International Trade Blog

If you are an exporter who submits your electronic export information through the Automated Export System (AES) on the Automated Commercial Environment (ACE), you've already set up an ACE account.

But if your companies relies on a third party like your freight forwarder to handle the ACE filings for your exports, you probably haven't bothered to set up an account.

While there's no requirement to set up an ACE account if you aren't doing your own AESDirect filings, you are missing an opportunity to use the ACE platform to help ensure your company is complying with U.S. export regulations.

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Restricted party lists (also called denied party lists) include names of organizations, companies or individuals that various U.S. agencies—and other international organizations and foreign governments—have identified as parties that one cannot do business with.

There are several reasons why a person or a company may be added to a restricted party list, which we’ve outlined in the article, Export Compliance: Understanding Restricted Party Screening. Essentially, they may be a terrorist organization or affiliated with such an organization, they may have a history of corrupt business practices, or they may otherwise pose a threat to national security.

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While it’s possible for importers and exporters to manually do all the work required for compliance, it can be a difficult task.

In addition to requiring deep knowledge of the regulations, manual compliance processes also demand constant, thoughtful attention to the import-export universe—including regulatory changes, product classification revisions, updates and additions to denied party and sanctions lists, and more.

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So, you’ve determined your goods need an export license? Good! That’s a great first step toward compliance—but you’ve still got some work to do.

If your products fall under the jurisdiction of the Export Administration Regulations (EAR), it’s time to submit an application for a license through the online Simplified Network Application Process Redesign (SNAP-R).

As you complete your application, keep an eye out for these five potential problems, which could delay your export license or even subject you to penalties, fines and civil or criminal prosecution.

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I talk to a lot of people who ask me, “How do I get a license to become an exporter?” That makes me nervous for them, because it shows a general lack of knowledge about what’s involved with exporting.

Obviously, not everyone who exports needs an export license. But some exports do, and knowing the difference is an important part of export compliance.

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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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