export compliance global california 2009 april 3, 2009 santa clara, ca
TRANSCRIPT
Export ComplianceGlobal California 2009
April 3, 2009
Santa Clara, CA
2
EXPORT CONTROL BASICS
Export Controls are based on item, destination, end-user and end-use.
Export controls are designed to protect the national security, foreign policy and economic interests of the United States.
Source ; Bureau of Industry and Security Office of Export Enforcement
3
Criminal: 20 years imprisonment $250,000 fine ($1,000,000
corporation)
Civil: $250,000 max per violation or 2 x value of export and
potential Denial of export privileges
Source ; Bureau of Industry and Security Office of Export Enforcement
PENALTIES
4
PENALTIES
Avoid becoming an Enforcement Statistic. Make export compliance a priority!
Requires top-down commitment from the CEO to the warehouse. Look for Changes to the BIS Regulations Example – September 22, 2008, 115 new entries to the BIS Entities List
creating a license requirement for the export of all items subject to the EAR.
Source ; Bureau of Industry and Security Office of Export Enforcement
5
BASIC COMPLIANCE TOOLS
Have an Export Management and Compliance Plan. Write clear operating guidelines, distribute to all personnel and
provide training. Identify and publish all export control functions, responsible
personnel, and their contact information.
Source ; Bureau of Industry and Security Office of Export Enforcement
6
Compliance program design – there is no “one size fits all”– Use Export Management System Guidelines
Cited in 15 CFR sec 766 sup. 1 Described in detail on the BIS Web Site
– Use Internal Compliance Plan Guidelines 15 CFR sec 752.11
– Industry Best Practices
Source ; Bureau of Industry and Security Office of Export Enforcement
HOW TO DESIGN A COMPLIANCE PROGRAM
7
1. Whether the company has performed a meaningful risk analysis.
2. Existence of a formal written compliance program.
3. Appropriate senior officials responsible for compliance program.
4. Adequate training provided to employees.
5. Company effectively screens customers and transactions.
6. Company meets recordkeeping requirements.
7. Existence of internal system for reporting export violations.
8. Conducts and maintains results of export compliance audits.
9. Appropriate remedial activity taken in response to violations.
Source ; Bureau of Industry and Security Office of Export Enforcement
PRINCIPLES OF AN EFFECTIVE COMPLAINCE PROGRAM
8
Documentation
– Training records– Disciplinary records for violations of company policy– Due diligence/screening checklist– Evidence of record retention– Provide results of compliance audits– Clearly written designation of responsible personnel
Source ; Bureau of Industry and Security Office of Export Enforcement
EVIDENCE OF EFFECTIVE COMPLIANCE
9
Correct product classification: This is the exporter’s responsibility – classify, verify, and document!
Identify all parties to a transaction; verify legitimate intermediaries and name ultimate consignee on export records.
Source ; Bureau of Industry and Security Office of Export Enforcement
WHAT THE EXPORTER MUST KNOW
10
Be Aware of Diversion Risks!
Lists you must check prior to export:– Denied Parties– Embargoed countries– BIS Listed Entities– BIS General Orders
Exercise due diligence where Red Flags are present; refrain from/report questionable transactions.
Source ; Bureau of Industry and Security Office of Export Enforcement
“KNOW YOUR CUSTOMER” GUIDANCE
11
Research customers – internet is a great place to start. Whenever practical talk to new customers about their markets and
product applications. Learn to identify and recognize “Red Flags”. If there are “Red Flags” inquire.
Source ; Bureau of Industry and Security Office of Export Enforcement
“KNOW YOUR CUSTOMER” GUIDANCE
12
NUCLEAR WEAPONSCentrifuge High Speed Thermal CamerasMass SpectrometerVacuum Pumps
BIOLOGICAL WEAPONSBacterial StrainsCoated Valves and PumpsFermentersPresses
Source ; Bureau of Industry and Security Office of Export Enforcement
CHEMICAL WEAPONSPrecursor chemicalsCoolers/Heat ExchangersMixing Vessels
MISSILESCompositesMachine ToolsFilament Winding EquipAccelerometersVibration Test Equipment
EXAMPLES OF DUAL USE ITEMS
13
Overwhelmed by end of quarter orders and processing. New personnel using outdated go-by documentation. Export manager on vacation (cross train back up personnel). Lack of communication with sales staff and foreign distributors.
Source ; Bureau of Industry and Security Office of Export Enforcement
HOW VIOLATIONS HAPPEN IN GOOD COMPANIES
14
Incorrect ECCN
Improper use of NLR (No license required)
Incorrect Ultimate Consignee
If your forwarder completes your AES filing, ensure shipping instructions are clear and defined
Source ; Bureau of Industry and Security Office of Export Enforcement
INCOMPLETE/INCORRECT EEI INFORMATION
15
Identify all license conditions and identify any conflict with the sales transaction.
Resolve any conflicts before proceeding with transaction. Even if this means amending the license!
Notify intermediate and ultimate consignees of all BIS license conditions.
Submit all reporting as required by BIS license.
Source ; Bureau of Industry and Security Office of Export Enforcement
FAILURE TO INFORM ON LICENSE CONDITIONS
16
Summary
If you identify a violation, immediately assess and contain problem, work with your management to evaluate the benefits of voluntary disclosure to BIS/OEE.
Disclosures related to failure to obtain one-time review for use of the ENC exemption receive favorable treatment and are encouraged.
Source ; Bureau of Industry and Security Office of Export Enforcement
FedEx® Global Trade ManagerYour free, online shipping assistant
18September 2008FedEx Global Trade Manager
Common Challenges International Shippers Encounter:
Missing, incorrect or improperly completed documents Complying with regulations and laws
19September 2008FedEx Global Trade Manager
FedEx Global Trade Manager Solutions
With FedEx Global Trade Manager, you can:– Find the proper documents required for international shipping– Prepare, store and reuse customs documents online– View advisories concerning your shipment– Research country profiles– Search an up-to-date international denied-party-screening database– Use product profiles to manage your commodity information
20September 2008FedEx Global Trade Manager
Find International Documents
This tool helps you determine and print the documents needed to accompany your international shipments, both express and ground, thereby helping to ensure a smooth customs clearance
21September 2008FedEx Global Trade Manager
Find International Documents
Enter your origin and destination countries Select whether you’d like FedEx® Global Trade Manager to help you
find the particular documents you need for this shipment or to show you all the available documents pertinent to the import and export countries and shipment type you specified
22September 2008FedEx Global Trade Manager
Find International Documents
Enter the product information, including:– The name of the product– The Harmonized System Code (you can search for this right on
FedEx® Global Trade Manager)– The customs value– The country of manufacture
You have the option to save the product information in a product profile for fast and easy access at a later time
23September 2008FedEx Global Trade Manager
Find International Documents
View the list of recommended documents for your shipment, or a document list based on the import and export countries
Some of the most frequently used documents are available for online completion, including the Commercial Invoice, the Pro Forma Invoice, the NAFTA Certificate of Origin, the Certificate of Origin and the packing list
24September 2008FedEx Global Trade Manager
Document Preparation Center
Prepare, store and manage customs documents online. Save time avoiding duplicate entry of information when you save document profiles and reuse documents for future shipments.
25September 2008FedEx Global Trade Manager
Document Preparation Center
To begin, select one or more documents from to complete them online, and either print or click Ship to prepare your shipment.
Save document profiles for international shipments to edit and reuse a set of documents when you repeat similar shipments. Also initiate a similar shipment with your document profiles.
Each document profile relates to an international shipment you have already prepared. You can easily search and sort to access your profiles efficiently. You can also customize your view.
26
Prepared customs documents are stored in the Document Archive for complete visibility.
View and modify each document or create a document profile to reuse the document for future shipments.
Upload your company lettered to be used with your Commercial invoice and also upload a signature image for customized and professional documents.
September 2008FedEx Global Trade Manager
Document Preparation Center
Save partially completed documents to come back and finish at a more convenient time.
Select a pending document profile to resume preparation and complete or to delete as needed.
27September 2008FedEx Global Trade Manager
Document Preparation Center
All prepared customs documents are stored in the Document Archive for complete visibility.
View and modify each document or create a document profile to reuse the document for future shipments.
Upload your company lettered to be used with your Commercial invoices and also upload a signature image for customized and professional documents.
28September 2008FedEx Global Trade Manager
Advisories
This feature gives you important regulatory information for the import and export side of your transaction, as well as for the commodity you are shipping
29September 2008FedEx Global Trade Manager
Advisories
Enter your origin and destination countries, transaction currency, and shipping and insurance charges
Enter the product information, including:– The name of the product– The Harmonized System Code (you can search for this right on
FedEx® Global Trade Manager)– The customs value– The country of manufacture
You have the option to save the product information in a product profile for fast and easy access at a later time
FedEx Global Trade Manager prepares a report containing the applicable shipping advisories that you need to know about
30September 2008FedEx Global Trade Manager
Country Profiles
Provides an overview of essential, country-specific shipping information and regulatory requirements, including demographics, business information and statistics
This resource enables you to research a country upfront for sourcing decisions before you ship
31September 2008FedEx Global Trade Manager
Denied Party Screening
Identifies individuals, companies and other parties that have been denied the privilege of engaging in international business transactions
32September 2008FedEx Global Trade Manager
International Resource Center
Here you’ll find several useful tools and resources designed to make international shipping accessible and straightforward, including: – International shipping checklist– International shipping reference guide– Global trade links– FedEx international
shipping resources
33September 2008FedEx Global Trade Manager
FedEx Global Trade Manager
FedEx Global Trade Manager is just one more way FedEx can help simplify your shipping, saving you time and money and boosting your productivity
Log in today at https://gtm.fedex.com/GTM to see how easy it is!
34
Thank You