Ship comes home for customs

25 Sep 2003

Benjamin Franklin may have said that there are only two certainties in life, death and taxes, but for freight forwarding or shipping companies there is one other: customs declaration documents. Over the years these documents have been simplified and the EU now uses something called a single administrative document, or SAD, which is the uniform customs document.

The other major advance has been the use of IT in the customs service and 90pc of customs clearance documents in Ireland are now submitted electronically through the Revenue Commissioners’ Automated Entry Processing System (AEPS), the gateway to which is managed by Santry-based Icarus e-Com. And to make the process even more accessible, Icarus has developed a web interface called e-Customs.

Icarus was founded in 1988 to provide a link from the freight sector to the airlines. “We were originally owned by Aer Lingus, British Airways, Lufthansa and about 15 freight companies,” says Stephen Tracey, managing director. “Since then we have moved within the supply chain. We provide services some of which are mission critical, linking over 70 airlines for tracking and tracing, waybill transfer, electronic document transfer, electronic books and so on. In 1996, we embraced internet technology and started developing applications for people in the logistics and supply chain sector, particularly applications for inventory management, return of materials authorisation and so on.”

In 1999, the company won the contract to manage the gateway into the Revenue Commissioners’ AEPS. At that time there were — and still are — numerous customs clearance software packages on the market. These generate a message that conforms to the UN’s electronic data interchange standards, which is sent to the Revenue Commissioners via the gateway.

“We found that over a period of time, people were coming to us and saying they wanted to use the service but the cost of getting started is prohibitive, especially for sole traders or small to medium-sized enterprises [SME] that might only be clearing a few shipments per month,” says Tracey. “It really wasn’t possible to purchase the software and get trained in its use for less than €10,000 and for an SME that’s a lot of money. So, we developed an online application as an alternative to the conventional package and we operate it as an application service provider service with a per-transaction cost.”

“There are effectively three primary screens that people interact with,” explains Tony O’Grady, Icarus e-Com’s business development manager. “The queue screen that shows the queue of clearances for the day, the header screen that shows the first half of the first page of the SAD and has specific information such as value of the shipment, currency, origin, destination and so on.”

Many of the fields on the header screen are self-validated through drop-down menus or look-up tables. However, there is also a validate button, which the user can click and the system will validate the entry as a whole and try to anticipate likely errors.

The third screen is the tariff line screen, which has the commodity codes for the goods being shipped. There is a simple tax calculation facility included with the system. However, there are specific taxes with specific commodity groups. For instance, there is one commodity code for colour televisions, but the duty payable varies by the size of the screen. Users, therefore, have the option of overriding the automatic calculations.

So, just who is using e-Customs? “We originally anticipated that it would be expert users,” says Tracey. “A lot of freight companies have folded in recent years and the employees tend to resurface as customs practitioners. Given the start-up costs, we saw this as an attractive proposition and that has proved to be the case. What has taken us by surprise is that manufacturing companies are coming to us and saying that it makes sense for them to handle customs clearance in-house.”

The number of companies coming to Tracey that already had software packages installed also surprised him. “They wanted it to supplement their existing systems. They may want their employees to work from home or to have 24×7 access. For instance, a local company had a situation where an import came in and it had to be picked up in the morning. Previously the customs entry clerk would have to get out of bed, drive to Santry, open the office, fire up the computer, do the entry and hand over the paperwork to the driver who would then go down to the port and collect the goods. Now, their guy can clear the entry from his bedroom, phone the driver who prints out the SAD from his own PC and goes directly to the port,” explains Tracey.

The company is now developing an application program interface that will allow the larger companies to link their shipment processing systems directly to its e-Customs interface.

By David Stewart

Custom-made solution for Icarus e-Com: pictured (from left) Tony O’Grady, business development manager, and Stephen Tracey, managing director