Export Compliance Program

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Export Compliance Program
Industry-Government Seminar on Strategic Trade
Management Dusit Thani Hotel, Bangkok,
Thailand 22 October, 2008
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Seagate Around the World
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Elements of Seagates Export Compliance Program

• Executive Commitment
• Defined Roles
• Written Procedures
• Classification of Product
• License Process
• Restricted Parties Screening

• Training
• Accountability/Audit
• New Business Initiatives
• Customer Support
• Recordkeeping

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Defined RolesInternational Trade Administration
Department
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ITA Key Responsibilities

• Ensure Seagates compliance with global trade
  regulations
• Global trade compliance strategic planning
• Establish trade compliance policy and procedures
  and facilitate understanding
• Facilitation of cross-border supply chain
  opportunities
• Represent Seagate with various government trade
  agencies and advisory services.

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Executive commitment to and support for trade
compliance

• Absolutely critical to success of the program
• Annual Issuance by CEO and CFO regarding Employee
  Responsibilities to comply with Export Controls
• Comprehensive International Trade Compliance
  Policy

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Seagates Trade Compliance Policy

• Seagate is committed to a strong International
  Trade Compliance Policy.
• All employees are responsible for following the
  International Trade compliance procedures, and
  for reporting known or apparent import/export
  irregularities to the International Trade
  Compliance Officer, or ITA management
  representatives.
• The knowing or negligent failure to comply with
  the various International Trade Regulations
  subjects Seagate and its employees to sanctions,
  substantial fines, penalties, possible
  imprisonment, and loss of import/export
  privileges.

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Written procedures

• ITA has compiled a Compliance Procedures Manual
  that contains all import and export procedures.
• a living document and is updated as necessary, as
  well as an annual review of the content.
• in electronic form for ease of updating
• leverage governmental resources via links in the
  document

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Classification of Product

• Seagate product
• Electronic database of commodity (and HTS)
  classification for all Seagate part numbers.
• Seagate engineers provide technical support to
  ITA in order to properly classify its products.
  This support is essential in determining the
  export eligibility of Seagate product.
• Seagate ITA has a process by which we request
  commodity classifications from the US government.
• Vendor product
• We work closely with our vendors to ensure that
  we have current and accurate commodity
  classifications for products supplied by vendors.

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License Process

• Seagate ITA has a clearly defined process to
  apply for export licenses whenever required.
• It is essential to communicate with business
  units that receive licensed items so that Seagate
  can be sure to comply with any conditions that
  the government placed on the export of the item,
  such as no reexport.
• License documents are maintained in both physical
  and electronic form.

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Restricted Parties Screening and Embargoed
Countries

• Seagate uses an automated system purchased from a
  vendor to process all shipments.
• The system screens all shipments, including those
  from non-US ports, for various anomalies
• Embargoed or sanction countries
• Certain end-uses
• Restricted parties Lists
• All possible or actual matches are referred to
  ITA for resolution

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Restricted Parties Screening and Embargoed
Countries - continued

• Information that comes to sales staff about
  end-user is also subject to screening for
  restricted countries and parties.
• Training of employees to recognize embargoed
  countries and prohibited end uses.
• Addressing restricted parties at that level is
  more of a challenge.

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Training

• Aggressive Training Program
• High-level awareness training provided on first
  day of employment for all Seagate employees
• Mandatory compliance curriculum for all managers
  includes a separate export compliance course.
• Export compliance course is assigned to other
  personnel on an as-needed basis
• Specific training in person or via webinar for
  certain groups
• Sales
• Logistics
• Shipping
• Procurement
• Engineering

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New Business Initiatives

• ITA needs to be aware of internal changes in
  order to ensure continuing compliance
• Mergers and Acquisitions
• ? new business unit exports via download
• ? integrate new units into existing process
• Changes in Business model
• ? move to direct sales and E-commerce
• New Products
• ? ensure proper jurisdiction and classification

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Customer Support

• Seagate spreads the word on export compliance to
  its customers
• Includes trade compliance language in contracts
• Provides commodity classification to customers
  on shipping documents and upon request
• Advises authorized distributors of export
  compliance obligation on an annual basis
• Ensures that all customer data collected by
  Seagate is screened for restricted countries and
  parties.

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Accountability and Audit

• ITA conducts an annual audit of its shipping
  sites to ensure that all processes and procedures
  are being followed.
• Conducts self-audit of ITA procedures utilizing
  US government guidelines
• Seagate promptly and thoroughly investigates any
  situation that might be contrary to export laws
  and regulations.

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Recordkeeping

• Complies with all government mandates for record
  keeping
• Most documents stored electronically but
  retrievable
• Require all service providers to maintain records
  in compliance with Seagate policy (which may in
  some instances exceed regulatory requirement)

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• Questions?