Routed Exports 2020: Blindfolded and Walking Through a Minefield – What Could Go Wrong?

Routed Exports. Need I say more? There are few topics in the export compliance realm that stir more controversy! This is for good reason.

The lines of responsibility can be blurry at times, and the differences in regulations can cause even the oldest, saltiest trade compliance professionals to tremble in their loafers. Not to worry – the Census Bureau is aiming to right all the wrongs we have suffered at the hands of regulations that are vague at best and conflicting at worst. The question is: will it happen? This webinar will take a deep dive into the regulations surrounding routed exports, look at the request for comments, and review suggestions from the trade community.

Here’s a good example to wrap your mind around: according to the Foreign Trade Regulations (FTR), in a routed export, unless authorized in writing, the U.S. Principal Party in Interest (USPPI) is not allowed to see the Ultimate Consignee data that is reported in the electronic export information (EEI). How does that line up with the USPPI’s requirement to know their customer? The easy answer is that you should know before the export filing, but it can still feel a bit unsettling. It’s as if the USPPI is blindfolded and led through the export minefield by the Foreign Principal Party in Interest (FPPI) and their authorized agent. So…how well did you discuss the dangers of the minefield? And how many mines are in the field you are crossing?

Routed exports aren’t all bad, though. The truth is that routed exports are a useful and sometimes necessary tool for some companies. In some situations, the best compliance solution may be a routed export. Things break down quickly, though, if there is not sufficient communication between all parties involved, including the necessary legal documentation. Even if an FPPI agrees to routed export requirements, they may heavily depend on a U.S. agent to meet those requirements – meaning there needs to be clear and consistent communication between the USPPI and the FPPI’s authorized agent.

Do you know where the mines are in your routed exports? If not, let’s play a little minesweeper and see if we can’t find them!