EXPORT SESSION 3:EXPORT CONTROLS AND COMPLIANCEGuam State Trade and Expansion Program (STEP) Training Series

DISCLAIMER: The Pacific Islands Small Business Development Center Network (PISBDCN) at the University of Guam – School of Business & Public Administration is partially funded by acooperative agreement with the U.S. Small Business Administration (SBA). All opinions, conclusions or recommendations expressed are those of the author(s) and do not necessarily reflect theviews of the SBA. Requests for reasonable accommodations for persons with disabilities will be made if requested at least two weeks in advance. Language assistance services are availablefor limited English proficient individuals with at least two weeks advance notice. For arrangements, please contact Laurine Sablan, P.O. Box 5014, Mangilao, Guam 96923, Tel: (671)735-2590,or Email sbdc@pacificsbdc.com. Services are extended to the public on a non-discriminatory basis.

TRAINING AGENDA

• What you need to know about the Gold Key Matchmaking program with John Holman

• Get to know the exporter: Gerard Aflague of The Gerard Aflague Collection

• What? Where? Who? End use?

• General Data Protection Regulation (GDPR)

• Intellectual property considerations

BUREAU OF INDUSTRY & SECURITY

• BIS oversees the Export Administration Regulations (EAR)

• Dual-use items must be verified on the Commerce Control List (CCL)

• If items are on the CCL, an Export Control Classification Number or ECCN will be listed

• All items not on the CCL are classified at EAR99

• EAR99 goods may require a license if they are destined to an embargoed country, to an end-user of concern (“bad-boy’), or to a prohibited end-use

BUREAU OF INDUSTRY & SECURITY

• What is dual-use?

• Pickup trucks dual use if it can

be mounted with a gun

platform

• Sony PlayStations thought to

control guided missiles

• Cow manure, when processed

into a fertilizer, can be used

an explosive

RED FLAG CHECKLIST

Warning alarm should sound if the

customer:

• Won’t give end-use/user info

• Pays cash for high value shipments

• Doesn’t know the industry or product

• Declines normal warranty or service

• Orders stuff incompatible w/ the business

DESTINATION CONTROL STATEMENT

• “These commodities, technology, or software

were exported from the United States in

accordance with the Export Administration

Regulations. Diversion contrary to U.S. law is

prohibited.”

• Helps ensure your exports go only to legally

authorized destinations

• Place on commercial invoice and bill of

lading

• Notifies the carrier that the export products

may not be diverted to another destination

DEEMED EXPORT RELEASES

• The release of information at a trade show with a foreign national is subject to EAR

• Showing visual aids or blueprints of your product to foreign nationals

• A foreign delegation visit to a company’s internal tech conference

ANTIBOYCOTT REGULATIONS

• What are they: Prohibits U. S. firms from participating in foreign

boycotts or embargoes not authorized by the U. S. government

• Who is covered: Individuals and companies located in the U.S. This

includes U. S. exports, imports, financing, forwarding, and shipping

and certain other transactions that may take place outside the U.S.

• What do the laws prohibit: Refusals to do business; discriminatory

actions against any U. S. person on the basis of race, religion,

gender, or national origin; furnishing information to a boycotting

country

U.S. FOREIGN CORRUPT PRACTICES ACT

• Prohibits bribery of foreign officials by U. S. individuals and corporations to obtain or retain a business

• Establishes standards for maintaining corporate records and internal accounting control objectives

• “knowing” – conscious disregard or turning a blind eye

https://www.justice.gov/criminal-fraud/fcpa-resource-guide

IMPORT REGULATIONS OF FOREIGN GOVERNMENTS

• Import documentation varies by country

• Be aware of regulations that apply to operations and transactions

• Consular invoices

• Certificates of inspection

• Health certification

• Work with your freight forwarder to updated info on the documents you need

U.S. FOREIGN TRADE ZONES

• Special areas within the U.S. that help reduce import duties and other costs

• Most are located near ports of entry

• Located in all 50 states and Puerto Rico

• What can you do in an FTZ: Warehousing, manufacturing, storage, assembly, processing

• Payments of duties are not required on foreign merchandise unless and until it enters CBP territory for domestic consumption

U.S. FOREIGN TRADE ZONES

Advantages of using FTZ’s

• While in the zone, merchandise is not subject to U.S. duty or excise tax

• Merchandise may remain in a zone indefinitely

• CBP security requirements provide protection against theft

• Goods may be exported from the zone free of duty and excise tax

• Duty and tax rate may change based on operations conducted within the zone

• http://ita-web.ita.doc.gov/FTZ/OFISLogin.nsf

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CUSTOMS BONDED WAREHOUSE

• a building or other secured area in which imported dutiable

merchandise may be stored, manipulated, or undergo

manufacturing operations without payment of duty for up to 5

years

• Warehouse proprietor incurs a liability for the merchandise

under a warehouse bond

• Liability is cancelled when merchandise is exported, taken out

for supplies to a vessel or aircraft; destroyed under CBP

supervisions; or taken out for use or sale within the U.S. after

payment of duty

CUSTOMS BONDED WAREHOUSE

Advantages of using Bonded Warehouses

• Duty is not collected until the merchandise is withdrawn for consumption

• Importer controls use of money until the duty is paid upon withdrawal of the merchandise

• If no domestic buyer, importer can sell merchandise for export

• Check with CBP if your merch can be placed here

• Duties owed on articles that have been manipulated are determined at the time of withdrawal

GENERAL DATA PROTECTION REGULATION

• Gives individuals better control over their personal data

• “Personal data” is any information that relates to a person, such as names, email addresses, IP addresses, eye color, political affiliation, etc.

• Provides rules for collection and handling of data

• Organizations outside of the EU are also affected

• High penalty fees based on global revenues

• Just one complaint can trigger an investigation

GENERAL DATA PROTECTION REGULATION

• Online forms could inadvertently collect data on EU citizens

• Also applies to data collected on any Europeans living in the U.S.

• Data also includes any indirect data such as physical or physiological information

• Economic or social demographics that can be triggered back to any specific individual

• Most enforcement agencies are 100% self-funded through fines and fees

GENERAL DATA PROTECTION REGULATION

How to comply?

• Protect subject rights: Ask for consent to hold data, withdrawal of consent at any time and data erasure, grant full access to how data is processed

• Legal Data uses: fraud detection, law enforcement and watch lists, cyber and IP security, employment data, transact business, process payments

• Accountability and compliance: only process data for authorized purposes, safeguard from additional processing, erase all data when service agreement ends

GENERAL DATA PROTECTION REGULATION

INTELLECTUAL PROPERTY - COPYRIGHT

• Protection of published works and original works of authorship

• Berne Convention for Protection of Literary and Artistic Works: provides creators such as authors, musicians, poets, painters the means to control how their works are used, by whom, and on what terms

• Universal Copyright Convention: copyright proprietors in literary, scientific and artistic works, including writings, musical, dramatic and cinematographic works, and paintings, engravings and sculpture

INTELLECTUAL PROPERTY - COPYRIGHT

• U.S. copyright gives owner exclusive right to reproduce work, or to have spin-offs

• Gives owner the right to distribute copies

• Gives owner the right to display or perform work publicly

• Place of publication determines availability of copyright protection

• Some countries offer limited or no protection for published work of foreign nationals

INTELLECTUAL PROPERTY – TRADEMARK

• Trademark is a word, symbol, name, slogan, or combination to identify source and distinguish goods

• Many countries require local use of registered mark

• Some countries do not protect service marks

• Decide where you need trademark protection

• Balance cost of registration with its benefits

• File in countries known to create counterfeit goods

• Investigate local meaning of mark or trade name before going through the process

INTELLECTUAL PROPERTY – TRADEMARK

• Also related to color, script

INTELLECTUAL PROPERTY – PATENT

• Patents protect inventions – utility, design, plant

• Utility patents may be granted to anyone who invents or discovers any new and useful process, machine, article of manufacture

• Design patents may be granted to anyone who invents a new, original, and ornamental design for an article of manufacture

• Plant patents may be granted to anyone who invents or discovers and asexually reproduces distinct and new variety of plant

INTELLECTUAL PROPERTY – PATENT

• Paris Convention: countries are not allowed to discriminate against each others’ companies

• Patent Cooperation Treaty: allows you to file one “international” application with the U.S. Patent and Trademark Office, to designate member countries in which a patent is sought

• For inventions made in the U.S., U.S. law prohibits filing abroad without a foreign filing license from the USPTO unless 6 months have elapsed since a U.S. application was filed

INTELLECTUAL PROPERTY

INTELLECTUAL PROPERTY RIGHTS

INTELLECTUAL PROPERTY RIGHTS

INTELLECTUAL PROPERTY RIGHTS

LOGISTICS AND TRAINING INFORMATION

• Training is weekly on Tuesdays, from 1:00 p.m. to 3:00 p.m. via Zoom. A link will be provided via email for registered participants.

• Please be advised training dates may change or be rescheduled. Check your email regularly for updates.

• Review training and advisement requirements for your STEP application.

Training Schedule and materials

GUAM STEP TRAINING SCHEDULE

Training Topic Date & Time

Export Plan: Market Research and Strategy

Feb. 16, 2021 1pm-3pm

Digital marketing and eCommerce for export

Feb. 23, 2021 1pm-3pm

Legal and regulatory compliance for export

Mar. 02, 2021 1pm-3pm

Logistics and Incoterms Mar. 09, 2021 1pm-3pm

Export payments and financing

Mar. 17, 2021 10am-12pm

QUESTIONS?

FOR QUESTIONS ABOUT GUAM STEP PROGRAM AND APPLICATION

Melvin Tabilas, Guam STEP DirectorGuam Economic Development Authority(671) 647-4332 melvin.tabilas@investguam.comwww.investguam.com

FOR EXPORT PLAN ASSISTANCE, TRAINING, AND BUSINESS COUNSELING

Angel Camacho-Paulino, Business Advisor Guam Small Business Development Center(671) 735-2590angel@pacificsbdc.comwww.pacificsbdc.com

IN SUMMARY

• Check import regulations of the foreign country you plan to do business with.

• Seek out export partners in foreign markets to gain insight.

• Tuesday, Mar. 9 @ 1:00pm Logistics and Incoterms

• Scan the QR code below to schedule a counseling session and/or sign up for other business training.

• Please complete the post-training survey.

• Thank you and have a great day!