Dagang Net Technologies Proposalfor the implementation of the

OIC Single Window

February 26th, 2013

Agenda

OIC Single Window Implementation Proposal

• About Dagang Net Technologies

• Lessons from other Cross Border e-Trade Initiatives

• Requirement Highlights

• Proposal for OIC Single Window

• Benefits

About Dagang Net Technologies

Corporate overview

Incorporated in

1989Incorporated in

1989Trade

Facilitation

TradeFacilitation

Government-Linked

Company

Government-Linked

Company

Malaysia’s

National SingleWindowOperator

Malaysia’s

National SingleWindowOperator

ExpertiseExpertiseInfrastructureInfrastructureExperienceExperience

Core competencies

Trade FacilitationPioneer

E-CommerceCommunity Builder

Private-PublicCollaboration

State-of-the–artFacilities

Integrated intelligentinfrastructure

Certified ISO/IEC27001:2005

Standards Development

National ICT StrategicConsultancy

240 staff strength

Community Building Experience

EDI Malaysiaestablished

EDI Malaysiaestablished

198919891st

CommunitySystem (CS)

1st

CommunitySystem (CS)

19941994

ePermitePermit

20052005ASEAN SW

National SW

ASEAN SW

National SW

20092009

FAMA 3P -WTO

Standards

FAMA 3P -WTO

Standards

20112011

AlignedDocumentation

System

AlignedDocumentation

System

19911991

ePCOePCO

20072007

ePermits forStrategicTrade Act

2010

ePermits forStrategicTrade Act

2010

20102010

Customs-DagangNet

System

Customs-DagangNet

System

19951995

Free ZoneCommunityFree Zone

Community

19981998

CS expansionNationwide

ElectronicFund Transfer

eManifest

CS expansionNationwide

ElectronicFund Transfer

eManifest

19961996

eManifestimplementation

for smallerports

eManifestimplementation

for smallerports

20122012

“THE LEADING COMMUNITY BUILDER THROUGH E-COMMERCE AND BUSINESS FACILITATION”

NATIONALSINGLEWINDOW

NATIONALSINGLEWINDOW

GovernmentAgenciesBack-OfficeSystem

GovernmentAgenciesBack-OfficeSystem

ASEAN SingleWindowASEAN SingleWindow

Forwarders

Importers -Exporters

Shippers

CUSTOMSCUSTOMS

Permit Issuing AgenciesPermit Issuing Agencies

Port OperatorsPort Operators

Port AuthoritiesPort Authorities

ASEANASEAN

BankBank

173173

2525

66

66

88

77

Lessonsfrom other

Cross Border e-Trade initiatives

IndonesiaASW

Server

IndonesiaASW

Server

MalaysiaASW ServerMalaysiaASW Server

Lessons from Regional Initiatives

ASW(Cross-Border)

e.g. ePCO

Member Country(Malaysia NSW)

Member Country(Indonesia SW)

Ministry of TradeIndonesia

CustomsCustoms

Business ValueSome initiatives have focussed ontechnical and legal areas, at times losingsight of the core value / requirements tobe delivered

Legal FrameworkWhile complex due to the plethora ofnational legislation, some initiativesexperience unnecessarily long delays inaccepting the validity of cross borderelectronic documents

Does Country B trust Country A’sTrusted National Domain?

Technical• Result of identified business value and processes, not the driver• Proven technology is readily available• “Central” architecture raises questions of:

o Privacy, confidentialityo Liability taken by operator of “central” systemo Who is the operator of the “central” system

GovernanceAcceptance of diversity of MemberCountriesClear approach on separation between

o Policy and Implementationo National and Regional matters

Dedicated “organizational unit” to driveoperation decisions and implementation

Proposal for OIC Single WindowBusiness ProcessesLegal Framework

Cross Border Trade – Simplified Overview

Potential Cross Border Business Processesthru the OIC Single Window

Facilitate PreferentialDuty Rates on Import -

country and rules oforigin

e.g. Preferential TariffScheme - PRE-TAS

Facilitate pre-arrivalclearance on imports

consignment info prior toloading – 24 hour rule; 4hour rule - housemanifest, bill of lading, airwaybill

Share export, importdetails - improveintelligence & risk

management

Health, Food, Community SafetyHalal certificates;Phyto-sanitary certificates; HealthcertificatesStrategic commodities

Authorized EconomicOperator (AEO) programs

Exchange status of AEO’s tofacilitate “green” lane

CommercialPurchase order,commercialinvoice, packinglist, letter of

credit….

Legal Framework forOIC Single Window

Acceptance of electronic documents /signatures with same legal standing aspaper, within national borders

In general, orFor specified documents to be exchanged cross border

Mutual Trust between secure NationalIT Domains of Member Countries

May be supplemented by External Security Audit of agreedsecurity criteriaSimilar to “trusting” paper documents issued andsubmitted by another government

Digital signatures and encryptionfor exchange between secure National IT domains, with two or more

keys / certificates for each Member Country

OIC Single WindowTechnical Concepts

OIC Single Window Technical Concept–1Distributed

OIC Single Window Technical Concept–1Distributed

Regional OIC ExchangeGateway in trusted National ITDomain of each Member CountryReliable, secure once-and-only onceexchange over the Internet Security(digital signatures, encryption,certificate management)

Documentformat

translationAudit trails

Tracking andReporting

Statistics toOIC Coordination

Services

OIC Single Window Technical Concept–1Distributed

OIC Coordination ServicesCollate and report on Statistics

On-board Member Countries and profilemanagement

Optional Mapping on behalf of Member CountriesOIC Document Structure Adoption and Promulgation

Coordination of Interoperability TestingChange Management

OIC Single Window Technical Concept–2Central

OIC Single Window Technical Concept–2Central

• Central Architectureappears simpler for eachMember Countryo Only one party to exchange

witho Can perform central

translation

• Each Member Countryo Still needs OIC Exchange

Gateway functionalityo Needs to assist in the

definition of the centralmapping

o May not want to sharetrade exchanges with anunrelated party• “Central” architecture

questionso Privacy, confidentiality?o Liability taken by operator of

“central” system?o Who is the operator of the

“central” system?

OIC Single WindowGovernance and Implementation

Approach

Challenges

• Decision Making and Collaboration amongstdiverse Stakeholders– Defining Business Value and Investment for Cross Border

Exchange• Infrastructure and Policy

• National

• Regional / Cross Border

– Acceptance of electronic documents / signatures• National

• Cross Border

Suggested Governance Structure forOIC Single Window Implementation

OIC Single WindowProject Management Methodology

OIC Single WindowImplementation Approach

Benefits

| © 2009 Axway | Allrights reserved.

26

Example Economic ImpactElectronic Certificate of Origin

Korea Chinese Taipei (APEC Study 1)

Korea ExportUS$/TEU Document

preparationCustomsclearance/ technical

control

Ports andterminalhandling

Inlandtransport/handling

Totals

Before e-CO $210 $175 $284 $584 $1,253

After e-CO $27 $84 $284 $584 $979

Improvement $183 $91 $0 $0 $274

Improvement% 87% 52% 0% 0% 22%

1APEC Study August 2011 - Reducing trade transaction costs in APEC through electronic commerce:A case study of Electronic Certificate of Origin (ECO)

| © 2009 Axway | Allrights reserved.

27

Example Economic ImpactElectronic Certificate of Origin

Korea Chinese Taipei (APEC Study 1)

Chinese Taipei– ImportUS$/TEU Document

preparationCustomsclearance/ technical

control

Portsand

terminalhandling

Inlandtransport/handling

Totals

Before e-CO $179 $355 $319 $313 $1,165

After e-CO $92 $44 $319 $313 $768

Improvement $87 $310 $0 $0 $397

Improvement%

49% 88% 0% 0% 34%

1APEC Study August 2011 - Reducing trade transaction costs in APEC through electronic commerce:A case study of Electronic Certificate of Origin (ECO)

Together we can achieve

FUTURETo facilitate trade growth

Together we can achieve

Reduced Trading TransactionCosts and Clearance Time

Improved Trading Efficiency andTransparency

New Opportunities

TradersTraders

Member CountriesMember Countries

Thank you