Digitising paperwork could be one of the most effective innovations in freight
When we think of innovation in freight transport, typical examples might involve emissions cutting technologies, satellite navigation, or new materials like aluminium and carbon fibre. Yet one of the most effective advances could be an innovation that is unconnected to the physical movement of the vehicle. Rather, it is about cutting the paper bureaucracy that often clogs up transport logistics chains.
The decision by European Union Transport Ministers on June 6 to support digitalising freight transport information is expected to save both time and money – and help the environment. Indeed, the European Commission calculates that digitalisation will save transport sector up to 102 million working hours each year on paper documents management.
This is an unsung part of the entire mobility cycle, but it is nonetheless important. And it is closely connected with the EU’s Single Market: businesses will more readily think of the 28 countries as a single entity if they do not have to worry about tedious paper bureaucracy when their products cross borders.
The measure is part of the Commission’s third Europe on the Move proposal for a safe, clean and efficient mobility, unveiled in May 2018. The regulation aims to set up a harmonised, predictable and trusted environment for electronic communication between operators transporting goods and relevant authorities. EU Transport Commissioner Violeta Bulc said the measure was an important step for the EU’s ‘Vision Zero Paper’ in transport. The proposals were also welcomed by stakeholders, who range from the Association of European Vehicle Logistics (ECG) and the World Road Transport Organisation (IRU) to the World Shipping Council (WSC) and the European Community Shipowners Associations (ECSA).
The Commission says the main barrier for a wider use of digital transport is the varying and generally low degree of acceptance of digital documents. This situation is caused by a fragmented legal framework and an IT environment characterised by a multitude of non-interoperable systems for electronic information exchange. As a consequence, most freight transport companies continue to use paper documents. Digitalisation is thus less about the documents in themselves, and more about ensuring electronic sharing of the information these documents carry.
The Commission impact assessment noted that EU freight transport rose by almost 25% between 1995 and 2015 – and should further increase by 51% between 2015 and 2050. Paper documents are required at some point in 99% of cross-border operations. The assessment estimates that 387 million hours and €7.9 billion were spent processing freight transport information in 2018.
What does the measure actually do? The regulation creates a uniform legal framework for use and transmission of digital freight transport information (eFTI). Competent national authorities would have to accept information submitted by operators electronically on certified platforms – and implement that obligation in a uniform manner. Within three years of the new rules entering into force, the Commission will adopt common technical specifications to ensure interoperability between the various IT systems. Operators will still be able to present the information in paper format if they prefer to do so.
The measures come at a time of rapid technological change: blockchain, data pipelines and cloud solutions could transform the way cargo and traffic flows are organised and managed. They can link supply chain actors, improve supply chain visibility, and offer real-time management of traffic and cargo flows. This latest measure should bring more of the digital revolution to the transport sector. It will save time, help the environment, and make freight transport much smoother.