Why should you be concerned about export controls and economic sanctions?
A wide range of activities across business sectors can be affected by export controls. The risk is high where companies believe their products or services only have a civilian use and fail to look closely at the information published by governments describing characteristics which would make regular civilian items export controlled.
Businesses that operate in the following sectors are commonly affected by these restrictions:
- High Tech
- Natural Resources and Utilities
- Materials processing
- Biosciences and Pharmaceuticals
- Aerospace and Defence
Non-compliance can result in severe financial and criminal penalties, as well as reputation-affecting public censure.
In addition to national regulations, businesses in the European Union can also be affected by extra-territorial laws of other countries, such as the USA. This can further complicate compliance and open the business up to non-compliance penalties from multiple governments. For example, in 2010 a UK Plc was fined US $15 million by the US government for breaches of US re-export controls.
Inadequate or inefficient management of export controls and economic sanctions can also lead to:
- delays in the speed of supply to customers
- expending significant resources in order to comply with the restrictions in place
- the need to manage increased, time-consuming oversight by government authorities (whether in the form or visits and audits or additional checks being made at customs)
How can we help you?
KPMG’s Export Control Services team can assist you in safeguarding your business against the future costs of non-compliance.
This includes supporting you in alleviating not only the financial cost of compliance but also the time cost. In the current market, where businesses need to prosper to survive, having valuable internal resources unduly engaged in time-consuming compliance activities can be counter-productive.
Streamlining your compliance activities can also make your supply chain more efficient and effective, reducing your cost and time to serve. Our services can also help you demonstrate leading practice compliance, which can give you the edge over competitors, where prospective private or public sector customers are focussed on ensuring that their supply chain partners can provide good continuity of service.
We have a team with multi-country, practical experience in managing export controls and sanctions and in dealing with government departments to support efficient and effective compliance within our clients’ supply chains. We have broad experience in dealing with these issues across a wide range of business sectors.
KPMG are able to offer our clients end-to-end programmes, which include not only providing advice on the export controls and economic sanctions restrictions in place but also helping to practically comply with these.