Back to the complete issue
Wednesday, 9 June 2021

The ACI explainer – what you need to know and how you can prepare

Enterprise Explains: The ACI — What you need to know and how you can prepare: Starting from 1 July, businesses importing goods at seaports will need to file shipping documents and cargo data digitally via the Advance Cargo Information (ACI) system. Otherwise, the shipment will not be allowed to enter Egypt. Some 4.5k importers and clearing agents have already signed up to Nafeza, and this number is increasing daily, technology advisor to the Egyptian Company for E-commerce Technology (MTS) Khaled Nassif says. We take a deep-dive into what the system is, how much it will cost, and what concerns stakeholders have voiced.

What is ACI? The Advance Cargo Information (ACI) pre-registration system is a World Customs Organization (WCO) protocol that provides real-time information on shipments of incoming goods to shipping lines, port operators and governments. To comply with the new system, the importer needs to register on the Finance Ministry’s digital customs system Nafeza (aka National Single Window for Foreign Trade Facilitation), and obtain an e-signature token at least 48 hours before the goods are shipped. The importer is required to file the paperwork in order to be given a unique ID known as an ACID. This then needs to be submitted along with other documentation such as invoices and foreign exporter and shipment data to Nafeza at least 24 hours before the ship leaves port. The process is set up by the Egyptian Company for E-commerce Technology (MTS).

What information do you need to register a shipment? The required shipment data includes approved value, customs and submission systems, the cargo delivery site, customs item numbers and data, and statistical customs quantity. If there is an initial lading bill, the bill number, ports of loading and arrival, shipping company, freight number, means of transportation, gross and net weight and number of parcels are requested. As for the invoices, the importer needs to provide the purchase order number, invoice date and value, type of contract, billing currency, and foreign exporter nationality. Additional information includes item description, gross and net weight, item price, unit weight and the statistical customs quantity.

Who will be affected? Primary stakeholders are importers and suppliers, clearing agents and companies, and air or sea shipping companies. The system has already been implemented at 90% of Egypt’s sea ports, but will be expanded to land and airports in the future, with no set timeline yet, Deputy Finance Minister for Treasury Affairs Ihab Abou Eish said recently. The system is currently deployed in Alexandria, Ain Sokhna, Port Said, Port Tawfik, Dekheila and Safaga. Adabiya port is also included, Abou Eish stated, adding that Nuweiba and Aswan had not been included yet due to the low volume of goods coming through the ports.

Why is Egypt implementing the ACI system? The collected data sets are used to identify high-risk or dangerous cargo prior to loading. The aim is to strengthen supply chain security and mitigate potential security threats, as well to give countries time to scrutinize consignments prior to their arrival and take appropriate steps. This should also shorten the clearing time for incoming goods, head of airfreight at logistics company DB Schenker Dina Soliman tells us. The process also protects suppliers and clearing agents from foul play, she says.

How do we know this is secure? The system runs on blockchain technology, provided by CargoX, the sole blockchain document transfer gateway service provider for the ACI process. Since it is running on blockchain, the system ensures that digital data is not forged or counterfeited, by allowing only certain people to have “editing access” to certain data points. The data in its final form has a timestamp and is linked to any previous versions or forms it had taken. This is then shared with peers’ computers. The fact that it is not just shared with one central server, but that several different processors will have a copy of the data in its different forms makes it secure, as it is less likely to be forged.

What if I do not have my ACID when the ship arrives at an Egyptian port? The goods will not be cleared and will be returned to their port of origin.

How much will it cost stakeholders? The total fees are still unclear. Some fees need to be paid once by the importer upon initial registration on the system, such as e-signature fees. Other costs will primarily depend on the number and type of goods in the shipment. Additional costs from CargoX are expected to include the ACI declaration envelopes and bills of lading. Previously, customs and shipping documents were sent and legalized via couriers running between embassies, chambers of commerce and authorities. Now all of this has shifted online. CargoX charges USD 15 registration fees, then an additional USD 50 per shipment and between USD 2-3 per document transferred, Soliman tells us. Primarily, the supplier will have to pay the registration fees on Nafeza, Nassif says.

How are companies being onboarded? The Egyptian Company for E-commerce and Technology has conducted webinars for companies to help them with the registration process, while the Finance Ministry has sent some companies official letters prompting them to register, Nassif tells us.

What are stakeholders worried about? The ACI implementation on July 1 is causing some concern among stakeholders, such as who will bear which costs, how familiar the customs authorities are with the system, what the final pricing will look like and which stakeholder needs to register on the platform in some cases. Moreover, the knowledge transfer between MTS and the customs authorities is still not complete, DB Schenker’s Soliman explains.

Your top infrastructure stories for the week:

  • Nour City construction begins: The construction of Talaat Moustafa Group’s EGP 500 bn Nour City development has begun.
  • RIZ Mk II: Russia wants to set up a second industrial zone in the Suez Canal Economic Zone, this time in Ain Sokhna.
  • A new seaport on the North Coast: President Abdel Fatah El Sisi has ordered the establishment of a new seaport in the El Max area between the Alexandria and El Dekheila ports.
  • Work begins on mega petchem facility: The foundation stone for a USD 7.5 bn petchem complex in the Ain Sokhna industrial zone was laid on Saturday.
  • New desalination plant: Orascom Construction (OC) and water treatment company Metito have delivered a USD 130 mn seawater desalination plant in East Port Said.
  • Saint Catherine development project: Hassan Allam Construction has begun work on a project to revitalize Saint Catherine city in South Sinai.

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2022 Enterprise Ventures LLC.

Enterprise is available without charge thanks to the generous support of HSBC Egypt (tax ID: 204-901-715), the leading corporate and retail lender in Egypt; EFG Hermes (tax ID: 200-178-385), the leading financial services corporation in frontier emerging markets; SODIC (tax ID: 212-168-002), a leading Egyptian real estate developer; SomaBay (tax ID: 204-903-300), our Red Sea holiday partner; Infinity (tax ID: 474-939-359), the ultimate way to power cities, industries, and homes directly from nature right here in Egypt; CIRA (tax ID: 200-069-608), the leading providers of K-12 and higher level education in Egypt; Orascom Construction (tax ID: 229-988-806), the leading construction and engineering company building infrastructure in Egypt and abroad; Moharram & Partners (tax ID: 616-112-459), the leading public policy and government affairs partner; Palm Hills Developments (tax ID: 432-737-014), a leading developer of commercial and residential properties; Mashreq (tax ID: 204-898-862), the MENA region’s leading homegrown personal and digital bank; Industrial Development Group (IDG) (tax ID:266-965-253), the leading builder of industrial parks in Egypt; Hassan Allam Properties (tax ID:  553-096-567), one of Egypt’s most prominent and leading builders; and Saleh, Barsoum & Abdel Aziz (tax ID: 220-002-827), the leading audit, tax and accounting firm in Egypt.