International trade compliance isn't just a regulatory checkbox—it's your company's shield against devastating penalties and your passport to global market success. With enforcement agencies imposing record-breaking fines and expanding their reach in 2025, understanding trade compliance has never been more critical for U.S. businesses venturing into international markets.
Trade compliance is the process that companies and individuals put into place to adhere to all laws, regulations and procedures governing the import and export of goods and services across international borders. For U.S. companies, this means ensuring every international transaction complies with requirements under the Export Administration Regulations (EAR), the International Traffic in Arms Regulations (ITAR), the Foreign Trade Regulations (FTR) and miscellaneous other U.S. government regulations, as well as the laws of destination countries.
International trade compliance encompasses the entire ecosystem of rules that govern cross-border commerce, including:
Think of trade compliance as the operating system for international business—it runs in the background of every transaction, ensuring your company can trade globally while staying within legal boundaries.
The stakes have never been higher. Recent enforcement data reveals a dramatic escalation in government oversight:
The message is clear: robust compliance programs are no longer optional—they're essential for business survival in the global marketplace.
While often discussed together, export and import compliance involve distinct requirements and risks:
Export compliance focuses on controlling what leaves the United States and where it goes. Key components include:
Companies need to determine which government agency–and which set of export regulations–have jurisdiction over their products. The Commerce Department’s BIS has jurisdiction over most commercial items under the EAR, while the State Department's Directorate of Defense Trade Controls (DDTC) manages defense articles under ITAR.
In order to comply with the FTR, companies must find the correct 10-digit Schedule B or Harmonized Tariff Schedule (HTS) code for their products and, in most cases, report that data to the U.S. Census Bureau through the Automated Export System (AES). The foreign buyer may also use the first six digits of that code for import clearance.
In addition, companies need to determine if their goods also have an Export Control Classification Number (ECCN) or a U.S. Munitions List (USML) classification code, which is used to determine if an export license is required to ship the goods. While every product will have an HTS or Schedule B code, not every product will have an ECCN or USML classification. However, the only way to know for sure is to search for the correct code.
Shipping Solutions Product Classification Software makes looking for the HTS, Schedule B, ECCN and USML codes easy by allowing you to enter a brief description of the goods. You can try it out for yourself by signing up for a free trial subscription.
A number of U.S. and other government agencies publish lists of individuals, companies and organizations with whom it is illegal to do business. While there is no requirement to run restricted party screenings of all the parties in an export transaction, there is no other reliable way to ensure compliance.
The International Trade Administration (ITA) publishes the Consolidated Screening List that includes parties from the largest U.S. government lists:
In most cases the Consolidated Screening List works fine for most exporters in most situations. However, keep in mind that it does not include all of the more than 200 U.S. lists and none of the foreign government or international agency lists. And the Consolidated List is not always reliably updated. See this recent notice on the ITA website:
We are aware that there is an issue with the Consolidated Screening List’s Application Programming Interface (API) functionality, which includes the CSL Search Engine. While the API is still functional, it has not been updating consistently from the source files since April 21, 2025. Any entries or companies that were on the various lists prior to April 21 will be reflected in searches. To search entries or companies added to the lists or updated since April 21, 2025, please visit the lists highlighted under ‘Key Sources’ on our Consolidated Screening List page.
Shipping Solutions Restricted Party Screening Software screens against more than 300 different lists, including all the U.S. lists and lists from the United Nations, European Union, and dozens of other countries. These lists are monitored and updated daily, as necessary, so you are always screening against the most current data. Click here to sign up for a free trial subscription to the software.
There are four reasons why an item might require an export license:
Shipping Solutions Export Controls Software makes determining the export license requirement quick and easy. Request a free trial subscription to the software now.
Keep in mind that export compliance essentials apply to more than just physical goods that leave the country. You may be an exporter by transferring knowledge to someone located in another country or even to somebody within the United States. These are called “deemed exports,” and apply when technology that is controlled is shared with a foreign person within the U.S.
Import compliance ensures goods entering the United States meet all regulatory requirements:
Importers need to find the correct Harmonized Tariff Schedule (HTS) classification for their items. These 10-digit codes determine:
Essential import documents include:
Multiple agencies regulate imports:
Recent regulatory developments have significantly expanded controls on advanced technology exports:
For the first time, artificial intelligence model weights are subject to export controls under interim rules published in January 2025. These controls target:
Enhanced controls now cover:
Companies involved in technology exports must:
Trade compliance involves more than following a checklist for international transactions. It includes keeping your eyes and ears open for any clues that something may not be quite right and then digging into that discomfort a little deeper to see if there is any merit to your concern.
On the export side, BIS calls these suspicions of illegal activities “red flags,” and defines them as “any abnormal circumstances in a transaction that indicate that the export may be destined for an inappropriate end use, end user or destination.”
It is illegal to ignore these suspicions. Instead you should explore the red flags until you are satisfied that everything is above board or you cancel the transaction.
It is impossible to create a complete list of red flags, but BIS does provide some guidance:
The United States has Free Trade Agreements (FTAs) with 20 countries. While these FTAs have traditionally allowed many goods to enter the United States and the partner countries duty free, the Trump Administration has announced a variety of new tariffs in 2025 that may be applied on goods that qualify under the applicable FTA. In response, many of these countries have or have threatened to impose additional tariffs on U.S. goods.
Companies should monitor the status of these tariffs for FTA and non-FTA eligible goods. Shipping Solutions Import Controls Software provides an up-to-date list of import tariffs and any other import restrictions that apply to products in any country. Sign up now for a free trial subscription to the Import Controls Software.
Understanding the current penalty landscape is crucial for risk assessment:
BIS publishes a PDF guide, Don’t Let This Happen to You!, that cites numerous examples of export violations and the penalties companies have paid as a result. Here are some of those examples:
Now that the Commerce Department has removed caps on the amount of penalties that companies have to pay for export violations, high-value transactions can result in proportionally massive penalties, making compliance programs essential cost-protection measures.
To help ensure compliance with export regulations, companies should create a written export compliance program (ECP), share it widely and review it regularly. If a company’s products are controlled under ITAR, an ECP is mandatory. Even if not required, companies will benefit from improved compliance—and even potential reductions in penalties if accidental violations occur—with an ECP in place and documentation that it has been followed.
Here are 12 steps companies can follow to create an effective compliance program:
Executive buy-in is non-negotiable. Your compliance program needs dedicated resources, clear authority and visible leadership support. Document this commitment in your corporate compliance policy.
Assess your current state by:
Not sure how your current compliance efforts stack up? Take our Export Compliance Quiz to quickly assess your strengths and potential blind spots.
Develop systematic approaches for:
Have technology in place for:
Establish procedures for:
Implement department-specific training covering:
Maintain comprehensive records including:
Stay current through:
For technology companies, additional measures include:
Develop protocols for:
Schedule systematic reviews covering:
Select service providers based on:
While compliance responsibilities have grown and penalties for no-compliance have increased, there are affordable software solutions that can help companies of all sizes meet these responsibilities and avoid these penalties.
Compliance software rolled out throughout an organization ensures easy access, which increases the likelihood it will be used; consistent results, since all company employees utilize the same tools; and improved record keeping, since the best solutions include an audit trail of all screenings.
The cost of trade compliance depends on the size of a company and the volume of its imports and exports. These costs include the time and personnel required to build and manage a strong compliance program. But these costs don’t have to be outrageous.
If the experience and personnel to create a compliance program don’t exist in-house, outside consulting firms can be used. And while software used to manage these programs can cost hundreds of thousands of dollars or more for large global corporations, easy-to-use software options like those from Shipping Solutions are available for just a few thousand dollars.
While compliance programs require an up-front investment, the cost of non-compliance far exceeds these expenses:
Don't let compliance uncertainty hold back your international growth. Whether you're just starting to export or looking to strengthen existing programs, the key is taking systematic action:
Remember: trade compliance isn't a destination—it's an ongoing journey that requires consistent attention and continuous improvement.
The global marketplace offers tremendous opportunities for U.S. companies willing to navigate the compliance landscape effectively. With proper planning, investment, and execution, your compliance program becomes a competitive advantage that enables confident international expansion while protecting your business from costly violations.
Ready to strengthen your trade compliance program? Explore how Shipping Solutions' Trade Compliance Software can automate and streamline your compliance processes.
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