Final rules issued on export declarations

By Staff -- Logistics Management, 8/1/2000

New rules regarding shippers' and forwarders' responsibilities when preparing Shippers Export Declarations (SEDs) took effect on July 10. Shippers and forwarders have a 90-day grace period for compliance that ends Oct. 10th.

The rules, which were jointly issued by the U.S. Census Bureau and the Bureau of Export Administration (BXA), specify which parties are responsible for providing data to the federal government in various circumstances. They also detail which types of data each party must provide, as well as where responsibility for compliance lies.

A brief summary of the major changes in the SED regulations, courtesy of the Coalition of New England Companies for Trade (CONECT), follows. For full details, shippers should review the final rules, which are available online at www.census.gov/foreign-trade/regulations.

Definitions. Three parties have responsibility for providing data on SEDs. The U.S. Principal Party in Interest is the party that receives the primary benefit of the export transaction. This could be the seller, the manufacturer, the order party, or even a foreign entity. The Foreign Principal Party in Interest is the foreign buyer, which bears responsibility if it purchases the items in the United States for export. The U.S. Forwarding Agent is authorized by the Principal Party in Interest to perform services that facilitate the export of the goods. The forwarding agent cannot be the Principal Party in Interest unless it is acting as an order party and therefore has a financial interest in the transaction.

Filing SEDs. The U.S. Principal Party must prepare and file the SED itself or else provide written authorization for the forwarding agent to do so. The rules specify the responsibilities of each party for providing, maintaining, and supporting the SED data and documentation.

The rules also specify 10 pieces of information that must be provided by the U.S. Principal Party in Interest when it is acting on behalf of a foreign entity. The forwarding agent in such a transaction must also provide an additional 16 specific pieces of information. The agent, moreover, must obtain written authorization from the foreign party to act on its behalf.

Responsibility for compliance with SED requirements. Primary responsibility rests with the U.S. Principal Party. In a "routed transaction," in which the foreign buyer is the Principal Party, the authorized forwarding or other agent is responsible. This does not, however, absolve all parties from their responsibility to provide truthful, accurate data.

Licensing responsibilities. The U.S. Principal Party is responsible for ensuring compliance with U.S. export control laws. In a routed transaction, the foreign party may assume this responsibility but only under a written agreement with the U.S. party and only if it has a qualified U.S. agent to manage that function.