Import & Export Compliance: Key Regulations and Best Practices

For procurement and supply chain teams navigating global trade, compliance isn't optional but should be an operational component which is constantly referred back to. From avoiding costly fines and shipping delays to protecting your business reputation, understanding the rules around import and export is a must.

But here's the challenge: trade regulations aren't just complex, they're constantly changing and can be difficult to keep up with. Whether you're dealing with the U.S. Export Administration Regulations (EAR), the International Traffic in Arms Regulations (ITAR), or managing shifting global sanctions, the margin for error is small. And when compliance ownership is scattered across teams, things can slip through the cracks.

This guide breaks down the essentials, as we'll cover key U.S. and global regulatory frameworks, outline the components of a strong compliance program, and provide a practical checklist to reduce risk and streamline your operations.

Whether you're looking to improve internal training or build a scalable, audit-ready process, you'll walk away with a clearer, more confident approach to global trade compliance.

Key Takeaways: Import Export Compliance in the US

• Import and export compliance is high-stakes. Fines, delays, and operational risk can result from even small errors, especially for global teams with fragmented ownership.
• Understand the regulatory frameworks. EAR and ITAR govern U.S. exports; CBP enforces import rules; OFAC manages sanctions. Knowing who regulates what is step one.
• Classification is critical. Assigning the correct HTS and ECCN codes is the foundation of compliance and a common source of error.
• Restricted party screening must be routine. Every transaction should be screened against updated denied party lists and documented for audit purposes.
• Documentation drives defensibility. Invoices, licenses, origin certificates, and EEI filings must be complete, accurate, and retained for at least five years.
• Automation reduces risk. Digital tools can streamline classification, screening, and document control, especially at enterprise scale.
• Training should be role-specific and ongoing. One-size-fits-all training doesn't work. Tailor content to buyers, logistics staff, and leadership to build lasting compliance capabilities.
• A structured program is a strategic advantage. Compliance isn't just risk management; it improves efficiency and trust across your supply chain.

Why Import Export Compliance Matters

Trade compliance isn't just a legal box to check, but a business-critical function. For global procurement and supply chain teams, the consequences of getting it wrong are immediate and costly.

The business risks of noncompliance

Fines, shipment delays, product seizures and reputational damage are the real outcomes of compliance missteps. In the U.S., violations of the Export Administration Regulations can result in civil penalties of up to $300,000 per violation or twice the value of the transaction, whichever is greater.

And yet, many teams still operate with fragmented ownership over trade compliance. One department manages documentation, while another handles logistics and then legal steps in only when something breaks. The result? Gaps which are often hidden until it's too late.

Real-world examples of trade violations

Trade violations could include anything from shipping dual-use items without proper classification to exporting goods to embargoed countries due to outdated screening protocols.

In the fiscal year of 2024, BIS (Bureau of Industry and Security Export Enforcement) said its investigations led to the criminal conviction of over 65 individuals and businesses for export violations with penalties of nearly $5 million in criminal fines, nearly $3 million in forfeitures, over $15 million in restitution and over 3,100 months of imprisonment.

Compliance as a driver of operational efficiency

When done right, trade compliance doesn't just prevent problems but improves performance. Clear documentation, structured processes, and trained teams can reduce shipping delays, avoid rework, and improve supplier trust. It's not about playing defense, it's about enabling smoother, faster and more secure operations.

Key Regulatory Frameworks in the U.S. and Globally

Global trade compliance isn't governed by a single rulebook, but it includes a layered mix of national laws, international agreements, and sector-specific restrictions.

For U.S.-based organizations, the complexity often starts with export and import regulations, but it doesn't end there.

U.S. export controls

In the United States, the Department of Commerce's Bureau of Industry and Security (BIS) looks after the laws, regulations and policies relating to the export and reexport of commodities, software and technology which fall under the jurisdiction of the Export Administration Regulations (EAR).

There are two primary regulatory regimes which you should be aware of when looking at export compliance: the Export Administration Regulations (EAR) and the International Traffic in Arms Regulations (ITAR).

• EAR, managed by the Bureau of Industry and Security (BIS), covers most commercial items with potential dual-use (civilian and military).
• ITAR, overseen by the Directorate of Defense Trade Controls (DDTC), applies to defense-related articles and services.

The issue, however, is that many teams don't know which regulation applies or assume EAR and ITAR are interchangeable. They're not, and misclassifying a product or failing to secure a proper license can lead to multimillion-dollar penalties and revoked export privileges.

U.S. import rules

On the import side, compliance falls under U.S. Customs and Border Protection (CBP). Key requirements include:

• Accurate product classification using the Harmonized Tariff Schedule (HTS)
• Valuation and country of origin declarations
• Compliance with quotas, licenses, and anti-dumping laws

Getting these wrong isn't just a paperwork issue; it can delay goods at the border, incur costly penalties, or trigger audits.

Sanctions and restricted party screening

All organizations involved in cross-border trade must comply with U.S. sanctions administered by the Office of Foreign Assets Control (OFAC). This means checking customers, suppliers, and logistics providers against restricted party lists before engaging in any transaction.

Screening isn't a one-time task; it needs to be embedded in workflows and automated where possible.

Global compliance considerations

Outside the U.S., similar, but not identical, frameworks exist. The European Union enforces its own dual-use regulations. China, the UK, Canada, and others maintain export controls, customs rules, and sanction lists.

For global companies, this patchwork creates risk. A centralized policy is essential, but local expertise is non-negotiable, and your compliance program needs both.

What Belongs in a Trade Compliance Program

A trade compliance program isn't just a policy document; it's a framework that touches every part of the supply chain. For enterprise teams, it must scale without relying on a single person or department to "own" compliance in isolation.

Governance and internal ownership

First: define who's accountable? Many compliance failures stem from unclear ownership. Your program needs a governance structure with defined roles across procurement, logistics, legal, and leadership.

Appointing a Global Trade Compliance Manager or equivalent can help centralize responsibility while still embedding compliance in daily operations. It's important that those involved are aware of each person's responsibilities, so they can direct communication to them when an issue occurs.

Clear internal policies, aligned with external regulations, ensure that everyone, from buyers to warehouse teams, knows the boundaries and their role.

Risk classification and product controls

Every product you import or export must be classified correctly:

• For exports: Determine if your product is subject to EAR or ITAR. Assign an ECCN (Export Control Classification Number) by looking at the Commerce Control List or confirm it falls under EAR99 (non-controlled items). Even if an item isn't on a specific list, it may still require a license.
• For exports: The order or review requires jurisdiction determination to review the USML first, then the CCL to properly classify the product. This paragraph is more inclusive and does not assume the jurisdiction will always be EAR.
• For imports: Classify goods using the Harmonized Tariff Schedule (HTS), and identify applicable duties or trade remedies. HTS sets out the tariff rates and statistical categories of imports.

Risk also varies by destination country, end user and intended use. A strong compliance program includes a risk-based approach to controls, flagging high-risk transactions for added due diligence.

Party screening, due diligence, and KYC

Restricted party screening isn't optional, and every transaction should include checks against denied party lists (e.g., OFAC's SDN List, BIS Entity List, among others). But effective programs go further, conducting Know Your Customer (KYC) can help you to validate the legitimacy and compliance standing of partners.

If you're relying on spreadsheets or manual lookups, you're increasing both error rates and time-to-ship.

Documentation, training, and audits

If it's not documented, it didn't happen. Your compliance program must include aspects like:

• Document retention policies aligned with U.S. CBP and BIS rules (typically 5 years minimum)
• Training programs tailored by role (buyers, logistics staff, execs)
• Regular audits to identify gaps, test controls, and respond to regulatory changes

Training, in particular, is often overlooked. A one-time webinar won't cut it. Teams need ongoing, role-specific learning to stay compliant in a shifting regulatory environment.

Import Export Compliance: Documentation Requirements

Documentation might seem like admin work, but it's often the first thing regulators ask for in an audit. Missing, incomplete, or inconsistent paperwork can derail shipments, trigger fines, or expose gaps in your entire compliance program.

What documents are mandatory and when

Import and export documentation varies based on product, country and transport mode. That said, some core documents are almost always required:

• Commercial invoice – Lists the buyer, seller, and product details
• Packing list – Breaks down shipment contents
• Bill of lading (BOL) or air waybill (AWB) – Serves as the transport contract
• Certificate of origin – Verifies where goods were made
• Import/export licenses – Required for controlled items
• Electronic Export Information (EEI) – Filed via AES for certain U.S. exports

Missing even one of these can delay customs clearance or worse, result in seizures or investigations.

Managing licenses, certificates, and declarations

Certain goods, like dual-use technologies or pharmaceuticals, require pre-approval through licenses or declarations. Depending on the item, it's important you check your individual circumstances to clarify what you may need. These may include:

• Export licenses under EAR or ITAR
• FDA certificates for regulated imports
• Customs declarations with harmonized codes and proper valuation

Effective compliance programs track expiration dates, maintain version control, and ensure that license conditions are followed across transactions, not just when first issued.

How to avoid paperwork errors and delays

Here's where many teams trip up:

• Reusing old templates without verifying current data
• Manually entering HS codes or ECCNs
• Relying on freight forwarders without cross-checking documentation

Avoid these risks by centralizing documentation in a compliance system, automating data pulls from ERP systems, and training staff on how and when to review paperwork.

Documentation isn't just about checking boxes; it's about maintaining a clear, auditable trail that protects your organization.

Common Compliance Pitfalls to Avoid

Even well-intentioned teams can fall short when trade compliance isn't built into daily processes. These missteps aren't just operational headaches; they're regulatory liabilities. Here's where companies most often get it wrong.

Misclassifying goods or misinterpreting regulations

Product classification is the foundation of compliance, but it's easy to get wrong. One incorrect HTS or ECCN code can lead to:

• Incorrect duty payments
• Delayed shipments
• Invalid or missing export licenses

And when teams confuse regulatory frameworks, like treating EAR and ITAR as interchangeable, the consequences escalate. This is why it's important to be aware of exactly what is required of you. Set up clear classification workflows, use government databases for lookups, and have a compliance expert verify high-risk or controlled items.

Skipping or mismanaging screening

Restricted party screening should happen before any transaction, not simply be an afterthought. Common mistakes include:

• Skipping re-checks when re-exporting or shipping to a new location
• Using outdated or incomplete watchlists
• Failing to document when and how screening occurred

In the U.S., violations are strict liability. That means intent doesn't matter; you're responsible either way. Solution: Automate screening and log every result.

Failing to keep accurate records

Recordkeeping is where many compliance programs collapse under scrutiny. Missing, duplicate, or conflicting records can invalidate your compliance defense even if you followed the rules.

Examples:

• Using different product values on commercial invoices vs. customs declarations
• Storing licenses in siloed email threads
• Not retaining documentation for the full required period (typically five years)
• Solution: Standardize digital storage, implement naming conventions, and run periodic audits.

Trade Compliance Checklist & Implementation Plan

Building a trade compliance program from scratch, or tightening up an existing one, can feel overwhelming but with a clear roadmap, teams can move from reactive to resilient. Here's a practical framework to implement and scale compliance across your organization.

Step-by-step plan to build your compliance program

1. Assign ownership: Designate a compliance lead or committee that includes procurement, logistics, legal, and IT. Clarify roles and escalation paths.
2. Map current processes: Identify where compliance steps live today, classification, screening, documentation, and where gaps or overlaps exist.
3. Define policies: Develop formal policies covering import/export classification, screening protocols, license management, and documentation standards.
4. Select compliance tools: Choose software or platforms to centralize documentation, automate screening, and track training completion.
5. Train teams: Deliver role-specific training that's relevant to each function, not just a one-size-fits-all overview.
6. Run an internal audit: Test your controls, verify documentation trails, and flag any weaknesses.
7. Launch, review, and refine: Compliance isn't static. Set quarterly reviews, track incidents, and adjust for regulatory changes.

Checklist items for import and export workflows

Import:

• HTS codes validated and documented
• Country of origin documented
• Free Trade Agreement eligibility assessed (if applicable)
• Supplier declarations collected
• Anti-dumping/countervailing duties checked
• Import licenses (if applicable) obtained
• Customs broker instructions confirmed and POA
• Entry documents prepared and stored

Export:

• Jurisdiction determination completed and documented
• Classification confirmed and documented
• Destination and end-use, and end-user screened
• License or license exception applied
• Restricted party screening logged
• AES filing completed for EEI (if required)
• Routed export transactions managed
• Shipping documentation verified

Each item on this checklist connects to a specific compliance obligation, often enforced by different regulatory bodies. While the steps may feel procedural, checking them off can help protect your business on multiple fronts.

For instance, validating the country of origin isn't just about transparency; it can impact whether your shipment qualifies for Free Trade Agreements or triggers anti-dumping reviews. And throughout it all, maintaining strong recordkeeping is an absolute must, as this provides proof should an audit take place.

Metrics to monitor compliance effectiveness

Compliance can't be managed if it isn't measured. Key indicators include:

• Number of documentation errors flagged per shipment
• Screening failure rate (e.g., blocked or flagged parties)
• Time from shipment creation to license approval
• Training completion rates by role and region
• Audit pass rate or number of findings

These aren't just KPIs, they're early warning signs. Use them to identify trends, prioritize training, and prove program impact to leadership.

Best Practices for Staying Compliant

Compliance isn't a one-and-done task; it's a living, evolving capability. The most resilient organizations treat it like a core business function, not just a regulatory requirement. Here's how high-performing teams stay ahead.

Embed compliance into procurement and supply chain processes

Compliance shouldn't live in a silo, which is a common issue as many organizations treat trade compliance as a standalone function. Instead, it needs to be baked into everyday decisions from sourcing and supplier selection to shipping and delivery.

• Procurement teams should verify supplier documentation and country-of-origin data during onboarding.
• Supply chain teams should confirm product classifications and license requirements before finalizing shipments.
• Contracts should include trade compliance clauses to protect your organization if a partner fails to comply.

When compliance is part of the process, not an afterthought, risk drops and efficiency improves.

Leverage digital tools and automation

Manual compliance workflows are a liability. Automation doesn't just save time; it reduces human error and strengthens your audit trail.

Smart organizations use tools to:

• Auto-check restricted party lists in real time
• Validate product codes and licenses against databases
• Centralize documentation across departments
• Trigger alerts for expiring licenses or incomplete filings

If your team is still chasing emails and spreadsheets, it's time to modernize. Digital compliance is scalable compliance. For example, if you're launching a new product, tools can flag export controls. Or if you're being audited by a regulator, you can produce a full documentation trail in minutes.

Keep teams trained on the latest regulations

Trade laws change fast and they're certainly not static. Sanctions can appear overnight and licensing requirements shift with new technologies and geopolitical events.

Yet many organizations rely on outdated training models whether that be a single annual webinar, a basic slide deck, or generalized compliance briefings not tailored to job roles. This approach leaves critical gaps especially for distributed teams, high-risk categories, or new hires. That's why ongoing role-based training is non-negotiable. But it needs to be:

• Role-specific – A logistics coordinator needs different knowledge than a procurement manager.
• Interactive – Simulations and real-world scenarios drive retention.
• Measurable – Track completion rates, knowledge gains, and behavior change over time.

Turning Compliance into a Competitive Advantage

Import and export compliance isn't just about avoiding fines or ticking regulatory boxes. For enterprise supply chain and procurement teams, it's a strategic capability.

When you classify goods correctly, screen effectively, and train your teams to spot risks early, you're not just staying compliant but enabling smoother operations and stronger supplier relationships.

The real edge? Turning compliance into a business enabler. With the right tools, workflows, and training in place, you reduce friction across your supply chain. You close audit gaps before they become liabilities, and you build trust with regulators, partners, and customers alike.

At Skill Dynamics, we help global teams embed compliance where it matters most: in daily decisions, operational processes, and frontline performance. Because when your team is confident in the rules, they move faster and smarter. Contact us today to get started.

FAQs

Do I need a license to export commercial goods?

Many commercial goods fall under EAR99, which is generally considered low-risk. However, EAR99 does not guarantee that a license isn't required. Licensing still depends on the ECCN, destination country, end use, and end user.

Even low-risk items may require authorization under U.S. export controls, including BIS (EAR) licensing and OFAC licensing, particularly when shipping to sanctioned countries or restricted parties. In practice, only around 5% of U.S. exports require a license, but screening and classification are still essential.

What's the difference between EAR and ITAR?

EAR (Export Administration Regulations) applies to dual-use items, goods with both commercial and military applications. It's managed by the Bureau of Industry and Security (BIS).

ITAR (International Traffic in Arms Regulations) governs defense articles and services. It's managed by the Directorate of Defense Trade Controls (DDTC) and is far more restrictive.

How long should I retain trade documentation?

The general rule under U.S. export and customs laws is a minimum of five years from the date of the transaction or export. This applies to invoices, shipping records, licenses, classification justifications, screening logs, and related correspondence. Retaining this documentation is critical for audits and investigations.

However, an Interim Final Rule was introduced in 2024 that expanded the required recordkeeping time to 10 years for certain exports.

What's a restricted party list, and how do I use it?

Restricted party lists are databases of individuals, entities, and countries your organization is prohibited from doing business with due to national security, sanctions, or trade control laws.

Major lists include, but are not limited to:

• OFAC's Specially Designated Nationals (SDN)
• BIS Entity List
• ITAR Debarred List

You must screen all parties (buyers, suppliers, freight forwarders) before shipping and re-screen periodically.

What tools can help with trade compliance?

Leading compliance teams use digital tools for:

• Real-time restricted party screening
• Automated product classification
• License tracking and alerts
• Document storage and audit trails
• Integrated training platforms

Look for solutions that integrate with your ERP or procurement systems and provide reporting for compliance metrics.

How can I tell if a product is export controlled?

Start by classifying it:

1. Confirm whether the item is ITAR-controlled under the U.S. Munitions List (USML).
2. If it's not ITAR-controlled, check the ECCN via BIS's Commerce Control List.
3. If it's not listed, it may fall under EAR99.
4. Consider the end use and end user, this can elevate the risk.
5. Use the BIS SNAP-R tool or consult a trade attorney if unsure.

Controlled doesn't always mean license-required, but classification is the critical first step.