Advanced export control overview
Your organization must keep track of many rules and policies when it trades internationally with goods or services that are subject to external regulations and internal policies. Before you begin the process of confirming, picking, packing, shipping, and invoicing a sales order, you can manage, track, and verify compliance with export control restrictions.
You can manage export control policies with a native Dataverse solution that connects directly with your Dynamics 365 Supply Chain Management instance. Next, Supply Chain Management ensures adherence to global trade laws by continuously reviewing your export control guidelines.
The system uses a built-in Microsoft Dataverse solution that connects directly with your Supply Chain Management. This setup checks your export control rules in real-time to comply with international trade regulations.
Because Dataverse is widely connected, other systems you use can also access these export control rules. Additionally, you can use Microsoft Power Platform features to customize and extend the solution, allowing your export control administrator to create complex formulas, similar to using Microsoft Excel.
Five primary concepts implemented in the Dataverse solution are:
Jurisdiction
Codes and categories
Restrictions
Exceptions
Licenses
Jurisdiction
A jurisdiction consists of codes, categories, restrictions, exceptions, and licenses that represent a set of configurations that apply to incoming requests. The Dataverse solution associates a set of rules with each jurisdiction to indicate when someone applies a set of configurations. Moreover, you can create a rule as an error, meaning that any activity that fits the rule is blocked for the jurisdiction under which the rule was set up if no exceptions exist for that rule. Typically, a rule consists of a combination of a country/region, a purpose for the transaction, and a set of codes and categories. Jurisdictions don't need to be region or country-specific, and you can set up jurisdictions to specify export activities based on your company's policies.
Codes and categories
Export Control Classification Numbers (ECCNs) are the codes that make up a jurisdiction. Your company might use Harmonized System (HS) codes if you need to deal with customs scenarios. You can link a code to one or more control categories, such as Missile Technology or National Security. This set of codes and categories are unique for each jurisdiction. However, each ECCN can be part of zero or more control categories, and each control category can contain many ECCNs.
For example, the code 7A994 is an ECCN that US Export Administration Regulations (EAR) defines. According to the regulation, this ECCN is for "Other navigation direction finding equipment, airborne communication equipment, all aircraft inertial navigation systems not controlled under 7A003 or 7A103, and other avionic equipment, including parts and components." According to EAR, the ECCN 7A994 code is part of the Anti Terrorism (AT) control category.
Because export control jurisdictions specify ECCNs and control categories, one ECCN can appear in more than one export control jurisdiction. As such, it's important to specify which jurisdiction code you're referencing.
Restrictions
Jurisdictions also define a set of restrictions that specify which export actions shouldn't be permitted unless an exception is made. A restriction includes the following components:
A set of ECCNs
Control categories
Country/region
Transaction purpose
Commonly, you define restrictions in terms of a commerce country/region chart. Download the Commerce Control List Overview and the Country Chart from the US EAR for an example of similar restriction definitions.
According to the defined rule, if an order includes items that have an ECCN that belongs in the MT or NS control categories, the system blocks the sale to Angola. Essentially, if a user tries to confirm an order that has one of these items for shipment to Angola, the system blocks the action and the user receives an error message. The following example shows a restriction that's set up from within the Export control app.
Exceptions
Use exceptions in edge cases to allow an action that a restriction might otherwise block. Typically, exceptions come in the form of blanket exemptions or corporate policies. You would define these exceptions similarly to restrictions. They also provide extra requirements that apply if or when someone uses the exception. The following example shows the setup for an exception within the Export control app.
Licenses
International authorities might issue licenses to provide a company with specific permission to trade in one or a set of restricted items in a certain context. Commonly, companies specify the license under which an item can be traded on each transaction that contains it.