20 An exploration of the need for and cost of selected trade facilitation measures in Asia and the Pacific in the context of the WTO negotiations
place nationwide in most of the countries studied. The Indonesian study provides
a relatively detailed description of the risk assessment system in that country, indicating
that the development of the database on which the current risk management system is
based began in 2002. China aside, implementation of risk management systems in other
countries studied has been slow. In Nepal, only one customs office has a risk assessment
system in place. Post clearance audit, typically implemented as part of a risk management
programme, has also been introduced only recently there. In India, Customs has launched
a risk management system (RMS) on a limited basis at select customs ports. Based on
data from the EDI and other electronic trade documentation systems, ‘Star Performers’ are
to be identified, depending on their creditability and goodwill.
Express consignment clearance systems are in place in Indonesia as well as at
9 major customs offices in China. Other countries also have simplified or rapid clearance
systems, although these systems are sometime limited to shipments of perishable products
and a few other product categories, as in the case of Bangladesh (e.g., petroleum products,
relief goods). Importers can secure faster clearance of their good by making a security
deposit with Customs in advance of the arrival of the goods. However, this option is
generally not available in Nepal, except for certain raw materials. The WCO revised
Kyoto Convention and related guidelines appear to be used as references in most countries
studied, even when the countries have not ratified the Convention.
12. Tariff classification
The WCO Harmonized Commodity Description and Coding System, generally referred
to as “Harmonized System” or simply “HS”, is the 6-digit coding system that forms the
basis for tariff classification in all countries studied - Nepal, while not a contracting party to
the related WCO convention, did adopt the nomenclature. However, countries, or institutions
within countries, may not use or interpret the HS nomenclature in exactly the same way,
as is the case in India, for example. Countries also breakdown 6-digit level tariff lines into
non-standard 8-digit to 10-digit tariff lines to refine the classification.
A major issue emerging from the study is the large number of misclassification
(e.g., over 30 per cent in India) resulting from differences in interpretation of the nomenclature,
attempts by traders to declare under tariff lines with lower rates, but also attempts by
customs officers with often large discretionary powers to extract rent, as in Nepal. China
has recently launched an Advance Classification Ruling System, including publication of
rulings, to address discrepancies between classification of same goods depending on the
time and place of classification.
B. Measures related to GATT Article V
GATT Article V addresses matters related to goods in transit, including non-
discrimination of transit goods, disciplines on fees and charges, disciplines on transit
formalities and documentation requirements, and improved coordination and cooperation
amongst authorities and with the private sector.