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With the introduction of S/4HANA, SAP provides a new International Trade function within the Governance, Risk and Compliance component. International Trade is in a sense the successor of the foreign trade functions of the ECC. It has been newly implemented and contains more functions than SD-FT but is not as powerful as SAP Global Trade Services (GTS).

International Trade with S/4HANA provides the following functionalities [1]:

  • Classification for International Trade

    • Classification of products with commodity codes and Intrastat service codes.

    • Classification of products with control classes and control groups for legal control.

    • Retransfer of commodity codes from SAP GTS to SAP S/4HANA.

  • International Trade Compliance

    • Legal Control

      • Control of legal regulations for import and export.

      • Managing of licenses in accordance with legal control for import and export.

      • Managing and release of blocked legal control documents

    • Embargo

      • Manage countries under embargo

      • Manage documents

      • Release of blocked documents

    • Intrastat – Managing Intrastat declarations and their master data.

    • Integration with SAP Global Trade Services lets you use SAP GTS functionalities in your processes.

    • Integration with SAP Watch List Screening lets you check business partners in purchase orders, sales orders, and outbound deliveries.

The solution monitors the creation of purchase and sales orders. It checks all international trade-related documents and blocks them, if e.g. an invalid license is provided, or legal regulations are not fulfilled. Missing data can also be a reason to block a document. The user can monitor and unblock resp. re-check documents from international trade Fiori Apps.

In the DSAG meeting June 2021 of the SIG Global Trade Management SAP announced, that the International Trade functions will be integrated into the Trading Contract similar it is done with GTS.

The Legal Control and Embargo Check as well as the integration with SAP Watch List Screening will be done at Trading Contract level before you release the Trading Contract.

I welcome this decision as it gives us the possibility to better control the trade processes and reduce the steps of handling the end-to-end processes across MM, SD and GTM within S/4HANA.

It is also an advantage for companies not being an Global Trader but importing goods. Because with this you will be able to add a new position in your purchase document, which can not be done in a purchase order which is subject to International Trade. This is the case, because an already created purchase order can not be set to hold any more, which would be necessary, if the International Trade check fails.

Furthermore with double-sided Trading Contract you are able to handle drop-shipment process (or Third-Party Process as it is called within the SD world) [2].

Update: With S/4HANA 2021 International trade was integrated into the trading contract. [3]

[1] see SAP Help International Trade, called 2021-06-12

[2] see International Trade not Ready yet for Third-Party Orders, called 2021-06-12

[3] see SAP Help - International Trade in Trading Contract, called 2022-05-09
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