2025 Trade Compliance Trends: Insights Shaped by 2024

Global trade compliance underwent massive changes in 2024, driven by increased enforcement actions, evolving regulations, and a complex geopolitical landscape. A few leading agencies playing key roles in shaping global trade compliance include:

• EU: The European Commission (EC) and European External Action (EEAS)
• UN: The World Trade Organization (WTO) and UN Security Council (Sanctions Committee)
• UK: The Department for Business and Trade’s (DBT) Office of Trade Sanctions Implementation (OTSI), HM Treasury’s the Office of Financial Sanctions Implementation (OFSI), and Department for International Trade (DIT)
• US: The United States has several agencies that work together in specific areas of trade compliance, which are:
  • Office of Foreign Assets Control (OFAC)
  • Bureau of Industry and Security (BIS)
  • Department of State (DOS)
  • Department of Justice (DOJ)
  • Department of Homeland Security (DHS)
  • U.S. Customs and Border Protection (CBP)

Increased penalties and scrutiny throughout global trade underscore the urgency of organizations adapting and staying ahead in mitigating risks while ensuring ongoing trade compliance. In this article we will be highlighting major updates including links to resources and insights that we shared over the past year. Additionally, a forecast of trade compliance trends we expect to see in 2025.

Key Takeaways

• In 2024, we saw unprecedented fines and penalties, highlighting the importance of complying with global trade regulations.
• New rules introduced by major regulatory agencies reflect an evolving landscape for trade compliance.
• Multiple global agencies intensified efforts to address forced labor practices and sanctions evasion in global supply chains.
• Advanced technology has become essential for safeguarding trade compliance, making developing mature compliance programs critical to avoiding hefty fines.

2024 marked a major increase in enforcement activity, and regulators imposed record-breaking penalties. Various enforcement measures throughout the year highlight the financial and reputational damage of non-compliance.

Agencies like the U.S. DOJ, DOS, BIS, FinCEN, and OFAC prioritized cracking down on sanctions and export control violations. One notable case involved a major U.S. bank— which settled on a $1.3 billion fine for lapses in third-party due diligence, facilitating illicit trade activities and violating the Bank Secrecy Act.

OFAC continued to demonstrate its willingness to impose extraterritorial enforcement actions, by issuing its largest monetary penalty of the year, $20 million, against a Thailand-based company for violating Iran-related sanctions. The DOS also reached a $200 million settlement with a defense contractor agreement for violations of the International Traffic in Arms Regulations (ITAR) which were brought upon by failure to address success liability risks during a merger and acquisition.

DOJ issued approximately one-third more penalties related to Foreign Corrupt Practices Act (FCPA) and sanctions evasion in 2024 compared to 2023, including a $364 million fine imposed on an aerospace and defense company for FCPA and export control violations. Additionally, BIS fines and penalties against companies for unauthorized technology exports to restricted countries indicated significant focus in this area. One noteworthy case is a $5.8 million penalty against an electrical manufacturer for violating Export Administration Regulations (EAR) by shipping items for prohibited end-uses in China.

The UK’s FCA enforced the largest sanctions violation fine of the year in Europe against a bank for weak sanctions screening systems enabling transactions in restricted jurisdictions.

Advanced technologies such as semiconductors and AI components have drawn increased attention from regulators, while companies circumventing export restrictions face severe consequences. These enforcement actions emphasize the need for vigilant adherence to compliance standards.

Figure 1: Financial impact of enforcement actions

Source: BIS, OFAC, FinCEN, DOS, and DOJ

New policies implemented in 2024 required businesses to rethink and enhance their trade compliance protocols. Key regulatory updates include:

• Extended record-keeping requirements: OFAC now mandates businesses to retain records for 10 years — doubling the previous requirement. This shift amplifies the demand for robust documentation and secure data management systems. It also doubles the exposure window to enforcement actions.
• New export controls: BIS has implemented strict new controls on emerging technologies, such as artificial intelligence and clean energy, as well as policies that curb sanctions evasion efforts, and increase transparency and accountability.
• Enhanced due diligence guidelines: The UK’s Department for Business and Trade published the Trade, Aircraft, and Shipping Sanctions (Civil Enforcement) Regulations 2024, emphasizing the need for compliance in international partnerships and cross-border transactions. These regulations increase the department’s ability to take enforcement actions against trade sanctions violators.

Adapting to these changes requires businesses to leverage advanced technology, streamline trade compliance processes, and invest in targeted employee training.

Figure 2: Key Regulatory Updates in 2024

Supply chain compliance remains critical, especially regarding forced labor, environmental, social, and governance (ESG), and sanctions evasion.

The Uyghur Forced Labor Prevention Act (UFLPA) seized goods worth $1.73 billion throughout 2024. Multinational collaboration between agencies in the EU, UK, U.S. and Canada has resulted in stricter measures targeting entities attempting to evade these sanctions throughout the supply chain.

Enhanced coordination and more severe penalties underscore the need for companies to implement rigorous compliance protocols, especially in high-risk regions.

Figure 3: CBP shipment metrics June 2022 – December 2024

Source: CBP

Utilizing robust denied party screening systems to thoroughly vet trade partners has never been more important in meeting forced labor compliance requirements and ESG goals.

Figure 4: Industries most impacted by UFLPA enforcement actions

Source: CBP

Amid an increasingly complex global trade environment, the intersection of technology and trade compliance reached new heights, prompting organizations and regulators to adopt sophisticated tools for manage risks and strengthening enforcement actions effectively.

Regulators are not only expanding their use of technology to flag and address suspicious activities but are also considering the adoption of export and trade compliance software solutions when determining the severity of enforcement actions for violations.

Additionally, they have tightened export controls on emerging technologies, such as AI, quantum computing,  and space technology, increasing the complexity of trade compliance to prevent unauthorized military use.

Innovations in AI and machine learning are enhancing critical trade compliance functions, such as:

• Advanced algorithms help to identify high-risk transactions and entities, streamlining processes for trade compliance teams.
• AI and machine learning improve the accuracy of denied party screening, reducing false positive alerts.
• AI systems expedite the export classification of goods and export licensing which helps meet complex export control regulations.

Figure 5: Essential features of a best-in-class denied party screening software

Preparing for the Future: Top Emerging 2025 Trade Compliance Trends

The compliance landscape will continue to evolve, creating new challenges for businesses. A few trends we expect to see continue into this year and beyond:

• Stricter controls on emerging technologies: AI, clean energy tech, and other advanced technologies will likely face stricter export controls as governments aim to prevent their misuse and safeguard a competitive landscape.
• Increased regulation of trade due to global factors: Trade compliance will be significantly shaped by a range of global factors that introduce uncertainty and complexity. Geopolitical tensions, such as ongoing conflicts with Russia and developments in Syria, will likely lead to more stringent sanctions and trade restrictions. Additionally, rising concerns over national security could prompt further regulatory tightening in cross-border trade.
• Higher expectations for supply chain compliance: Businesses will face heightened expectations for supply chain oversight as governments and stakeholders demand greater accountability. Organizations must navigate shifting tariffs and trade policies while addressing stringent forced labor regulations. ESG priorities will further integrate into trade compliance requirements, driving the need for sustainable and ethical practices.
• AI integration in regulatory oversight: Regulatory agencies are expected to adopt AI and analytics tools to more efficiently identify non-compliance, raising the bar for businesses to meet expectations.

Organizations that proactively address emerging trends will be better positioned to manage risks effectively while capitalizing on global trade opportunities.

Navigating the complexities of trade compliance in 2025 requires a proactive and multifaceted approach, including:

1. Implement supply chain resilience: Prioritize compliance with forced labor regulations, ESG goals, and trade restrictions. 
2. Invest in Advanced Technology: Equip compliance programs with tools that enhance efficiency and resilience. 
3. Adapt to Evolving Policies: Monitor regulatory changes and be ready to pivot strategies. 
4. Engage with Experts: Leverage partnerships with consultants and legal advisors to bolster compliance efforts.

Descartes offers industry-leading trade compliance solutions designed to streamline processes, strengthen oversight, and reduce risks. Leverage our insights and advanced technology to future-proof your trade compliance strategy and reduce the burden on internal teams, allowing for a more efficient and effective approach to managing whatever global trade challenges may come.

2024 proved that global trade compliance is more complex than ever, with shifting regulations, geopolitical changes, and rising demands for transparency. To stay ahead, businesses must embrace agility, proactive strategies, and advanced tools. 

Ready to get ahead of what’s next? Contact us today and ensure your business thrives in the dynamic world of global trade.