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Information on Exporting

By Ralph Hamilton,2014-06-27 10:40
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Information on Exporting ...

January 2009

    INFORMATION ON EXPORTING

Samuel Shapiro and Company, Inc. truly cares about their customers concerns and needs.

    With all of the changes and recent enforcement actions in the U.S. regarding exports, we

    have put together a guide to help exporters understand their responsibilities in today’s

    environment. The exporter has many responsibilities under U.S. Government

    regulations.

    We want exporters to understand that the Foreign Trade Regulations (FTR) places primary responsibility for compliance of the Electronic Export Information (EEI) or

    Shippers Export Declaration (SED) as commonly referred to, and the Automated Export

    System (AES) requirements on the exporter (U.S. principal party in interest). Acting

    through forwarding or other agent or delegating or re-delegating authority does not in and

    of itself relieve anyone of their compliance responsibility.

It is the exporter’s obligation to check the parties to your transaction (including freight

    forwarders, intermediate consignees, and the ultimate consignee) against the most recent

    "Excluded Parties Lists" There are currently several “lists” that must be checked for each

    and every export transaction. We have provided a link to the Bureau of Industry and

    Security (BIS) website which contains links to each of these lists for your convenience

    http://www.bis.doc.gov/ComplianceAndEnforcement/ListsToCheck.htm

In June 2007, the Department of Justice, National Security Division, appointed Steven W.

    Pelak, an 18-year veteran federal prosecutor, to serve as the Justice Department's

    first-ever National Export Control Coordinator (NECC) to improve the investigation and

    prosecution of illegal exports . Mr. Pelak is also responsible for ensuring full coordination

    between the Justice Department and the many other U.S. law enforcement, licensing and

    intelligence agencies that play a role in export enforcement. With this appointment, audits

    by the Foreign Trade Division of the U.S. Census Bureau, and the dedication of more and

    more resources focused on export enforcement over the past few years really shows how

    important Export control enforcement has become to the U.S. Government.

It is essential for exporters to review their operations to be sure they adhere to all export

    regulations. With various Government agencies doing audits on exporters, such as the

    Foreign Trade Division of the U.S. Census Bureau, the Bureau of Industry and Security,

    Office of Foreign Assets Control, and the State Department, exporters should look at their

    internal controls now to be certain they are compliant with all of the export regulations that

    govern their products. Please be sure you are prepared and ready for an export audit! If

    not, please contact compliance@shapiro.com for further information and assistance with your compliance program.

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     SOME QUESTIONS TO CONSIDER WHEN EXPORTING

    (Links provided to various sites for your convenience)

    A. Commodity type(s)? What is the intended use of the commodity? HTS or

    Schedule B Number(s) for commodity?

When exporting commodities from the United States (or releasing technology or source

    code to a foreign national in the United States), under U.S. law it is the responsibility of the

    exporter to classify the item(s) and to determine if an export license is required from any

    United States Government agency.

Link to the Harmonized Tariff Schedule: http://www.usitc.gov/tata/hts/bychapter/index.htm

Link to the Schedule B:

    http://www.census.gov/foreign-trade/schedules/b/2009/index.html

Schedule B Search Engine:

    http://www.census.gov/foreign-trade/schedules/b/index.html

    B. Are any of your commodities listed under the Commerce Control List

    (CCL)?

If your commodity does come under the CCL, the exporter must provide the Export

    Commodity Classification Number (ECCN), you must know if a license is required to your

    export destination, or if an exception can be used for each transaction.

Please refer to Part 774 (CCL) of the Export Administration Regulations:

    http://www.access.gpo.gov/bis/ear/ear_data.html#ccl

     Alphabetical Listing for the Commerce Control List:

    http://www.access.gpo.gov/bis/ear/pdf/indexccl.pdf

Please refer to the Bureau of Industry and Security (BIS) Website for more information

    concerning ECCN numbers, licenses, and exceptions.

    http://www.bis.doc.gov/Licensing/ExportingBasics.htm

There is also a list of Frequently Asked Questions from BIS which may assist you in

    determining whether your item or transaction requires some type of license, along with a

    list of FAQ’s regarding BIS licenses that can be found at the links below:

    https://www.bis.doc.gov/licensing/exporterfaq.html

http://www.bis.doc.gov/exportlicensingqanda.htm

BIS has also added an online training room to their website with easy to use

    training modules. We highly recommend these to our exporters. This can be

    accessed on the BIS website at:

    http://www.bis.doc.gov/seminarsandtraining/seminar-training.htm If you need assistance from BIS in determining your ECCN number, you can contact them

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via email at: https://www.bis.doc.gov/Forms/AskaCounselor.html

For counseling assistance by phone, you may contact one of the BIS counselors at

    202-482-4811 for Washington, DC or 949-660-0144 for California.

    * Please note-phone and email assistance is not binding, it is used for guidance purposes

    only.*

If you need to obtain a binding classification ruling from the BIS, please contact

    compliance@shapiro.com.

    C. Do any of your commodities fall within the International Traffic In Arms

    Regulations (ITAR)? Is your commodity referenced on the U.S. Munitions

    List?

    http://www.pmddtc.state.gov/regulations_laws/itar_consolidated.html

If your commodity does come under the ITAR, the exporter must provide the license

    number, or an ITAR exemption number for each transaction. Your company must also

    be registered with the United States Department of State, Directorate of Defense Trade

    Controls. http://www.pmddtc.state.gov/registration/index.html

Additional information will be necessary in order to transmit the required Automated

    Export System (AES) information.

Please refer to the U.S. Census Bureau Website for complete detailed AES information

    required on these transactions:

    http://www.census.gov/foreign-trade/aes/documentlibrary/usmldataelements.html#DDTC

    ExportLicenseNumber

Please refer to the U.S. Department of State web site for more information regarding the

    ITAR and the United States munitions list and getting started with Defense Trade.

    http://www.pmddtc.state.gov/documents/ddtc_getting_started.doc

    D. What countries do you export to?

The Office of Foreign Assets Control lists the sanctions and embargoes the U.S. has

    imposed on certain countries. The exporter must be aware of these country controls.

    http://www.treas.gov/offices/enforcement/ofac/

The U.S. Department of State also has a list of embargoed countries:

    http://pmddtc.state.gov/embargoed_countries/index.html

     E. What is the end use of your product?

This is a question that concerns the U.S. Government for security, national defense, and

    anti-terrorism reasons. Some end-uses are prohibited while others may require a license.

    For example, you may not export to certain entities involved in the proliferation of weapons

    of mass destruction (e.g., nuclear, biological, chemical) and the missiles to deliver them,

    without specific authorization, no matter what your item is. For more information on

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prohibited end- uses, please refer to Part 744 of the Export Administration Regulations.

    http://www.access.gpo.gov/bis/ear/ear_data.html

F. Are you shipping to the Middle East? Do you adhere to the antiboycott

    regulations?

Exporters must be aware of the antiboycott laws that were adopted to encourage, and in

    specified cases, require U.S. firms to refuse to participate in foreign boycotts that the

    United States does not sanction. They have the effect of preventing U.S. firms from being

    used to implement foreign policies of other nations which run counter to U.S. foreign

    policy.

    Additional information on antiboycott laws and practices can be found on the BIS website

    at: http://www.bis.doc.gov/complianceandenforcement/antiboycottcompliance.htm

Recent Examples of Boycott requests can be found on the BIS website:

    http://www.bis.doc.gov/antiboycottcompliance/oacantiboycottrequestexamples.ht

    ml

These types of requests or problematic language are often included in letters of credit.

    Shapiro has a letter of credit expert on staff to assist you with these needs. U.S.

    companies continue to report receiving requests to engage in activities that further or

    support the boycott of Israel. U.S. companies may receive similar requests in the future.

    Compliance with such requests may be prohibited by the Export Administration

    Regulations, and reportable to the Commerce Department. If you have questions, please

    call (202) 482-2381 and ask for the Duty Officer or you may Email BIS at

    https://www.bis.doc.gov/Forms/OACInquiryForm.html.

G. Have you checked the current “Red Flag” indicators provided by BIS for things

    to look for in an export transaction?

Use this as a check list to help identify possible violations of the Export Administration

    Regulations. http://www.bis.doc.gov/enforcement/redflags.htm

     H. Do you really know your customer?

Use the “Know Your Customer Guidance” provided by the BIS

    BIS has issued the following guidance on how individuals and firms should act under this

    knowledge standard. This guidance does not change or revise the EAR.

    http://www.bis.doc.gov/Enforcement/knowcust.htm.

I. Are your commodities considered to be Hazardous for shipping purposes?

     Each mode of shipping has specific hazmat regulations. The Federal Aviation

    Administration has been especially persistent in checking commodities and tracking it

    back to the exporter to see if the exporter’s staff has updated hazmat training. All modes of

    transportation have increased inspection of hazardous materials.

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Air Transportation (http://www.iata.org/whatwedo/cargo/dangerous_goods/index.htm)

Ocean Transportation: http://www.imo.org/Safety/mainframe.asp?topic_id=158

Land Transportation: http://www.phmsa.dot.gov/hazmat

    Rail Transportation http://hazmat.dot.gov/regs/ntsb/rail/ntsb_rail.htm

J. Do you understand your role as an exporter under the Foreign Trade

    Regulations? Is your company the USPPI in a routed export transaction?

    As an exporter or a company that sells goods and services to foreign entities, you need to understand your role and the role of the forwarder in the export transaction. Take a look at

    the Frequently Asked Questions from the Foreign Trade Regulations on the Census

    website regarding the USPPI, and the required information on the Shippers Export

    Declaration at: http://www.census.gov/foreign-trade/faq/reg/index.html

    LINKS TO U.S. REGULATIONS COVERING EXPORT

The Export Administration Regulations:

    http://www.access.gpo.gov/bis/ear/ear_data.html

The Foreign Trade Regulations:

    http://www.census.gov/foreign-trade/regulations/index.html#traderegulations

The International Traffic in Arms Regulations:

    http://www.pmddtc.state.gov/regulations_laws/itar_consolidated.html

CFR 19: http://www.access.gpo.gov/nara/cfr/waisidx_08/19cfrv2_08.html

If you don’t understand all of the information above and feel you need one on one

    consultation, please contact compliance@shapiro.com. Thank you.

**This document is intended to highlight some of the major responsibilities exporter’s have

    under U.S. Government regulations. This is not all inclusive and depending on your commodity, the exporter may have responsibilities under other U.S. Government

    agencies, such as FDA, USDA, NRC, DEA, DOJ, etc. Prior to exporting, please be sure to

    check with any agency that may have jurisdiction over your commodity. This document

    does not include Foreign Country of Export information. Laws vary depending on your

    country of export. **

All transactions and services are subject to and governed by our Terms and Conditions of

    Service, as may be amended, including a limitation of liability limited to a maximum of

    $50/entry or shipment. A copy may also be found on our website, www.shapiro.com, and

    is available by request at no charge. EKG 01/07/09

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