How to Import into the US

Shipping Weight

Shipping weight represents the gross weight in kilograms of shipments, including the weight of moisture content, wrappings, crates, boxes, and containers (other than cargo vans and similar substantial outer containers).

Ship’s Manifest

An instrument in writing, signed by the captain of the ship, that lists the individual shipments constituting the ship’s cargo.

Short Supply

Commodities in short supply may be subject to export controls to protect the domestic economy from the excessive drain of scarce materials and to reduce the serious inflationary impact of satisfying foreign demand. Two commodities which the U.S. controls for short supply purposes are crude oil and unprocessed western red cedar.

SIC – See: Standard Industrial Classification

Sight Draft

A draft which is payable upon presentation to the drawee. Compare: Date Draft, Time draft.

Single Carrier

A single carrier is an individual vessel, plane, truck, and rail car, not a steamship line or airline. For overload exports, the Customs Director may accept a single declaration for multiple car shipments moving under a single bill of lading and cleared simultaneously.

SITC – See: Standard International Trade Classification

Societe Anonyme (S.A.)

French expression meaning a corporation.

Special Drawing Rights (SDRs)

SDRs are international reserve assets, created by the International Monetary Fund (IMF) and allocated to individual member nations. Within conditions set by the IMF, SDRs can be used by a nation with a deficit in its balance of international payments to settle debts with another nation or with the IMF.

Special 301

The Special 301 statute requires the United States Trade Representative (IJSTR) to review annually the condition of intellectual property protection among U.S. trading partners. Submissions are accepted from industry after which the USTR, weighing all relevant information, makes a determination as to whether a country presents excessive barriers to trade with the United States by virtue of its inadequate protection of intellectual property. If the USTR makes a positive determination, a country may be named to the list of: (a) Priority Foreign Countries (the most egregious), (b)the Priority Watch List, or (c) the Watch List.

Spot Exchange

The purchase or sale of foreign exchange for immediate delivery.

Standard Industrial Classification (SIC)

The SIC is the classification standard underlying all establishment-based U.S. economic statistics classified by industry.

Standard Industrial Trade Classification (SITC)

A standard numerical code system developed by the United Nations to classify commodities used in international trade. Compare: Nomenclature of the Customs Cooperation Council, Standard Industrial Classification.

Standards

As defined by the Multilateral Trade Negotiations “Agreement on Technical Barriers to Trade” (Standards Code), a standard is a technical specification contained in a document that lays down characteristics of a product such as levels of quality, performance, safety, or dimensions. Standards may include, or deal exclusively with, terminology, symbols, testing and test methods, packaging, marking, or labeling requirements as they apply to a product.

State-Controlled Trading Company

In a country with a state trading monopoly, a trading entity empowered by the country’s government to conduct export business.

State/Industry-Organized, Government Approved

The State/Industry-Organized, Industry Approved (S/IOGA) trade missions are planned and organized by state development agencies, trade associations, chambers of commerce, and other export-oriented groups. To qualify for U.S. government sponsorship, organizers of this type of trade mission must agree to follow International Trade Administration criteria in planning and recruiting the mission. ITA offers guidance and assistance from planning through completion of the mission and coordinates the support of all relevant offices and the assistance of overseas commercial officers in each foreign city on the itinerary. The missions are normally led by a representative of the sponsoring organization. Organizers of S/IOGA missions recruit for the event and cover the expenses of the event incurred by ITA’s overseas post. S/IOGA missions may use the seminar format, the exhibit format, the traditional trade mission format, or a combination, such as a seminar/mission or exhibit/mission.

State Trading Enterprises

STEs are entities established by governments to import, export and/or produce certain products. Examples include: government-operated import/export monopolies and marketing boards or private companies that receive special or exclusive privileges from their governments to engage in trading activities.

Steamship Conference

A group of steamship operators that operate under mutually agreed upon freight rates.

Subsidies

GATT does not directly define subsidies. The U.S. regards a subsidy as a bounty or grant paid for the manufacture, production, or export of an article. Export subsidies are contingent on exports; domestic subsidies are conferred on production without reference to exports. While governments sometimes make outright payments to firms; subsidies usually take a less direct form (R&D support, tax breaks, loans on preferential terms, and provision of raw materials at below-market prices).

Summary Investigation

A 20-day investigation conducted by the International Trade Administration immediately following filing of an antidumping petition to ascertain if the petition contains sufficient information with respect to sales at “less than fair value” and the injury or threat of mateflal injury to a domestic industry caused by the alleged sales at “less than fair value” to warrant the initiation of an antidumping investigation.

Summit Conference

A summit conference is an international meeting at which heads of government are the chief negotiators, major world powers are represented, and the meeting serves substantive rather than ceremonial purposes. The term first came into use in reference to the Geneva Big Four Conference of 1955.

Switch Arrangements

A form of countertrade in which the seller sells on credit and then transfers the credit to a third party.

System for Tracking Export License Applications

STELA is a BXA computer-generated voice unit that interfaces with the BXA databaSe ECAS (Export Control Automated Support System). STELA enables a caller to check on an export license by making a telephone call.

Table of Denial Orders

The TDO is a list of individuals and firms which have been disbarred from shipping or ~eceiV1ng U.S. goods or technology. Firms and individuals on the list may be disbarred with respect to either controlled commodities or general destination (across-the-board) exports.

Tare Weight

The weight of a container and/or packing materials without the weight of the goods it contains. Compare: Gross Weight.

Tariff

A tax assessed by a government in accordance with its tariff schedule on goods as they enter (or leave) a country. May be imposed to protect domestic industries from imported goods andlorto generate revenue. Types include ad valorem, specific, variable, or some combination.

Tariff Anomaly

A tariff anomaly exists when the tariff on raw materials or semi-manufactured goods is higher than the tariff on the finished product.

Tariff Escalation

A situation in which tariffs on manufactured goods are relatively high, tariffs on semi-pro~~5~ goods are moderate, and tariffs on raw materials are nonexistent or very low.

Tariff Quotas

Application of a higher tariff rate to imported goods after a specified quantity of the item has entered the country at a lower prevailing rate.

Tariff Schedule

A comprehensive list of the goods which a country may import and the import duties applicable to each product.

Technical Advisory Committee

The TACs are voluntary groups of industry and government representatives who provide guidance and expertise to Commerce on technical and export control matters, including evaluation of technical issues; worldwide availability, use and production of technology; and licensing procedures related to specific industries. TACs have been set up for: (a) materials, (b) biotechnology, (c) computer systems, (d) electronics (formerly “semiconductors”), (e) sensors (formerly “electronic instrumentation”) (f) materials processing equipment (formerly “automated manufacturing equipment”), (g) military critical technologies, (h) telecommunications equipment, and (I) transportation and related equipment.

Technical Barrier to Trade

According to the Standards Code, a specification which sets forth characteristics or standards a product must meet (such as levels of quality, performance, safety, or dimensions) in order to be imported.

Technical Data

BXA regulations define technical data as “information of any kind that can be used, or adapted for use, in the design, production, manufacture, utilization, or reconstruction of articles or materials. All software is technical data.” Technical data can be either “tangible” or “intangible.” Models, prototypes, blueprints or operating manuals (even if stored on recording media) are examples of tangible technical data. Intangible technical data consists of technical services, such as training, oral advice, information guidance and consulting.

Technology Transfer

This term is used to characterize “the transfer of knowledge generated and developed in one place to another, where it is used to achieve some practical end.” Technology may be transferred in many ways: by giving it away (technical journals, conferences, emigration of technical experts, technical assistance programs); by industrial espionage; or by sale (patents, blueprints, industrial processes, and the activities of multinational corporations).

Through Bill of Lading

A single bill of lading covering both the domestic and international carriage of an export shipment. An air waybill, for instance is essentially a through bill of lading because of lading used for air shipments. Ocean shipments, on the other hand, usually require two separate documents — an inland bill of lading for domestic carriage and an ocean bill of lading for international carriage. Compare: Air Waybill, Inland Bill of Lading, Ocean Bill of Lading.

Time Draft

A draft which matures either a certain number of days after acceptance or a certain number of days after the date of draft.

Trade Act of 1974

Legislation enacted late in 1974 and signed into law in January 1975, granting the President broad authority to enter into international agreements to reduce import barriers. Major purposes were to: (a) stimulate U.S. economic growth and to maintain and enlarge foreign markets for the products of U.S. agriculture, industry, mining and commerce; (b) strengthen economic relations with other countries through open and non-discriminatory trading practices; (c) protect American industry and workers against unfair or injurious import competition; and (d) provide “adjustment assistance” to industries, workers and communities injured or threatened by increased imports. The Act allowed the President to extend tariff preferences to certain imports from developing countries and set conditions under which Most-Favored-Nation Treatment could be extended to non-market economy countries and provided negotiating authority for the Tokyo Round of multilateral trade negotiations.

Other Party Authorized to Receive License

The person authorized by the applicant to receive the license. If a person and address is listed in Block 15 of the BXA-748P Multipurpose Application Form, the Bureau of Export Administration will send the license to that person instead of the applicant. Designation of another party to receive the license does not alter the responsibilities of the applicant, licensee or exporter.

Overseas Private Investment Corporation

OPIC is a government corporation which assists U.S. private investments in less developed nations. These investments may include distributorships owned by U.S. manufacturers which are consistent with the economic interests of both the United States and the developing country involved.

Packing List

A list showing the number and kinds of items being shipped as well as other information needed for transportation purposes.

Parcel Post Receipt

The postal authorities’ signed acknowledgement of delivery to them of a shipment made by parcel post.

Period of Investigation

The period, usually 6 months, beginning at least 150 days before and continuing 30 days after the first day of the month when an antidumping petition is filed, during which an exporter’s home market (or third country) and United States prices and other appropriate facts are investigated to determine whether sales to the United States have been at less than fair value.

Phytosanitary Inspection Certificate

A certificate, issued by the U.S. Department of Agriculture, to satisfy import regulations of foreign countries, indicating that a U.S. shipment has been inspected and is free from harmful pests and plant diseases.

Port of Export

Port of Export is the Customs port at which, or nearest to which, the land surface carrier transporting the merchandise crosses the border of the United States into foreign territory or, in the case of exportation by vessel or air, the Customs port where the merchandise is loaded on the vessel or aircraft which is to carry the merchandise to a foreign country or to a non-foreign area of ultimate destination.

Post-Shipment Verifications (PSVs)

PSVs conducted to determine that a commodity is being used for the purposes for which its export was licensed. Firms or individuals representing the end user, intermediate consignees, or the purchaser may be subject to inquiries pertaining to the post-shipment verification. As part of the PSV process, BXA forwards a cable to the U.S. embassy or consulate in the respective geographic location to conduct an on-site inspection to ensure that the commodity is physically present and used as stated in the application. Post-shipment verifications are usually conducted six-to-eight months subsequent to export of the commodity.

Power of Attorney (Formal)

A legal authorization from a principal party in interest to a forwarding agent to act on their behalf to facilitate the export of merchandise out of the United States; specifies the responsibilities to be carried out in accordance with U.S. laws and regulations.

Pre-License Checks

PLCs are conducted to determine that a request for a license to export a controlled commodity represents a legitimate order. Firms or individuals representing the licensee (the applicant), a consignee, the purchaser, an intermediate consignee, or the end user may be subject to inquiries pertaining to the pre-license check. As part of the process, BXA forwards a cable to the U.S. embassy or consulate in the respective geographical location to conduct an inspection or meet with company representatives to conduct inquiries on BXA’s behalf.

Preliminary Determination

The dumping determination by the International Trade Administration announcing the results of the investigation conducted within 160 days (or, in extraordinarily complicated cases, 210 days) after a petition is filed or an investigation is self-initiated by the International Trade Administration. If the International Trade Administration determines that there is a reasonable basis to believe or suspect that the merchandise under consideration is being sold or is likely to be sold at less than fair value, liquidation of all affected entries is suspended, and the matter is referred to the International Trade Commission. “Preliminary determination” also refers to the decision by the ITC where there is a reasonable indication that an industry in the United States is materially injured, or threatened with material injury, or the establishment of an industry in the United States is materially retarded by reason of the imports of the merchandise which is the subject of the petition. The ITC must make its decision within 45 days after the date on which the petition is filed or an investigation is self-initiated by the International Trade Administration. If this determination is negative, the investigation is terminated.

President’s Export Council

The President’s Export Council (PEC) advises the President on government policies and programs that affect U.S. trade performance; promote export expansion; and provide a forum for discussing and resolving trade-related problems among the business, industrial, agricultural, labor and government sectors. The council was established by Executive Order of the President in 1973 and was originally composed only of business executives. The Council was reconstituted in 1979 to include leaders of the labor and agricultural communities, Congress, and the Executive branch. Twenty-eight private sector members serve “at the pleasure of the President” with no set term of office. Other members include five U.S. Senators and five Members of the House, the Secretaries of Agriculture, Commerce, Labor, State, and Treasury, the Chairman of the Export-Import Bank, and U.S. Trade Representative. The Council reports to the President through the Secretary of Commerce.

Principal Parties in Interest

Those persons in a transaction that receive the primary benefit, monetary or otherwise, of the transaction. Generally, the principals in a transaction are the seller and the buyer. In most cases, a forwarding or other agent is not a principal party in interest.

Private Export Funding Corporation

PEFCO works with Eximbank in using private capital to finance U.S. exports. PEFCO acts as a supplemental lender to traditional commercial banking sources by making loans to public and private borrowers located outside of the United States who require medium and/or longer-term financing of their purchases of U.S. goods and services.

Product Groups

Commodity groupings used for export control purposes. See: Export Control Classification Number.

Profit

For the purposes of constructed value in an antidumping duty investigation or review, the profit used is the profit normally earned by a producer, from the country of export, of the same or similar product as that under investigation. By statute, the amount of profit shall not be less than 8 percent of the sum of general expenses and cost.

Pro Forma Invoice

An invoice provided by a supplier prior to the shipment of merchandise, informing the buyer of the kinds and quantities of goods to be sent, their value, and important specifications (weight, size, and similar characteristics).

Project License

The Bureau of Export Administration uses the project license to authorize large-scale exports of a wide variety of commodities and technical data for specified activities. Those activities can include capital expansion, maintenance, repair or operating supplies, or the supply of materials to be used in the production of other commodities for sale.

Protective Order

With regard to antidumping cases, a term for the order under which most business proprietary information is made available an attorney or other representative of a party to the proceeding.

Protest System

The Protest System, a part of Customs’ Automated Commercial System, tracks protests from the date they are received through final action. A protest is the legal means by which an importer, consignee, or other designated part may challenge decisions made by a District Director of Customs.

Marking

Letters, numbers, and other symbols placed on cargo packages to facilitate identification.

Marks of Origin

The physical markings on a product that indicate the country of origin where the article was produced. Customs rules require marks of origin of most countries.

Matchmaker Events

Matchmaker trade delegations are organized and led by the International Trade Administration to help new-to-export and new-to-market firms meet prescreened prospects who are interested in their products or services in overseas markets. Matchmaker delegations usually target two major country markets in two countries and limit trips to two weeks or less. This approach is designed to permit U.S. firms to interview a maximum number of prospective overseas business partners with a minimum of time away from their home office. The program includes U.S. embassy support, briefings on market requirements and business practices, and interpreters’ services. Matchmaker events, based on specific product themes and end-users, are scheduled for a limited number of countries each year.

Merchandise Trade Balance. See: Balance of Payments.

Military Assistance Program. See: Conventional Arms Transfer.

Missile Technology Control Regime

The purpose of the MTCR is to limit the proliferation of missiles “capable of delivering nuclear weapons,” to increase regional stability, and to convey publicly the firm resolve of the partners to address this issue. In April 1987, Canada, France, Germany, Japan, the U.K., and the U.S. agreed to establish the MTCR. The regime expanded to include Australia, Austria, Belgium, Denmark, Luxembourg, the Netherlands, New Zealand, Norway, and Spain. The MTCR does not have permanent organizations but convenes regular meetings to exchange information and coordinate member country stands. Under the MTCR, each member administers missile-related export controls independently. After the MTCR agrees that certain goods and technologies should be controlled for missile proliferation reasons, each member must implement the controls in its own domestic legislation. There is no international entity that oversees the implementation and enforcement of MTCR controls. Items and technology agreed by the MTCR partners to be controlled are listed in the MTCR Annex. The Annex is divided into two groups: Category I (consisting of complete rocket and unmanned air vehicle systems and subsystems) and Category II (encompassing components, equipment, technology, materials used in missile design, development, production or use).

Mixed Credit

Mixed credit refers to the practice of combining concessional and market-rate export credit as an export promotion mechanism.

Most Favored Nation Treatment (MFN)

A commitment that a country will extend to another country the lowest tariff rates it applies to any other country. All contracting parties undertake to apply such treatment to one another under Article I of GATT. When a country agrees to cut tariffs on a particular product imported from any other country eligible for most-favored nation treatment. This principle of non-discriminatory treatment of imports appeared in numerous bilateral trade agreements prior to the establishment of GATT. A country is under no obligation to extend MFN treatment to another country unless both are bilateral contracting parties of the General Agreement on Tariffs and Trade or MFN treatment is specified in a bilateral agreement.

Multi-Fiber Arrangement

An international umbrella compact, authorized by GATT, that allows contracting parties to negotiate bilaterally quantitative restrictions on textile imports (which normally would be considered contrary to GATT provisions) to the extent the importing country considers them necessary to prevent market disruption. The MFA provides that such restrictions should not reduce imports to levels below those attained during the preceding year. Bilateral agreements usually allow for import growth tied to anticipated greater demand.

Multilateral Agreement

An international compact in which three or more parties participate.

Multilateral Investment Fund

Under the Enterprise for the Americas Initiative, the fund complements the Inter-American Development Bank. The fund provides program and project grants to advance specific, market- oriented investment policy initiatives and reforms and encourages domestic and foreign investment in Latin America and the Caribbean.

Multilateral Trade Negotiations

A term describing eight multilateral rounds of negotiations held under the auspices of the General Agreement on Tariffs and Trade since 1947.

NAFTA – See: North American Free Trade Agreement

NAICS – See: North American Industry Classification System

National Processing Center

The U.S. Census Bureau’s official center for keying various government documents, such as CF-214, CF-7501 and the SEDs.

National Security Controls

National security controls restrict exports of U.S. goods and technology which would make a significant contribution to the military potential of another country and thus be detrimental to Western countries’ national security.

National Security Council

The NSC was established by the National Security Act of 1947 to advise the President with respect to the integration of domestic, foreign, and military policies relating to national security.

National Security Directives

NSDs provide policy or procedural guidance and are signed by the President. In 1989, the President reorganized the national security council committee process (separate from the EARB). As reorganized under the NSC, there are committees for CoCom, terrorism, non-proliferation, etc. NSDs were known as National Security Decision Directives, NSDDs, before President Bush’s reorganization. NSD-l reorganized the process; NSD-lO established the committees. The scope of coverage and the players are about the same under NSD and NSDD processes.

National Security Directive #53

NSD-53 deals with the export licensing process and sets specified time periods for resolving disputes on both national security and foreign policy export license applications. Under NSD-53, exports controlled on both of these grounds are subject to explicit time tables for interagency dispute resolution at the Sub-Cabinet level by the Advisory Committee on Export Policy (ACEP), and at the Cabinet level by the Export Administration Review Board (EARB). The Directive requires escalation to the ACEP not later than 100 days from the filing date of the applicant’s application, and if the disagreement cannot be resolved by the ACEP, for review and resolution by the BARB within 35 days of the date of the ACEP meeting. Cases not resolved by the EARB must be escalated to the President for resolution. The new procedures also permit an agency to refer a case at any stage of the dispute resolution process to the NSC for a 30 day policy review.

National Security Override

In some cases, despite a finding of foreign availability of a controlled commodity, control is maintained over exporting the commodity because it is deemed a national security sensitive item. The term national security override is used to describe this circumstance. The term has also been used in other contexts. For example, under a November 16, 1990 directive, the President tasked the interagency control groups to move as many dual use items from the State Department’s International Munitions List to the Commerce Department’s Control List. In some circumstances, a national security override is applied to prevent transfer of a particular item.

National Trade Data Bank

The NTDB contains international economic and export promotion information supplied by 15 U.S. agencies. Data are updated monthly and are presented in one of three standard formats: text, time series, or matrix. The NTDB contains data from the Department of Agriculture (Foreign Agricultural Service), Commerce (Bureau of the Census, Bureau of Economic Analysis, International Trade Administration, and the National Institute for Standard and Technology), Energy, Labor (Bureau of Labor Statistics), the Central Intelligence Agency, Eximbank, Federal Reserve System, U.S. International Trade Commission, Overseas Private Investment Corporation, Small Business Administration, the U.S. Trade Representative, and the University of Massachusetts (MISER data on state origins of exports).

National Trade Estimates Report

An annual report by UTSR that identifies foreign barriers to and distortions of trade.

Net Foreign Investment

Net foreign investment is the sum of U.S. exports of goods and services, receipts of factor income, and capital grants received by the United States (net), less the sum of imports of goods and services by the United States, payments of factor income, and transfer payments to foreigners (net). It may also be viewed as the acquisition of foreign assets by U.S. residents, less the acquisition of U.S. assets by foreign residents. It includes the BPA statistical discrepancy.

Newly Industrializing Companies

The term, originated by the Organization for Economic Cooperation and Development (OECD), describes nations of the Third World that have enjoyed rapid economic growth and can be described as “middle-income” countries (such as Singapore and the Republic of Korea).

Irrevocable Letter of Credit

A letter of credit in which the specified payment is guaranteed by the bank if all terms and conditions are met by the drawer. Compare: Revocable Letter of Credit.

Japan Export Information Center

The Japan Export Information Center (JBIC) provides information on doing business in Japan, market entry alternatives, market information and research, and product standards and testing requirements, tariffs and non-tariff barriers. The Center maintains a commercial library and participates in private and government-sponsored seminars on doing business in Japan. JEIC is operated by the International Trade Administration of the Department of Commerce.

Joint Committee for Investment and Trade

The JCIT, was established in October 1990 to demonstrate U.S. and Mexican commitment to greater economic cooperation. The Committee identifies trade and investment opportunities and coordinates trade promotion events.

Joint Venture

A business undertaking in which more than one firm shares ownership and control of production and/or marketing.

Kokusai Denshin Denwa

The Kokusai Denshin Denwa Company, KDD, was established in 1953 but traces its history back to 1871 and the establishment of its predecessor organizations. For more than a century, the company was Japan’s sole supplier of international telecommunications services and today remains Japan’s leading international carrier. KDD is Japan’s signatory to INTELSAT and INMARSAT.

Less Developed Country

An LDC is a country with low per capita gross national product. Terms such as third world, poor, developing nations, and underdeveloped have also been used to describe less developed countries.

Lesser Developed Countries

The classification LLDC was developed by the United Nations to give some guidance to donor agencies and countries about an equitable allocation of foreign assistance. The criteria for designating a country an LLDC, originally adopted by the UN Committee for Development Planning in 1971, have been modified several times. Criteria have included low: per-capita- income, literacy, .and manufacturing share of the country’s total gross domestic product. There is continuing concern that the criteria should be more robust and less subject to the possibility of easy fluctuation of a country between less developed and least developed status.

Letter of Credit (L/C)

A financial document issued by a bank at the request of the consignee guaranteeing payment to the shipper for cargo if certain terms and conditions are fulfilled. Normally it contains a brief description of the goods, documents required, a shipping date, and an expiration date after which payment will no longer be made.

International Atomic Energy Agency

The International Atomic Energy Agency is the primary international organization that enforces a system of safeguards to ensure that non-nuclear weapons states do not divert shipments of sensitive equipment from peaceful applications to the production of nuclear weapons. Before a supplier state of nuclear materials or equipment may approve an export to a non-nuclear weapons NPT (Nuclear non-Proliferation Treaty) signatory state, it must receive assurances that the recipient will place the material under IAEA safeguards. Subsequent to shipment the recipient state must allow IAEA officials to verify the legitimate end use of the exported materials or equipment. IABA, established in July 1957, gives advice and technical assistance to developing countries on nuclear power development, nuclear safety, radioactive waste management, and related efforts. Safeguards are the technical means applied by the IAEA to verify that nuclear equipment or materials are used exclusively for peaceful purposes.

International Atomic Energy List

The International Atomic Energy List is one of three lists maintained by CoCom. The AEL, comprised strictly of nuclear-related items that are also of commercial value, consists of: materials, facilities, nuclear-related equipment, and software. State, which has the lead in U.S. negotiations concerning the AEL, relies on DOE experts.

International Bank for Reconstruction and Development

The International Bank for Reconstruction and Development (or World Bank) was established in 1944 to help countries reconstruct their economies after World War II. IBRD now assists developing member countries by lending to government agencies, or by guaranteeing private loans for such projects as agricultural modernization or structural development.

International Banking Facility

An International Banking Facility, IBF, is one of four categories of foreign banking in the United States. An IBF is a set of asset and liability accounts that is segregated and limited to financing international trade.

International Commodity Agreement (ICA)

An ICA is an international understanding, usually reflected in a legal instrument, relating to trade in a particular basic commodity, and based on terms negotiated and accepted by most of the countries that export and import commercially significant quantities of the commodity. Some commodity agreements (such as exists for coffee, cocoa, natural rubber, sugar, and tin) center on economic provisions intended to defend a price range for the commodity through the use of buffer stocks or export quotas or both. Other commodity agreements (such as existing agreements for jute and jute products, olive oil, and wheat) promote cooperation among producers and consumers through improved consultation, exchange of information, research and development, and export promotion.

International Communications Satellite Organization (COMSAT)

The organization (formed under a multilateral agreement that owns, maintains, and operates the global satellite system used by over 100 participating countries. COMSAT is the United States’ representative to and participant in INTELSAT.

International Congress Office (ICO)

The ICO is a U.S. Travel and Tourism Administration office that persuades international associations to select the U.S. as venues for their meetings. The ICO operates out of the American Embassy in Paris.

International Development Association (IDA)

The IDA is an affiliate of the World Bank Group that was created in 1959 to lend money to developing countries at no interest and for a long repayment period. By providing development assistance through soft loans, IDA meets the needs of many developing countries that cannot afford development loans at ordinary rates of interest and in the time span of conventional loans.

International Development Cooperation Agency

Coordinating body of all aspects of U.S. economic assistance and cooperation with LDCs. IDCA consists of three parts: AID, TDP, and the Overseas Private Investment Corporation (OPIC). The Administrator of AID currently serves as the Acting Director of IDCA.

International Finance Corporation

The IFC was established in 1956 as a member of the World Bank Group. The 1FC promotes capital flow into private investment in developing countries.

International Freight Forwarder. See: Freight Forwarder.

International Investment. See: Foreign Direct Investment in the United States.

International Labor Organization

The ILO, set up in 1919, became a specialized agency of the United Nations in 1946. The ILO seeks to promote improved working and living conditions by establishing standards that reduce social injustice.

International Maritime Organization (IMO)

The International Maritime Organization was established as a specialized agency of the United Nations in 1948. The IMO facilitates cooperation on technical matters affecting merchant shipping and traffic.

International Maritime Satellite Organization

INMARSAT is an international partnership of signatories from 62 nations. The partnership provides mobile satellite capacity to its signatories who, in turn, use the capacity to provide worldwide mobile satellite services to their maritime, aeronautical and land-mobile customers – including shipping, cruise, fishing research and offshore exploration industries, and airlines. INIVIARSAT began service in 1976. COMSAT is the U.S. signatory to INIVIARSAT.

International Market Research. See: Industry Subsector Analysis

International Market Insights

International Market Insight, IMI, reports are prepared by staff at American embassies and consulates. An IMI covers developments in a single country that are of interest to traders and investors. Topics may include: new laws, policies and procedures, new trade regulations, and marketplace changes.

International Monetary Fund

The IMF was established ml 946 to act as the banker of last resort for countries experiencing foreign exchange deficiencies, and to monitor currency exchange relationships among nations.

International Munitions List

The International Munitions List, IML, is one of three lists controlled by the 17-member Coordinating Committee on Multilateral Export controls (CoCom). The IML contains 23 categories and is similar in coverage, but less restrictive, than the U.S. Munitions List (USML).

International Standards Organization

The ISO, established in 1947, is a worldwide federation of national bodies, representing approximately 90 member countries. The scope of the ISO covers standardization in all fields except electrical and electronic engineering standards, which are the responsibility of the IBC, International Electronic Commission. Together, the ISO and the IEC form the specialized system for worldwide standardization – the world’s largest non-governmental system for voluntary industrial and technical collaboration at the international level.

International Telecommunications Satellite Organization

INTELSAT, created in 1964 under a multilateral agreement, is a nonprofit cooperative of approximately 116 countries that jointly own and operate a global communications satellite system serving the world. The system is used primarily for international communications, and by many countries for domestic communications. In 1991, the INTELSAT system comprised a network of 16 satellites in geosynchronous orbit over the Atlantic, Indian, and Pacific Ocean regions, with service to about 1,500 international and domestic earth station antennas.

International Telecommunications Services

These are transborder services provided via cable, radio, or satellite. These service offerings have traditionally been international message telephone service (IMTS), telex, and telegraph, but during the 1980’s have grown to include private leased lines, overseas value-added services, and international 800 services.

International Trade Administration (ITA)

The International Trade Administration is a Department of Commerce agency responsible for operating the Export Assistance Centers and offers advice on export opportunities in 18 emerging countries.

International Trade Commission

An independent U.S. Government fact-finding agency with six commissioners who review and make recommendations concerning countervailing duty and antidumping petitions submitted by U.S. industries seeking relief from imports that benefit unfair trade practices. Known as the U.S. Tariff Commission before its mandate was broadened by the Trade Act of 1974.

International Traffic in Arms Regulations

The International Traffic in Arms Regulations, ITAR, are administered by the State Department to control the export of weapons and munitions.

International Value-Added Network Services

IVANS include advanced telecommunications services, such as voice mail and electronic banking. IVANS agreements play a growing role in maintaining the competitiveness of American firms and provide benefits for consumers worldwide.

Invisibles

This refers to areas of non-merchandise “invisible trade” that include expenses such as freight and insurance and most types of services and investment.

Imports

Imports of merchandise include commodities of foreign origin as well as goods of domestic origin returned to the United States with no change in condition or after having been processed and/or assembled in other countries. For statistical purposes, imports are classified by type of transaction: — Merchandise entered for immediate consumption. (“duty free” merchandise and merchandise on which duty is paid on arrival); — Merchandise withdrawn for consumption from Customs bonded warehouses, and U.S. Foreign Trade Zones; — Merchandise entered into Customs bonded warehouses and U.S. Foreign Trade Zones from foreign countries.

Imports for Consumption

“Imports for Consumption” measure the total of merchandise that has physically cleared through U.S. Customs either entering consumption channels immediately or entering after withdrawal for consumption from bonded warehouses under Customs custody or from Foreign Trade Zones. Many countries use the term “special imports” to designate statistics compiled on this basis.

In-Bond System

The In-Bond System, a part of Customs’ Automated Commercial System, controls merchandise from the point of unloading at the port of entry or exportation. The system works with the input of departures (from the port of unlading), arrivals, and closures (accountability of arrivals).

Incoterms

Maintained by the International Chamber of Commerce (ICC), this codification of terms is used in foreign trade contracts to define which parties incur the costs and at what specific point the costs are incurred.

Independent European Program Group

The IEPG is an intergovernmental organization that is not formally part of NATO but whose membership includes all the BC members of the alliance, plus Norway and Turkey. Established in 1976, IEPG’ s objectives are to promote European cooperation in research, development, and production of defense equipment; improve transatlantic armaments cooperation; and maintain a healthy European defense industrial base.

Individual Validated License

Written approval by the U.S. Department of Commerce granting permission, which is valid for two (2) years, for the export of a specified quantity of products, or technical data to a single recipient. Individual validated licenses also are required under certain circumstances, as authorization for reexport of U.S. origin commodities to new destinations abroad.

Industrial List

The CoCom industrial list contains dual-use items, whose export is controlled for strategic reasons.

Industry Subsector Analysis

As used by the International Trade Administration, an industry subsector analysis is overseas market research for a given industry subsector (such as cardiology equipment for the medical equipment industry) that presents basic information about a foreign market such as market size, the competitive environment, primary end users, best prospects products, and market access information.

In-Flight Survey

The In-Flight Survey is administered to U.S. and foreign travelers departing the U.S., as a means of providing data on visitor characteristics, travel patterns and spending habits, and for supplying data on the U.S. international travel dollar accounts as well as to meet balance of payments estimation needs. The IPS covers about 70 percent of U.S. carriers and 35 percent of foreign carriers, who voluntarily choose to participate. Sample results are expanded to universe estimates to account for nonresponse of passengers on each sampled flight, for coverage of all flights on each major airline route, and for all international routes. The basis for the expansion is the number of passengers departing the United States, obtained from the Immigration and Naturalization Service.

Informed Compliance. See: Compliance Strategy.

Inherent Vice

An insurance term referring to any defect or other characteristic of a product which could result in damage of the product without external cause (for example, instability in a chemical that could cause it to explode spontaneously). Insurance policies may specifically exclude losses caused by inherent vice.

Initial Negotiating Right ~INR)

A right held by one GATT country to seek compensation for an impairment of a given bound tariff rate by another GATT country. INRs stem from past negotiating concessions and allow the INR holder to seek compensation for an impairment of tariff concessions regardless of its status as a supplier of the product in question.

Injury

In U.S. law, a finding by the International Trade Commission that imports are causing, or are likely to cause, harm to a U.S. industry. An injury determination is the basis for a Section 201 case. It is also a requirement in all antidumping and most countervailing duty cases, in conjunction with Commerce Department determinations on dumping subsidization.

Inland Bill of Lading

A bill of lading used in transporting goods overland to the exporter’s international carrier. Although a through bill of lading can sometimes be used, it is usually necessary to prepare both an inland bill of lading and an ocean bill of lading for export shipments.

Inspection Certification

Some purchasers and countries may require a certificate of inspection attesting to the specifications of the goods shipped, usually performed by a third party. Inspection certificates are often obtained from independent testing organizations.

Insurance Certificate

This certificate is used to assure the consignee that insurance is provided to cover loss of or damage to the cargo while in transit.

Integrated Carriers

Carriers that have both air and ground fleets; or other combinations, such as sea, rail, and truck. Since they usually handle thousands of small parcels an hour, they are less expensive and offer more diverse services than regular carriers.

Intellectual Property Rights

This is the ownership of the right to possess or otherwise use or dispose of products created by human ingenuity.

INTELSAT. See: International Communications Satellite Organization.

Interagency Group on Countertrade (IGC)

The IGC, established in December 1988 under Executive Order 12661, reviews policy and negotiates agreements with other countries on countertrade and offsets. The IGC operates at the Assistant Secretary level, with the Department of Commerce as chair. Membership includes 11 other agencies: Agriculture, Defense, Energy, Justice, Labor, State, Treasury, the Agency for International Development, the Federal Emergency Management Agency, the U.S. Trade Representative, and the Office of Management and Budget.

Inter-American Development Bank

A regional financial institution established in 1959 to advance the economic and social development of 27 Latin American member countries. IADB headquarters are in Washington, D.C.

Intermediate Consignee

An intermediate consignee is the bank, forwarding agent, or other intermediary (if any) which acts in a foreign country as an agent for the exporter, the purchaser, or the ultimate consignee, for the purpose of effecting delivery of the export to the ultimate consignee.

International Air Transport Association (IATA)

The International Air Transport Association is a trade association serving airlines, passengers, shippers, travel agents, and governments. IATA headquarters are in Geneva, Switzerland.

International Anti-counterfeiting Coalition (IACC)

The IACC, founded in 1978, is a non-profit organization located in Washington, D.C. The JACC seeks to advance intellectual property rights (IPR) protection on a worldwide basis by promoting laws, regulations, and directives designed to render theft of IPR unattractive and unprofitable.

Freight Forwarder

An independent business that handles export shipments for compensation. The freight forwarder is among the best sources of information and assistance on the U.S. export regulations and documentation, shipping methods, and foreign import regulations.

Gateway

In the context of travel activities, gateway refers to a major airport or seaport. Internationally, gateway can also mean the port where customs clearance takes place.

GATT Panel

A panel of neutral representatives that may be established by the GATT Secretariat under the dispute settlement provisions of the GATT to review the facts of a dispute and render findings of GATT law and recommend action.

General Agreement on Tariffs and Trade (GATT)

A multilateral treaty whose purpose is to help reduce trade barrier between the signatory countries and to promote trade through tariff concessions.

General Exception

CoCom controls exports at three levels, depending on the item and the proposed destination. At the highest or “general exception” level, unanimous approval by CoCom members is necessary.

General Export License

Any of various export licenses covering export commodities for which Validated Export Licenses are not required. No formal application or written authorization is needed to ship exports under a General Export License.

General Imports

“General Imports” measure the total physical arrival of merchandise from foreign countries, whether such merchandise enters consumption channels immediately or is entered into bonded warehouses or Foreign Trade Zones under Customs custody.

Generalized System of Preferences (GSP)

The Generalized System of Preferences, GSP, is a framework under which developed countries give preferential tariff treatment to manufactured goods imported from certain developing countries. GSP is one element of a coordinated effort by the industrial trading nations to bring developing countries more fully into the international trading system. The U.S. GSP scheme is a system of non-reciprocal tariff preference for the benefit of these countries. The U.S. conducts annual GSP reviews to consider petitions requesting modification of product coverage and/or country eligibility. United States GSP law requires that a beneficiary country’s laws and practices relating to market access, intellectual property rights protection, investment, export practices, and workers rights be considered in all GSP decisions.

General Tariff

A tariff that applies to countries that do not enjoy either preferential or most-favored-nation tariff treatment. Where the general tariff rate differs from the most-favored-nation rate, the general tariff rate is usually the higher rate.

Global Export Manager

The Global Export Manager, GEM, is an electronic system for collecting and disseminating trade leads and business opportunities. GEM is maintained by the National Association of State Development Agencies (NASDA).

Global Quota

A global quota is a quota on the total imports of a product from all countries.

Gold Key Service

The Gold Key Service is an International Trade Administration service that provides customized information for U.S. firms visiting a country – market orientation briefings, market research, introductions to potential business partners, an interpreter for meetings, assistance in developing a market strategy, and help in putting together a follow-up plan. Trade Specialists design an agenda of meetings, screen and select the right companies, arrange meetings with key people, and go with U.S. representatives to ensure that no unfortunate difficulties occur.

Government Procurement Policies and Practices

The term refers to a non-tariff barrier to trade involving the discriminatory purchase by official government agencies of goods and services from domestic suppliers, despite their higher prices or inferior quality as compared with competitive goods that could be imported.

Grandfather Clause

The General Agreement on Tariffs and Trade (GATT) provision that allows the original contracting parties to exempt from general GATT obligations mandatory domestic legislation which is inconsistent with GATT provisions, but which existed before the GATT was signed. Newer members may also “grandfather” domestic legislation if that is agreed to in negotiating the terms of accession. (U.S. legislation also provides for “grandfather clauses.”)

Green Line. See: China Green Line

Grey List

This is a list of disreputable end users in nations of concern for missile proliferation from the intelligence community. Licensing officials in Commerce and State use this list as a cross- reference when reviewing export license applications for commodities listed in the MTCR Equipment and Technology Annex.

Gross Domestic Product (GDP)

A measure of the market value of all goods and services produced within the boundaries of a nation, regardless of asset ownership. Unlike gross national product, GDP excludes receipts from that nation’s business operations in foreign countries, as well as the share of reinvested earning in foreign affiliates of domestic corporations.

Gross National Product

A measure of the market value of goods and services produced by the labor and property of a nation. Includes receipts from that nation’s business operation in foreign countries, as well as the share of reinvested earnings in foreign affiliates of domestic corporations.

Gross Weight

The full weight of a shipment, including goods and packaging. Compare: Tare Weight.

Group of

Five Similar to the Group of Seven (G-7), with the exception of Canada and Italy. Seven This term refers to seven major economic powers (Canada, France, Germany, Great Britain, Italy, Japan, and the United States) whose finance ministers seek to promote balanced economic growth and stability among exchange rates. Ten Under the International Monetary Fund’s General Agreements to Borrow (GAB), established in 1962, 10 of the wealthiest industrial members of the 1MF “stand ready to lend their currencies to the IMF up to specified amounts when supplementary resources are needed.” The finance ministers of these countries comprise the Group of 10 (also called the Paris Club). Fifteen The G-l5, established in 1990, consists of relatively prosperous or large developing countries. The G-l5 discusses the benefits of mutual cooperation in improving their international economic positions. Members include: Algeria, Argentina, Brazil, Egypt, India, Indonesia, Jamaica, Malaysia, Mexico, Nigeria, Peru, Senegal, Venezuela, Yugoslavia, and Zimbabwe. Twenty-four A grouping of finance ministers from 24 developing country members of the International Monetary fund. The Group, representing eight countries from each of the African, Asian, and Latin American country groupings in the Group of 77, was formed in 1971 to counterbalance the influence of the Group of 10. Seventy-Seven A grouping of developing countries which had its origins in the early 1 960s. The numerical designation persists, although membership had increased to more than 120 countries. The G-77 functions as a caucus for the developing countries on economic matters in many forums including the United Nations.

Gulf Cooperation Council (GCC)

The six member countries (Saudi Arabia, Kuwait, the United Arab Emirates, Bahrain, Qatar, and Oman) of the Gulf Cooperation Council (GCC) control half the proven oil reserves outside the Soviet Union, and account for 40 percent of all the oil moving in international trade. The GCC was created in 1981, largely in response to the outbreak of the Iraq-Iran war. In creating the GCC, the members tried to maintain the balance of power in the Gulf by strengthening multilateral cooperation in security and economic matters. In regard to trade, the GCC is only a policy-coordinating forum; the Council cannot impose policies on members. GCC headquarters are in Riyadh, Saudi Arabia. The presidency of the GCC rotates yearly among the rulers of the member countries.

Harmonized System

The Harmonized Commodity Descriptions and Coding System (or Harmonized System, HS) is a system for classifying goods in international trade, developed under the auspices of the Customs Cooperation Council. Beginning on January 1, 1989, the new HS numbers replaced previously adhered-to schedules in over 50 countries, including the United States. For the United States, the HS numbers are the numbers that are entered on the actual export and import documents. Any other commodity code classification number (SIC, SITC, end-use, etc.) are just rearrangements and transformations of the original HS numbers.

Horizontal Export Trading Company

An export trading company that exports a range of similar or identical products supplied by a number of manufacturers or other producers. Webb-Pomerene Organizations, trade-grouped organized export trading companies, and an export trading company formed by an association of agricultural cooperatives are the prime examples of horizontally organized export trading companies.

Import Certificate

The import certificate is a means by which the government of the country of ultimate destination exercises legal control over the internal channeling of the commodities covered by the import certificate.

Import License

A document required and issued by some national governments authorizing the importation of goods.

Import Quota

A means of restricting imports by the issuance of licenses to importers, assigning each a quota, after determination of the total amount of any commodity which is to be imported during a period. Import licenses may also specify the country from which the importer must purchase the goods.

Import Quota Auctioning

The process of auctioning the right to import specified quantities of quota-restricted goods.

Import Restrictions

Import restriction, applied by a country with an adverse trade balance (or for other reasons), reflect a desire to control the volume of goods coming into the country from other countries. It may include the imposition of tariffs or import quotas, restrictions on the amount of foreign currency available to cover imports, a requirement for import deposits, the imposition of import surcharges, or the prohibition of various categories of imports.

Import Substitution

A strategy that emphasizes the replacement of imports with domestically produced goods, rather than the production of goods for exports, to encourage the development of domestic industry.

Foreign Traders Index

The foreign traders index is the U.S. and Foreign Commercial Service headquarters compilation of overseas contact file, intended for use by domestic businesses. The FTI includes background information on foreign companies, address, contact person, sales figures, size of company, and products by SIC code.

Forfaiting

Forfaiting is the selling, at a discount, of longer term accounts receivable or promissory notes of the foreign buyer. These instruments may also carry the guarantee of the foreign government. Forfaiting emerged after the Second World War to expedite finance transactions between Eastern and Western European countries. More recently, it has become popular in Asian countries and developing nations. Both U.S. and European forfaiting houses, which purchase the instruments at a discount from the exporters, are active in the U.S. market.

Forwarding Agent

The forwarding agent is the person in the United States who is authorized by the U.S. principal party in interest or, in the case of a routed transaction, the foreign principal party in interest to prepare and file the SED or its ABS electronic equivalent and/or perform the services required to facilitate the export of items from the United States. In routed export transactions, the forwarding agent and the exporter may be the same for compliance purposes under the EAR, but the forwarding agent is rarely the “exporter” in box 1 a of the SED or the exporter field of the ABS record. The forwarding agent serves a number of purposes, including arranging for transportation of the merchandise, packaging and, in some cases, is given Power of Attorney to fill out the required documentation for a particular shipment.

Foul Bill of Lading

A receipt for goods issued by a carrier with an indication that the goods were damaged when received. Compare: Clean Bill of Lading.

Framework Agreement

Food and Agricultural Organization

The FAO was established in 1945, as a specialized agency of the United Nations to combat hunger and malnutrition. The FAO serves as a coordinating body between government representatives, scientific groups, and non-governmental organizations to carry out development programs relating to food and agriculture.

Food For Progress

The Food for Progress program is carried out by the Department of Agriculture, using the authority of either Public Law 480 or Section 416 of the Agricultural Act of 1949. The program provides commodities to needy countries to encourage agricultural reform. In fiscal year 1991, no agreements were signed under the FFP program. Public Law 480 is a food aid and market development program that focuses on the needs of developing countries and is aimed at establishing a U.S. presence in such markets and supporting their economic growth. Section 416 of the Agricultural Act of 1949 provides for the donation of food and feed commodities owned by Agriculture’s Commodity Credit Corporation and is focused on people in developing countries.

Force Majeure

The title of a standard clause in marine contracts exempting the parties for non-fulfillment of their obligations as a result of conditions beyond their control, such as earthquakes, floods, or war.

Foreign Affiliate of a Foreign Parent

A foreign affiliate of a foreign parent is, with reference to a given U.S. affiliate, any member of the affiliated foreign group owning the U.S. affiliate that is not a foreign parent of the U.S. affiliate.

Foreign Agricultural Service

The Foreign Agricultural Service, FAS, is an agency of the Department of Agriculture. FAS maintains a global network of agricultural officers as well as a Washington-based staff to analyze and disseminate information on world agriculture and trade, develop and expand export markets, and represent the agricultural trade policy interests of U.S. producers in multilateral forums. FAS also administers USDA’s export credit and concessional sales programs.

Foreign Assets Control

The Treasury Department’s Office of Foreign Assets Control, OFAC, administers sanctions programs involving specific countries and restricts the involvement of U.S. persons in third country strategic exports, i.e., the Denied Parties List.

Foreign Assistance Act of 1991

This Act replaced the Support for East European Democracy (SEED) Act. The Foreign Assistance Act allows support to 26 countries, including all East European nations and most of the Soviet republics, but not to the Soviet Union itself

Foreign Availability

The Bureau of Export Administration conducts reviews to determine the foreign availability of selected commodities or technology subject to export control. The reviews use four criteria to determine foreign availability: comparable quality, availability in-fact, foreign source, and adequacy of available quantities that would render continuation of the U.S. control ineffective in meeting its intended purpose. A positive determination of foreign availability means that a nonU.S. origin item of comparable quality may be obtained by one more proscribed countries in quantities sufficient to satisfy their needs so that U.S. exports of such item would not make a significant contribution to the military potential of such countries. A positive determination may result in the decontrol of a U.S. product that has been under export control, or the approval of an export license. However, the control may be maintained if the President invokes the national security override provision of the Act. Beginning with the 1977 amendments to the Export Administration Act, the Congress directed that products with foreign availability be identified and decontrolled unless essential to national security. In January 1983, a program to assess the foreign availability of specific products was established within the Office of Export Administration, now the Bureau of Export Administration, or BXA. Further, 1985 amendments to the Act directed that an Office of Foreign Availability be created.

Foreign Buyer Program

Foreign Buyer Program, FBP, is a joint industry-International Trade Administration program to assist exporters in meeting qualified foreign purchasers for their product or service at trade shows held in the United States. ITA selects leading U.S. trade shows in industries with high export potential. Each show selected for the FBP receives promotion through overseas mailings, U.S. embassy and regional commercial newsletters, and other promotional techniques. ITA trade specialists counsel participating U.S. exhibitors.

Foreign Corrupt Practices Act

The FCPA prohibits U.S. individuals, companies and direct foreign subsidiaries of U.S. companies from offering, promising, or paying anything of value to any foreign government official in order to obtain or retain business.

Foreign Credit Insurance Association

The FCIA is an agency of the Export-Import Bank which offers insurance covering political and commercial risks on export receivables. FICA was founded in 1961 as a partnership of Eximbank and a group of private insurance companies. Eximbank is responsible for the political risk and may underwrite or reinsure the commercial risk. FCIA acts as an agent responsible for the marketing and daily administration of the program.

Foreign Direct Investment in the United States

Foreign direct investment in the United States is the ownership or control, directly or indirectly, by a single foreign person (an individual, or related group of individuals, company, or government) of 10 percent or more of the voting securities of an incorporated U.S. business enterprise or an equivalent interest in an unincorporated U.S. business enterprise,, including real property. Such a business is referred to as a U.S. affiliate of a foreign direct investor. See: Committee on Foreign Investment in the United States; Foreign Person; Portfolio Investment

Foreign Economic Trends

FETs are reports prepared by U.S. embassies abroad to describe foreign country economic and commercial trends and trade and investment climates. The reports describe current economic conditions; provide updates on the principal factors influencing developments and the possible impacts on American exports; review newly announced foreign government policies as well as consumption, investment, and foreign debt trends.

Foreign Exchange

The currency or credit instruments of a foreign country. Also, transactions involving purchase and/or sale of currencies.

Foreign Exports

Exports of foreign merchandise (re-exports), consist of commodities of foreign origin which have entered the United States for consumption or into Customs bonded warehouses or U.S. Foreign Trade Zones, and which, at the time of exportation, are in substantially the same condition as when imported.

Foreign Flag

A reference to a carrier not registered in the United States that flies the American flag. The term applies to air and sea transportation. See: Foreign Freight Forwarder; Freight Forwarder.

Foreign Independent Tour

A foreign independent tour, FIT, is a prepaid travel arrangement, tailored to meet a traveler’s specific wishes.

Foreign Investment. See: Committee on Foreign Investment in the United States;

Net Foreign Investment

Foreign Market Research. See: Industry Subsector Analysis

Foreign Market Value

The price at which merchandise is sold, or offered for sale, in the principal markets of the country from which it is exported. If information on foreign home market sales is not useful, the foreign market value is based on prices of exports to third countries or constructed value. Adjustments for quantities sold, circumstances of sales, and differences in the merchandise can be made to those prices to ensure a proper comparison with the prices of goods exported to the United States.

Foreign Military Sales. See: Conventional Arms Transfer

Foreign Parent

The first foreign person or entity outside of the United States in an affiliate’s ownership chain that has direct investment in the affiliate. The foreign parent consists ~j.y of the first person or entity outside the United States in the affiliate’s ownership chain; all other affiliated foreign persons are excluded.

Foreign Parent Group

A foreign parent group, FPG, consists of: (1) the foreign parent, (2) any foreign person or entity, proceeding up the foreign parent’s ownership chain, that owns more than 50 percent of the party below it, up to and including the ultimate beneficial owner (UBO), and (3) any foreign person or entity proceeding down the ownership chain(s) of each of these members, that is owned more than 50 percent by the party above it. A particular U.S. affiliate may have several ownership chains above it, if it is owned at least 10 percent by more than one foreign party. In such cases, the affiliate may have more than one foreign parent, UBO, and/or foreign parent group.

Foreign Person

A foreign person is any person resident outside the United States or subject to the jurisdiction of a country other than the United States. “Person” is any individual, branch, partnership, association, associated group, estate, trust, corporation, or other organization (whether or not organized under the laws of any State), and any government (including a foreign government, the U.S. Government, a State or local government, and any agency, corporation, financial institution, or other entity or instrumentality thereof, including a government sponsored agency.)

Foreign Policy Controls

Foreign policy controls are distinct from national security controls (CoCom or other international agreements) and are imposed to further U.S. foreign policy. The controls are typically imposed in response to developments in a country or countries — such as considerations regarding terrorism and human rights — or to developments involving a type or types of commodities and their related technical data. Foreign policy controls expire annually, unless extended.

Foreign-Owned Affiliate in the U.S.

A business in the United States in which there is sufficient foreign investment to be classified as direct foreign investment. To determine fully the foreign owners of a U.S. affiliate, three entities must be identified: the foreign parent, the ultimate beneficial owner, and the foreign parent group. All these entities are “persons” in the broad sense: thus, they may be individuals; business enterprises; governments; religious, charitable, and other nonprofit organizations; estates and trusts; and associated groups. An U.S. affiliate may have an ultimate beneficial owner (UBO) that is not the immediate foreign parent; moreover, the affiliate may have several ownership chains above it, if it is owned at least 10 percent by more than one foreign person. In such cases, the affiliate may have more than one foreign parent, UBO, and/or foreign parent group.

Foreign Sales Agent

An individual or firm that serves as the foreign representative of a domestic supplier and seeks sales abroad for the supplier.

Foreign Sales Corporation

A corporation created to secure U.S. tax exemption on a portion of earnings derived from the sale of U.S. products in foreign markets. To qualify for special tax treatment, a FSC must be a foreign corporation, maintain an office outside the U.S. territory, maintain a summary of its permanent books of account at the foreign office, and have at least one director resident outside the U.S.

Foreign Service

The Foreign Service supports the President and the Secretary of State in pursuing America’s foreign policy objectives. Foreign service functions include: representing U.S. interests; operating U.S. overseas missions; assisting Americans abroad; public diplomacy and reporting; communicating and negotiating political, economic, consular, administrative, cultural, and commercial affairs. The Foreign Service comprises officers from the Departments of State, Commerce, and Agriculture and the United States Information Service. See: Commercial Officers; Economic Officers

Foreign Service Institute (FSI)

FSI was founded in 1946 to train U.S. foreign and civil service officials. Training courses cover administrative, consular, economic, commercial, and political work, foreign languages, and diplomatic life overseas.

Foreign Trade Statistics Regulations (FTSR)

Legal definitions and requirements for SEDs and the AES, including information relating to the who, what, where, and when of the exportation.

Foreign Trade Zones (FTZ)

FTZs (or free zones, free ports, or bonded warehouses) are special commercial and industrial areas in or near ports of entry where foreign and domestic merchandise, including raw materials, components, and finished goods, may be brought in without being subject to payment of customs duties. Merchandise brought into these zones may be stored, sold, exhibited, repacked, assembled, sorted, graded, cleaned, or otherwise manipulated prior to reexport or entry into the national customs territory. FTZs are restricted-access sites in or near ports of entry, which are licensed by the Foreign-Trade Zones Board and operated under the supervision of the Customs Service. Zones are operated under public utility principles to create and maintain employment by encouraging operations in the U.S. that might otherwise have been carried on abroad. Quota restrictions do not normally apply to foreign goods stored in zones, but the Board can limit or deny zone use in specific cases on public interest grounds. Domestic goods moved into a zone for export may be considered exported upon entering the zone for purposes of excise tax rebates and drawback. “Subzones” are a special-purpose type of ancillary zone authorized by the Board, through grantees of public zone when it can be demonstrated that the activity will result in significant public benefit and is in the public interest. Goods in a zone for a bona fide Customs reason are exempt from state and local ad valorem tax. See: Free Trade Agreement; Free Trade Area

Export Management Company

A private firm that serves as the export department for several manufacturers, soliciting and transacting export business on behalf of its clients in return for a commission, salary, or retainer plus commission.

Export Merchant

A company that buys products directly from manufacturers, then packages and marks the merchandise for resale under its own name.

Export Processing Zone

Export Processing Zones are industrial parks designated by a government to provide tax and other incentives to export firms.

Export Quantity Verifications (EQV)

The physical verification of all cargo laden onboard a vessel.

Export Quotas

Specific restrictions or target objectives on the value or volume of exports of specified goods imposed by the government of the exporting country. These restraints may be intended to protect domestic producers and consumers from temporary shortages of certain materials, or as a means to moderate world prices of specified commodities. Commodity agreements sometimes contain explicit provisions to indicate when export quotas should go into effect among producers. Export quotas are also used in connection with the orderly marketing agreements and voluntary restraint agreements.

Export Restraint Agreements. See: Voluntary Restraint Agreements

Export Revolving Line of Credit

The Export revolving Line of Credit, ERLC, is a form of financial assistance provided by the Small Business Administration (SBA). The ERLC guarantees loans to U.S. firms to help bridge the working capital gap between the time inventory and production costs are disbursed until payment is received from a foreign buyer. SBA guarantees 85 percent of the BRLC subject to a $750,000 guarantee limit. The ERLC is granted on the likelihood of a company satisfactorily completing its export transaction. The guarantee covers default by the exporter, but does not cover default by a foreign buyer; failure on the buyer’s side is expected to be covered by letters of credit or export credit insurance. Under SBA’s ERLC program, any number of withdrawals and repayments can be made as long as the dollar limit on the line of credit is not exceeded and disbursements are made within the stated maturity period (not more than 18 months). Proceeds can be used only to finance labor and materials needed for manufacturing, to purchase inventory to meet an export order, and to penetrate or develop foreign markets. Examples of eligible expenses for developing foreign markets include professional export marketing advice or services, foreign business travel, and trade show participation. Under the BRLC program, funds may not be used to purchase fixed assets.

Export Statistics

Export statistics measure the total physical quantity or value of merchandise (except for shipments to U.S. military forces overseas) moving out of the United States to foreign countries, whether such merchandise is exported from within the U.S. Customs territory, a U.S. Customs bonded warehouse, or a U.S. Foreign Trade Zone.

Export Subsidies

Generally, direct government payments or other economic inducements given to domestic producers of goods that are sold in foreign markets. The GATT recognizes the export subsidies may distort trade, unduly disturb normal commercial competition, and hinder the achievement of GATT fair trade objectives; but it does not clearly define what practices constitute export subsidies. See: Subsidies

Export Trade Certificate of Review

A certification of partial immunity from U.S. antitrust laws that can be granted based on the Export Trading Company Act legislation by the Department of Commerce with Department of Justice concurrence. Any prospective or present U.S.-based exporter with antitrust concerns may apply for certification.

Export Trading Company

An export trading company, ETC, is a company doing business in the U.S. principally to export goods or services produced in the U.S. or to facilitate such exports by unaffiliated persons. The ETC can be owned by foreigners and can import, barter and arrange sales between third countries, as well as export.

Export Trading Company Act

The Export Trading Company Act of 1982: initiates the Export Trade Certificate of Review program that provides antitrust preclearance for export activities; permits bankers’ banks and bank holding companies to invest in ETCs; establishes a Contract Facilitation Service within the Commerce Department designed to facilitate contact between firms that produce exportable goods and services and firms that provide export trade services.

Export Transaction. See: Routed Export Transaction.

The U.S. party in interest takes on most or all of the export documentation responsibilities, including retaining a forwarding or other agent to act on their behalf