Raymond Yang

There are many standard methods of paying for imports, each with its own associated monetary costs and risks. Four common options, ranging from most secure (to you, the importer) to most risky (which will be the most secure to your exporting counterpart) are open account, documentary collection, letters of credit, and cash in advance. Typically, a larger local bank (with its own international trade services department) can help you through the process.

The Secretary of Commerce has delegated the authority for enforcing the FTR to the Department of Homeland Security’s Customs and Border Protection and Immigration and Customs Enforcement, as well as the Department of Commerce’s Office of Export Enforcement. These agencies determine penalties for violations of the FTR. Subpart H of the FTR outlines the penalty provisions.

The first step of entering a new market is conducting market research. This includes assessing the current market situation, its size and trends, how strong the competition is and what are the laws and regulations that you will need to comply with. One of the best market entry strategy is direct exporting . Choosing direct exporting may be a foreign market entry strategy that’s right for your company when you have a unique offering with strong customer appeal and have adapted it to match your targeted international market. When you direct export, you can achieve higher profits without a middleman. Exporting allows a company to enter many markets at the same time without much capital investment. Plus, you will gain complete control over your transactions and be able to establish close relationships with your customers. If entering a new international market poses challenges, such as language barriers, cultural differences or unfamiliar ways of doing business, it may be better to choose indirect exporting via intermediaries who know the local market much better. They can help you find customers, arrange distribution channels, handle documentation, clear your goods through customs and provide after-sales service.

In order to secure the United States from terrorism attacks US Customs Service created the Container Security Initiative (CSI). The primary purpose of CSI is to protect the global trading system and the trade lanes between CSI ports and the US Under the CSI programme, a team of officers is deployed to work with host nation counterparts to target all containers that pose a potential threat. Announced in January 2002, CSI was first implemented in the ports shipping the greatest volume of containers to the United States. Today, customsadministrations all over the world have committed to joining CSI and are at various stages of implementation. CSI is now operational at ports in North, Central, and South America, the Caribbean, Europe, Africa, the Middle East, and throughout Asia. CSI uses a security regime to ensure all containers that pose a potential risk for terrorism are identified and inspected at foreign ports before they are placed on vessels destined for the United Sates. Through CSI, CBP officials work with host customs administrations to establish security criteria for identifying highrisk containers. Those administrations use non-intrusive inspection (NII) and radiation detection technology to screen high-risk containers before they are shipped to US ports.

An irrevocable letter of credit (ILOC) is an official correspondence from a bank that guarantees payment for goods or services being purchased by the individual or entity, referred to the applicant, that requests the letter of credit from an issuing bank. An irrevocable letter of credit cannot be canceled, nor in any way modified, except with the explicit agreement of all parties involved: the buyer, the seller, and the issuing bank. For example, the issuing bank does not have the authority by itself to change any of the terms of an ILOC once it is issued. ILOCs are most commonly used to facilitate international trade. Due to the nature of international dealings, including factors such as distance, differing laws in each country, and difficulty in knowing each party personally, the use of letters of credit has become a very important aspect of international trade. Although an ILOC is irrevocable while it is in force, generally the time period during which a proposed transaction is expected to be completed, an ILOC expires at a specified point in time, which is noted in the letter of credit.