Who benefits most from AEO certification?
An Austrian perspective
Hans-Joachim Schramm1
Abstract
In this paper, the Taxation and Customs Union Directorate-General (European Commission) (TAXUD) A uthorid Economic Operator (AEO) Databa was employed and supplemented with company data to develop a census of AEO certifications per company size (in terms of employees and revenue) and export/import quotas in the ca of Austria 2008-2013 in order to determine who benefits most from AEO certification. Findings can be simply summarid as follows: the more export-orientated a ctor is, the more AEO certifications are granted. More specifically, about 49% of all AEO certifications in Austria are granted to companies from the manufacturing industry, followed by about 29% to transport and logistics rvice providers and 18% to wholesale or retail companies. Others such as the primary ctor, energy provision and rvice industries are negligible. Looking more cloly at the Austrian AEO certified companies, most of them from the manufacturing industry can be classified as ‘SME’ in the European Union (EU) n but are being heavily export-orientated at the same time and in need o
f an AEO certificate to smooth their export/import operations. Transport and logistics rvice providers do benefit from AEO certification, too, but are being pushed to apply for certification by their customers.
1. Introduction
Initiated by the World Customs Organization (WCO) as a part of the WCO SAFE Framework of Standards to Secure and Facilitate Global Trade(SAFE Framework) of 2005 (WCO 2007; Ireland 2009), the voluntary Authorid Economic Operator (AEO) concept received worldwide adoption. By March 2014, 168 out of 179 WCO Members had signed letters of intent committing to implement the SAFE Framework and a total of 64 AEO programs were already operational or would soon be launched (WCO 2014).
One of the programs is the uniform concept of European Union (EU) AEO as one of the main elements of the Security Amendments to the Community Customs Code (CCC, Regulation EEC/2913/92) with Regulation EC/648/2005 of 12 April 2005. After a pilot study conducted in 2006 (Weerth 2007; Wolffgang & Natzel 2007; TAXUD 2012), the EU introduced AEO certification procedures for the 27 EU Member States at that time with Regulation EC/1875/2006 of 18 Decembe
r 2006 amending the CCC Implementing Provisions (CCIP, Regulation EEC/2454/93). This part of the Security Amendments was then brought into force on 1 January 2008, and after six years, there are now about 12,000 certified AEO operators registered in 27 of 28 EU Member States who potentially benefit from customs simplification and curity facilitation (TAXUD 2014).
Referring to empirical work about EU AEO and other comparable voluntary curity initiatives worldwide, the constant flow of surveys about the US C-TPAT and/or Canadian PIP (La Londe 2002;
DAMF Consulting 2005; Sheu, Lee & Niehoff 2006; Peleg-Gillai, Bhat & Sept 2006; Diop, Hartman & Rexrode 2007; Haughton 2007; GAO 2008; V oss & Williams 2013; Melnyk, Ritchie & Calantone 2013), Latin American BASC Programme (Gutiérrez, Hintsa, Wier & Hameri 2009), or Swiss AEO (Granqvist, Hintsa, Lazarescu & Rsikolneko 2010) is remarkable. In the ca of the EU AEO program only a few investigations are identifiable and many of them can be regarded as purely narrative (for example, Janowska-Bucka 2008; Burgemeestre, Hulstijn & Tan 2009; Houe & Guimaraes 2012; Biljan 2014) to anecdotal (for example, Lui, Tan & Hulstijn 2008; Jackson 2011). However, some recent empirical studies dealt at least partly with AEO implementation issues and were published in Germany (Materna et al. 2009, 2010), the Netherlands (den Butter & van Scheltinga 2008), Sweden (Uricuoli 2010; Uricuoli & Ekwall 2012) and by the EU (Lejeune, Tusveld,
Aerts, Wagemans, Bogaerts & Buysing Damste 2013). In addition to this, Polner (2010, 2011, 2012) and Weerth (2011) commented on the progress of voluntary curity programs like the EU AEO.工作情况汇报怎么写
In principle, an EU AEO certification ems to be beneficial for all companies exporting and importing goods from/to the EU (Wolffgang & Natzel 2007; TAXUD 2012; Polner 2012). This paper relates to who really benefits the most from AEO certification, or more particularly, what are the main characteristics of companies with AEO certification in the ca of Austria.
First, some background is provided about the AEO certification on the EU level and its implementation in Austria before results of an explorative data analysis of companies listed in the TAXUD AEO Databa are prented and discusd. The paper clos with some concluding comments and further rearch implications.
2. Background
On the basis of Article 5a of the curity amendments to the CCC, AEO status can be granted to any economic operator meeting the common criteria of (1) record of compliance with customs requirements, (2) satisfactory system of managing commercial and, where appropriate, transport records, which allows appropriate customs controls, (3) proven financial solvency and, (4) where rele
vant, appropriate curity and safety standards (Wolffgang & Natzel 2007; TAXUD 2012; Polner 2012; WCO 2014).
AEO status is then granted in the form of a certificate as laid down in Article 14a (1) of the CCIP. According to the AEO Guidelines (TAXUD 2012) ‘the AEO status shall be recognid across all Member States, pursuant to Article 5a of the CCC, therefore, the holder of an AEO certificate shall receive the same benefits in all Member States’. The benefits are also summarid in the AEO Guidelines:
• easier admittance to customs simplification怎么裁剪图片
• prior notification
• reduced data t for entry and exit summary declarations
• fewer physical and document-bad controls高血压什么不能吃
• priority treatment of consignments if lected for control
• choice of the place of controls
• indirect benefits such as more transparency and visibility of the supply chain
• recognid as a cure and safe business partner
• improved relations with customs authorities
• improved relations and acknowledgment by other government authorities.
In Austria, the application procedure for AEO certification is then outlined in the working practice guideline ZK-0051 (BMF 2013), which also specifies in more detail the abovementioned benefits for companies with AEO status bad on the AEO Guidelines.
In addition to the directly granted trade facilitation benefits, AEO certification also offers economic advantages, which may be due to reduced costs and streamlined process in daily export/import operations. In addition, AEO status can give a competitive advantage over non-certified competitors: whenever there is a need to lect between different suppliers or rvice providers, AEO certified companies might prefer an already AEO certified partner, as Customs regard them as a lower risk if all members of their supply chain have AEO status. This is especially true when we think about mutual recognition of AEO status like the US-American C-TPAT program (Aigner 2010; Szelp 2010).
3. Data sampling and results on the EU-level
The TAXUD AEO Databa (TAXUD 2014) was the starting point for further inquiry. It contains a list of tho AEOs who agreed to disclo their name, along with their certificate type, issuing country, competent customs authority and effective date they received their AEO status. By the end of 2013 a total of 11,957 AEO holders from 27 EU Member States were recorded in the TAXUD AEO Databa with 5,342 or 44.9% of them being registered in Germany (e Tables 1 and 2).2 Furthermore, the large number of AEO certificates issued in 2011 is remarkable. This came about with the introduction of some real benefits for AEO holders in the EU in January 2011, for example, electronic entry summary declaration, allowance of reduced data requirements, etc. (Weerth 2011). In 2012 and 2013, less AEO certificates were issued than in 2011 which indicates that the first run for AEO certifications is over. Concerning the type of AEO certification, at the end of 2013 there were 6,200 (51.9%) companies with AEO-F status (that is, full or customs, curity and safety) and 5,358 (44.8%) with AEO-C status (that is, customs only) in the EU (e Table 1). This is pretty much in line with the trend Weerth (2011) already commented on: the status of AEO-C is gaining importance as it is somehow an ‘AEO light’ for companies which are mainly interested in simplified procedures within the EU customs system (e Table 2).
Table 1: AEO holders in EU27 end of 2013 by year of receiving their AEO status EU27
200820092010201120122013Holder of AEO-C 75(17.9)286(17.2)1,117(29.2)3,516(45.0)4,821(45.8)5,358(44.8)Holder of AEO-S 9(2.1)43(2.6)122(3.2)215(2.7)301(2.9)399(3.3)Holder of AEO-F 335(80.0)1,333(80.2)2,587(67.6)4,091(52.3)5414(51.4)6,200(51.9)TOTAL
419
1,662
3,826
7,822
10,536
11,957
Table 2: Ranking of AEO holders in EU27 in 2010 (Weerth 2011) and 2013 (TAXUD 2014).AEOs in 2
0101st 2nd 3rd 4th 5th 6th 7th 8th 9th all DE NL FR IT PL SE UK ES AT others #1,413430361332289251209152146573%34.010.38.78.07.0 6.0 5.0 3.7 3.513.8AEOs 1st 2nd 3rd 4th 5th 6th 7th 8th 9th all in 2013DE NL FR IT PL ES GB SE BE others #5,3721,3399507786545493313223211,339%
44.9
11.2
7.9
6.5
5.5
4.6
香瓜七兄弟2.8
2.7
2.7
11.2
4. The Austrian perspective
In Austria, more AEO-F and less AEO-C holders registered compared with the EU27 on average with 85 (34.1%) AEO-C and 163 (65.5%) AEO-F certifications by the end of 2013 (e Table 3). Regarding spatial distribution of AEO certificates by AEO Competent Customs Authorities (with their range of operations being almost identical with the Federal States of Austria), 57 (22.9%) of the 249 AEO certificates were issued at Salzburg, 48 (19.3%) at Vienna and 41 (16.5%) at Lower Austria. This reflects spatial distribution of the Austrian economy pretty well, especially when we look at manufacturing, transport and logistics company activities.
For each Austrian AEO holder listed in the TAXUD AEO Databa at the end of 2013, company-specific data like main field(s) of business activity, annual turnover, number of employees, export and import quota were examined. To get this information, company websites as well as company information databas of the Bureau van Dijk,3 Dun and Bradstreet,4 and Creditreform 5 were retrieved and compared in order to obtain the most recent figures available. This approach of taking
more than one source into consideration was necessary as 53% of the Austrian AEO holders in the sample have less than 249 employees and 37% have an annual turnover of less than 50 million Euro. Therefore, a lot of them fall in the range of EU small to medium-sized company definition according to Commission Recommendation 2003/361/EC of 20 May 2003, and the sorts of companies are often very cautious not to relea too much information about their business. In addition, many are not autonomous companies, that is, they are local subsidiaries of much larger corporate groups headquartered in Austria or somewhere el with very specific fields of activity like procurement and import of raw material, cars and spare parts, etc., or they simply reprent the management part of a larger holding company.
Table 3: Austrian AEO holders as at end of 2013 by year of receiving their AEO status
AT
200820092010201120122013Holder of AEO-C 6(16.7)17(19.5)31(23.1)58(31.2)80(34.0)85(34.1)Holder of AEO-S 0(0.0)0(0.0)1(0.7)1(0.5)1(0.4)1(0.4)Holder of AEO-F 30(83.3)70(80.5)102(76.1)127(68.3)154(65.5)163(65.5)TOTAL
36
87
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134
维妙维肖186
235
249
Table 4 shows results per AEO-holders’ main field(s) of business activity according to ÖNACE 2008 (Statistics Austria 2010), grouped into industries/ctors of (1) commodity (mainly gas and oil), (2) manufacturing, (3) wholesale/retail (4) transport/logistics and (5) rvice industry. Furthermore, for better comparison, averages per field of business activity were drawn from Statistics Austria (2014) with the latest figures of turnover and and number of employees as of 2011.
First, it is obvious that in Austria the status of AEO-F is more appreciated than AEO-C (especially in the manufacturing as well as the transport and logistics ctor) and the importance of AEO-S is almo
st negligible. Furthermore, the wholesale/retail ctor shows a balanced u of AEO-C and AEO-F certifications on average, which may stem from the fact that this ctor is much more nationally orientated than the others.
When comparing the date an AEO certification was granted, companies from the commodity ctor, wholesalers and retailers em to be laggards. A clor look at the AEO population development shows that early birds of AEO certification in 2008 were in fact mainly manufacturing companies or transport and logistics rvice providers that applied for an AEO-F status.
Table 4: Company characteristics of Austrian AEO-holders (as at end 2013)
Commodity Manufacturing Wholesale/Retail Transport/ Logistics Service
Industry
TOTAL AEO since (on average)Q2 2011Q4 2010Q2 2011Q3 2010Q2 2010
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Q4 2010Holder of AEO-C
6312223082Holder of AEO-S 000101Holder of AEO-F 28722436160TOTAL AEO-holders 81184467*
6243*Average turnover (in Tsd. €)2,688,080(224,196)402,816(37,188)128,944(11,903)146,901(9,612)188,869(1,624)349,739(29,917)Average Employees 402(175)957(71)235(11)262(22)398(4)598(48)Turnover/Employee (in Tsd. €)
12,867(2,497)463(459)1,611(807)343(383)480(360)1,046(563)Average Import Quota
502657-5135Average Export Quota
61
81
52
-29
73
* For five customs hou brokers no reliable data was available, one manufacturer was listed twice. Furthermore, throughout all industries/ctors in Table 3, AEO-holders are larger companies than on
average, both in terms of annual turnover and average number of employees. But the datat contains some wholesale, retail and commodity ctor companies where annual turnover is abnormal high with only a few employees. This is a strong indication that the companies are either working in a very focud, specialid business or they simply reprent the management part of a holding company.Last but not least, AEO-holders in the Austrian manufacturing industry are very export-orientated with wholesale, retail and commodity ctor companies showing, on average, more balanced foreign trade.
5. Conclusions
In general, it can be said that obtaining an EU AEO certificate is beneficial for every company; at least, it does not provide any drawbacks. However, some benefit more from it than others.
First, the more export-orientated an industry ctor is, the more AEO certifications are issued. In the ca of Austria, many AEO-holders come from the manufacturing industry as their business is very often heavily export-orientated. At least some benefits that come with AEO status make their export business easier to manage.
Second, a tight link between the manufacturing and the transport and logistics ctors is obvious: tra
nsport and logistics rvice providers like freight forwarding companies usually organi and/or perform transport and logistics rvices for the manufacturing industry on national and international levels (Schramm 2012). Thus, they are quite often pushed by their clients to apply for an AEO status or el lo them as clients.
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