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Trade Sanctions Compliance

What is an HS Code and why does it matter?

An HS Code (Harmonized System) is an international standard for classifying goods. Sanctions often apply to specific codes, so correct identification is critical to avoid violations.

Can cargo transit through Russia?

Transit through Russia isn't banned for all goods, but restrictions apply to certain categories (dual-use, high-tech). Specific case analysis is required.

What if I accidentally buy from a sanctioned person?

If sanctions are violated, the bank will block the transaction and account. You may face fines and blacklisting. Prior screening is essential.

Does customs check every cargo?

Customs uses a risk management system. Cargo with suspicious codes or routes undergoes detailed inspection, which can last for weeks.

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Trade Sanctions Compliance is a critically important legal area for Georgian companies engaged in international trade. Given the global geopolitical situation, Georgia, as a transit hub, faces a high risk of becoming a channel for sanctions evasion. International sanctions (US, EU, UK) prohibit the export, import, or transit of certain categories of goods regarding specific countries (e.g., Russia, Iran, Belarus) or individuals. Violating sanctions leads to severe consequences: freezing of bank accounts, destruction of reputation, and blacklisting of the company. Legal.ge offers expert services to ensure your trade operations fully comply with international restrictions and to prevent inadvertent legal violations.

What does this service cover?

Our service covers the full cycle of trade sanctions risk management:

  • Product Classification (HS Codes): Analyzing commodity codes and comparing them with lists of sanctioned products (e.g., luxury goods, dual-use items).
  • Partner Screening: Checking buyers, sellers, and logistics companies against international sanctions databases (SDN List, Consolidated List).
  • Certificate of Origin Analysis: Determining the country of origin to rule out imports from sanctioned regions.
  • Transit Route Assessment: Analyzing risks if the cargo passes through sanctioned territory.
  • Customs Consulting: Assisting in completing customs declarations to avoid cargo detention based on suspicion.
  • Internal Control System Implementation: Creating sanctions monitoring procedures within the company.

Common Scenarios and Needs

This service is essential for:

  • Logistics Companies: Operating shipments in the region.
  • Exporters: Wishing to sell their products risk-free.
  • Tech Distributors: Importers of electronics and chips.
  • Banks: When financing trade operations (Trade Finance).

Georgian Legal Framework

Georgia strictly adheres to international sanctions. The Law on Facilitating the Prevention of Money Laundering and Terrorism Financing and Orders of the Minister of Finance regarding restrictions on the movement of sanctioned cargo apply. The Revenue Service implements strict customs control over sanctioned products.

Step-by-Step Process

The process begins with a preliminary analysis of the transaction. The lawyer checks the commodity code and the counterparty. If the risk is high, enhanced due diligence is conducted. An opinion on the safety of the transaction is prepared. If necessary, consultation with the Revenue Service takes place. After the transaction, documentation is archived for audit purposes.

Why Legal.ge?

Sanctions violations do not excuse ignorance. Legal.ge connects you with lawyers who possess up-to-date information on changing sanctions regimes and use professional screening tools. With our help, your business will be secure and compliant.

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