Last year Leschaco South Africa and Leschaco Indonesia have been awarded the Authorised Economic Operator (AEO) certification, which is a key element of the World Customs Organisation's (WCO) Customs-to-Business partnership. What makes AEO important for global trade and what are the main benefits of AEO certifications for freight forwarder and thus for their customers and partners?
AEO Certification in Detail
The concept of the Authorized Economic Operator was established in June 2005 as part of the World Customs Organization (WCO) SAFE Framework of Standards. This initiative aimed to improve security in global supply chains while also facilitating trade. Its official introduction to the European Union (EU) took place three years later, through the 2008 security amendments to the Community Customs Code (CCC). This way a framework to govern customs procedures in the EU was created.
Since 2008, the AEO certification has been increasingly adopted across EU states. The growing number of valid AEO authorizations up until 2024 shows the certification’s importance in the logistics sector. This upward trend reflects widespread confidence in the program and its benefits for both freight forwarders and their customers.
AEO certification is a cornerstone for global trade – it is not only securing global supply chains but also simplifying customs processes for businesses involved in cross-border operations.
There are two main types of AEO certifications: AEOC (Authorization for Customs Simplifications) which is tailored for businesses that meet specific standards for customs compliance, and AEOS (Authorization for Security and Safety) which is geared towards companies prioritizing security in their supply chains. A combined AEOC and AEOS certification provides the benefits of both.
Who Can Achieve AEO Status?
Any business operating within the EU and involved in customs-related activities is eligible to apply for AEO status. This is especially beneficial for companies like freight forwarders, who operate on a global level.
To qualify, companies must meet high standards and criteria such as compliance with customs legislation, appropriate record-keeping, financial solvency, and proven competence in security measures. After the application is submitted and approved, the AEO status granted is recognized across all EU Member States.
Benefits of AEO Certification
For logistics companies, AEO certification translates into diverse benefits regarding customer activities. In short, the following benefits are granted for customers of AEO-certified freight forwarders:
- Faster Delivery Times: The streamlined customs procedures reduce lead times and ensure on-time deliveries.
- Reduced Risk of Delays: There is a lower risk of delays caused by customs hold-ups, which is crucial for businesses that rely on tightly timed supply chains.
- Increased Supply Chain Security: Customers can be confident that their goods are being transported by a freight forwarder that adheres to strict security standards, reducing the risk of loss or theft during transit.
- Cost Efficiency: The operational efficiencies gained by AEO certification can lead to cost savings that are beneficial to customers.
AEO at Leschaco
For us as Leschaco quality and reliability of offered logistics services are of utmost importance. Achieving AEO certification underscores our commitment to providing high-quality and reliable logistics services. This certification promotes close cooperation with customs authorities, resulting in improved planning, customer service, and reduced delays and costs. We are dedicated to continually improve our service quality for our customers and expand our AEO-certified subsidiaries.
AEO certification is a step in the direction of streamlined and reliable logistics and supply chain solutions for our customers, fostering close cooperation with customs authorities and leading to better planning, customer service, and reduced delays and costs.
