NOTICE: Given the evolving COVID-19 situation examinees are responsible for checking the PDRI/PSI COVID-19 page (https://www.psionline.com/important-notice-update-concerning-covid-19-c…) regularly to find out if there is a vaccine or mask mandate at the registered testing site. It is THE EXAMINEE’S responsibility to stay up to date. CBP will NOT provide refunds for those who are not able to test as a result of being uninformed or noncompliant about the COVID-19 policy. CBP and PDRI/PSI recommend that the examinee checks the website regularly leading up to the exam, including the night before the CBLE.
Last week’s post described common roadblocks to establishing Export Compliance Programs. In some cases exporters may be under pressure to put a program in place quickly with the focus on creating the ECP manual. This approach ignores the foundation needed for an effective program. The likely result will be a glossy manual that will sit on the shelf and have little impact on operations.
Compliance professionals know that an effective ECP must include C- level commitment and involvement, sufficient funding, well defined and documented responsibilities, on-going training, and internal audits. Weak ECPs lack some of these elements and are simply window dressing or paper programs.
In house compliance professionals are often given responsibility without authority. Further, they may be at mid or lower management levels or in the wrong chain of command. With or without a formal ECP, compliance professionals must have the authority to place holds on questionable exports without being overruled by sales, finance, or supply chain. Well written protocols for resolving issues and releasing holds require C-level or legal approval.
All of the above illustrates the importance of compliance independence. This may mean reporting to the CEO, COO, or legal department in order to remove pressure from other groups.
If your in house compliance professional is not truly independent hire a consultant!
Exporters, what has prevented you from implementing an Export Compliance Program? Here are the most common self-imposed roadblocks:
Inertia- initial steps are taken to develop an Export Compliance Plan but progress stalls as more urgent tasks need attention.
Management believes that company is too small or doesn‘t export enough to need a formal ECP.
Lack of upper management commitmentand willingness to put in the time.
Management doesn’t want to spend the money or devote resources to create an ECP.
Compliance is managed at lower levels with limited authority to get the project done.
Reliance on Logistics Service Providers for compliance. While LSPs are valuable business partners, the exporter is ultimately responsible for compliance.
An effective Export Compliance Program includes these elements: Management Commitment, Risk Assessment, Export Authorization (Agency Jurisdiction), Record Keeping, Training, Audits, Handling Export Violations (Corrective Action), and Build and Maintain an ECP Manual.
The most important element, by far, is Management Commitment. C-Level executives must allocate resources, communicate the importance of an ECP throughout the organization, and hold everyone accountable. Without strong management commitment and involvement you will end up with a weak program.
I’ve never steered clear of controversy – so, a serious question. Why is it that people do not want to become Customs Brokers anymore? Maybe its the silly test? Only around 2400 people take the exam every year, with around 10-20% passing.
Do any other licensing exams have such low pass rates? Bar exam rates are much higher. I’m in favor of an exam with realistic chance of passing along with a continuing education requirement for brokers.
Anyone who has ever taken the CBLE (Customs Broker License Exam) knows that it is very challenging. Many of the questions seem obscure even to experienced brokers. Here is an opportunity to submit questions for future exams.
CBP welcomes the submittal of new questions for future broker exams. Please submit your questions to email@example.com with “Future Exam Questions” in the subject line.
Select HERE for the Guidelines on writing new questions.
You may be looking to add a logistics or compliance pro to your staff and, understandably, want to make a good selection. In the meantime let me suggest training your shippers in some export compliance basics. I have always warned that compliance should not be left to a busy shipping department. However, a few hours of training is a good investment as it will enable shippers to spot possible export violations before shipments leave your dock. It will also allow your new professional to focus on more strategic matters and hit the ground running.
Ad Hoc Logistics has several copyrighted training programs to get you started. Contact firstname.lastname@example.org for info.
A to Z of Managing Logistics
Exporting for Smart People ( Because You’re No Dummy)
Most exporters I have worked with use Schedule B codes on their documents and for their EEI filings. Schedule B and HTS codes do not always match, so clients often need to maintain two lists.
If you are maintaining separate parts lists for HTS and Schedule B codes this could be a time saver. Check out the Notice to Exporters on the Harmonized Tariff Schedule (2022 Basic Edition as well as Revisions).
Exporters may use HTS codes in place of Schedule B. Go to https://hts.usitc.gov/ and choose the view tab. As always, there are exceptions, but you may be able to avoid toggling between lists.