The ICC recommendations are outlined in a recently released ICC discussion paper on mutual recognition between the US and the EU. Mutual recognition arrangements would allow the companies of one supply chain security programme to receive benefits similar to those conferred to companies participating in another country’s programme.
The paper, prepared by the ICC Commission on Customs and Trade Regulations in consultation with the Commission on Transport and Logistics, welcomes the adoption of a roadmap in March 2008 to improve border security by chartering steps toward mutual recognition of trade partnership programmes.
ICC calls for mutual recognition to be achieved as soon as possible without distorting trade flows. The paper acknowledges the release of an abridged version of the roadmap but strongly urges the governments to share the roadmap with the private sector and presses them to seek business input to shape the programme and ensure the suitability of the programme for all supply chain entities – in particular small- and medium-sized enterprises (SMEs). To avoid speculation and ensure suitability, the paper calls for the roadmap to quantify and track the benefits of trade partnership programmes.
ICC strongly supports the concept of mutual recognition of trade partnership programmes that balance border controls and trade facilitation. The ICC paper states that a successful US-EU mutual recognition programme would cover approximately 40% of global trade and could set a precedent that would improve both supply chain security and global trade facilitation.
The paper notes certain challenges to the attainment of mutual recognition. These include the fact that that the US Customs-Trade Partnership against Terrorism does not deal directly with export security, and the requirements of EU Authorized Economic Operator programmes to file separate applications and undergo separate verification processes for each incorporated legal entity in a group of related companies under common control.
ICC sets out recommendations in the paper on a number of specific business concerns, such as the need for interoperable electronic systems, proprietary data confidentiality and the need for SME flexibility.
The paper will serve as a basis for future ICC discussions with US and EU authorities.