In the fast-paced and interconnected world of international trade, proper management of goods and technologies is essential to ensure customs compliance, efficient supply chain operations, and adherence to international trade regulations. Export Control Classification Numbers (ECCN codes) play a pivotal role in achieving these objectives. Let's delve deeper into ECCN codes, their significance, and how they contribute to the world of shipping and global trade compliance.
What is an ECCN Code?
Export Control Classification Number (ECCN) codes are five-character alphanumeric codes used on the Commerce Control List (CCL) to categorize and control the export of dual-use goods and technologies. These codes are part of the Export Administration Regulations (EAR), which are kept by the U.S. Department of Commerce. While they come from the United States, ECCN codes are used by many countries to regulate international trade. Each ECCN code corresponds to a specific commodity or technology to help determine whether an item is subject to export controls and which licensing requirements apply.
The Breakdown of The Meaning Behind The ECCN Code
1
The first character is a number between 0-9. This indicates the CCL category.
2
The second character is a letter between A – E and refers to the product group.
3-5
The final three characters are numerical values and refer to the level of control applied.
How to Find an ECCN Number
If you need an ECCN for your anticipated export, you can either:
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- Speak with the manufacturer, who might already possess an ECCN.
- Search through the categories of the Commerce Control List and find the ECCN that most closely matches your product
- Alternatively, use the BIS multipurpose application form BIS-748P. You could send a letter to BIS requesting your ECCN. Apply early because this could take 3 to 4 weeks!
Why Do I Need an ECCN Code for Global Trade?
For companies operating in the global marketplace, ECCN codes are a fundamental aspect of their overall trade compliance strategy. Keeping up to date with the latest ECCN updates and trade regulations is crucial to maintain a compliant and efficient international trade operation. It enables businesses to adapt swiftly to regulatory changes and make informed decisions while managing risks associated with global trade.
Customs Compliance and Trade Regulations:
ECCN codes are essential in customs compliance. Customs authorities across the world use these codes to assess shipments, verify their legitimacy, and enforce trade regulations. By correctly identifying the ECCN code of goods being exported, companies can determine the applicable import duties, customs duties, and other trade restrictions. This enables businesses to adhere to trade regulations, ensuring a smooth customs clearance process and minimizing the risk of penalties for non-compliance.
ECCNs also indicate whether certain products have been banned from the destination country or reveal blacklisted traders. Since these goods have military implications, incorrectly classifying goods can have severe repercussions.
What is an EAR99 Classification?
EAR99 is the classification for items that do not (in most cases) need an export license. This applies mostly to low-technology consumer goods due to their basic specifications. However, careful diligence is still required of the exporter in these instances to ensure that goods are not entering an embargoed country or end-use, in which case an export license may be required.
What is the Difference Between ECCNs and HS Codes?
Harmonized system codes or HS codes and ECCNs are similar but are considered independent. Both HS codes and ECCNs describe the nature of the product and classify them accordingly. That is where that similarity begins and ends.
While ECCNs dictate what licensing is required, HS codes determine the duties and taxes associated with that product.
Numerous factors influence the ECCN number and licensing requirements of a particular product. This means one HS code may have several ECCNs and vice versa.
TecEx Makes Trade Compliance Simple
ECCN codes are key tools in the world of shipping, customs compliance, and global trade. By properly classifying goods and technologies, businesses can navigate the complexities of international trade regulations, ensure efficient supply chain management, and safeguard against legal repercussions.
With TecEx, you can confidently pursue international trade while remaining compliant, efficient, and competitive in the global economy. Our compliance database and in-country experts ensure that your goods will be accurately identified so the appropriate trade compliance documentation is sourced and collated.
Now You Know: ECCN Codes Go Beyond Physical Goods.
With the ever-expanding digital landscape, intangible items like software and technology exports have become prevalent, and they, too, may require an ECCN code for export control purposes. Classifying intangible items accurately is equally critical, as the mismanagement of software and technology exports can have far-reaching consequences on your global trade compliance.
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Let’s find a solution that works for you
Fill in the form to get in touch, and our expert team will contact you with a bespoke customs compliance solution to suit your needs.