I’m not an economist (nor do I play one on TV), but this can’t be good. Canada is the US’s largest trading partner for exports and in the top 3 for imports. Supply chains linking the two nations are relatively short and logistics less complex.
If NLR is your default entry this is a wake up call. Thanks Jim Dickeson – Trade Compliance Geek #compliance
It’s finally happened. I’ve been saying for years that AES needed this simple edit check.
As you know, when you export an item with an ECCN whose reason for control is the same as the reason for control for your destination country, there is a license requirement. Either you need an export license, or there may be a license exception available. But if you filed the EEI in AES with the License Type C33 for No License Required (NLR), you would have a BIS export violation. No, AES wouldn’t tell you this. You’d just get the bad news at some point in the future. Along with a penalty of up to $250,000. Cha-ching!
Perhaps you have been “looking the other way” when it comes to export compliance. If you are lucky there have been no consequences for this negligence. CEOs and COOs, why not start off 2022 with a little executive action and move your organization towards compliance?
While a formal Export Compliance Program is the ideal solution, you may not be ready to commit the resources needed at this time. However, there are some steps that can be implemented immediately at little cost.
Here are a few best practices to help you get started :
1) Review and confirm correct Harmonized Tariff and Schedule B codes and maintain master list as updates occur. Proper classification follows established protocols and is the starting place for compliance.
2) Check Export Administration Regulations (EAR) for correct ECCN and license exception codes. Are you automatically using EAR99 and NLR? https://www.bis.doc.gov/ can help.
3) Confirm Country of Origin for all imports. This info is needed for your Commercial Invoice and is not always obvious, so consider consulting a Licensed Customs Broker.
4) Check common “Red Flags” such as denied parties lists, entities lists, and unverified lists. Once again, https://www.bis.doc.gov/ provides details and training.
5) Review export documentation for possible improvements.
Make export compliance a front-end process not a last minute shipping function. Remember, while Logistics Service Providers (LSPs) are valued partners, the exporter bears primary responsibility for compliance. Finally, if exporting under ITAR you need a responsible trained officer.
Contact email@example.com for immediate assistance.
In a recent post we discussed Country Commercial Guides published by the International Trade Administration, which is part of the US Department of Commerce.
The FTA Tariff Tool is another valuable ITA resource for exporters . This tool enables exporters to determine duty rates when shipping to foreign countries. Here is the link:
For help with international logistics contact firstname.lastname@example.org
Clear explanation of the issues.