Further Details on BIS' Updated Freight Forwarder Guidance (Routed/Non-Routed Export Transactions)

In January 2010, the Bureau of Industry and Security updated its Freight Forwarder Guidance, which included updated information on the responsibilities of the forwarding community, routed and non-routed export transactions, the Automated Export System; and risk mitigation and public/private partnerships.

BP has already issued an overview of this updated guidance, followed by a summary providing additional details from the guidance on risk mitigation and public/private partnerships. (See ITT's Online Archives or 01/15/10 and 02/04/10 news, 10011520, 10020435, for previous BP summaries.)

This summary provides further details from the guidance on forwarder responsibilities in routed and non-routed export transactions.

Routed Export Transaction Responsibilities

In a section entitled "Routed and Non-Routed Export Transactions," BIS states that:

In a "routed export transaction," in which the foreign principal party-in-interest authorizes a U.S. agent to facilitate the export of items from the U.S., the U.S. PPI obtains from the foreign PPI a writing in which the foreign PPI expressly assumes responsibility for determining licensing requirements and obtaining authorization for the export. In this case, the U.S.agent acting for the foreign PPI is the "exporter" under the Export Administration Regulations¹, and is responsible for determining licensing authority and obtaining the appropriate license or other authorization for the export.

The U.S. agent representing the foreign PPI in this type of routed export transaction must obtain a power of attorney or other written authorization in order to act on behalf of the foreign PPI.

The EAR requires the U.S. PPI to furnish the foreign PPI and its U.S. agent, upon request, with the correct Export Control Classification Number (ECCN) or sufficient technical information to determine the ECCN. In addition, the U.S. PPI must provide the foreign PPI and its U.S. agent with any information that it knows will affect the determination of license authority.

The updated guidance states that the U.S. PPI also has responsibility under the FTR to provide certain data to the U.S. agent for the purposes of filing electronic export information.

(If the U.S. PPI does not obtain from the foreign PPI the writing described above, then the U.S. PPI is the "exporter" and must determine licensing authority and obtain the appropriate license or other authorization. BIS has updated the guidance to state that this is true even if the transaction is considered a routed export transaction for purposes of filing electronic export information pursuant to the Foreign Trade Regulations (FTR) at 15 CFR Part 30.

Note that the U.S. agent may be a forwarding or other agent.)

Non-Routed Export Transaction Responsibilities

In a transaction that is not a routed export transaction, if the U.S. PPI authorizes a U.S. agent to prepare and file the export declaration on its behalf, the U.S. PPI is the "exporter" under the EAR¹ and is required to:

(a) provide the U.S. agent with the information necessary to complete the AES submission;

(b) authorize the U.S. agent to complete the AES submission by power of attorney or other written authorization; and

(c) maintain documentation to support the information provided to the U.S. agent for completing the AES submission.

Authorized U.S. Agent Responsibility

If authorized by either the U.S. or foreign PPI, the U.S. agent is responsible for:

(a) preparing the AES submission based on information received from the U.S. PPI;

(b) maintaining documentation to support the information reported on the AES submission; and

(c) upon request, providing the U.S. PPI with a copy of the AES filed by the U.S. agent.

Authorized U.S. Agent and PPI Responsibility

Both the U.S. agent and the PPI who has authorized the U.S. agent are responsible for the correctness of each entry made on an AES submission. Good faith reliance on information obtained from the PPI can help protect an U.S. agent, but the careless use of "No License Required," or unsupported entries, can get a U.S. agent into trouble. U.S. agents without the appropriate technical expertise should avoid making commodity classifications and should obtain support documentation for ECCNs.

AES Data

The updated guidance adds a statement that, upon written request, Census will provide companies with twelve months of AES data free of charge every 365 days. The Census Bureau's Foreign Trade Division currently provides U.S. PPIs, and other filers requesting their AES data, with all ten data elements required in routed export transactions.

(Note that the updated guidance also replaces references to Shipper's Export Declarations (SEDs) with Automated Export System (AES) filing information.)

¹However, under the Foreign Trade Statistics Regulations (FTSR), the "exporter" will always be the U.S. PPI.

BIS Freight Forwarder Guidance (updated 01/07/10) available at http://www.bis.doc.gov/complianceandenforcement/freightforwarderguidance.htm