Companies that sell products internationally must deal with a maze of trade compliance laws and regulations that, if not correctly interpreted, can cause serious delays to on-time deliveries. Compliance involves a series of checks and balances between exporters, recipients and the Department of Commerce, Department of State and other regulatory agencies. Your company’s ability to navigate these laws will improve deliverability and ensure successful trade in a competitive environment without violating any trade rules or laws.
The rules defined
Companies in the business of exports must adhere to trade compliance rules as outlined in the Export Administration Regulations Act and other regulations that apply to their product. For example, the U.S Department of State has authority over Defense Articles and Services and enforces rules for these specialized products.
The Export Administration Regulations focuses primarily on the control of “dual-use” items. These are items that are used, or have the potential to be used in both military and civil applications and could adversely affect the national interest and security of the United States and its allies. Trade compliance ensures that all exports—tangible and intangible, are reviewed for the appropriate product classification, and license determination. In addition, due care and diligence are exercised in screening end-users on the various Entity lists to ensure the products are exported to users for the intended purpose.
Enforcing the rules and possible consequences
To enforce these rules, the Bureau of Industry and Security (BIS) routinely sends special agents from the Department of Commerce to overseas locations as Export Control Officers. These agents work with the local customs in the foreign country to ensure that there are no deviations of the product destination or its use. If these policies are violated there are consequences and severe penalties are imposed on violators. Penalties may include fines of up to $1,000,000 depending on the offense, and jail time up to 20 years for serious or repeat offenders. In addition, a company may lose its privileges to export entirely which means that they can no longer support their international customers and in general lose its share of the international market.
Export privileges could be suspended for several years. The company must take certain actions to improve their export process before the end of the suspension period if they want to export again. It should be pointed out that these laws apply not only to goods, but also to services and technology products that may be deemed sensitive to national security by the government.
There is help out there
NEI ships products around the world in full compliance with the U. S. Export Administration Regulation. We have the tools and resources to ensure that products shipped from the U. S. arrive at their destinations in a timely manner accompanied by all the appropriate documents – commercial invoice, certificates of origin, declarations of origin, and other necessary paperwork as required by the foreign customs authorities. In fact NEI can handle the entire process of exporting the product including coordination with the U.S. Principle Party in Interest, inspection agencies, freight forwarders, the foreign importer for final delivery and acceptance of the product at the end-user’s facility.
If your company needs additional assistance, please contact us at (877)792-9099. NEI (www.NEI.com), the experts at application deployment, can help guide you through the maze of trade compliance laws and regulations.