Transport & Logistics. First and last line of defense for export controls

Transcription

1 Transport & Logistics First and last line of defense for export controls Nederland Distributieland, December 2012

2 Introductie Indirect zakendoen met sanctieland kan bedrijf duur komen te staan Je ruikt er dat je goederen richting Iran gaan, zegt een ondernemer die voor zaken in Dubai was, het emiraat dat op maar een paar uur varen van de grote Iraanse havenstad Badar-Abbas ligt. Je levert aan Dubai en je krijgt je geld uit Dubai. Dat zij de goederen naar de andere kant van de zee duwen, is dat onze verantwoordelijkheid? Zijn wij fout? Bron: Financieel dagblad 2 mei

3 Export Controls not new, but very actual! JPMorgan fined for contravening Cuba sanctions Iran blokkeert olietransport bij sancties Debarment of Several Major Freight Forwarders May Disrupt International Sales Sanctions against Syria's oil and gas industry Shell accused over Syrian oil exports Britse banken breken met Iran om rapport IAEA German Store Selling Cuban Rum Online Cut Off By PayPal Cloud Computing Users Risk Export Control Breaches 3

4 Stelling I Export control compliance is de verantwoordelijkheid van de verlader/ exporteur en niet van de logistiek dienstverlener EENS / ONEENS? 4

5 Stelling II De risico s zijn te groot en daarom is het ons beleid om geen strategische goederen te (doen) vervoeren EENS / ONEENS? 5

6 Export Controls What is it all about? 6 6

7 Export controls What is it about? 7

8 Increasing globalization leads to increasing Export Control obligations to consider RU Law for the certification of goods US EAR, ITAR EU NL WSG, WSD, USG, BSG EG Dual-Use-VO CN Chinese Export Law BR Brazilian Export Law AU Export Control Act... as well as many other International Agreements 8

9 Export Controls What is it about? Revolves around four elementary questions: 1. What are you exporting? 2. Where is it going? 3. To whom is it going? 4. What are they going to do with it? 9

10 Export Controls What is it about? Scope of items controlled Dual-use items (civilian and military uses) Munitions (conventional military weapons and WMD) Other products under Catch-all provision

11 Examples of dual-use items Dual-use Item Civilian Use Military Use Titanium Alloy Carbon Fibre Watches, Eye-glass Frame Golf Club Shafts, Fishing Rod, Bicycle Gas Centrifuge for Uranium Enrichment Missile Components Triethanolamine Shampoo Chemical Weapons Fertilizer Fertilize soil Explosive devices > 400 bhp diesel engine Civilian construction works Pulling heavy trailers for tanks

12 Examples of industries typically subject to export controls Export Controls apply amongst others to companies within the industries: Aerospace and Defence Oil & Gas Transport & Logistics Technology Telecommunications Chemicals Pharmaceutics Finance Medical devices Are you servicing customers within any of these industries? 12

13 Export Controls Sanctions & Embargoes Ban on trade Arms / military goods Goods for internal repression Certain industries Exceptions foods/medicines Ban on persons - visa Blocking persons property & funds US EU Afghanistan Balkans Belarus China Congo Cuba Cyprus Egypt Eritrea Fiji Guinea Haiti Iran Iraq Ivory Coast Kyrgyzstan Lebanon Liberia Libya Myanmar/Burma Moldova Niger North Korea Pakistan Sierra Leone Somalia South Sudan Sri Lanka Syria Tunisia Venezuela Vietnam Yemen Zimbabwe 13

14 Export Controls What is it about? WHAT is being exported? WHERE is the export destined? WHO am I selling to? WHAT is the end use? Product Classification List of sanctioned countries Restricted Party Screening End Use Review Export License Determination

15 Export Controls to be considered? Export of truck with military specifications from NL to the US Export controls to be considered? Export Export of solar panels from NL to the US Export controls to be considered? 15

16 Export Controls to be considered? Gas masks to be exported from NL to Iran Export Controls to be considered? Export 16

17 Export Controls to be considered? Delivery of object detection systems from NL to Italy Export controls to be considered? 17

18 Grey Areas - Export Controls to be considered? Parts to be exported from NL to Dubai Export Controls to be considered? Export 18

19 Stelling III Wij weten wie van onze klanten strategische goederen levert EENS / ONEENS? 19

20 Stelling IV Wij (en ook onze klanten) doen geen zaken met business partners die op één van de zwarte lijsten staan EENS / ONEENS? 20

21 Export Controls Risk or Unique Selling Point? 21

22 What are the main export control responsibilities of a T&L company Screening of all parties to a transaction Verification of embargo restrictions Verification of the goods export (license) authority Documentation and recordkeeping Failure to fulfil these legal requirements may result in a violation of applicable laws and regulations and make a T&L company subject to penalties. 22

23 When it goes wrong real life examples Most recently, several major international freight forwarding companies (Kühne + Nagel AG, Panalpina Inc, Panalpina AG, Schenker AG, BAX Global Inc) were debarred from moving US military goods, ie. they were placed on a black list for violating US antitrust legislation FedEx settled for an amount of US$370 K for allegedly not screening consignees against the denied party list and for not verifying whether an actual export license was required and/or whether an export license actually did exist Maersk Line Ltd. settled alleged violations against an amount of over US$ 3 mio. The alleged violations concerned providing unlicensed shipping services for shipments of cargo originating in or bound for Sudan and Iran Elite International Transportation Inc. settled for an amount of US$ alleged violations of making false or misleading representations in the export control documents (customs declarations) by stating that no export license was required whereas licenses were required Penalties Imprisonment Confiscation Loss of privileges (export) Reputational damage Compliance investment 23

24 Benefits and chances of optimizing export control management Prevent supply chain delays Protecting your brand Reduce compliance costs and mitigate risks (fines, loss of export privileges and reputation) Avoiding enforcement actions Operate in area s previously not possible Less barriers in dealing with US markets Greater market share Using export control compliance as a Unique Selling Point 24

25 Stelling V Wij zien een groeiende vraag naar het kunnen aanbieden van export control diensten, classificatie, aanvragen van export vergunningen, etc. EENS / ONEENS? 25

26 Which control measures to have in place? Management involvement in export control risk analysis and follow up decisions Availability of adequate export control knowledge (eg. Export control manager, export control awareness trainings) Compliance organization with sufficient authority and responsibility to make independent decisions about transactions Procedures and organizational measures for identification of export control items/activities and for ensuring compliance with the export control obligations (eg. classification & license application procedure, documentation and recordkeeping procedure) Security measures that ensure that all trade partners (eg. customers, suppliers, service providers) and employees are screened Process of internal/external audits for monitoring export control compliance Escalation procedures (notification of non-compliance issues) Export control manuals / instructions Mng Sales Proc Wrh HR Sec Cust EXPORT 26

27 Export Control is more than just compliance, it creates safety and comfort and keeps your client in business Ron Admiraal Partner - Assurance / International Trade Compliance [email protected] Tel: +31 (0) Mobile: +31 (0) Annemieke de Groot Senior Manager Customs & International Trade Department [email protected] Tel: +31 (0) Mobile: +31 (0) All rights reserved. Not for further distribution without the permission of. "" refers to the network of member firms of PricewaterhouseCoopers International Limited (IL), or, as the context requires, individual member firms of the network. Each member firm is a separate legal entity and does not act as agent of IL or any other member firm. IL does not provide any services to clients. IL is not responsible or liable for the acts or omissions of any of its member firms nor can it control the exercise of their professional judgment or bind them in any way. No member firm is responsible or liable for the acts or omissions of any other member firm nor can it control the exercise of another member firm's professional judgment or bind another member firm or IL in any way.