Page 8 - CCCA Magazine Winter 2017

{ iNterNatioNal trade }

using trAde Agreements to gAin A Competitive

edge in tHe gloBAl mArketplACe

By Heather Innes, CIC.C

is your organization looking to remain competitive domestically ings for your organizations and your cus-

and globally? Upcoming and ongoing changes to international tomers, creating a competitive advantage.
Note that some FTAs also permit pref-
trade agreements—which may impact your organization’s erential access for professionals, highly
growth strategy—will either help or hinder you, depending on skilled individuals and intra-company
transfers. Using these provisions can facil-
how knowledgeable and prepared you are. itate the movement of critical personnel.
In addition, certain newer FTAs in-
clude provisions that call for increased
hether it be the re-negotiation of ucts and services you import from other regulatory harmonization, standards
the North American Free Trade countries and for which you pay prefer- testing recognition, transparency and
WAgreement (NAFTA), changes to ential duties today. This represents your consultation. If applicable, you may
U.S. trade policies or the U.K.’s decision to current duty cost baseline, which could be able to use testing completed in one
leave the European Union (BREXIT), to change if there are changes to the prefer- country to satisfy certain standards test-
name only a few, the dynamics of interna- ences or to the defnition of what qualifes ing requirements in a destination coun-
tional trade signifcantly impact the suc- for duty preferences (i.e., changes to the try, reducing your compliance costs,
cess of your business and its bottom line. rules of origin). again providing for opportunities to re-
They affect how your client does business, Equally important is to understand duce costs.
the risk associated with current business the duty treatment currently applied to Make sure internal processes are in
models, global expansion opportunities products and services you export to other place to monitor your activities, report on
and the overall cost of doing business. countries. Changes to their import duty imports and exports accurately, and col-
To best serve your client as in-house preferences could impact your costing lect and maintain the required supporting
counsel, you need to understand and re- structure as well as that of your current documentation and certifcations. Con-
main up to date on the applicable trade and potential customers. If your organi- sider adding contractual obligations for
laws and free trade agreements (FTAs) so zation is large and this seems overwhelm- suppliers and purchasers to provide the
you can help your organization manage ing, focus on some of your larger opera- documentation, certifcations and sup-
the challenges associated with interna- tions or high-priority operations frst. port you may need from them now and in
tional trade, seize global opportunities and the future (e.g., in the event of a govern-
outperform the competition. If you adopt 3. verify that your organization is tak- ment audit or verifcation).
a wait-and-see approach or fail to prepare ing full advantage of the available Ftas. Also use this time to explore new mar-
your client for upcoming changes, the neg- Review the applicable rules of origin re- ket opportunities that may already exist.
ative consequences could be signifcant. quirements to determine whether your Are there other markets to which your
So what can you do to best position imports and/or exports qualify for low- fnished goods could be exported duty
your business? Here are some steps to get er duty rates. If they do qualify and your free under an existing FTA? Or is there
you started. organization is not taking advantage of an FTA under negotiation that should be
the lower (often zero) duty rate, why factored into your organization’s plan-
1. identify where your organization does not? Are you missing the certificates ning activities?
business. Map out the countries in which of origin or other documentary proof
you have operations, those from which of origin required to secure the lower 4. be ready for change. There are many
you source inputs and those to which you rate? If so, you should work with your regional trading agreements under nego-
sell your products or services. purchasing team to obtain the required tiation and several under re-negotiation.
support from your suppliers. Organizations that understand the cur-
2. identify the Ftas that may apply to your If they do not qualify, look at why. Mod- rent rules, proactively seek to infuence
current footprint and sourcing patterns. ifying your processes and working with or changes and plan for the most likely out-
Work with your customs and purchasing changing suppliers to meet the require- comes will be the winners. Have systems
representatives to understand the prod- ments may result in signifcant duty sav- in place to monitor key FTAs and sched-

8 CCCa MaGazine | WinTer 2017 hiVer