FBR Introduces Blue Channel Facility for Facilitating Trade

The Federal Board of Revenue (FBR) has automated a number of processes to strengthen the Risk Management System (RMS) for facilitating trade.

According to FBR’s Annual Performance Report FY 2021-22, to augment the non-intrusive inspections, the Blue Channel Facility was introduced in RMS whereby selection of consignments for scanning is made through RMS-based selectivity criteria to achieve the objectives of security and facilitation of trade in light of the WCO SAFE Framework of Standards.

The module is successfully operational at Karachi Port and Port Qasim. A total of 981 GDs have been processed through the blue channel during FY 2021-22.

Moreover, a newer iteration of the predictive analysis algorithm, namely the Import Risk Evaluation Engine (IREE), based on an updated machine learning cycle was implemented in FY 2021-22, which has significantly improved the ability of the RMS to selectively target risky consignments leading to an increase in the green channel clearances by 9 percent compared to the previous year.

On account of this intervention, the physical examination of imported goods decreased by 8 percent for imports and by 11 percent for exports during FY 2021-22 as compared to last year.

With a view to further reducing the human interference in the processing of exporter’s duty drawback claims selectivity criteria were developed in the RMS, for auto processing and sanctioning of such claims with direct payments to exporters’ bank accounts through the State Bank of Pakistan (SBP).

During FY 2021-22, 72 percent of rebate claims were processed through the green channel and currently, the rebate payment through the green channel has reached 83.5 percent.

With a view to complying with standard 3.25 of the Revised Kyoto Convention, a pre-arrival/preclearance system was introduced in FY 2020-21. This has also allowed for conformity vis-e-vis Article 7 of the Trade Facilitation Agreement (TFA). During FY 2021-22, a total of 14,172 consignments have been cleared before the arrival of goods at ports.

A system-based assessment of goods declarations has been introduced through the Virtual Assessment module which is based on strict selectively criteria to achieve the objectives of the faceless assessment and quick clearance of consignments. A total of 1,109 GDs have been processed through Virtual Assessments during FY 2021-22.

The report also highlighted that to further reduce the risk of the illegal import and exports of banned items, the module of RMS on manifest has been implemented, wherein the RMS shall run on manifest as well as on Goods Declaration by the trader.

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