4673 – Chap 7

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CHAPTER 7 – EXPORTING FROM THE U.S.

A. GOVERNMENT SUPPORT (OF U.S. EXPORTS)

I. U.S. International Trade Administration (ITA)

1. Division of U.S. Dept of Commerce

2. Purpose:

a. To promote trade and investment

b. Ensures fair trade by enforcing U.S. trade laws and

agreements.

3. Three divisions:

a. Overseas Offices (a/k/a Foreign Commercial Service/U.S.

Commercial Service)

i. Offices in 80 countries

ii. Help introduce U.S. businesspersons to local

business and government leaders

iii. Offer business services including:

 trade leads
 financial counseling
 export opportunities
 political and credit risk analysis
 analysis of local laws

b. Headquarters Offices

i. Country analysis using desk officers

ii. Desk Officers (2 categories)

 Market Access and Commercial Policy

Specialists assess a country’s economic climate,
trade policy, political climate

 Trade information/Trade development

Specialists who assess industry characteristics
(products/services) opportunities, etc.
Continued
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c. Domestic Offices

i. Operating through Export Assistance Centers

(EACs) in the U.S.

ii. Offers services of U.S. Commercial Service, EXIM

Bank, SBA, in single location

II. District Export Councils

1. Organizations of local/regional business leaders

2. Appointed by Secretary of Commerce

3. Work as volunteers alongside EACs

4. Services include:

a. “How-to” international trade seminars and workshops

b. Public awareness of Dept of Commerce trade assistance

programs

OMIT: “Small Business Development Centers” and “Service Corps of Retired

Executives” p. 171

III. Office of Export Trading Company Affairs (OETCA)

1. Allows U.S. businesses to join together to export using Export

Trading Companies

2. Administered through the ITA

3. Issues Export Trade Certificate of Review

a. Allows exporters to avoid antitrust legislation

b. Enables firms to work together to reduce export costs and

risks while developing new export business opportunities

OMIT: From “INFORMATION SOURCES” p. 172 to middle of p. 179

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B. FREIGHT FORWARDING

I. Freight Forwarder

1. Defined as: private company licensed to support shippers and the

movement of their goods.

2. Provides advice on:

a. Export/import documentation
b. Freight costs/shipping rates
c. Consular fees
d. Insurance
e. Packing

3. Types include:

a. Ocean freight forwarder

i. Must be licensed by Federal Maritime Commission

b. Air cargo agents

i. Certified by Cargo Network Services (U.S.) through

International Air Transportation Association (IATA)

II. Shipper

1. Any company may ship its own goods but cannot receive
compensation without license

C. EXPORT CONTROLS

I. Export license

1. Defined as: a grant of authority from a government issued to a

particular exporter to export a designated item to a designated
country

2. Features

a. Issued on a case-by-case basis

b. Issued for single transaction or multiple transactions within a

specified period of time
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II. U.S. Export license/control

1. Jurisdictional control of licenses

a. Dept of Commerce/Bureau of Industry and Security (BIS)

– most items exported.

b. Other departments:

i. Dept of State – arms, ammunition, etc.

ii. Dept of Justice/DEA – dangerous drugs, narcotics
iii. Nuclear Regulatory Commission – nuclear
materials
iv. Dept of Agriculture – meat, poultry, etc.

2. Bureau of Industry and Security (BIS)

a. Administers the Electronic Export Information (EEI)

(formerly the Shipper’s Export Declaration (SED) (Form
7525-v)

i. Electronic Export Information (EEI)

 EEI required for all exports needing export license

 EEI indicates to U.S. Customs type of export
authorization used (e.g. dangerous good, etc.)
 Used to compile trade statistics for U.S. Census

b. Interprets the Export Administration Regulations (EAR)

c. Types of licenses:

i. “Dual Use” – for goods having both commercial and

military applications

ii. Validated license – issued for items usually under

control of a U.S. government agency/dept (i.e., CCL)
and requires a license (e.g., arms shipment)

iii. License Exception – on CCL, needs license

iv. No License Required (NLR)

 Items subject to EAR but not listed on CCL under
a specific ECCN
 On CCL but no license needed
Continued
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c. Types of licenses (continued):

v. EAR99
 Items not on CCL
 Generally, no license required
 Vast majority of goods shipped from U.S.
 EXCEPTION – Item is not going to embargoed
country, prohibited end user, or prohibited end
use.

3. Commerce Control List (CCL) and Export Control

Classification Number (ECCN)

a. Characteristics of CCL and ECCN

i. Classifications of lists of controlled items

ii. ECCNs are listed in the Commerce Control List (CCL)

iii. Product’s ECCN is number derived from the

categories of the CCL

b. Categories of CCL (ten categories):

0 = Nuclear materials, facilities and equipment (and

miscellaneous items)
1 = Materials, Chemicals, Microorganisms and Toxins
2 = Materials Processing
3 = Electronics
4 = Computers
5 = Telecommunications and Information Security
6 = Sensors and Lasers
7 = Navigation and Avionics
8 = Marine
9 = Propulsion Systems, Space Vehicles, and Related
Equipment

Five product groups (subset of CCL)

A. Systems, Equipment and Components
B. Test, Inspection and Production Equipment
C. Material
D. Software
E. Technology

OMIT: “EXPORTER’S OBLIGATIONS” p. 183 to end of chapter