Revolutionizing Imports Trade: How Kenya’s iCMS Cuts Customs Clearance Times by 60%!
How the Integrated Customs Management System Works
Customs agencies worldwide face the dual challenge of facilitating trade while ensuring regulatory compliance. To address these challenges, the Kenya Revenue Authority (KRA) has implemented the Integrated Customs Management System (iCMS), a streamlined and efficient platform designed to integrate various customs processes into a cohesive system. This article will explore the features, benefits, and overall impact of iCMS on Kenya’s trade landscape.
Overview of iCMS
The Integrated Customs Management System (iCMS) is a comprehensive platform developed to manage all customs procedures electronically. It was introduced to replace the older Simba system, which had become outdated and inefficient. The primary goal of iCMS is to enhance efficiency, reduce clearance times, and improve compliance with customs regulations.
Key Features of iCMS
1. Auto-Upload of Import Data
One of the most significant features of iCMS is its ability to automatically upload import data. This reduces the need for manual data entry, minimizing paperwork and human error. Traders can upload data directly from their systems to iCMS, ensuring that all information is accurate and up-to-date.
2. Integration with iTax
iCMS is integrated with Kenya’s tax system, iTax. This integration allows for seamless sharing of information between the two systems, which helps combat non-compliance. By linking customs data with tax data, iCMS ensures that all traders comply with both customs and tax regulations, reducing the risk of tax evasion.
3. Electronic Auction Platform
The electronic auction platform within iCMS streamlines the auction process for customs cargo. This platform makes the auction process more transparent and efficient, allowing goods that need to be auctioned due to non-compliance or abandonment to be handled quickly and fairly.
4. Improved Cargo Tracking
iCMS offers robust tracking capabilities, allowing for real-time monitoring of cargo movements. This feature significantly reduces the risk of cargo diversion and loss. Traders and customs officials can track shipments from their point of origin to their final destination, ensuring that goods arrive on time and without unnecessary detours.
5. Automated Processes
Many manual tasks have been automated within iCMS. For example, traders can now make self-declarations, speeding up the process and reducing errors. Automation also enhances transparency, as every step is recorded and can be audited if necessary.
Benefits of iCMS
1. Enhanced Efficiency
iCMS significantly reduces import and export clearance times. Before its implementation, clearing goods could take several days. With iCMS, this time has been cut by up to 60%, which is crucial for businesses that rely on timely shipments. Faster clearance times mean that goods can reach the market quicker, improving the overall efficiency of trade.
2. Streamlined Information Exchange
The system integrates with the Automated System for Customs Data (Asycuda), which is used by East African Community (EAC) member states. This integration facilitates smoother information exchange and coordination among these countries, particularly for goods transiting through the Mombasa port. As a result, trade within the region becomes more seamless and efficient.
3. Reduced Risk of Diversion and Loss
The improved tracking capabilities of iCMS reduce the risk of cargo diversion and loss. Real-time monitoring ensures that shipments are always accounted for and reach their intended destinations without unnecessary detours or delays. This not only protects traders’ interests but also enhances the integrity of the customs process.
4. Increased Transparency
Automation and electronic data management enhance the transparency of customs processes. Every action taken within the system is recorded and can be audited. This transparency reduces opportunities for corruption and fraud, fostering a more trustworthy trading environment.
5. Cost Savings
By reducing the time and resources required for customs clearance, iCMS helps businesses save money. Faster clearance times mean lower storage costs and less time spent on administrative tasks. These cost savings can be passed on to consumers, making goods more affordable.
How iCMS Works
1. Submission of Documents
Traders start by submitting their documents electronically through the iCMS portal. These documents include invoices, bills of lading, and certificates of origin. The system automatically verifies the information, reducing the need for manual checks.
2. Risk Assessment
Once the documents are submitted, iCMS performs a risk assessment. The system uses algorithms to identify potential risks based on various criteria, such as the nature of the goods, the country of origin, and the trader’s compliance history. High-risk shipments may be flagged for further inspection, while low-risk shipments are cleared quickly.
3. Duty Calculation
iCMS automatically calculates the duties and taxes payable on the goods. This calculation is based on the information provided in the documents and the applicable customs regulations. Traders can view the duty calculations and make payments electronically through the system.
4. Inspection and Clearance
If a shipment is flagged for inspection, customs officers will conduct a physical examination of the goods. The results of the inspection are recorded in iCMS, and the trader is notified of any discrepancies. Once the inspection is complete and any issues are resolved, the shipment is cleared for release.
5. Post-Clearance Audit
To ensure ongoing compliance, iCMS includes a post-clearance audit feature. Customs officials can review past shipments and conduct audits to verify that traders have complied with all regulations. This helps identify any patterns of non-compliance and allows for corrective action to be taken.
Impact on Kenya’s Trade Landscape
1. Promoting Voluntary Compliance
iCMS has significantly improved compliance rates among traders. By making the customs process more transparent and efficient, the system encourages voluntary compliance. Traders are more likely to follow the rules when they see that the process is fair and straightforward.
2. Enhancing Trade Competitiveness
The efficiency gains brought about by iCMS have made Kenya a more attractive destination for international trade. Faster clearance times, reduced costs, and improved transparency enhance the overall competitiveness of Kenya’s trade environment. This, in turn, attracts more investment and promotes economic growth.
3. Supporting Regional Integration
The integration of iCMS with systems used by other East African Community (EAC) member states supports regional integration. By facilitating smoother information exchange and coordination, iCMS helps create a more unified and efficient trading bloc. This regional integration is essential for boosting intra-African trade and driving economic development across the continent.
4. Reducing Corruption and Fraud
The transparency and automation provided by iCMS help reduce opportunities for corruption and fraud. With all actions recorded and auditable, there is less room for corrupt practices. This fosters a more trustworthy trading environment and enhances the reputation of Kenya’s customs operations.
5. Improving Revenue Collection
By ensuring that all duties and taxes are accurately calculated and collected, iCMS helps improve revenue collection for the government. This additional revenue can be used to fund public services and infrastructure projects, contributing to the overall development of the country.
Challenges and Future Developments
1. Implementation Challenges
While iCMS has brought many benefits, its implementation was not without challenges. Some traders initially struggled to adapt to the new system, and there were issues with data migration from the old Simba system. Ongoing training and support are essential to help traders fully utilize the system’s capabilities.
2. Continuous Improvement
The KRA is committed to continuously improving iCMS. Future developments may include further integration with international customs systems, enhanced data analytics capabilities, and additional features to support emerging trade trends. By staying ahead of technological advancements, the KRA aims to maintain the efficiency and effectiveness of iCMS.
3. Expanding Regional Integration
As regional integration efforts continue, there may be opportunities to expand iCMS to other East African Community (EAC) member states. A unified customs management system across the region would further streamline trade and enhance economic cooperation.
4. Leveraging Big Data
The vast amount of data generated by iCMS presents opportunities for leveraging big data analytics. By analyzing this data, customs officials can identify trends, detect anomalies, and make data-driven decisions. This could lead to more effective risk management and improved compliance.
Conclusion
The Integrated Customs Management System (iCMS) represents a significant advancement in modernizing customs operations in Kenya. By enhancing efficiency, promoting transparency, and improving compliance, iCMS has made the customs process more streamlined and reliable. Its impact extends beyond Kenya, supporting regional integration and boosting trade competitiveness.
As the KRA continues to refine and expand iCMS, the future looks bright for Kenya’s trade landscape. With ongoing improvements and a commitment to leveraging technology, iCMS is well-positioned to support the country’s economic growth and development for years to come.
