Integrated Trade Compliance Strategy Presentation October 2010

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The case for an Integrated Trade Compliance Strategy presentation including the visual silo based model and integrated trade compliance strategy model.

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Integrated Trade Compliance Strategy Presentation October 2010

  1. 1. The Case For An Integrated Trade Compliance Strategy Reynold Martens Executive Vice President GHY International President, GHY USA
  2. 2. Context <ul><li>“ Manufacturing not what it used to be” </li></ul><ul><li>Global forces intensifying competition </li></ul><ul><li>Supply chain/markets diversifying beyond US </li></ul><ul><li>Complex new mix </li></ul><ul><li>Origins, manufacturing locations, destinations </li></ul><ul><li>Importers and exporters under surveillance 24/7 </li></ul><ul><li>Compliance = price of admission to global trade </li></ul><ul><li>Non compliance increasingly costly </li></ul><ul><li>Lost opportunities, margins, penalties, reputation </li></ul>
  3. 3. Our Thesis <ul><li>Are international traders adapting to new trade reality? </li></ul><ul><li>Compliance outsourced or compartmentalized </li></ul><ul><li>Import and export functions internally are often “silos” </li></ul><ul><li>Trade related financials have limited corporate visibility </li></ul><ul><li>Regulatory interventions force executive focus </li></ul><ul><li>End result is clear audit trails and accountability </li></ul><ul><li>Integrated cross-functional approach reduces exposure </li></ul><ul><li>End game: reduce risks & maximize opportunities </li></ul><ul><li>Cost of reacting is more than a taking a proactive stance </li></ul>
  4. 4. Outline <ul><li>Overview Canada’s shifting trade dynamics </li></ul><ul><li>Canadian compliance landscape </li></ul><ul><li>The problem with “silos” </li></ul><ul><li>The solution: An integrated approach </li></ul><ul><li>Building an integrated trade model </li></ul><ul><li>Overview a sample plan </li></ul><ul><li>Summary </li></ul>
  5. 5. Canada: Trade Volume Index
  6. 6. Canada’s International Import Sources 2009 Imports: $365.2 billion Data Source: Industry Canada, Trade Data Online , June 2010
  7. 7. Canada’s International Export Destinations 2009 Foreign Merchandise Exports: $334.6 billion Data Source: Industry Canada, Trade Data Online , June 2010
  8. 8. North American Supply Chain
  9. 9. Trade/Compliance Intersections <ul><li>Global perspective: flow model from 30000 feet </li></ul><ul><li>Regulatory intersections create compliance implications </li></ul><ul><li>Global sourcing and marketing increases risk </li></ul><ul><li>Customs regimes enforce all trade-related laws </li></ul><ul><li>Tariff, value, origin just the beginning </li></ul><ul><li>Other government departments piggyback Customs </li></ul><ul><li>Product design-performance standards, </li></ul><ul><li>Consumer Safety </li></ul><ul><li>Quota Management,Permits, Licenses </li></ul><ul><li>Security Screening, Patents, Labeling-Packaging </li></ul>
  10. 10. CBSA Compliance Objectives
  11. 11. CBSA Audit Trend
  12. 12. Current Model
  13. 13. Current Model
  14. 14. Current Model
  15. 15. Product Design Production/Manufacturing Global Sourcing Supply Chain/Logistics Shipping Human Resources Information Technology Assets & Liabilities Cash Flow Management Regulatory Compliance Risk Management Financial Report Administration Domestic Sales International Sales New Export Markets Contract Negotiations Contract Management Sales Administration Marketing CDN Customs Broker US Customs Broker Trade Services CDN Auditors US Auditors Legal Services Finance Services Current Model
  16. 16. Minimize Risk Optimize Opportunity Integrated International Trade Strategy Predictable Compliant Sustainable Service Providers ·Legal ·Financial ·Trade ·Customs Integrated Model
  17. 17. Minimize Risk Optimize Opportunity Integrated International Trade Strategy Predictable Compliant Sustainable Service Providers ·Legal ·Financial ·Trade ·Customs Integrated Model enterprise performance enterprise expansion enterprise risk/liability accountability framework
  18. 18. Minimize Risk Optimize Opportunity Integrated International Trade Strategy Predictable Compliant Sustainable Service Providers ·Legal ·Financial ·Trade ·Customs Integrated Model key performance indicators KPI strategic planning expansion assessment partnerships, acquisitions enterprise risk assessments  executive team leadership budgets, revenue projections
  19. 19. Minimize Risk Optimize Opportunity Integrated International Trade Strategy Predictable Compliant Sustainable Service Providers ·Legal ·Financial ·Trade ·Customs Integrated Model business plan execution P & L --financial performance risk management and reporting strategic plan execution management team leadership
  20. 20. Minimize Risk Optimize Opportunity Integrated International Trade Strategy Predictable Compliant Sustainable Service Providers ·Legal ·Financial ·Trade ·Customs Integrated Model
  21. 21. Minimize Risk Optimize Opportunity Integrated International Trade Strategy Predictable Compliant Sustainable Service Providers ·Legal ·Financial ·Trade ·Customs Integrated Model
  22. 22. Minimize Risk Optimize Opportunity Integrated International Trade Strategy Predictable Compliant Sustainable Service Providers ·Legal ·Financial ·Trade ·Customs Integrated Model <ul><li>client qualification and negotiation </li></ul><ul><li>contracts/purchase orders </li></ul><ul><li>product design, packaging, labelling </li></ul><ul><li>product licensing, patents, trademark rights </li></ul><ul><li>related/unrelated parties valuation </li></ul><ul><li>importer of record  determination </li></ul><ul><li>currency of settlement </li></ul><ul><li>financial terms, instruments </li></ul><ul><li>global tariff classification, origin </li></ul><ul><li>logistics-supply chain management </li></ul><ul><li>supply chain security reporting protocols </li></ul><ul><li>customs clearance and reporting </li></ul><ul><li>OGD special requirements </li></ul><ul><li>regulatory intervention management </li></ul>
  23. 23. Minimize Risk Optimize Opportunity Integrated International Trade Strategy Predictable Compliant Sustainable Integrated Model Service Providers ·Legal ·Financial ·Trade ·Customs <ul><li>client-lawyer privilege situation </li></ul><ul><li>client-vendor disputes </li></ul><ul><li>regulatory interventions/audits </li></ul><ul><li>intellectual property/licenses, trademarks  </li></ul><ul><li>proprietary information breaches </li></ul><ul><li>appeals </li></ul><ul><li>lawsuit- pursuit/response </li></ul><ul><li>international financing </li></ul><ul><li>international credit instruments </li></ul><ul><li>insurance in transit, cargo, receivables </li></ul><ul><li>foreign currency exchange facilitation </li></ul><ul><li>foreign currency exchange hedging/contracts </li></ul><ul><li>regulatory bonds and sureties </li></ul><ul><li>domestic/foreign tax strategies </li></ul><ul><li>domestic/foreign tax preparation </li></ul><ul><li>international/domestic tax representation </li></ul><ul><li>internal audit corporation, branches, subs </li></ul><ul><li>valuation formulae and transfer pricing </li></ul><ul><li>international /domestic trade audit trails </li></ul><ul><li>regulatory interventions/audits </li></ul><ul><li>regulatory appeals and tax rulings </li></ul><ul><li>global sourcing assessments-regulatory impact </li></ul><ul><li>global market assessment-regulatory impact </li></ul><ul><li>free trade agreement assessments/application </li></ul><ul><li>landed cost assessment imports/exports </li></ul><ul><li>importer of record representation to regulators/OGD's </li></ul><ul><li>import database creation by product-tariff, valuation,origin </li></ul><ul><li>customs clearance, reporting, financial settlement </li></ul><ul><li>importer of record bonding, surety </li></ul><ul><li>regulatory interventions/audits </li></ul><ul><li>Customs/OGD appeals and rulings </li></ul>
  24. 24. Minimize Risk Optimize Opportunity Integrated International Trade Strategy Predictable Compliant Sustainable Service Providers ·Legal ·Financial ·Trade ·Customs Integrated Model
  25. 25. Summary <ul><li>Intensifying trade complexity –supply chains & markets </li></ul><ul><li>Increasing regulatory surveillance and intervention </li></ul><ul><li>Compliance is a competitive weapon </li></ul><ul><li>Integrated approach addresses gaps presented by silos </li></ul><ul><li>Increased visibility and shared ownership reduces risk </li></ul><ul><li>Maximize commercial opportunity and profitability </li></ul><ul><li>Minimize downside risk that erodes margins </li></ul><ul><li>Grow your business! </li></ul>
  26. 26. More Information <ul><li>Reynold Martens </li></ul><ul><li>Executive Vice President </li></ul><ul><li>GHY International </li></ul><ul><li>204 947 6700, ext 286 </li></ul><ul><li>[email_address] </li></ul><ul><li>White Paper: “Why Trade Compliance Matters” </li></ul><ul><li>Sample Compliance Responsibility Matrix </li></ul><ul><li>Sample Compliance Manual </li></ul>

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