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Maintaining False Hit Lists for Export Screening

False Hit Lists

Exporters, it’s that time of the year. It’s a good time to review those compliance practices you haven’t looked at in a few months. MGTA wants to provide you with some helpful tips to ease this year’s process. False hit lists, kept by exporters, entail the names of companies/people that are similar or identical to entries on government screening lists. Let’s take a look at how to make false hit lists more compliant.

The Office of Foreign Asset Controls (OFAC) issued a False Hit List Guidance Report. Since U.S. economic sanction programs are complex and ever changing, the report provides measures that are helpful in keeping false hit list entries fresh and compliant.

  • When there are implementations of new sanctions programs, false hit lists will be amended as needed.
  • For customers already on the false hit list, any changes that are made to the customer’s information—like a change in place of business, will trigger a review of a false hit list entry.

Read the full list of tips here. Contact us today for assistance with your export screening procedures.

By Lauren Felasco 

 

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3 Sources Needed for Your C-TPAT Country Risk Assessment

At MGTA the risk assessment for C-TPAT is part of what we do. C-TPAT extends supply chain security to facilitate safe trade from one business to another and from one country to another. As part of our C-TPAT certification package, we conduct a country threat assessment. To view what else our C-TPAT certification package includes, click here. This article will focus on how you can research the information needed to assess security threats to your international supply chain.

This evaluation, also known as a threat assessment, is necessary for C-TPAT partners because it allocates the risks associated with the country your business would be purchasing from. However, researching information on business prospect countries may be overwhelming. Where should you start? What information should you search for? How would you make sure the information you are receiving is legitimate? The following paragraphs offer three sources that are reputable enough to yield information that will help to perform a C-TPAT country threat assessment.

U.S. Department of State

DOS

 

The Department of State’s site provides “Trafficking in Persons Reports”, so that users can research troublesome areas in specific countries. For example, you could use the “Country Narratives” [PDF] section to research the status of human trafficking in China. It is noteworthy to understand the State Department, along with other reputable sources, may be unable to provide more recent information due to political instability within certain countries.

The United Nations Office on Drugs and Crime (UNODC)

UNODC provides information on the global issues of illicit drugs, crime, and terrorism. The UNODC website design, domain, and credentials have historically proven to be reliable since 1997. Imagine, once again, you are researching the risk factor of human rights compliance in China. UNODC provides reports on human trafficking specific to countries. The site displays the information on China through pie charts and other graphs.

UNODC CTPAT risk

For example, the pie chart above illustrates statistics about Chinese victims of human trafficking as reported by Thai authorities.

Reuters

As one of the world’s largest international multimedia news agencies, Reuters is an excellent source for country specific information related to many topics, including human rights compliance.

Reuters CTPAT risk

A search for “human rights compliance and China” returns 272 results. The most recent result was posted just five days before the search.

MGTA’s commitment: Your assessment is safe with us

Experts at MGTA have the knowledge needed to perform a thorough country risk assessment as part of our professional C-TPAT certification package. MGTA reviews human rights compliance and all other threat factors according to guidelines established by CBP for country risk assessments.

To learn more about the guidelines MGTA follows to perform country risk assessments, click here or contact us today.

By Lauren Felasco  

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How to Spot Boycott Language

U.S. exporters stop boycott language

U.S. exporters, do you know what type of boycott language to look out for in your letters of credit, invitations to bid, or purchase orders involving foreign buyers?

U.S. law discourages, and in some cases directly prohibits, U.S. businesses/companies from participating in any type of a business boycott. In order to comply with the law, U.S. exporters need to be aware of the ways in which a foreign company might indicate boycott practices. The language of the documents needs to be examined closely for indications of a boycott, which may be very subtle.

Examples of boycott language might look like this:

  • “In the case of overseas suppliers, this order is placed subject to the suppliers being not on the Israel boycott list published by the central Arab League.”
  • “Goods of Israeli origin not acceptable.”
  • “A signed statement from the shipping company, or its agent, stating the name, flag and nationality of the carrying vessel and confirming … that it is permitted to enter Arab ports.”
  • “Certificate issued by the shipping company or its agent testifying that the carrying vessel is allowed to enter the Lebanese port…”
  • “All goods to be supplied as a part of this order must comply with the Israel boycott rules stipulated by the Royal Oman Police.”
  • “Certificate from insurance company stating that they are not blacklisted.”
  • “Quotation should not include items manufactured by firms who are under Israeli Boycott list.”

On the Lookout

U.S. exporters, if this type of language is discovered in business contracts or other documents for a proposed transaction, do not continue to do business with the foreign buyer. As a U.S. exporter, the transaction with the foreign buyer should not be taken any further. Remember exporting is a privilege that can be taken away by the U.S. government!

Antiboycott Screening

In Part 760 of the Export Administration Regulations (EAR), there is a requirement that you review your letters of credit, invitations to bid, purchase orders, contracts, etc. for foreign boycott requests. EAR encourages American companies not to support the foreign policies of nations that are counter to that of the United States. American companies must comply with the laws of the U.S to continue to export and complete transactions.

While reviewing for foreign boycott requests, it is important to check for antiboycott language. For more information about antiboycott compliance, visit www.bis.doc.gov.

By Lauren Felasco 

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Check Your Supplier’s Work Before You Make that NAFTA Claim

U.S. importer reviewing NAFTA certificate of origin with their supplier.

Attention U.S. importers: is your supplier providing you with inaccurate NAFTA certificates? Would you be able to tell if they were? Not being careful when it comes to double-checking your certificates of origin can potentially force you to dish out money for penalties. By understanding NAFTA’s requirements and asking your supplier the right questions, you can prevent unnecessary spending.

One common error for NAFTA certificates of origin is wrong preference criterion (field #7). NAFTA has six different preference criteria, identified by the letters A-F, which define how goods qualify for preferential tariff treatment. For example, preference criterion B is only applicable when goods have been made entirely in a NAFTA country and the rules of origin have been satisfied.

Asking how your supplier qualified the goods for NAFTA is an imperative, precautionary step. You need to make sure your supplier has the necessary backup documentation to support the qualification. What counts as backup documentation?

  • supplier’s NAFTA certificate for purchased parts that go into the product listed on the importer’s NAFTA certificate
  • a costed bill of materials from when NAFTA was declared
  • written documentation of the supplier’s method for determining how the goods qualified for NAFTA

You should not be relying on the supplier’s certificate as the sole proof that your product qualifies. When reviewing certificates of origin, these cautious steps are ones that can save you from repaying back duties, interest, and fines in the event of a Customs audit.

Experts at MGTA are able to help clarify NAFTA products from non-NAFTA products. Contact us today to learn more about item qualification and certificates of origin.

By Lauren Felasco 

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Highlights from Trade Day

Mohawk Global Trade Advisors (MGTA) sincerely thanks all the attendees, speakers, sponsors, and staff who helped make this year’s International Trade Day at Casa Larga Winery in Rochester, NY an absolute success.

Grapes on the vine

Lush greenery from the surrounding vineyards.

Casa Larga wine barrels.

Signature Casa Larga wine barrels.

Our speakers shared insights into everything from deciphering Mexican Customs issues, finding help on the ACE Portal, and saving with duty drawback, to understanding how engineers are crucial for export compliance, dealing with mixed ITAR and EAR shipments, and minimizing the impact of potential export violations.

Daniel B. Hastings, III at podium

Daniel B. Hastings, III of Daniel B. Hastings Inc. (at podium) captivates the crowd with a rare look at Mexico’s clearance process.

A special thank you goes out to all Trade Day speakers. You were the stars of the show! Thank you to Anne Jordanek of Deringer Logistics Consulting Group; Bill Kaufman and Peter Russell of U.S. Customs & Border Protection; Jodi Earle of Crosman Corporation; Daniel B. Hastings III and David Hastings of Daniel B. Hastings Inc.; Jim Dusel of Laub International; Jon Yormick of Phillips Lytle; Mike Frail of Pulsafeeder; Mary Slack of Spectracom; and Jim Trubits, Robert Stein, Gar Grannell, and Sue Nans of MGTA.

Peter Russell of CBP presenting during MGTA Trade Day

Peter Russell of U.S. Customs & Border Protection (center) gives the inside scoop on recent changes to ACE.

Robert Stein (MGTA), Anne Jordanek (Deringer Logistics Consulting Group), Jodi Earle (Crosman Corporation), and Jim Dusel (Laub International Inc.)

Our expert panel gets pumped for their upcoming discussion of duty savings programs. From left to right, Robert Stein (MGTA), Anne Jordanek (Deringer Logistics Consulting Group), Jodi Earle (Crosman Corporation), and Jim Dusel (Laub International Inc.).

Peter Russell of U.S. Customs & Border Protection talks to Wayne Slossberg of QuestaWeb

Peter Russell (left) of U.S. Customs & Border Protection talks one-on-one with Wayne Slossberg (right) of QuestaWeb during a refreshment break.

Trade Day would not have been possible without the generosity of our sponsors. MGTA thanks Arrow Transportation, represented by Chris Dewey; Avalon Risk Management, represented by Kathy Schricker; Roanoke Insurance Group, represented by Amanda Barlow; Laub International, represented by Jim Dusel; and Phillips Lytle, represented by Jon Yormick; for sponsoring the wonderful gourmet lunch served during the event. We also thank Descartes, represented by Tom Kuerbs; and QuestaWeb, represented by Wayne Slossberg; for the beautiful wine reception we had at the close of the event.

Amanda Barlow of Roanoke Trade with Dean Maciuba of 4Front Consulting Group

Amanda Barlow of Roanoke Trade (left) shares the finer points of ATA carnets with Dean Maciuba of 4Front Consulting Group (right).

MGTA also acknowledges all of the internal staff members who worked behind the scenes on Trade Day. We appreciate all of your hard work and support. Thank you Ross Twaits, Abby Frank, Bev Seif, Cindi Kavanaugh, Diane Cima, and Michelle (Sardella) Kelley.

Luis Esqueda Payan (Boutique Legal Internacional), Jon Yormick (Phylips Lytle LLP), Enrique Acosta Saenz (Boutique Legal Internacional), and Gar Grannell (MGTA)

Clockwise from bottom left: Luis Esqueda Payan (Boutique Legal Internacional), Jon Yormick (Phillips Lytle LLP), Enrique Acosta Saenz (Boutique Legal Internacional), and Gar Grannell (MGTA) talk shop at the evening wine reception.

We hope to see everyone next year at the second annual International Trade Day. Until then, keep your compliance manuals fresh and your wine properly chilled!

By Michelle (Sardella) Kelley

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Use HR to Help Prevent Export Violations Involving Foreign Nationals

An anonymous figure overlays technical drawings

Is your human resources department asking job candidates the right questions when it comes to citizenship or immigration status?

In order for your company to protect information about ITAR or EAR controlled products, that is to remain private, your HR department needs to confirm each applicant’s citizenship status.

The problem arises when employees are committing export violations unknowingly. Disclosing details about controlled exports to foreign nationals, without proper licensing to do so, is considered an export violation by the U.S. government. Technical details, designs, and software are all examples of export controlled items.

How can we prevent these violations?

Violations exist because company information that is intended to remain enclosed within the company can be spread outside of the workplace for the wrong reasons. Other persons, companies, or services could use this leaked information in harmful ways. Through knowledge and communication, export violations and other restrictions can be prevented; through knowing which staff members are foreign nationals and knowing which type of information needs to remain confidential, HR and staff members can work together to prevent violations from occurring.

There is a high priority need for HR to alert a company’s empowered official, the top person responsible for the company’s export compliance policies and procedures, whenever any foreign national is hired. However, since U.S. law also prohibits employers from discriminating against job candidates based on their citizenship status, HR may find it necessary to consult with an attorney before making any changes to the hiring process. It should be noted that this an area where employment law overlaps with export compliance regulations. Navigating through the requirements while staying within the confines of the law is no simple task. Companies should seek guidance from a legal expert, such as a trusted attorney, under these circumstances.

Understanding and following regulations on export control can be complicated. When it comes to your company’s export controlled products or services, MGTA’s consultants can provide professional export process review and gap analysis to help with keeping confidential information safe.

Be prepared and procedure ready

Is your staff properly trained on the necessary precautions? Contact us today to learn more about our export process reviews and onsite training.

By Lauren Felasco 

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Explore the Possibilities with Our FTZ Savings Calculator

Business woman contemplating

Regardless of industry, most business decisions can be boiled down to a few essential considerations. Is it worth it? What do we have to gain?

Likewise, these questions should be some of the first to ponder when a company is looking into operating in a Foreign Trade Zone (FTZ). Many companies become interested in pursuing an FTZ because of the potential for duty and other savings opportunities.

Our FTZ Savings Calculator can help you estimate your company’s potential savings from operating within an FTZ. Simply provide your

  • total number of Customs entries filed annually
  • annual value of imports
  • annual duties paid
  • average ad valorem duty rate on finished products
  • average broker fee per entry
  • annual value of re-exports
  • percentage of scrapped imported merchandise
  • interest rate

With this data, the calculator will estimate your potential duty savings (from deferred, reduced, and eliminated duties) as well as possible savings that could be yielded from using an FTZ weekly entry procedure. You can then use the results to gauge whether or not its worth your while to further pursue an FTZ for your company.

Download FTZ Savings Calculator (PDF)

Is your company considering an FTZ? MGTA can help you with FTZ cost/benefit analysis, feasibility studies, FTZ setup/activation, and more. Learn more about our FTZ services or contact us today for a free quote.

Disclaimer: Additional savings opportunities may be available. Other factors not captured within this calculator may affect potential savings (e.g. use of special trade programs, industry activity, etc.). Calculations do not include time quantification of direct delivery savings of expediting merchandise movements, production equipment savings, inventory growth, handling of quota/visa merchandise, or NAFTA transactions.

By Michelle Sardella

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The Benefits Exporters Have Been Waiting For: C-TPAT Export Entity Update

C-TPAT update

As a follow up to last month’s article, U.S. Customs and Border Protection (CBP) has announced that C-TPAT benefits have been extended to exporters that ship to Canada, the EU, and Japan. Eventually, CBP plans to have the same benefits available for exports to all countries that have a mutual recognition arrangement (MRA) with the U.S.

In the works

The current status of applicants is a total of nine export-only companies, however not one has been certified as an exporter entity yet. CBP is working with MRA partners in obtaining similar export benefits for current C-TPAT importers that also export to the following countries: New Zealand, Jordan, Singapore, Mexico, Taiwan, Israel, and South Korea.

Apply to become a part of C-TPAT now

MGTA provides consulting to help companies become C-TPAT certified. Contact us for more information about our C-TPAT services.

By Lauren Felasco 

 

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Sue K. Nans and Cindi Kavanaugh Join MGTA

Mohawk Global Trade Advisors (MGTA) is excited to introduce two of its newest Senior Trade Advisors.

Sue K. NansSue K. Nans joins MGTA as a Senior Trade Advisor after being an Empowered Official in the manufacturing industry.

For over 15 years, Sue mentored and trained employees at Anaren, Saab Sensis, M. S. Kennedy and all new export control employees at Lockheed Martin. She spent several years as a Personal Consultant assisting local companies through voluntary disclosures, auditing export programs, and formulating new compliant processes. Sue has degrees from Dunlap-Stone University and Columbia College.

Read more about Sue K. Nans here.

Cindi KavanaughCindi Kavanaugh joins MGTA as a Senior Trade Advisor. Cindi is a licensed Customs broker, certified Customs specialist, and certified classification specialist. She has previously worked for a Fortune 500 firm for almost 11 years as a Trade Compliance Manager. Her expertise includes qualifying products for free trade agreements and drawback processing.

Read more about Cindi Kavanaugh here.

By Lauren Felasco 

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The Time Is Now: C-TPAT Open to U.S. Exporters

Secure container yard with worker

Exporters can now apply for C-TPAT membership, as announced by U.S. Customs and Border Protection (CBP) earlier this month. Although there is no cost to participate, exporters must first complete a lengthy application and certification process before they can reap the benefits of the program.

Why join C-TPAT?

The benefits include, but are not limited to:

  • Prioritized export shipments
  • Global security partnerships
  • Heightened facilitation from mutually recognized customs partners
  • Access to C-TPAT sponsored security seminars
  • Reduced examinations

To learn more about the benefits of joining C-TPAT, check out the C-TPAT Exporter Entity Factsheet provided by CBP.

Take steps toward C-TPAT certification with MGTA. Mohawk can prepare and help you with your:

  • Supply Chain Risk Assessment
  • Country Risk Assessment
  • Cargo Flow Table
  • Security Profile
  • C-TPAT Standard Operating Procedures (SOP) Template
  • C-TPAT Training

For more information about C-TPAT and to access the application, click here.

Ready to become a part of C-TPAT?

Don’t lose business opportunities because your company isn’t C-TPAT certified. Get your company C-TPAT ready today with MGTA. Click here to learn more about our C-TPAT services or contact us to speak with one of our C-TPAT experts.

By Lauren Felasco

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Is that a Legitimate Export Customer or an Illegal Front Company?

St. Basil's Cathedral

The U.S. government remains concerned about efforts by front companies and other intermediaries, who are not the true final end users, to transship or reexport U.S.-origin items to the Russian Federation in violation of current export controls.

To prevent unauthorized reexports to Russia, especially for transactions involving nationally security-controlled items or items listed in Supplement No. 2 to Part 744 of the EAR, the Bureau of Industry and Security has published additional guidance for U.S. exporters.

Here are a few preventative measures you can take to minimize the chances of unknowingly enabling illegal diversion of your exported goods to Russia. You can read the full version here.

  • Pay attention to discrepancies between the destination country and the country from which an order is placed (or the country from which payment is made). If the countries do not match, it’s possible that someone is planning to illegal divert your exported goods to a different country, such as Russia.
  • If a freight forwarder’s office/address is listed as the export’s final destination, you are required by law to investigate the situation further. Do not proceed with the transaction or even think about shipping out the goods before asking the purchaser about the item’s end user, end use, and ultimate destination.
  • Before shipping the item, go through the emails you’ve previously received from the customer, taking note of any mention of other email addresses or telephone number country codes. Do any of these details suggest a destination country other than what you’ve been told by the customer? If so, you should be wary of going through with the transaction.
  • Always check that your customer is not listed on the U.S. government’s consolidated export screening list. You can also use the International Trade Administration’s new online tool to search the list by entity name or address.

Russia Due Diligence Guidance (Bureau of Industry & Security)

By Michelle Kelley

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Think ACE Is Irrelevant? Think Again.

ACE secure data portal

If you think U.S. Customs & Border Protection will never implement the Automated Commercial Environment (ACE), think again. It appears Customs is charging ahead with its plan to fully launch ACE, according to an interim rule included in the Treasury Department’s spring regulatory agenda.

The rule requires all entry/entry summary information to be filed electronically in ACE starting November 1, 2015. In effect, you would no longer be allowed to file this data in the Automated Commercial System (ACS).

Following the change on November 1, U.S. Customs plans to institute the remaining portions of the cargo process in ACE on October 1 of next year. To read more about ACE mandatory use dates, click here.

Since these major transition dates are not far away, it’s imperative that members of the trade community, especially U.S. importers and exporters, familiarize themselves with ACE as soon as possible.

Learn how to use ACE during our 6/24 webinar, Acing Your Import Compliance. We’ll show you how to use ACE for classification, valuation, reporting, and more. Click here to register and for more information.

By Michelle Sardella

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Get a Year’s Worth of AES Filing Records for Free

Business man at desk in office

U.S. exporters can request 12 months of AES filing records from the Census Bureau for free every year.

Submitting the request is easy and recommended for companies that rely on a freight forwarder to file their Electronic Export Information (EEI) in AES.

By obtaining these records directly from Census, exporters have the advantage of seeing exactly what Census sees, including inaccuracies.

Our guide will walk you through it step-by-step. Download it here..

Interested in learning more about taking control of your AES compliance? Consider attending one of our AES Best Practices seminars this May in Upstate New York. Click the dates below for more details.

AES Best Practices

5/12 Albany, NY »

5/13 Syracuse, NY »

5/14 Rochester, NY »

5/19 Buffalo, NY »

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Writing a Website Disclosure that Complies with the California Transparency in Supply Chains Act

Boy behind bars

The California Attorney General has released a new resource guide that aims to help companies comply with the California Transparency in Supply Chains Act.

Enacted in 2010, the Act requires large retailers and manufacturers doing business in California to disclose on their websites their efforts to stop human trafficking and slavery within their supply chains. The law applies to companies with annual worldwide gross receipts totaling more than $100 million and that identify themselves on a California tax return as a retail seller or manufacturer.

The Resource Guide explains the Act’s requirements, what should be included in website disclosures, and how the information should be formatted. Example statements are provided for each of the five mandatory disclosure categories

  • verification
  • audits
  • certification
  • internal accountability
  • training

There are also examples of how NOT to write a proper disclosure, such as this:

As a part of our extensive vetting process, we require each vendor to adhere to our Code of Conduct. Additionally, our unannounced, third-party audits provide current data on sourcing factories’ working conditions, including our company’s standards for trafficking and slavery in supply chains, compliance with local and international labor laws, and management policies. The audits are conducted quarterly. Further, we provide company employees and management who have direct responsibility for supply chain management training on human trafficking and slavery.

Most companies would see nothing wrong with using the above disclosure on their website. Yet, according to the Resource Guide, this disclosure is insufficient for a number of reasons. For instance, only two of the five mandatory categories are covered; there is nothing about the company’s verification, certification, or internal accountability practices. Also, although training is mentioned, there is no explanation as to the extent of their training activities.

Learn how to avoid these types of mistakes with The California Transparency in Supply Chains Act: A Resource Guide. It’s worth a read even if the law doesn’t apply to your business. There is increasing demand among many consumers (not just those in California) for this type of information. According to the Resource Guide, “a recent survey of western consumers revealed that people would be willing to pay extra for products they could identify as being made under good working conditions.”

The California Transparency in Supply Chains Act: A Resource Guide

 

By Michelle Kelley

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Seal Procedures for Every Link in Your Supply Chain

CBP officer inspects container with seal.

U.S. Customs & Border Protection (CBP) recently released a draft guide for container seal best practices, outlining recommended procedures for different links and activities within the supply chain.

The guide includes procedures for

  • U.S. importers
  • exporters
  • manufacturers
  • consolidators
  • cross border highway carriers
  • domestic highway carriers (in the U.S. and abroad)

Despite the fact that CBP has labeled this a “draft” version, the guide is surprisingly thorough, covering procedures from the point of sealing, to the point of receipt.

Click here to download the guide.

 

By Michelle Sardella

 

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Exporter Boycott Checklist

The Export Administration Regulations (EAR) require companies to report any boycott requests they receive on a quarterly basis. Not sure what’s considered a “boycott request”? Here are five example questions you could include in your process to check for any such requests.

  • Do I know of agreements to refuse or actual refusals to do business with Israel or with blacklisted companies?
  • Do I know of agreements to discriminate or actual discrimination against other persons based on race, religion, sex, national origin or nationality?
  • Am I aware of requests for furnishing information about business relationships with Israel or with blacklisted companies?
  • Am I aware of requests for furnishing information about the race, religion, sex, or national origin of another person?
  • Do I know of requests for paying, or otherwise implementing letters of credit that include requirements to take boycott related actions prohibited by the antiboycott regulations?

For more recent examples of boycott requests that have been reported to the Office of Antiboycott Compliance, click here.

This checklist is just one example of the information we provide to attendees during our Export Control Basics seminar. Increase your export compliance know-how and receive a packet of useful forms, guides, and other resources by attending one of our seminars this March or April.

Export Control Basics
$50, 1.5 CES Credits

3/11 Rochester, NY

3/12 Buffalo, NY

3/24 Cleveland, OH

4/22 Albany, NY

4/23 Syracuse, NY

 

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CBP Announces US-Singapore Mutual Recognition and Customs Mutual Assistance Agreements

Customs' Secure Trade Partnership Signing Agreement with Signapore

CBP Commissioner R. Gil Kerlikowske and Singapore Customs Director General Ho Chee Pong sign a U.S.– Singapore CMAA and MRA between CBP and Singapore’s Customs’ Secure Trade Partnership.
(Photo by: U.S. Department of State)

Customs and Border Protection (CBP) recently announced the signing of a mutual recognition agreement and a Customs Mutual Assistance Agreement (CMAA) between Singapore and the United States, effective as of December 1, 2014.

A mutual recognition agreement between the United States’ C-TPAT program and another country’s customs program—in this case Singapore’s Secure Trade Partnership (STC)—certifies that the foreign customs program’s requirements, regulations, and security standards are similar to those of C-TPAT, and produces benefits for companies operating in the mutually recognized countries.

A Customs Mutual Assistance Agreement establishes and facilities increased information-sharing between the two countries, allowing partners in the CMAA to more easily and effectively enforce their customs laws.

The institution of a mutual recognition agreement, as well as a CMAA between the U.S. and Singapore allows the processes pertaining to importing and exporting between the two countries to become more simplified, while also enabling both countries to better regulate their customs processes, respectively.

Additionally, mutual recognition agreements and CMAAs result in their own set of benefits. Partners in mutual recognition agreements enjoy the following benefits as a result of each country acknowledging the similarities between its own customs program and that of its partner country:

  • Faster validation process
  • Fewer exams on cargo
  • Common security standards
  • Higher level of customs efficiency
  • Front-of-the-line processing
  • Marketability

At the same time, partners in a CMAA are better able to protect themselves from the negatives associated with trade, such as terrorism-related events/activities, trafficking, money-laundering, duty evasion, and proliferation because of the increased communication between partner countries that a CMAA establishes.

The U.S. also has mutual recognition agreements with the following Supply Chain Security programs: New Zealand, Canada, Japan, Korea, Jordan, the European Union, Taiwan, Israel, and Mexico.

Source: U.S. Customs & Border Protection

By Abby Frank, Consulting Coordinator

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