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About the Author

J. Anthony Hardenburgh
Vice President, Global Trade Content
Amber Road


J. Anthony Hardenburgh brings over 12 years of international trade experience to Amber Road where he manages a global team of international trade professionals who monitor and maintain the company’s vast amount of trade compliance content. Prior to joining Amber Road, Anthony served as Vice President of Global Trade Content for JPMorgan Chase Vastera. During his six years with the company he managed a global team of trade professionals responsible for supporting both its software and managed services operations. Previously, Anthony served as a Director for From2, a global trade management company located in Miami, FL. Prior to From2, Anthony served as an International Trade Specialist for the US Department of Commerce. As an International Trade Specialist he was responsible for counseling small to medium size exporters on exporting their goods and services. Anthony has a Bachelor in International Business from Virginia Polytechnic Institute & State University and an MBA from Marymount University. 

For more information, please visit www.amberroad.com


Supply Chain Comment

By J. Anthony Hardenburgh, Vice President, Global Trade Content, Amber Road

February 27, 2014



Are You Ready For the Trans-Pacific Partnership?

Expected to Increase Competitiveness of U.S. Exports, Helping Companies Grow Their Businesses Worldwide


Hardenburgh Says:

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The vast economic scope of the Trans-Pacific Partnership means companies could reap large cost savings utilizing the program. However, timely, accurate data and efficient, repeatable processes are required to maximize benefits of the program.
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The Trans-Pacific Partnership (TPP), a free trade agreement (FTA) among 12 countries, is expected to pass this year – and could have enormous consequences for world trade.

The FTA agreement encompasses 12 countries, including Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States, and Vietnam comprising approximately 40 percent of world GDP, equivalent to $27.5 trillion annually.1 

(1. http://www.international.gc.ca/trade-agreements-accords-commerciaux/agr-acc/tpp-ptp/index.aspx?lang=eng)

The agreement, in effect, can be considered a unification of the Trans-Pacific Strategic Economic Partnership (a 2005 agreement between Brunei, Chile, Singapore and New Zealand) with NAFTA (the United States, Mexico and Canada) with the addition of Malaysia, Vietnam, Japan, Australia and Peru.

The negotiations also deal with the increased control and regulation of intellectual property (IP), copy right laws, and patenting enforcement and may become a milestone for future FTA negotiations, as countries have different interpretations and understandings of how IP should be protected.

Passage of the TPP is expected to increase competitiveness of U.S. exports, helping companies grow their businesses worldwide and might also jump start other trade negotiations with the European Union and China.

However, companies need to have the appropriate structure in place to take advantage of TPP. To fully utilize TPP, companies must have knowledge, flexible architecture, and accurate record keeping.


 
1.

Knowledge

 

 

 

Up to date trade information, such as harmonized tariff schedules, rules of origin, product classifications, taxes and duty rates, is needed to take advantage of TPP. Not only must this data, which comes from multiple different sources, be comprehensive and up to date, you also need to be able to access it quickly. Further, information on product eligibility needs to be obtained from your supplier of origin. Shippers must identify which products may be eligible for preferential treatment, based on Harmonized Schedule (HS) classification and source country. Two ways to streamline and more easily access the information required for eligibility include access to a comprehensive trade database and using a supplier portal, where suppliers can enter information directly into the system.


 
2.

Flexible and easy to use structure and processes

 

 
 

For manufacturers of finished goods, it can be challenging to analyze each product’s bill of material (BOM). Once analyzed, you should tie those qualification results back to the product record for a complete, centralized view of each item. Qualifying and managing thousands of products can be difficult without automation. Consider automating the supplier solicitation, qualification and certificate management processes for large volumes to minimize effort and eliminate hours of manual work, decreasing operational expenses. Additionally, your TPP qualification process should be scalable and repeatable – i.e., it should work for multiple trade agreements. Currently the United States has free trade agreements (FTAs) with 17 countries. Once your TPP qualification framework is in place you should be able to support other trade agreements quickly and easily. 

 
 
3. Accurate record keeping

  Global trade data rapidly changes and comes from a number of countries and government agencies, differences in trade regimes, and in a wide variety of formats. Inconsistent message formats, terminology and codes add to the complexity. This data must be collected, cleansed and normalized for use across multiple parties before it can be used. To be eligible for TPP, companies must be able to demonstrate proof of compliance. Companies need accurate and consistent product classification for multiple countries and products, including managing certificates of origin and their expirations, renewals and revisions. If a new certificate of origin is required, you should be able to generate and republish it, while maintaining prior versions for audit purposes. If a change results in the product losing its FTA eligibility, appropriate steps can be taken to contact customers, withdraw the certificate and distribute a new one.


Final Thoughts


In conclusion, the vast economic scope of the Trans-Pacific Partnership means companies could reap large cost savings utilizing the program. However, timely, accurate data and efficient, repeatable processes are required to maximize benefits of the program.

 


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