Foreign trade criminal law & customs criminal law

Foreign trade criminal law

Customs criminal law

Voluntary disclosures

AWV (Foreign Trade and Payments Ordinance) filings

Lawyer for foreign trade criminal law and customs criminal law in Munich

Criminal Defense in International Trade Law Regarding Sanctions, Export Controls, and Customs Violations

Foreign trade criminal law addresses criminal and administrative penalty risks associated with the international movement of goods, services, capital, and payments. The focus is often on sanctions, export controls, dual-use goods, licensing requirements, or foreign trade reporting obligations. Customs criminal law, on the other hand, deals in particular with false customs declarations, customs evasion, import sales tax, breach of customs seals, smuggling, and tax receiving of stolen goods.

schirach.law advises and represents companies, entrepreneurs, managing directors, executives, and private individuals nationwide in connection with preliminary investigations, searches, foreign trade and customs audits, as well as potential violations of sanctions and export control regulations.

In addition, we provide proactive advice on criminal law risks associated with international business models.

In foreign trade law in particular, legal foundations can change on short notice. For this reason, it often depends on which regulation was in effect at the time of the specific transaction, what information was available to those responsible, and which reviews were actually conducted.

What is foreign trade criminal law?

Foreign trade criminal law covers criminal offenses and administrative violations in cross-border commercial transactions.

The key legal foundations include, in particular, the Foreign Trade Act (AWG), the Foreign Trade Regulation (AWV), directly applicable European sanctions regulations, and the European Dual-Use Regulation.

The regulations may apply to goods, services, financing, investments, technical assistance, software, technology, and other economic resources.

Therefore, a violation of foreign trade law does not arise solely from the physical export of goods. Services, digital data transfers, financing, or indirect transactions conducted through other companies may also be subject to criminal or administrative penalties.

Schirach.law specializes in foreign trade and customs criminal law.

schirach.law advises and defends clients in criminal and administrative offense proceedings related to foreign trade and customs law. Within the team, particular areas of expertise include foreign trade reporting obligations, self-monitoring notifications, and criminal charges related to customs and import duties.

Attorney Marco Benedikt von Schirach is a specialist lawyer for criminal law and a certified defense attorney for white-collar crime and tax crime (DSV eV). His work focuses on complex white-collar and tax crime proceedings as well as providing legal support to companies, entrepreneurs, and executives.

Attorney Julian Korbinian Huber has particular expertise in cases involving violations of foreign trade reporting obligations to the Deutsche Bundesbank. His work includes, in particular, the review and correction of omitted or incorrect reports under the Foreign Trade and Payments Ordinance (AWV), as well as the preparation of charges in connection with such reporting violations.

Attorney Frédéric Heindel, LL.B., specializes in customs criminal law. His focus is on defending clients accused of customs evasion and criminal matters related to import duties. As a Certified Defense Attorney for Tax and White-Collar Crime (DSV eV), he also possesses relevant additional qualifications at the intersection of tax and white-collar crime law.

When should you consult a lawyer specializing in foreign trade criminal law?

As early as possible—especially before those responsible provide detailed statements to customs officials, the main customs office, the public prosecutor’s office, or the BAFA.

Consulting on foreign trade criminal law is particularly useful when

the Main Customs Office or the public prosecutor's office initiates proceedings,
a search or seizure takes place,
when customs detains goods or shipments,
a company may have exported goods without the required authorization,
If there are doubts regarding the final recipient or end use,
if a match is found on a sanctions list,
if a shipment via a third country appears problematic,
a company discovers a potential violation internally,
AWV reports are missing or contain errors,
a foreign trade or customs audit is imminent,
the BAFA requests documents or explanations, or
Managing directors, export control officers, or other employees may personally come under scrutiny.

However, seeking early legal advice does not mean issuing a statement right away. First, the allegations, the legal situation, the documentation, and any potential personal liability should be clarified.

This is because voluntary disclosures, documents submitted later, and early statements can significantly influence the further course of proceedings.

Criminal Law Governing Foreign Trade: Offenses Under Sections 17 and 18 of the Foreign Trade Act (AWG)

The Foreign Trade Act contains separate provisions governing criminal penalties and administrative fines.

Section 17 of the AWG specifically addresses certain violations of economic sanctions related to military goods. Section 18 of the AWG also covers numerous other violations of sanctions, export control, and licensing regulations.

Which criminal provision applies therefore depends on the specific transaction and the relevant legal act.

The following, among other things, may be relevant:

prohibited imports or exports,
Deliveries and Disclosures,
Funding and support services,
technical assistance and mediation,
Prohibited services,
Provision of funds or economic resources,
certain investments,
Circumventing actions, as well as
Unauthorized exports of dual-use goods.

The potential ranges of penalties vary considerably. For this reason, an alleged offense should not be assessed solely on the basis of the general term “sanctions violation.”

What is far more important is which specific provision the person in question is alleged to have violated and which subjective requirements the investigating authorities can prove.

Sanctions and Embargo Violations in Foreign Trade Criminal Law

Through sanctions, the European Union restricts, among other things, trade, financial transactions, services, and the provision of economic resources.

This may affect countries and regions, as well as individuals, companies, organizations, and indirectly controlled entities.

Criminal liability risks arise, for example, in the following situations:

Shipments to sanctioned recipients,
prohibited imports or exports,
Provision of funds or economic resources,
prohibited financial or other services,
Transactions with controlled entities,
false information regarding the recipient or end use, as well as
a prohibited circumvention of sanctions.

However, a hit in screening software does not in itself prove a violation. Conversely, the absence of an exact name match does not necessarily rule out the risk of sanctions.

Therefore, ownership structure, control, the economic beneficiary, and the specific transaction must be considered together.

Sanctions Lists, Ownership, and Control

Sanctions regulations may affect more than just the individuals and companies directly listed.

Depending on the applicable legal act, ownership and control relationships may also be relevant.

Therefore, an audit should, in particular, clarify:

Who holds shares in the company?
Who has voting rights?
Who can appoint the management?
Who stands to benefit financially from the transaction?
Are there any trust or straw man arrangements?
Who actually exercises control?

For this reason, automated name matching is often insufficient, particularly in the case of international ownership structures.

During the preliminary investigation, it must then be determined whether the authorities have accurately assessed the ownership or control structure and to whom the potential violation can be personally attributed.

Circumvention of Sanctions and Shipments via Third Countries

Proceedings under foreign trade criminal law increasingly involve transactions conducted through intermediaries, subsidiaries, or third countries.

For example, unusual supply chains, trading companies brought in at the last minute, unclear end users, or contradictory contract documents may raise red flags.

Changes to product names, customs tariff codes, or payment methods can also trigger inquiries.

However, such circumstances do not automatically prove intentional circumvention.

For the defense, what matters much more is how the transaction came about, what information was available, what due diligence was conducted, and what economic purpose the chosen structure served.

Export Controls and Dual-Use Goods in Foreign Trade Criminal Law

Dual-use goods can be used for both civilian and military purposes.

Regulation (EU) 2021/821 establishes a central European legal framework for the control of such goods. Depending on the product, recipient, destination country, and end use, prohibitions or licensing requirements may apply.

This may affect, for example, machinery, electronics, sensors, software, chemicals, and certain technologies.

The following questions are particularly important for an export control review:

How would you classify this product from a technical standpoint?
Is it included in a relevant list of goods?
Is a permit required?
Does a general authorization apply?
Who is the actual end user?
What is the intended end use?
Are there any additional state or financial sanctions?

Even goods that are not listed may be subject to a licensing requirement under certain conditions.

For this reason, the review should not be limited solely to tariff codes or automated list matches.

Software, technical support, and expertise

Export controls do not apply only to physical goods.

Software, technology, technical assistance, intermediary services, training, and digital data transfers may also be subject to restrictions under foreign trade law.

Risks can arise, for example, when employees

submit technical documentation electronically,
grant foreign partners access to IT systems,
Provide maintenance or consulting services,
Deploy software or updates,
conduct technical training sessions or
share controlled expertise within an international corporate group.

Companies should therefore include digital information flows and services in their export controls, in addition to the shipment of goods.

Criminal Law Governing Foreign Trade: Responsibilities of Management and Export Control Officers

Companies often assign foreign trade-related responsibilities to the executive management, export control, sales, purchasing, logistics, engineering, and compliance departments.

If a potential violation occurs, individual responsibility must therefore be determined.

The following factors are particularly important:

internal responsibilities,
Decision-making and approval authority,
available information,
Review and escalation procedures,
human and technical resources, as well as
How to handle warning labels.

Delegating operational tasks does not automatically relieve the executive board of its responsibilities.

Conversely, an export control officer is not automatically personally responsible for all of the company's business transactions.

A sound defense must therefore examine the role, knowledge, and specific contribution of each person involved separately.

Criminal Law Governing Foreign Trade: Searches and Preliminary Investigations

During a search, those affected should remain calm, offer no resistance, and contact a criminal defense attorney as early as possible.

As a matter of principle, no statements regarding the allegation should be made without prior consultation.

In investigations into possible foreign trade violations, law enforcement agencies often search for contracts, invoices, export documents, emails, technical documentation, payment information, and internal approvals.

The defense must then clarify the following in particular:

What is the alleged offense listed in the search warrant?
Which stores and time periods are affected?
Which sanctions or export control regulation serves as the basis?
What documents and data were seized?
Are there more delivery suspensions or asset-freezing measures on the horizon?
Which business transactions need to be reviewed immediately?

At the same time, the company must ensure the continuity of its business operations and prevent any further violations.

Foreign Trade Audit and Customs Audit

Foreign trade and customs audits can reveal potential violations and may later lead to fines or criminal proceedings.

For example, the following are tested:

Export licenses,
Goods classifications,
Export certificates,
Final disposition documents,
Sanctions reviews,
Customs declarations,
Origin and Preferences,
Import duties,
Foreign trade reports and
Internal control processes.

Companies must comply with their legal obligations to cooperate during the audit process. At the same time, those responsible should be mindful of potential personal risks of criminal prosecution or fines.

As soon as a critical situation begins to emerge, the audit and defense strategy should therefore be coordinated.

AWV Reporting Requirements and the 50,000-Euro Threshold

The Foreign Trade Regulation contains statistical reporting requirements for certain cross-border payments, receivables, liabilities, and equity interests.

As of January 1, 2025, a reporting threshold of 50,000 euros generally applies to payment reports. However, § 67 of the AWV contains important exceptions.

Whether a report is required therefore does not depend solely on the amount of a transfer.

What is relevant, rather, is the economic transaction, the individuals involved, and the legal exceptions.

Failure to file, late filing, or incorrect filing of reports may constitute an administrative offense.

However, anyone who discovers a gap should not automatically report all transactions in an uncoordinated manner. First, the scope, time periods, responsibilities, and the possibility of a self-reporting requirement should be reviewed.

Self-inspection Report Pursuant to Section 22(4) of the AWG

Section 22(4) of the AWG provides for a special remedy for certain administrative offenses committed through negligence.

Prosecution for an administrative offense will not proceed, provided the statutory conditions are met, if the company discovers the violation through its own internal controls, voluntarily reports it to the competent authority, and takes appropriate measures to prevent a similar violation in the future.

The report is considered voluntary only if the competent authority has not yet launched an investigation into the violation.

It is therefore important to draw a distinction:

A voluntary disclosure pursuant to § 22(4) of the AWG is not a general voluntary disclosure that exempts the discloser from criminal liability.

In particular, it does not automatically preclude potential criminal liability under Sections 17 or 18 of the AWG.

Before making a disclosure, it should therefore be clarified whether

what violation actually occurred,
whether intentional or negligent conduct is a factor,
which processes are affected,
whether authorities are already investigating,
who might be personally responsible, and
what improvement measures are needed.

Properly Address Internally Discovered Export Violations

If a company discovers a potential foreign trade violation on its own, it should first document the facts and reconstruct the sequence of events in a structured manner.

Typical triggers include internal controls, reports from employees, inquiries from banks, subsequent changes to a goods classification, or doubts about a business partner.

First, we should clarify:

Which stores are affected?
What was the legal situation at the time in question?
Who was involved in the review and approval process?
What documents and communication records are available?
Do we need to stop any further shipments or payments?
Is a self-reporting notice an option?

Internal communication and external communication should follow a common strategy.

This is because findings from an internal investigation may later become relevant in criminal, fine, or administrative proceedings.

Preventive Consulting and Export Control Compliance

Effective export controls must be tailored to the company's actual operations.

Standardized checklists alone are therefore not enough. Companies should realistically assess their products, customers, target countries, distribution channels, and services.

From a criminal law perspective, clear lines of responsibility, documented approval processes, and transparent decisions in response to warning signs are particularly important.

A compliance system that exists only on paper offers no protection if the company does not implement it in its day-to-day operations.

Conversely, robust audit and documentation processes can show what information those responsible had and how they responded to identifiable risks.

Criminal Customs Law: Customs Evasion, Breach of Bond, and Smuggling

Customs criminal law concerns criminal and administrative offenses related to the cross-border movement of goods.

Typical accusations include:

Customs evasion,
Evasion of import sales tax,
Breach of a prohibition under Section 372 of the German Fiscal Code (AO),
smuggling for commercial purposes or as part of an organized group under § 373 of the German Fiscal Code (AO),
Tax Evasion under § 374 of the German Fiscal Code (AO),
incorrect customs declarations,
false information regarding customs value or origin, as well as
Violations of import and export bans.

However, not every false customs declaration constitutes intentional customs evasion.

Inaccurate master data, complex product classifications, delivery terms, or organizational shortcomings can be decisive factors in a criminal assessment.

Therefore, the defense must examine both the tax assessment and the allegation of personal liability.

For more information on criminal tax law issues, please see the Criminal Tax Law section.

Criminal Customs Law: Goods Detained by Customs—What Should You Do?

If customs detains a shipment, the specific reason for the action should first be clarified.

Possible causes include missing documentation, doubts regarding the classification of goods, suspected violations of export controls or sanctions, or an ongoing investigation.

For companies, a halt in deliveries can have significant economic consequences. At the same time, those in charge should not make hasty statements that could later be used against them in criminal or administrative proceedings.

Therefore, the first step should be to examine:

Which products are affected?
Which documents or permits are missing?
Is there a dispute over a tariff code or the classification of goods?
Is there a suspicion of sanctions violations?
Who was responsible for the registration?
Are there any criminal or administrative proceedings already underway?

Voluntary Disclosure in Cases of Customs Evasion

In the event of possible customs evasion, a voluntary disclosure that exempts the taxpayer from punishment may be considered under the conditions set forth in § 371 of the German Fiscal Code (AO).

However, it pertains to tax offenses and must be clearly distinguished from a voluntary disclosure under § 22(4) of the AWG.

In particular, a voluntary disclosure must be complete, timely, and accurate with respect to the relevant tax matters. Furthermore, there must be no statutory grounds for exclusion.

Other criminal offenses under foreign trade law are not automatically resolved by filing a voluntary tax disclosure.

Therefore, before any disclosure is made, it should be clarified which fees and time periods are affected and whether there are also any violations of prohibitions or permit requirements involved.

Criminal Law Governing Foreign Trade and Related Areas of Law

Foreign trade criminal law and customs criminal law often overlap with other areas of commercial and tax criminal law.

In the context of international payment systems, for example, issues related to criminal money laundering laws may arise. Customs evasion is also closely linked to criminal tax law. In complex business situations, additional charges under white-collar crime law may also arise.

For this reason, a set of facts should not be artificially reduced to a single element of a crime.

Rather, potential foreign trade, customs, tax, and economic crimes must be examined in their actual context.

Criminal Law Governing Foreign Trade and Customs in Munich and Nationwide

In the areas of foreign trade criminal law and customs criminal law, schirach.law advises and defends clients nationwide from its Munich office.

These services are aimed in particular at companies, entrepreneurs, managing directors, executives, and private individuals facing complex issues related to foreign trade and customs criminal law.

In-person meetings can be held in Munich. In addition, we provide legal representation in preliminary investigations, administrative fine proceedings, and criminal proceedings throughout Germany.

For more information on our areas of practice, see “Areas of Expertise” on the schirach.law website.

Frequently Asked Questions About Foreign Trade Criminal Law and Customs Criminal Law

What does foreign trade criminal law cover?

Foreign trade criminal law covers criminal offenses and administrative violations in the international trade of goods, services, capital, and payments. These include, in particular, violations of sanctions, unauthorized exports, dual-use violations, and certain violations of foreign trade reporting requirements.

What is the penalty for violating sanctions?

The range of penalties depends on the specific violation. Sections 17 and 18 of the AWG set forth different criminal offenses and ranges of penalties. Therefore, it must first be determined which specific national or European regulation the person in question is alleged to have violated.

When is an export subject to a license requirement?

A licensing requirement may arise from the nature and technical characteristics of a good, the recipient, the destination country, or the end use. Even goods not listed on the list may be subject to licensing under certain conditions.

What are dual-use goods?

Dual-use goods are goods, software, or technologies that can be used for both civilian and military purposes. Certain dual-use goods are subject to prohibitions or licensing requirements.

Are managing directors personally liable for export violations?

Not automatically. Personal liability under criminal or administrative law depends, in particular, on jurisdiction, knowledge, involvement, and specific conduct.

What should I do if customs holds up a shipment?

First, the rationale and legal basis for the measure should be clarified. Before providing extensive explanations, it should also be determined whether there is already a risk of criminal prosecution or a fine.

Can I submit any missing AWV reports retroactively?

In general, incorrect or missing reports can be corrected or submitted later. However, it should first be determined which transactions are affected and whether a self-inspection report under § 22(4) of the AWG is appropriate.

Does Section 22(4) of the AWG constitute a voluntary disclosure that exempts one from punishment?

No. The provision applies to certain administrative offenses committed through negligence. It does not grant general immunity from punishment for intentional violations or criminal offenses under Sections 17 and 18 of the AWG.

Which payments must be reported under the AWV?

As of January 1, 2025, a threshold of 50,000 euros generally applies to certain cross-border payments. However, there are legal exceptions. Therefore, the specific payment transaction must be reviewed.

Can a voluntary disclosure help in cases of customs evasion?

In cases of customs evasion, a voluntary disclosure under Section 371 of the German Fiscal Code (AO) may result in immunity from prosecution, provided the statutory requirements are met. However, this does not automatically apply to other foreign trade or customs offenses.

Confidential Contact

Suspicions of violations of foreign trade or customs laws can have immediate repercussions on supply chains, permits, assets, and personal liability.

Anyone facing a search, a detained shipment, suspicion of a violation, missing AWV reports, or an allegation under customs criminal law should therefore first clarify the legal situation, the status of the proceedings, and the evidence.

schirach.law provides legal counsel and representation in cases involving foreign trade criminal law and customs criminal law in Munich and throughout Germany.

Theatinerstraße 40–42 VII
80333 Munich

Phone: +49 89 443 695 60
Email: kanzlei@schirach.law