Global Sanctions & Export Controls

Your Challenge

Sanctions and export controls pose a significant challenge for businesses that operate internationally or export, given the constantly changing regulatory landscape. Companies face serious legal (compliance) risks as they seek to navigate these complex trade regulations.

Export controls laws and regulations are designed to support national and international security measures aimed at preventing the proliferation of weapons of mass destruction (“WMD”) and maintaining regional stability. These restrictions apply to military-related items and “dual-use” items, including goods, software and technology. These trade controls are especially relevant to new or emerging technologies such as IoT, 5G, digital platforms, cloud, which are widely used in industries such as telecommunications, cybersecurity, aerospace & defense, life sciences, oil & gas, nuclear energy, chemicals, and manufacturing.

Next to export controls, sanctions restrict the possibilities to do business with parties, or they impose conditions on (financial) transactions and new market entries in several regions in the world.

Both export controls and sanctions are part of the field of national security.

Penalties

Non-compliance with the regulations can result in significant penalties, the removal of export privileges, a ban of trade or business, and criminal and civil liability of corporate entities and directors.

Examples of penalties in The Netherlands:

• Logistics company: Transit of drones (military goods) from the U.S. via The Netherlands to Saudi Arabia without required Dutch transit license. Penalty: fines
• Cargo company: Transit of parts of military drones via The Netherlands to Latin-American country. company used an intermediate company. Penalty: fines and imprisonment
• Gas Turbine parts: Shipment to Iran. Use of catch all provision by government, formal letter (notice) and meeting between the Company and government. Penalty: fines and director liability, imprisonment shareholder

How Deloitte can help

Deloitte works with clients (corporations and financial institutions) to develop and enhance their sanctions and export controls (global trade compliance) framework so that people, process, and technology not only enable the efficient movement of goods, software, technology and people but also effectively support their overall international business strategy.

Our practitioners have significant experience with global sanctions and export controls restrictions and (automation) technology that may facilitate smooth implementation of internal controls. The team regularly advises clients across various industry sectors on all aspects of trade controls.

Deloitte can assist you in:

• Trade compliance organizational design (framework): review and assess the effectiveness of the clients sanctions and export controls program.
• Merger & Acquisition Due Diligence assessments from an export controls, sanctions and broader national security perspective (including CFIUS – Committee Foreign Investment in the U.S.)
• Conduct a sanctions and/or export controls Audit and provide recommendations
• Developing a global export controls (ECCN) classification database
• Conduct an export controls and sanctions risk assessment and a gap analysis
• Design and implement an internal compliance program in accordance with the relevant sanctions and export controls laws and regulations (e.g., U.S. (EAR/ITAR), and EU and national rules)
• Preparing and delivering sanctions and export controls Training
• Provide ad hoc legal advice
• Assist in negotiations, settlements and legal procedures with governmental agencies

For more information please get in touch with Maaike van Velzen or Johan Hollebeek.