activities much effective.
One of the most relevant issues at the present is a development of Klaipėda state sea port information system. Electronic data exchange between the business and customs and an advance electronic declaration improve conditions for business and stimulate development of an international trade. Another major factor having a fair influence on the quality of customs procedures is equipping the customs posts and providing them with modern computer, communication and special customs inspection equipment and locations for in-depth inspections. Inspecting the goods with modern x-ray equipment, inspection time is reduced to the minimum. On the other hand, the customs must pay a great attention to creation of legal basis, training of qualified personnel and maintaining close cooperation with other institutions, business sector, etc. Inflexibility of the customs having a direct influence on all the process of cargo transportation may have a negative effect on the port competitiveness.
This article is an incomplete scientific research. Analysis allows a presumption that from the first sight two conflicting goals – to ensure an effective control and to create favorable conditions for development of a legal business – are actually compatible. This problem is to be solved using scientific and IT possibilities.
Another task of the article is to attract the attention of academic community towards very important spheres of activities of Klaipėda Territorial Customs and issues of port service and to encourage analysis of the customs influence on all factors determining the port competitiveness, forming principles and creation of a theoretical framework for organization of the modern customs activities.
Factors having influence on a flow of transport and existing of shipping routes. Most often scientific literature distinguishes the following factors influencing the flow of cargoes and at the same time attractiveness of the port: time and price of cargo transportation, economy of human resources, quality and variety of services, legal environment, i.e. variation of laws or other legislative acts, geographic location, port infrastructure and the factor of a secure (reliable) port, i.e. it is important to transport the cargo not only at a low cost and in a short time, but also safely.
Influence of the customs on the port activities. Customs is one of the state institutions of the Republic of Lithuania in charge for implementation of respective marine law standards and documents, laws in its competence and other legal acts related to import, export and transit, and collection of taxes. It has a direct influence on the process of transportation of cargoes through the port and on activities of the port companies. It has an influence on time and price cargo transportation, economy of human resources, quality and variety of services and port safety. After analysis and evaluation of all the above factors, it developed that the factor of time has a great influence on other factors (price of cargo, economy of human resources, etc.).
Supervision by the customs starts with the ship’s mooring at the quay and ends with shipping the goods out of the port territory. This process is made of several stages with direct participation by the customs. From the moment of taking the goods into the port, all the time they stay there they are under supervision of the customs. The customs control of the goods in the marine port is carried out in 4 stages: stage I – customs inspection of a ship; stage II – temporary storage, stage III – customs declaration and inspection, and stage IV – shipping the goods out of the port.
After analysis of the stages of customs control, it was discovered that 70% of all the time of the customs processes is needed for risk evaluation. We can not eliminate the risk evaluation from the customs processes, because it may diminish the effectiveness of the customs control. However, the risk may be evaluated prior to the ship entering the port, in this way reducing the time the goods stay in the port. All this requires having information on the goods shipped in advance. After evaluation of risk the customs would have a possibility to decide in advance whether to give permission for unloading of goods and whether to inspect the ship, cargo or documents.
Having evaluated the risk in advance (prior to the ship entering the port) and giving a permission to start unloading operations beforehand, the customs would allow the loading companies to have all the necessary equipment for loading operations be ready and prepared, the forwarders would have necessary documents ready for declaration of goods, ordering transport, etc. Having a permission to unload the ship beforehand, the business would save about 30-60 minutes for one ship.
Using the advance electronic declaration, the customs gets a possibility to evaluate the risk of each consignment of goods declared prior to them being presented to the customs, thus processing of the customs documents is reduced in time significantly. It is obvious that such factors make the customs activities much effective.
One of the most relevant issues at the present is a development of Klaipėda state sea port information system. Electronic data exchange between the business and customs and an advance electronic declaration improve conditions for business and stimulate development of an international trade. Another major factor having a fair influence on the quality of customs procedures is equipping the customs posts and providing them with modern computer, communication and special customs inspection equipment and locations for in-depth inspections. Inspecting the goods with modern x-ray equipment, inspection time is reduced to the minimum. On the other hand, the customs must pay a great attention to creation of legal basis, training of qualified personnel and maintaining close cooperation with other institutions, business sector, etc. Inflexibility of the customs having a direct influence on all the process of cargo transportation may have a negative effect on the port competitiveness.
This article is an incomplete scientific research. Analysis allows a presumption that from the first sight two conflicting goals – to ensure an effective control and to create favorable conditions for development of a legal business – are actually compatible. This problem is to be solved using scientific and IT possibilities.
Another task of the article is to attract the attention of academic community towards very important spheres of activities of Klaipėda Territorial Customs and issues of port service and to encourage analysis of the customs influence on all factors determining the port competitiveness, forming principles and creation of a theoretical framework for organization of the modern customs activities.
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Please see Copyright and Licence Agreement for further details.
