Finally, Atlantic port operations of Limon and Moin, through which about 80% of imports are shipped, began using TICA just five months ago, in May of 2007. The steady progression in implementation proved to be a key factor in the successful launch of TICA in Limon and Moin. Those sister ports represent such a high percentage of import and export volume that TICA could not possibly be considered to be implemented without them, yet by the time TICA was about to be implemented in Limon even skeptics acknowledged that implementation of the system was a fait accompli. Given the traditional difficulty of instituting anything new and innovative in Limon, the manner in which TICA was introduced provides a valuable lesson in successful innovation.
Less Contact, Less Fraud
"I would summarize the recent history of Customs in 3 stages," says Juan L. Zu�iga, a former functionary who now works as commercial and customs consultant. "Before the 90s when we had a completely obsolete system with nothing automatic. Then in the 90s we migrated to an automated system in which pass-through of goods in which many shipments were not inspected was privileged, more than what you'd expect from automatization is generally felt to imply that people get fired! Nevertheless, Roberto Acu�a, the customs official responsible for TICA, notes that "we've actually added personnel."
He explains that "together with TICA, which is a technological tool, there has been a parallel structural reform of the customs and administrative processes. We have created a new department called 'Customs Risk Assessment' This is one of the best practices encouraged by the world customs organization in order to facilitate commerce and concentrate controls on what actually represents a risk. Since the law gives us 4 years to review (the accuracy of the import declaration), TICA has all the information." Acu�a explains that Customs uses various techniques in analyzing such information and determining when to investigate further. Some investigations after the fact might take place just days or months later. "After that, we have analysis of tendencies among different groups, corporations, importers..."
Transparency
In reference to such analysis, Desiderio Soto comes back to the fact that "Customs has changed from verification of merchandise (before TICA) to verification of processes and data (under TICA)." He explains that "the behavior of one company is contrasted against a similar company or with a competitor. The competitor says 'these items are classified as X" and so when we investigate we find that one of them is tending to classify correctly and pay duties while the other isn't. We find these tendencies through (analysis of) processes and information. Not through (inspection of] merchandise." Soto explains that "our legislation permits (companies to) change their declarations at any time. Any importer can change declarations from 4 years back whenever he wants.
This has one of two consequences. If the customs administration hasn't started an investigation of the company, then the company is forgiven 75% of the possible fines. If the customs administration has started an investigation, then the company pays all the fines. Soto expresses a preference for letting a company know that Customs may be interested in reviewing the company's import records, thus giving the company a chance to conduct an internal review and make corrections if they're needed. Likewise, companies are given the option of making "anticipated declarations" of imported merchandise in order to hear Customs' opinion regarding the classification of merchandise or the value of that merchandise. Soto notes that "we see fines as a way to ensure (proper) behavior, not as a rule in most cases."
Collections
Monetary benefits of TICA to the Customs Administration fall into two categories. The relatively easy savings to quantify are those generated by the change in payment procedures. Previous to TICA, banks charged a percentage of the taxes collected as commission. Under TICA, taxes are paid directly from importers' accounts to the Customs Administration, with a much lower per-transaction fee levied by the bank. The results are quantifiable and considerable. The accompanying chart shows that through June 30 the Customs Administration has realized a savings of C1,681 million colons (roughly $3.2 million) in bank commissions through TICA.
The other category of savings might derive from better import controls under TICA, but such savings are more difficult to quantify. The Customs Administration has attempted to illustrate the magnitude of such savings by drawing a straight percentage comparison of the income under TICA versus the income for the most recent same-month period under the previous system.
Doing Something Right
"TICA was the death word;' says Jeff Ducheneau, General Manager of Aero Casillas, "before it was launched. We thought customers were going to panic, they weren't going to buy anything anymore because they weren't going to want to pay taxes on every single item." AeroCasillas is one of several companies that provide P.O. boxes in Miami, and like its competitors has found itself importing increased volumes of Internet purchases for its customers through the Juan Santamaria airport. "Well, you know what? TICA is probably the best thing that has happened in our business;' Ducheneau goes on to say. "I really do mean that honestly. We operate in 30 countries. So whenever I travel outside of Costa Rica I'm reminded that I forget how bureaucratic Costa Rican Customs used to be. You used to have to fill out a form or piece of paper for every single item."
In this sense, Juan Zu�iga calls TICA "the essence of (Costa Rica's) obligations under CAFTA.' By which he means that any free trade agreement is meant to guarantee the legal and institutional conditions necessary to facilitate free trade, and TICA provides the technical framework necessary to ensure those conditions. For those citizens and residents wondering if the Costa Rican government is capable of any major reform, TICA provides a heartening illustration of what can go right. Despite doubts and complaints from shippers and importers, the system's implementation has been strategically calculated, remarkably smooth and demonstrably cost saving.
Government 
