TRAINING AND CREATING A COMPLIANCE STRATEGY
It takes close attention to correctly declare imports and exports and avoid
penalties. People in many roles within an organization must follow detailed,
centralized procedures and processes for imports, and perhaps pay even
greater attention to detail when exporting goods from the United States.
Key individuals who understand import and export requirements must direct
and coordinate these activities so the company can meet its obligations.
And, since import and export regulations continually change, it’s an ongoing
challenge to keep everyone’s knowledge of responsibilities current.
Acme hosted members of the C.H. Robinson’s trade policy team onsite at
the organization’s office. The team conducted multiple one–day training
seminars at several facilities. More than 250 employees from multiple
offices and various departments across the company attended. Sessions
covered general import and export regulations, Incoterms?, how to declare
the proper valuation of goods imported into the United?States, and which
federal agencies control U.S. exports. The training also explained deemed
exports, Harmonized Tariff classifications, antidumping laws, anti-boycott
laws, free trade agreements, and other complex concepts.
“The trade policy team included real life stories and examples from their
past roles and various industries, including ones similar to ours. Their
anecdotes made the subject interesting and kept everyone engaged,”
says Smith. “Our people became excited about compliance and more
aware of how they, too, play an important role in the greater import and
export compliance program. Compliance is an issue that goes beyond
transportation and supply chain. It belongs to all of us.”
Next, C.H.?Robinson conducted a comprehensive audit of Acme’s import
and export operations, policies, procedures, and overall compliance
program. The team interviewed Acme employees from all areas of the
business, examined current processes, evaluated critical documents, and
reviewed historical import and export records.
“They stress tested our compliance systems and capabilities. It was a
hard exercise for everyone, but so well worth it. Even beyond imports and
exports, we uncovered issues and discovered opportunities to save money
in the overall supply chain.”
At the same time, however, the audit revealed a number of serious violations
of federal regulations, including:
- Shipping to destinations without the proper authorization from the
U.S. government
- Incorrectly valuing their goods for U.S. import, as well as export
- Not claiming “assists” on imported merchandise
- Not screening business partners to verify they were not on the
denied parties lists
- Improperly classifying products in the Harmonized Tariff Schedule
- Lack of internal and external controls for import/export activities
- Lack of reasonable care or due diligence in their import/export
activities
- Lack of awareness that a previous broker had used their tax ID
number to clear goods for another company
If these errors remained uncorrected, Acme risked millions of dollars in fines
and penalties, potential loss of export privileges, and even possible jail time
for individuals at the company.
Acme worked with C.H.?Robinson’s trade policy team to correct these issues.
Smith acknowledges there was a lot of work involved. However, members
of the trade policy team had formerly worked in import/export positions
for private and publicly held companies. In addition, they were extremely
familiar with Acme’s order management and IT systems.
“C.H.?Robinson’s team sat down with us, helping us leverage our existing
systems to support the compliance activities. That saved us time and most
importantly, money,” Smith said. Fortunately, the issues uncovered by the
audit were caught, stopped, and corrected before any major damage was
done.