By Andrea Ewart |  CEO and Founder | DevelopTradeLaw, LLC

In today’s digital economy, it is possible to participate in international trade without ever leaving our desks. This reality is particularly true for attorneys and clients who frequently do business internationally, and  presents several opportunities and challenges. Attorneys need to be prepared to support clients as well as to address their own needs in this era of doing business without borders.

The Opportunities

Today’s technology facilitates the delivery of services to overseas clients without requiring that you board a plane or present a passport. Anyone who has sent an email or participated in a video conference where they imparted advice or shared their work products to a client located in another country has participated in the cross-border delivery of services – a component of international trade.

Furthermore, a company with a website is a global company! There are over 4 billion Internet users world-wide and a significant portion of them use the Internet to purchase goods and services, making e-commerce the fastest growing area of business activity. According to Forrester Research, B2B e-commerce is more than twice the size of online retail commerce and is also growing more rapidly. The research firm, Frost and Sullivan forecasts that by 2020, the B2B online retail market will be double the size of the B2C online market and globally will generate revenues of US$6.7 trillion.  Therefore, an attorney or their client who has previously only operated within the U.S. could find themselves doing business with an international client for the first time simply through an email inquiry from their website.

Trade agreements into which the United States has entered also create opportunities for US businesses. In particular, companies may have gained the ability to participate in procurements by foreign governments on the same level playing field as national companies. Interested companies should proactively determine where the U.S. has negotiated these preferential terms for the entry of US companies and any rules that may apply in seeking these opportunities.

The Challenges

Despite the ease of participating in cross-border trade, the legal and regulatory requirements of national governments remain intact. Violations can carry huge civil penalties (or jail time) and even the possibility of being temporarily barred from exporting. Consequently, it is important to be prepared even before the arrival of that first call or email from an international client or prospect.

Here are some key considerations for attorneys and their clients:

• How do I ensure that the company and/or agents overseas comply with anti-bribery laws?

When doing business overseas it is essential to comply with U.S. anti-bribery laws and those of the countries in which the company has a presence. Specifically, the U.S. Foreign Corrupt Practices Act (FCPA) prohibits providing anything of value to overseas government officials for purposes of winning or retaining business. Questions that need to be asked and answered include: Who is a government official? Are all payments prohibited? Are gifts allowed? It is important to get these answers right as penalties can be as high as $2 million per violation and corporate officers could be fined and/or jailed.

• What steps should I take to ensure that the company gets paid?

A good contract is important in any transaction. When doing business internationally, additional considerations include provisions that address the currency in which you will get paid and who bears the risk of such unforeseen events as changes in currency or law. Also, in the event of disputes whose law will govern? How can you minimize the company’s liability for the actions of its agents overseas that may violate U.S. and other laws?

• Will a license be required to export the product or service?

While the U.S. maintains few legal requirements on exports, it is illegal to do business with some countries without a license. Cuba, Iran, and Syria may immediately come to mind. There is also a broader list of countries which U.S. persons need to approach with caution because of prohibitions on doing business with individuals or companies located there. Finally, the export of seemingly innocuous items such as airport body scanners and underwater oxygen tanks may require a license for export because of US national security concerns. For the same reason, the transfer of data related to these controlled items to any non-US person is also an export. Penalties start at $250,000 per violation and may extend to imprisonment and denial of export privileges. It is  prudent to consult legal counsel about how your company or a client’s company can best avoid or mitigate these penalties.

• How can these challenges be managed?

A company with any interest in or potential for doing business internationally needs an effective International Trade Compliance Policy. The policy helps the company to be prepared by providing a clearly articulated policy and set of internal guidance and procedures that provide answers before they are needed. It is an essential tool to foster a culture of compliance with the rules of doing business internationally and helps you reap the benefits of our shifting global economy.

Andrea M. Ewart, Esq. is the founder and owner of DevelopTradeLaw, LLC, a law firm based in Washington, D.C., which provides custom-tailored, cost-effective, and business-oriented solutions to the legal challenges that face companies doing business internationally.