Customs and trade solutions play a pivotal role in facilitating smooth international trade operations. These services encompass a wide range of activities, including customs clearance, duty calculations, compliance management and navigating complex trade regulations.
As global commerce continues to expand, the importance of efficient and accurate customs processes cannot be overstated – they not only ensure legal compliance, but also contribute significantly to supply chain efficiency, cost management and overall business competitiveness in the international marketplace.
The world of customs regulations is intricate and ever-changing, presenting significant challenges for businesses engaged in international trade. These regulations vary widely between countries and are subject to frequent updates based on political, economic and security factors.
In the UK, a recent example is the introduction of the government’s Border Target Operating Model, a new risk-based approach to import checks which has had a particular impact in product areas such as food and sanitary, as well as products from an animal origin. Another disruption, meanwhile, has been the shift from NCTS4 to NCTS5 – this is the online system for submitting transit declarations and notifications to HMRC.
Understanding and adhering to these complex rules requires deep expertise and constant vigilance. All too often, regulatory changes do not happen when they are scheduled or expected to, rarely do they ‘do what they say on the tin’.
Making the case for real intelligence
Many firms operating in the customs space have based their entire business models around artificial intelligence (AI) engines completing the entire declarations process.
It is easy to see why. AI has made remarkable strides in automating many aspects of customs processes, delivering accuracy, speed and value to customers.
However, while AI excels at processing vast amounts of data and identifying patterns, it struggles with nuanced interpretation, contextual understanding and adapting to rapidly changing regulatory scenarios. This is where real intelligence (RI) – human expertise and insight – becomes indispensable.
In the customs context, RI refers to the unique human capabilities of critical thinking, contextual understanding and adaptive problem-solving. It encompasses the accumulated knowledge, experience, and intuition of customs professionals.
Specifically, RI can and will continue to play a crucial role across numerous customs practices and processes which are essential to delivering a reliable, credible service. This includes interpreting complex regulations and their implications, navigating grey areas in customs law, and developing strategic approaches to compliance and risk management. Human input is also critical to providing personalised solutions for unique business challenges and fostering relationships with customs authorities and stakeholders.
How AI and RI complement each other
We believe the ideal approach to modern customs operations lies in the synergy between AI and RI. AI can handle routine tasks, process large volumes of data and flag potential issues, while RI can focus on the more nuanced aspects of our work which have just been described.
Ultimately, this combination allows for more efficient, accurate and sophisticated customs management that is more likely to deliver success each and every time.
We must, of course, acknowledge that AI has and will assume a critical role in how the world of customs operate. AI delivers us numerous benefits, especially around the completion of manual tasks, ensuring accuracy of data capture and entry, and carrying out jobs at speed. The AI is also capable of learning, meaning it gets better at completing those tasks as it goes along. For example, our AI is synced with our CRM system and familiarises itself with clients’ declarations – this gives us added confidence that what it is producing is accurate.
However, the AI is not perfect and cannot replace a trained human expert. Documentation can be messy to the point where wrong interpretations are made. Is the HS code correct? Is the stated weight correct and in line with the shipment’s appearance? We see our 1,700 human experts as the final hurdle, the resource which gives us and our customers peace of mind.
Indeed, it is this extra layer of checks and balances provided by human intelligence that could be the difference between success and failure, enabling a company to make the right duty payments and not have their shipment held up at the border.
While AI excels at processing routine transactions, it is much more challenging to handle exceptions or cases that don’t fit predefined patterns. For instance, goods that fall into grey areas of classification could have dual-use concerns (civilian and military) or be subject to sanctions. These require real time RI. Another black spot for AI is customs regulations which vary widely between countries and can change frequently. Here, AI will struggle to interpret these changes, and RI is often needed to understand the implications of new laws or regulations and how they apply to specific goods or transactions.
AI can analyse and correct submitted information, but it cannot identify what is missing entirely. It lacks the intuition and contextual understanding to spot these hidden opportunities. Real intelligence fills this crucial gap, combining knowledge of trade agreements, origin rules and customer patterns to maximise benefits. This human touch ensures that customers don't miss out on valuable duty savings due to documentation oversights.
A symbiotic future
As we look towards the future of customs operations, we anticipate a continued evolution of the AI/RI dynamic – while AI will undoubtedly become more sophisticated, the role of human expertise will remain crucial.
We expect to see increased integration of AI tools in customs processes, but with human oversight. There will likely be a greater emphasis on upskilling customs professionals to work alongside AI, as well as the development of hybrid roles that combine technical knowledge with AI literacy. Furthermore, we anticipate a shift towards more strategic and consultative roles for customs professionals.
Ultimately, the future of customs lies not in choosing between AI and RI, but in harnessing the strengths of both to create more efficient, accurate and adaptable customs solutions.
