Shipping goods from one country to another has always been a paper-intensive process. According to the Organisation for Economic Co-operation and Development, every container that crosses international borders generates 30 different documents. That adds up to roughly five billion documents a year.
But the EU, in partnership with IBM and the Free University of Amsterdam, plans to do away with all that paper, and instead have imported goods counted, monitored and evaluated for tax automatically, without producing a single sheet.
The first trial of the system will see 10 containers of Heineken larger transported from Holland and the UK to the US.
Underpinning this system is a combination of wireless RFID technology, used to monitor the containers in transit, and middleware to integrate the relevant nationally controlled databases.
The middleware allows national customs authorities to query each other’s system, finding details of incoming shipments and tracking outgoing ones. This federated approach ensures that each agency retains control over its own data.
Stefan Reidy, manager of Secure Trade Lane at IBM, believes the system could go on to form the basis of an ‘Intranet for Trade’. The beauty of the system, says Reidy, is that it could be extended through federation to include carriers and even manufacturers. The benefits of doing this stretch beyond the reduction in the administration costs of the paper work, he says.
“Let’s say you are a manufacturer of snow shoes, and you have a shipment heading to the US,” says Reidy. “Maybe you find out that there is a snow storm in Colorado. In that instance you could use the infrastructure to find out how far your shipment has gone, and redirect it to where it is needed most.”
Of course, no system can ever be 100% secure, but Reidy insists that this new approach is far more secure than the current paper-based one. “The data would be encrypted, and every organisation controls the access rights to its data.”
It may be some time before a new system is agreed on internationally. The US in particular, he says, still needs some convincing of the value of a federated approach – officials there would much rather do it all themselves.
“Somebody from the US Department of Homeland security told me that they wanted to build a giant database that all importers would put their trading information into. I told him that approach wouldn’t work, because other countries wouldn’t trust them with the data. Then he said ‘OK, we’ll get a third party to run it.’ I said they would trust a third party even less.”
“The only way to combine a separately owned and maintained database is to federate the data, so that everybody still has control over their own information.”