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Paper documents are gradually replaced by electronic information exchange and smoother transit in the European Union. The key role in the process is being played by the Electronic Freight Transport Information (eFTI) Regulation 2020/1056, which will be fully applied in 2025. Freight transportation without documents is not a vision anymore; rather, the journey has started and its impact goes beyond the EU borders.
The eFTI Regulation establishes a legal framework for digital freight transport information exchange and enforces the acceptance of information in electronic format among the EU authorities (if transporting business chooses to provide it in digital format). Also, the eFTI Regulation promotes multimodality among road, rail, inland waterways and air transport modes. The EU member states are already activated towards paperless transportation, as eFTI Regulation entered into force in 2020 and its requirements will be fully applicable as of August 2025.
The EU is the #1 trade partner in two EU neighbouring regions, the Western Balkans and the Eastern Partnership, which are significantly affected by the EU regulations and policies. The EU neighbouring regions seek to stay competitive in transport logistic chains and that is the reason why the EU neighbouring regions are willing to take steps towards harmonisation with the EU by initiating alignments with the eFTI Regulation and benefit from the same digital advancements.
In order to support the progress in the Eastern Partnership, EU4Digital Facility works towards minimising trade barriers and increasing trade volumes and speed of physical and digital processes in logistics by implementing cross-border testing (piloting) of innovative digital solutions. EU4Digital Facility is led by EY Baltics and aims to extend the European Union’s Digital Single Market to the Eastern Partner states, developing the potential of digital economy and society in order to bring economic growth, generate more jobs, improve people’s lives and help businesses.
EU4Digital phase I (2019-2022) is successfully complete. A number of activities focusing on cross-border paperless information exchange between government and businesses (B2G) as well as between businesses (B2B), including digital and automatic data exchange of customs information between logistics businesses and customs authorities, provides the grounds for the possible future eFTI deployment within the region.
According to Mr. Artūras Piliponis, EY Digital and Technology Leader for EU institutions and EU4Digital Facility Team leader, EY has already tested the exchange of electronic information between the customs authorities of the Republic of Moldova and Romania through the solution called SEED (System for the Exchange of Excise Data). During the pilot project, the participating customs administrations exchanged electronic data related to empty means of transport, which circulated in both directions. “Such pilot projects build practical understanding what benefits the digitalisation and cross-border cooperation brings and what challenges still need to be addresses from legal, organisational and technical perspectives. Also, they build the foundation and justification for future larger scale initiatives like eFTI and beyond” – says Artūras Piliponis.
Another activity under EU4Digital phase was a pilot of a standardised eInvoice data exchange between cross-border partners using Peppol eDelivery Network (30+ members in Europe and globally). This data exchange was piloted between Armenia-Ukraine, and Moldova-Ukraine as well as with the EU countries – Ukraine-Poland.
As a continuation, Phase II of EU4Digital Facility has started in 2022 covering Armenia, Azerbaijan, Belarus[1], Georgia, Moldova and Ukraine. The eFTI related activities have started aiming to design the roadmap of e-freight deployment by the end of 2023. The roadmap will include country-specific actions of developing and connecting eFTI gates and platforms in the Eastern Partnership with the EU, which would support authorities to obtain digital freight transport information filled in by the economic operators, both in the EU and in the neighbouring region.
Even though eFTI approach is not yet applied in non-EU countries and customs reporting requirements are not part of eFTI yet, the discussions are going on in parallel. The EU neighbouring regions could greatly benefit by adopting eFTI Regulation in time. Business operators would benefit from simplified procedures and processes, reduced administrative burden, increased efficiency, which in turn results in faster transportation, earlier release of truck for next loads, and eventually a better vehicles utilisation. At the same time, authorities would benefit from better data accuracy, enhanced monitoring and control capabilities, real-time access to the information and overall operational efficiency.
Western Balkans, another EU neighbouring region, have already included implementation of the eFTI Regulation into their strategic documents (Strategy for Sustainable and Smart Mobility in the Western Balkans[2]). According to EY Senior Manager Rūta Šalvytė-Tamošiūnienė “The Western Balkans have already taken steps towards deployment of eFTI Regulation. With the help of EY Baltics, the business case for eFTI adoption in the Western Balkans was developed stating that at least EUR 27 million could be saved annually if all businesses exchanged freight transport information digitally. Also, sizeable environmental impact was estimated – conservatively more than 200,000 boxes of printing paper or more than 25,000 trees could be saved on annual basis, which is more than the Central Park in the New York City“.
Currently, the Western Balkans have already started to follow the action plan on eFTI deployment to achieve the measurable milestones such as creation of multimodal eFTI gates and platforms that would help authorities to obtain digital freight transport information filled in by the economic operators.
The next steps that non-EU countries should take are to follow EU developments, understand their current state regarding the electronic information exchange in different transport modes, as well as develop the business case to evaluate the rationality of investing in the eFTI gates and platforms development. Importantly, non-EU countries should build awareness among key stakeholders and have a clear action plan that would help to start taking the practical steps towards trading with the EU in a paperless way.
Summary
EY is helping to transform freight transportation across the European Union (EU) and beyond. We are supporting countries and regions to enable eFTI Regulation and digital logistics overall, with the end goal to bring efficiency gains for businesses, while also empowering authorities with enhanced monitoring and control capabilities.
EY's work in this area extends beyond the EU - to the Western Balkans and Eastern Partnership.