FACILITATING INTRA-OIC TRADE:
Improving the Efficiency of the Customs Procedures in the OIC Member States
41
Coordination and cooperation with the relevant stakeholders especially with other
border protection agencies is essential for implementing risk management successfully.
Effective use of risk management reduces the percentage of physical control limited to
high risk cargo at the borders. For those goods which Customs chooses to inspect, it is
important that such verification be performed as quickly and effectively wherever
possible utilizing nonintrusive inspection techniques (e.g. X-ray or other devices) to
minimize cargo dwell times and related costs (IFC 2007).
The evidence shows that using effective risk management contributes substantially to
increasing international trade transactions. For example, enhancements made to Japan
Customs' risk assessment capabilities since 1999 helped Customs keep the staffing
levels nearly unchanged since 1999, while the number of import transactions increased
by almost 60 % (2007) and exports transactions increased by around 50% (2007)
(UNECE 2012).
Usage of Risk Management is not so common in developing countries, especially in the
LDCs. Based on their research on 107 non-OECD countries (which includes 21 low
income, 32 lower middle income, 39 upper middle income, and 15 high income
countries), Moïsé and Sorescu (2013) found that 34 of the countries have such a system
successfully implemented which are mostly upper middle income and high income
countries. They also suggest that risk management, if implemented successfully, will
reduce trade costs by 2.4 percent.
-Post-Clearance Audit
The Standard 6.6 of the RKC states that “Customs control systems shall include audit-
based controls”. The RKC also defines the “audit-based control” as “measures by which
the Customs satisfy themselves as to the accuracy and authenticity of declarations
through the examination of the relevant books, records, business systems and
commercial data held by persons concerned”.
The Guidelines for Post Clearance Audit Volume 1, issued by the WCO in 2012
provides detailed information on the framework. Volume 2 of the Guidelines presents
useful information for implementation but it is restricted to use of customs officials.
Volume 1 describes objectives, benefits, audit cycle, types, requirements etc.
According to the UNECE (2012), Post Clearance Audit may have two forms, namely
transaction-based controls and periodic and cyclic audits. Transaction based controls are
made at the border by verifying the classification, valuation and origin of the goods
after release through an audit of the supporting commercial documentation. On the other
hand periodic audits are carried usually at the premises of the importer or trader
concerned, where Customs reviews imports over a given period and checks all relevant
commercial records, including bank statements and contracts to verify the particulars