On February 5, 2020, the 76 nations under the TIR Convention of the United Nations have unanimously agreed to digitalize its operations (eTIR) under the global customs transit system. This momentous decision will facilitate trade and the seamless movement of goods across borders.
Olga Algayerova, executive secretary, United Nations Economic Commission for Europe (UNECE) said, “The adoption of eTIR, which is the result of over 20 years of negotiations, marks a new chapter in the TIR Convention’s 70-year evolution. With more and more countries joining the convention in recent years, including major economies like China, India, and several countries in the Middle East, this important step will help to harness trade and connectivity as drivers of sustainable development.”
What is TIR?
A multilateral customs treaty among world nations, the TIR (Transports Internationaux Routiers or International Road Transport) Convention came into effect on March 20, 1978. The treaty signed by 76 countries aims to simplify and harmonize the governmental procedures of international road transport. The TIR Convention’s framework allows 1 to 3.5 million truck trips to cross borders as quickly and efficiently as possible, every year.
Today, the TIR system is used by more than 34,000 transport and logistics companies across 76 participating countries and led to an up to 80% reduction in transportation time and 38% cut in transporting costs. The digitization of the TIR procedures will further improve efficiency.
eTIR Test runs in Iran, Turkey, Georgia, Azerbaijan, Kazakhstan, and Ukraine
Since 2017, several of the TIR contracting countries have been implementing a series of eTIR pilot projects. Besides the currently functioning ones between Iran and Turkey, and Georgia and Turkey, there are others in the pipeline like the eTIR intermodal project between Azerbaijan, Georgia, Kazakhstan, and Ukraine and the eTIR project between Azerbaijan and Iran.
eTIR in intermodal transport
Paperwork for intermodal transport has proved to be thoroughly cumbersome under the current TIR system. The eTIR is expected to open new applications for the TIR system, especially in the area of intermodal transportation. This new amendment will also secure the TIR system for all customs administrations using it.
Reduced trade transaction cost
The TIR system ensures the payment of customs duties and taxes by providing a guarantee mechanism. This has led to a reduction in trade transaction costs, thereby furthering intra and inter-regional trade.
Requiring only minimal manpower and facilities from customs and national authorities, the system significantly reduces transit delays and congestion at border crossings.