Shipping Solutions Newsletter

In early 2005, the U.S. Census Bureau proposed that the Automated Export System (AES) be the only way to report Shipper’s Export Declarations (SED); it would have been a mandatory system to report all exports. It would have required exporters to switch from paper to electronic reporting.

Between 2003 and 2005, most of the stories written about AES contained tag lines that read like the following example, certainly making it seem that mandatory AES filing was imminent:

Census anticipated that the shift to mandatory electronic export reporting would be welcomed by the trade, save Census money, improve export compliance, and improve reporting accuracy. Before this significant change could be made, Census was required to revise the Federal Trade Statistical Regulations (FTSR), 15 CFR Part 30.

Many of the changes were well received by cooperating government agencies (e.g. the U.S. State Department and U.S. Customs and Border Protection), exporters and freight forwarders. However, there were changes to the FTSR that were not welcomed by the cooperating agencies that delayed the adoption of the revised FTSR requiring mandatory AES filing.

In our democracy, agencies of the U.S. government must publish proposed rules and regulations in the Federal Register, the U.S. government’s official newspaper asking the trade to comment on the proposed regulations. In addition, the proposed regulations and rules must be released to cooperating government agencies and the public prior to adoption for their review and comment.

International traders (freight forwarders, exporters and agents) were ready for the changes and anticipated swift adoption of the revised regulations. Most of the largest international traders had implemented technological changes to integrate AES into their export process, conducted training and established procedures for their staff.

After months and months of delays, the mandatory rule hasn’t been published for all exporters. The U.S. Department of Homeland Security (DHS) objected to an element of the final FTSR rules released on February 17, 2005, developed by U.S. Census and supported by international traders.

The provision under 30.4(c) that DHS objected to is known as “post-departure filing.” The rule would have allowed approved U.S. Principal Parties in Interest (USPPIs) or their designated agents permission to file the AES record no later than 10 calendar days from the date of exportation. DHS objected to this rule, since it prevents pre-shipment review of shipments for security and export compliance reasons.

In addition, DHS has other security initiatives and agreements with our biggest trading partner countries to prevent terrorism. One of those initiatives is known as the Container Security Initiative (CSI). CSI encompasses several security initiatives that DHS obtained through cooperation with foreign government’s customs officials, which includes advance cargo information on shipments. The FTSR provides U.S. exporters with a promise of data confidentiality, which prevents DHS from meeting security initiatives we have begun with our foreign trading partners related to shipment data visibility.

The Census Bureau has stopped guessing when mandatory AES for all exporters (USPPIs) might occur. However, certain exporters are required to file using AES including:

The truth is Census does not have updates on the new Census regulations for full mandatory AES, according to Jerry Greenwell, who is trade ombudsman for the Census Bureau’s Foreign Trade Division, and who spoke at the Commerce Department’s Regulations and Procedures Technical Advisory Committee meeting on December 5, 2006. He was also quoted in the February 2007 American Shipper magazine as stating that he wouldn’t speculate on when the proposed regulations would finally be released.

Census continues to encourage export traders to use AES through the Census portal or through an authorized agent, such as a freight forwarder. During 2007, Census representatives visited more than 40 firms to document their AES best practices, which they have published at their website.

By Richard Vitas Palaikis II email | bio

Have you considered conducting business internationally by exporting merchandise from the United States? If so, there are many factors you should take under consideration prior to engaging in an export transaction to ensure that the venture is a success rather than a failure.

This article is the last of a three-part series that outlines the steps that should be taken to successfully establish an export market strategy.

Step 3: Develop an Export Market Strategy

Once you have determined your company’s level of export readiness and have conducted the appropriate export market research, you may then proceed to the next stage of developing your export market strategy by composing a document that includes many details of your company’s intended operations strategy for exporting merchandise.

When attempting to venture into an export market, it is often an advantage to have a documented export market strategy available for review by any of the following:

financial lenders,
governmental agencies,
internal managers/employees,
strategic partners, and
suppliers.

Typically, an export market strategy, referred to by some as an international business plan, should clearly define the objectives of the company, as well as the manner in which the company will achieve its objectives. In addition, the export market strategy should include timely, accurate and relevant information to substantiate credibility of the company’s ideals.

In general, when preparing an export market strategy you should include the following elements:

Executive Summary—provide a brief description of your company and your export market intentions with conclusions.

Corporate Profile—provide details pertaining to the capabilities and history of your company.

Management and Human Resources—provide details of the management philosophy and employee job classifications and applicable qualifications.

Target Market Profile—provide details of the target market for export political stability, geographic issues, legal system, business customs and practices, religion and cultural issues, language and governmental structure.

Market Entry Strategy—provide details of how your company will enter the foreign market.

Marketing Strategy—provide details of your company’s marketing plans including the product, the price, the place, the promotion, the people and the after-sales service requirements.

Operations—provide details of your company’s manufacturing production process.

Financial Analysis—provide details of your company’s projected financial performance for at least three years ahead.

Risk Management—provide details of any strategy put in place to minimize exposure to risks associated with the export venture.

Conclusion—provide a complete summary of your company’s desire to enter an export market, as well as any concluding remarks that recap some of the key points of the proposed venture.

When composing your export market strategy, it is important to include a provision that will allow for the constant monitoring of business operations since it may be necessary on occasion to deviate from your initial plans if they are not yielding the expected results.

Prior to engaging in a sustained export venture, you must do your homework and cover all aspects of your proposed venture; otherwise you could quickly end up as a failure in the international marketplace and potentially damage yourself in the domestic marketplace as a result.

The export planning process is not easy, so take your time and make sure that you cover every aspect in detail prior to engaging in an export venture so that you are as successful as possible!

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Thousands of successful exporters are using Shipping Solutions to complete their export documents faster, easier and less expensively than ever before. Why aren't you?

If you're too busy trying to complete your export documents by hand to spend some time reviewing the Shipping Solutions Professional export documentation and compliance software yourself, let us do it for you! Sign up for one of our free online demos and let us give you a one-hour overview of the software.

We'll take you step-by-step through the process of completing your export forms, filing your SEDs electronically through AES, and checking your exports against the various government restricted parties lists and export regulations to make sure your shipments are in compliance, and you—and your company—stay out of trouble.

These free online demos are available on Tuesdays at 1:00 p.m. and Thursdays at 10:00 a.m. Central Time. All you need is an Internet connection to watch the demo and a phone to listen in and ask questions about the software. It's the perfect opportunity to get your first view of Shipping Solutions or to convince your coworkers and your boss that Shipping Solutions is the perfect solution for your company.

See why Shipping Solutions is America's #1 export software. Sign up for the free online demo today!

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