High volumes of trade, complicated structures of global supply chains, advances in criminal activities, and fear of terrorism, amongst other factors and trends, set challenges for Customs administrations worldwide, while aiming for high compliance rates and high degree of trade facilitation in their respective territories. One commonly quoted approach to assist Customs to achieve their objectives is the exploitation of Customs risk management (CRiM) – however, very limited research exists today explaining how CRiM is really being organized and put into practice at Customs administrations around the globe today. The goal of this study is to help to fill the gap in CRiM research, by proving a pragmatic framework for CRiM analysis and improvement purposes.
In particular, the study aims to answer the following three research questions, derived by the Cross-border Research Association study team:
• What are the essential components and what is the state-of-play like regarding CRiM today, on global scale?
• Which aspects of CRiM differentiate administrations located in high GDP per capita versus low GDP per capita regions / countries?
• What can be done and how to improve CRiM on both strategic and operational levels, at various WCO member administrations?
The total of 24 out of the 36 invited WCO member administrations replied to the study questionnaire in due time, enabling the research team to provide solid answers to these three research questions. Based on the study findings, following two conclusions are drawn:
• CRiM as a management system should consist of a balanced combination of policies and strategies; processes and procedures; human resources; tools and techniques; and data and intelligence. All the 24 administrations in the survey had at least some of these elements understood and implemented. But, no administration appears to have CRiM as a masterpiece of their management systems, neither on strategic nor on operational level.
• Customs operating in less developed economies perceive the benefit potential as lower and obstacles as higher than their counterparts in the wealthier nations. Limited efforts to manage human resources, and lack of CRiM tools and data feeding into CRiM processes are key examples where the administrations in poorer countries are falling behind today.
Finally, twelve tangible recommendations on how to move towards next levels of maturity in CRiM are made, to be considered by Directors Generals, Heads of Risk Management and other Customs Management Team members, at all WCO member administrations worldwide.
Publications and presentations:
Hintsa, J., Männistö, T., Hameri A.P., Thibedeau C., Sahlstedt, J., Tsikolenko, V., Finger M. and Granqvist M., 2011. Customs risk management (CRiM): A Survey of 24 WCO Member Administrations. Study for World Customs Organization (WCO). Lausanne, Switzerland on 28 February 2011. Available at WCO web-site: http://www.wcoomd.org/en/topics/enforcement-and-compliance/activities-and-programmes/ep_customs_intelligence.aspx [Accessed 3 December 2012]
Hintsa, J., Männistö, T., Hameri, A.-P., Finger, M., Thibedeau, C., Sahlsted, J. and Tsikolenko, V., 2010. Customs risk management (CRiM): a survey with 24 customs administrations. In: Proceedings in CD-ROM, the 3rd International Conference on Transportation and Logistics (T-LOG). Fukuoka City, Japan, 6-8 September 2010.