ELECTRONIC T2L AS A SOLUTION TO IMPROVE
SHORT-SEA SHIPPING AND MOTORWAYS OF THE SEA
IN EUROPE
Amparo Mestre, Eva Pérez, Lorena Sáez,
Miguel Llop, José García
Fundación Valenciaport
FUNDACIÓN
DEEuropean
LA COMUNIDAD
PARA LA
PROMOCIÓN Y ESTUDIOS COMERCIALES DE VALENCIAPORT
Visita del Sr. Luis
Valente
de Oliveira,
Coordinator
for Motorways
ofINVESTIGACIÓN,
the Sea
Valencia, 15 Febrero 2010
E-FREIGHT
CONFERENCE,
DELFT
10th VALENCIANA
MAY
2012
CONTENTS
1.
MOS4MOS Project
2.
Rationality
3.
Problem identification
4.
Diagnosis
5.
Analysis of a possible solution
6.
Participants
7.
Cost-Benefit Analysis of implementing the electronic T2L
8.
Conclusions
Electronic T2L as a solution to improve SSS and MoS in Europe - Page 2
1. Introduction
Action: Monitoring And Operation Services For Motorways Of The Sea (MOS4MOS)
Project Code: 2010‐EU‐21102‐S
Duration: 21/March/2011 – 31/May/2012
Co‐financed by: European Union, Trans-European Transport Network, Motorways of the Sea Call
2010
MOS4MOS: Pilot action aimed at preparing the different stakeholders systems to provide integrated
and interoperable services for door-to-door Motorways of the Sea (MoS) supply chains
General goal: Design and demonstrate a set of prototypes that will provide interoperable
monitoring and operation services to companies integrating different MoS corridors
The project will contribute to establishing a European/Mediterranean maritime space without
barriers by facilitating and simplifying compliance with regulations
Consortium:
Electronic T2L as a solution to improve SSS and MoS in Europe - Page 3
1. Introduction
Initiatives
Intra-Community
Customs
Paperless
Controls
Automated Gate
System
Rail-Port
Interfaces
Electronic IntraCommunity Freight
Formalities
(ELECTRONIC T2L)
Corridor
Strategic
Planning and
Management
Port Community
Collaborative
Solutions
Rail e-Ways
Multimodal
Paperless
Workflows
Rail Transport
Management
System
Short Sea
Consolidation eServices
Electronic Ship
Formalities
Port Traceability
Vessel
Georeferenced
Alerts
RFID Traceability
of Ro-ro Units
RFID Traceability
for Automotive
Logistics
Measures for reducing
administrative
Electronic T2L as a solution to improve SSS and MoS
in Europe -burdens
Page 4
2. Rationality
 Complex and time-consuming administrative procedures based on paper documents and
manual processing are a waste of resources and a source of errors that have a negative effect
on safety, security and performance.
 Customs play a key role in the development of innovative solutions to facilitate and simplify
all the required formalities in import, export and transit operations while preserving and
enhancing the required security, protection and control measures for guaranteeing these
operations.
 Significant progress has been achieved in recent years in e-Customs systems and Maritime
Transport Information systems in the EU Member States. For example, the introduction of the
“authorised regular shipping service”, since 1998, has substantially simplified sea transport
under specific circumstances.
Electronic T2L as a solution to improve SSS and MoS in Europe - Page 5
2. Rationality
 The European Single Market is based on a Customs Union among Member States offering free
movement of goods, services, people and capital.
 The European Customs has removed Customs duties within the EU and created a common external
tariff. Goods are initially able to move freely throughout the EU.
current situation
 EU ports represent the line between the EU Customs territory and non-EU Customs territory.
Customs controls required to determine the status of goods.
 Community goods are those:
- Obtained in the Customs territory of the European
Community;
- That having been imported from countries or territories not
forming part of the Customs territory of the Community have
already been released for free circulation;
- Obtained or produced in the Community from goods
referred to in the previous statements.
- Community goods placed under the internal Community
transit procedure maintain their Community status.
Electronic T2L as a solution to improve SSS and MoS in Europe - Page 6
2. Rationality
current situation
 The
status of goods transported can be proved by the documents enumerated in
the Guide to Customs Procedures for Short Sea Shipping SEC (2002) 632. The procedures covered by the
cases under consideration are:
 A T2L/T2LF (copy nº4 of the Single Administrative Document)

A properly completed invoice or transport document, relating only to the Community goods,
indicating code T2L/T2LF, as appropriate;

A shipping company´s manifest, completed and endorsed by the competent office indicating
“C” for Community goods.

The shipping company´s manifest, where the simplified transit procedures (level 2) are used,
indicating the code “C” for Community goods. The use of a shipping company manifest to
prove the Community status of goods, at the request of the Shipping Company, must be
completed and signed by the relevant Customs office.
Electronic T2L as a solution to improve SSS and MoS in Europe - Page 7
2. Rationality
current situation

Simplified procedures to prove the Community Status of goods
 Authorised Consignor: person / company authorised by Customs to use T2L and commercial
documents as status documents without having to present them for the endorsement of the
relevant office. This authorisation allows the company not to present the original forms to prove
the Community status of goods.
 Electronic Shipping Manifest: authorised consignors may be authorised not to provide the
manifest serving to demonstrate the Community status of goods until, at the latest, the day after
the departure of the vessel and before its arrival at the port of destination. The manifest must be
approved by Customs prior to use. Finally a written copy of the manifest must be presented to the
Customs of the port of destination.

Electronic procedures to prove the Community Status of goods
Belgium
Estonia
Electronic T2L as a solution to improve SSS and MoS in Europe - Page 8
2. Rationality
current situation
 Although simplified procedures exist, in most cases the mechanism for the
transport operators to prove the Community status of goods to Customs at the
ports of departure and arrival are still manual and paper-based.
Port of Exit
The general procedure to prove the Community status of goods often
requires that paper T2L documents justifying it are generated and presented
by an agent to Customs in the Member State of departure, accompanied by a
commercial invoice, and these documents are authorised with a stamp and
signature.
Then, these documents have to be sent from the port of origin to the port of
destination. There are several ways used in order to send the documents to
their destination. Usually the original documents travel on board the vessel
transporting the cargo the documents refer to; or they are posted by mail or
express mail.
Once the documents arrive, they have to be presented to Customs in the
Member State of destination where an additional stamp and a signature is
required before the goods can be picked up and leave the port. The original
T2L is retained in the Customs Office at the final EU port.
Port of Entry
Electronic T2L as a solution to improve SSS and MoS in Europe - Page 9
problem identification
3. Problem identification
 Manual and paper based mechanisms involve costly use of
administrative resources, physical displacements, paperwork, additional
costs and delays in intra-Community sea transport due to processing time,
errors derived from the non-standarized processing, problems due to
availability of original documents and difficulties to introduce methods
for automating customs controls at ports through the use of electronic
means.
Today, non-Community goods or goods in transit can leave the port
without the need to present any paper as these procedures are
completely electronic and automated.
Electronic T2L as a solution to improve SSS and MoS in Europe - Page 10
4. Diagnosis
Information exchanges Intra-Community freight flows
• Scenario 1: Transport of Intra-Community goods by a non-authorised regular service directly linking two EU ports
Intracommunity
Deliveries
Port 1
Port Type
EU
EU
Loading
Discharge
Community
Community
-
-
-
DSDT and T2L
(JCE, SNR)
T2L
-
-
-
Movement
Goods status at
port
Port 2
Entry Doc.
Port of origin: T2L
(Security amm.)
Port of destination: T2L + a summary declaration
Discharge Doc.
Loading Doc.
Exit Doc.
(Security amm.)
• Scenario 2: Transport of Intra-Community goods between two European ports with intermediate calls at non-EU ports
The Community goods are transported on the same
ship during the entire journey
Intracommunity
Deliveries
Port Type
Movement
Goods status at
port
Entry Doc.
Port 1
Pto 2
Pto 3
EU
Non-EU
EU
Loading
In Vessel
Discharge
Community
Community
-
ENS
-
DSDT and T2L
(JCE, SNR)
T2L
-
-
-
(Security amm.)
Discharge Doc.
Loading Doc.
Exit Doc.
(Security amm.)
The Community goods are transhipped in one of the
intermediate port calls
Intracommunity
Deliveries
Port Type
Movement
Port 1
Port 2
Port 3
EU
Non-EU
EU
Loading
Transhipment
Discharge
Community
Community
-
ENS
-
DSDT and T2L
(JCE, SNR)
Loading Doc.
T2L
-
Exit Doc.
EXS
-
Entry Doc.
(Security amm.)
Discharge Doc.
Port of origin: T2L +
an Exit
Summary Declaration (EXS) will
need to be presented in cases
where goods will be transhipped to
another vessel at the port in the
third country.
Port of destination: T2L + an Entry
Summary Declaration (ENS)
(Security amm.)Electronic T2L as a solution to improve SSS and MoS in Europe - Page 11
4. Diagnosis
Stakeholders
 CUSTOMS AUTHORITIES
 MARITIME CARRIERS / SHIPPING AGENCIES
 NVOCCs / NEUTRAL FREIGHT CONSOLIDATORS
 CUSTOMS BROKERS
Customs formalities relationships
 CONSIGNORS AND CONSIGNEES
T2L
EXPEDITORS
NEUTRAL
CONSOLIDATORS
/ NVOCC
MARITIME
CARRIERS
CUSTOMS OF
EXIT
NEUTRAL
CONSOLIDATORS
/ NVOCC
MARITIME
CARRIERS
CUSTOMS OF
ENTRY
Electronic T2L as a solution to improve SSS and MoS in Europe - Page 12
5. Analysis of a possible solution
 The electronic T2L is oriented to facilitate and simplify the compliance with Customs regulations by proving the
Community status of the goods transported by sea through electronic means, contributing also to the start-up of
other innovative integrated transport solutions.
 The benefits obtained will have a direct effect in the performance of the overall logistics chain in the Motorways of
the Sea.
 Pursue a win-win approach between public and private stakeholders.
 To build a European wide Intra-Community freight formalities solution, the proposal will be built upon existing
European Customs systems.
NTCS System (using for non-community goods)
Electronic T2L as a solution to improve SSS and MoS in Europe - Page 13
Source: New Customs Transit System for Europe. European Communities. 2001
5. Analysis of a possible solution
Main features of the electronic platform
 An electronic channel will be available to submit electronic T2L before the departure of the goods via maritime
transport. The technical solution will be similar to the one that was adopted for the submission of Entry Summary
Declarations (ENS) and Exit Summary Declarations (EXS).
A web page associated to the Taxation Agency web site will be available in order to receive the information of the
T2L. The information requirements are still subject to changes.
A computer assisted risk assessment will be done immediately after the declaration, which will result in the
assignment of a green, orange or red circuit. The Web Service that is used will send as a response an electronic
message that will assign a number to the T2L by a MRN and will inform about the assigned circuit. If a green circuit is
obtained, this will imply the Customs clearance and a control number will be associated. The information about the
Customs clearance of the T2L that are submitted electronically will be transmitted to the port authorities so that they
can apply the export paperless controls.
An electronic channel will be available in order to present the accounting of the Community goods associated to the
T2L when they arrive to the border Customs area.
Another computer assisted risk assessment will be done immediately after the declaration. The Web Service will send
as a response an electronic message that will assign a reference to an exit document (JCE or proof of Community
goods). Analogously to the export process, if a green circuit is obtained, a control number will be associated and all the
information transmitted to the port authorities so that they can apply the import paperless release procedures.
A web system to perform consultations will be available.
Electronic T2L as a solution to improve SSS and MoS in Europe - Page 14
6. Participants
CUSTOMS
PORT
ECONOMIC OPERATORS
(Simulation)
 Valenciaport Foundation is the leading partner promoting this initiative.
 University of Piraeus is providing technical assistance and expertise in the initiative.
 IFS, Global Maritime Agency and Arkas have provided the required inputs concerning intra-Community freight
formalities.
 Port Authorities of Valencia, Barcelona, Salerno, Livorno and Luka Koper have gathered and analyzed in detail
the current situation and identified problems from different economic operators that handle intra-community
goods by sea, contact local and national customs authorities when required and built their respective prototypes
to demonstrate a feasible solution in each place adapted to the local environment and context.
Electronic T2L as a solution to improve SSS and MoS in Europe - Page 15
7. Cost-Benefit Analysis of implementing the electronic T2L
Methodology:
European Commission (2008): Guide to Cost-Benefit Analysis of Investment Projects. Evaluation Unit of the European
Commission. Directorate of Regional Policy. Brussels, July, 2008.
Main changes that the implementation of the e-T2L would bring to the current operational processes of each
stakeholder have been analysed  interviews and fieldwork.
Investments and potential increases and decreases in costs have been measured.
An application has been programmed that is capable of dynamically calculating the main cost-benefit results that
would stem from the implementation of the e-T2L initiative. Such results include: economic Net Present Value (NPV),
economic Internal Rate of Return (IRR), an investment recovery time (pay-back period).
A stochastic model of the cost-benefit analysis has been constructed: an average has been established for each
parameter (the value that displays the highest frequency) along with a confidence interval using the minimum and
maximum expected values for this factor.
By stochastically modelling each of the parameters, it is possible to calculate how sensitive the final economic NPV,
IRR and pay-back year are to each and every factor included in the estimation and the variability interval with an
associated probability distribution for each result.
 1,000,000 different scenarios have been simulated in this study.
Analysis of the results of the cost-benefit analysis and the sensitive analysis.
Electronic T2L as a solution to improve SSS and MoS in Europe - Page 16
7. Cost-Benefit Analysis of implementing the electronic T2L
Hypotheses:
Life-span of the project: 20 years
Ports under study: Valencia, Barcelona and Salerno
Average inflation rate: 2%
Discount rate for public sector entities: 5%; discount rate for private companies: 10%
Annual growth of intra-Community traffic: 2%
Annual maintenance cost (software): private bodies: 10%; public bodies: 5%
Procedures of proving Community status of goods: paper T2L 60%; “C Manifest” 15%; 25% authorised
consignors
Container intra- Community traffic (2010): Valenciaport: 70,377; Barcelona: 55,159 and Salerno: 70,000
Percentage of consolidation: Valencia and Barcelona: 10%; Salerno: 3%.
8 T2L per consolidated container and 1 T2L per 2 full container.
Shipping agencies: Valenciaport: 57; Barcelona: 40 and Salerno: 12.
NVOCC: Valenciaport: 5; Barcelona: 7 and Salerno: 1.
Electronic T2L as a solution to improve SSS and MoS in Europe - Page 17
7. Cost-Benefit Analysis of implementing the electronic T2L
Hypotheses:
Percentage of implementation of the initiative: 95%
Percentage of errors in current processes: 1%.
Time solving errors: 30 minutes
Average procedure time (current processes):
NVOCC: 9 minutes per T2L
Shipping Agencies: 9 minutes per T2L; 3.6 minutes when using C Manifest and 0 minutes when acting
as an authorised consignor
Customs: 4.8 minutes per T2L
Average procedure time with electronic system: 0 minutes.
Labour cost: 14.46 Euros/hour
Cost of printing paper T2L: 0.01 Euros
Average cost of transport of the T2L to Customs (to be signed and stamped): 0.16 Euros
Electronic T2L as a solution to improve SSS and MoS in Europe - Page 18
7. Cost-Benefit Analysis of implementing the electronic T2L
Electronic T2L as a solution to improve SSS and MoS in Europe - Page 19
7. Cost-Benefit Analysis of implementing the electronic T2L
SHIPPING
AGENCY
NVOCC
IRR (%)
-
64,11%
CUSTOMS
0,57%
PORT
AUTHORITY
TOTAL
-
17,63%
Electronic T2L as a solution to improve SSS and MoS in Europe - Page 20
7. Cost-Benefit Analysis of implementing the electronic T2L
Electronic T2L as a solution to improve SSS and MoS in Europe - Page 21
8. Conclusions
 The electronic T2L has been included as one of the 22 proposals in the Spanish Action Plan for the Reduction
of Administrative Burden.
 This Action Plan was approved by the Agreement of the Spanish Council of Ministers signed on 16 September
2011 (Consejo de Ministros, 2011).
 Spanish Customs has carried out their own estimate of the savings that would be generated by the
implementation of the electronic T2L using the Simplified Method to Measure Administrative Burden and the
Impact of its Reduction.
 If all Spanish ports and port communities used the new electronic T2L system enforced by Spanish Customs,
savings would amount to 39 million Euros.
Electronic T2L as a solution to improve SSS and MoS in Europe - Page 22
8. Conclusions
The electronic T2L would be extremely useful for Customs Authorities as they are responsible for
developing innovative procedures and solutions to facilitate and simplify all the required formalities in
intra-Community flows while preserving the required security.
Validate additional measures for extending some of the advantages of EU authorised regular
shipping services, allowing the creation of virtual bridges carrying goods between ports within the EU.
 Facilitate and simplify Customs controls at ports while enhancing security.
 Reduce existing bottlenecks and delays inherent to manual processes
 Introduce new methods for simplifying formalities for ships arriving and/or departing to/from
European ports without reducing the level of security and safety.
 Foster the adoption and recognition of electronic documentation and the use of electronic data
transmission systems.
 Eliminate the risks, latency and quality issues common to manual verification of documents at
customs controls.
Make intra-Community sea transport as simple and easy as intra-Community road transport is.
Electronic T2L as a solution to improve SSS and MoS in Europe - Page 23
Thank you for your attention!
Amparo Mestre
Fundación Valenciaport
amestre@fundacion.valenciaport.com
FUNDACIÓN
DEEuropean
LA COMUNIDAD
PARA LA
PROMOCIÓN Y ESTUDIOS COMERCIALES DE VALENCIAPORT
Visita del Sr. Luis
Valente
de Oliveira,
Coordinator
for Motorways
ofINVESTIGACIÓN,
the Sea
Valencia, 15 Febrero 2010
E-FREIGHT
CONFERENCE,
DELFT
10th VALENCIANA
MAY
2012