Therefore, to some, relationship between WCO and other countries may be termed as sour especially given the fact that some regions are highly volatile in terms of a country’s stability and the regions within. Similarly, to some, issues that deal with narcotics and other illicit drug mar their relationships with WCO. In other cases, countries known to have high levels of production of counterfeit commodities masquerade and export/ import commodities that are substandard to unsuspecting buyers thus unscrupulously making gains while failing to adhere to WCO regulations. This tends to taint the figure of a country since most individuals tend to believe that such commodities define substandard production with China leading the pack (Granger 2011; Feaver & Wilson 2007).
However, according to World Customs Organization (2012), Saudi Arabia has continued to enjoy an astute relationship with WCO with various accolades accorded to the country for substantial steps in improving Saudi customs (World Customs Organization 2012; Al-Orf 2011). Further exemplification will be done later on in the paper.
In the succeeding section, there will be exemplification of the legal status of the WCO followed by the obligations that WCO member undertake, with recommendations on modalities, to ensure that these obligations are accorded full effect.
Current Status
According to Haughton and Desmeules (2001), the WCO has its headquarter in Brussels Belgium. Back in the year 1947, some 13 European countries came together and chatted on modalities of instituting a revision assemblage whose mandate was to scrutinize customs issues, which had been established by GATT (General Agreement on Tariffs and Trade). By 1950, the CCC (Customs Co-operation Council) was established, and the treaty engaged in Brussels (see World Customs Organization 2012, Jeremy 2012, Haughton & Desmeules 2001). This signing had to wait another three years for correct regulatory facets to be set in place including necessary checks and balances and other legal formalities (World Customs Organization 2012). In January 1953, the CCC was instated whereby 17 participating founding member states were represented (World Customs Organization 2012). For the succeeding four decades, the council remained under the same name (World Customs Organization 2012). However, as more member states joined in, the necessity for change of name was accentuated with the success achieved, whereby the council changed from CCC to its present-day name World Customs Organization, which was adopted in 1994 (World Customs Organization 2012). At the current status, the WCO controls over 98 % of all transnational vocation with only a handful of regions left toiling in the dark (World Customs Organization 2012).
Key Considerations/ Legal status of WCO
Being an internationally accolade body, the WCO has established its mandate as the universal center of imposts proficiency whereby they play a central role in discussion, promotion, development and enactment of novel customs procedures as well as systems (Feaver & Wilson 2007; World Customs Organization 2012). Given such vast experience in customs, WCO is ultimately responsive for an individual country’s needs and formulation of strategic environments for customs procedure and system maximization (De Beer & Smyth 2012). This is made possible via instruments formulated to aid in ensuing best practice in customs management for member countries, a possibility if rigorous customs supervision is maintained throughout the world (World Customs Organization 2012; Howse, van Bork & Hebebrand 2006; Steenblik 2007; Harmer 2009; de Beer & Smyth 2012).
WCO has received high accolades especially with regard to its work in regions that cover development of international conventions (Howse, van Bork & Hebebrand 2006), instruments (de Beer & Smyth 2012), and tools like commodity classification, rules of origin, supply chain security and customs enforcement activities (World Customs Organization 2012; Granger 2011; Feaver & Wilson 2007). Moreover, other topics under coverage by WCO include; valuation, collection of customs revenue, international trade facilitation, combating counterfeit commodities such that there is adept support of Intellectual Property Rights (IPR), integrity promotion coupled with delivery of sustainable capacity building such that there is assistance to customs reforms and modernization (World Customs Organization 2012).
WCO has established five legal instruments that aid in fulfillment of its mandate. First, according to the Global Concord on Harmonized Commodity Depiction and Coding Classification, famously dabbed as the HS Conversion, goods have to be coded with a predefined coding nomenclature (World Customs Organization 2012). This statute, by 1983 had been espoused but its implementation was to happen five years on in 1988 (World Customs Organization 2012). By definition, the HS versatile goods coding taxonomy is used as a foundation for customs rates as well as for collation of global trade indicators (World Customs Organization 2012). This coding system contains about 5000 different commodity groups, which are recognized by a six-digit cipher whose arrangement is in a permissible as well as logical manner with distinct rubrics that ensure achievement of uniform classification across the board (World Customs Organization 2012).
Second, there is the global convention on the popularization and synchronization of customs processes—popularly known as the RKC (Revised Kyoto Convention). However, there seems to be a higher propensity of erudite works to recline their arguments based on the assumption that RKC is related to the United Nations’ Kyoto Protocol (World Customs Organization 2012). However, it is imperative to delineate from such supposition since these two are incongruent (World Customs Organization 2012). The RKC was implemented in 1974 with subsequent amendment in 1999. This revised Kyoto agreement was implemented in 2006 (World Customs Organization 2012). RKC is made up of vital governing principles that include the need for transparency, as well as liability of customs controls, simplified procedures for authorized personnel, in addition to, use of risk management and audit based controls (World Customs Organization 2012). Moreover, calibration and vulgarization of the goods avowal as well as supporting documents, maximum utilization of information technology, coordination with other border based agencies, least obligatory customs control such that there is ease of compliance with regulations as well as a partnership within the trade (World Customs Organization 2012). This tool endorses trade assistance as well as real control accentuated by its lawful comestibles that delve in detail on simple yet effective procedures as well as containing newfangled and mandatory rules on modalities of application (World Customs Organization 2012).
Third, the ATA pact and the bond on impermanent admission is an instrument that allows free movement of merchandises within certain precincts across frontiers as well as possible momentary admittance into a customs’ territory with the possibility of relief from taxes and duties (World Customs Organization 2012). This happens for goods covered by a singular document dabbed ATA carnet, which is protected by an accredited worldwide assurance system (World Customs Organization 2012).
Fourth, the Arusha assertion on customs honesty of 1993 had its rudimentary principle as promoting integrity, in addition to, combating corruption within any given customs administration (World Customs Organization 2012). Al-Orf (2011) adds that Middle East region in the past has been marred/ tainted by high ranking in the corruption index leading to numerous withdrawal as well as copious unresolved corruption cases pending in the justice system.
Fifth, the SAFE Charter of standards to safeguard as well as expedite international trade was acknowledged and espoused in 2005 (World Customs Organization 2012). This SAFE Framework, however, happens to be a non-coercive framework/ instrument, which details the supply chain safety protocols, as well as facilitation on modalities for criterions for merchandises being transacted internationally (World Customs Organization 2012). This framework accentuates on assimilated supply chain administration in all approaches of transference ranging from road to rail to sea to air (World Customs Organization 2012). With such statutes, it becomes possible to strengthen networking arrangements especially amid customs governments in their ability to spot high-risk shipments (World Customs Organization 2012). Such efforts have been found to promote collaboration amongst customs and the corporate community, thanks to the AEO (Authorized Economic Operator) model (World Customs Organization 2012). This helps in championing for a unified movement of commodities via safe global trade supply manacles (World Customs Organization 2012).
Finally, WCO vehemently contributed in the administration platform by setting up several committees that include the Harmonized Structure Committee, the Procedural Committee on Customs Assessment, the Capacity Building Committee, the Permanent Technical Committee, Technical Commission on Rubrics of Derivation and the SAFE Employed Assemblage (World Customs Organization 2012). All these tools aid in improving customs best-practice procedures as well as facilitate customs competencies (World Customs Organization 2012).
Obligations undertaken by WCO members
The primary objective of WCO is to ensure efficiency, as well as effectiveness of member customs administration (Al-Orf 2011). Al-Orf contends with these ideologies adding that WCO assists member customs to contribute successfully in the national building within their individual jurisdictions with emphasis laid on revenue collection, trade facilitation, collection of trade statistics and national security, in addition to, community protection (World Customs Organization 2012). However, Jeremy (2012) posits that the most crucial role that the WCO plays is in the International Harmonized Systems (commonly adapted as Harmonized Systems (HS), which offers good nomenclature and administers is responsible in administration of the technical aspect of the World Trade Organization (WTO). Special emphasis on technical administration of the WTO is in the Agreements on customs valuation as well as Rules of Origin (Jeremy 2012, Howse, van Bork and Hebebrand 2006; de Beer & Smyth 2012).
The WCO has set some goals with an aim of concentrating fundamental in regions required. Additionally, these goals are meant to offer directions with appropriate strategies set up and adopted to ensure that such goals are followed by member countries.
First, it is expected that member countries practice international cooperation, in addition to, creating better platforms for information sharing between one custom agency to the next for ease of trade within relating regions (World Customs Organization 2012). This is made possible when member countries strategically join the global networked customs, introduce as well as continue to support pilot projects brought to fruition by improved communication platform (de Beer & Smyth 2012).
Second, it is anticipated that member countries will develop international standards that are in line with already established customs procedures as well as update their obsolete practices that tend to drag modern trading platform (de Beer & Smyth 2012). Al-Orf (2011) connotes that modern trading via e-trading initiatives raises complexities for which traditional and outdated systems can no longer host; thus the need to revise such systems.
Third, it is the expectation of member country that they will be able to deliver on capacity building (de Beer & Smyth 2012). In so doing, it will be possible to expand WCO development program as well as edify the delivery system of customs capacity building support structure (de Beer & Smyth 2012).
Fourth, it is required that every member country to put public health, safety as well as community protection as a fundamental priority (de Beer & Smyth 2012). In so doing, the current menace of drugs and precursors will be significantly reduced as well as proactively dealing with money laundering and counter terrorism by application of novel tools like forensic analysis tools that can proactively monitor systems and highlight malevolent activities within the system.
Fifth, security is a fundamental requirement since it facilitates confidence in international trade as well as in supply chain thus a country that is capable of ensuring security of products will gain enormously from international trade (de Beer & Smyth 2012). This leads to the sixth facet on revenue collection (de Beer & Smyth 2012). Revenue collection is brought to fruition with revenue packages, post clearance audit (PCA) and commercial fraud initiatives as an all-round program (de Beer & Smyth 2012).
Seven, it is anticipated that member countries will raise the banner of WCO through promotions and better marketing practices coupled with supreme research and analysis, good governance and proper resource utilization (de Beer & Smyth 2012).
Cautionary Notes
Al-Orf (2011) cautions on the volatility of surrounding member states with constant conflicts that flare-up and destabilize trade within the regions and abroad. Therefore, with Saudi’s titanic oil reserves, it is imperative to note that there may be higher inclination of malicious individuals within Saudi customs to engage in shady dealings thus the need for better monitoring and engagement policies (Al-Orf 2011).
Conclusion and Recommendations
In conclusion, it is clear that Saudi stands a better chance to improve its trade dealings if they would capture opportunities accentuated by the WCO. Al-Orf (2011) notes that, in the past, Saudi has been on the headlines with a failed system with corruption index accelerating within its precinct but such posits require substantial evidence. However, it is beneficial to consider the possibility of such dealings and to take a proactive step; rather than a passive step towards curbing the jeopardy.
There is a need for improvement in security within Saudi Arabia especially for suppliers as well as investors who may be considering business opportunities within the region.
Additionally, there is a need for improvement on public health and their safety especially on commodities that pass through customs. This will harness compliance with WCO statutes that govern WCO worldwide.
Bibliographic References
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