RESTRICTED
CEFACT/2010/IT020
23 August 2010
UNITED NATIONS
CENTRE FOR TRADE FACILITATION AND ELECTRONIC BUSINESS
(UN/CEFACT)
INTERNATIONAL TRADE PROCEDURES WORKING GROUP (ITPWG) - TBG15
First Draft Recommendation 40
Consultation mechanisms
Best Practice in Government and Business Community Preparations for
Consultations on Trade Facilitation Matters
SOURCE:
ACTION:
STATUS:
Recommendation 40 project team
Preparation for ODP Step 3 Internal review
First Draft
CEFACT/2010/IT020
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Recommendation No. 40
Consultation mechanisms
Good Practices in the Preparations for Consultation on Trade Facilitation
Matters between Government and Business Community
INTRODUCTION
Trade facilitation has moved higher and higher up on the agenda of trade policy. Various studies have
shown that there are large gains in facilitated trade and that those gains mainly are made by the
country carrying out the facilitation measures. At the same time it is clear that un-coordinated
measures for trade procedures risk creating one problem while solving another, be efficient only for
parts of the trading community or simply not have any impact at all since they do not affect traders’
real situation.
As consequence just setting up, for instance, a PRO-organisation, as described in the UNECE
Recommendation no 4, National Trade Facilitation Bodies, is not enough. There is a call for
information on best practice on how to organise consultation between trade organisations, on how
governments should co-ordinate their agencies and on how trust and collaborations is established
between the two parties. The focus is on the work done before the parties enter a PRO-organisation or
an implementation committee. The models should put an emphasis on how to build trust and on how
to coordinate and prioritise opinions.
An integral and important part of how trade facilitation has come to develop in many economies is the
active participation of civil society, especially traders’ organisations and PRO-bodies, in the
development of rules and regulations. Traders, economic operators, chambers of commerce and other
associations organising the stakeholders directly involved in trade have first-hand knowledge of how
the current legislation affects them and what simplifications they would like to see. In that context, it
is worth noting that different private sector operators may not always have the same interests.
Importers and exporters, users and providers, larger and smaller companies, producers and traders,
may all have different needs and priorities when it comes to trade facilitation reforms.
Governments have a need for structured information on how trade develops and how rules affect it, in
order to build the economy, but governments also needs to co-ordinate their actions and understand
how one government agency’s actions will affect another. Non trade related regulation can have a
trade impact and this needs to be established at an early stage, communicated and consulted upon.
Responsibility at this initial stage rests with government to identify the potential impacts, to advise
other government departments who might be impacted and to consult with trade.
The processes of developing trustworthy information flows between trade and government and to
develop co-ordinated policies in government, that are less cumbersome to trade, are less easy to bring
about than it can seem. Much emphasis has been put on the process of putting up fora for
communication between government and trade organisations. However, this is a process that is more
complex than that. Government needs to have a model of working through proposed legislation that
both co-ordinates the different agencies, departments and their respective agendas and cultures and
take into account the opinions of other stakeholders, such as trade itself. Traders, and the economic
operators involved in trade as well as the organisations involved in or affected by trade need to have
mechanisms in place to co-ordinate and prioritise their opinions and policies. The challenges for
partnerships between trade and government are manifold: sustainability, trust, the differences in work
practice between business processes and legislative, normative processes, institutional self-perception
and ideology.
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A vital challenge is the building of trust. Trust is a key word in working trade consultation models.
Government must be able to trust that traders’ organisations have a worked through agenda and an
intimate knowledge of the measures discussed. A common complaint from government officials is that
trade expresses the viewpoint of the few, in a anecdotic way, with no real consideration to other
interests in society. Trade can express that they are only informed, not consulted, and that their
opinion is of little value in front of all demands from other sectors. For the private sector and for
SMEs especially this can be a daunting task since there is a lack of resources and time. To build
working consultation models between companies and their organisations demands resources and
capacity building is mostly directed to governments. There might be a scope for training in order to
promote awareness of the benefits to all business – small or large.
A further key challenge is the sustainability of the private sector’s participation in such collaborative
mechanisms as they provide a public good. This may discourage active participation, because those
who contribute pay (with their time and effort) while the benefits go to all stakeholders. There is thus a
need for motivation of the private sector, especially smaller stakeholders, to participate.
A third challenges is the question of the lead agency. When it comes to the negotiations, the lead
agency of such collaborative mechanisms is often the Ministry of Commerce or the Ministry of
Foreign Affairs. For most specific trade facilitation reforms, however, the lead agency has shown to be
Customs, who are working on trade facilitation in the context of the World Customs Organization. The
Task Forces will thus not only need to link the public and the private sector, but also the different
public sector agencies.
PURPOSE
The United Nations Centre for Trade Facilitation and Electronic Business in its Recommendation 4
National Trade Facilitation Bodies recommends governments and states to form trade facilitation
bodies and gives guidelines on how these bodies can be constituted and how they can work. However,
these trade facilitation bodies do not exist in a vacuum, they are the consequence of a political will to
gather the best available information on a given problem, to hear the view of all concerned parties, to
exchange views and ideas and to prepare all concerned parties for new legislation. This political will
does not only reside with governments and governmental agencies, it must also be shared by the
various organizations representing the business community and the traders.
In order to have meaningful consultations, all concerned parties need to go through thorough
preparations with their stakeholders or members in order to determine:
 what their priorities are,
 how these priorities can change in the view of new proposals or developments,
 how information is shared between the parties,
 what information can be shared and at what time,
 what information must be shared and at what time in order to give other parties the necessary
time to react,
 what the limits of the consultation are.
Preparations before consultations are necessary to foster a collaborative culture and achieve concrete
results. The preparations may be different in nature depending on whether the party concerned is, for
instance, a government agency, a traders’ association or a chamber of commerce, but there are patterns
and models that will be recurrent in these preparations. The purpose of this recommendation is to
advice governments and the business community on how to achieve results through effective
consultations. This recommendation presents models for information sharing and preparations before
consultations take place, and give examples of best practice in the field of consultation.
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SCOPE
This recommendation primarily envisages consultations on a national level. However, many of the
basic principles and ideas can be transferred both to local, sub-regional and regional levels. Generally
a larger number of parties and distance between them increase the need for thorough preparations.
BENEFITS
The aim of consultation on trade facilitation matters is manifold. In order to find suitable solutions to
complex problems legislators and government agencies will find that the expertise and experience of
the companies and organisations that work on the field is a valuable source of information. Together
the parties will be able to find innovative, effective, cost-efficient and simplifying solutions to any
issue discussed. In contrast even simple changes of rules or regulations may encounter problems on
the ground not thought of by the legislator, problems that can lead to for instance longer waiting times,
corruption and loss of revenue.
Furthermore, consultation and building trust between the parties will increase transparency, promote
quick adoption of new rules, give industry time to prepare for new rules or regulations and generally
promote successful legislation.
Consultation will give both sides the possibility to explain their viewpoints, clarify arguments and
relations between measures, and build acceptance for legislative measures.
RECOMMENDATION
The United Nations Centre for Trade Facilitation and Electronic Business at its XXth Plenary session
in XX in Geneva agreed to:
1. Propose a generic model for consultations on trade facilitation matters, for the consideration
of governments and organizations representing the private sector involved in trade, stressing
the importance of transparency for building trust and creating a constructive collaborative
environment.
2. Recommend to Governments and organizations representing the private sector to prepare for
consultation on trade facilitation matters in accordance with the proposed generic model.
Preparations should be done with mutual respect and with the aim of promoting mutually
beneficial results.
3. Recommend to Governments and organizations representing the private sector to adopt
transparent mechanisms for preparations for consultations on trade facilitation matters.
4. Recommend to Governments and organizations representing the private sector to discuss and
coordinate policy with their members and stakeholders continuously. This will help
governments and organizations to prioritize agendas and communicate results.
5. Highlight the importance of transparency and positive results as a prerequisite for building
trust between the parties in consultation.
6. Recommend to Governments to share information on trade facilitation matters and legislative
measures at the earliest convenient time in order to allow the private sector to prepare for
consultations.
7. Recommend to Governments to establish mechanisms to allow easy access to information on
trade facilitation matters and legislative measures.
8. Recommend to organizations representing the private sector to inform Governments of
suggestions and issues they wish to consult on in good time prior to consultations taking
place.
9. Recommend to organizations representing the private sector to if possible consolidate their
views in advance of consultations and if differences persist be transparent about these
differences and the reasons for them.
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GUIDELINES TO RECOMMENDATION NO. 40
Definitions (Kevin)
 Text giving definitions of the terms consultation, model, government, trade, and so on...
Basic principles for consultation (Sören? – Lawyer Bill L?)
 Partnership and trust
 Managing differences of opinion and interests
o How to co-ordinate the opinion of many – models for civil society
o How to handle minority interests?
 Respect for time and timing
Types of consultation (Andrea)
 The use of reference groups and written and oral consultations should be treated in the
guidelines.
 A classic consultation model is described below. It is a challenge to find other models for
other settings. 3rd parties should also include the public.
Levels and parties (Johan)
 Many levels of consultation: Strategic, tactic, operational
 Intra-governmental organisation
 Co-ordination between government and its agencies, for instance Coordinated Border
Management
 Many trade organisations – several “sincere” opinions
 How to handle minority interests?
 How do we represent the SME:s? There needs to be innovative and imaginative ideas to
involve the SME-sector.
 Are the Chambers of Commerce included?
 3rd sector (Labour unions, media, rural committees, NGO:s), lawyers.
 Municipalities. How is society organised, who owns the land (Vietnam)
 Results oriented
 Military to be included?

Preparations for consultations (Johan)
to in order to promote transparency, flexibility, efficiency and
Mutual understanding of business and government environment
 There are different constraints in all different sorts of environments. How do we
overcome that?
 Sharing of information can be difficult for all parties. How can this be at its best?
 Example of Benin: The Chamber of Commerce and Ministry of Trade have succeeded in
overcoming the lack of trust that was there before. Results driven cooperation. Respect
 Results Building trust!
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Generic Model (Johan and Niki)
 Model of consultation between government and the trading community
 Explanations and limitations
Topics for consultation
 Vast range of possible topics
 The right topic at the right level
 Overall policies needs to be thought through to the detail

The limits of consultation
 There needs to be an awareness of the fact that consultation can seize to be consultation
and become notifications.
 Feedback is very important and it needs to follow the classic model:
 a=b x c2 Acceptable = balanced, constructive and credible
Public-Private-Partnership – models for financing and beyond
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ANNEX A
Annex to Recommendation No.40
Case Studies
Joint secretariat for a consultation body – can we find an example or case study on that?
Example of Benin: The Chamber of Commerce and Ministry of Trade have succeeded in overcoming
the lack of trust that was there before. Results driven cooperation. Respect  Results Building
trust!
Sri Lanka – Shanta might want to contribute on this. Experience on trade consultation in Sri Lanka.
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