UPS SIGNS MOU WITH SALVADORAN CUSTOMS TO EXPEDITE

UNCLAS SAN SALVADOR 000402 SIPDIS SIPDIS DEPT FOR EB/TPP/BTA, WHA/CEN USDOC FOR 4332 ITA/MAC/MSIEGELMAN E.O. 12958: N/A TAGS: ECON ETRD KTEX ES SUBJECT: UPS SIGNS MOU WITH SALVADORAN CUSTOMS TO EXPEDITE CUSTOMS CLEARANCES ¶1. SUMMARY: UPS and the GOES have signed a memorandum of understanding that establishes simplified procedures that could be extended to all international express delivery companies in El Salvador. The MOU enables the application of best practices, according to UPS, to facilitate the clearing of merchandise and ensure adequate control by customs officials. These practices will improve the country's business competitiveness and may help it move toward its goal of becoming a regional logistic center. END SUMMARY. ¶2. On February 8, Salvadoran Vice President Ana Vilma de Escobar and Customs General Director Gustavo Villatoro signed a memorandum of understanding (MOU) with representatives of the U.S. express delivery company United UPS to facilitate trade and efficient customs controls. The MOU provides for simplified procedures that expedite clearance of merchandise through any port of entry within a maximum of 48 hours after arrival. Elements of the MOU include: 1) reduced documentation for low value goods; 2) waiver of further inspection for merchandise valued under $3,000; and 3) payment of customs fees which have a only a representative value. UPS will also have 8 working days following importation to pay fees and charges. Under the MOU, UPS is required to electronically transmit cargo manifests and present shipping documents when goods arrive. While not in the MOU, the collaboration includes support for the implementation of an electronic risk assessment and pre- clearance system at Salvadoran Customs to select goods for inspection prior to arrival, allowing others to pass without inspection. ¶3. The GOES decision to pursue the MOU stemmed from an earlier visit by the Vice President to UPS operations in Taiwan and, according to UPS, put El Salvador ahead of other Latin American countries in adopting international best practices (comment: although other countries in the region have recently been successful in reducing time through customs at their own ports of entry). December 2005 amendments to the 1999 Customs Simplification Law - passed by the Legislative Assembly at the same time the Assembly approved a package of CAFTA-related legal reforms - allowed the government to move forward with the MOU. Executives were highly complimentary of the swift action by the GOES. The simplified procedure will be available to any other courier that wishes to sign a similar MOU with Salvadoran Customs, and it is expected that other express delivery companies will follow. The implementation of expedited and simplified processes for express delivery companies will raise El Salvador's business competitiveness, and is the kind of action that will move the country toward its goal of becoming a logistics center for the region. Barclay