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Friday, 26 July 2013


I am sure you have heard it before. You start discussions with a potential distributor and almost the first thing they say after ‘Hello’ is ‘Of course we would want exclusivity’. Now presumably your market research indicated that the people you are speaking to are good candidates or you would not have approached them, right? And it isn’t always just an opening gambit. Very often they are absolutely serious, and you need to be able to handle that.
So start by putting yourself in their shoes. They are approached to distribute your range of products, the first time they have been introduced to their market. You offer something new, and maybe they can gain reputation by being the first to have access to it. It may give them competitive advantage, and they will want to protect that. What would you ask for if you were them? Exclusivity I imagine!
Spain had proven to be a very difficult market to penetrate as I strove to carpet as many of Europe’s offices as possible with premium quality carpet tiles. The climate in most of the country doesn’t really lend itself to their use, and my modest successes in the first three years were through retail stores. I travelled to Madrid, Barcelona, and Bilbao, to gather market information, visiting the British Embassy in Madrid and the Consulates in the latter two, and making appointments with a number of distributors in each city with very capable interpreters in tow. Our competitors were doing well there, embedded in fact, so why weren’t we?  For the whole trip I felt like I was missing a trick.
For about a year prior to that trip, I had been working in collaboration with a manufacturer of raised access flooring, and a manufacturer of adhesives, on the principle that we could offer our products together as a package: carpet tiles adhered to raised access flooring panels was the jist of it. We met every few months to discuss opportunities, and in one of those meetings, the panel manufacturer suggested he introduced me to a number of his distributors around Europe, with the deal being that I would reciprocate. One of their most successful distributors was based in Spain with offices in both Madrid and Barcelona, and as only an occasional seller of carpet tiles for a competitor, they had crept under my radar. Here were three dynamic guys, supported by a great team, and I had somehow missed them!
My main problem was that I was starting from a position of weakness. The distributor knew I was finding it hard to enter their market because the panel manufacturer had told them, so they knew they could play hardball. Their position was that they wanted exclusivity, and my position was that I really didn’t have an alternative other than to concentrate on other markets and leave Spain out of my portfolio. However, at the time there were a large number of major construction projects across the country, and if I didn’t get our products specified then our competition certainly would. And it wasn’t as if I was going in blind. The company I was talking to had a track record with the panel company and some experience of getting carpet tiles specified in the commercial sector.
In this case I knew before meeting them that exclusivity would be the deal breaker, and I was prepared to take a calculated risk and offer it to them, on certain conditions:

  1.    If they wanted exclusivity, then I did not want them selling any competitive products.
  2.  I required a full list of ongoing projects where they had specified the competitive products, and the company should try to change specification to our products where possible.
  3. I would give them six months free reign In the market without contacting any other potential distributors, and I would refer any enquiries from Spain directly to them.
  4. That they accepted my payment terms of 30 days from the date of invoice.
  5. That the distributor took a certain amount of stock, albeit at discounted rates to get the relationship started.

Well they were okay with points 1 and 2! I knew that point 3 was fairly meaningless because they knew I hadn’t found an alternative, but it was important to give notice that they would have to perform. Specification selling doesn’t happen overnight because you can’t change the timescale for the construction of a building, so it would have been pointless to also insist on a sales target for the six month period. I also knew they would ask for 90 day terms, so we agreed on 60 with a commitment to review based on performance, but taking stock was not an option for them because they would then have to second guess what products and colourways would be most likely to be specified. So in the end we met half way I suppose.
It actually took the best part of six months to formalise a contract between us, and I was glad to have been introduced because their performance for the next few years was fantastic, to the point where when I left the company, they became the official office in Spain for our recent new owners. This is one occasion where it was the right thing to accede to their demand for exclusivity, and the reputation they had gained with the raised access company provided a good degree of confidence, and smoothed the negotiation process.

In this case, the answer to ‘So you want exclusivity?’ was ‘Oh alright then!’, and it was absolutely the right decision. The next Tale is of an opposite experience. 

Friday, 12 July 2013

Inside the World Customs Organisation (WCO) (11) Day Two with ROO – and I finally passed out

Today I finally passed out – ok jokers, it had nothing to do with the beer last night!  The Customs & Trade WCO Knowledge Academy ended today with an awards ceremony. I am pleased to say I got my certificate and I am a proud member of the Class of 2013, The experience is indescribable – though I’ve had a go – the mix of cultures, opinion, politics, the law, fun, regulations in the making, case studies, term of reference, fun, different cultures, fun, learning new things, being reassured that you did know other things … did I mention fun?

Receiving Academy Certificate from Kunio Mikuriya, Secretary General of the World Customs Organization
My last session of the Academy was Rule of preference origin (again) – the law makers and the harmonisation.  Couldn’t have been better for me; a bit advanced for some and irrelevant for others, but great speakers and really useful information.  Hopefully by this time next year we will have one big EU Free Trade Agreement with a single regulation covering preference with 46 Euro-Med countries. ASEAN are attempting the same.  I’m afraid I did do a bit of basic origin training for some of the delegates in the break and lunch time, but you can’t keep an old trainer down – I even got my Japanese and Chinese friends to understand the joke about international trade being the 2nd oldest profession in the world. I heard them sharing it with the guys from the Congo … oh, dear, what have I started?

We were awarded our Certificates by Kunio Mikuriya, Secretary General of the World Customs Organization and he made a nice (short) speech about collaboration between trade and customs being important to forge a safe international trading future with interaction, communication and understanding.  It was an honour to shake his hand.  And now most of the delegates are flying home 12-30 hour flights not unusual).  I’ve received offer to visit Trinidad & Tobago, Papua New Guinea, Brazil, Stockholm, the DR Congo and Nigeria – just to mention the ones I can remember right now.  Who knows?

One thing I do know is that there is nothing wrong with the knowledge and commitment of Customs & Trade in the big “bad” World.  I’m glad this career chose me – maybe I can sneak back next year in a speakers’ slot?  Greg????  Ready for my close-up Mr Pilkington.
Me, Ayumi and Ethan on the town, our last night in Brussels
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One of the things I have found most important when travelling abroad on business is to have as much control as possible over my transport arrangements. I’m sure many of you have been in a situation where key points in negotiations are stalled until the last minute, so that your need to clinch a deal before your taxi arrives to take you to the airport becomes more of a focus than getting the right deal. That only happened to me once, and I chose to take my taxi rather than a deal that would not have been good for the company. It was the right thing to do because the onus was then on the other party to make a concession, which they eventually did a few weeks later. Think about it. If a deal is that important, then first you will ensure your flight plans are flexible, and second you will probably arrive and leave under your own steam, and hiring a car is one thing that will give you flexibility.
I have had far more good experiences of hiring cars than bad. And in most of the bad cases, there has been something I could probably have done better. If I had my life over again, the one I would change would be the ‘economy’ car I hired with a colleague to take us from Chicago Airport to a small town in Michigan where we were to visit a potential woodworking machinery dealer.  Both of us were big blokes, and we imagined an economy car in the USA would be on a par with a Ford Mondeo or similar medium sized saloon. Well it wasn’t. Instead we were introduced to the smallest Chrysler in the world!
It was one of those occasions where we actually had more time than we thought between our flight arriving and the meeting time, so we could have dug our heels in for something better or tried another car hire company. In the end our need to get on the road in not the best of weathers, caused us not to question what was on offer. Mistake. Why is it that heating systems on cars only ever fail spectacularly in extreme cold weather? It was okay when we left the airport for our two+ hour journey, crammed into our seats like an oversized child on a kiddie’s fairground ride (that happened to me too. When I was 12. But I’m not telling you about that – too traumatic!). Then about half an hour into our journey as the snow started to fall, everything suddenly went perishingly cold.
As we drove along the interstate in our tiny and grossly underpowered aluminium can on wheels, with huge trucks passing us and spraying large chunks of dirty snow onto our windscreen, we drove into a sudden ice storm that rendered our wiper blades next to useless. The condensation from our breath inside the by now unheated car then froze onto the inside of the windows and in that sorry state we battled on to the next service area, which thankfully was only a few miles distant, with the windows open wide enough to lower the cabin temperature, but not so wide to cover us in ice. The storm passed soon after we stopped, but of course the delay made it touch and go whether we would reach the meeting venue on time.
Although we did get there on time, our journey had not been the best preparation and I don’t think either of us performed nearly as well as we should have. So five mistakes never to be repeated:
  1. The timescale was too tight. Flying in the previous day would have been a better option
  2. We should have hired the right car
  3. We should have checked the weather
  4. We should have worn warmer clothing. Suits just didn’t hack it!
  5. We should have arrived fresh and ready for business 

That was in the mid-1990’s, since when we have been blessed with the invention of a vast array of communication aids: both mobile phones and a SatNav would probably have helped us with our journey, and in the case of that particular meeting, a video call would probably have told us most of what we learned there anyway – that they were not the right dealers to sell our machinery!

It is important to try and make every business trip as efficient as possible, with all available time filled. However, there are now few occasions when I travel these days where I do not reserve one day for rest and consolidation, or just to make sure I am in the right place at the right time, ready to do my job to the best of my ability. I think running my own business has taught me that sometimes it can be quite productive to give yourself a non-pressure day, to walk round the local town or city, to plan, or just to feel attuned with your surroundings and ready to tackle the task ahead. It clears your mind, and helps you to perform. I will leave the other bad car hire stories for another Tale!

Thursday, 11 July 2013

Inside the World Customs Organisation (WCO) (10) On the town sampling Brussels Beer – and learning about Rules of Origin (or ROO as we call it)

I was disappointed – I wanted to get the WCO take on non-preference rules of origin but don’t think that’s going to happen.  Strange they just seem to think it is irrelevant – odd as the WTO have been trying to negotiate standard non-preference rules of origin for about 15 years.  OK, maybe that’s why they aren’t covering it. So it’s preference origin and Regional Trade Agreement, things I deal with every day – but I’m always ready to learn something different about it and I did learn about the drafting process for RTAs which was interesting.  More preference ROO tomorrow and probably more photographs – it’ll be strange everyone going home.  And we’ll get our Certificates!  Yeah, certified at last!

Leonardo, the WCO Technical Advisor on Valuation organised a beer sampling trip after the training.  It was great – don’t like all the beer, some are too fruity and fizzy for me, but fun to taste them.  Then a smaller group of us went to watch the ladies’ football.  So 6 of us (2 Danes, 2 Swedes, 1 Portuguese and me) sitting in an Irish pub in Brussels watching Denmark and Sweden play football – it was a 1:1 draw so no fighting. The annoying thing is our Brazilian friends said it’d be 1:1 – you don’t know how annoying that is!  Anyway, if you wonder how they serve beer in Brussels, check out the pictures.

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Wednesday, 10 July 2013

Inside the World Customs Organisation (WCO) (9) Day two: valuation rules – feeling weaker

The only thing that didn’t seem right today was that the valuation speakers again went through the first sale price principle and concentrated on EU examples – to a room with 75% non EU countries, were this isn’t relevant.  Actually there was something else, but this isn’t anything to do with the Academy --- why don’t we have standard valuation rules for exports?

I haven’t just thought of this question today, I think about it every time we get a shipment from, say the USA, for repair and they declare $50 and yet the part is $50,000 when new – there’s no link up.  Today this came across as a big problem for developing countries.  Developing markets rely heavily on customs duty for revenue (EU 3% of government’s revenue comes from duties/ Sri Lanka 60% does!) but the developed countries’ exporters help their customers to cheat.  OK its fraud to declare an incorrect value on an invoice – even an invoice for shipping or customs purposes – but is it fraud to raise 2 or 3 invoices dividing up the value of an export shipment suspecting the importer will only present one to customs for duty purposes?  Very difficult, but we don’t have a WTO Valuation Rule for Export Purposes, only import purposes. And, no answers here

We all passed our valuation tests at the end of the day and can move on smiling and happy to the last 20 hours on origin, starting tomorrow.  But first a cocktail party – it was great mixing with the other delegates again and meeting some from the other sessions.  I’m already feeling sad that it’ll be over on Thursday evening after the graduation party.

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Tuesday, 9 July 2013

Inside the World Customs Organisation (WCO) (8) Did I really sign up to 20 hours on valuation?

For a lot of people this morning was their first day in school.  We lost quite a few friends last week but their places were filled by newbies – again from all over the world; maybe a few more European, USA, Canada people than before.  They must have thought it very odd seeing us all from last week greeting each other - kissing/ hugging/ laughing, very multi-cultural and multi-lingual.  We had an opening session and I sat next to a guy from a software company in the USA: “Must have been one hell of a good week last week,” he said, “sorry I missed it.  Probably too late for me to fit in like the rest of you.”  But by lunchtime he was chatting over lunch with a guy from Manila, two ladies from Brazil and a couple from the Congo – it doesn’t take long to get to know each other here.

We had a great “professor” for valuation in the morning, Leonardo from Brazil working at the WCO. He loves valuation – the philosophy, the history, the practical, the legal – fantastic sessions with jazz, classical music and dancing used to enhance our understanding.  Did you know that determining intercompany pricing was like a dance?  Neither did I until this morning. A very un-Brazilian dance though – arms-length!  OK, you had to be there to get the joke, maybe.

There are about 30 people in my group doing valuation – about 150 people here in total (50/50 trade and customs).  We have been doing some practical workshops as well as learning the WTO Valuation law – I know it but I’ve never been taught it in this way so it’s great.  I really am a sad Customs nerd … but then I’m in a class of 30 other nerds.

Dinner: Katrina and Gabriela and I wandering into the Grand Palace and found a place serving pasta. It made a nice change.  Another 10 hours on valuation tomorrow and Leonardo is back … dancing?  We’ll see.

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Sunday, 7 July 2013

Inside the World Customs Organisation (WCO) (7) A Day Off ... well nearly

Sunday in Brussels - hot and sunny - I didn't even take my umbrella out with me (coming from England that is a major change from norm).  I found something summery to wear and wandered out into the centre of the old town.  Even at 10am, with church bells ringing all around, people were eating and drinking in street cafes.

Shame about the people sleeping in doorways and in bus shelters, I would say I've seen more "street people" here than in London - at least the weather is ok for them at the moment.  Last night (or should I say and early this morning) police and ambulance sirens were going on regularly right upto to 4am - Saturday night was the worst night's sleep while here.

Anyway, the sun is shining and on the banks of the Canal a large stretch had been covered with sand to form a beach and there was dancing and sun-bathing.  I almost forget I was in Brussels to work.

At lunchtime I met Tommas from Sweden at a little cafe across from St Catherines Church which is closed (going to be renervated and turning into a market hall because of the demand for churches here).  We sat outside and I ordered in French - I'm pretty quick at picking up phrases/ don't know what they say to me but I'm a good mimic; Tommas was impressed until the waiter asked me a question - cover blown!  Then began the lesson on GIRs and tariff classification - yes, I am working on a Sunday.  The weird thing is I enjoyed myself. 

The sessions at the WCO were good but Tommas is new to it all and there was an assumption of knowledge - something we never try to do.  You can never be too basic - a lesson I learnt many years ago when, in an Export Documentation training course a delegate asked me, shyly, "What is an Export?"

So we ate, talked and then I walked back to my hotel to watch Andy Murray win Wimbledon.  All around a good day.  Hope I get a good night's sleep - its the first 10 hours on the International rules on Valuation tomorrow - I'm so excited!

Inside the World Customs Organisation (WCO) (6) The highs and lows of the Field Trip

 Saturday was a beautiful day - hot and sunny we met outside the WCO building at 9.45 but instead of the 40 people we had just half.  Maybe with the day being so beautiful a few more had decided to do their own thing - there is a man-made beach open today on the banks of the canal with dancing and festival activities. Very tempting just to sit and sun-bath - but hopefully I can do that tomorrow.  I'm beginning to feel a bit like the old-lady of the group hobbling a little with my back but I was determined to keep up with them.  The Group, in the end, comprised of mainly non-Europeans I met a couple of  new people from Papua New Guinea Customs, Saudi & D.R Congo.  People really have travelled thousands of miles for this event and they are struggling with 8-10 hour time differences. 

The Group outside the Parlamentarium Brussels

We were divided into two groups and our first stop was the top floor of a multi-storey car-park.  The only place in Brussels to see the whole of the city - amazing.  The top floor is closed to cars and the guide said it was used in alot of Hollywood movies. Then the eating tour began - we had cheese in a pot on crispy French stick, snails (yes, I ate them), chocolates and chocolate drink (yes, even though I don't like chocolate I had these too) and then "bread from the ditch" a very sweet bread - then lunch!

Work was never far from our conversations - we really are a sad bunch of Customs nerds - but it was our common ground I suppose. I was asked to explain to a group from a couple of African countries the difference between the UK House of Commons, the House of Lords and the Monarchy - thank goodness I'm an history and politics student as well as a customs nerd.  The trip round the European Parliament was good but I was tired then so don't think I gave it my full attention.  We ended with a group photo and then the metro home.  They are meeting up for a meal at 8pm at the Turkish Restaurant (award winning!  he showed us his gold medal) but think I'll give it a miss.  This "old lady" is ready for a good sleep.

Saturday, 6 July 2013

Inside the World Customs Organisation (WCO) (5) The WCO view of the GIRs – did I learn anything

Well, to answer the title of this blog – yes, I did learn lots of things.  It’s always interesting to hear about tariff classification examples and learning about them from the WCO Harmonisation System Committee who makes the Legal Decisions and writes the HS Code was brilliant.  I’ve got lots of new examples to add to our own tariff classification training. 

I’ve never spent a whole day concentrating on one GIR before – that’s General Interpretative Rule of the HS Codes which you use to get the most appropriate number.  (Sorry if you’re none technical or not really interested in Customs Procedures … and if you’re not – why not!!!)  A full day looking at how to use GIR3 in classifying mixtures, sets and composite goods – I must be sad but I found it fascinating and the time just flew.  One of the guys was struggling a bit – he’s new to customs issues and doesn’t have good basic knowledge.  I found myself turning on trainer mode and before I knew what was happening at the breaks I had a little group listening to me explaining about how to read the tariff schedule and how the 6 GIRs fit together.  I’m also booked for some more sessions this weekend.

Before we knew it the 30 of us from all over the world were saying goodbye and taking pictures … but most of us are back next week for valuation and origin (20 hours training on each topic). Great!

Some of the delegates are going home though – that was sad – but we’ll have new people joining us next week.  I now have contacts in Customs in Nigeria, Singapore, Brazil, Zambia, the Congo, Sri Lanka, India, Jamaica and an invite to talk at a conference in Sao Paulo Brazil in November and at a Customs Conference in Trinidad next March.  Others are taking advantage of their EU VISA and going to Prague, Paris, Amsterdam, etc this weekend.  The WCO have a trip planned tomorrow – chocolate houses, museum and the European Parliament tour before a meal together in a Turkish restaurant.  I’m looking forward to it; though I can’t believe how tired I am.  It is hard being a delegate/ student … I must remember that for next time I’m the tutor.

Friday, 5 July 2013


Sometimes it doesn’t matter how much you plan, there are things that you cannot predict, and some of them can significantly disrupt the way you go about your business. This Tale starts here in the UK in 2001 when the Foot & Mouth epidemic broke out, the first outbreak for 20 years. A few weeks before, I had arranged to take my 14 year old son up to the Roman sites along Hadrian’s Wall and across to Northumberland, and knowing there would be some travel disruption we decided to stick to plan rather than postpone until a better time.

And we did manage to see Vindolanda and some of the other key features of the wall, but our route was blocked to many others, as DEFRA supervised the burning of huge numbers of livestock. Our onward journey to Northumberland saw us diverted onto minor routes that we would probably never have experienced otherwise, and we meandered our way along these permissible routes until we reached our destination at Lindisfarne.

So what has all that got to do with international trade? Well the 2001 outbreak had a massive impact on the country’s economy and agricultural exports, and not just in monetary terms. Figures vary enormously, but it is estimated that as many as 6 million animals had to be slaughtered and taken out of the food chain, and the cost to British farming not too far short of £1billion, with compensation to farmers being a similar figure. Tourism and the rural economy were very badly affected with estimated combined losses of around £5billion. Confidence in British dairy and meat products plummeted, the knock-on effects for the UK agricultural supply sector included a decline in sales, livestock market closures and loss of business to livestock transporters. And it took some time for export bans to be lifted after the crisis was over. Even if, as is sometimes argued, more could have been done to prevent the outbreak, nobody could have predicted its scale.

On 21st February 2001 the UK government banned the export of all live animals, meat and dairy products, with the EU imposing a initial temporary ban until 1st March. Horse racing fixtures were banned initially for a week but later the ban on animal movements caused the cancellation of the annual Cheltenham Festival, and even the Ireland v Wales rugby international in Dublin was postponed. On 1st March the French culled a second batch of 30,000 animals as the disease threatened to spread across Europe. By the middle of March the scare had gone global, with reports of incidences of the disease as far away as Argentina and Brazil. Supermarkets in some parts of the UK were starting to run out of meat and dairy products. So a lot to do with international trade!

I was travelling to Ireland at least once a month at that time, and every vehicle at every ferry port was sprayed with disinfectant and every foot passenger required to walk through a shallow disinfectant bath, both on boarding at Holyhead and even more thoroughly on disembarking at Dun Laoghaire. It was the same at Dublin Airport where passengers walked through a shallow disinfectant bath after arriving in the terminal building. That whole process caused delays at the ports and airports and there was an atmosphere bordering on paranoia, and the procedures lasted way beyond the eventual lifting of export bans and the UK being declared clear of the disease. So yes, foot and mouth had a massive impact.

One of our key messages to companies who want to expand their export business is that they should have a five year plan for exports. The plan will help you to target markets, identify times when you should make sales visits to those markets, how much budget you should set aside for each target market, and how much business you expect to win in each case. The plan should also feature major events in a market that might affect the efficiency of your business, or the speed at which you can convert enquiries into orders. Many of those things can be timetabled, but natural events such as the Foot & Mouth outbreak cannot be put into a plan because they are not within our control and we cannot predict them.

And to end on a further sobering note, I had enjoyed excellent business through a fantastic distributor in Turkey for three consecutive years to the point where a forecast for the following year was conservatively estimated at £400,000. Then there was an earthquake in Turkey, and the actual figure for the following year was £7,164, such was its impact. So your plan needs to be flexible and you should be able to change course and respond seamlessly to events that are out of your control.

Inside the World Customs Organisation (WCO) (4) Day One of Harmonised System training

Changed to my second program of the Academy today – Harmonised System and the classification of hi-tech goods, current issues under discussion and the possible amendments for HS2017.  I knew it took a long time to get the amendments through but I was surprised to learn that the final drafts for inclusion in the next revision (the HS Codes are revised about every 5 years – current HS2012) have to be ready by November 2013 for publication 2017!  The HS is a brilliant system of coding goods internationally for customs and trade purposes but it will always be out of date – little titbit = new headings for LED lights, lamps, modules, panels to be added; possible new heading for tripods, monopods, etc for digital cameras.

This group had more people from trade – about 50/50 trade and customs – Siemens Denmark and Ikea Sweden to name just two companies who had sent someone over to the Academy.  I recommend it.  Really good day – looking forward to tomorrow’s session already.

And in the evening around 15 of us went on the town – and the weather was kind, no rain but chilly – it was the annual Ommegang.  After taking pictures with that lovely little boy the Manneken Pis and a beer in a great place full of puppets we joined the people in the Grand-Place. From 9 pm the historic parade, part of the Brussels folklore, unfolded with more than 1.400 actors, folk and historic groups  – many local people who had made their own costumes - horses, puppet theatre, giants, flags,... It was breath-taking.  The event is to honour the coming of Charles the Fifth to Brussels in 1549 – here’s a link to more information about the Ommegang with a video clip

I take it all back, Brussels is beautiful – the Grand-Place stunning

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Thursday, 4 July 2013

Inside the World Customs Organisation (WCO) (3) International Trade Facilitation – again!

Woke up to a very rainy Brussels – I have my umbrella and raincoat though, us English are always prepared for bad weather; not sure what I’ll wear if we get brilliant sun shine though.  So, after a very wet walk around the corner I arrived for day two at the WCO and another day on Trade Facilitation.

I learnt a lot. Useful stuff? – We’ll see.  I’ve been sat here at the computer for 10 mins now trying to think of another way of saying it but I can’t.  It was boring today.  Apart from a short group quiz (which was fun, even though I didn’t win) it was just listening to people running through lists of rules and regulations in both English and French.  I have a terrible habit when listening to other people presenting, I try and sketch them, sad I know. It doesn’t mean I’m not listening, it usually helps me concentrate – anyway today I started sketching the delegates too.  Enough said.

But it was informative, I am certain I could write a paper on the Revised Kyoto Convention (RKC) – probably in both French and English, and you know how good my French is!  Actually, I do have to write a paper on the RKC for the Institute of Export – that’s lucky then.  Oh, yes, met some USA and European delegates today but they weren’t in the Trade Facilitation sessions.  Also told that a lot of delegates from developing countries had been sponsored to attend – explains the imbalance a bit. I did wonder, as we were going through the RKC recommendation on the Simplification and Harmonisation of Customs Procedures how many of the attendee’s countries could afford to follow these recommendation.  Of the 179 countries that are members of the WCO 89 have contracted to the RKC – we were shown the list (one of many lists) and I didn’t see many African or South American countries on there but then neither was Israel.  Here’s a link if you want to know more about this really excellent initiative RKC READ MORE

Tomorrow I move over onto Harmonised System classification work – I can’t say I’m sorry; I’m not sure I could have found enough to draw to get me through 2 more days of Trade Facilitation. 

Forgot to say – lunch was good today; almost made up for the restaurant meal last night.  Tonight a couple

of us are trying the Grill next-door.  Fingers crossed. 

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Wednesday, 3 July 2013

Inside the World Customs Organisation (WCO) (2) Day One of the Knowledge Academy for Customs & Trade – Trade Facilitation

OK, so let’s get this straight – as my new friend Omar from Brazilian Customs Agency reminded everyone – Customs Trade Facilitation is about making things easier not about customs officials collecting facilitation fees.  The 1st is good news the second, well, illegal. 

Anyway, today was day one on Customs Trade Facilitation at the WCO and I got there early, got my badge – meet my linkedin connection Greg Pilkington on reception and my first new friend Tina from Jamaican Customs.  We were eventually all taken into the Kyoto Room for a group “hello” and then off into our separate training rooms.  Being in the WCO was obviously a thrill to most people as there was a lot of picture taking; Susi from Singapore Customs snapped me in a nearly empty room, not sure what I was laughing at though! 

The presentations made me realise that there is a lot of change ahead for us all involved in international trade.  This “trusted trader” partnership between customs and industry is going to make a big impact to supply chain costs and times very soon.  There was quite a lot of interaction from the delegates – for once I resisted the temptation to ask questions, happy to listen to the others – and what struck me was the people here to learn about customs procedures and trade facilitation had flown in from far more distant places than I.  In fact, apart from the organisers and speakers I met no-one from Europe, Canada or the USA – maybe we think we know it all??!!  The conflict between facilitating trade and maintaining a secure supply chain came across good and strong – it’s facilitation of legitimate trade that is being developed, hence the need for accredited businesses (AEO as we call it in the EU). 
Key moments – the ICC talking about their new initiative of accrediting the bodies that issue Certificates of Origin and having an on-line checking system; the WTO nearing the end of the Doha Round after 9 years (Bali December 2013 – maybe, perhaps) with the signing of the Trade Facilitation Agreement; the cost of customs administration on exports (Chad 1 container takes 101 days of work at USD8525 to export/ Singapore 4 days of work, cost USD425) and learning about the WCO Economic Competitive Package (ECP) aimed at facilitation.  Of course the best bit really is meeting such great people from all over the world has interested in customs issues as I am – nice to know I’m not the only sad person around!

I’m off to dinner with Marisa from Zambian Customs and a couple of guys from Vietnam.  Strange thing about Brussels – none of our hotel restaurants are open for evening meals because it’s the summer??!! – Anyway I’m sure we’ll find somewhere nice to eat.  And more trade facilitation to look forward to tomorrow.

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Tuesday, 2 July 2013

Inside the World Customs Organisation (WCO) (1) Arrived in Brussels – first impressions and Women in International Trade

Despite fate sending me a slipped disc and the flight being delayed by nearly an hour, I did make it to Brussels.  When I arrived at my hotel this afternoon I realised, as I checked in for 11 nights, that this will probably be the longest I've slept in the same bed for that many consecutive nights for years!  International trade is a great job – whichever area you’re in – but it does tend to turn us into nomads.

I was told the World Customs Organisation (WCO) buildings were just around the corner from the hotel and guess what – they are.  It took me exactly 6 minutes to get there – what to do now for the 3 hours before the Reception of the Women in International Trade?  Brussels seems a strange city – high buildings, glass sky-scrapers, concrete shopping malls and wonderful hidden gems like an old theatre 1920’s art nouveau style and the Notre Dame Chapel in the centre of a concrete shopping precinct.  I must find time to explore – just wish my French was better.  I keep thinking of German and Spanish words to say hello, thank you, etc … very confusing.

6pm and the Reception – or cocktail party as I fancifully called it - for Women in International Trade.  I know I’m a woman in international trade but things like this do make me cringe a little.  I mean, why not an event for men in international trade as well?  But I had to go – and I’m glad I did.  I am stupid – just because I've never felt held back or kept under by being a female just means I've been lucky or too stupid to notice and this is partly thanks to the society I grew up in, I suppose.  Other countries in the world are much more blatantly male-dominated (remember - we've only had one female Prime Minister, though!) but even in these developing markets women have made a significant mark on Customs Administrations. Which is quite exceptional because despite strong evidence of the vast benefits of women’s empowerment, in many parts of the world women remain poorer and lack access to the same opportunities as men.

Yet, somehow the areas of international trade compliance and customs authorities are seen as an acceptable job for women and many can made it into senior roles such as Ms Agnes Katsonga who is the Commissioner of Customs and Excise for the Malawi Revenue Authority, Ms Allen Kagina, Commissioner General, Uganda Revenue Authority and Ms Claudia Maria Gaviria, Customs Director General, Republic of Columbia, to name just 3. It is amazing how women in the developing world are becoming increasingly engaged in international trade. And economic empowerment of both men and women, supported by trade, can support positive social, economic and national revenue outcomes.

Even in the UK/EU I have seen how women are attracted – at all levels – to the job of customs compliance, import administrator, export controller.  Maybe I've never felt held back because I accidentally choose the right profession, though, to be more accurate, I should say the right profession choose me.  It was great meeting these men and women from different countries being able to find fulfillment and success in this area of business and government. Customs administrations play a key role in supporting trade facilitation and economic development in developing countries. Gender equality is, obviously, key to a country’s economic, social and democratic development as it generates higher growth outcomes and lower poverty so I won’t be so negative next time.

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Grumbling about …. DDP imports – the freight companies conspiracy

I heard a Customs official say that the way we import goods into the UK when they are sold as Delivered Duties Paid Incoterms Rule is “technically illegal” – come on guys, it’s either legal or it isn’t! 

Why illegal – well, if the Incoterms Rule DDP place of arrival is used in a contract then the selling is legally required to be named as the importer and pay all relevant customs duties and taxes (including VAT).  When shipping into the UK/EU this would mean that the overseas supplier is registered as an Economic Operator in the EU (in other words has an EORI). This, more often than not, is not the case so what legally should happen is the freight company carrying the goods into the UK should act under Power of Attorney on behalf of the exporter and make the declaration in their name against their EORI.  This would make the freight company the “Importer of Record” and therefore legally responsible for any errors or underpayment of duties.

BUT – what happens?  Well the freight companies don’t want to be legally responsible so they get the UK customers’ EORI – usually on the pretext of using it for VAT purposes (which is a different grumble rumbling) – and declare the goods at import with the Customer as the Importer of Record.  The forwarder, in their role as clearing agent, submits the entry to customs, often without checking how the customer would want them declared (well its DDP the customer has nothing to do with it!).  Hey presto, the UK customers is now the importer of record for something they have had no control over.

My advice – stop buying DDP and make a decision to take control of the import entry (eg change to Delivered at Place (DAP) named place of arrival) and take control of the freight forwarder.  Take control of declarations legally made in your name or insist on it being done correctly.

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