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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