The Obama administration set a goal in 2010 to make export compliance simpler by combining agencies and reducing the number of controlled items over the next several years. Currently, the US departments of the Treasury (Office of Foreign Assets Control), Commerce (Bureau of Industry and Security), State (Directorate of Defense Trade Controls), and Defense (Defense Technology Security Administration) all are involved in export controls and export licensing. This past month, a number of munitions list items have been moved to the Commodity Control List, which is managed by the Bureau of Industry and Security.

    Since it has been some time since I published an article reviewing export shipping basics, I thought it might be worth a quick overview of exporting from a small package perspective. Many companies today receive requests for their products over the Internet for quantities that are commonly shipped as small package or weighing less than 70 lbs each. When an international order is received, you should determine the following five basic elements:

    1) Is the commodity we sell a restricted export commodity?
    2) Is the order/request from a country that the US does not want to do business with?
    3) Are the persons or entity ordering the goods restricted from receiving goods from the US due to lack of past cooperation with US laws or similar issues?
    4) Is the product that you see restricted from importation into the destination country with permits, certificates of conformance, licensees or even specifically excluded from importation?
    5) Are the duties, taxes, and government fees prohibitive? What is the landed cost?

    Commodity restrictions: Many commodities are not restricted from export and can ship under general authorization as EAR99 No License Required. To confirm that your commodity is not restricted, you must review the Commodity Control List http://www.bis.doc.gov/policiesandregulations/ear/ccl_index.pdf.  

    Destination restrictions: Generally only humanitarian aid is allowed shipment to Iran, North Korea , Sudan, Syria, and Cuba.

    Person/end user restrictions: There are a number of restricted end user lists you should check prior to initiating an exportation: denied persons list, unspecified entity list, debarred list, specially designated national list, unverified list, entity list. You can find these lists at (http://www.bis.doc.gov/complianceandenforcement/liststocheck.htm)

    Destination Import restrictions: All three major US small package carriers offer website information on destination country import restrictions, such as import permits or certificates of conformance or goods that are not allowed importation at all. Restricted or prohibited items can be seized by the importing country so careful review of import restrictions and discussion with the consignee or an experienced customs broker is worth taking the time to do.

    Duties and Taxes: Finally, you should consider the harmonized classification of the merchandise and the relative duties and taxes that the consignee will have to pay when importing the goods. In many cases, you can find the tariff schedules and the relative duties and taxes online. For example, you can find the relevant import tariffs for Canada at the following website:
    http://www.cbsa-asfc.gc.ca/trade-commerce/tariff-tarif/2013/01-99/tblmod-02-eng.html

    Once you have answered the above questions and identified no restrictions, you can quote your Internet customer on the small package shipment rate, including the discounts and fuel surcharges and any accessorial fee that they may incur along with the duties and taxes to obtain the landed cost. In most countries, other than the US and Canada, the freight charges are part of the dutiable value of the merchandise being shipped and the taxable value includes the duties.

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