In the Chinese zodiac, 2023 is the Year of the Rabbit. The rabbit symbolizes many different attributes, including cautiousness and self-protection. During a recent gathering of trade compliance professionals, I heard someone mention that 2023 is “the year of export enforcement.” I must say that I agree. These two types of “years” seem to fit well together.
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It’s been a year since Russia launched its invasion of Ukraine. During that time, the Treasury Department’s Office of Foreign Assets Control (OFAC) has implemented sweeping sanctions, export controls and other measures against Russia. This includes adding more than 2,500 targets to the SDN List and sanctioning 80% of Russian banks.
Now, OFAC is targeting those who are trying to evade the sanctions.
“We don’t export anything.” This is something we hear all the time. Sometimes, our clients really don’t put something in a box and send it to a foreign country. Yet, they still need help. At first, you may think to yourself: “That’s weird. Why would a company that doesn’t export need a compliance program for exports?” However, there are certain scenarios when even those businesses that don’t “export” in the traditional sense still need to think about export control laws and regulations. Let’s look at a few.
Earlier this month, a 72-year-old Virginia man pleaded guilty to conspiring to violate Iranian sanctions. Behrouz Mokhtari of McLean, VA, is a naturalized U.S. citizen and a native of Tehran, Iran.
Trade compliance is a massive undertaking. Companies involved in exporting and importing goods have a lot on the line if they violate trade regulations.
According to the Bureau of Industry and Security, export fines can reach $1 million per violation for criminal cases and $250,000 or twice the value of the transaction for administrative cases, not to mention lengthy jail sentences for those found guilty.
So, your company must follow the guidelines, regulations, and laws set forth by various regulating agencies and maintain strict paperwork documenting the process.
It just got more expensive to violate U.S. import/export regulations. In recent weeks, the various governmental agencies who administer and enforce these regulations have released updated penalty amounts. The main culprit? Everyone’s favorite “I” word – inflation! The cost of non-compliance isn’t getting any cheaper. Now more than ever, companies must institute proper compliance programs, training and other measures to avoid these costly fines and penalties.
Whether you’re part of the Great Resignation, quietly quitting or just career cushioning, you may find yourself in the following scenario someday: It’s your first day on the job as the new Trade Compliance Manager for ABC, Inc. Where do you go? What should you do? Who should you see? Perhaps most importantly, how will you know if you’re hitting your milestones? Here are some helpful tips.
One of the questions we often hear is: "How do you stay current on the regulations?” Of course, there’s no single-source answer to this. To help you get started, we've created this list of 12 must-read blogs for trade compliance managers. Bookmark these and check back often. You’ll be glad you did!