License Screening Process Steps

In terms of process, the following are the major steps for those transactions that require licenses:

Create Trade Transactions and Trade Transaction Lines
Look Up Product Classification
Execute Compliance Rules
Depending on the results, there will be two options to release the Hold:
1. Review and Release the Hold manually
2. Perform Assign License
Perform Reevaluate License
Perform Unassign License
Show License Line Usage History
Adjust Balance

Create Trade Transactions and Trade Transaction Lines

Transactions are examined for import or export controls. A trade transaction/trade transaction line holds important information such as port, type of transaction, involved party, remark, etc. that will be used at the time of assigning the licenses. Examples of Trade Transactions are:

Navigate to Trade Compliance Management > Trade Transaction Management > Trade Transaction.

Transaction #1 representing the sales order:
- Enter a Transaction ID = SALES ORDER456.
- Enter a Transaction Type ID = SALES ORDER.
- In the Dates section:
  - Select a Date Qualifier ID = ORDER DATE with a Date = 2017-05-12.
- In the Involved Parties section:
  - Select an Involved Party Qualifier ID = BUYER with an Involved Party = MINISTRY OF EDUCATION INDIA.
  - Select an Involved Party Qualifier ID = END USER with an Involved Party = NEW DELHI UNIVERSITY.
  - Select an Involved Party Qualifier ID = SELLER with an Involved Party = VISION USA INC.
  - Select an Involved Party Qualifier ID = SHIP_TO with an Involved Party = NEW DELHI UNIVERSITY.
- Click Transaction Line and click New Transaction Line:
  - Enter a Transaction Line ID = SALES ORDER456-0001.
  - Select an Item ID = DIGITAL COMPUTER.
  - In the Quantity section:
    - Select a Quantity Qualifier ID = ORDERED_QUANTITY with a Quantity = 1 and a UOM of EA.
  - In the Value section:
    - Select a Value Qualifier ID = TOTAL VALUE with a Value = 10 USD and a Method of Calculation = ENTERED MANUALLY.
  - In the Remark section:
    - Select a Value Qualifier ID = FIRST CUSTOMER ORDER with a value = YES.

Transaction #2 representing the fulfillment line:
- Enter a Transaction ID = FULFILLMENT456.
- Enter a Transaction Type ID = FULFILLMENT LINE.
- In the Dates section:
  - Select a Date Qualifier ID = ORDER DATE with a Date = 2017-05-15.
- In the Involved Parties section:
  - Select an Involved Party Qualifier ID = BUYER with an Involved Party = MINISTRY OF EDUCATION INDIA.
  - Select an Involved Party Qualifier ID = END USER with an Involved Party = NEW DELHI UNIVERSITY.
  - Select an Involved Party Qualifier ID = SELLER with an Involved Party = VISION USA INC.
  - Select an Involved Party Qualifier ID = SHIP_TO with an Involved Party = NEW DELHI UNIVERSITY.
- Click Transaction Line and click New Transaction Line:
  - Enter a Transaction Line ID = FULFILLMENT789-0001.
  - Enter an Item ID = DIGITAL COMPUTER.
  - In the Quantity section:
    - Select a Quantity Qualifier ID = ORDERED_QUANTITY with a Quantity = 1 and a UOM of EA.
  - In the Value section:
    - Select a Value Qualifier ID = TOTAL VALUE with a Value = 10 USD and a Method of Calculation = ENTERED MANUALLY.

Look Up Product Classification

When you execute the Look Up Product Classification action, GTM looks at the classification on the item and copies the classification data from the item to the sales order line. In this example, this action copies the ECCN US = 3A991.a.1 from the item to the sales order line.

Refer to the GTM Product Classification Overview topic for more detail on how to classify items.

Execute Compliance Rules

The Execute Compliance Rules action flag those transactions that require a license or authorization and place them on hold. Compliance rules can be executed using a compliance rule set group or a policy. In this example:

Execute compliance rules for the Transaction ID = SALES ORDER456 with the compliance rule set group=EAR-RULE-SET-GROUP-1. GTM will execute the LICENSE rules first and then the LICENSE_EXCEPTION rules for each Rule Set in the Rule Set Group. In this scenario, LICENSE Rules EAR-1 and EAR-2 are executed first and then the LICENSE_EXCEPTION RULE. Only rule ID = EAR-1 applies to the transaction line and it goes on hold. GTM will include the rule and the corresponding control under the Control Screening Results grid in the Transaction Line.
Execute compliance rules for the Transaction ID = SALES ORDER456 with the compliance rule set group=EAR-RULE-SET-GROUP-2. The Control Screening results indicate that a control type = EAR-CONTROL, control code = DUE DILIGENCE, and compliance rule ID = EAR-4 have been assigned to the transaction line and the line has been placed on hold.

Review and Release the Hold Manually

Once the due diligence process has been performed by the company and it is decided that the company can move forward with the transaction, you go to the Control Screening Results section of the Transaction Line tab and look for the line with the Control Type = EAR and Control Code = DUE DILIGENCE and edit it as follows:

Enter Authorization = PASSED DUE DILIGENCE
Click Save

This manual action will release or override the control from the compliance rule. Make sure you click Finished to save any changes to the record you are editing.

Perform Assign License

The Assign License action assigns licenses to transactions lines that are on hold in two possible ways: license reservation or actual assignment. GTM assigns as many licenses as required to cover the quantity and/or values required on the transaction. If there is not enough quantity and/or value on the eligible licenses, GTM does not assign a license and the transaction will continue to be on hold. In the above sales order screening example, GTM assigns the license EARLICENSE444 as the license matches the data elements in the transaction identified in the constraint set and has enough quantity and value. The license has a balance type of “reserve” which means that GTM will reserve the balance against the sales order, but it is not a firm assignment against the license balance.

Later in the process, you can execute the compliance rules action on the fulfillment line. In this case, GTM checks the license quantity and value reserved on the preceding transaction line. If the preceding transaction line is specified on the fulfillment line, GTM will use this to determine which sales order line is the preceding line for the fulfillment line. To set up additional details to be used during matching, the transaction line saved query defined on the license code can be used.

The license quantity and value used in the previous transaction line, the SALES ORDER456-0001, will be carried over to the current transaction line, FULFILLMENT789-0001, and will be reduced from the SALES ORDER456-0001. The license balance usage history will be updated accordingly. In this example, GTM will take 1 unit and the corresponding value from the license reserved to the sales order and move this quantity and value to the fulfillment line.

Reservation of licenses is recommended when you want to reserve the license balance early in the process so you know that there is enough available of the license to apply. Assignment of licenses will commit the license balance to the transaction. For example, reservation of licenses could be used for sales order or fulfillment lines, and assignment of licenses could happen for shipment-related transactions such as Advanced Shipment Notice (ASN), delivery, or actual shipment. Once the transaction line moves from reservation to actual assignment status, it cannot be reversed. There is an assumption that once it is assigned then it has to be reported to the government as such. In-case the actual assignment is performed at the sales order line level, you do not need to re-assign the license at the delivery level. In this situation it is better to copy license information from the sales order line to the matching delivery line via the Copy Data From Transactions or Copy Data From Transaction Lines actions and agent actions. When you copy information from transaction to transaction and you select controls, GTM will copy the license information as well.

As an alternative to the automatic assignment, you can use the Assign License Show Options action on a trade transaction or transaction line. When you perform this action, the matching licenses are displayed and you can select the licenses manually.

Note: License assignment actions are only supported on trade transactions. These actions are not supported on declarations.

Perform Reevaluate License

You can use the Reevaluate License action on a trade transaction or transaction line to check whether the license is still valid downstream in the fulfillment process. For example, if a license was assigned in the month of February to the sales order and the shipment takes place in October, you may want to check whether the license is still valid. In case the transaction quantities or values are changed, the re-evaluation can be used to make additional reservations or assignments.

Perform Unassign License

You can use the Unassign License action on a trade transaction or transaction line to remove the license from the transaction and update the balances accordingly.

Show License Line Usage History

View license balances on a transaction line level on the License Line Usage History page within License Management.

Adjust Balance

To manually adjust the balance, use the Adjust Balance action on a license. This allows you to make adjustments to the license balances manually.