Standards for cross-border paperless trade

What are standards for cross-border paperless trade?

Running a business can often involve filling in lots of forms, and printing lots of documents. The volume of paperwork can increase significantly when international trade is added to your business operations.

According to some studies, the average cross-border transaction requires exchanging 36 different documents and 240 paper copies. To reduce paper waste and enhance business efficiency in international trade, various organizations have been mapping out standards that can support small businesses to go paperless.

Standards for cross-border paperless trade are the result of collaboration between public and private-sector institutions facilitating best practices when using digital tools for commercial transactions, logistics, payments and other operations involved in trade. (See Trade4MSMEs guide on Standards.)

Types of standards for cross-border paperless trade

The Standards Toolkit for Cross-border Paperless Trade developed jointly by the World Trade Organization (WTO) and the International Chamber of Commerce (ICC) provides a detailed explanation of the most important and frequently used standards in digitalizing trade procedures facilitating a move to frictionless cross-border paperless trade.

Standards for cross-border paperless trade can be general to international trade, or specific to the participants in supply chains.

The Standards Toolkit provides a list of the most commonly and widely adopted paperless trade standards and identifies six types of standards that are more practical for small businesses.
These are summarized below:

• Foundational standards: Support businesses to meet requirements on data sharing, reporting, usability, due diligence and compliance. Making it easier to transmit data from one system to another. Some examples include country, language and currency codes, units of measure, and standards on financial messaging and freight containers.

• Identifier standards: These refer to the names or IDs for any element involved in a supply chain and the relevant data exchanges, such as products, persons, entities, packages, carriers, containers and other physical or digital items such as trade documents. The Harmonised Commodity Description and Coding System (HS code) is an example related to products.

• Commercial Transaction Document standards related to the ‘buy’ ‘ship’’ pay’ Process: These relate to organisations of all sizes from Corporations to micro-small- and medium-sized enterprises MSMEs in international supply chains. They are manufacturers, exporters, suppliers, distributors, importers, and buyers of products. Standards are set for digitizing documents for commercial transaction, transport and logistics, and payments. A prime example of this are standards for a commercial invoice, purchase orders, packing lists etc.

• Standards for transport, forwarding and cargo handling documents: Relate to shipping-related documents, such as standards on bills of lading, air waybill, and documents for rail and road transport.

• Standards for Customs authorities and other cross-border regulatory agencies: Customs authorities and other cross-border regulatory agencies (CBRAs) have a regulatory view of the supply chain and require submission of data primarily for the purpose of regulatory reporting and compliance at points of export, import and transit. Sanitary and Phytosanitary (SPS) Certification is a prime example.

• Standards for Interoperable digitalisation frameworks: Allows organizations, business partners and intermediaries to interact with supply chain participants so they can embrace digitalisation frameworks that support the exchange of electronic trade documents. Distributed Ledger Payment Commitment (DLPC) is an example of this

How can standards for cross-border paperless trade support your business to engage in international trade?

Adopting standards for cross-border paperless trade can save your business from significant costs associated with managing operational procedures in paper format. For example, statistics indicate that managing paper files can take up to 40% of workers time in addition to the high expenses that companies have to spend on printed forms and documents.

Paperless trade standards can also help your business to access data and exchange information between supply chain actors that may be relevant for your current and/or future international business activities.

As these standards aim to digitalize your key information flows and present them in widely recognized formats, your business can reduce costs and improve efficiency while gaining trust with business partners and customers in new markets. By moving from paper to digital, you can amplify your business opportunities to engage in international trade.

Links to Supporting Information

Trade4MSME Guides Standards

The World Trade Organization (WTO) and the International Chamber of Commerce (ICC) WTO | Standards Toolkit for Cross-border Paperless Trade: Accelerating Trade Digitalisation Through the Use of Standards

The International Chamber of Commerce (ICC) Digital Standards Initiative For Executives | The ICC Digital Standards Initiative

The European Digital SME Alliance Standards Guides for Information and communications technology (ICT) ICT Standards for SMEs – European DIGITAL SME Alliance

The European Digital SME Alliance Sustainable Digitalisation – the path to European Digital Sovereignty (digitalsme.eu)