Trade Compliance

Every country has laws about importing and exporting goods and technology. International organizations such as the United Nations and the European Union also regulate trade by member states. Foreign affiliates and joint ventures are responsible for complying with any export and/or import restrictions imposed by the laws of the countries in which they are located as well as applicable United States laws.

Baxter and its agents and representatives must comply with all applicable import and export controls. All business units must appoint both Import Compliance Officers (ICO) and Export Compliance Officers (ECO). The ICO and ECO work with Baxter's International Trade and Customs (ITC) group in Deerfield to oversee the company's trade compliance program and provide guidance on trade compliance issues. These include:

Denied Parties
Baxter is prohibited from doing business with certain individuals, groups, or organizations in both domestic and export markets. The ECO and ITC maintain lists of these "denied parties." Consult with them to be sure Baxter does not do business with a "denied party."

Prohibited Activities
Baxter personnel must screen transactions with potential "end-user" customers who may be involved in chemical or biological weapons development, missile technology or sensitive nuclear activities. The ECO and ITC can help with the screening.

"Red Flags" and Warning Signs
Baxter employees must note any unusual circumstances in a transaction that may indicate the product, technology, or technical data may be destined for an inappropriate end use, end-user, or destination. Contact your ECO or ITC when any "red flags" appear in a transaction.

Restricted Products and Technologies
Certain products, software and technologies require an export license even when they are shipped to a legitimate company in a friendly country for peaceful use. Contact ITC for information about license requirements for export or re-export of these materials.

Trade Restricted Countries
The United Nations and the United States government restrict trade with certain countries. Baxter's Executive Management Team has adopted a policy regarding transactions or relationships with these trade restricted countries. Contact your ECO or ITC for a copy of this policy.

U.S. Antiboycott Regulations
A boycott is an organized effort to coerce its "target" to take a specific action. Boycotts are "enforced" by refusing to buy, sell or use the target's products and/or services. Because of a boycott against Israel by certain Arab and Islamic countries, Baxter and its affiliates must be especially sensitive to compliance with the U.S. antiboycott regulations. All Baxter operations and employees worldwide must strictly adhere to U.S. antiboycott laws. Contact ITC or legal counsel in Deerfield with questions regarding boycotts.

Classification of Goods
Countries assess and collect import duties on goods that cross their borders. In order to determine the appropriate duty owed, imported goods must be classified accurately and assigned the correct tariff number. The description, use and contents of the imported material determine the tariff classification. Direct questions about the classification of goods to ITC.

Country of Origin
Country of origin or country of manufacture is determined by where the goods were "substantially transformed." Simple assembly of components does not establish country of origin. Contact ITC with questions about country of origin.

Valuation
Intercompany shipments to Baxter affiliates must show a "value for customs purposes" as the established intercompany transaction price. Shipments from third parties must show a cost that reflects the "fair market value" of the goods being imported. Undervaluing goods on commercial documents in an attempt to pay less duty is prohibited. Any post-entry charges (e.g. volume discounts, rebates, currency risk sharing, assists, royalties) must be communicated to the appropriate import function to ensure compliance with import regulations.