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SAP GTS - US Reexport Controls

Introduction: The U.S Department of Commerce regulates exports and re-exports of "dual-use" items through EAR (Export Administrative Regulations). If any controlled product is of U.S origin or in anyway connected with U.S then even if it's shipped anywhere from outside the U.S to any other countries, it should be compliant with EAR and require a license from the U.S BIS (Bureau of Industry and Security). When a foreign-based company imports products or components from the U.S and uses them in its production, and then exports the produced materials to another country, the process is known as U.S. Re-export and is subject to U.S. regulations.  Firstly, we need to determine if any foreign-produced materials that contains the U.S origin components are subject to EAR or exempted based on the de-minimis exception. Here the ultimate destination countries are classified as "Non-Critical / Friendly Countries" and...
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Introduction to SAP GTS


Introduction to SAP GTS: 
  • SAP GTS stands for SAP Global Trade Services.
  • SAP GTS is an ERP software from SAP Labs. (A German Company)
  • SAP GTS helps to automate the global trade business of any organization. 
  • Stand-alone application which replaces the SAP ECC SD-Foreign Trade Functionality
  • In today's complex, constant evolving country specific trade regulations it is helpful for the companies to go with such a stand-alone ERP tool.

History of SAP GTS:
  • SAP GTS, edition for SAP HANA (E4H) is the latest version which was released in the year 2020.
  • SAP GTS 11.0  - SP21 is the latest release in SAP GTS 11.0 version.
  • SAP GTS E4H is soon expected to replace SAP GTS 11.0.
  • SAP is expected end its support/maintenance for SAP GTS 11.0 by December 2025.
  • Companies going for fresh GTS implementation could go for SAP GTS E4H directly and companies already in SAP GTS 11.0 can plan to upgrade to SAP GTS E4H in future to have the continuous support from SAP.
Architecture:
  • SAP GTS can be integrated with any feeder system like SAP R/3 ECC or SAP S4 HANA system through RFC (Remote Function Call) to screen and process any outbound (Order to Cash, OTC) / Inbound (Procure to Pay, PTP) transactions.
  • Master data (Customers, Vendors, Contact Persons, Materials, BOM's, etc..) from the feeder system will be shared with the SAP GTS.
  • Data can be transferred from SAP ECC to SAP GTS or Vice versa through RFC.
  • SAP GTS can be connected to Customs system via any certified customs interface (for ex, US AES/ABI, DE ATLAS, GB CHIEF/CDS, FR DELTA, NL DMS) through any customs approved middleware like Seeburger/SAP PI/any other approved software.
Benefits in SAP GTS:
  • Ensure Compliance - It helps the organization to ensure the compliance has been met in any transaction through denied party lists screening, embargo screening and license check.
  • Automation - Automation the import/export business speeds the global trade functions like customs self-filing through Seeburger/any other customs authorized middleware interface.
  • Eliminate Risks - Eliminate the trade penalties, reduce the duty costs through right free trade agreements 
  • Reduce Costs - Broker fees can be avoided through self-filing, Duty benefits through FTA / any special customs procedures like Bonded Warehouse, Foreign Trade Zone, FTZ (US)/ Inward/Outward Processing and optimize the global trade business. 
  • Accurate Classification - Make sure the classification is correct and up-to date as per the country requirement. Classification contents can be procured from the Data content Providers like Descartes.

Three Main modules in SAP GTS: 
  1. Compliance Management - Which covers Sanctioned Party List Screening (SPL), Embargo, Legal Control (Licensing), Product Classification (ECCN/Control Codes). 
  2. Customs Management - Which covers Product Classification (HS Codes), Import, Export - Transit/Customs processing through Broker / self-filing, Customs Forms Printing. 
  3. Risk Management - Which covers Preference management (FTA), Letter of credit (LOC), Restitution. 
  4. Electronic Compliance Reporting (ECR) - Which covers Intrastat declarations / Reporting. 
Conclusion:
        SAP Global Trade Services module has a great scope amidst the organizations doing import/export business. SAP GTS is widely used across all the industries like Chemicals, Pharma, Electronics, Automobile, IT, Telecommunications, Semiconductors, etc...


For any queries/suggestions/corrections please drop a message. Happy Learning...                         
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