Customs Administrative Reform (CARE) project was initiated by the central Board of Revenue in February 2002 with the fundamental objective to improve organisational efficiency of customs department, enhance controls, and to enable it to adapt to emerging international initiatives requiring exchange of information among customs administrations.
CARE Team has endeavoured to achieve these objectives through (i) Business process re-engineering, to adopt international best practices, (ii) use of latest information technology tools, (iii) use of standardised protocols for information exchange (use of XML and WCO Data Model), and (iv) use of automated risk management techniques.
The system designed under CARE is called Pakistan Customs Computerised System (PACCS). Software application for the system has been developed by a consortium of three software companies Microsoft PWC Logistics and AOS, selected through World Bank's international tendering process.
SCOPE The scope of CARE project, as explained in the Concept Paper issued by CBR in April 2003 was to develop an end-to-end automated Customs system covering all Customs functions.
Due to very nature of Customs work, the system transcends its boundaries from Customs procedures to other relevant organisations concerned with clearance of international cargo, and various operators involved in the logistic supply chain, like banks, carriers, and warehouse operators etc.
These include port authorities, terminal operators, on-line branches of government treasury throughout the country, State Bank of Pakistan, regulatory ministries and departments like Ministry of Commerce quota authorities like Sales Tax department or Engineering Development Board, Export Promotion Bureau, Income Tax departments and CBR Headquarter, provincial excise departments, plant and animal quarantine departments and other regulatory authorities prescribed in various schemes.
THE SYSTEM CALLED PAKISTAN CUSTOMS COMPUTERIZES SYSTEM (PACCS) IS AN INTEGRATED SYSTEM WHICH HAS THE FOLLOWING CATEGORIES OF USERS:
-- Customs functionaries, at port of entry and port of destination or exit.
-- Traders (importers and exporters) including organisation who may import or export cargo like Government departments, municipal bodies, UN organisations, embassies and consulates.
-- Carriers (shipping lines, bonded carriers like NLC, railway and other authorised carriers).
-- Ports and terminal operators
-- Customs Clearing Agents
-- Bonded Warehouse Operators
-- Ship Chandlers
-- Quota authorities, Sales Tax Collectors (for DTRE and Survey form)
-- Regulatory authorities like Ministry of Commerce
-- Authorised online branches of treasury
-- State Bank of Pakistan
-- Federal Bureau of Statistics
-- Various other departments
-- Components of PACCS
PACCS COMPRISES OF FOUR ESSENTIAL COMPONENTS:
TARIP (TARIFF & INTEGRATED POLICY)
TARIP IS THE COMPLETE PICTURE OF REGULATIONS FOR IMPORT OR EXPORT OF CARGO TO & FROM PAKISTAN. THE STAKE-HOLDERS KNOW IN ADVANCE ABOUT:
-- The Import Tariff rates
-- The Export drawback rates
-- Complete details of Import & Export restrictions
-- Complete details of exemptions
-- Complete list of documentary requirements
-- Complete list of declaration requirements
-- TARIP is online. TARIP is always up-to-date (Information is captured at source)
B. INTRA (INTEGRATED REGULATORY AUTHORITIES)
INTRA is an online nation-wide network connecting all stakeholders involved in imports, exports and movement of cargo with PACCS. These include:
-- Government Ministries & Departments
-- Central Board of Revenue and its wings
-- All Customs Collectorates
-- All Sales Tax Collectorates
-- State and commercial banks
User Interfaces for all stakeholders are provided by this component. INTRA provides online registers and accounting to monitor quota regimes in export and imports.
C. ECHO (ENHANCED CARGO HANDLING & PORT OPTIMIZATION)
ECHO is online connectivity between the carriers, PACCS and Terminal Operators / Port authorities. ECHO provides the following advantages:
-- One electronic document for the carriers
-- Online inventory and monitoring of ports. No Customs staff at the gates (e-gates)
-- Seamless, Transits and Transshipments without Customs requirements
-- No requirement by Customs for Export manifest
-- Risk screening prior to arrival of the vessel, the terminal operator receives cargo handling instructions while offloading increasing his throughput at least three folds
-- Instant duty drawbacks with the sail of vessel
D. Access (automated customs clearance system)
ACCESS is the core Customs system which covers all Customs functioning through an automated risk-management based system covers the following.
-- Advanced Carrier declaration
-- Advanced screening for risky Cargo
-- Goods declaration with off line support
-- Payment Management System
-- Risk Management System
-- Assessment Management System
-- Clearance Management System
-- Status Reporting System
-- Law Cell
-- Adjudications
-- Auctions
-- Warehousing
-- Licensing
-- Transits and Transshipments
-- PACCS Salient Features
SALIENT FEATURES OF PACCS ARE FOLLOWING:
ONE WINDOW:
PACCS is a one window system. Traders can connect to PACCS over the web and carry out all their activities related to Customs from any where in the country. Whether one is importing or exporting all that one requires is a PACCS User ID, a computer and an internet connection.
24x7 System:
PACCS is a twenty four by seven system. With PACCS one can clear his cargo 365 days a year, day or night.
PAPERLESS ENVIRONMENT: PACCS is completely paperless. Traders or carriers do not have to file any documents to Customs, even Customs declarations (Goods Declarations, Cargo reporting, vessel information, repayment applications, etc) are all electronic and available online. Status notifications to traders and carriers are also electronic.
VIRTUAL SYSTEM: PACCS is independent of geography. Trader can import, export and conduct all other activity with Pakistan Customs from anywhere in the country. For instance, one can file his declaration over the web from his head office in a city, pay his duties through an online Bank from a field office in another district and get his goods cleared for a factory in some other city.
AUTOMATION: PACCS is completely automated. All declarations are processed by highly advanced Processing and Risk Management Systems. All information regarding receipt of request, clearance of cargo etc are delivered online to trader's inbox. In case any clarifications regarding a declaration are deemed necessary by Customs, the trader is intimated online.
SELF ASSESSMENT: Under PACCS, Customs does not interfere in the process of discharge of legal liabilities of duties and taxes. Trader computes and discharges his liabilities himself before submitting his declaration to Customs. On submission of the declaration he gets instant online receipt in the shape of Customs Reference Number (CRN).
ELECTRONIC PROCESSING OF DECLARATION: The moment a CRN is allotted, the Risk Management System commences the processing of your declaration. Our studies indicate that up to 80% of trade is by responsible and legitimate businesses and does not pose a threat to the country or the exchequer. In all such cases the cargo will be cleared and declarant is intimated online. The process takes less than 15 seconds. In case a threat is detected, detailed scrutiny including examination of cargo may be undertaken.
Pakistan Customs is committed to facilitate legitimate trade, in the interest of legitimate, we are equally committed to ensure that illegitimate trade is checked. Our processing systems are highly sophisticated and designed to detect and prevent illicit practices.
RISK MANAGEMENT: PACCS has a highly sophisticated automated Risk Management System. Under PACCS the international cargo flowing through our ports is not disturbed. Customs keeps a vigilant eye on the flow and intercepts only those consignments as are perceived to pose a threat to the country or its exchequer. Such instances are verified for compliance check and in case the threat is not real, cargo is expeditiously returned to its normal flow. Certain consignments may be verified on random basis.
NO UN-RECEIPTED EXPENSE: All processes of PACCS have been designed to ensure that the trade does not incur any un-receipted expense in clearance of the cargo. Every step of Customs clearance is documented and it is ensured that the tax collectors do not come into contact with the tax payers thus eliminating any chances of foul play. A transparent system gives Customs officials greater confidence in performance of their duties since they are protected against fictitious allegations of wrong doing.
INSTANT DUTY DRAWBACKS / REPAYMENTS: Under PACCS the Goods Declaration for exports (Shipping Bill) is in itself a request for duty drawback. PACCS is also linked with commercial banks and central bank (State Bank of Pakistan) whereby the banks can monitor status of export cargo and regulate flow of foreign exchange remittances. This linkage has reduced a lot of paper-work between shipper commercial banks and Customs.
In order to obtain repayments all a declarant has to do is to file a Goods Declaration to Customs, his due duty drawback on exports will be computed and sanctioned with the sailing of the vessel.
FUNCTIONAL MODULES OF PACCS: VARIOUS MODULES OF THE PACCS SOFTWARE APPLICATION, AND BRIEF FUNCTIONALITY OF EACH IS AS UNDER:
USER MANAGEMENT SYSTEM: It defines access level and authority of each persons interacting with the system.
GOODS DECLARATION SYSTEM: It defines various procedures for importers and exporters for Customs clearance. The procedures are commercial imports, non-commercial imports, re-imports and temporary imports, and likewise commercial exports, non-commercial exports, re-exports and temporary exports.
RISK MANAGEMENT SYSTEM: It is an automated system which targets various risk in different areas and trigger actions according to prescribed parameters and procedures. It covers various areas like assessments, examinations, lab tests, drug check, assessment, post-release verification, warehouse inspections etc.
PAYMENT MANAGEMENT SYSTEM: It connects authorised on-line branches of treasury throughout the country with PACCS.
ASSESSMENT MANAGEMENT SYSTEM: This system performs automated computation of all duties and taxes on the basis of pre-defined formulas taking into account exemption regimes and procedure adopted by the importer or exporter as per self-assessment of the declarant, or if intervened by Custom for compliance check, as per Customs determination.
CARRIER DECLARATION SYSTEM: It provides facility to carriers and their agents to interact with PACCS, file and amend their manifests on-line. Port clearance to incoming and outgoing vessels is granted without physical documents, online.
EDI WITH PORT: It is connectivity with port whereby Customs authorised port to receive any cargo, release any cargo or to perform various actions on cargo as per Customs requirement like grounding and arranging cargo for examination. The events of vessel arrival, cargo discharge, gate-out and arrangements for inspections and vessel sail out are communicated by Terminal Operator to Customs through an automated mechanism through this system.
CLEARANCE MANAGEMENT SYSTEM: It release or hold import and export cargo on the basis of pre-defined outcomes of various system. Trigger and flags from Risk Managements System, assessments, examinations, position of cargo whether arrived or not, payments of duties and taxes, furnishing of securities and documents where necessary, and based on these co-ordinates various activities.
EXAMINATIONS MANAGE-MENT SYSTEM: It allocates resources to and records data from Customs activities at port, like inspections, weight check, drug check or lab testing.
ADJUDICATIONS MANAGE-MENT SYSTEM: It covers contraventions, issuance of electronic hearing notices, preparation of contravention reports, issuance of Orders-in-Original, and management of cases pending before various appellate for a.
REFUND MANAGEMENT SYSTEM: It covers refunds of Customs duties. It automatically triggers events where excess payments is made and initiates refund procedure, and also provide facility to traders to lodge their claims.
DUTY DRAWBACKS ON EXPORTS: It covers assessment, sanction and payment of duty drawbacks on export.
WAREHOUSING MANAGEMENT SYSTEM: It covers removal of goods from a Customs controlled area to warehouse, receipt of goods at the warehouse, maintenance of complete item-wise can consignment-wise balance of non-duty paid goods in warehouse, triggers ex-bond procedures on expiry of warehousing procedures, computation of surcharge and penalties on over-stayed goods. It also triggers warehouse inspection based on automated risk Managements system.
TARIFF MANAGEMENT: It provides Customs, Sales Tax, Excise and Direct Tax headquarters to maintain and amend or impose duty rates on any commodity on-line. Changes are made directly from source and instantly implemented by system as defined.
EXEMPTION MANAGEMENT: It provides for prescribing exemption schemes by the concerned authorities in CBR headquarters.
VALUATION: It refers valuation disputes from clearance formation to Valuation Department. Valuation departments can manage its tasks on the system, and enter its decisions directly into the system.
POST RELEASE VERIFICATIONS: It triggers post-release verifications based on risk-Managements system.
CLASSIFICATION COMMITTEE: It refers classification disputes to Classification Center of the CBR. Classification center can manage its task on the system and enter its decisions on-line into PACCS.
RECOVERIES: It provides Managements of recoveries as per Customs Recovery Rules. Automated triggers and notices at prescribed events are generated. System keeps track of each case.
LICENSING: It provides facility to Customs for issuance, renewal, cancellation, training and testing of Customs agents.
TRANSITS MANAGEMENT SYSTEM: It connects all Customs stations and communicates information of transit cargo from port of dispatch to port of destination and exit. Communication of data of in-land up-country transits and Afghan Transit is managed through this system.
QUOTA MANAGEMENT: It provides facility to relevant authorities to issue quota and monitor it, and provides a mechanism of debiting through clearance events. DTRE, S-form quotas are managed through this system.
TAX NODE SYSTEM: This system connects NTN database and STRN database with Customs System.
IMPLEMENTATION STRATEGY: As an established practice to launch an extensive multi-organisational system of this nature and magnitude, the CBR decided to implement it is phases. CARE Pilot Project is the first phase through which all components of the system have been put in place. However, it is limited by geography, at Karachi International Container Terminal (KICTL) which deals with about one-third of import and export cargo cleared through Karachi Port.
In terms of functionally, PACCS covers all Customs procedures, all modes of transport land, air, sea and multi-modal, and all types of cargo, containerised, LCL or bulk.
ACHIEVEMENTS: PACCS was inaugurated on 18th April 2005. It is successfully delivering its objectives.
CUSTOMS EFFICIENCY AND PORT'S THROUGHPUT HAS PHENOMENALLY INCREASED:
-- Reduction in Steps in import clearance
26 Steps - 01 Step
-- Reduction in Customs Processing Time
04 days - 08 Hrs
(more than 60% consignments are cleared within 1 hour)
-- Reduction in Dwell Time of Cargo at port
-- 11 days - 05 days
-- PACCS will be rolled out throughout the country.
-- Michel Danet
-- Secretary General
-- World Customs Organisation
-- M. Jayaraman Chairman & Special Secretary, Central Board of Excise & Customs (CBEC)
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