Export Compliance Program First Element: “Management Commitment”
July 8, 2021
(The Exporting Source)
by Blake Gill *
Welcome back friends! Our last topic was an introduction
to the Export Compliance Program or ECP.
We went over the basic elements of an ECP and
some factors of the organization that may
affect the outcome of the ECP. As promised, we
will take a deeper dive now into the first
element of the ECP.
If this is the first time creating an ECP,
you will begin with the last element of build
and maintain your ECP; obviously with a focus
on the “build” part. For simplicity’s
sake, we will begin our deep dive into
Management Commitment. This is one of the most
critical aspects of the ECP and required for
all organizations. If your organization does
not have support from management for export
compliance, the efforts will be doomed from the
beginning!
You will need to explain the importance of
export compliance and provide the basic purpose
of the ECP and how it will help the
organization protect national security and
foreign interests. One of the best factors one
can use when explaining export compliance to
management is to emphasize the devastating
monetary penalties that can occur if violations
were to occur without having any type of ECP in
place. There are an immense number of examples
of seven- and eight- figure fines dished out by
the government. The government even has the
power to dictate how your organization carries
out export transactions with consent
agreements. If the business is ever lacking on
their buy-in to a robust ECP, fines and
potential debarment from exporting is a great
topic to get their attention!
Management will need to understand that
compliance comes before sales. They need to
understand the cost of training for export
compliance comes before cutting costs of
training to tighten the budget. One sale being
pushed to be executed without having the proper
export compliance review could cost the company
exponentially more than that one sale. Cutting
the training budget on export compliance could
lead to an uninformed workforce that has a
higher risk of violation. These factors are
bad for business overall and management will
need to have the same respect for compliance as
the Export Compliance responsible does.
Most organizations with a robust ECP will
have a management commitment statement that is
included with the most top-level policy and
procedure. This commitment should be captured
in the employee handbook and include an
employee acknowledgement form with employee
signature. Finally, management will need to be
committed by providing the proper resources and
budget to the department responsible for export
compliance. If a management team claims to
support the efforts of an export compliance
program but there is a struggle for the
financial support, you are in for a battle!
That is a sign of not having a true commitment
and the remaining efforts will come with great
difficulty.
That wraps up our discussion for the first
element! Make sure you come back for our next
discussion, breaking down the next element of
risk
assessment.
* Blake Gill is an experienced International Trade Compliance professional with a demonstrated history of work in the technology industry. He has many years of experience working with export control, customer screening and item classification over a wide variety of products. Additionally, Blake has performed the duties of Empowered Official at multiple international companies.
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