New Routed Export 'ERTAs' to Transfer Responsibility From USPPI Directly to FPPI Agent

A long-awaited rewrite of routed export regulations by the Bureau of Industry and Security and the Census Bureau will introduce a new “Export Responsibility Transfer Agreement” (ERTA) to replace the “writing” currently used to transfer filing responsibilities, with the new agreement specifically transferring filing and licensing responsibilities to the forwarder or agent of the foreign party, said Sharron Cook, a BIS senior export policy analyst, during a webcast of the American Association of Exporters and Importers Annual Conference Sept. 3.

Currently, the “writing” required for routed export transactions is an assurance from the foreign principal party in interest that it will assume responsibility for filing and licensing requirements from the U.S. principal party in interest. Trade groups commenting on Census’ advance notice of proposed rulemaking several years ago said the current system leaves the forwarders hired by FPPIs in the lurch, unknowingly saddling them with export compliance responsibilities they may not have the capability to fulfill (see 1712070039).

The new ERTA seeks to address this issue. It would be a document transferring export compliance responsibilities, including those under the Export Administration Regulations and the Foreign Trade Regulations, from the USPPI directly to the FPPI’s forwarder or other agent (such as a consultant or lawyer). The USPPI would be responsible for coordinating the ERTA with the FPPI and the forwarder or agent. “They are the maestro, pulling everything together,” Cook said. For shipments with an ERTA in place, BIS would no longer require a power of attorney for license applications.

Part of the ERTA would be a “U.S. Exporter Certification,” which would certify that the forwarding or other agent “is aware of, capable, and willing to fulfill all applicable requirements of the Export Administration Regulations,” according to the text of the certification as provided by Cook. The certification would ensure that the USPPI and FPPI coordinate and inform the forwarder or agent about their export responsibilities under the EAR, and give the forwarder or agent time to consider whether they are capable and willing to take on the responsibility, Cook said.

Another difference from the current scheme is that, if an ERTA is not in place, the USPPI will retain responsibility for filing and licensing responsibilities for a routed export transaction, rather than the FPPI. In other words, the responsibility for filing and licensing does not change between normal and routed export transactions unless an ERTA is in place. On the other hand, if there is an ERTA in place, the USPPI would no longer be required to keep the Automated Export System filing record. The USPPI would only have to keep records of the export data that it shared with other parties to the transaction.

The routed export rules remain under review by BIS lawyers, where they have been for a “long, long, long, long time,” Cook said. Right now the lawyers are working with the BIS enforcement office to determine how the proposals would affect enforcement. After that, the rules will go to Commerce Department lawyer, which shouldn’t take as much time, and then on to the Office of Management and Budget, where other agencies will get the opportunity to review the rules, including CBP. Officials had been hopeful the regulations would be published in 2020, but recently said 2021 is more likely (see 2006020049 and 2007150044).

“You know how you put things into the oven and you peek at it, and peek at it, to see if it’s done? The regulations are sort of like that,” Cook said. “We’re not sure when they’re done, but when it’s done, we’ll know, and we’ll pull it out.”