In this dynamic business world, it is extremely crucial for a business entity or corporate sector to gain an extra edge over the competitors. And this objective might face a serious blow if the business fails to comply with the trade laws and regulations. Some of the consequences of violating the global trade laws and regulations include cancellation of import and export license and authorizations, denial of export privileges, administrative penalties and many more. The worst part is that the brand image might face a serious negative impact due to the legal proceedings for which the company might face significant reductions in the revenues.
International trading today is quite complex in terms of applicable rules and regulations. The complexities of the related laws have made the process a difficult one. International trading business includes many components like trading partners, competitive products, vendors, supply chain and many other inter-mediators. There are some trade compliance solutions that are required to screen all your suppliers, visitors, customers and also the trade partners.
What is ITAR compliance?
Perfect compliance with the U.S ITAR regulations and determination of the license or authorization needs are some of the important steps taken before involving with and trading defense articles. ITAR is the short form of International Traffic in Arms Regulations. It is a set of U.S government regulations that control the import, export and manufacture of defense articles listed on the U.S. Munitions List (USML), military end-use articles and related defense services. It first came into action in 1976 by introduction of Arms Export Control Act (AECA), and there has been a drastic growth in the last ten years. Some of the actions need to be taken before involvement with the ITAR export controlled items include but not limited to the following:
- Registration as a defense article manufacturer, broker or exporter with the U.S. Department of State – Directorate of Defense Trade Controls (DDTC).
- Review of materials and technology of applicable controls under ITAR.
- Obtaining necessary export license, authorization or approved agreements from the U.S. Department of State.
- Commodity Jurisdiction analysis.
- Preparation of Technology Control Plan.
- Preparation of Export Compliance Program.
The Benefits of Trade Compliant Software
The trade compliance software is essential in any export and import business. If your business export or import any material to a foreign country, it is best to use a customs and/or export compliance software to ensure the trade partners are not sanctioned or restricted, items are correctly classified and license determinations are accurately done.
Some of the Characteristics of the Trade Compliance Software
- It contains major U.S. and other country sanction and restricted party lists.
- It contains a step-by-step export classification and export license determination module.
- It manages your customer, vendor and other trade partner information and provides automated end-use and end-user screening function,
- It consists of the most up-to-date regulations and laws.
- It assists your company to gather all type of information you require to be in the compliance and also help you to determine the lines of accountability that are demanded by EAR, ITAR, FTR and NRC regulations.
The export classification, licensing and ITAR compliance are some of the trade compliance solutions that are required to check the trading members.