#1 – USML Hand-Carry with Carnet (read more)
#2 – Preventing a License Escape (read more)
We’d like to introduce you to our series of Intelligent Solutions for Global Logistics. We’ll show you examples of unique situations that our defense trade client exporters and importers face every day and TradeLink solutions. The series will also provide an opportunity to discuss general issues that apply to USML shipments.
Our first example in this series involves a defense trade client that needed to get their engineer into (and out of) The Republic of Turkey as quickly as possible so that he could make some adjustments to USML-controlled products in use there. They needed to know what options existed for him to hand carry his equipment to Turkey. We discussed the requirement for a State Department license for his tools and how he would fare going through customs clearance in Turkey.
Exporting to Turkey, particularly on a temporary basis, is less predictable than dealing with member states of the EU. In fact, our client’s foreign consignee in Turkey said it would be “impossible to do without waiting weeks for the goods to clear Customs.”
According to export.gov, “U.S. exporters face many of the same challenges (in Turkey) that exist in other semi-developed countries, such as contradictory policies, regulations and documentation requirements, lack of transparency in tenders and other procurement decisions, and a time-consuming, unpredictable judiciary and legal and regulatory framework.”
We recommended to our client that that we apply for a Carnet on their behalf, that their engineer would present for signature at each Customs location going to and from Turkey.
We did the necessary research and background work to anticipate every contingency – including giving the engineer a map of JFK airport in New York and highlighting exactly where he needed to go with his equipment, Carnet, and DSP-73 State Department license.
After returning from a successful trip, the engineer thanked all parties involved, commending TradeLink, “None of this would have been possible if we didn’t have the proper documents, impeccably organized and easy to execute at all 4 Customs locations. Thank you for providing the Customs Carnet and the State Department license that was recognized as a quality document by all the government officials involved in Turkey and New York.”
#2 – Preventing a License Escape
This is the second issue in our series on Intelligent Solutions for Global Logistics. We’re highlighting general issues and TradeLink solutions for consultants and companies that are importing or exporting items subject to the ITAR.
A potential pitfall for companies with temporary exports of USML items under a DSP-73 license is losing track of their whereabouts over the four-year license term. If their proper return is not documented, it creates a situation known as a “license escape” that would require making a voluntary disclosure to the Department of State, Directorate of Defense Trade Controls (DDTC) and facing possible penalties.
DDTC is known to view voluntary disclosures very positively as long as the company is open about the issue and proposes a plan to prevent the violation from happening again. They may also look at the rest of your organization to be sure that proper procedures are in place.
If your organization is in a situation that requires a voluntary disclosure – such as not being able to document items on DSP-73 licenses as having been returned to the U.S. – you will need to propose a fail-safe system for tracking those items in the future.
We have worked with clients to prevent future license escapes, and this common issue led to the development of proprietary software, TLS-73, that tracks, monitors and reconciles license activity.
The success we’ve had in preventing license escapes for our clients results from using this software and from the TradeLink team’s ongoing communication with foreign consignees about the status of
the outstanding items.
A key part of our communication is a monthly series of emails that we send out of the TLS-73 program to our clients’ foreign consignees, known as “Items Outstanding Updates (IOU’s).” We document responses to these emails in which consignees estimate a return date or give us the status of each item.
Before any items are exported, TradeLink sends a copy of the DSP-73 license and a transmittal letter to each consignee outlining their responsibilities – including the requirement to respond to each IOU they receive. Responses are then tracked in TLS-73, causing the system to send emails to U.S. and Foreign License Owners, with alerts such as “Licenses Expiring within 6 Months That Have Outstanding Items.”
The TradeLink team, working with TLS-73, our U.S. and foreign client locations, consignees and agents, have been able to prevent license escapes and the need for voluntary disclosures.
If you’d like to receive examples of TLS-73 IOU emails and tracking, email firstname.lastname@example.org or give us a call at 339-600-7330.