Top 10 considerations for Exporters
1. Written Contract
o When do you need a contract?
o Dealing with “passing of title”/risk, product issues/warranty, unexpected events/Force majeure
2. Intellectual property right protection
o Review the company's product portfolio and take action to register the patents and marks that have not been properly registered in the foreign country
o Register both the English and local language versions of the marks
3. Product compliance and registration
o Many products must be registered, certified or licensed by the relevant government authority before they can be sold in the foreign country.
o Products concerning human health and safety, or products which are deemed potentially hazardous to human, animal or environmental health and safety, usually have certification or registration requirements.
4. Import Compliance
o Customs Valuation
o Harmonized codes for products
o Customs duty rates
o Country of origin markings and Free trade agreements
o Check import requirements and documentation
5. Export Compliance
o What is the ECCN of your products?
o Do your exports need a license from the Commerce or State department?
o Ensure you are not shipping to a restricted party, prohibited country or restricted end-use.
6. International transportation
o International transport is considerably more complex than for domestic carriage. An exporter needs to very clear about the precise costs and obligations for which he is assuming responsibility.
o If you don’t inform yourself about the costs and risks of the many possible ways of dealing in your contract with the way in which your goods are to be delivered, you may face unexpected difficulties or disputes.
o A common way of describing the allocation of the parties’ responsibilities for export packaging, freight, and insurance is to refer to Incoterms in your contract.
7. Anti-bribery
o The Foreign Corrupt Practices Act (“FCPA”) is a federal statute passed by Congress in 1977 to prohibit bribery of foreign government officials for the purpose of obtaining or retaining business
8. Currency & Payment Terms
o Ensure your export agreement mitigates the risk of non-payment.
o Another simple solution is pre-payment or using an Irrevocable LC .
o Conduct a thorough credit check on the party importing your items.
9. Dispute Resolution
o At what location will the parties resolve the dispute?
o What method of dispute resolution will the parties use?
o Arbitration clause is a more effective means to provide certainty to the dispute resolution process.
10. Political Risks
o War & Civil unrest
o Expropriation without just compensation
o Embargoes & Sanctions
