IATA Confident e-AWB will be 100% by 2015
As a major first step towards delivering the complete e-freight suite, IATA’s airline members are committed to introducing the e-AWB (electronic Air Waybill). IATA’s targets are to deliver 20 per cent e-AWB penetration by the end of 2013, 50 per cent by e
Des feels e-commerce and specifically, e-freight is the future of the air cargo industry. Paperless cargo is a goal, which every segment of the industry – shippers, forwarders and airlines – is committed to, through the work of the Global Air Cargo Advisory Group (GACAG).
He pointed out that at the recent World Economic Forum (WEF) in Davos, Switzerland, the WEF published a study on ‘Removing Trade Barriers’ featuring e-freight as a case example, among others that illustrate the benefits governments and companies could get from removing key barriers such as the lack of electronic customs procedures and over-reliance on paper documents.
According to Des, e-freight, once fully adopted, will cut thousands of tonnes of paper, speed up transit times by up to 24-hours and improve the industry’s environmental credentials. There are significant securities and cost benefits as well. “With cargo yields at risk of falling for the second year running in 2013, the benefits in pushing forward the efficiencies of e-freight should be clear,” he said.
IATA has agreed on an e-freight Roadmap with GACAG that has called for 80 per cent of global airfreight trade lanes to be e-freight enabled by the end of 2015. They are working with industry partners to develop e-freight in key air cargo locations, including the BRIC (Brazil, Russia, India and China) countries.
IATA is also working in collaboration with the World Customs Organisation (WCO) to push government administrations to adopt the WCO’s “Dematerialisation”
recommendations. These call upon national administrations to remove the requirement for paper Customs Declarations and paper supporting documents, in compliance with the Revised Kyoto Convention standards and the WCO SAFE Framework of Standards recommendations. Some 166 WCO Member States have committed to adopt SAFE, and India is one of them.
“As a major first step towards delivering the complete e-freight suite, IATA’s airline members are committed to introducing the e-AWB (electronic Air Waybill). IATA has agreed with FIATA that adoption of e-AWB is an important industry priority, and our targets are to deliver 20 per cent e-AWB penetration by the end of 2013, 50 per cent by end 2014, and 100 per cent by 2015. GACAG also fully endorses this timetable,” informed Des.
Areas of Concern Currently, the global penetration of the e-AWB is at around seven per cent. “So, we have clearly worked to reach our year-end target. There are a number of issues behind the relatively slow pickup of the e-AWB. Some national governments have failed to ratify the ICAO protocol MC99, which enables the use of e-AWB as the contract of carriage. In those countries, IATA together with the national airlines is lobbying the government to ratify MC99,” Des observed.
In addition, some airlines and their trading partners have been unable to invest in systems enhancements needed to optimise e-freight capabilities due to the financial crisis that has been gripping the world. Some government departments have also had budget constraints, which have affected their adoption of paperless e-Commerce and e-Customs practices that support e-freight.
Airlines Initiatives Against the above scenario, IATA witnessed a number of success stories with the e-AWB, notably Cathay Pacific in Hong Kong and Emirates in the UAE, who have implemented 100 per cent e-AWB from their hubs in Hong Kong and Dubai. Similar trends are being followed by Singapore Airlines in Singapore, and by Korean Air at Seoul. Many key trade lanes are using the e-AWB and the penetration is growing.
“I am confident that the targets will be met and I have been delighted with the response from airlines, particularly, the
The creation of GACAG means that we have a platform to discuss and move projects forward together”
Global Head of Cargo, IATA
airlines on the Cargo Committee. They have realised that they have to lead from the front in adopting a paperless approach. Of course, many airlines have gone through a very tough few years, financially, and have not had sufficient resources to invest in e-freight capability. Hopefully, as the benefits become evident, and as volumes pick up, that will change,” Des feels.
He also maintained that the response from the rest of the cargo chain has also been positive. “The creation of GACAG means that we have a platform to discuss and move projects forward together. This also means that we have refocused the e-freight project, with responsibility for the removal of core paper transportation documents falling to airlines, while the removal of other paper documents is led by the shipper and freight forwarder communities,” Des emphasised.
Indian Context According to Des, the air cargo industry in India is largely ready to implement e-freight, and in fact, some airlines have already put in place most of the e-freight practices and processes, but we are still missing full paperless customs processes.
He pointed out that although India has signed the ICAO protocol MC99 and India Customs has an e-Commerce platform called ICEGATE, which allows electronic filing of Import & Export documents, India Customs still requires the submission of paper Customs Declarations and paper Support Documents, such as commercial invoices, in addition to the electronic filing through ICEGATE.
“That is the only obstacle to the industry implementing e-freight completely in India, and we are hopeful that this can be removed with the collaboration of India Customs,” he maintained.
“However, while we are working to remove this obstacle, there is nothing stopping the airfreight industry in India moving forward with e-AWB immediately, since the usage of e-AWB is already accepted by the Central Customs Administration in India,” he added.
Meanwhile, an industry support group, coordinated by IATA and led by Delhi International Airport (DIAL) with participation from airlines, and freight forwarders as customs brokers, has been engaging with India Customs to implement a paperless e-Customs capability. India Customs have agreed, in principle, to undertake paperless e-Customs trials on low value shipments at New Delhi Airport as a proof of concept.
“The New Delhi Proof of Concept is intended to lead to the roll out of a fully paperless capability across all Indian airports and for all shipments irrespective of their value,” Des believes.
Once the Proof of Concept trials are concluded, the industry support group will again meet with representatives of the Central Board of Excise and Customs to discuss a roll out plan. This approach has the full approval and backing from the WCO under its “Dematerialisation” initiative.
“In the short-term, we are working with airport customs authorities on the ground to accept shipments using an e-AWB, in accordance with the regulations defined by the central customs administration. We need the influence and leadership of the national airlines for making India a market fully open for the e-AWB,” Des concluded.