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COMPLIANCE and SECURITY STANDARDS
Challenge 10- Data Security
Due to the large volumes of data collected by governments from the AEOs, added safety and
security measures need to be taken in order to protect the commercial interests of the AEOs.
Recommendation:
1. To satisfy the needs of the private sector and to adopt new technologies the
government should revise the AEO legislation periodically through amendments to the
current regulations or through completely new ones.
2. A new genre of personnel who are well-versed in technology and law should be
employed.
3. Dissemination of data (when and if required) in a safe and secure environment should
be broadened to all the relevant public sector institutions. One way of achieving this
outcome is employing the state-of-the-art block-chain technology which has started to
gain traction in the developed countries.
5.3. Towards a Regional MRA/AEO
The aim behind the WCO SAFE Framework, thus AEO, is to provide secure and safe
transactions along the supply chain. The tool for the companies in the supply chain to become
interested in participating in an AEO program is to provide them sufficient incentives that
translate into actual savings. Through mutual recognition agreements an AEO company having
a certificate in one country will have the opportunity to enjoy the benefits in all the AEO
programs that the country has signed an MRA.
MRAs are mostly carried out on bilateral basis around the world, with some limitations,
restrictions and distinct practices and procedures. Widdowson (2014) explain the difficulties
that would be faced by bilateral MRAs as follows:
“Consider for a moment what it would mean for the 179 WCO Members if each had an AEO
program in place, and mutual recognition was to be achieved across all such programs. Taking
into account the fact that the EU initiative has effectively reduced the potential number of
‘national’ programs from 179 to 152, the number of bilateral agreements that would need to be
struck in order to achieve this ambition is 11,476, with each country being involved in the
negotiation of 151 individual agreements.”
Considering that designing an MRA has significant administrative costs during the negotiation
and maintaining the agreement phases, it is a burden for a country to carry on several bilateral
MRAs simultaneously. Therefore, it takes time for a country to enrich its set of MRAs which
limits the benefits of AEO certificate holders.
Regional AEO Programs or Regional MRAs would be the effective way to achieve a safe and
secure supply chain and to facilitate trade in a country by encouraging economies to
collaborate in establishing common AEO programs.
Regional AEO programs would be a cost-minimizing and efficient way of achieving supply
chain security and higher numbers of interested companies to hold the AEO status. The EU
AEO program is an example for a regional AEO program that is established by an internal