Custom reform makes major contribution to China’s business development – Dainik Savera Times

China has been the world’s second largest economy in terms of gross domestic product (GDP) since 2010. China has achieved this position by emphasizing consumption and services in its industrial policy. China’s economy is larger than the entire economy of Japan, Germany, the United Kingdom and India. Customs plays a key role in the administration of rules of origin from their formulation to their implementation. Custom reforms are also a major reason for the boom in China’s business sector. According to experts tracking trade and customs reforms, China made new plans in recent years. Efforts have been made to make products exported from China accessible to the global market through schemes such as “self-printing of certificates of origin”, electronic origin data exchange system (EODES) and “intelligence testing”.

First of all, China’s Customs Department implemented the method of “Smart Customs, Smart Borders and Smart Connectivity” i.e. Three S. Through which a roadmap was prepared towards modern and simple solutions for customs control, governance and cooperation. Due to which China’s exports increased. China integrated the functions and workforce of entry-exit inspection and mutual trade services into China Customs from March 2018. Administration of original certificate was also included in this.

These two measures prompted China’s Customs to review procedures related to rules of origin and ultimately improve the implementation of free trade agreements (FTAs) and preferential trade arrangements (PTAs).

There are three types of certificates of origin issued in China: non-preferential, preferential, and special. This last category of certificates is used for particular products and industries for which specific rules of origin requirements apply in the importing country. Under this, exporters can submit the documentary copy of the certificate of application or in electronic form, by connecting to the International Trade Single Window System or by visiting the Customs website. Once the application is examined and approved, China Customs notifies the exporter. After this the exporter can obtain a certificate from the China Council for the Promotion of International Trade. The release process is then monitored by China Customs. Upon receipt of the notification, exporters have two options: They can ask the Customs Department to provide them with the original copy of the certificate, bearing the manual signature and seal of the regional Customs office. Alternatively, the exporter can use the “Self-Printing Service” and print his own certificate, which bears the electronic signature and seal of the China Customs authority. The effect of the document is the same as a certificate manually signed and stamped by the customs officer. Only the first copy is considered as evidence. The second copy is considered just a copy. To use the self-printing service, the self-printed certificates must be recognized in the importing country.

The search engine of China’s customs department analyzes the exporter’s data and classifies his declarations according to the prescribed standards. Transactions identified as low risk are released without any further inspection (green channel), while transactions identified as high risk, i.e. red channel, are thoroughly scrutinized. This may require the importer or his representative to provide a hard copy of the original certificate or additional information. After checking this document, physical inspection of the goods can be done. During control, Customs focuses on both the nature of the goods and the authenticity of the documents provided by the importer. There are two main issues with the process as it currently exists. The first is that it is a cumbersome process to check the authenticity of scanned copies of documentary proof of origin submitted by parties and authorities located in another jurisdiction i.e. the exporting country. The second is that it cannot be done as soon as it is presented. To address these issues, China Customs has developed the Electronic Origin Data Exchange System (EODES). It enables the 11 partners that have signed FTAs/PTAs with China to exchange electronic data on proof of origin of goods imported or exported from their respective countries under preference claim to China Customs and designated administrations. makes. Importers and exporters are not required to submit and exchange certificates or other documentary evidence; Instead, they are simply required to state the certificate number on their declaration.

China’s Customs Department launched a pilot project called “Intelligent Examination” in August 2020 to speed up examination of documents of export applicants and detect fraud. Its objective was to create an artificial intelligence (AI) system that could modify its algorithms and develop new algorithms in response to the inputs and data it received. This technology has been in use since December 2020 and has already been used for the secure processing of more than 4.6 million requests for basic authentication. The AI ​​system is still being trained. Its developers hope that it will be able to mimic the thought processes of a fraud analyst and detect and adapt to new fraud patterns as they emerge.

（Author – Umesh Chaturvedi, Senior Indian Journalist）