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APEC Project Database

Project Title

Study on Best Practices for Using New Technologies and Innovative Solutions in Cross-Border E-Commerce: Focus on Customs Risk Management System and Customs-Business Cooperation

Project Year

2024

Project Number

SCCP_201_2024A

Project Session

Session 2

Project Type

Standard

Project Status

Project in Implementation

Project No.

SCCP_201_2024A

Project Title

*
Study on Best Practices for Using New Technologies and Innovative Solutions in Cross-Border E-Commerce: Focus on Customs Risk Management System and Customs-Business Cooperation

Project Status

Project in Implementation

Fund Account

*
APEC Support Fund

Sub-fund

ASF: APEC Supply Chain Connectivity

Project Year

2024

Project Session

*
Session 2

APEC Funding

97,208

Co-funding Amount

2,055

Total Project Value

99,263

Sponsoring Forum

*
Sub-Committee on Customs Procedures (SCCP)

Topics

Customs; Electronic Commerce; Trade Facilitation

Committee

Committee on Trade and Investment (CTI)

Other Fora Involved

Other Non-APEC Stakeholders Involved

 

Proposing Economy(ies)

Korea

Co-Sponsoring Economies

Japan; Peru; United States

Expected Start Date

01/01/2025

Expected Completion Date

30/06/2026

Project Proponent Name 1

Hong Ik Kang

Job Title 1

Deputy Director, External Relations Division

Organization 1

Korea Customs Service (KCS)

Telephone 1

+82-42-4813215

Email 1

Project Proponent Name 2

Not Applicable

Job Title 2

Not Applicable

Organization 2

Not Applicable

Telephone 2

Not Applicable

Email 2

Not Applicable

Declaration

Hong Ik, Kang

Project Summary

Since the COVID-19 pandemic, cross-border e-commerce has surged, with global volume more than tripling from $233 billion in 2014 to $785 billion in 2021 (Statista, 2024).

This project aims to build on the low-value shipment project from last year to continue to explore ways to enhance APEC customs administrations’ capacity to process large e- commerce volumes quickly and securely.

It includes a survey of customs administrations in each economy and a workshop in Korea to share best practices. The survey will collect cases of key topics of the workshop, import facilitation, risk management, data requirements, technology solutions and revenue collection by economies.

The workshop will identify systems suitable for e-commerce customs and share best practices among participants. The knowledge/solutions presented will be compiled into a report and made available to APEC members.

This project will be most effective in assisting APEC economies who are facing challenges like customs clearance delays and illegal goods entry, bridging the gap in customs environments among APEC members.

Relevance

Region

APEC economies have seen rapid growth in cross-border e-commerce, driven by diverse goods, competitive prices, advances in global freight, and changing consumer trends.

Many APEC region-based e-commerce platforms have entered into the global market, and online shopping events such as Single's Day, Cyber Monday, Prime Day have exploded in popularity around the world. Unlike traditional trade, cross-border e- commerce involves B2C trade, small volumes, multiple orders, individual shipments, and real-time transactions, significantly changing the traditional trade environment.

The increase in customs clearance volumes due to cross-border e-commerce presents new challenges for APEC customs administrations. Issues such as logistical congestion due to clearance delays and the entry of illegal goods taking advantage of simplified customs procedures require the affected economies to take advanced measures. These include but are not limited to upgrading of customs facilities, improving of risk management systems, introducing of clearance software, and forging cooperation between customs and businesses.

Against this backdrop, this project aims to build on previous related projects to support customs capacity and innovative environments that facilitate cross-border e-commerce logistics while effectively monitoring illegal trade. APEC economies facing challenges arising from clearance logistics will benefit from participating in the project by sharing their challenges and joining together to identify skills and solutions to address those challenges.

Eligibility and Fund Priorities

The priority of the APEC Support Fund on Supply Chain Connectivity (ASF SCC) is to support APEC developing economies to improve supply chain performance.

This project is eligible for the SCC Fund because it follows the key principles of the fund, and it can contribute to implementation of the principle: 10% improvement in supply chain performance and yield reductions of time, cost, and uncertainty of moving goods and services through the region, by finding solutions to reduce congestion and delays at customs that will save trade time and costs across supply chains of e-commerce, especially for developing economies.

A self-assessment survey could be conducted to gather economies’ views on improvements in supply chain performance achieved through the implementation of the project's experiences, providing a measure of performance status.

Capacity Building

APEC economy. Ensure that these economies are identified.

The rapid growth of cross-border e-commerce has caused a variety of problems that have highlighted the importance of effective customs administration. Advanced facilities and systems tailored to each economy are needed to address problems such as delays in customs clearance caused by the rapid growth in volume and the entry of illegal goods exploiting simplified customs procedures.

APEC economies facing such customs challenges will be surveyed to identify the current 
status and customs issues related to e-commerce. The survey will help pinpoint specific problems and establish tailored facilities and systems. The workshop will then share Korea's expertise in advanced customs administration, such as automated facilities, advanced clearance systems, and customs-business cooperation, customized to each economy's needs identified in the survey.

This project will be helpful to promote rapid customs clearance through cooperation such as logistics facilities, advanced customs clearance system, and prior data exchange between customs and business operators, and can perform reliable customs clearance by analyzing, and drawing practical implications from actual cases of establishing a risk management system.

In addition, APEC developing economies can expand the e-commerce market by strengthening customs clearance facilitation capabilities, which are expected to play an important role in economic development.

Objectives

The main objective is to support e-commerce trade facilitation by creating a customs clearance system that effectively prevents logistical congestion while monitoring illegal trade.

The project aims to identify best practices for managing e-commerce and disseminate skills/solutions among APEC economies. These include but are not limited to logistics centers, automation facilities, monitoring equipment, electronic clearance, data processing, integrated systems, and customs-business cooperation.

To this end, the workshop will provide an opportunity for customs administrators to exchange knowledge and experiences, enabling participants to build on previous related workshops to advance and strengthen customs responses to increasing volumes of e- commerce.

Alignment

APEC

The APEC Putrajaya Vision 2040, which outlines APEC's goals following the Bogor Declaration, includes a concerted effort to create a free environment for trade and investment in its first driver “Trade and Investment”.

The project aligns with this first driver of the vision and the project will assist APEC economies in achieving the vision by sharing and acquiring expertise, new technologies and knowledge to improve the seamless flow of cross-border e-commerce, ultimately facilitating trade and sustainable growth of APEC economies.

In addition, the project is related to the overarching goal for the APEC Phase Three of Supply Chain Connectivity Framework Action Plan (SCFAP III), which is “To support our businesses in building secure, resilient, sustainable and open supply chains that create a predictable, competitive and digitally interconnected Asia-Pacific region for all.”

This project will endeavor to support the plan's goal by focusing on enhancing the customs capacity on cross-border e-commerce to address challenges, mitigate risks, and streamline processes, thereby facilitating smoother trade flows and fostering the development of the interconnected APEC regional economies.

Forum

The CTI strengthens cooperation among APEC economies on global trade and investment and pursues opportunities to liberalize and expand trade and improve the flow of goods within the region. The SCCP, a sub-group of the CTI, focuses on trade facilitation, trade security and other enforcement issues, emphasizing the responsibility of customs administrations to ensure the efficient implementation of lawful border measures. In this regard, the SCCP Strategic Plan 2022-2025: Priority 3 identifies as key challenges the harmonization of customs procedures between APEC economies to facilitate trade and improve supply chain predictability, as well as the promotion of paperless trade and the digitization of customs processes.

As one way to promote the trade facilitation envisioned by Forum and the Strategic Plan, this project is designed to encourage the exchange of best practices and discussions on innovative ways, including the use of new technologies, to create an efficient environment for cross-border e-commerce customs, which has become an important part of international trade.

Beneficiaries and Outputs

Output

1) Research Report

1. Purpose: The purpose of this research report is to identify the key challenges and customs-related issues faced by APEC member economies, especially developing economies, during the introduction and promotion of e-commerce. The report aims to propose strategic solutions to address these challenges, thereby contributing to the enhancement of customs capabilities to facilitate cross-border e-commerce logistics. Additionally, the report seeks to strengthen cooperation among APEC member economies to promote digital trade and improve supply chain performance. The report will be produced in an electronic format, and circulated to workshop participants before the workshop.

2. Authors: The research report will be written by a research contractor in collaboration with the Project Overseer’s (PO) team, which includes experts in this field. 

3. Methodology: The report will be developed based on data collected through an online survey. The surveys will be distributed to all APEC member economies and will focus on the current status of e-commerce, customs procedures, issues, and possible solutions in each economy. Moreover, the report will highlight best practices in e-commerce from various member economies. This approach will facilitate the sharing of experiences among members and help them adopt appropriate technologies and systems suited to their respective needs. 

4. Expected Outcomes: This report will outline concrete implementation plans to strengthen the customs capacities of APEC member economies, particularly developing economies, to promote cross-border e-commerce.

Through this, member economies will be able to improve their customs procedures related to e-commerce and establish faster and more efficient logistics processes. Additionally, the report will serve as a key resource for future projects and policy development aimed at enhancing cooperation among APEC member economies and promoting digital trade. 

5. Length : The minimum length of the report will be 15 pages, excluding annexes 

6.  Contents

1) Overview of key E-commerce challenges in APEC economies, 2) Summary of main customs and logistical obstacles impacting cross-border e- commerce, based on the survey result, 3) Initial analysis of e-commerce policies and strategies by APEC economies, 4) Case studies of customs and logistical challenges faced by APEC economies in cross-border e-commerce.

5) Proposed next step and focus areas: Outline of key actions for future phases, including workshop.

2) Workshop (1-Day, APEC-Funded)

1.  Purpose: The objective of this workshop is to share Korea’s advanced knowledge and expertise in customs administration, specifically addressing the identified needs of APEC member economies for automation systems, pre-clearance systems, and cross-border customs cooperation. The workshop aims to enhance the customs capabilities of APEC member economies, particularly developing economies, facilitate cross-border e- commerce logistics, and improve overall customs efficiency. The aim of the workshop is to provide insight on the way forward. In this regard, the project will build upon previous works on this subject matter to avoid duplication or overlap. One of the works reflected in the study was the project conducted by the US, which was discussed during the workshop in Lima in August ("SCCP 04 2022S Promoting MSMEs Engagement in E- Commerce on Regulatory Procedures for Small, Low-Value Shipments"). 

2.  Target Participants: The workshop is primarily designed for customs officials, policymakers, and trade experts from APEC member economies, with a focus on developing economies. Additionally, representatives from the logistics and e-commerce industries, as well as academic experts, are encouraged to participate to exchange knowledge and experiences broadly. 

3.  Workshop Structure: a) Duration: 2 days (Day 1: Full-day Workshop (7-8 hours), Day 2: 'Exhibition on Innovative Technologies in Customs(self- funded), b) Format: The workshop will be held in person and consist of presentations based on the findings of the research report, case study discussions, and interactive sessions. Each session will focus on a specific aspect of advanced customs administration, providing participants opportunities to engage in discussions and share experiences. c) Location: Incheon, Korea (Workshop, Exhibition & Case presentation Venue : Incheon Songdo Convensia - same building, by walking distance) (d) The 'Exhibition on Innovative Technologies in Customs' takes place after workshop, showcasing 'technologies tailored to the on-site customs administration'. 

The 'Exhibition on Innovative Technologies in Customs' takes place after workshop, showcasing 'technologies tailored to the on-site customs administration'. Moreover, those technologies and products are not for any commercial purpose or promotions of them. 

At the exhibition, participants of the workshops will be invited on a visit to Exhibition to experience advanced equipment firsthand. The project aims to foster capacity building and advancement of Member economies with Q&A sessions during the visit and time set aside for presentations and discussions afterwards. 

The exhibition will showcase 7 areas in innovative technologies: ①passenger verification (facial recognition), ②Terahertz body scanner, ③X-ray training program, AI-based tracking system for high-risk passengers, ④Passenger selectivity based on biometrics, ⑤Express cargo processing, ⑥Big Data, and

⑦Risk Management. Areas and technology that are highly applicable to on- field customs work as well as easy to demonstrate for participants, will be selected. 

4.  Workshop Agenda:

Day 1 Full-day workshop

09:30 - 10:05 Opening remarks and Introduction

i)  10:05 – 10:40 Project Overview and State of E-commerce in APEC

ii) 11:00 – 12:00 Smart Customs Administration for E-commerce Facilitation

iii) 12:00 – 13:30 Lunch Break

iv) 13:30 – 14:45 New Customs Technologies and Digitalization for Supply Chain Security

v)  15:05 – 16:20 Enhancing Cooperation in New Customs Technologies to Move Forward

vi) 16:20 – 16:40 Wrap up of meeting and post evaluation Tentative Program (Exhibition)

Day 2 (Exhibition - self-funded)

09:00-09:50 : Welcome and opening of meeting 09:50-11:10

Visit to Exhibition hall

- Presentation of innovation technologies for the subject program adopted by Korea Customs Service(KCS)

- Sharing KCS' experiences and best practices in utilization of Customs technologies

- showcase1 : Passenger verification(facial recognition)

- showcase2 : TeraHertz body scanner

-  showcase3 : X-ray training program

-  showcase4 : AI-based tracking system for high risk passengers

-  showcase5 : Express cargo processing technologies

-  showcase6 : Customs Big data analytics

-  showcase7 : Risk management 11:30-12:30

Group discussion and sharing outcome of the visit 14:00-16:30

Case presentations by APEC member economies 16:30-17:00

Wrap up and Participants' comment & Announcement 

This workshop will serve as a platform for developing practical strategies to address customs-related challenges, promote cooperation among APEC member economies, and ultimately improve the efficiency and transparency of cross-border e-commerce logistics. 

5. Event Evaluations

a) A ex-ante evaluation will be conducted before the workshop begins to gather information regarding participant expectations and knowledge; and

b) A ex-post evaluation will be conducted after the workshop is completed to assess participant satisfaction and key takeaways.

3) Project Summary Report

1. Purpose: The purpose of this project summary report is to consolidate the key points discussed and presented during the workshop, sharing best practices of new technologies and innovative solutions in e-commerce among APEC member economies. This will serve as a valuable reference for each economy to enhance its e-commerce activation and customs efficiency.

Particularly, the report aims to provide actionable strategies for strengthening the e-commerce and customs capabilities of developing economies. 

2. Table of Contents: 1) Introduction (Project Overview, Background, and Purpose of the Report), 2) New Technologies and Innovative Solutions for E- Commerce (Summary of Workshop Presentations, Best Practices from Different Economies), 3) Economy-Specific Strategies for E-Commerce Activation (E-Commerce Policies and Strategies by Member Economies, Tailored Approaches for Developing Economies), 4) Improving Customs Procedures and Logistics Efficiency (Analysis of Best Practices, Automation of Customs Procedures and International Cooperation), 5) Future Cooperation and Action Plans within APEC (Collaboration Strategies among APEC Member Economies, Follow-Up Actions and Policy Recommendations for Sustainable E-Commerce), 6) Conclusion (Project Outcomes and Expected Benefits, Capacity Building and Long-Term Cooperation among Member Economies). 

3.  Publication: The project summary report will be an APEC publication. 

Length: The minimum length of the report will be 15 pages, excluding annexes

Outcomes

1) Enhancing Trade Facilitation Capacity of APEC Economies: This will bring about improvements in the trade facilitation capabilities of participating economies by helping them manage and implement customs-related elements more efficiently.

2) Improved Supply Chain Predictability and Connectivity: Through the harmonization and digitalization of customs procedures, the project will enhance the predictability of supply chains within the APEC region, leading to safer and more efficient supply chain operations.

3) Strengthened Supply Chain Security through Technological Innovation: Participants will understand and apply new technologies and innovative solutions to improve border management and supply chain security, resulting in enhanced security measures.

4) Creating an Inclusive Trade Environment: The project is expected to foster a more inclusive trade environment, leading to policy changes that make it easier for small businesses to access trade opportunities.

5) Capacity Building and Sharing of Best Practices: The project will enable economies to share best practices related to trade facilitation and supply chain security, while also benefiting from tailored capacity-building programs that improve domestic policies. These outcomes will contribute directly to participants improving their customs and trade procedures, thereby enhancing the resilience and security of global supply chains.

Beneficiaries

The direct beneficiaries of the project will be the government officials from the customs administrations in APEC economies, especially developing economies, responsible for managing the flow of cross-border e-commerce and addressing the customs matters. They will have the opportunity to discuss best practices and gain diverse perspectives and knowledge on how to innovate customs systems in response to the expansion of cross-border e-commerce.

Improvement of the customs environment in APEC economies will also facilitate the overall flow of e-commerce trade, bringing a range of secondary benefits to e-commerce platforms, sellers, and consumers alike, including more stable logistics, cost reduction, and faster delivery.

Dissemination

The project’s outputs and deliverables will be disseminated through various channels to ensure they are effectively communicated to relevant stakeholders. 

The key elements of the dissemination strategy are as follows:

1.  Number, Form, and Content of Publications: Project summary Report will be made available in electronic format to promote wide distribution and accessibility among APEC member economies. The publication will be uploaded to the ‘APEC website’, and member economies will be encouraged to share the report through their own government portals. Additionally, we plan to disseminate the report through the ‘CTI’ and ‘SCCP’ members, as well as to workshop participants. 

2. Primary beneficiaries: The main beneficiaries include customs and trade-related officials, policy makers, and business leaders in the trade and logistics sectors from APEC member economies. Each report will also be structured to ensure practical application by customs officials and trade experts in both developed and developing economies. 

3. Intention to Sell Outputs: There is no intention to sell the outputs of this project. All materials will be provided free of charge to relevant stakeholders, ensuring broad access and impact across the APEC region. 

This dissemination plan will ensure that the project’s outputs are effectively communicated to the key beneficiaries, fostering further collaboration and capacity building among APEC member economies. It also aligns with APEC guidelines, with the goal of making the materials as accessible as possible to all relevant stakeholders.

Gender

Please see Project Proposal in Supporting Documents folder.

Work Plan

Please see Project Proposal in Supporting Documents folder.

Risks

Please see Project Proposal in Supporting Documents folder.

Monitoring and Evaluation

Please see Project Proposal in Supporting Documents folder.

Linkages

The project can contribute to one of the priorities of the Small and Medium Enterprises Working Group (SMEWG), which is to help SMEs access the global marketplace, by facilitating customs clearance for SMEs engaged in cross-border e-commerce.

The project objectives are also closely linked to the goal of the APEC Internet and Digital Economy Roadmap (AIDER) of the Digital Economy Steering Group (DESG) to facilitate e-commerce and digital trade, and could be aligned with the activities of AIDER, e.g. by discussing electronic and digitized clearance in the workshop.

In order to build linkages between the different groups, the members of SMEWG and DESG will be invited to the workshop to share their agendas and experiences. For reference, the Research Report and Project Summary Report will also be shared with these groups.

The aim of the project is to provide insight on the way forward. In this regard, the project will build upon previous works on this subject matter to avoid duplication or overlap. One of the works reflected in the project is the U.S. project ("SCCP 04 2022S Promoting MSMEs Engagement in E-Commerce on Regulatory Procedures for Small, Low- Value Shipments"), which was discussed during the workshop in Lima in August 2024.

Sustainability

We plan to ensure that beneficiaries continue to leverage the results and lessons learned from the project even after its completion. 

To achieve this, we will maintain ongoing cooperation with relevant institutions and stakeholders in each economy by: 

1.  Providing access to project materials, outcomes, and best practices to support the implementation of the project’s experiences in each economy. 

2.  Follow-up Actions and Sustainability: After the project is completed, we plan to explore follow-up actions based on the improved systems and technologies established by each economy. For instance, we may consider leveraging Korea’s ODA(official development assistant) funds to explore options for ongoing support for economies that require continued capacity building and wish to adopt these systems. 

3. Sustained Performance and Impact Evaluation: To ensure the project is not a one-time effort, we will systematically measure progress on outcomes and impacts. We will establish specific, measurable performance indicators aligned with the project’s sustainability goals as part of the post-evaluation and conduct ongoing monitoring using ex-ante and ex-post evaluations to assess performance before and after the workshop. These efforts will help ensure alignment with the project’s initial objectives and support the successful achievement of long-term goals.

Direct Labour

Please see Project Proposal in Supporting Documents folder.

Are there any supporting document attached?

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Project No.
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