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Customs Risk Management PPT.Presentation
- 1. Customs Risk Management Thegreatest risk to our operations is not thinking about risk at every opportunity March 16, 2017
- 2. What is Risk Riskis the chance of an event occurring, which may have a negative impact on any activity or process and may affect the mandate of Customs. It can affect compliance with Customs mandate
- 3. What is RiskManagement? Risk Management is logical and systematic method to identify, analyze, treat and monitor risks involved in any activity or process Risk Management is a methodology that helps managers make best use of their available resources
- 4. The Idea ofRisk Management How do we translate treaty obligations and policy decisions into practical ‘on the ground’ changes that enhance revenue, facilitate trade and create business atmosphere with a level playing field?
- 5. Main Conventions TheHarmonized System (HS) - 1988 The WTO General Agreement on Tariffs and Trade (GATT, 1948) The Revised Kyoto Convention (2006) The Arusha Declaration (Revised, 2003) The WCO Framework of Standards to Secure and Facilitate Global Trade (SAFE, 2006) WTO Bali Trade Facilitation Agreement (2014
- 6. Who Uses RiskManagement? Risk Management practices are widely used in public and the private sectors, covering a wide range of activities or operations including: Finance and Investment Insurance Health Care Public Institutions Governments Project Management
- 7. Risk Management inCustoms Customs primary objectives are to collect and improve revenue, facilitate trade in the most secured manner, and effectively control smuggling without delaying clearance processes. Provide facilitation while maintaining control over legitimate international movement of goods RMU assist BCED in matching priorities to available resources.
- 8. Why Risk Management? We have limited resources We cannot be everywhere at once, we cannot do everything There is a greater volume of international trade – more than there has ever been in the past Customs cannot search everything – they do not have the people, the skills or the time and money. Not all taxpayers can be queried or scrutinized. And, importantly …. We should not scrutinize everything – most traders are honest, we should help them, not hinder them – to promote compliance
- 9. ASYCUDA and Risk Management Declaration process:- Basis of Customs control Information can be used for many other control functions. Selectivity:- Stopping declaration or directing it to a specific section Choosing transactions that are perceived to be of more Customs interest.
- 10. Responsibility of RMTeam Research and identify major risks Analyze risks to determine likelihood, consequences and levels of perceived risk Evaluate and prioritize the risks Take steps to counter the risks, including creation of selection criteria Monitor results, review the risks and update control measures accordingly Regular reporting to senior management
- 11. Components of Risk Probability– the chance that a loss will occur Consequence – the magnitude of the loss Perception – the significance of the loss as it relates to the basic objectives of an organization
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- 13. Risk Identification Definingthe type of risk Identifying the stakeholders(i.e. who is involved) Past events, future development
- 14. Analyze the Risks How likely is the risk event to happened? (Probability and frequency?) What would be the impact, cost or consequences of that event occurring? (Economic, political, social?)
- 15. Evaluate The Risks Rank the risks according to management priorities, by risk category and rated by likelihood and possible cost or consequence. Some risks are acceptable while others are not Avoiding, accepting, reducing, transferring
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- 17. Treating the Risks Acommon method of treating risks is to develop risk profiling and targeting systems. The profile information is used as the basis for Selection Criteria.
- 18. These companies havehad previous values adjustments. Ensure invoice validity and structure (i.e. ensure brand name, size, packaging, etc... are clearly marked) Verify authenticity of supplier to ensure all necessary information needed are adequately provided. Careful examination is requested for quantity, description and classification. Criteria "IMPVAL" ; If InListCom ( "IMPVAL" ) = Found Then RedLane IS 100 ; Endif ;
- 19. Processing of Lanes RedLane - documentary check and physical examination Yellow – Documentary check Blue – PCA Green Lane - the declaration is normally directly assessed
- 20. Monitor & Review measurethe effectiveness of risk profiles and update as necessary Reliable reporting of examination results Compliance measurement activities Feedback from the business community
- 21. Reporting of InspectionResults Accurate inspection reporting Effective use of the inspection act is essential for internal audit purposes, (to ensure system integrity), and for monitor and review of risk management selections. The risk management team needs to know if current selectivity criteria are effective. This helps by giving information that can be used to achieve more precise risk targeting.
- 22. Sources of informationfor Risk Assessments Identify commodity or control risks; e.g., high duty rates or quantity controls (Restricted Goods), the demand for prohibited goods Research existing databases and records on commodity and trader histories (Inspection Act, Intelligence from Post Audit and Enforcement Units). Evaluate current procedures to identify potential control weaknesses.
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