Factors impacting the negotiation of mutual recognition arrangements/ agreements of authorised economic operator programs: A literature review

This paper will review relevant literature with the aim to identify potential factors in the negotiation process of mutual recognition agreements/arrangements (MRA) of authorised economic operator (AEO) programs for future research. AEOs are defined in the the SAFE Framework of Standards to Secure and Facilitate Global Trade (SAFE Framework)as those companies or individuals who meet specified compliance standards and show a demonstrated commitment to supply chain security. Meanwhile, MRAs are the means through which two Customs administrations recognise each other’s validation and authorisations of AEOs and agree to provide mutual trade facilitation benefits to their AEOs. Negotiation appears to be a common activity in modern society. After the terrorist attacks on 11th September 2001 in the United States (US), the international community has witnessed an emerging type of international negotiation which is the negotiation to reach an AEO MRA. The review of literature concludes that there appear to be challenges that exist in AEO MRA negotiations. Those challenges are associated with many factors in negotiations, such as political will, trust (or confidence) in trading partners’ regulation environment, etc. Therefore, there is a need for an future empirical research for further understanding of how and to what extent these factors impacting on such negotiation process and outcome.