GRC Tuesdays: Discovering SAP Global Trade Services, customs connection

[T_Frenehard]

As detailed in an article published by the International Monetary Fund, goods arriving in ports or leaving the country are first presented to, and recorded by, the customs authorities. They are then cleared through customs, which means a customs procedure (import for consumption, temporary import, export, and so on) is requested by the declarant through the filing of a customs declaration.

Customs then verify that the declaration is correct to ensure that all relevant entry or exit obligations are fulfilled. From there, your good can then proceed.

Filing of a customs declaration is therefore one of the key steps of the cross-border sales and purchasing processes:

For this, companies have 2 choices: going via a customs broker who will perform these duties on behalf of the company OR self-filing, in which case in-house customs specialists take care of the procedure themselves.

Even if most companies today chose the customs broker option, many will have at least considered pursuing a self-filing approach for the potential benefits that this could bring. Especially in today’s very competitive landscape where the more volume runs through one country, the higher the need for speed and automation. Which brings the self-filing option into focus.

Indeed, potential benefits of self-filing customs declarations can include:

	Lower costs by reducing fees associated with using a customs broker
	Increased flexibility by being able to file whenever ready, without depending on brokers’ resource scheduling
	Reduced delays since any issue raised by the authorities is directly known to the organization who can take steps to resolve them quickly, potentially even before the shipment reaches its destination
	Gain in visibility from what is required, how and when, also preventing miscommunications since there are no intermediaries in the chain
	Own compliance and be in control. Here is a double edge sword though. The company will be fully liable for its filings so must always be up to date on upcoming changes initiated by national customs authorities. Getting this wrong could lead to significant financial and operational impacts

At least that’s the plan. But hiccups can occur, delaying or even blocking the process.

As per Supply Chain experts, typical reason for customs clearance blockages and delays mostly relate to:

Poor product description and/or classification
Missing or improper documentation (including certificates, etc.)
Incomplete information (values, addresses, etc.)
Unpaid taxes and duties

Not all these issues can be solved with technology of course, but many can. And here is where SAP Global Trade Services, customs connection enters the scene.

Until recently, the Cloud deployment of SAP Global Trade Services, edition for SAP HANA in private edition only supported the electronic submission of customs declarations through third parties, such as Seeburger Cloud or customs brokers, who can submit the declarations on behalf of the importer/exporter. This came with extra manual project efforts to be build this integration customer individually and with additional cost.

SAP Global Trade Services, customs connection has been introduced to fill this gap. It is a standardized public cloud based service providing simple and no-touch communication from SAP Global Trade Services edition for SAP HANA, private edition to customs authorities and/or customs brokers in supported countries:

Our partner, Seeburger, has provided this customs connectivity to SAP Global Trade Services customers both as an on-premise solution as well as in their own cloud offering for almost 20 years.

Since the solution and the partnership are proven, stable, and deliver value to SAP Global Trade Services customers, we have decided to take our partnership a step further and to provide this offering for private edition customers as well with standard SAP SLA support procedures.

With this new Cloud service, organizations will have parity, plus an opportunity for improvement, between SAP Global Trade Services, private edition and SAP Global Trade Services on-premise – enabling them to move to the Cloud with the same functional scope.

What’s in Scope?

Should you want to learn more about it, I would suggest having a look at the dedicated section of the SAP Help Portal: SAP Global Trade Services, customs connection | SAP Help Portal

Of course, self-filing is not a walk in the park and technology readiness is only one of the components for the decision making. There are definitely more considerations that need to be weighted accordingly:

• Do you have the in-house expert and licensed resources not just for filing, but also for regulatory insights?
• Do you already track cargo movements and coordinate with all parties (freight forwarders, transporters, warehouse, etc.) or is this currently done by a broker who may also be doing the filing?
• Do you already have the right contacts within the industry and the authorities, or do you need to build your network?
• Can you scale if the trade volume starts drastically increasing in a short period of time?
• …

Nevertheless, self-filing can represent a significant source of advantage for companies ready to embark on this journey so it may be worth considering!

I look forward to reading your thoughts and comments either on this blog or on Twitter @TFrenehard

And if you are interested in learning more about SAP solutions for Governance, Risk, and Compliance, feel free to fill-in the demo request form!