Revisiting routed transactions: 10 questions for industry

Have you ever struggled to determine the responsibilities and parties in a routed export transaction? If so, you’re not alone! Routed transactions make even the most experienced exporters pause. They have been described as dreaded, confusing, mysterious and complicated!

In an effort to give the trade community the chance to comment and provide feedback on “one of the most talked about subjects in the Foreign Trade Regulations,” the Census Bureau issued an advanced notice of proposed rulemaking on October 6, 2017. The topic is to address the requirements for routed export transactions. In particular, Census is looking for comments from industry regarding the definition of routed export transactions, as well as the responsibilities of parties in these transactions. As you may know, routed export transactions are when the Foreign Principal Party in Interest (FPPI) controls the movement of goods out of the country.

The Federal Register provides suggested questions for the industry to consider when providing feedback. These are:

  1. If you do not think the definition of a routed export transaction in 15 CFR 30.1 is clearly stated, then what definition of routed export transaction would you suggest?
  1. Should the Census Bureau modify the list of data elements at 15 CFR 30.3(e)(2) that the U.S. authorized agent is required to provide when filing the electronic export information? If so, what changes would you suggest?
  1. Should the Census Bureau modify the list of data elements at 15 CFR 30.3(e)(1) that the U.S. Principal Party in Interest (USPPI) is required to provide to the U.S. Authorized agent? If so, what changes would you suggest?
  1. The carrier's responsibilities under the FTR are the same in both standard and routed transactions. Does the FTR clearly communicate these responsibilities? If not, what clarification would you suggest?
  1. The data elements that the USPPI and U.S authorized agent are required to provide are currently located in Section 30.3(e) of the FTR. However, additional data elements are needed to complete the AES filing. Below is a list of data elements that are required to be reported but for which a responsible party is not listed. Please provide comments on which party, the USPPI or the U.S. authorized agent, should report these data elements.

  1. Are the responsibilities of parties in a routed export transaction clearly stated? If not, what improvements would you suggest?
  1. How could we improve the process to authorize filing in a routed export transaction?
  1. How could the FTR be revised to align with the Bureau of Industry and Security's (BIS) Export Administration Regulations (EAR) on routed export transactions?
  1. What changes would you suggest in Section 30.3 of the FTR that might improve the parties' understanding of the requirements of a routed export transaction?
  1. What changes would you suggest in Section 30.3 of the FTR that might improve the parties' understanding of their roles in a routed or standard export transaction?

Comments are due on this notice of proposed rulemaking by December 5, 2017.

If you are currently involved in routed export transactions, or thinking about trying these, please schedule a No-Charge Consultation with us. We would be happy to help you evaluate the process and comply.

Rebecca Yeager is a Trade Compliance Consultant for Export Solutions -- a full-service consulting firm that specializes in helping companies comply with U.S. and international import/export regulations.