Jamaica 1 Port Community Systems JAMAICA JAMAICA PCS PHOTO BY: © PORT AUTHORITY OF JAMAICA Jamaica 2 Port Community Systems Introduction and its integration with ASYCUDA along with the National Single Window (NSW). This directly addressed at least two of the six core bottlenecks at the port, namely: (i) The customs process. In brief (ii) Timely shipments. Both were well documented by industry players as posing challenges in import and export activities, espe- The Jamaica PCS solution is a modern technology platform cially to potential investors and companies looking to Jamaica started in 2016. One of its key features includes the strategic for opportunities. decision made by the Port Authority of Jamaica (PAJ) to move towards the cloud. The Jamaican government provided strong support, through timely cabinet approvals to enable a fast-track Project preparation and development development. The Port Authority soon became responsible for all aspects of the implementation – including providing the required The PCS project in Jamaica was government mandated and PAJ funding for implementation. was identified as the Lead Agency with the Jamaica Customs Agency (JCA) designated as a partner. Both were tasked with As is the case with other case studies and examples, the project setting up a PCS in 2012. While PAJ took the role of lead imple- was originally intended and conceived as a public private part- menting entity, the Shipping Association of Jamaica (SAJ) played nership (PPP). The view on this, however, changed and the proj- a role in the early initiative. It later became a government-led ect was eventually implemented as a public initiative, financed project. wholly by the PAJ. This was important to enable high uptake, which may have otherwise been hampered by relatively high fees As the lead entity, PAJ was responsible for addressing the key for users. Another key driver for this was sensitivities around strategic and operational issues covering governance, risk, information sharing, particularly Customs related information. finance and legal. These tasks, however, were not a completely new enterprise for stakeholders operating in and around the port. The SAJ had earlier pursued exploratory and fact-finding trips Why the case study is significant to various countries. With help from the Jamaica Promotions Corporation (JAMPRO), SAJ was able to engage an international Firstly, this case study highlights several good practices in port community consultant to assist in identifying and develop- Jamaica. It shows the extent to which placing a PCS project ing a suitable PCS solution for Jamaica’s port community. The at the center of a wider policy drive and framework facilitates process included research into PCS solutions, site visits to ports engagement and ultimately uptake by different stakeholders. In in the UK, Kenya, Spain, India, Senegal, and France. Jamaica’s case, the initial drivers of the PCS acquisition were the Shipping Association of Jamaica – a private body, which Following these studies, SAJ collaborated with PAJ. Both planned ultimately worked with public entities to realize the project. Clarity for the implementation of the PCS. Plans were made for the inclu- on who the implementing agencies were, and including Customs sion and the establishment of a working committee comprising as a partner, helped to drive the project forward. It also facili- public and private sector interests. The collaboration with PAJ tated integration. Other cases often reveal unfinished integration went as far as making and agreeing budgetary provisions by both because of lack of alignment between entities. the PAJ and SAJ to fund the start of the project. Secondly, the implementation was carried out in a modular The PCS in Jamaica was seen as part of a wider initiative by format, with the systematic rollout of different services. This the government focused on improving the logistics and trading includes trans-shipment activities, import and export processes, environment. A recent strategic project related to improving the truck appointments, Air cargo41 and FAL Forms. This enabled a trade environment is the National Single Window (NSW). This careful assessment of the need of each, as well as of the costs went live in 2020. This was very much a strategic initiative by and benefits of implementing the solution to cover the scope the government to increase Jamaica’s trade facilitation and of these services. competitive business environment, both of which are critical for realizing the goals of the Global Logistics Hub Initiative.42 Thirdly, Jamaica is home to one of the region’s largest Its implementation also became part of the country’s develop- trans-shipment terminals in Latin America and the Caribbean ment strategy and was monitored as part of the medium-term (LAC). A key element was the development of Jamaica’s PCS socio-economic policy framework 2015-201843 by the Planning 41 The final modules being implemented are air cargo/import and export along with FAL Forms. The project is slated for full implementation in late 2023, at an overall estimated cost of around US$12m. 42 https://www.jseza.com/jamaica-logistics-hub-initiative/ 43 Planning Institute of Jamaica (PIOJ), Medium Term Socio-Economic Policy Frameworks Jamaica 3 Port Community Systems Table 4. Summary Roadmap to Implementation 27-Feb-2012 Cabinet approval obtained by PAJ. 13-Dec-2013 Cabinet approved the following: The Stage 1 assessment and recommendation to proceed to Stage 2 of the tender process to select the preferred bidder. The Port Community System Public-Private Partnership Transaction (Project) Structure. The Port Authority of Jamaica to be the Regulatory Body/Concession Authority and Grantor of the Port Community System’s operations. The approval also included provisions for legislative changes to support mandatory use of the Port Community System by regulations to be vested within The Port Authority Act. Allow for the sharing of trade information with a trusted private partner (Concessionaire) and other government agencies directly dealing with trade transactions via The Customs Act and amendments to the statutes governing the relevant regula- tory agencies. Allow for the successful implementation of a paperless environment for the Port Community System within Jamaica. 27-Apr-2015 Cabinet approved a change of strategy from the Public-Private-Partnership (PPP) arrangement to a new competitive bidding model which included: The use of the Limited Tender Procurement Methodology for the procurement of goods and services to establish a PCS and the subsequent creation of a PCSO for the acquisition and operations of a PCS for Jamaica. 28-Jul-2015 Cabinet approved: The award of a fixed five-year contract to the joint venture consortium of SOGET S.A. Bureau Veritas B.I.V.A.C. BV, with the main ICT provider being Microsoft Corporation, for the design, development, implementation, and maintenance of a Port Community System. Cabinet also approved the creation of a Port Community System Operator responsible for the daily operations of the Port Community System within Jamaica and the implementation of a Port Community System Tariff Fee, which will be applied to the Port Community and implemented by way of regulation under the Port Authority Act. Institute of Jamaica (PIOJ), which is charged with development The PAJ also amended the Port Authority (Port Management & and implementation of Vision 202044 4 (now expanded to 2030). Security) and the Port Authority (Port Management and Security As explained below, the government also facilitated several (Amendment) Regulation 2015. The change enabled the imple- legislative changes to both the PAJ Act and Jamaica Custom mentation and use of the PCS in Jamaica, and to also include Regulations, making the submission of all manifests via the the collection of a “user fee.” PCS mandatory. The PCS today has some mandatory and some optional func- In terms of a roadmap, the table below comprises a list of activ- tions. The submission of manifests through the PCS is manda- ities approved by Cabinet for the implementation of the PCS tory. Optional services, on the other hand, include business by PAJ. intelligence data, that may soon be made available as a value- added service (fee). Legal framework and governance From a governance perspective, as already noted, PAJ was the lead agency for the PCS development. To do this, a Steering To enable the PCS to legally operate, both JCA and PAJ had to Committee was set up. Monthly meetings were organized that review their existing laws and regulations that govern some of focused on providing strategic and tactical initiatives. The recom- their operations with respect to data sharing and use of paperless mendations that emerged were then approved by the PAJ board transactions. At the heart of the amendments was the Electronic and the Cabinet. The committee included: Transactions Act, 2nd April 2007, which made provisions for the legal transactions via electronic platforms. This provided the I. PAJ chair/implementing agency. framework that would assist the necessary legislative changes. II. JCA co-chair. Jamaica in November 2014 also passed specific laws which allowed the JCA to collect information through a paperless III. SAJ, lead private sector stakeholder, and major port labor medium, assisting the PCS solution to achieve transactions in provider/trade union. Initially conceptualizer/ driver of the a paperless, digital environment.  development of the PCS, from 1990s (see above). 44 4https://www.vision2030.gov.jm. The country’s first long-term strategic development plan and covers the 21-year period, 2009-2030, up from the original 2020.  It embodies the plans and processes for the realization of a collective vision, encapsulated in the statement: “Jamaica, the place of choice to live, work, raise families and do business.”In 2015, Jamaica adopted United Nations 2030 Agenda for Sustainable Development and its Sustainable Development Goals. Jamaica 4 Port Community Systems © PORT AUTHORITY OF JAMAICA IV. Development Bank of Jamaica (DBJ), lead agency/secre- XII. Kingston Wharves Ltd (KWL), private sector, multi-user, tariat for all PPP projects/transactions. They later withdrew multi-purpose cargo terminal operator, Kingston. from the committee when it was no longer a PPP project. XIII. Kingston Freeport Terminal Ltd (KFTL), subsidiary of CMA V. Ministry of Finance and the Public Services, parent ministry CGM, the concessionaire and container/trans-shipment for JCA and for all financial decisions / approval for public terminal operator, Kingston. entities. XIV. Port Cargo Handlers (PCH), multi-user, multi-purpose cargo VI. Ministry of Transport & Works, the parent ministry at the terminal operator, Montego Bay. time for PAJ. XV. Advantum, IT provider/major port platform and subsidiary VII. eGov Jamaica Ltd, national single window operator, public of SAJ, private sector. sector. VIII. Customs Brokers & Freight Forwarders Association, repre- Financing and business model senting freight forwarding, umbrella entity, private sector. A revenue “neutral” model was considered and applied based IX. Jamaica Society for Customs Brokers, representing on the need to receive buy-in by the port community, particularly Custom brokers, private sector. considering the changes needed to implement the project. PAJ decided to de-risk the project by providing all CAPEX and OPEX X. Port Trailer Haulage Association of Jamaica, representing from the end of 2015 and the start of 2022, therefore not billing port haulage contactors and services, private sector. the private sector during that period. XI. Terminal Operators. The creation of the business case, economic rationale, analysis of the PPP options and financial model required the engagement Jamaica 5 Port Community Systems of a financial consultant, which was recruited through an inter- Functional and technical architecture national tender process. Extensive work was done to develop a robust financial model with the aid of a local consultant. Factors From a technical perspective, the platform is an off-the-shelf solu- considered included: tion. The solution is hosted within a public cloud service provided by Microsoft Azure. Functionalities include email, web-services, • Trade activities -import/export/trans-shipment. SFTP and options for different messaging formats. Hence up-to- • Number of Customs declarations. date information is provided through messages (EDI). • Type/number of stakeholders in port community. • Assessment of subscription services and related fees. The PCS platform is managed internally by a technical team of • Assessment of PCS fees and revenue streams globally. the PCSO. The PCS application is managed by the application vendor. Data analytics is managed internally. In terms of the overall development cost, the PAJ estimated this as amounting to around US$12 million since 2016. These funds Regarding interoperability, the PCS and Customs solutions are were provided entirely by PAJ. integrated to provide transactions for cargo processing. This exchange was made possible by the signing of an MOU between The current fee structure, started in February 2022, consists of: the two entities. The eSAD Declarations are sent to Customs’ (a) User fees (@US$20/commercial import declaration). (b) A ASYCUDA World and manifests sent to the PCS. Both systems fixed fee paid by the 3-cargo terminal operators. (c) A portion are integrated and validate the information. The PCS also dissem- of revenues set aside for expansion and further developments. inates specific manifest information to customs, terminals, and regulatory agencies in the required format. Once cargo is cleared Recently, the PCSO brought forward a public advisory indicating and released by all the major stakeholders, the PCS provides the need for users to pay for PCS services directly to the operator. confirmation and then generates an electronic release. The mandatory fee is US$20 to be paid in Jamaican dollars. The PCS is also integrated with JCA and all three terminal Elements that will be potentially developed as value added operators’ operating systems, namely: KFTL with Navis (Kings- services include: ton container trans-shipment terminal), KWL with Tideworks (multi-purpose cargo terminal), and PHL with Advantum I. Providing more business intelligence information to users (Montego Bay multi-purpose terminal45). with specific data being made available online to all or per request. This will lead to greater revenue opportunities via Steps were taken to ensure the platform is reliable, consistent, fees and or subscription - per user/per month. resilient, and predictable. The cloud-based infrastructure allows this to be the case via multiple layers of redundancy that have II. Capacity building activities within the region to support PCS been built into its architecture and supported by teams that adoption rates, such as undertaking advisory and consul- continuously monitors system performance. tancy engagements to small regional states. The PCS also increased data security. This is achieved via multi- III. Technical support, project management and advisory ple layers of protection relying on the security ecosystem upheld services to other regional ports seeking to implement their by Microsoft and other third-party security solutions. own PCS solution. IV. Additionally, each year a portion of the revenue will be Benefits and impact allocated for future expansion of services and added functionalities. Feedback from the port community has been positive. Termi- nals now receive manifests via the PCS. Market measures apply For the PAJ, amendments were also made to facilitate the collec- to push towards compliance. Manual entries are, for instance, tion of user fees. This opened opportunities for more fee-based discouraged by means of applicable fees levied by the operators. services to be provided to the port community, who themselves are keen to obtain more digitalized processing of tasks. Truckers also indicated that they have seen improvements. These stakeholders can book a pick-up via PCS (directly or via agents). Benefits include faster, more efficient Customs clearance, more streamlined standard process, faster turn-around of gate in-gate- out operations with less gate congestions (no long lines). 45 Other Features of PCS are well presented and described on the Jamaica PCS website (www.jamaicapcs.com). Jamaica 6 Port Community Systems Besides notable benefits, there are also two noted challenges. This committee continues to meet monthly and actively leads the Firstly, manual entry of data continues to apply in the case of strategic activities of the PCS for the Jamaican Port Community. the terminal operator. This is due to lack of full standardization and harmonization of data formats. Terminal operators therefore From a macro-perspective, stakeholders had high expectations still need the solution to provide PCS data in a format that can from the implementation of the PCS. Along with other initiatives, seamlessly be included in their existing systems. such as the privatization of the container terminal and airports (SIA and NMIA), reform and modernization of Customs via The second is the continued need to use a broker by the truck- ASYCUDA, the developments of LNG facilities near Port Logistics ing community. Truckers are not allowed to make changes to Industrial Parks, the PCS platform was seen as a core initiative. appointments that they did not create. This means that when The aim was to facilitate efficient cargo transactions and support brokers make the booking, truckers themselves may face chal- Jamaica’s logistics hub ambitions. lenges to change these. The PCS enhanced its service so that the broker or importer can check a flag to allow truckers to make One of the key instruments enabling the implementation of updates. This has, however, not been taken up by the community the initiative was the MOU signed between the Port Authority as much as needed. and Customs to ensure interoperability of the systems. This enabled an effective integration and smoother user experience. In addition, regulatory changes, including making the use of the Key takeaways PCS for certain information exchanges mandatory all provided the enabling framework for the project. The PCS initiative in Jamaica was implemented thanks to government driven policy. It was part of a broader set of initia- Another key element of the case study is the shift from an earlier tives driven by the need to improve performance in Jamaica’s concept of the project being implemented on a PPP basis, to the ports and airports. This was for the purpose of positioning decision of financing the project through government funding. Jamaica within the sphere of a global logistics hub. Key lead- This allowed for user fees to remain low, at least for the initial ing entities of the initiative included the Port Authority, Customs, period of the implementation. It also overcame potential issues and the private sector. concerning information sharing and sensitivities around this. The PCS implementation was a change management project. Looking ahead, the PCS in Jamaica intends to rollout more value- Business process re-engineering and stakeholder participation added services once all the modules have been implemented. It were key success factors. The governance framework that was plans to facilitate greater utilization, improve efficiencies, lower established from the early stages of pre-implementation fostered costs, and provide more attractive domestic and international an environment in which stakeholders were included. They were logistics and supply chain solution to users of Jamaica’s (air able to review, provide input and approve all the new processes. and sea) ports.