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Wednesday, June 24, 2009

The Law of International Trade: A Business Overview

U.S. companies engaged in international trade should be alert to the legal issues unique to the international context. This article is intended to raise your awareness of some of the legal issues encountered in international trade.
Exporting (shipping products outside the United States) is normally easy and subject to few restrictions. Most exports of ordinary trade goods to friendly countries are made under a so-called “general license.” There are, however, export restrictions you need to be aware of:
Some products (notably products that have military uses) are subject to export restrictions. Note that some products have “dual-use” applications, i.e., may be used for both civilian and military purposes. When in doubt seek advice as to whether your product may require a special export license, or may be unable to be exported.
Exports to some countries may be restricted. The Bureau of Industry and Security of the U.S. Department of Commerce has a website listing countries affected by export restrictions (“Where are you Exporting” Note that you may violate export restrictions by selling a product to a buyer that you know, or should know, intends to re-export the product to a country to which direct exports from the U.S. are prohibited.
Export sales to some purchasers may be restricted. You should consult the “do not sell” lists maintained by the Bureau of Industry and Security of the U.S. Department of Commerce (“Who Will Receive Your Item” .and by the Office of Foreign Assets Control of the United States Treasury Department Under U.S. law you have an affirmative obligation to “know your customer,” including the ultimate buyer if your customer re-exports the products. You will not be able to plead ignorance if your Canadian customer sells your products to the Cuban military and you knew or should have known that this was your customer’s intention.
Freight-Forwarders. When exporting products it will be helpful to develop a relationship with a reputable freight-forwarder who can help ensure that your company complies with the laws and regulations governing exports. Deemed Exports. It is possible to make a prohibited export of technology without knowing you are doing so. Technology whose export is restricted may be “imbedded” in your product’s controls. And you may be “deemed” to export technology merely by giving individuals from a foreign country access, in the United States, to that technology sufficient to enable those individuals to take that technology back home with them.

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