By Jackson Wood, Director, Industry Solutions, Trade Compliance, Descartes Systems Group
Global Trade Management (GTM) technology solutions have been part of the international trade landscape for over 20 years. During that time, organizations have realized significant value through the implementation and ongoing operation of GTM systems. At the same time, GTM vendors like SAP, Oracle, e2Open, and others have invested significantly to expand their capabilities.
GTM systems are software platforms that help businesses manage and streamline their international trade operations. These systems provide a comprehensive set of tools and functionalities to facilitate various aspects of global trade, including import/export compliance, logistics and transportation management, customs and trade documentation, trade finance, and regulatory compliance.
GTM software solutions also play a crucial role in enabling businesses to navigate the complexities of international trade, enhance operational efficiency, reduce risks, and ensure compliance with global trade regulations. These systems are especially valuable for companies engaged in cross-border trade and dealing with a high volume of international shipments. However, to be truly effective, GTM Software needs to be integrated with the latest trade and compliance information.
The Role of Global Trade Content
One thing that has remained a constant during the lifecycle of GTM systems has been their need to ‘consume’ global regulatory content like harmonized tariff system (HTS) codes, free trade agreement rules of origin (ROO) and sanctioned party lists (SPL) in order for the ‘rules’ and ‘workflows’ of the system to work properly.
Speaking more specifically, global trade content refers to preconfigured data and rules that help facilitate global trade operations within the GTM system. It includes a wide range of information related to customs regulations, duties, tariffs, trade agreements, restricted party lists, and other trade compliance requirements.
Trade content in GTM systems typically consists of – but is not limited to – the following components:
This includes data related to customs procedures, regulations, and documentation requirements for various countries or regions. It covers information such as harmonized tariff system codes (HTS codes), customs duty rates, import and export restrictions, and customs clearance processes.
Legal Control Content
This component focuses on trade compliance regulations and embargoes. It includes restricted party lists (such as denied party lists or embargoed country lists) provided by government agencies or international organizations. The content helps screen business partners and transactions against these lists to ensure compliance with trade regulations.
Preference content involves trade agreements and preferences provided by different countries or trade blocs. It includes information on preferential duty rates, rules of origin, and product-specific requirements to determine eligibility for preferential treatment under specific trade agreements.
Product Classification Content
This component assists in product classification based on various classification systems such as the Harmonized System (HS) or the Schedule B. It includes product descriptions, attributes, and associated codes that help determine the correct tariff codes and other regulatory requirements for goods.
Sanctioned Party List Content
This content provides information on individuals, organizations, or countries subject to economic sanctions. It helps identify and prevent transactions involving sanctioned parties.
Customized Content Sets
This content includes information not formally published by government bodies, but rather curated and synthesized by specialized research companies to add additional value to the capabilities of GTM systems. This can include data sets like Adverse Media coverage, Sanctioned Ownership structures, and Politically Exposed Persons (PEPs) that help companies using GTM systems to enhance the automated due diligence workflows native within the solutions.
How is Global Trade Content Created
Obviously, the trade content used in GTM systems must be regularly updated to ensure compliance as trade regulations and requirements are constantly being modified by global regulators. Most GTM vendors collaborate with external content providers like Descartes to obtain and integrate the latest trade content into the GTM system.
Leading vendors work diligently to ensure that quality control of Global Trade Content is an integral part of the data gathering and synthesis process. Key aspects of global trade content quality control include:
- Data Accuracy: It is crucial to ensure that trade content data, such as customs regulations, duty rates, and trade agreements, are accurate and up to date. This requires regular monitoring and verification of data from reliable sources, such as government agencies or trusted third-party providers.
- Data Completeness: Trade content should provide comprehensive information to support trade operations. This includes complete and detailed product descriptions, harmonized system codes (HS codes), and relevant documentation requirements. Quality control involves validating the completeness of data elements to avoid errors and omissions.
- Source Authentication: It is important to verify the authenticity and reliability of the sources providing trade content. Validating the credibility of data sources helps ensure the quality and integrity of the information used for trade processes.
- Continuous Monitoring: Trade content quality control is an ongoing process. It requires regular monitoring and updating of trade data to reflect changes in regulations, duty rates, and trade agreements. This ensures that trade operations are based on the most current and accurate information available.
How is Global Trade Content Delivered?
Once high-quality global trade content has been created, it can be delivered through various methods and formats to cater to different business needs and systems. Here are some common delivery methods for global trade content:
- Online Platforms: Many companies rely on online platforms or portals to access and retrieve trade content. These platforms provide access to comprehensive databases that contain trade regulations, customs duty rates, product classifications, and other relevant information. Users can access the content through web browsers and search for specific trade-related data.
- Data Feeds/APIs: Trade content providers often offer data feeds or APIs (Application Programming Interfaces) to deliver trade content directly into a company’s internal systems. Through APIs, businesses can integrate global trade content seamlessly into their trade management software, ERP systems, or other applications. This enables real-time access to updated trade information and facilitates automation of trade processes.
- Software Integration: Some trade content providers offer software solutions that integrate trade content directly into existing trade management systems. This integration allows companies to access relevant trade data within their familiar software environment, enhancing efficiency and accuracy.
- Data Files: Trade content can be delivered as downloadable data files, typically in standardized formats such as Excel, CSV (Comma-Separated Values), or XML (Extensible Markup Language). These files contain structured trade data that can be imported into internal systems for further analysis and processing.
The choice of delivery method depends on factors such as the specific requirements of the business, the level of automation desired, the integration capabilities of existing systems, and the frequency of content updates needed. Businesses often select a delivery method that aligns with their operational processes and facilitates efficient access to accurate and timely trade content.
Partner with Descartes for Accurate Global Trade Content
High quality global trade content enables businesses to perform trade-related activities more efficiently and accurately through their GTM system, minimizing the risk of non-compliance and facilitating smooth global trade operations.
Descartes is an industry leader in trade intelligence, and a strategic enabler for global trade compliance companies. We help ensure that customers have access to the most accurate and up-to-date global trade management content. The information is engineered in a way that produces output customers can rely on to add value to their business.
Our solutions can add value to a wide range of ERP systems including SAP and Oracle, as well as cover integrated denied party screening including customized content such as sanctioned ownership screening, adverse media coverage and PEPs.
Request a demo by contacting our global trade content specialist today.