Import/Export Team Lead – Timothy E. Allen | Former Special Agent (U.S. Secret Service & DOJ-OIG)
Corporations that import or export goods have extensive compliance obligations to meet. Worse, those obligations change frequently, requiring constant updates to company policies and daily vigilance for new changes. Making a mistake and violating U.S. or international law can be costly, both in terms of financial penalties as well as a blemish on the company’s brand and reputation.
Devising and implementing adequate import and export policies can be difficult, and the policies will be unique for each company’s needs. The import/export consultants at Corporate Investigation Consulting have extensive experience in the field. Many companies, both those based in the U.S. and those abroad, have tapped into our well of knowledge by hiring us to consult them on how to best comply with these complex legal requirements and obligations.
The Many Factors at Play in Import and Export Controls
There are so many different factors at play when it comes to import and export laws that it can truly be said that every company that does international business has unique needs to meet.
The country at the other end of the exchange makes a huge difference in the laws that can apply to the transaction. The country of origin or destination will have its own set of import/export laws and regulations that need to be followed. There will be taxes to pay and potentially even tariffs, as well. Depending on the country, there may also be U.S. sanctions to comply with and there will always be customs to go through.
The value of the goods will determine the compliance obligations that need to be met. The goods will likely be taxed by at least one country, and it is in your company’s best interests to monitor the pricing of the goods and the costs of shipping them to ensure that you are getting the best deal.
How much you are importing or exporting also matters. At the very least, you will have to accurately record the amount of your imported or exported goods to satisfy U.S. compliance responsibilities.
Put our highly experienced team on your side
Roger Bach
Former Special Agent (OIG)
Timothy E. Allen
Former Senior Special Agent U.S. Secret Service
Chris J. Quick
Former Special Agent (FBI & IRS-CI)
Maura Kelley
Former Special Agent (FBI)
Ray Yuen
Former Supervisory Special Agent (FBI)
Michael S. Koslow
Former Supervisory Special Agent (DOD-OIG)
Marquis D. Pickett
Special Agent U.S. Secret Service (ret.)
What goods you are exporting or importing, though, is likely the most important factor that will determine your compliance needs. The nature of the goods can trigger:
- U.S. sanctions
- Tariffs
- A host of other regulation requirements from other federal agencies
For example, if your company imports vegetables then you can count on the U.S. Food and Drug Administration (FDA) having regulations for you to follow and red tape to deal with. Companies that export weapons, meanwhile, will be subjected to extensive arms export controls.
Import/Export Law Changes Frequently
To make matters worse, import/export law changes constantly and is among the more political fields of law on the books. Predicting which way the political winds will blow, and then reacting to them when they change directions, is something that all multinational businesses will have to deal with.
U.S. sanctions law, as enforced by the Office of Foreign Assets Control (OFAC) at the Department of the Treasury, is perhaps the most egregious offender on this front. These sanctions lists can get updated multiple times per week, and companies are expected to not just avoid doing business with those on the blocked lists, but also to stop doing business with them if they already are.
Particularly for international companies that have thousands upon thousands of clients, like banks, this compliance obligation can be massive. Worse, the costs of violating sanctions are substantial.
The High Costs of Violating International Import/Export Law
With all of the legal obligations that come from importing or exporting goods and with how frequently they shift, it can be difficult to stay in compliance with them. Unfortunately, the costs of noncompliance can be severe.
While the exact penalties that a company that is out of compliance with import or export laws can face will vary on the nature and the significance of that noncompliance, the monetary fines are just the beginning. A finding of noncompliance frequently triggers a further investigation. If that investigation uncovers other issues, the legal jeopardy that the company faces will grow. Furthermore, if news of the violation gets out, the company could find its reputation harmed and its brand for good business tarnished. This can cost the company far more in lost business than the financial sanctions that were imposed.
The Services that Corporate Investigation Consulting Provides
With so much at stake, it should come as no surprise that many companies that do business abroad hire consultants to help them craft effective import/export compliance mechanisms. By tapping into experts in the field, these companies gain the insight that they need to insulate themselves from the extensive liabilities that stem from noncompliance.
The compliance professionals at Corporate Investigation Consulting provide a whole suite of services for companies looking for import/export consultants. Just a few of the most important are:
- Creating import/export policies – By standardizing how your company goes about exporting or importing goods, you can drastically reduce the odds of noncompliance
- Employee compliance training – Training and retraining employees in their compliance duties is one of the best ways to ensure that they are aware of their obligations and that they follow through on them
- Import/export policy auditing – Conducting an audit is the best way to make sure that your policies are actually being followed and that they are actually effective before they show their inadequacy by failing and exposing the company to liability
- Updating import/export policies – Whether because import/export law has changed or because an audit has found an aspect of the policy lacking, you company’s import/export protocols need constant maintenance; they are not a “fix it and forget it” process
These are just the major building blocks of a robust compliance regimen that can protect your company from the serious consequences of violating U.S. or foreign import/export laws.
Frequently Asked Questions About Corporate Investigation Consulting and Import/Export Law
What if I Import or Export Through an Import Broker?
Many companies that do international business rely on a broker to handle their importing. While brokers are professionals in their field and their familiarity with the industry makes them far more knowledgeable than many others, in the end it is the company that is ultimately responsible for what it ships into the country.
Therefore, if you use an import broker, you benefit from their more intimate understanding of the needs and obligations of the field and the reduced likelihood that they make a mistake, due to their experience. However, you are not shielded from liability if your import broker makes a mistake.
Should I Self-Report a Customs Violation?
If your company imports goods and it gets discovered that there would be a customs violation, it may be in your best interests to voluntarily report it. This is particularly true for minor violations that are caught early in the process. However, even major violations may be in your company’s best interests to voluntarily disclose to customs officials if it seems likely that they would be detected anyway, as doing so could alleviate some of the worst penalties that could be assessed.
These are sensitive matters, though, and should be addressed on a case-by-case basis. By conducting regular audits, your company can find any goods that got through but that should not have, allowing stakeholders and decision-makers the time they need to figure out how to respond. The audit can also uncover what internal policy failure led to the error so that it can be fixed.
Why Should I Hire Corporate Investigation Consulting as Import/Export Consultants?
The compliance professionals that staff Corporate Investigation Consulting have extensive experience, including many professionals with long investigatory backgrounds in some of the most powerful federal agencies in the world, like the Department of Justice, OFAC, and Customs and Border Protection. That prior experience sets us apart as compliance consultants. We understand what federal agents are looking for when they conduct their investigation because we are former federal agents who used to do those very investigations.
Is All the Compliance Really Necessary?
Many business owners look at the costs of import/export compliance and at their bottom line and decide to continue to do what they are doing and hope for the best. In some less risky industries, this might work and save the company some money. In many others, though, it can be just a matter of time before import/export law is violated. When it is, the repercussions of the violation – even if it was just one – can eclipse the costs that the company would have spent on compliance.
Contact Corporate Investigation Consulting
If your company exports or imports goods regularly, then having strict compliance programs in place is absolutely essential if you want to avoid what could become massive consequences of noncompliance. If your company rarely does any exporting or importing, that lack of international business actually makes it even more important to get an import/export consultant on hand to make sure you are doing things correctly, or if your company’s old policies are still sufficient and adequate.
Contact Corporate Investigation Consulting online or call their office at (866) 352-9324.