Restricted party screening

Restricted party screening: key to global compliance

By Camille Felappi

You would probably never sell your goods to a terrorist organization intentionally. But do you know who is this customer on the other side of the world who just added your goods to his shopping cart? This is what restricted party screening is all about.

 

Any time you conclude a sale, you need to verify that you do not conclude it with an individual or an organization that can’t to do business. Overwise, you risk severe penalties.

The same applies to prohibited items screening. Any time you conclude a sale, you need to verify that you can export your goods in the customer’s country. The goods authorized to enter national borders differ from one country to another. And severe penalties await you if you break the regulations.

Restricted party and prohibited items screenings are therefore essential when you trade across borders. However, processing those screenings manually any time you sell an item is impossible. This is why automated solutions like Eurora’s Restrictions Screening service are here to help you.

 

What happens if you do business with a restricted party?

If you are not using an automated restricted party screening solution, you are most likely not checking on your customers. However, you shouldn’t skip over compliance. Consequences can be devastating for your business. You can usually find terrorist organizations or international criminals on restricted party lists. Sanctions applied if you sell goods to such customers are thus very serious.

Non-compliance with denied party list or restricted party list can lead to penalties that are not only monetary. It can even lead to jail time. Besides, you can also lose your export license and damage your reputation. If the media find out that you sold goods to a criminal organization, you will get bad press.

No one wishes to lose his entire business for unknowingly selling a product to a terrorist organization. Would you?

 

What is restricted party screening?

International organizations and national governments closely monitor cross-border trade. They determine individuals and companies with whom sellers are not allowed to trade. As a seller, it is your responsibility to know these regulations. And to avoid selling your goods to a terrorist organization.

Those restricted individuals or companies appear on what we call restricted party lists, also known as denied party lists. Denied party lists are both international and country-specific. For example, the United Nations have a denied party list. Besides, each country has its own list. For example, in the US, the Bureau of Industry and Security oversees the US denied party list. This means that there are hundreds of denied party lists, and they are constantly updated.

To make sure you are not selling your goods to any criminal organization; you need to conduct a restricted party screening for each sale. The restricted party screening process can be done manually or automatically. And you could be tempted to do it manually: after all, denied party lists are publicly accessible.

But if you are selling several goods a day to several markets, that would look like a real nightmare. Imagine having to find every national and international restricted party list. Going over all of them anytime you receive one order, and even having to follow the updates of each list. This would be insanely time-consuming. And you would waste all your energy in bureaucracy instead of focusing on your main activity.

Luckily, automated restricted party screening solutions exist. Eurora can automatically check on all your customers while they are shopping on your website. Check out our Restrictions Screening service!

 

What about prohibited and restricted items?

When it comes to global trade compliance, not only the people are regulated, but also the items you export. Each country’s customs agency has its own rules. They define what you can or can’t import into their territory. They also determine if some items need a special license or permission.

It works the same as for restricted party lists. Countries add those items to what we call prohibited and restricted item lists. To make sure you can export your goods, you should therefore conduct a restricted item screening. And this, each time you conclude a cross-border sale.

Now you might think that you don’t need to screen your items if you are not exporting firearms or chemicals. But you would be surprised to know all the restrictions that apply to many products. For example, leather shoes appear on the restricted items list of many countries.

It is your responsibility to make sure you respect those export compliance rules. Customers are rarely aware of the regulations that apply in their countries. So they will buy your products even if there are restrictions.

And the sanctions you face if you break these regulations are as damaging as for restricted party screening. They also imply high fines and jail time. And on top of that, you will get bad customer reviews, because they will never receive their goods. The goods will be blocked in customs, and it will damage your reputation.

Prohibited and restricted item screening can be done manually or automatically with the help of a tool like Eurora. Just like restricted party screening. Needless to say, restricted item screening is impossible to handle manually if you are selling your goods around the globe.

 

Automate your screenings with Eurora

At Eurora, we believe that eCommerce should be freed from complex trade regulations. Therefore, we developed a fully automated Restrictions Screening service. Our Restriction Screening service includes both restricted party screening and restricted item screening.

Our solution will save you time and relieve you from international sanctions risk. It is automated and very easy to use. You just need to add the service to your website’s shopping cart via our API. All the checks on goods will be run automatically in less than one second.

Besides, our database covers restricted party and item lists for most countries in the world. And we automatically save all screening results to avoid future issues with authorities. We will make sure that you avoid high fines and that customs don’t confiscate your goods.

Want to automate your export compliance and avoid legal sanctions? Get in touch with us!