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5 must haves of a risk management system for Customs purpose

Customs around the world have the challenging tasks to enhance trade facilitation by reducing unnecessary controls while protecting borders and states revenues by targeting high-risk consignments, all in compliance with international standards.

Fortunately, they can count on innovative tools to assist in their daily endeavours to make trade safer and smarter. One of the most efficient way to guarantee the right balance between controls and trade facilitation is to use a robust risk management system to improve goods flow management.

To assist Customs in identifying the best tool, we have highlighted in this article the 5 must haves features for the finest results.

1. Combined risk assessment method

The first and most important feature of an expert risk management system for Customs Administrations is the usage of a combined risk assessment approach. Customs should always favour a system combining both the classical rules-based approach and random targeting with a more modern approach based on artificial intelligence to achieve the best outcomes.

Why is it important?

While most risk management systems rely exclusively on the classical approach to target high-risk consignments, we know that this method has its limitations. For instance, it is effortlessly decodable by clearing agents or traders, which represents a security threat for Customs.

By choosing a comprehensive solution, Customs can take full advantage of an artificial intelligence-based technology to automatically assess the risk of fraud and set corrective actions while entrusting Customs expertise to access collective intelligence.

This makes customs controls effective whilst enhancing levels of trade facilitation. For more insight about the best method, read our article about the four analytical approaches to customs risk management.

2. Continuous integration of data

The great advantage of a risk engine powered by machine learning is that it gets smarter over time. By automatically feeding the engine with controls results, the system continues to learn to steadily achieve better results.

Why is it important?

Data is the key to an efficient risk assessment; if data are scarce or if the data quality is low, you may have a hard time obtaining great outcomes. By feeding back the controls results, you provide the system with more information to learn from and continuously update the scoring.

Control feedback loops allow the system to learn about fraudulent behaviours, improve accuracy, and optimize resource allocation. Nevertheless, to make continuous integration possible, the next feature is also essential.

3. Integration within the Customs ecosystem

We won’t emphasize it enough having access to good quality data is capital. For that reason, your risk management system must be integrated with the customs management system in place to receive all relevant information required to operate efficiently.

Two additional conditions are needed for successful integration; first, data transfer must be secured to guarantee confidentiality and avoid any security breach. Second, interactions between systems must be seamless to prevent any disruption of customs operations.

Why it is important?

All Customs activities should be connected from start to finish to prevent fragmented conversions, resulting in deficiency and ineffective management of goods clearance process or even security issues. By smoothly integrating your risk management system with all the systems in place, you maximize the interactions to create a holistic environment suitable for smarter and safer risk assessment.

4. A dedicated graphical user interface

Customs must be able to quickly respond to incoming threats. This implies being able to quickly and easily update risk assessment configurations to reflect the evolution of fraudulent practices. Unfortunately, the solutions in place often do not offer a comprehensive and intuitive risk management user interface to enable effective and rapid end-to-end risk management configuration.

Why it is important?

A dedicated risk management user interfaces flexible and intuitive enough to allow customs business users to easily create and update risk experiments is crucial to maximizing the benefits of risk management.

A modern user interface helps increase adoption and ultimately enables Customs to take full ownership of the software.

5.Sensitive risk profile management  

Customs are the barrier against the traffic of illegal or dangerous products; for this reason, it is fundamental to maintain a highly efficient management of high-risk cargoes. Therefore, your risk management system must enable the configuration alerts or notifications mechanisms for highly sensitive profiles.

Why it is important?

Appropriate authorities are timely notified when sensitive risk profiles are triggered in order to initiate the necessary actions to coordinate the required control, analyze results and follow up on the clearance process.

Overall, Alerts mechanisms allow for a more proactive way of managing incoming threats. 

For more than 20 years, Cotecna has been working closely with Customs to perfect its Automated Risk Management System – CRMS®, our mission is to provide the most advanced solution to help Customs to always stay one step ahead of illicit trade patterns.

For more information about our CRMS® and our Customs solutions or to request a demo please contact us at governments@cotecna.com

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