International Trade Blog

The U.S. Bureau of Industry and Security (BIS) has announced that license exception CIV (Civil End-Users) has been eliminated effective June 29, 2020. BIS also announced a related expansion of military end-use and end-user controls.

An export license exception allows you to export certain items that may be controlled by the U.S. Export Administration Regulations (EAR) without first obtaining an export license from the Commerce Department. For a more detailed explanation of export license exceptions, read my article: A Beginner's Guide to Export License Exceptions.

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Our office occasionally fields calls from people who are looking at our Shipping Solutions software as a short-term solution for their export documents while they are implementing their organization’s Enterprise Resource Planning (ERP) export modules.

The concerned callers on the other end of the phone are worried about how long their ERP trade/export modules are taking to implement, and they see our software as an affordable bridge, making their export departments more efficient.

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For exporters, OFAC compliance is non-negotiable: If you’re shipping to one of the people or companies identified by OFAC, you must be aware of the associated sanctions for every single shipment.

Unfortunately, this isn’t as simple as checking one list one time. OFAC lists may change at any time based on current events or changes in the political landscape.

And there isn’t just one single list that needs to be checked. The Federal Register compiles at least 125 relevant lists every day; and it’s up to you to keep up with them. Fortunately, there are best practices that can help you stay compliant with regulations. Read about them below.

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When it comes to export compliance, creating export documents, or, really, anything in the exporting realm, it’s definitely possible to do the work manually.

If you’re conscientious, thorough and pay attention to the universe surrounding what you’re trying to do—including changes in export regulations and general news—you certainly can do anything manually.

But...

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Those of us who’ve worked in exporting for a while are aware that government regulations on exports are primarily administered by either the Commerce Department’s Bureau of Industry and Security (BIS) via the Export Administration Regulations (EAR) or the State Department’s Directorate of Defense Trade Control (DDTC) via the International Traffic in Arms Regulations (ITAR).

BIS governs commercial and dual-use items, while DDTC governs military items. Successful, compliant organizations need to understand and abide by those regulations.

In addition, the U.S. Census Bureau, also part of the Commerce Department, administers the Foreign Trade Regulations (FTR), which require the reporting of electronic export information through the Automated Export System (AES). (You can learn more about the three primary sets of export regulations by reading: The Three R’s of Export Compliance: FTR, EAR and ITAR.)

That was my take on things. For a while. But I talk to more and more people whose exports (and imports) are controlled by other U.S. agencies.

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I get a lot of emails from exporters who are confused about whether or not their products require an export license. Their initial search through the Export Administration Regulations (EAR) indicate that they do, but then they hear or read about export license exceptions that may be available.

I've put together an overview that explains what license exceptions are and how they work. This discussion assumes you know the basics of export licenses. If you are new to the export license process, I recommend that you first download and read our free white paper, How to Determine if You Need an Export License.

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How many ways are there to classify things? When my kids were little my mother bought them way too many Beanie Babies, but sometimes it was fun (and kind of educational) to classify them. The Beanie Babies could be organized by type of animal or by color or by what they ate or type of habitat.

You could say that governments do the same thing with goods. Sometimes goods are classified on the basis of their objective characteristics. Sometimes they are classified based on their use. Today I’m going to compare two types of classifications, the Harmonized System (HS) codes and the Export Control Classification Numbers (ECCN).

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Export compliance regulations don't just apply to the big guys. Even the smallest U.S. businesses that send their products to customers outside the country are subject to a variety of export regulations and could face substantial penalties for violating these rules.

Unfortunately for many small and medium-sized businesses, company personnel may not know these requirements until it's too late.

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Where should you place your international trade compliance office within your importing or exporting organization? Should it be part of sales, accounting, shipping, legal, purchasing or supply chain?

My answer may seem flippant, and among readers of this blog, it may even seem controversial.

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When I first talk to exporters frustrated by the amount of time it takes to complete their export documentation, they often tell me they can spend two hours or more on every single shipment. If they have multiple export orders to ship, the time they have left to do any other part of their job is virtually nil.

A typical export shipment can require five or more documents including a commercial invoice, a packing list, a shipper’s letter of instruction, a bill of lading, and a certificate of origin. On top of that, a shipment valued at more than $2,500 per Schedule B code needs to be filed electronically through the Automated Export System (AES). And, of course, every shipment, regardless of value, needs to be screened against U.S. export regulations.

It’s easy to see why it can take so long!

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