Manage Global Trade Restitution Laws and Demands Using SAP BusinessObjects Global Trade Services 8.0

  • by Ravi Kalluri, SAP BusinessObjects Global Trade Services Consultant, Accenture Services Pvt. Ltd.
  • October 13, 2011
Learn how SAP BusinessObjects Global Trade Services handles the restitution process in the European Union. Understand how to configure restitution functionality in SAP BusinessObjects Global Trade Services 8.0 through a step-by-step configuration checklist.
Key Concept
SAP BusinessObjects Global Trade Services allows you to export agricultural products from the European Union (EU) to non-EU countries by assigning a restitution license to the sales and distribution (SD) sales document. Restitution functionality is a part of the Risk Management module in SAP BusinessObjects Global Trade Services.

If your company is based in the European Union (EU) and exports food or agricultural products to non-EU countries, you have to follow the legal rules and regulations of the Common Agricultural Policy (CAP). These rules are only for EU-based companies. To benefit exporters, CAP provides subsidies or restitution and reimburses exporters for the difference between the price of the products in Europe and on the global market.

Dealing with a huge amount of data from multiple sources for carrying out global trade is daunting. You must comply with the required documentation and adhere to the legal rules and regulations. Moreover, if you do not satisfy these required conditions, then you not only risk missing out on the subsidies but also stand to forfeit some collateral, or in business terms, a security you have put up against a refund that is being expected.

Note
Every EU-based company exporting restitution-relevant products to non-EU countries as part of the restitution law needs to put a security amount with the customs officials at the start of the trade activities. If your company does not comply with the legal rules of CAP or does not submit correct documentation, then the security amount is forfeited.

The CAP includes the following objectives:

  • To increase agricultural productivity by promoting technical progress and by ensuring the rational development of agricultural production and the optimum use of the factors of production, in particular labor
  • To ensure a fair standard of living for the agricultural community, in particular by increasing the individual earnings of persons engaged in agriculture
  • To stabilize markets
  • To assure the availability of supplies
  • To ensure that supplies reach consumers at reasonable prices

Ravi Kalluri

Ravi Kalluri is an SAP BusinessObjects Global Trade Services consultant at Accenture Services Pvt Ltd. His focus is on the entire global trade area, including Compliance Management, Customs Management, Risk Management, and Electronic Compliance Reporting. He has an excellent understanding of SAP ERP logistics processes and their integration to global trade in a supply chain environment. His interests are networking, participating in conferences, and writing articles.

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