Official Highlights Concerns for Forwarders at NCBFAA Export Control Webinar
As export control reform continues, freight forwarders need to be thinking about employee training, monitoring, and systems controls to ensure compliance, said Paulette Kolba, chair of the National Customs Brokers and Freight Forwarders Association of America (NCBFAA) Transportation Subcommittee on Export Compliance. Kolba spoke in a webinar Oct. 4 on export control reform along with Bureau of Industry and Security Under Secretary Eric Hirschhorn.
Sign up for a free preview to unlock the rest of this article
If your job depends on informed compliance, you need International Trade Today. Delivered every business day and available any time online, only International Trade Today helps you stay current on the increasingly complex international trade regulatory environment.
BIS has a lot on its plate, and is continuing to push aggressively to complete export control reform, Hirschhorn said. “There’s still a heck of a lot to be done, but I’m thrilled with the progress we’ve made thus far and very optimistic about our ultimate success.”
Export control reform’s impact is going to be different for freight forwarders than it is for exporters, because forwarders are not classifying products, Kolba said. It’s very important for forwarders, however, to have a “high level understanding…about what our role is and what we need to recognize.”
Forwarders Should Take Special Note of New STA & 600 Series Requirements
Kolba was particularly concerned about the new Strategic Trade Authorization (STA) license exception, and said employees will need to be trained to recognize compliance requirements. Items shipped using the STA license exception require reporting, even for shipments valued at under $2500. The license exception is also only allowed for 36 countries, and in the case of 600 series items shipped using STA only for government end users in those 36 countries. “From a forwarding standpoint, we have to be very educated on the details of the reporting requirements, for instance the 36 countries for STA,” Kolba said. Forwarders need to program systems and train staff to recognize the 36 allowed countries.
Requirements for the proposed 600-series for items moving from the U.S. Munitions List (USML) to the Commerce Control List (CCL) will also change IT systems for forwarders and exporters, Kolba said. For example, 600 series items would as proposed require a special destination control statement that includes the item’s ECCN. But according to Kolba, many forwarders use a standard destination control statement that is automatically generated by the forwarder’s IT system onto a document. Forwarders may have to look closely at their systems and program a destination control statement that allows for the inclusion of an ECCN to meet the proposed requirements for 600 series items, she said.
And even though most forwarders are not involved in the classification process, they need to be aware of the changes in classification in the USML-CCL move, Kolba said. Forwarders will sometimes need to alert exporters, particularly those less educated in the changes, to their licensing requirements, she said. So it’s also important that forwarders “really understand these rules to at least recognize certain types of products,” and “to be able to guide our exporting customers to the appropriate government agency or the appropriate party that can help them determine whether or not their products need licenses or fall into these new categories,” Kolba said.
Exporters Should Alert Forwarders to New Reqs
Kolba also requested that exporters alert their forwarders to new export control requirements. “Although every forwarder will put training into place, many of the companies are very large with hundreds of staff and its always a good practice from the exporter standpoint to highlight anything that’s different,” she said. And exporters should review the documents received from their forwarders to ensure compliance, she said. “A forwarder will appreciate being advised of an error so they can take the necessary steps to correct and retrain."