What is trade compliance?

Trade compliance is the practice of ensuring that all cross-border movement of goods, software, and technology follows applicable laws — covering both imports (classification, valuation, duties, admissibility) and exports (licensing, controls), as well as sanctions screening and forced-labor prohibitions.

What is the difference between trade compliance and customs compliance?

Customs compliance focuses on the import side — classification, valuation, origin, duties, and CBP recordkeeping. Trade compliance is broader, adding the export side (export controls under EAR/ITAR), sanctions (OFAC), and forced-labor rules (UFLPA). Customs compliance is a major component of overall trade compliance.

What are export controls (EAR and ITAR)?

Export controls restrict the export of certain goods, software, and technology. The Export Administration Regulations (EAR), administered by the Commerce Department’s BIS, cover most commercial and dual-use items; the International Traffic in Arms Regulations (ITAR), administered by the State Department, cover defense articles. Controlled exports may require a license.

What is sanctions screening?

Sanctions screening is checking the parties you transact with against government restricted-party lists — chiefly OFAC’s Specially Designated Nationals (SDN) list and BIS’s Denied Persons and Entity Lists — to ensure you are not dealing with a prohibited person or entity.

Who is responsible for trade compliance in a company?

Legal responsibility rests with the company itself — on the import side, with the importer of record. Larger companies often have a dedicated trade-compliance function, but the obligation to exercise reasonable care and screen counterparties applies regardless of company size.

How do companies manage trade compliance?

Through documented procedures, restricted-party and supplier screening, accurate classification and valuation, license determination for exports, recordkeeping, and periodic audits — increasingly automated with software so screening and monitoring run continuously rather than periodically.

Guide

Trade compliance

Trade compliance spans both sides of cross-border commerce — imports and exports — plus sanctions screening and forced-labor rules. This guide maps the landscape and where each obligation sits.

What trade compliance covers

Trade compliance is the umbrella discipline for moving goods, software, and technology across borders lawfully. It is broader than customs compliance (which is the import side) — it also covers exports, sanctions, and forced-labor prohibitions.

Import controls →

Classification, valuation, origin, duties, and admissibility for goods entering the country.

Export controls

Licensing and restrictions under the EAR (Commerce/BIS) and ITAR (State) for controlled goods, software, and technology.

Sanctions screening

Checking parties against OFAC (SDN) and BIS (Denied Persons, Entity) lists before transacting.

Forced-labor rules →

UFLPA and Section 307 prohibitions on goods made with forced labor.

Trade remedies →

Section 301, 232, and IEEPA tariffs, plus antidumping and countervailing duties.

Recordkeeping →

Retaining the documents that prove compliance, typically for five years.

Import vs. export sides

On the import side, the importer of record classifies, values, and declares goods and pays duty. On the export side, exporters must determine whether an item is controlled under the EAR or ITAR and screen the parties involved. Sanctions screening (OFAC, BIS) applies to both. For importers, the most automatable pieces are classification, supplier screening, tariff monitoring, and duty recovery.

Trade compliance FAQ

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