The European Commission today announced that the European Union and China have agreed to expand the “smart and secure trade lanes” (SSTL) pilot project that allows testing end-to-end supply chain security instruments and mechanisms in line with WCO SAFE framework of standards.
As explained in today’s EC release, the SSTL between the EU and China was launched in 2006 as a voluntary program to test specific safety and security related recommendations of the WCO SAFE framework of standards as regards security measures applied to containers, facilitating Customs-to-Customs data exchange, risk management cooperation, mutual recognition of customs controls and trade partnership programmes. In 2010, SSTL entered into a second phase with the aim to expand the project to involve selecting more complex lanes, the inclusion of non-AEO companies, the expansion of risk management cooperation.
SSTL founding members are the Netherlands, UK and China. Other members (Belgium, France, Germany, Italy, and Poland) joined the pilot project in Phase 2 followed by Spain and Hong Kong that officially announced joining the SSTL pilot project in June 2013.
The SSTL Pilot Project currently operates (approximate) 120 trade lanes involving 200 economic operators involving 16 maritime ports and messages are exchanged via the WCO CENComm platform. Due to the data exchange between exporting and importing customs authorities before container stuffing and container loading, the consignments operated under the SSTL pilot project may benefit from the least possible customs intervention in the logistical process.
The joint administrative arrangement for Phase 3 of the SSTL pilot project was signed 15 July 2016. In this pilot program, the General Administration of China Customs and Hong Kong Customs join the customs authorities of eight EU Member States (Belgium, France, Germany, Italy, Netherlands, Poland, Spain, and the United Kingdom) and the Directorate-General for Taxation and Customs Union of the European Commission. Seven additional EU Member States (Czech Republic, Greece, Hungary, Lithuania, Portugal, Romania, and Slovakia) as well as the WCO are to take part as observers.
Traders joining SSTL are intended to have quicker customs clearance with enhanced logistical processes and overall predictability of the availability of goods for final consumers. Traders will also gain experience with a new customs and other government agencies approach to control low risk supply chains and experiences with participating foreign companies may pave the way for easier access to Authorised Economic Operator programs.
Phase 3 is intended to result in an increase in the share of goods traded between the participants covered by SSTL, and is thus expected to have a substantial impact on overall supply chain security and trade facilitation between the EU and China. This involves notably expanding the scope of the pilot, both geographically as well as to air and rail transport, in addition to maritime transport; increasing the volume of consignments covered; and incorporating advanced risk management techniques and developing common risk rules. A data exchange mechanism is being developed to support the above objectives and actions.
The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.
KPMG's new digital platform