CUSTOMS ATTRIBUTES DATA QUALITY – A BIG GAIN IF HANDLED PROPERLY, A HUGE RISK IF NOT
A company can have a very comprehensive mode of operation (MoO), a best in class enterprise resource planning (ERP) system and solid written processes, but all of that can be worthless if the customs attributes – also referred to as export control and customs (ECC) data – is not correct. Real risk exists not only when declaring goods crossing borders, but also when analysing product portfolios for customer offers, extracting data required to support purchasing processes and managing warranty aspects, to name just a few of the areas impacted by poor data quality.
Consider items such as tariff codes, export control classifications, country of origin, net and gross weight, unit value, line item quantities, meaningful item descriptions, international commercial terms (incoterms), consignee and country of export. Each has their own dynamic as to when they are available and become available but are still incorrect. In multinational corporations, the responsibility to define and maintain trade attributes is usually decentralised due to the nature of certain subjects and the knowledge split between multiple organisations. In addition to the organisational complexities, the customs attributes may be available at different points in the product lifecycle and end-to-end supply chain, understanding that the supply chain does not start at the actual moment of supply only.
So, companies must answer a number of fundamental questions. Do they have consistent and correct data to rely upon? Are they technically capable of defining their complete portfolio customs attributes? What about proactive data maintenance? If the answer to these questions is ‘no’, then they may be facing big risks. Companies could be subject to fines during border crossing activities through providing incorrect data to the authorities, have their goods indeterminately on hold affecting customer satisfaction, or have to pay extra for additional warehousing, legal advice, damage to the company’s reputation, and so on.
Oct-Dec 2019 Issue