ISLAMABAD: In order to remove the hurdles in cross-border trade, Federal Board of Revenue (FBR) has decided to make rules regarding the Authorised Economic Operator (AEO) programme.
The outgoing government in budget 2018-19 inserted a new section in Customs Act regarding the AEO programme. The federal government may, by notification in the official Gazette, devise authorised economic operator programmer to provide facilitations relating to secure supply chains of imported and exported goods through simplified procedures with regard to regulatory controls applicable thereon.
The board may, with the approval of the federal government, prescribe rules on matters pertaining to authorised economic operator programme.
Member Customs Zahid Khakhar told Pakistan Today that “It is a World Trade Organisation (WTO) obligation and we were bound to implement this. We will study the developed countries model then we will prepare the strategy in next five years how can we become the members of World Customs Organisation.”
Another officer of Pakistan Customs told that we have studied the model of European Union and it is an extraordinary system. Pakistan can better its ranking in Ease of Doing Business by introducing the concept of AEO.
Presently, Pakistan does not have any AEO, the officer told Pakistan Today, but once the government is able to fulfil the requirements of the World Customs Organisation (WCO) then the FBR can issue AEOs licenses to businessmen who are associated with import and export business.
AEO status is a certified standard authorisation issued by customs administrations in the European Union (EU). It certifies that a business has met certain standards in relation to safety and security, systems to manage commercial records, compliance with customs rules, financial solvency and practical standards of competence or professional qualifications.
In addition to this, the company could benefit from recognition worldwide as a safe, secure and compliant business partner in international trade as an AEO certified trader. Moreover, the mutual recognition of AEO programmes under Joint Customs Cooperation Agreements could result in faster movement of goods through third-country borders.
Any economic operator established in the EU who is part of the international supply chain and is involved in customs activities can apply for AEO status, the officer further told the conditions for AEO status apply to all businesses regardless of size.
It is pertinent to mention here that WCO had introduced the security and safety term in European customs legislation after the September 11 attacks in New York. Enterprises involved in EU cross-border movements of goods and their suppliers were bound to comply with this legislation.