ECCN Classification and Export Compliance: Ways of Doing It More Efficiently
Many of the U.S. based exporters and organizations involved in the international trade are aware of how important it is to follow the US federal regulations regarding exports of the goods and technology.
However, achieving compliance is not quite easy and smooth. In lack of the formal procedures that are carefully crafted with several steps of a successful program, organizations can find themselves non-compliant with the regulations immediately. Since it’s the matter of the national security, no one can just bow out of the written program and guidelines and leave the compliance in the hands of a fate. After all, the export control regulations were put together for the protection of the national security interests.
What is an ECCN and why it is important?
The ECCN (i.e., Export Control Classification Number) must be assigned to the goods, software and technology before their export and transfer. The ECCN for any given product is listed under specific categories of the Commerce Control List (CCL), and can vary based on product’s functionality, feature, and technical parameters. Further, the ECCN classification helps in identifying whether the product or technology requires an export license or if there is any license exception. Each of the categories encompasses various items on the CCL, but the items that aren’t listed on the CCL receive an ECCN of “EAR99”.
Conventional ECCN Determination Methods
How to determine the ECCN? Well, the major three methods are:
1. Identify the source. You can ask the manufacturer, developer, or producer for the ECCN of the item. Since the ECCN is subject to change, you should ensure that you have the current one.
2. Classifying it on your own. For that, you will need an in-depth technical understanding of the item’s features, content and functionality. Moreover, you have to have a familiarity with the CCL’s format and structure.
3. Send a request to BIS. With the help of CIN or Company Identification Number and PIN or Personal Identification Number, you may send an official classification request to the Department of Commerce – Bureau of Industry and Security (BIS).
As a next step you will need to know whether the export of product/technology require an export license or not. The ECCN that you determined is the key to that next step.
ECCN Determination Methods
Technology has literally transformed the way the world functions, especially through automation, speed, and accuracy.
Notably, the trade compliance consultants have made lives easier for companies and organizations. In fact, the development of software for ECCN and HTS classification has fast-tracked the performances of these companies.
In order to determine the controls, one will need to first classify the commodity, technology or software under the EAR and ITAR regulations. Therefore, the software that enables this procedure in a quick and efficient manner is extremely helpful.
Recently, the software vendors have introduced web-based solutions for the companies that have a limited budget which cannot hire a consultant or an expert. Powered by such web-based software, the exporters and importers can easily identify the items after answering a certain number of questions. Not just that, the classification results are stored for record retention purposes. The users of the software will access elaborated trade content or information in the form of definitions, duty rates, special notes, country charts, licensing requirements, and exceptions, etc.
Overall, the web-based solutions invigorate the performance of an organization, helping them increase their efficiency with rare fluctuations. As a result, the businesses won’t suffer indefinite delays of searches, communications, classifications, etc.