SAP BusinessObjects Global Trade Services (GTS)

SAP Global Trade Services (GTS) enables enterprises to automate and streamline complex
import and export processes - to ensure full regulatory compliance, expedite customs
clearance, take full advantage of international trade agreements, and mitigate the financial
risk of global transactions.
Compliance Management
Customs Management
Risk Management in Global Trade Services
Electronic Compliance Reporting
Risk Management in Global Trade Services

Global Trade Services (GTS) contains application areas for risk management, which let you minimize the financial
risk associated with your global trade activities. You can integrate these application areas with your standard
processes for managing foreign trade transactions. The following services are available:
Preference Processing
Letter of Credit Processing
Restitution
Letter of Credit Processing
You can use Letter of Credit (LOC) Processing in Global Trade Services (GTS) to mitigate the financial risks
involved in global trade. You can integrate this application with your import and export transactions, minimizing
risk in your international trade activities while speeding up process flows at the same time. You can monitor
delivery deadlines and document receipts better for legal control purposes. You can use the following functions to
minimize the risks of your import and export transactions:
You can maintain letters of credit, which you receive from banks, in the letter of credit master. You can use the
following LOC types:
o Revocable
o Irrevocable, unconfirmed
o Irrevocable, confirmed
You can enter all relevant delivery and document data in the header data of the letter of credit. You can also
enter internal and external LOC numbers, Incoterms, company codes, addresses, and administrative data. The
item data includes status data, business partner data, values, and bank data.
Integrated inbound and outbound logistics lets you assign letters of credit to import and export documents.
The system detects whether your import or export business partner is relevant for Letter of Credit Processing,
which means you have to assign a letter of credit to that business partner.
You can enter bank master data by transferring the initial data from your feeder system to the GTS system and
then enrich it in business partner maintenance.
You can monitor the status of your letters of credit with the following display options:
o Existing letters of credit
o Assigned letters of credit
o Blocked documents
Two different users must carry out the review of the letter of credit and its subsequent activation.
You can print documents in accordance with the regulations for a letter of credit.
Prerequisites
For more information about the Customizing settings for Letter of Credit Processing, see the Configuration Guide
for Letter of Credit Processing at SAP Service Marketplace under the following path:
http://service.sap.com/swdc SAP Software Download SAP Software Download Center SAP Installations and
Upgrades Installation and Upgrade Guides - Entry by Application Group Analytics Governance, Risk,
Compliance Global Trade Services
Process
Imports with Letters of Credit
This scenario describes the process of importing goods to your country using a letter of credit.
1. As an importer, you request a quotation from an exporter for goods that you want to purchase. The quotation
could include shipping and insurance costs.
2. After you receive a quotation from the exporter, you create a purchase order based on that quotation.
3. The exporter creates a pro forma invoice and sends it to you.
4. You open a letter of credit at the opening bank in the country of destination (import country). During this
transaction, you have to notify the opening bank which documents they need from the exporter. As an importer,
you not only need the documents required for customs, but also the documents that other service providers need
to handle your goods traffic, such as:
Bill of lading
Commercial invoice
Export packing list
Single Administrative Document (EU only)
Shippers Export Declaration (U.S. only)
Certificate of origin
Insurance certificates
Licenses (if needed)
5. You create a letter of credit in the GTS system. An import documentary credit gives your vendors a guarantee
from your house bank that payment will be rendered within a defined period when the documents listed in the
letter of credit are provided. For you as importer, using a letter of credit reduces the risk of having to pay for
goods in advance or having to pay for goods or services that do not match the product descriptions in the letter of
credit.
6. If you use a letter of credit, the vendor dies not have to demand advance payment to safeguard the delivery; in
addition, because the letter of credit guarantees the transaction, your vendor will often offer a better price.
7. The opening bank sends the letter of credit to the advising bank in the exporter's country.
8. The advising bank notifies the exporter that a letter of credit has been opened in his favor.
9. The exporter dispatches the goods in accordance with the conditions defined in the letter of credit.
10. The exporter provides the appropriate documents to the advising bank to document that the goods were
dispatched in agreement with the letter of credit conditions.
11. The advising bank pays the exporter based on the received documents.
12. The advising bank sends the documents to the opening bank and receives payment.
13. The opening bank provides you (the importer) with the documents.
14. You calculate the import duty rates, submit the customs declaration within the legally defined period, and pay
the customs duties.
Note
You calculate the customs import duties and create a customs declaration in Customs Management.
Export with Letter of Credit
This scenario describes the transaction for exporting goods and receiving payment using a letter of credit.

1. The importer sends you a purchase order based on your quotation.
2. You create a sales order based on the purchase order and send it to the importer, together with the invoice.
Optional: You notify the importer of the exact delivery date and delivery quantity of the goods in an inbound
delivery.
3. The importer opens a letter of credit at the opening bank in the country of destination (import country).
This letter of credit defines which documents are required by the customs authorities and other parties involved
in handling your goods traffic, for example:
Bill of lading
Commercial invoice
Export packing list
Shippers Export Declaration (U.S. only)
Single Administrative Document (EU only)
Certificate of origin
Insurance certificates
You can create and print all the above documents for customs processing, aside from the insurance
certificates. The export documentary credit guarantees that payment will be made as long as you deliver the
goods within the defined time frame and submit the documents defined in the letter of credit. This helps you,
the exporter, reduce payment risk. You can also demand immediate payment within the framework of the
LOC conditions (assuming the documents are correct), improving your cash flow.
4. The opening bank sends the letter of credit to the advising bank in your country.
5. The advising bank notifies you that a letter of credit has been opened in your favor.
6. You dispatch the goods in accordance with the conditions defined in the letter of credit.
7. You provide the advising bank in your country with the appropriate documents to document that the goods were
dispatched in agreement with the letter of credit conditions.
8. The advising bank pays you for the goods, based on the received documents.
9. The advising bank sends the documents to the opening bank.
10. The advising bank receives payment from the customer.
11. The importer receives the goods, submits a customs import declaration, and pays the customs duties to the
responsible authorities.
12. You submit a customs declaration for the exported goods.

Compliance Management

Compliance Management helps ensure your compliance with international trade regulations in three main areas:
Sanctioned party list screening
Legal control - export (including embargo checking and license management)
Legal control - import (including embargo checking and license management)
Compliance Management helps you rationalize your extended logistics chain and automate the complicated
processes that are involved with international trade compliance issues, a primary prerequisite for successful
international trading activities. This minimizes the risk of penalties and fines, maximizes your companies return on
global sourcing and selling initiatives, and increases your overall competitiveness by improving customer
satisfaction.
Note
To ensure end-to-end documentation of transactions for your own purposes and official controls, you canarchive
objects from Compliance Management, at the same time reducing the demands on your technical system
infrastructure.
Prerequisites
You have configured Compliance Management based on the descriptions in the Configuration Guide for
Compliance Management. The Configuration Guide is available at the SAP Service Marketplace
underservice.sap.com/swdc Download Installation and Upgrades Entry by Application Group SAP
Application Components SAP Global Trade Services (GTS) SAP GTS <Release> Installation and Upgrade .
Process
Sanctioned party list screening

1. You create a sales document or document for materials management in the feeder system.
2. The system for compliance checks in Global Trade Services (GTS) starts sanctioned party list screening
automatically. Based on the rules that you configured during implementation, the address data in the business
documents is checked against the available sanctioned party lists in the GTS system. You can obtain these lists
in XML format from external data providers and upload them to your GTS system. You can also create your
own lists.
3. The monitoring features in the GTS system let you easily keep track of all checked addresses.
4. An employee with the appropriate authorizations can use the monitoring capabilities to release blocked
documents for further processing.
5. Periodic checks can be set up to check the current available master data. You can configure the sequence that is
used for checking the master data. It makes sense to set up the system so that all the master data is checked
automatically after every update of the sanctioned party lists.
6. All activities are logged in the area of sanctioned party list screening and can be archived for legal purposes with
the SPL audit trail function.
Export/import control and embargo check

1. You create or change business document in the feeder system.
2. The GTS system starts the export/import control automatically. It checks whether an import or export license is
required to import or export the product, based on the settings configured in Customizing for the GTS system.
3. If a license is required, the system assigns the appropriate license automatically to the business transaction.
Note
If the applicable combination of export control classification number and country of destination is not permitted,
the business transaction is blocked automatically.
Import and export controls are based on a combination of the following parameters:
Export control classification number
Country of destination
Country groups
Single products
Special customers
Quantities
Values
The license itself contains information about the allowed imports and exports, particularly quantities and/or
values. When the business document is posted in the feeder system, the GTS system updates the values and/or
quantities in the license.
4. In addition, the GTS system performs an embargo check for the specific business transaction. The check is based
on the combination of the country of departure and the country of destination (or groups of countries). If the
system detects an embargo situation, the document is blocked for further processing.
Monitoring
You can use the reporting functions in the GTS system to monitor all transactions throughout your process chain, for
example, by selecting blocked documents or displaying assigned licenses. You have an overview of the entire
process and full control over the individual transactions, and can ensure absolute transparency.

Electronic Compliance Reporting

The single internal market of the European Union (EU) reduces the flows of goods that are tracked by the customs
authorities to imports and exports with countries outside of the EU. Recording the country-specific, intra-European
flows of goods between the individual member states of the European Union is just as important, however, to enable
statements about a country's economic strength, foreign trade activities, and goods movements. This information
enables the states to implement measures to optimize their trade conditions, for example.
As a result, companies are required to record the necessary statistical data as described by the respective member
country's rules. Electronic Compliance Reporting (ECR) in the Global Trade Services (GTS) system supports you in
statistics declarations that you have to submit to the authorities for intra-European trade between two EU member
states. To do so, you have to provide statistics data in the specific data format of your country's statistics authorities,
which can differ within the EU. The relevant data for the Intrastat declarations is based the logistics processes. After
the Intrastat-relevant data is collected from these logistics processes, you can send it to your national statistics
authorities in periodic Intrastat declarations.