Practice Areas: International Transactions

International Trade Regulation & Compliance

In the post-9/11 world, national and homeland security objectives have necessarily become a focal point in U.S. policy. As a result, trade controls have grown in complexity and scope. Increasingly globalized and interdependent, companies in all industries and in all sizes in the world economy are affected by U.S., foreign and international trade controls. Without strategic legal guidance, companies may find themselves unknowingly violating export, import or economic sanctions laws, missing opportunities for duty savings, or facing unfair trade practices. Our goal at McGuireWoods is to facilitate transactions for our clients and help them navigate through this ever changing legal environment as seamlessly as possible by clarifying the law to enable informed decision-making and preventing or mitigating against export, import and sanctions violations so that their business run smoothly and profitably.

U.S. Government Relations: The dynamic nature of international trade regulations are inextricably linked to changes in the national and foreign policy of the United States. Our Washington, D.C. office is uniquely positioned to offer our clients access to the intricacies of Federal Government policy and law making and the tools they need to achieve their goals. Often partnering with our subsidiary McGuireWoods Consulting, LLC, we are able to provide our clients with customized services focused on providing creative insight and initiatives to meet their needs.

Export Controls and OFAC Sanctions: The U.S. government places various rules and restrictions on both U.S. and foreign companies which fall within its jurisdiction. Export regulations are primarily administered by the Department of Commerce under the Export Administration Regulations (EAR), the Department of State under the International Traffic in Arms Regulations (ITAR), and the Nuclear Regulatory Commission and Department of Energy under the Atomic Energy Act (AEA). Economic sanctions and embargoes are administered by the Department of Treasury’s Office of Foreign Assets Controls (OFAC) under various country-specific and subject-based regulations. A significant percentage of U.S., as well as certain foreign-made goods, technology, and services are subject to U.S export regulations. There are also circumstances where foreign trade controls also become applicable. We provide our clients with strategic services in the following areas:

• Classification and Licensing: In order to identify applicable export controls, we help our clients develop and maintain product matrixes, as well as facilitate self-classification or the submission of commodity classification or jurisdiction requests to the U.S. government where advisable. By doing so, our clients are able to operate with greater certainty that the applicable agency laws have been identified and followed.
• Compliance Policies, Practices and Procedures: Many of our clients have or need help developing import and export compliance policies, programs and procedures. At McGuireWoods, we have a highly experienced team of attorneys who can assist in designing, updating, auditing, or improving compliance programs and training personnel.
• Risk Assessment and Mitigation: Whether planning to engage in a particular transaction or corporate policy decision concerning where to do business or with whom to do business, our clients often seek guidance on whether the transaction or decision would result in a violation or increased risk of violation of export control and sanctions laws. We provide guidance and strategic advice based on product and destination based controls as well as end-user and end-use based controls to provide clear and dependable advice focused on avoiding and reducing export compliance risk.
• Enforcement Defense and Voluntary Self-Disclosures: Significantly increased civil and criminal penalties for export violations, as well as expanded enforcement budgets for various agencies, have resulted in increased voluntary self-disclosures (VSD) from companies as well as enforcement actions from the government. Today, civil penalties can be as high as $250,000 per violation without any mitigation from the government. As a result, many companies are looking to voluntarily disclose potential violations to the appropriate government agency in order to obtain mitigated penalties and to avoid government-initiated investigations which are more likely to result in denial of export privileges or incorporation onto restricted party lists in addition monetary fines. We help our clients conduct internal audits and investigations focused on identifying suspected violations, prepare VSD’s for submission to the government and negotiate with the government for the best possible result. We also defend our clients in administrative proceedings and litigation associated with export control violations.

Customs: Controls on the import of goods into the U.S. are administered by U.S. Customs and Border Protection (CBP or Customs) as well as by U.S. Immigration and Customs Enforcement (ICE). Without proper product and country of origin classifications or identification of eligible preference programs, companies often pay higher duties than they should have to and risk being in violation of U.S. and foreign customs laws. At McGuireWoods, we strive to provide our clients with cost-saving, risk-reducing advice in a timely and effective manner. We provide our clients with strategic services in the following areas:

• Tariff Classification and Appraisement: Proper tariff classification and appraisement are essential elements for any company looking to maximize their potential for duty savings. They are also essential elements to maximizing customs compliance and thereby reducing the risk of incurring penalties. McGuireWoods works with clients in structuring transactions to reduce duties. This often takes place in conjunction with the client’s tax advisors.
• Duty Reduction Programs: When utilized properly, today’s proliferation of preferential trade programs open the door to great cost savings and an opportunity for companies to stay ahead of their competitors. Whether it’s NAFTA, CAFTA, the U.S.-Singapore Free Trade Agreement, or another one of the multitude of duty reduction programs, our experienced counsel help ensure that our clients are receiving the most preferential treatment they are entitled to.
• C-TPAT Certification: Although CBP’s Customs-Trade Partnership Against Terrorism (C-TPAT) program, which asks businesses to ensure the integrity of their security practices by adopting a series of guidelines, was designed to be voluntary, increasingly it has become an essential foundation for companies who need to demonstrate their compliance to Customs. Companies that adopt a security compliance plan under the C-TPAT program are rewarded not only with reduced CBP inspections, but are less likely to face enforcement actions from CBP. Since C-TPAT guidelines are extensive and complex, we can assist clients on identifying and implementing its most salient elements while satisfying Customs criteria on a sound security compliance plan.
• Binding Rulings: Where an importer is unclear as to how customs laws apply to a particular transaction or it benefits an importer to receive affirmation from Customs for a particular interpretation of the laws, a request for an interpretive ruling from CBP is advisable. Upon such a request, Customs will issue a binding ruling which applies to that particular transaction. McGuireWoods assists clients by preparing and submitting interpretive ruling requests to ensure certainty in their transactions.
• Internal Reviews and Prior Disclosures: In the face of customs violations, clients may significantly reduce or eliminate penalty liability through internal reviews and prior disclosures. We stand by to help our clients conduct such reviews and disclosures and, where Customs claims a penalty and no prior disclosure has been filed, we stand by to help mitigate liability to the maximum extend possible.
• Protests and Appeals: McGuireWoods prepares and files challenges to Customs decisions whether at single or multiple ports of entry. These challenges typically take the form of protests, requests for reliquidation, supplemental information letters, or requests for further review. If necessary, the results can also be appealed to the U.S. Court of International Trade.
• Customs Compliance Audits: Customs conducts audits under its focused assessment program which is comprised initially of a Focused Assessment (FA) that can be followed by a more intrusive Assessment Compliance Testing (ACT) process. McGuireWoods stands by to protect its clients as they prepare for and go through a Customs compliance audit, as well as to facilitate self audits geared at maintaining or improving their existing compliance programs with any additional training or advice needed.
• Origin: The determination of the country of origin of imported merchandise is often a complex process. Since origin can affect admissibility, duty rates, preference eligibility, it is crucial that clients understand and apply the principles. McGuireWoods assist clients in these determinations.

Anti-boycott: U.S. anti-boycott regulations, administered by the Office of Anti-boycott Compliance, imposes certain prohibitions and reporting requirements on U.S. companies and in many instances their foreign subsidiaries, relating to boycotts administered by other countries which discriminate based on race, religion, sex, national origin or nationality. Most notably, these restrictions and reporting requirements are relevant when companies transact with countries that are a part of the Arab League Boycott against Israel. McGuireWoods has substantial experience advising companies on prohibited conduct as well as reporting requirements. We also provide training for our clients where needed.

Foreign Direct Investment: The interagency Committee on Foreign Investment in the United States (CIFIUS) administers certain reviews and restrictions, known as Exon-Florio reviews, on foreign investment, merger, and acquisition activity with foreign companies. Restrictions imposed by CIFIUS can limit the amount of investment or financing allowed, as well as impose various additional transactional requirements. Proper counsel early on can help ensure more timely completion and more favorable commercial terms in the given business transaction.

Foreign Corrupt Practices Act: The Foreign Corrupt Practices Act (FCPA) makes it unlawful of U.S. persons to bribe foreign government officials in order to obtain or retain business. Both individuals and corporations are subject to substantial fines, and suspension or debarment from Federal procurement. Employees and corporate officers are also subject to imprisonment. In addition to our Government, Regulatory and Criminal Investigations practice area, which represent clients under government investigation, including FCPA violations, our International Trade Regulation & Compliance practice area focuses on FCPA issues from the prophylactic perspective, helping our clients avoid FCPA violations by designing and improving compliance programs, providing training, as well as transaction-specific advice on FCPA requirements.

Trade Remedies: Our international trade attorneys have experience in both prosecuting and defending anti-dumping and countervailing duty (AV/CVD) proceedings. McGuireWoods also assists importers and purchasers potentially facing trade remedy measures.

International Consumer Product Safety: Triggered by the large-scale recalls of imported toys with lead paint and other hazards, the recently enacted Consumer Product Safety Improvement Act of 2008 (CPSIA) is the most comprehensive overhaul of consumer product safety laws since 1972. Under the CPSIA, the Consumer Product Safety Commission (CPSC) and U.S. Customs and Border Protection (CBP) are charged with developing new regulations, procedures, and standards concerning imported and exported consumer products. As an increasingly large portion of consumer products sold in America are manufactured overseas, the CPSIA and ensuing regulations will have a significant impact on manufacturers of imported consumer products as well U.S. manufacturers of consumer products. McGuireWoods has the expertise to help represent client interests as new regulations and standards develop as well as to help client comply with new requirements in this arena.