New book offers assistance to small companies involved in international trade

In July 1999, a New York company was fined $900,000 by the U.S. Department of Commerce and denied its export privileges for one year for failing to properly follow U.S. export regulations.  And they were not alone.  Every year, the U.S. government sanctions dozens of companies for similar violations.

At a time when companies with less than 500 employees represent 97 percent of the growth in exporting, these companies and their employees don't fully understand the U.S. rules and laws that regulate every aspect of an international transaction.  This ignorance can result in unanticipated liabilities and expenses, fines, loss of export privileges, and even imprisonment.

Help is now available.  In International Small Business Logistics, Catherine J. Petersen and George W. Thompson have compiled their extensive international trade knowledge in a comprehensive reference book that teaches small and mid-size companies and their employees about international logistics.

International Small Business Logistics is an easy-to-understand guide to international transportation and the practical application of common rules and documentation.  This 350-page book features chapters on managing transportation costs, properly packaging shipments, selecting and working with freight forwarders, using proper international trade terms (INCOTERMS 2000), understanding insurance options, and reviewing payment options.

The book's authors have more than 40 years combined experience in international trade.  Petersen has worked as a freight forwarder and ocean carrier representative and now travels the country training export company personnel.  Thompson is a partner in the Washington, D.C., office of the law firm Neville, Peterson & Williams specializing in import and export regulations and transactions.

The $99 book is published by International Business Training (IBT) and is available by calling 1-800-641-0920 or by visiting the IBT web page at www.i-b-t.net.

Companies that export from the United States now have less than 30 days to begin using the new Shipper's Export Declaration (SED) that was introduced by the U.S. Census Bureau last fall.

The redesigned SED is just one of the changes that will take affect April 1, 2001, under new U.S. Census Bureau and Bureau of Export Administration rules.

Among the changes on the SED, these new rules re-label box 1A from "Exporter" to "U.S. Principal Party in Interest." According to the new regulations, the U.S. Principal Party in Interest is the person in the United States that receives the primary benefit—monetary or otherwise—of the transaction. Generally the person is the U.S. seller, manufacturer, order party or foreign entity if in the U.S. when the items were obtained for export. Rarely would a freight forwarder be listed as the Principal Party unless they were also the order party.

The new regulations also make a distinction between the Principal Party and the exporter or applicant on the export license for export control purposes. In certain routed transactions where a license is required and when the foreign buyer selects the freight forwarder and assumes responsibility for determining licensing responsibility in writing to the BXA, the U.S. forwarding agent of the foreign principal may be listed as the applicant or exporter on the license application. However, the Principal Party must still be listed on the SED or AES record. If the foreign buyer does not assume such licensing responsibility, it remains the responsibility of the Principal Party.

In addition, the new rules make other changes to the SED to make the information on the paper form consistent with the information transmitted electronically via the Automated Export System (AES).

It may not be long until this new SED becomes obsolete. A recent report issued by the U.S. Department of Commerce recommends that shippers and forwarders be required to file SEDs through AES by 2005.

And to push this process along, the Census Bureau has convinced several ocean carriers to charge exporters and freight forwarders $100 for every paper SED they file.

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Click here to view a copy of the new SED. You will need Adobe Acrobat Reader to view and print this form. Click here if you need to download the free program.

Click here to view the new rules published by Census.

Click here to view the new rules published by BXA.

Click here to download a Shipping Solutions 2000 export documentation software demo that includes both the new SED and full AES Certification.