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Authorized Economic Operator Programs

In the Islamic Countries:

Enhancing Customs-Traders Partnership

35

Leveraging technology and adaptability for the future

Enhancing measurability of evidence-based outcomes and benefits

Optimizing available resources

Stronger partnerships between Customs and the industry (CBSA, 2018)

The PIP program is in line with the objectives and commitments of the Government of Canada

under the WCO SAFE Framework. Indeed, the program was successful at enhancing border and

supply chain security, while facilitating the movement of legitimate goods, thus reducing

border-related costs for operators. Recently, PIP members were also granted the benefit of

using FAST lanes into Canada, which had not been the case in the past. PIP has also enhanced

trade relations with third countries through MRAs.

At the technical level, the application process has been simplified with the development of the

Trusted Traders Portal. Phase 1 of Portal launched in 2014, and phase 2 in 2017. The portal

also allows for tracking the application status and facilitates administration and exchange of

information. The PIP program also has a database that includes tools and guidelines for

stakeholders.

Communication with stakeholders is crucial to the success of an AEO program. In this matter,

the CBSA collaborates closely with other governmental authorities and businesses. Currently,

the CBSA and industry communicate through a formal mechanism called the Border

Commercial Consultative Committee (APEC, 2016). Finally, PIP program activities were found

to have contributed to increased awareness regarding security issues and threats. This has

been particularly useful for SMEs, who were hence able to engage in the international supply

chain through PIP membership.

2.4 Developing Country Perspective

Developing countries usually design their respective AEO programs based on international

best cases. Therefore, the implementation steps are very similar to what is presented in this

chapter. Although developing countries are laggards in terms of AEO design and

implementation compared to developed countries, they started to experience the gains from

trade facilitation introduced by AEO implementation. To this effect, Box 2.2 presents the trade

impact of AEO implementation in Mexico.

However, the experience of developing countries is not always as smooth as the best

international cases as expected. There are additional challenges that developing countries face

both during design and implementation.

Legal challenges

: An important phase for the best international cases is the design of the legal

basis of AEO which enables the countries to function their programs within a previously

determined framework. Both Japan and the EU had extensive legal framework tailored

towards AEO design and implementation before the launching of their respective AEO

programs. However, the institutional and governance structure of the developing countries

may not allow the Customs Authorities to work under a well-defined legal framework. Instead,

they may be working under a law which does not prevent the operation of an AEO framework

but limits the scope of the AEO program. Case studies from OIC countries presented in Chapter

4 highlight these limitations.