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[Interview] Deal with Customs challenges and opportunities in Russia with GEFCO

25 September 2019

With more than 13 years of Customs brokerage experience, GEFCO Russia and their dedicated teams, composed of 53 engineers and brokers, have become one of the leading customs brokers thanks to their knowledge in local and international regulations.

Alexander KOVALENKO, Head of customs in GEFCO Russia, answers our questions.

What are the main issues and customs evolutions of the market in Russia today?

The first key point to mention is the full digitalisation of 100% of themandatory Customs operations for companies since 2014 in Russia. In addition to that, we are currently facing major changes in terms of customs regulations and customs practices:

  • Russia has just adopted New Customs Codes of the Eurasian Economical Union at the beginning of 2018.
  • A new Federal Law on Customs Regulations came into force in 2018, significantly enhancing the customs controls to improve the collection of customs payments that provide approximately 50% of the Russian Federal Budget.
  • Russian customs authorities intend to centralise customs clearance operations into centres for electronic declarations, altogether, the number of customs clearance locations will be reduced from more than 400 customs points at the beginning 2018 to only 16 centres by 2020.

 

What currently are customers’ requirements?

The main requirements of the customers now are the competitiveness of customs solutions, the legal security and the overall compliance of the operations.

 

In this context, what are the solutions and benefits provided by GEFCO?

As Customs brokers since 2006, we developed a strong expertise in offering the most compliant and cost-efficient solutions to our customers. GEFCO Russia customs team is composed of 53 people and has become one the leading customs brokers in Russia with 23,000 customs operations in 2018.

In this context, we can offer a wide range of solutions to our customers from the most strategic to the most operational; regulatory watch, customs audit, engineering and flow optimisation andcustoms clearance operations; import / export declarations, transits, ATA book preparation, declaration of exchange of goods.

 

Trade turnover between Russia and China soared by nearly 30 percent in 2018, what are the consequences in terms of customs?

Our customers are mainly EU and US based companies, we have not felt the impact of this trend.

However, many of our customers tend to favour Asian suppliers (mainly Chinese); therefore, we have observed a decrease incustoms clearance activities coming from Western countries and an increase in demand for customs clearance in Far Eastern area of Russia.

For instance, the volumes incustoms clearance operations of GEFCO in Vladivostok has increased by a factor of 10 in the last 3 years.

 

What are the development plans for GEFCO Customs activities in Russia in the coming months and years?

We intend to enhance our presence and operational scope through the following strategic developments:

  • Increasing the integration with the main Russian Customs software, Alta Soft, and develop the electronic customs document workflows with our customers
  • Using the RZD customs network to support local operations
  • Enhancing our presence in all the main frontier entry points into and out of Russia from 20 to approximately 25
  • Implementing customs clearance solutions for time critical shipments at Moscow airport

All of our planned strategic projects, in the next 3 years, will strengthen our position in Russia as the preferred choice of Customs partner, enabling our major customers to tackle customs challenges, unlock financial opportunities and help control their Customs risks and compliance issues.

All of our planned strategic projects, in the next 3 years, will strengthen our position in Russia as the preferred choice of Customs partner, enabling our major customers to tackle customs challenges, unlock financial opportunities and help control their Customs risks and compliance issues.

Alexander Kovalenko

Head of customs in GEFCO Russia

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