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The new EU Regulation for digital transport could save up to EUR 27 billion

Technological trends and changes affect every segment of society and the economy, including the transport sector and transport regulations.

To survive and maintain its innovation and digitization place, the European Union and its industrial sectors must face new challenges.

Almost 99% of all cross-border transport in the EU still involves paper documents in at least one freight transport phase.

On processing this information, 380 million hours are spent. This leads to reduced efficiency of all market participants in the transportation and logistics chain and harms the environment.

In the last 20 years, total freight transport in the European Union has increased by almost 25%.

According to the European Parliament estimates, by 2050, freight transport is expected to increase by more than 50%, then paper documentation will become a severe problem in the coming years.

Significant changes will be in place for truck operators and their drivers in the next few years.

These changes include several Regulations that should improve working conditions and business processes. One of them is the eFTI Regulation (EU Regulation 2020/1056 on electronic information in freight transport), the subject of this article.

The European Parliament has repeatedly called for a stronger incentive for electronic documentation in freight transport.

Parliament also called for a simplified, uninterrupted, transparent, secure, and reliable transfer of paperless information between businesses, consumers, and the sector's authorities.

To save time and money, the European Union has approved transport regulations on electronic freight documents (eFTI).

Based on a proposal from the European Commission, the European Parliament and the Council of the European Union have approved a new Regulation on Electronic Freight Transport Information, which has been published in the Official Journal of the EU.

Paper documentation represents a significant administrative burden and additional costs for logistics operators and related industries (such as trade and manufacturing). It is particularly unfavorable for small and medium-sized enterprises and harms the environment.

The regulation aims to encourage freight transport and logistics' digitization to cut administrative costs, improve the competent authorities' enforcement capacity, and increase transport efficiency and sustainability.

The regulation will enter into force in August 2024 and set up a legal framework according to which road, rail, sea and air transport operators will share information with the executive authorities in electronic form. This is a crucial step that will bring significant benefits to road freight transport within the EU.

The new legal provisions set up a single legal framework for the electronic communication of regulatory information between economic operators and competent authorities. This should save tens of billions of euros in administrative costs.

The Regulation lays down the conditions under which the competent authorities must receive information in electronic form.

The primary requirement is that economic operators use secure and certified platforms based on information and communications technology (ICT) to exchange information with the competent authorities electronically.

The efficiency of freight transport and logistics is crucial for the growth and competitiveness of the European Union's economy, the internal market's functioning, and all EU regions' social and economic cohesion.

Advantages of using electronic information

The two main reasons for the slower introduction of electronic transport documents have been the lack of recognition of electronic documents' legal equivalence by the authorities and the fragmented IT environment without established and interoperable systems.

This practice is slowly being monitored, as an increasing number of IT solutions are being used in Europe to exchange freight information.

These solutions' incompatibility often leads to drivers giving paper documents preference, which is an expensive and time-consuming process.

As a single legal framework, eFTI will standardize the use of information in electronic form. This will encourage carriers to switch to digital solutions, facilitate law enforcement and reduce waiting times during inspections.

The new regulation is the first step towards further digitization of transport, as was the eCMR protocol that was ratified by all European Union members.

Using eCMR (electronic version of the consignment note) instead of its paper alternative (CMR) has so far proved to be inexpensive and more efficient.

The CMR Convention was drafted by the UN in 1956 to provide a single legal framework for national and international road freight transport. Since September 2019, it has been ratified by 45 countries.

In February 2008, an e-protocol (so-called eCMR) was added to the CMR convention. The e-protocol provides the legal framework and standards for using electronic means of recording a CMR consignment note.

According to European Commission estimates, reducing the work's administrative part due to digital forms will save operators up to 27 billion euros over the next 20 years.

The economic impact of the COVID-19 pandemic on the transport of goods in Europe is estimated at 64 billion euros for 2020. This form of saving is a great relief to service providers.

The digitization of freight transport and logistics in this way is expected to lead to significant administrative savings for both companies and governments.

The new eFTI regulation will increase transport efficiency, reduce operating costs, simplify the transport process and implementation, and remove language barriers.

This is the right decision for the transport and logistics industry as it will significantly improve transport efficiency in the EU internal market.

The eFTI platform's use ensures the guaranteed acceptance of regulatory information by economic operators and provides competent authorities with reliable and secure access to that information.

Here you can download the full text of Regulation 2020/1056.

Harmonized data exchange

The European Commission will develop technical specifications for the eFTI platform by 2022.

EC will be responsible for developing technical specifications, such as functional requirements for eFTI platforms and data transmission rules, processing, and protection.

Member States will then have 30 months to set up an electronic information exchange platform.

To prove compliance with legal requirements, companies will submit documentation via a certified platform. The Regulation obliges all competent public authorities to accept this information in electronic form.

The digitization of freight transport will save companies high costs and make it more sustainable and efficient. However, this does not imply an obligation for carriers to use only electronic documents.

The plan is that by August 2024, all carriers in the EU Member States will be able to submit information in electronic form using a harmonized format.

The commitment of all Member States and the definition of technical specifications tailored to operators' needs will be key to successfully implementing these regulations.

As a participant in the EU Digital Transport and Logistics Forum (DTLF), the IRU (International Road Transport Union) will implement eFTI platforms in a pragmatic way for operators.

Digitization, Big Data, and new technologies can change how traffic flows are organized and managed, generate business opportunities, and pave the way for innovation, new services, and business models.

The final goal of using digital technologies' opportunities is to boost growth, competitiveness, jobs and the internal market.

Such tools in the transport sector could improve the use of existing resources, enable better cooperation between supply chain actors, better visibility of the supply chain, traffic management and freight flows in real-time. They could also simplify and cut administrative burdens, with greater efficiency and cost reductions.

Transportation should become digital to reap all these benefits. Electronic data should flow smoothly through supply chains, including exchanging data with public authorities and between companies.

Advantages of using a digital platform

The Hubbig digital platform is also keeping pace with digitization. Hubbig allows you to search and order optimal transport in just a few clicks.

The platform itself automates the search for the optimal option for transporting a particular cargo. If you order online, the shipment and documents' entire travel flow will be automated, reducing communication steps.

The freight is available to the user on the computer screen during transport by ship, truck, and customs clearance. This is a complete innovation in the industry.

The Hubbig platform finds new clients for logisticians and gives clients (users of transport and forwarding services) a choice of a larger number of logisticians whose services they can choose and use.

The app works so that the client requesting freight transport gets several offers for the requested route and chooses the best offer according to the criteria of price, transit time and reviews.

The most significant advantage is that the documentation for a particular account is in one place, so you don't have to spend time searching your inbox.

The platform will also allow you to reduce email communication by 70% and save a lot of time. All necessary documents are posted online and available to all participants and are linked to a specific account.

There are no hidden costs and no surprises on our platform. Try the app now; make your business easier and save time when organizing freight.

If you have questions about our platform or you want additional information, please contact us because we have all the necessary solutions for all your transportation in one place!

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