Solution OverviewSAP Solutions for GRC

SAP GRC GLOBAL TRADE SERVICES

SECURE AND STREAMLINE CROSS-BORDER TRANSACTIONS

TRADE IS GOING GLOBAL

CAN SUPPLY CHAIN PROCESSES KEEP PACE?

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Markets are going global more rapidly than ever. Todays enterprises

increasingly buy, sell, and outsource around the world. The opportunities

in this global marketplace are immense. But without effective IT support,

leveraging them is far from easy.

SAP can help. The SAP GRC Global Trade Services application helps

companies manage the many diverse challenges of international trade.

Built on the latest SAP technologies and drawing on more than 30 years

of vertical industry and global trade experience, the application enables

enterprises to automate and streamline complex import and export processes,

ensure full regulatory compliance, expedite customs clearance, mitigate the

financial risk of global transactions, and take full advantage of international

trade agreements.

Companies making strategic investments in global systems to better manage

and synchronize logistics, compliance, and trade finance as an integrated

process are making great headway, often decreasing total landed costs and

delayed shipments by 10% to 40%.

Beth Enslow, Vice President of Enterprise Research, Aberdeen Group (from New Strategies for Global Trade Management, Aberdeen Report, March 2005)

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Cross-border transactions are becom-ing ever-more complex, involving a large number of partners, regulatory bodies, and authorities, all generating greater volumes of data and docu-mentation. At the same time, pressure to accelerate inbound and outbound deliveries is growing as are the re-quirements for regulatory compliance. Authorities are now expanding their reach beyond their home-country bor-ders by checking compliance at the for-eign site. These factors add to existing pressures to reduce supply chain costs and improve cash flow. They demand more accurate, up-to-date information from many disparate systems.

Complying with Regulatory Requirements

With the increased focus on security risks, export and import processes are under closer scrutiny than ever before. Organizations doing business with part-ners overseas want to ensure they are dealing with the right people, countries, and products. To avoid hefty fines and damage to their reputation, these organizations must be able to deter-mine quickly and reliably whether transactions are compliant with ever-changing regulatory rules and, if necessary, take appropriate steps to correct them.

COMPLEX NEW CHALLENGES

AND THE SEARCH FOR NEW SOLUTIONS

SAP maintains its leadership position in the GTM market, with over

500 clients using its solution. SAP GRC Global Trade Services is part of

SAPs governance, risk, and compliance [GRC] business unit, which was

announced in May 2006. The formation of this business unit, coupled

with the broader GRC solution footprint and value proposition, has

been a key factor in SAPs continued success in this market.

Adrian Gonzalez, Director, Logistics Executive Council, ARC Global Trade Management

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Expediting Imports and Exports

To reduce costly buffer stock and implement just-in-time inventory man-agement, an organization must ensure that overseas products arrive when they are needed by the organization itself and, more importantly, by its customers. Meeting these demands involves clearing a number of hurdles.

Streamlining Collaboration with Government Authorities

Governments around the world are upgrading and standardizing their IT systems and introducing new, simplified procedures for interaction with busi-nesses. This not only results in tighter export and import controls but also enables expedited customs clearance. To reap the benefits of these new pro-cedures, organizations must be able to provide authorities with complete, accurate information at the right time via the appropriate channels. Increas-ingly, governments are mandating that documentation be filed electronically, pressuring organizations to automate their filing processes.

Mitigating the Financial Risk of International Trade

Whether exporting or importing, enterprises need to be sure business partners meet their contractual obliga-tions. To minimize financial risk, they often use letters of credit to secure international transactions. But manually processing these payment guarantees carries inherent risks. In addition, ensuring that documents contain

precisely the information required is a time-consuming, error-prone chore that makes it difficult to meet dead-lines. By automating the creation and maintenance of letters of credit, enter-prises can improve cash flow and more effectively mitigate risk.

Maximizing the Benefits of Inter-national Trade Agreements

Participating in preferential trade pro-grams such as the North American Free Trade Agreement (NAFTA) and European Union (EU) trade agreements is key to gaining and maintaining a com-petitive edge. However, demonstrating the eligibility of products for reduced or zero tariffs is often an expensive task. Incorrect declarations and insufficient evidence concerning product origin can also bring heavy penalties. To make the most of trade agreements, organi-zations need to automate and stream-line processes from management of supplier documentation to accurate determination of the origin of complex, configurable products.

Leveraging Existing IT Investments

To master the challenges of global trade, enterprises today require a powerful, flexible IT solution built to integrate with the many partners and systems involved in their global trade activities. They demand a solution that can support all global trade processes and enable greater accuracy, efficiency, responsiveness, and cost-effectiveness. The SAP GRC Global Trade Services application fulfills all these requirements and more.

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SAP GRC Global Trade Services allows full control of global trade activities for greater productivity and enhanced operational efficiency. The adaptable application supports all international trade processes, helping enterprises not just survive but thrive in todays highly competitive global marketplace. Figure 1 shows how.

Because SAP GRC Global Trade Services is powered by the SAP NetWeaver technology platform the best way to integrate all systems running SAP or non-SAP software it allows integration of applications, data, and business partner information across the entire global trade process. Eliminating the need for costly inter-faces, it also reduces IT complexity and enables organizations to leverage existing IT investments. In addition, SAP NetWeaver allows organizations to com-pose and enhance business solutions rapidly using enterprise services.

SAP GRC Global Trade Services provides a single, central solution for global trade requirements. Unicode- enabled, it is designed for deployment

ONE CENTRAL SOLUTION

PROVIDING COMPREHENSIVE SUPPORT FOR GLOBAL TRADE ACTIVITIES

Figure 1: The SAP GRC Global Trade Services Application, Powered by the SAP NetWeaver Technology Platform

Integrate Appli-cations, Data, and BusinessPartners

IncreasedProductivity andBusiness Insight

Adaptable BusinessProcesses Based on a Flexible TechnologyPlatform

Logistics andTrade Team

Import and Export Officer

ITTeam

Financial/Legal Compliance

Team

Business Process Integration

SAP NetWeaver

Application Integration Data Integration Business Partner Integration

SAP GRC Global Trade Services

ExportManagement

ImportManagement

Trade PreferenceManagement

RestitutionManagement

around the world. The application, avail-able in 23 languages, enables efficient management of exports and imports as well as preferential trade agreements and specific export subsidies.

Streamlined Processes, Regulatory Compliance

Whether a company imports or exports goods, SAP GRC Global Trade Services helps it take charge of all processes associated with global trade. The result is expedited customs clearance for inbound and outbound shipments, lower financial risk, and less likelihood of stiff penalties for noncompliance. The application also ensures imports and exports are in line with relevant regulations.

ERP Tariff and Numbering Schema Cus tomer, Supplier

SCM, SRM Duty Rates Banks

CRM SPL Data Freight Forwarder

Legacy Software Rules of Origin Customs Agencies

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SAP GRC Global Trade Services provides the proactive regulatory compliance functions needed for screening personnel, monitoring ship-ments, and managing licenses. It also helps streamline customs processes to clear products through customs faster.

Trade Compliance Functions

The proactive compliance functions enabled by the application include: Screening Business partners and documents

are automatically screened against official sanctioned party lists (SPLs), eliminating time-consuming, error-prone manual checks. Lists from external data providers can be auto-matically uploaded to the software, helping ensure the database is complete and accurate at all times. In addition, comprehensive audit trails enable enterprises to provide the authorities with full details of all compliance checks.

Embargo checks Inbound and outbound shipments

are monitored to determine whether there are restrictions on the country or countries involved. If the software identifies a problem, it automatically blocks the relevant documents and logs the reasons enforcing ironclad compliance.

Export and import license management

Compliance with export and import controls is streamlined in SAP GRC Global Trade Services. The applica-tion identifies whether licenses are required for a particular transaction, determines the suitability for license exceptions or licenses on file, and

then performs the appropriate assign-ment. In addition, integrated monitor-ing functions help track remaining quantities, values, and validity periods.

Customs Processes

Rapid customs clearance is essential to ensuring that incoming and outgoing shipments arrive on schedule. SAP GRC Global Trade Services supports import- and export-related customs processes, saving valuable time and helping eliminate avoidable delays at borders by enabling the following processes: Product classification Assigning official material numbers

to goods for import or export can be complex, laborious, and unreliable. But failing to pinpoint the optimum classification can be costly increas-

ing duties and taxes unnecessarily. With SAP GRC Global Trade Ser-vices, this key task can be handled in-house, speeding up the process and eliminating expensive, third-party brokers. Classification data can be automatically uploaded from autho-rized providers.

Customs valuation and duty calculation

SAP GRC Global Trade Services pro-vides a flexible and powerful customs valuation engine that supports accu-rate and compliant determination of customs value, satisfying local cus-toms regulations across the globe. The software reduces the risk of val-uation errors by identifying statutory adjustments to transaction value. It also takes the strain out of calculat-ing a wide range of duties, taxes, and fees, including ad valorem, com-plex, compound, antidumping, and

PROACTIVE COMPLIANCE,

FASTER CUSTOMS CLEARANCE

LEVERAGING IMPROVED AUTOMATION, COMMUNICATION

I am pleased to say that 100% of our orders and

deliveries are screened for compliance with the

U.S. BIS denied party lists using the SAP [GRC]

Global Trade Service solution. This would have

been unattainable without the SAP solution, which

automates the process completely and removes

any manual effort or risks of noncompliance on

our part.

Mark Yee, Manager, Global Export Compliance, Applied Biosystems

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preferential duties. This ensures timely and accurate transfer of funds to the authorities, which helps enter-prises build a solid reputation for compliance and efficient customs clearance.

Electronic communications with government authorities

SAP GRC Global Trade Services provides certified interfaces with cus-toms authorities via various platforms including the Automated Commercial Environment in the United States and the Integrated Cargo System in Aus-tralia. The software also supports communications within the scope of the eCustoms initiative in Europe, including the New Computerized Transit System and the Automated Export System.

Paper-based documentation Although digital communications is

rapidly gaining ground, paperwork

still remains a fact of life. From entry summaries to certificates of origin to packing lists, enterprises can quickly and easily determine and create the right documentation for specific transactions via SAP GRC Global Trade Services. Moreover, all the ap-propriate documents can be printed out easily to coincide with shipment dates and other deadlines. With the help of Adobe technology, the SAP software also makes it simple to create and modify forms as required.

Handling of customs procedures with economic impact

Complex tasks associated with customs warehousing and inward processing can now be managed more efficiently. The SAP software automates tracking of the status of goods in inventory (duty paid or duty unpaid), helping minimize and defer payment of import duties.

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SAP GRC Global Trade Services efficiently mitigates the financial risk of international transactions. For example, the application automatically identifies export orders requiring letters of credit. If none is available, the transaction is automatically blocked. The software also ensures that the documents de-manded by the issuing bank contain the right information, helping avoid delayed payments. Importers can open letters of credit with their bank, specifying the paperwork that suppliers must provide.

Preferential Trade Agreements

In addition to these payment guaran-tees, the software helps organizations tap into the opportunities available through trade agreements such as NAFTA and those of the European Union. For example, suppliers decla-rations of origin can be managed more efficiently via portal-based self-services. Complex official rules of origin can be automatically uploaded from third-party providers and easily printed out. Even highly complex, con-figurable products can be managed this way. Comprehensive audit trails ensure authorities know exactly how particular results are achieved.

Restitution Management

Common Agricultural Policy export subsidies are vital to the competi-tiveness of EU companies in price-sensitive global markets. However, the complexity of export funds proce-dures (also known as restitution) can be daunting. SAP GRC Global Trade Services automates and streamlines all aspects of restitution handling,

enabling greater visibility and more efficient refund processing while mini-mizing the risk of forfeiting securities.

Expert Support Worldwide

Deploying the global trade application enables enterprises to reap the bene-fits of powerful, state-of-the-art soft-ware while enjoying the support of SAPs worldwide partner ecosystem, composed of trusted data providers and system integrators as well as technology partners and global trade experts. That means organizations get the very best from their software installation anywhere in the world.

RISK MITIGATION

AND NEW FINANCIAL OPPORTUNITIES

Implementing [SAP GRC] Global Trade Services for

us and our many different divisions was a quantum

leap in both compliance and consistency.

Paul Wilde, Group Program Manager, Microsoft

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TRADING ON A GLOBAL BASIS

THE BENEFITS OF IMPLEMENTING SAP GRC GLOBAL TRADE SERVICES

The global trade application provides benefits in several areas, enabling organizations to: Reduce the risk of regulatory

noncompliance Check proactively to ensure there

are no restrictions on specific people, countries, or products involved in transactions

Standardize compliance processes throughout the organization

Reduce the risk of costly fines and penalties

Maintain a complete and accurate audit trail

Implement effective internal con-trols for cross-border transactions and other international require ments

Accelerate cross-border transactions Reduce cycle times through expe-

dited customs clearance of inbound shipments

Ensure faster delivery to customers by minimizing delays at national borders

Automate and standardize process-es that help increase productivity

Enhance process efficiency through seamless integration with logistics processes

Lower total cost of ownership (TCO) Implement one central global trade

solution instead of multiple, stand-alone applications, reducing soft-ware and hardware investments

Deploy a single, open technology platform that delivers tight integration with SAP and non-SAP software and eliminates costly interfaces

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SAP GRC Global Trade Services delivers end-to-end support for inter-national trade processes and provides tools to help organizations understand how these processes work. One of these tools is the solution map shown in Figure 2. This multilevel process blueprint is built on input from cus-tomers and industry analysts as well as on mastery gained through SAPs years of hands-on experience and research.

The map helps organizations visualize, plan, and implement a coherent, inte-grated, and comprehensive IT solution. It also shows how various processes are covered, including the processes that SAP and its partners support. Using the solution map, managers can rapidly understand solutions and their potential business value. The solution map for SAP GRC Global Trade Ser vices can be downloaded from http://www.sap.com/businessmaps/B3C7A0E34CB3410EA2FD135EA988C8F6.htm.

SUPPORT KEY BUSINESS PROCESSES

FOLLOW THE SOLUTION MAP

SA

P N

etW

eave

r

ExportManagement

ImportManagement

Trade PreferenceManagement

RestitutionManagement

ExportClassification

ExportCompliance

Outbound CustomsServices

Outbound Trade FinanceServices

ImportClassification

ImportCompliance

Inbound CustomsServices

Inbound Trade FinanceServices

Vendor Declaration Handling Preference Determination Customer Declaration Handling

Securities and Licenses Handling Restitution Recipes Handling Restitution Calculation

Figure 2: Map for the SAP GRC Global Trade Services Application

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http://www.sap.com/businessmaps/B3C7A0E34CB3410EA2FD135EA988C8F6.htm

As the solution map shows, SAP GRC Global Trade Services is built on the strengths of SAP NetWeaver and pro-vides all the functionality needed to manage global business successfully. It covers: Export and import

Classify products on the basis of official schema such as the Harmo-nized Tariff System, the Export Con-trol Classification Number, or the Schedule B Harmonized Tariff Number

Ensure regulatory compliance through SPL screening, embargo checks, and effective export and import license management

Calculate duties accurately Create, change, and print all neces -

sary export and import documen -tation efficiently, including a shippers export declaration, a single ad -mi nistrative document, and entry summaries (using Adobe technology)

Handle customs warehousing procedures and track inventory status (duty paid or unpaid)

Streamline electronic communi-cations with customs authorities via a variety of official platforms

Manage letters of credit and all related documentation effectively

Trade preference Maintain and request vendor

declarations in a variety of formats (paper- and Web-based, automatic electronic exchange)

Determine eligibility of products for preferential treatment includ-ing calculations of origin across multiple plants and for complex, configurable products

Issue certificate of origin to customers

Restitution Handle export licenses, securities,

and restitution recipes Calculate restitution amount on

the basis of official rules Gain quick and easy insight into

a wide range of restitution-related activities through a user-friendly cockpit

GETTING THE MOST FROM IT INVESTMENTS

DONT LOSE THAT MAP

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The application integrates and stream-lines import and export processes throughout the extended enterprise. By delivering complete, accurate, and up-to-the-minute business intelligence across all global trade activities, it

enables more informed decision making. And it provides complete optimization by making it easy to select the best places to source materials, to locate new manufacturing plants, and to establish distribution centers.

CHOOSE SAP GRC GLOBAL TRADE SERVICES

OPERATE, ANALYZE, OPTIMIZE

Sharpen the Competitive Edge Identify Opportunities and Move Quickly

Activity Benefi t

Export and Import Management Accelerate outbound deliveries through automated trade compliance for greater

customer satisfaction and improved cash flow

Reduce buffer stock by making import processes more predictable

Enhance process efficiency through tight integration with other inbound and outbound

processes

Avoid costly fines and penalties; help ensure tighter national security

Minimize import duties through optimized product classification

Reduce or defer payment of import duties by managing customs warehouses

Ensure correct payment to authorities through accurate tariff calculation

Meet complex documentation requirements through use of integrated, customizable forms

Streamline electronic communications with customs authorities

Mitigate financial risk of global trade through automated handling of payment guarantees

Make better sourcing decisions by determining the scenarios with the lowest import duties

Be prepared for audits by maintaining complete and accurate documentation of all

export- and import-related activities

Trade Preference Management Benefits Maximize the opportunities offered by trade preference agreements

Save time and increase efficiency through supplier self-service, automation, and

streamlined processes

Be prepared for audits by maintaining complete and accurate documentation of all

preference-related activities

Restitution Management Benefits Enhance competitiveness by taking advantage of export refunds

Ensure compliance with all requirements for restitution, from initial application through

receipt of payments

Be prepared for audits by maintaining complete and accurate documentation of all

restitution-related activities

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3Com, United States ABB, Germany Adaptec, United States AES Gener SA, Chile Airbus, Germany Air Products and Chemicals Inc.,

United States arvato services, Germany ASML, Netherlands Bayer, Germany Cognis, Germany Degussa, Germany Dow Corning Corporation,

United States Eli Lilly and Company,

United States Entegris, United States Ericsson, Sweden FAG Kugelfischer, Germany General Mills Services, Inc.,

United States

Heckler & Koch, Germany HP, United States KLA Tencor, United States Medtronic, United States Merckle, Germany Microsoft Corporation,

United States NVIDIA, United States Rohm and Haas, United States Schott AG, Germany Sigma-Aldrich, Germany StorageTech, United States Symbol Technologies,

United States The Coleman Company,

United States Teekanne, Germany Valio Oy, Finland West Pharmaceutical Services,

United States

Partial List of Global CustomersA large number of customers in a wide variety of industries including some of the worlds best-known brands are already reaping the benefits of SAP GRC Global Trade Services. With this state-of-the-art application, enterprises gain a wealth of advantages whatever the size of their business. These benefits include scalable, one-stop centralized support for all global trade activities; tight integration with hetero-geneous systems; and enhanced insight into all aspects of the international operations. Whats more, through the enterprise service-oriented architecture supported by SAP NetWeaver, organi-zations can deploy specialized business processes that operate seamlessly with existing systems and software.

To find out more about how SAP GRC Global Trade Services can help stream-line exports and imports and help your organization get ahead in global markets, visit www.sap.com/gts or send us an e-mail via www.sap.com/solutions/grc/globaltradeservices/index.epx.

PAVE THE WAY FOR SUCCESS

LAY A SOLID FOUNDATION FOR GLOBAL GROWTH

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www.sap.com/solutions/grc/globaltradeservices/index.epx

Join Americas SAP Users Group (ASUG),

the largest and most established community

of global trade peers.

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www.sap.com/contactsap

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