Authorized Economic Operators
In the Islamic Countries:
Enhancing Customs-Traders Partnership
120
Recommendation:
A centralized and automated data exchange system between the different AEOs and related
government agencies should be adopted. The import/export declarations of the trader should
be sent to all stakeholders in a safe and secure electronic environment for their examination,
verification and authorization of transactions. Next, the government agencies either authorize
electronically or require physical inspection.
Challenge 5- Difficulties in identification of tangible benefits
In spite of the number and the diversity of benefits offered in the OIC AEO programs, these
benefits may not be enough to join the program in an economy that already has many trade
facilitation measures in place.
Turkey, for example, had a trade facilitation measure called authorized trader status which
granted most of the trade facilitation benefits of the AEO program without requiring stringent
safety/security measures. Under these circumstances it was very hard to convince companies
to participate in the AEO program.
Recommendation:
1. The private sector should be involved in the design of the AEO program from the
beginning to pinpoint the needed tangible benefits.
2. Awareness about the security of supply chain should be created among prospective
AEO status applicants.
3. The number of MRAs should be increased, particularly with the major trading
partners, to extend the tangible benefits across the borders.
Challenge 6- Insufficient number of MRAs
OIC region countries are experiencing difficulties in engaging and succeeding in MRA
negotiations due to diverse set of implementation practices across countries. MRAs have
utmost importance for AEO programs as the aim behind them is the globalization of supply
chain security and compliance standards.
Standardization and harmonization of security assessment, and implementation processes
take time for the Customs to sign MRAs. However, once Customs start to sign MRAs,
maintaining compliance and risk management will become more effective and will lead to new
MRAs.
For the participation of developed countries in the MRAs with the OIC countries, the quality of
AEO implementation is important, which crucially depends on institutions such as rule of law
and control of corruption.
The European Union uses mechanisms to electronically exchange data automatically.
Majority of APEC countries exchange data through encrypted Excel files.
Recommendation
1. The governments should note the challenges presented in Box 5.1 to design a
successful MRA.
2. For mutual benefits to be tangible for AEO holders in partner countries, trade
identification numbers should be harmonized.
3. The Customs Authorities should invest in capacity building initiatives to exchange data
in a safe and secure manner across MRA participants.