1. Introduction

 

In Module 1 we examined the regulatory and commercial requirements that dictate how international trade is conducted. In this module we examine how international law agreements govern the relations between states in the exercise of Customs powers, and the principles that Customs and other regulatory authorities use to ensure compliance with international and domestic law. 

The module is in two parts. 

Part 1 introduces the key international agreements developed by the WCO and the WTO. We look closely at four agreements: 

  • The Revised Kyoto Convention on the Simplification and Harmonization of Customs Procedures (RKC) and the WTO Trade Facilitation Agreement (TFA) — both establish legally binding obligations on how to clear goods for import, export and other Customs purposes, and on the collection of revenues. 

  • The Harmonized System Convention (HS Convention) — delivers a global coding system for all goods engaged in international trade. 

  • The WTO Valuation Agreement — provides the basis on which all WTO Members are to determine the value of goods at the time of importation. 

The Activity for this module asks you to complete a short research task on these agreements, and one or two others that also bear on Customs work. 

Part 2 examines the principles of regulatory compliance and how countries enforce these agreements at the national level. Key topics include: 

  • Risk management — how it has been introduced into Customs work worldwide, and the legally enforceable standards the RKC and TFA set for administrations to follow. 

  • Post-clearance audit — how Customs monitors compliance without intervening at the point of arrival or departure of goods, shifting from real-time intervention to audit-based controls. 

  • Cooperative compliance — the use of techniques such as binding rulings to resolve difficult situations before they arise, built on cooperation with the trade rather than confrontation. 

  • Enforcement and recognition — the range of measures available to penalise non-compliers, and the reward and recognition strategies available for highly compliant companies. 

Information technology and risk management have been the key enablers that allow Customs to keep pace with increasing volumes of trade and passengers, and to ensure the border is well managed, without proportional increases in resources. Those of you in countries where ASYCUDA has been recently introduced will be familiar with how ASYCUDA World gives effect to international agreements such as the Harmonized System Convention. 

We turn now to an examination of the key international trade treaties and conventions.