Effective Communications. Discussion Effective communications between exporters and freight forwarders

Transcription

1 Effective Communications Discussion Effective communications between exporters and freight forwarders

2 Today s Session Pre-planning the export transaction Regulatory controls Communications between shippers and forwarders Using the SLI to streamline communications Review and record keeping 2

3 Pre-planning the Export Transaction 3

4 Pre-planning the Export Sales Contract Deciding on INCOTERMS Who is responsible for what Payment Terms Who is paying for the freight Transaction Determining which US Government agency has jurisdiction over your product Will there be licensing requirements Determining destination country requirements 4

5 Pre-planning the Export Transaction Determining Mode of Transportation Cost vs. transit time Determining whether or not you will insure Selecting a freight forwarder / service provider or being told to use a certain freight forwarder on a Routed Export Transaction Preparing documents and instructions for service providers Reviewing shipping documents and regulatory reporting 5

6 Regulatory Controls 6

7 Regulatory Controls Department of State Directorate of Defense Trade Controls ( DDTC ) Regulation: International Traffic in Arms Regulations ( ITAR ) Controls Defense Articles, Services and Technology 7

8 Regulatory Controls Department of Commerce Bureau of Industry and Security ( BIS ) Regulation: Export Administration Regulations ( EAR ) Controls Dual Use items and items that have moved from the U.S. Munitions List ( USML ) to the Commerce Control List ( EAR ) Census Bureau Regulation: Foreign Trade Regulations ( FTR ) Collects, consolidates and disseminates export control statistics 8

9 Regulatory Controls Department of the Treasury Office of Foreign Assets Control ( OFAC ) Regulation: 31 CFR (Embargoes and Sanctions) Department of Homeland Security Customs and Border Protection ( CBP ) Regulation: 19 CFR Enforcement at the border; ACE / ACE Portal / AES *CFR Code of Federal Regulations 9

10 Regulatory Controls Other government agencies, for example: Nuclear Regulatory Agency ( NRC ) Drug Enforcement Agency ( DEA ) Alcohol, Tobacco, Firearms ( ATF ) Alcohol, Tobacco, Tax and Trade Bureau ( TTB ) Environmental Protection Agency ( EPA ) Fish and Wildlife Service ( FWS ) Agricultural Marketing ( AMS ) National Marine Fisheries Service( NMFS ) Note: You will hear more about PGAs - Participating Government Agencies during the conference. Please consider that several are moving from paper processes to reporting additional data elements in AES. DEA became effective August 1,

11 Communication is Key!! 11

12 Shipper Horror Stories 12

13 Shipper Horror Stories Cargo doesn t move Cargo moves to wrong destination Wrong party billed for freight charges Incorrect information reported to AES Causing cargo to be held by CBP Causing additional scrutiny by Government Agencies 13

14 Forwarder Horror Stories 14

15 Forwarder Horror Stories Shippers who refuse to provide information or AES filings on EXW transactions Shippers who are not educated on or even aware of export control requirements Complex / quirky documents Where s the ECCN 15

16 Shipper Challenges Quirky operating systems Sales not understanding compliance requirements Lack of expertise to do Statistical Classification (Schedule B / HTS) Lack of expertise to do Regulatory Classification / License Determination Communications issues between warehouse, business units, compliance, destination customers 16

17 Forwarder Challenges Volume of Transactions Wide variety of documentation finding information on documents Pressures to process files quickly Pressures to move cargo even though all information has not been received (pressure from shipper, the buyer or even management) 17

18 Forwarder Challenges Changes in personnel Inflexible systems (too rigid) Too flexible systems (lacking validations) Shippers who are not aware of or not well versed on export control requirements. You re the only forwarder who ever asks me for this information. 18

19 USPPI Responsibility Information Sheet 19

20 Clear & Specific Instructions 20

21 Clear & Specific Instructions Develop SOPs SHIPPERS Provide clear transactional instructions to the forwarder Tell you forwarder to contact you if they are missing anything Respond to forwarder requests Even if it s a Routed Export Transaction! 21

22 Clear & Specific Instructions FORWARDERS Review customer documents when you receive them Ask questions if there is anything missing or unclear Don t guess / don t assume 22

23 Confusing or incomplete information Incomplete, Confusing & Conflicting Information 23 23

24 Utilizing a Shipper s Letter of Instruction ( SLI ) 24

25 Multi-purpose Document Shipping Instructions Utilizing an SLI Electronic Export Information ( EEI ) filing information Authorization to file data into the Automated Export System ( AES ) Consistency information presented in a uniform way Includes all of the required fields (if you are using current versions) Better chance that the forwarder won t miss anything 25

26 Is an SLI required by the regulations? 26

27 Is an SLI required by the regulations? No the form itself is not required BUT it is a great means of providing complete and consistent information to the service provider. 27

28 Authorization Power of Attorney ( POA ) from a US Principal Party in Interest ( USPPI ) on a Standard Export Transaction or SLI for transaction by transaction authorization. Letter of Authorization from the Foreign Principal Party in Interest ( FPPI ) on a Routed Export Transaction, then the SLI is not needed for authorization. Even if the SLI is not needed for authorization, it is an effective tool for providing consistent and complete information. 28

29 Basic SLI Model Many forwarders are now using this model of the SLI, customizing it to meet their needs. 29

30 Shipping Instructions 30

31 SLI Model Explanatory Information 31

32 Parties to the Transaction 32

33 Required for certain types of transactions Coming Soon Tabs to provide / collect PGA data for filing in AES/ACE. 33

34 Commodity Information 34

35 Review and Recordkeeping 35

36 Review and Record Keeping Forwarders Second set of eyes review transactions Monitor and audit Shippers Review forwarder transactions Maintain records for 5 years from the date of export in most cases 36

37 ACE Reports 37 Proprietary Information - LACBFFA 37

38 ACE Reports 38

39 Shippers: Use an SLI if possible Recap and Q&A Shippers provide clear and complete instructions and filing data Communicate any special requirements Review shipping documents and EEI filings. Forwarders/AES filers do not assume information. Obtain information in writing. Forwarders Ask questions if information is incomplete, inconsistent or conflicting Monitor EEI filings data quality 39

40 Resources Publications and Resources Commercial Documents USPPI Responsibility Information Sheet nt&docid=13946&menukey=pubs Shipper s Letter of Instruction Model nt&docid=16032&menukey=pubs 40

41 Thank You Merit Tremper, LCB, CCS Merit Trade Consulting Services LLC Tel: Paulette Kolba, CES DSV Air & Sea Inc. Tel: