Customs professionals play a crucial role in facilitating international trade and ensuring that goods are imported and exported legally and safely. They are responsible for ensuring that imports and exports comply with laws and regulations related to trade, such as tariffs, duties, and quotas. According to professor dr. Kārlis Ketners, any company that operates across international borders must maintain an up-to-date knowledge of the tax regime in any country they conduct business in as worldwide tax authorities become increasingly stringent in their attitude towards ensuring tax law compliance. Vytautas Magnus University Agriculture Academy (VMU AA) invites to study an intensive online one-year MBA programme “Customs Process Management” which focuses on the preparation of high-level managers for business and public sector organizations operating in the field of customs and, according to associate professor Erika Besusparienė, is intended for individuals who aspire to became leaders in the customs business.
Customs professionals are on a quest to find the best balance
According to professor dr. Kārlis Ketners, the global world changed in the last decades, and customs professionals’ work is changing and stuffed with new challenges. “Trade networks have grown in complexity. Transport and logistics services were redistributed and changed, with benefits depending on improved reliability and cost reduction. However, the capacity to ensure transparency and observe the flow of goods has not kept pace with these changes, leading to risks for the public regarding safety and security, possible loss of taxes and duties and a decrease in the quality of service”, notes dr. Kārlis Ketners.
Professor draws attention to the fact that customs professionals are now on a quest to find the best balance involving trade facilitation and enforcement and related innovative solutions. “Higher education and academic research introduce innovative solutions for trade facilitation and improved compliance, improving data visibility and data-driven decisions“, says dr. Kārlis Ketners. “The essential underlying idea is to re-use reliable commercial data for regulatory control, where possible, coordinated border management (CBM) and the development of an electronic Single Window (the use of reporting data by different governmental agencies).”
Customs personnel face new challenges
Dr. Kārlis Ketners notes that previously, customs officers used to be primarily focused on the physical inspection of goods and were trained in the practical inspection that included legal knowledge, while the business professionals in charge of customs issues were trained to classify goods and fill in declarations. Today, the increasing complexity of regulatory demands, the reliance on IT and the adoption of new supervision models with integrated risk management and control all require customs professionals with specific customs management skills.
As knowledge and expertise requirements have become much more demanding, enhancing knowledge of business processes and traders’ commercial drivers is also required. “Higher education programmes are needed to help existing customs personnel to develop themselves further in order to cope with these new challenges. Also, business professionals dealing with customs issues need, in order to be compliant, in-depth knowledge of the legislation in force, the risks involved and the control measures to be implemented, including those touching on the company’s information systems and these professionals need to work at a strategic level, with detailed knowledge of the impact of customs regulations on processes”, says author of various scientific and study books on taxation matters dr. Kārlis Ketners.
Knowledge of different taxation systems – benefit for international business
According to the professor, international trade transactions and the functioning of supply chains require knowledge of domestic taxation of different countries, international taxation agreements to avoid double taxation and the use of differences of diverse domestic tax systems around the world to evaluate taxation on businesses using variable tax rates, compliance requirements, tax incentives and other provisions. “Taxation is a dynamic and contradictory process in many ways. International business taxation mainly involves a process of the bargain between corporate bodies and tax officials. For businesses that trade and operate in more than one country, the value of international tax knowledge cannot be underestimated, bringing together the complexities of international tax legislation, including ongoing changes, developments within business planning and commercial and political changes worldwide”, comments dr. Kārlis Ketners.
“Regular international tax planning allows a business to gain from a clearer picture of tax benefits, tax incentives and tax reliefs available in different countries, the consequences of capital movement within areas of the business and across borders, amendments to the tax legislation, whether in the business’s home country or a foreign country that the business deals with possible clashes between the requirements of tax regimes in different countries and interaction between business goals and future tax planning aims and requirements”, notes dr. Kārlis Ketners.
Professor takes notice of the fact that the tax function in business management is becoming more complex and involved, growing to include consideration of the increasingly complicated tax laws, changes to legislation, and the ongoing monitoring required to achieve and maintain compliance. In the context of international business, the tax function must ensure that the company is meeting their home tax liabilities and tax liabilities to international authorities and that payment is made during the correct time period for each country.
Study programme for future leaders in the customs business
Associate professor of VMU AA dr. Erika Besusparienė suggests considering that the MBA study programme ‘Customs Process Management’ is intended for individuals who want to seek the career or be leaders in the customs business. “Currently, this is the first MBA study programme in the field of customs knowledge in Lithuania, perhaps even in the European context. In general, master’s studies in the field of customs are faced with two challenges – in some countries, studies are conducted in the national language of the country; in others countries, the customs field is only touched upon as a specialization”, says dr. Erika Besusparienė.
She reveals that in discussions with business and following changes in the European Union (EU), VMU AA aims for the study programme to look at the field of customs both in depth and to combine other necessary competences. “The main pillars in creating the programme were Education in Customs on the EU Customs Competency Framework and the vision of EU Customs 2040, so we combined customs and taxes in the study programme. Of course, these areas alone are not enough for a future leader, so in the study programme “Customs Process Management” we also included international trade through supply chains, sustainable customs management, communication, and taking into account new risks, we added social responsibility and ethics, as well as environmental instruments”, observes dr. Erika Besusparienė.
Responds to the needs of the market
Dr. Erika Besusparienė discloses that the need to create a study programme “Customs Process Management” arose from the market. The teachers and researchers of VMU AA Faculty of Bioeconomy Development are strong in the fields of taxes and logistics, so Head of the Lithuania Customs Practitioners Association Enrika Naujokė approached our faculty about the need to educate people working in the field of customs. Our first joint work was the creation of a course for customs brokers. Our second step was the creation of this study programme “Customs Process Management”.
Associated professor notes that the field of customs did not find a place as an academic discipline for a long time. Some saw it as a self-explanatory tax object (through customs duties and other customs charges), others saw it as part of logistics or supply chains. This is where we faced the problem that business needs leaders with deep knowledge of the customs field, but such leaders were not prepared. The stakeholders together with the World Customs Organization established the International Network of Customs Universities (INCU) and only in 2010 (after the certification of 3 universities) at the international level, the field of Customs was recognized as an academic discipline.
Moreover, according to dr. Erika Besusparienė, the youth of customs as an academic discipline affects many problems – businesses lack employees in the field of customs; in the company the responsibility of the customs field moves between finance, logistics or other departments. Therefore, in response to the needs of the market, together with social partners, we created this study programme.
Opportunity to change career or move up the career ladder
Dr. Erika Besusparienė draws attention to the fact that if a person wants to change his career or move up the career ladder, the MBA study programme “Customs Process Management” can open the door to that. “We closely cooperate with the Lithuania Customs Practitioners Association, we are members of INCU, and we also became members of Customs Knowledge Institute. Students of our study programme will also have opportunities to participate in these international networks, deepen their knowledge, make their own international network, and this will certainly provide them with new career perspectives. Therefore, if a person has worked after completing bachelor’s studies, and has accumulated 3 years of experience after graduation (regardless of whether he worked as a manager, accountant, logic worker or other employee), he can enroll in the MBA study programme”, says dr. Erika Besusparienė and notes that the most important thing is the internal motivation to climb the career ladder.
Online studies for working people
Dr. Erika Besusparienė notes three main reasons why studies are organised mainly online. „The MBA study programme “Customs Process Management” is intended for working people or who may already have their own businesses, so time can be devoted to increasing knowledge and competences only after work. Another reason is digital skills and the new generation.
We think that some of our students will be representatives of generation Z (~28 years old), who will be considering career options and possibly choosing our study programme. They are using technology 24/7 and it is even easier for them to absorb knowledge, as we use active digital tools during lectures“, reveals dr. Erika Besusparienė.
Most importantly, she says that academy has international teachers in the MBA study programme, who add value to learning about the customs field from different countries’ experiences, therefore, thanks to online studies, it is easier for foreign teachers to connect with students. She notes that in the vision prepared by the EU, Customs 2040 – all EU customs are seen as one common customs in the EU with common regulation and common rules.
However, dr. Erika Besusparienė mentions that face-to-face communication is not less important. „In Lithuania, online studies are not considered 100% distance, so in MBA study programme “Customs Process Management” we will allocate 10% for face-to-face meetings. Therefore, we plan to bring students and teachers together 1–2 times per semester for creative workshops, events, project preparation or presentation“, says dr. Erika Besusparienė.
Online studies and smart technologies
The VMU strategy defines the importance of online studies applying the smart technologies. Focusing on working people, we offer an MBA study programme “Customs Process Management” as online with the use of technological solutions.
Dr. Erika Besusparienė observes that the content of the course and the technologies used depend on the teacher of the course, study course adapted to online usually consist of text materials, videos, records, case studies, active working documents in the cloud, tasks based on the principles of games. Lectures take place synchronously, but the student also has the possibility of asynchronous learning (join only at his convenient time), participating in a discussion, reviewing previous recordings.
Emergence of new international programme is very timely
Director of Lithuanian Customs Practitioners Association and co-founder of the customs knowledge platform CustomsClear, Enrika Naujokė pays attention that it is symbolic that the study programme starts in a year when the World Customs Organization’s traditional theme for the year is knowledge sharing. This reflects the growing importance of the customs field and knowledge. Academic programmes in the field of customs are relatively recent, so the emergence of this new international programme is very timely.
The field itself is very complex – customs controls cover not only customs legislation but also so-called non-customs legislation. “Customs is on the „front lines“ of ensuring that only safe, compliant products enter the market and that the required taxes are duly paid. In addition, today we are all aware of export controls and sanctions, which are also the responsibility of customs. Last but not least, on the Green Deal, customs will play an important role in ensuring that environmentally friendly products enter the markets. Effective controls start with knowledge, which is equally necessary for businesses to ensure that goods do not get stuck at the border or run into problems later on during a customs audit”, observes Enrika Naujokė.
She emphasises importance of knowledge and draws attention that customs is increasingly focusing on post-clearance audits (to increase border capacity) – such checks often result in additional fees, fines, penalties and amounts that can run into hundreds of thousands of euros. “If the goods are intercepted at the border, either the costs of resolving the discrepancies identified will be incurred or the goods may not be allowed to enter at all. In addition to the company’s loss, it is important to note that in Lithuania, employees are also liable. Responsibility is enshrined in the Code of Administrative Offences. The fines imposed on an individual (declarant, manager, financier, etc.) can amount to several thousand euros”, notes Enrika Naujokė.
Opportunity to learn what is being discussed globally
Project Leader in the Indirect Tax Department at PwC Lithuania Monika Bielskienė assumes that such a customs process-oriented programme has been sorely lacking in Lithuania. “We have courses for customs brokers, we have bachelor’s degrees, but in principle there were no opportunities to go further into the nuances, to go to a higher level, to analyse the issues that are being discussed globally. Also, the uniqueness of this programme – that it is suitable for both the public and the private sector – will hopefully become another platform for networking in the customs community”, says Monika Bielskienė.
She pays attention that the need for competences grows with each passing year. This is due to the growing number of pieces of legislation. Also, due to case law interpreting the legislation and sometimes shifting its application in unexpected (and unfortunately more complex) directions. Moreover, market faces transformation of forms and areas of commerce (the exponential growth of e-commerce, the circular economy). For all these reasons compliance is becoming increasingly costly and also increasingly painful if not addressed properly. On the other hand, new opportunities open to compliant businesses, like a wide range of simplified customs procedures. That is why experts with a sound customs knowledge are and will continue to be of a golden value”, summarises Monika Bielskienė.