12 Things Your Overseas Supplier Can Do To Expedite US Customs Clearance

Are you losing sleep at night worrying that your latest import order will not clear customs in time to meet your company's or customer's requirement? Or worse, are you wondering if the shipment will clear at all due to some 'administrative' error? Trade compliance can help.

The U.S. Customs and Border Protection (CBP) has 12 suggestions that you can make to your overseas suppliers to ensure faster customs clearance of your merchandise.

1. Include all information required on your customs invoices.

2. Prepare your invoices carefully. Type them clearly. Allow sufficient space between lines. Keep the data within each column.

3. Make sure that your invoices contain the information that would be shown on a well prepared packing list.

4. Mark and number each package so it can be identified with the corresponding marks and numbers appearing on your invoice.

5. Show a detailed description on your invoice of each item of merchandise contained in each individual package.

6. Mark your goods legibly and conspicuously with the country of origin unless they are specifically exempted from country of origin marking requirements.

7. Comply with the provisions of any special laws of the United States that may apply to your goods, such as laws relating to food, drugs, cosmetics, alcoholic beverages, radioactive materials, and others.

8. Observe the instructions closely with respect to invoicing, packaging, marking, labeling, etc., sent to you by your customer in the United States. He or she has probably made a careful check of the requirements that will have to be met when your merchandise arrives.

9. Work with CBP to develop packing standards for your commodities.

10. Establish sound security procedures at your facility and while transporting your goods for shipment. Do not give narcotics smugglers the opportunity to introduce narcotics into your shipment.

11. Consider shipping on a carrier participating in the Automated Manifest System (AMS).

12. If you use a licensed customs broker for your transaction, consider using a firm that participates in the Automated Broker Interface (ABI).

To learn more about export trade compliance, contact Compliance Assurance today.

When Was Your Last Internal Compliance Audit?

Now that you have written your compliance manual and trained your team you are "compliant", right? While that is a great start, an effective Export Management and Compliance Program (EMCP) requires internal and external trade compliance monitoring and periodic audits. In fact, the BIS considers the existence and result of an internal/external audit to be one of the nine principles of effective compliance programs for great weight mitigation in BIS's administrative cases.

When was the last time you had a thorough review of your trade compliance program? Was it performed by an unbiased, independent person or by the same individual who is responsible for the success or failure of the program?

Your company's accounting auditors would have no credibility unless they performed an independent and unbiased audit of a significant sampling of your financial transactions. By the same token, you should not accept the credibility of your trade compliance program without a similarly competent and thorough audit of your import and export transactions.

Export Trade Compliance - What Every Contract Manufacturer Needs to Know About Export Compliance

Contract manufacturers (CMs) have become the de facto production division for many U.S. companies. The reasons for this continued trend include outsourcing non-core competencies (i.e. manufacturing), reducing supply chain costs, reducing capital expenditures, and building flexibility into production operations.

The CM's customer who exports is required to comply with the U.S. Department of Commerce Export Administration Regulations (EAR) and the U.S. Department of State International Traffic in Arms Regulations (ITAR). The EAR has jurisdiction over "dual use" items, that is, those items with both commercial and military applications, while ITAR has jurisdiction over defense articles. But what about the CM's export compliance requirements?

CMs must first establish whether or not the assemblies or products they produce are under the jurisdiction of ITAR or EAR. For this reason it is important that the CM have a good understanding of their customer's business. Receiving drawings stamped "ITAR Controlled" are a sure bet that the products fall under ITAR jurisdiction. Are the assemblies used in defense, satellite or aerospace applications? Are the items used in telecommunications or commercial applications? If so, what are the end articles produced and what are their end-uses? CMs will likely already know the answers to these questions, which will help to determine the commodity jurisdiction.

Items under ITAR jurisdiction are defined on the U.S. Munitions List (USML), which can be found in CFR 22, Part 121. In addition to ammunition, missiles and explosives, this list includes military vessels, vehicles, aircraft, training equipment, protective personnel equipment, military electronics, optical and guidance control equipment.

It is imperative that the CM knows that the USML includes components, parts, accessories, attachments, and associated equipment specifically designed or modified for use with the equipment in each of the USML categories. Consequently, the subassemblies that a CM produces are controlled on the USML. In addition, ITAR Part 120.10 controls technical data which is required for the design, development, production, manufacture, assembly, operation, repair, testing, maintenance or modification of defense articles. This includes information in the form of blueprints, drawings, photographs, plans, instructions and documentation.

Items under EAR jurisdiction can be found on the Commerce Control List (CCL) in CFR 15, Part 774. The CCL includes items (commodities, software, and technology) subject to the authority of the U.S. Department of Commerce, Bureau of Industry and Security (BIS) and include "dual use" items as well as purely commercial items. The CCL does not include those items exclusively controlled for export by another department or agency of the U.S. Government. In instances where other agencies administer controls over related items, entries in the CCL will contain a reference to these controls.

If you are unsure of the export jurisdiction of an item or service, you should request a commodity jurisdiction (CJ) determination from the U.S. Department of State, Directorate of Defense Trade Controls (DDTC).

SO, WHAT DOES A CM NEED TO KNOW ABOUT EXPORT COMPLIANCE?

Under ITAR Jurisdiction
• Registration with the Department of State (DDTC). This is required even if the CM does not export the controlled items
• Notification of the DDTC of violations of criminal statutes, changes in senior management, changes in foreign ownership, and mergers and acquisitions
• Maintenance of records concerning the manufacture, acquisition and disposition of defense articles and technical data
• Application for licenses (or use of appropriate exemption) for exports of items on the USML
• Application for licenses (or use of appropriate exemption) for technology transfers of items on the USML to foreign persons or entities

Under EAR Jurisdiction

• Application for licenses (or use of appropriate exception) for exports of items on the CCL and Commerce Country Chart as required
• Application for licenses (or use of appropriate exception) for technology transfers to foreign persons or entities of items on the CCL and Commerce Country Chart as required
• Checking on end-user against government lists of prohibited parties/entities
• Ensuring that items are not intended for prohibited end-uses (i.e. WMD)

Failure to comply with these federal regulations can result in significant criminal penalties (possible prison sentences and fines) and civil action (e.g., fines and denial of export privileges).

For more information about corporate trade compliance or to contact an export trade compliance specialist please visit http://www.wearecompliant.com.