Samsung SDS has announced that it plans to build the first blockchain-based ‘export customs logistics services’ on its Nexledger platform. The Korea Customs Service (KCS) selected the company as its partner back in July 2018.
Also party to the agreement were 48 other relevant government offices and companies ranging from insurance to export-import public institutions.
While Samsung SDS will do the building and developing, the KCS will establish best-practice procedures and clearance and logistics services.
Four months ago KCS announced it was piloting a solution for Certificates of Origin which are used to determine tariffs.
Recent research by Bain & Co highlights the importance of establishing a customs ‘single window’ for importers and exporters. Bain found that establishing a single window radically reduces trade barriers as well as costs for all parties.
How will blockchain improve things?
What Samsung SDS’ platform offers is the ability for export-orientated firms and supply chains to quickly share documents at each stage of the export process. This means products can be verified, authentication given, and origins traced faster and more reliably than the current system.
Furthermore, since participants will likely upload product and export details to the Nexledger blockchain, forging documents will become extremely difficult. It is, after all, much harder to alter an entry in a blockchain, than to forge a document.
There is also good reason to be optimistic on the success of the project.
Last year, Samsung SDS demonstrated Nexledger’s security, speed and stability by promoting a shipping logistics pilot project which included 38 public, private, and research institutions. And just three weeks ago, they demonstrated a banking application.
“With the success of this project, we will strengthen our leadership in the blockchain-based logistics field and contribute to enhancing the competitiveness of national logistics,” commented Hyung-Tae Kim, executive vice president and leader of the logistics business unit at Samsung SDS.