Introduction

The Customs in the 21st Century Strategy calls on Customs administrations to implement modern working methods and techniques.  In this context, Customs should be equipped with the necessary tools that allow it to effectively manage supply chain risks and enforce laws and regulations in cases of non-compliance.  Tools and instruments that improve risk management capabilities, inspection, investigation and enforcement techniques are fundamental to ensuring enforced compliance where necessary and that errant traders and travellers abide by the law.

In this regard, the WCO, in close co-operation with Members, has developed an extensive library of instruments, tools, guidance materials and operational co-ordination activities aimed at supporting all Customs compliance and enforcement actions.

Following the WCO’s new approach to the promotion and ongoing development of its instruments, tools, programmes and capacity building activities, the Compliance and Enforcement Package (CEP) has been developed in order to assist Members to address the high-risk areas for Customs enforcement.

The CEP Concept

The CEP Concept reflects the WCO’s approach in providing assistance to Members in their compliance and enforcement activities designed to address high-risk areas, while at the same time providing Members with a succinct compilation of the broad range of compliance and enforcement tools available from the WCO.

As part of the CEP Concept there are 4 key components that are highlighted: Partnerships, Technology and Infrastructure, Tools, and Operational activities, all revolving around 5 key risk areas for Customs Compliance and Enforcement.

 Risk Areas for Customs Compliance and Enforcement

In 2011, the WCO Policy Commission endorsed five key risk areas for Customs enforcement, namely, revenue assurance; drugs enforcement; health and safety/IPR; security; and environment. It directed the WCO Enforcement Committee to focus on these key risk areas and adopt a forward-looking strategy for managing emerging or evolving threats for Customs.

• Revenue risks include commercial fraud activities such as undervaluation, misuse of origin and preferential duties, misclassification, and drawback fraud. They also include revenue leakage through smuggling of highly taxed goods such as tobacco, alcohol and motor spirits. Trade liberalization and the increasing number of free trade agreements and free trade zones have added complexity to the international trading system. Customs is required to implement effective risk management and control strategies to mitigate threats that may hinder fair and efficient revenue collection and increase smuggling.

• Security risks in the Customs context often centre on phenomena such as terrorism, proliferation of weapons and materials of mass destruction, trafficking of small arms and explosives, and illicit diversion of dual-use goods. Customs plays a critical role in whole-of-government mitigation efforts in preventing trafficking of goods that are harmful, restricted or that pose potential security risks.

• IPR and Health and Safety risks in the Customs context relate to interdicting fake or counterfeit pharmaceuticals, other counterfeited and pirated goods, substandard items (such as electrical components and vehicle and aircraft spare parts), tainted foodstuffs, etc. These risks pose a serious threat to the health and safety and welfare of consumers. The WCO has implemented a strategy which builds on increased co-operation with right holders to raise awareness and increase detection capabilities through targeting techniques.

• Drug trafficking is the global illicit trade covering the cultivation, manufacturing, distribution and sale of substances which are subject to drug prohibition laws. Customs plays a leading role in co-coordinating efforts to combat and suppress cross-border drugs and precursors trafficking by applying innovative control methods, and co-ordinating regional and international interdiction operations.

• Environment risks in the Customs context relate to the illicit cross-border trafficking of endangered species, hazardous and toxic waste, ozone depleting substances and trading in indigenous or protected timber, etc. These phenomena threaten sustainable development and ecological balance.