As "guardian of Hong Kong's frontiers", the Customs & Excise Department has a tough job. And, despite the moniker, has more on its plate than just watching the airports, ports, waterways and land boundaries.

In fact, apart from high-profile anti-smuggling and anti-narcotics duties, the C&E Department's portfolio of responsibilities covers such varied items as the protection of intellectual property rights (i.e. the war against pirated software, CDs and DVDs, etc); the protection and collection of revenue on dutiable goods (i.e. hydrocarbon oil, tobacco, alcohol, etc); the deterrence of money laundering; the protection of consumer interests (i.e. watching out for such items as skin whitening creams that can cause mercury poisoning!); the protection and facilitation of legitimate trade and industry; and liaison with other countries' customs and enforcement agencies. The Department has quite a hectic agenda!

Heading the 5,000-strong team of busy customs officials is Raymond H C Wong, JP, Commissioner of the Department.

Although people may associate the C&E Department with high-speed chases of smugglers at sea and lightening raids on shops and stalls in Sham Shui Po, this image can be misleading. Wong notes, "With our twin roles as trade facilitator and guardian of the community, we are mindful of making the best use of our resources to find a proper balance between trade facilitation and law enforcement."

E is for "efficiency"
Guns, dogs and fast boats may still be the perfect tools for the enforcement part of this equation but, in this era of computers, handheld devices, wireless broadband and e-everything, the facilitation aspect of the Department's role is changing rapidly. And it is no slouch when it comes to updating methods and equipment.

"Electronic commerce has to a considerable extent changed the work of our Department," says Wong. "The development of e-commerce is an integral part of the 'new economy' and, in order for the business sector to take part successfully in this economy, there must be appropriate corresponding support by government. As far as Customs is concerned, we are evolving into e-Customs."

The Asia Pacific Economic Conference (APEC) has mandated paperless trading by 2005 and the C&E Department is committed to reducing or eliminating all paper-related customs functions by this date. Already, the Department accepts a variety of trade-related documents online, including the vital import and export declarations, submitted through Tradelink, which currently provides the exclusive gateway for the trading community to submit a range of electronic trade-related transactions to the HK SAR Government. Also on the list of Tradelink exclusive services are Restrained Textiles Export Licences, Certificates Of Origin, Production Notifications and Cargo Manifests. In January this year, the Department rolled out the electronic Dutiable Commodities Permit application service, via Tradelink's gateway, allowing for electronic application and approval for payment of duties on these items. Later this year, the EDI-Manifest system will become operational for all cargo, except that entering by land.

Hong Kong's position as a cargo hub for the region makes it imperative that delays are kept to a minimum in the shipment and transshipment of goods. The C&E Department launched its Air Cargo Clearance System in 1998, allowing importers to submit their manifests electronically in advance of the goods' arrival. Customs then decides which shipments it wants to check, stops only those shipments and allows all others to pass through without hindrance. Clearly, this system makes sense in today's busy - and perishable - world.

Despite the Land Boundary System, which was implemented in 1992, goods arriving by land are not quite so lucky. The Department has, however, embarked on a Feasibility Study for Electronic Road Cargo Manifests with a view to automating the cargo clearance process at Hong Kong's land boundaries. Nevertheless, in spite of what occasional publicity may lead the general public to believe, the current land customs procedures are quite fast. For example, the average time it takes a laden truck to pass through boundary checks is 45 seconds, while unladen trucks get through in 20 seconds. The problem, it seems, is not the time it takes to clear each individual truck, rather the sheer volume of trucks wanting to cross the boundary.

To ease the congestion at the boundary, the C&E Department has already taken steps to reduce clearance times by some six seconds for laden goods vehicles. The Department will also commence the installation of an Automatic Vehicle Recognition System, which will save customs officials from having to input manually each crossing vehicle's registration number. The Department has pledged to cut some 13 seconds from each crossing by the end of this year, making the average crossing time for a laden vehicle around 32 seconds. Of course, the C&E Department can't control the number of trucks crossing the boundary, but a planned new crossing point will help alleviate some of the pressure.

The e-seal inter-modal scheme, jointly proposed and developed by Tradelink and the Logistics Information Network Enterprise Limited, whereby trucks have their manifests/cargo checked and cleared in advance of arrival at the boundary, then sealed with an electronic device that alerts customs officials if it is tampered with, is also being considered. Despite some apprehension at the costs involved, the system looks certain to enhance efficiency.

E is for "easy"?
The C&E Department is moving rapidly ahead with modernisation work in order to increase efficiency, reduce operating costs, promote customer service quality, update professional knowledge and techniques, and, most importantly, ensure that its services use the best and most modern technologies available.

Wong believes it is imperative that the Department keeps up with the rest of the world, which is, indeed, turning more frequently and extensively to electronic-based operations. Of course, the sticking point with these e-systems is, as ever, compatibility. "Though we notice an increased use of IT in global trading, it is unfortunate that most of the trading data reside in proprietary systems that do not talk outside their own network," he notes. "To help solve this problem, the G7 Customs Experts have established common data sets and formats with a view to drawing up a global standardised electronic declaration for the clearance of international transportation of goods. At present the World Customs Organisation [of which Hong Kong is currently Vice Chair representing the Asia region] is overseeing a trial run between the United Kingdom and Canada," he adds.

E is for "enabling"
Internally, the C&E Department has implemented a broad range of IT-based measures, as well as studies and business process re-engineering initiatives, to streamline operations and procedures, and enhance productivity. A new system helps the Textiles Task Force to identify potential illegal transshipments; the Government Office Automation programme enables the use of note mails for internal government communication; the Case Processing System supports the speedy exchange of intelligence, investigation information and case documents within the Department, and allows management to keep track of each case from start to finish; and the EDI-DCP system is being enhanced to support the Department's open bond initiative.

"As a Department with great potential for IT development, we have recently embarked on an Information System Strategy Study aimed at devising the medium- and long-term IT plans needed to underpin our services over the next five years," says Wong. The study is expected to be completed by August.

E is for "enemy"?
Any country's Customs & Excise department is often regarded as an obstacle to trade, rather than a facilitator of it, but Wong begs to differ: "I believe most traders consider our Department a working partner that, on the one hand, regulates their legitimate trading activities for the overall benefit of Hong Kong, while, on the other hand, offers the greatest convenience possible to help facilitate their trading business."

Of course, to arrive at this happy point in their relationship, it is essential that the C&E Department and Hong Kong's trading community have frequent interaction. One of the channels open to both parties is the four Customer Liaison Groups (CLG) set up by the Department in 1994 to enhance communication between the Department and, respectively, traders in sea freight, air freight and dutiable commodities, and the cross-boundary transport industry.

"To keep our fingers on the pulse, we maintain contacts with the trading community through meetings of these four CLGs," says Wong. "In addition, traders can at any time voice their concerns or opinions to our Department through meetings or any other means of communication. For example, we are currently modifying the EDI-Manifest system to address concerns raised by sea and air carriers."

The C&E Department also recently uploaded to its website an Internet-based service called "One-stop advisory centre for cargo clearance matters", setting out for traders overseas and locally the necessary steps and procedures for cargo clearance in Hong Kong.

E is for "evil"?
The greatest concern of the world's online community is security. And this applies equally to the C&E Department and its portfolio. "To prepare ourselves for the potential proliferation of computer crimes that have inevitably emerged with the growth in electronic commerce, we have formed a Computer Analysis and Response Team and trained a group of Customs officers to become qualified experts in computer forensics," says Wong. The Department has also set up a Computer Forensic Laboratory aimed at providing forensic services and technical support to front-line investigative officers in the collection, recovery, examination and analysis of digital evidence that might be found in computers or other seized electronic storage media.

Hong Kong's Customs & Excise Department definitely has its fingers not only on the pulse, but also on the keyboard.