Digitalization in the Road Transport Industry: Ready for Disruption (Part II)

Challenges when exchanging digital transport documents

Although digitally optimized information exchange would considerably reduce the efforts involved in the transaction process described above, including the issuance of the necessary documents on paper and the manual process of their signature, it is still not fully accepted by authorities and businesses due to the following challenges:

• Standardization of electronic documents: One of the main practical barriers is that every region has different trading documents (Civelek et al., 2017, p. 75).
• Low acceptance of electronic information or documents by authorities: Multiple legal requirements and fragmented legal frameworks at international and national level lead to low acceptance of electronic documents by enforcement authorities and courts. (European Commission, 2018b, p. 12; Koroleva et al., 2019, p. 6)
• Technical interoperability from covering cross-border information exchange: A lack of cooperation and insufficient funding support leads to only regional standardization initiatives. Technical standards are needed to allow interoperability between different solution providers and authorities (Burinskiene, 2019, p. 9).

Despite the mentioned challenges above, many advantages of digital information exchange are predicted to arise when leading initiatives and associations can meet the requirements from the participating parties:

Instant payment:
The integration of financial flows reduces the cash cycles from all business stakeholders involved, because they can instantly issue the invoice for their work (Wagener et al., 2020, p. 204).

Operational speed in freight transport:
Due to faster processing of documents by authorities, companies can reduce the time spent dealing with cabotage, import/export customs declaration and border control (Burinskiene, 2019, p. 10).

Improvement of customer service, collaboration and transparency with partners:
Electronic documents can be controlled and monitored in real-time, providing access to information, proof of pick-up and delivery. Furthermore, the information collected in the database can be reused for other activities (Burinskiene, 2019, p. 20).

Efforts related to the physical management of paper documents:
The usage of electronic documents reduces administrative costs such as manual data entry or paper archiving, compliance costs, modal shift and congestion costs for both businesses and authorities (European Commission, 2018a, p. 11).

Reduction of susceptibility to errors due to automatic transfer of information:
Strongly paper-based processes cause a high error rate due to the frequent manual transfer of information
(Fridgen et al., 2019, p. 8).

Environmental impact:
Electronic transport information and documentation exchange leads to CO₂ emission savings related to changes in volumes and patterns in traffic. In addition, natural resources such as oil, paper and energy can be used more efficiently (European Commission, 2018a, p. 11).

The vision is that all stakeholders involved in a foreign trade transaction should be able to use the same documents and connect to each other even with varying solutions being implemented (Civelek et al., 2017, p. 78). One of the associations pursuing this vision is the Digital Transport and Logistics Forum (DTLF). They are a group of experts from different transport and logistics communities from both the private and the public sector with the goal of contributing to this topic at an EU level. They classify the transport documents in three categories:

• Goods related documents (freight documents): This category is divided into two sub-groups. On the one hand, documents, which serve the purpose of contract of carriage such as consignment notes, waybills and bills of lading. On the other hand, documents concerning the goods or certain customs documents like certificates of origin, dangerous goods certificates or cleaning reports.

• Transport means related documents: These documents are connected to a safety information such as the usage of the product, its nationality, certification, registration and insurance.

• Personnel related documents: The third category contains information on the qualifications and nationality of the transport operator. One example is a passport to prove that a person is allowed to work within a country.