Export Compliance Program Management
Effective export compliance program management is important for a successful business. International trade is more prevalent than in any time in history. Failure to comply with export laws such as the Export Administration Regulations (EAR) and the International Traffic in Arms Regulations (ITAR) can lead to criminal penalties and imprisonment, civil penalties, and loss of ability to conduct export business.
Success Starts at the Top
As with any successful business undertaking, an effective export compliance program must start at the top. Management must be committed to strict adherence with export laws and regulations. This commitment should be documented in a statement that acts as a framework for the program. Management must also allot adequate resources to maintain and develop the program as the business evolves.
Establishment of Processes
Success cannot be left to chance. Effective and consistent compliance programs have documented processes for export control classification, license determination, and screening of potential customers. Appropriate procedures should also be set up in accordance with Part 762 of the EAR. Roles should be created with clear definitions of responsibilities for the execution of these processes. Because laws and regulations change and businesses evolve, a consistent review of processes utilizing risk management principles should be performed to continually mitigate potential shortcomings.
Education and Training
Processes cannot be effective unless personnel is educated of their importance. As an export violation can be the result of a phone call, email, or conversation, all parties should be cognizant of their responsibilities in maintaining export compliance. Regular education should be conducted to refresh this knowledge and train employees in changes in regulations and internal procedures. Understanding thousands of pages of Export Control Regulations and ITAR is challenging. Make sure your Export Compliance Training is engaging so that people actually learn.
Auditing Your Processes
To keep your Export Compliance Program Management system at its best regular reviews should be taken to assure it is working. These audits can monitor specific functional areas of a program or be at the corporate level. The U.S. Department of Commerce Bureau of Industry and Security (BIS) recommends that program level audits be conducted on an annual basis. It is a good practice to use outside auditors for these reviews for an unbiased evaluation and validation.
Have a Plan for Corrective Actions
Processes should be in place to detect any incident that may occur. It is important therefore to have procedures for internal and external reporting of potential noncompliance. Internal processes should be in place to investigate these potential incidents and disciplinary policies should be established. Employees should understand that is expected that they report these issues and that they will not be retaliated against for upholding the law.
Should noncompliance be confirmed, appropriate departments should be prepared to submit a Voluntary Self Disclosure and develop Corrective Actions to ensure that “lessons learned” will prevent such an event recurring.
CVG Strategy Can Help
CVG Strategy is a proven leader in ITAR and Export Compliance. Our specialists have managed manufacturing and distribution businesses and have worked for multi-national organizations. CVG Strategy’s experts are not ex-government employees, they are very familiar with the needs and goals of small to medium-sized operations. We also provide training and auditing services. Contact us to see how we can help you establish and maintain an effective Export Compliance Program.