On Wednesday, January 23rd, PKF Texas and Regions Bank hosted an International Business Forum. During the Forum moderated by Russ Capper, panelists Hector Escobar, Frank Landreneau, Steve Recobs and Joe Ringer discussed what companies need to know if they are doing or want to do business internationally. Below are key takeaways from each panelist. Part of the value of being a client of PKF Texas is receiving invitations and summaries like these with information which can have an impact on your business. We welcome your feedback and suggestions of future interests!
Global Trade Expert, Regions Bank
- Cash in advance is not as predominant in the market as it once was, mainly due to the recession. Letters of credit are growing in use for companies doing business overseas, especially for government backed loans.
- Banks only deal with documents so be sure to thoroughly check for discrepancies, as it may mean the difference when securing the loan. If there are discrepancies, the bank won’t be able to pay you.
Director, International Tax, PKF Texas
- The IC-DISC tax incentive is beneficial for middle market closely held companies who are exporting goods and services overseas. Companies have to meet certain criteria to qualify, but it’s worth exploring. One of the strongest benefits is reduced tax rates.
- Exporting is usually the first step companies take when looking to do business internationally. It takes very little infrastructure in the foreign jurisdiction to get started. Be aware of triggers which could create a taxable presence in the country you are expanding to.
Director, U.S. Commercial Service, Houston Texas
- Entrepreneurs need to understand the country and the culture of where they are looking to do business. The U.S. Commercial Service frequently helps companies vet vendors and research markets. Located on or near almost every U.S. Embassy, they can help develop an export plan, assist with the due diligence process and even make client connections.
- If you’re working with vendors in foreign markets, you need to be sure you’re in compliance with the Foreign Corrupt Practices Act (FCPA). Make sure you know your buyers and do your research on legal ways to do business in the country you’re targeting. The U S Commercial Service web page www.Export.gov is an great resource for learning more about a variety of exporting topics.
Senior Export Finance Manager, Southwest Regional Office – Ex-Im Bank
- Most small and mid-size business exporters need export working capital and/or short term export credit insurance. Ex-Im Bank, as the official export credit agency of U.S. government, provides a 90% guarantee to lenders, who in turn provide exporters with Export Working Capital. Ex-Im Bank has a pilot program called Global Credit Express to fund up to $500,000 for qualified small business exporters.
- Exporters can apply directly to Ex-Im Bank or through a registered Ex-Im Bank insurance broker for any of its insurance products. These products allow exporters to sell on open account terms in 145 countries. Therefore helping the exporter to be more competitive in the international marketplace.