Last month, the EU unveiled proposals for a new initiative that will aim to make the process of customs filing more streamlined and up-to-date. Known as the EU Single Window Environment for Customs, this is intended to improve cooperation and coordination between different authorities and facilitate the automatic verification of non-customs formalities for goods entering or leaving the bloc.
It will mean businesses would no longer have to use several different portals to submit documentation to different authorities, and makes the first step of an ambitious plan to modernize border controls over the next ten years.
Commenting on the proposals, EU commissioner for the economy Paolo Gentiloni said: "Digitalization, globalization and the changing nature of trade present both risks and opportunities when it comes to goods crossing the EU's borders.
"To rise to these challenges, customs and other competent authorities must act as one, with a more holistic approach to the many checks and procedures needed for smooth and safe trade."
So what does the Single Window involve, how is it expected to work, and what are the challenges involved in implementing the proposals?
The reasons behind the proposals
The EU facilitates the movement of around €3.5 trillion worth of goods every year, and in 2018, more than 2,000 EU customs offices handled almost 343 million customs declarations, collecting €25.3 billion in customs duties in the process.
Therefore, efficient customs clearance and controls are essential in ensuring this trade flows smoothly. However, under current systems, there are a number of challenges and procedures that can act as barriers to this.
At present, goods entering the bloc are required to go through multiple formalities. In addition to a customs declaration, importers need to file paperwork related to health and safety, environment, agriculture, fisheries, international heritage or market surveillance depending on the nature of the goods entering the EU.
This fragmented system of border checks is both time-consuming and burdensome for importers and inefficient for authorities. What's more, it is also vulnerable to issues such as human error and fraud.
Without a solution such as Single Window, the EU warned that customs services and other border authorities will find it increasingly difficult to control and quantify goods coming in and out of the EU in a way that facilitates trade while also ensuring revenues are collected accurately.
It will also mean the EU would not be flexible enough to respond to unexpected challenges, while the EU would also risk losing out to its international trading partners, many of which already have a fully functioning Single Window system.
Putting the new system into practice
By digitalizing the customs filling process, the Single Window aims to remove much of this complexity. Under the new proposals, each national authority will replace the current multitude of filing processes with a single, more streamlined process.
To do this, however, each member state will be required to set up its own Single Window portals, through which businesses can upload the relevant information related to the goods they are moving in or out of the EU.
These portals will then be connected through a new EU digital framework to be put in place by the European Commission (EC), which will enable all relevant authorities to access the data and collaborate more easily on border checks in a single location.
The challenges facing the Single Window
However, this will be a large-scale project that will not be able to be completed overnight. It will require each of the EU's 27 member states to make significant investments in modernizing their systems, and need "firm commitment and buy-in from the many different authorities that work at the EU borders".
To make the Single Window a success, authorities will need to work together to agree on issues such as a governance framework, common IT solutions and an automated and integrated set of processes for the clearance of goods.
Therefore, the EC will look to support individual nations wherever possible, both technically and financially, including provided funding for the developments from its Recovery and Resilience Facility.
If these processes are implemented successfully, the EU will benefit from better interoperability between regulatory authorities, more harmonized use of data and fewer barriers to international trade. This will ensure EU customs processes are fit for the digital age and help protect EU citizens and the single market.