07.29.2009 Playing It Safe: Staying Ahead of the U.S. Business Regulation Curve Ball
07.29.2009If there ever is a time that companies should tread carefully on the landscape of regulatory compliance, it is during economic downturns. When the economy goes bad, companies tend to adopt aggressive revenue building initiatives. This includes seeking new foreign markets and business contacts, taking on new product lines, and adding new sales representatives or distributors. Yet, each of these options involves some degree of government regulation. If these are not followed carefully, the magnitude of the resulting civil fines, criminal penalties, or bad publicity would make the negative effect of the current economy pale in comparison.
Government enforcement activity involving international trade in goods and services is on the rise, and the regulations are becoming more complex. However, by asking a few simple questions, companies can take the first important steps towards full compliance.
Are geographical restrictions involved? The U.S. maintains trade embargoes, sanctions and other forms of trade restrictions affecting a number of countries. A quick check will reveal if your current or intended business plan market involves special geographical rules.
Is my product (or service) of special interest to the government? Most goods and services hold no special regulatory interest, but there are still a significant number that do. Think in terms of computers and military and then keep in mind that the devil is in the detail. You need to be absolutely sure that your product is not subject to special registrations, licenses or other regulations in order to export. Services are also subject to registrations and licenses. Remember that providing a service here in America could be deemed an export when you least expect it.
Who are you doing business with? Before signing the bottom line, check the names of individuals and companies against readily available government databanks. It’s easier to dispose of a customer or sales representative than a government investigation.
Build and maintain trade compliance. This is not a question, but a key strategy. Secure the future of your business by adopting a trade compliance program suited to your size and business expectations.
For more information, please contact Jimmie V. Reyna, 202.293.8128, .
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