As our Vice President Michael Bellezza spoke about on June 26th, the pace of change in trade compliance regulations and requirements has never been swifter than in the past five years.
The United States market is not unique in grappling with these regulatory challenges. However, the formality with which US Customs & Border Protection, the US Bureau of Industry and Security, and other relevant government agencies enforce regulations, combined with the market size and trade volumes most US-based customers must manage, make this a jurisdiction where strategy and forethought are especially key to ensure trade compliance departments meet their goals.
Well-run trade compliance programs designed to meet these goals have three main features:
Risk Assessment and Written Policies
Do what you say and say what you mean. Regulators expect importers and exporters to conduct periodic assessments of their risks in the trade compliance sphere and adjust accordingly. These self-assessment requirements are so encouraged that they’re codified into benefit programs like CTPAT. Programs are supported by policy statements, manuals, and desk-level procedures that guide company personnel on values and actions that must take place to preserve compliance levels.
Trade Data Determination
Beyond strategically reviewing regulatory changes and applying regulations at a macro level, companies need to invest in resources to ensure the data they transmit to authorities, either directly or via a customs broker, is determined accurately and documented. Data elements like HTS or ECCN classifications, PGA data elements, licensing requirements, valuation data points, and free trade agreement claims all impact the dutiability and admissibility of goods. When done wrong, these misdeclarations can create long-term risk for companies in the event of an audit.
Companies need to focus on (1) paying the right amount of duty, and (2) minimizing their duty spend compliantly whenever possible. Programs like Free Trade Agreements, FTA and Value Reconciliation, First Sale for Export, and Duty Drawback all help to minimize and recover duty payments to CBP and can help fund a company’s compliance program.
Here at Tradewin, we help companies build and manage their compliance programs across all these initiatives as a core competence. Our team supporting United States compliance requirements are all US-based and have the knowledge and experience to develop and support compliance program design and manage program execution. Reach out to us- we’re happy to help.