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Products are commonly shipped from one country to another. This type of commerce is generally essential to a nation’s economy and welfare. The manner in which this is done, however, is not usually left to the whims of the shippers and receivers. Instead, there are laws and regulations that govern the process of exportation and importation. These guidelines are known as trade compliance.
International trade can be very complicated. One reason for this is because there is not a single set of global trade rules. In many cases, there is not a single set of rules within a nation.
The same item can be subjected to different trade regulations depending on which other country is involved in the deal. Trade agreements are contracts entered into by two or more countries. These often determine what actions constitute compliance and non-compliance.
To be compliant, importers are generally required to provide information about the goods they receive. This information can vary from one country to another and depending upon the goods that are being dealt with. At a minimum, an importer or exporter is usually required to state what a shipment consists of and its value. Either of those parties may also be required to state the purpose of the goods being transferred.
Trade compliance does not only determine the steps that one must take when engaging in international commerce. Laws and regulations also dictate the things parties are not allowed to do. For example, some countries prevent sending or receiving certain items from certain other countries.
Trade compliance is often taken very seriously. Failure to follow such laws and regulations can result in a range of negative consequences. In some cases, materials may be confiscated and destroyed or returned to the sender. In some cases, the receiver may be charged penalties or imprisoned. There is also the possibility that trade could be blocked from certain entities or countries.
Since trade can be such a serious matter, there are often many sources that individuals or businesses can turn to for assistance. Some may be governmental. In the United States, for example, the Department of Commerce has a Trade Compliance Center that can help with foreign trade issues. There are also private companies that specialize in helping companies be compliant, whether importing or exporting. Utilizing the available resources can be a wise decision because ignorance of trade requirements is often not accepted as a defense for violations.
Strict trade compliance is all well and good but let's not forget that the costs imposed on imports directly translates into higher cost of goods for us.
So if we import cars from Japan and impose high tariffs, taxes and duties on it, we are going to pay a lot more to buy that car. The government has too keep that in mind too when they make these regulations. I don't think the intention in importing goods is to make it so expensive that no one can buy it. Companies are not going to want to engage in trade that costs them a lot and reduces their profits either.
That's why trade compliance needs to be somewhere in the middle. Where the government, the consumer and the exporter is happy.
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