Potential exists for Ireland to be a major player in e-business

The opportunity exists for Ireland to become a major clearing house for electronic trade between the US and the European Union as a result of new customs and trading regulations being introduced in both jurisdictions.

Next week over 250 private and public sector executives will meet in Dublin under the auspices of the UN's Centre for Trade Facilitation and Electronic Business (Cefact) and hosted by Irish software and services company CP3 Group.

"Ireland is a natural centre to host such an event as this," said Conor O'Riordan, chief executive CP3. "As a hub between the trading blocs of the US and Europe and as a country with a major commitment to the developing world, there is an opportunity for Ireland to become a world broker in trade and trade clearance issues."

Electronic trading, which removes paper forms from the supply chain, has generally run over private EDI networks with limited standardisation. With the move to e-business over secure internet-based networks both private business and government agencies have seen the potential for new cross-industry standards which will be more efficient.

According to O'Riordan, in tandem with the technological changes the role of customs and excise organisations, including the Irish Revenue Commissioners, has moved from purely tax collection to being responsible for border security.

Post September 11th, 2001, the US tightened up its customs regulations so that it could efficiently validate goods passing across its borders. This resulted in the Customs-Trade Partnership Against Terrorism (C-TPAT) a simplified programme for importers who provide information about their supply chain and implement recommended security practices.

At the same time the European Commission has made changes to the Customs Code which introduces the concept of Authorised Economic Operators from the beginning of next year. Organisations who supply the necessary information about their supply chain will gain AEO status and thus be able to avail of certain simplifications of customs regulations. The Revenue Commissioners states on its website that "while the legitimate movement of goods by non-AEO's should not be slowed, this cannot be guaranteed".

Tighter government regulation of an industry or activity is always good news for technology providers - the regulations themselves will not specify a particular technological approach but the only way to satisfy their requirements is invariably through the application of software.

According to O'Riordan while large importers and exporters won't have any problem putting in place the electronic systems necessary to meet the EU and US regulations, smaller companies and those in developing countries could be at a distinct disadvantage. "For developing economies, if they can't communicate on this basis, their goods are going to be on the slow boat," he says.

While CP3 offers a hosted service for companies to implement paperless trading, O'Riordan believes there is a huge opportunity for Ireland to become an electronic clearing house for trade between Europe and the US by leveraging its technical know-how and its position in the EU. The foundation to make it possible is that the Irish Customs Service has recently completed a major overhaul of its computer systems which allows for automated entry processes.

O'Riordan claims that if CP3 and its network of partners can successfully implement the new guidelines electronically they can reduce the cost of transatlantic trade by 2-15 per cent. "The key resources needed to refine the product are already in the country," says O'Riordan, referring to international supply chain experts such as IBM.

At next week's UN Cefact forum in Dublin four major announcements are expected to be made around standards that will facilitate international electronic trading. While some might question the impact of a UN forum introducing new standards, O'Riordan believes the broad industry support for Cefact marks it out as different.