Legal Considerations in Global Sourcing Under New Trade Policies

In today’s increasingly unpredictable trade environment, legal risks in global sourcing are no longer just the concern of legal departments—they’re a central challenge for procurement and supply chain leaders. The rise of new tariffs, shifting trade agreements, and geopolitical pressures has created a legal minefield that businesses must navigate carefully.

From contract renegotiations to compliance with export controls, companies engaged in global sourcing must proactively adapt to avoid costly mistakes and maintain operational continuity.

The Growing Complexity of Trade Policies

Over the past few years, trade policies have shifted rapidly. The recent tariff threats and trade proposals by former President Donald Trump signal a continued return to protectionist rhetoric, which has real legal implications for global businesses.

New tariffs on imports from countries like China, and the European Union mean that sourcing agreements must now account for potential cost surges, regulatory changes, and retaliatory measures. Failing to anticipate these shifts can lead to contractual disputes or major supply chain disruptions.

Key Legal Challenges in Global Sourcing

1. Contract Management Amid Uncertainty

Standard sourcing contracts may not adequately address the fast-changing trade landscape. Companies must now include force majeure, tariff escalation, and termination for convenience clauses to protect themselves against sudden shifts in duties or import bans.

Reviewing and updating supplier agreements is crucial to ensure that pricing terms, delivery obligations, and dispute resolution mechanisms reflect today’s complex realities.

2. Regulatory Compliance and Export Controls

Trade compliance is more than paying the right duties—businesses must also navigate export control laws, import licensing, and sanctions enforcement. Violations can lead to heavy fines or revocation of trade privileges.

Countries like the U.S. and members of the EU have stringent regulations on goods classified as dual-use (civilian and military applications), and the wrong classification or routing can expose companies to legal scrutiny. Resources like the U.S. Customs and Border Protection and International Trade Administration provide guidance, but expert legal counsel is often required for complex supply chains.

3. Tariff Mitigation and Duty Drawback Strategies

Businesses impacted by tariffs often seek relief through legal mechanisms like duty drawback programs or reclassification under Harmonized Tariff Schedules (HTS). These require thorough documentation, accurate recordkeeping, and sometimes legal challenges or appeals.

Partnering with legal experts and sourcing professionals can help evaluate whether components qualify for lower-duty codes or are eligible for refunds on re-exported goods.

4. Jurisdiction and Dispute Resolution

Global sourcing contracts should clearly define applicable law and jurisdiction. Disputes that arise in international trade often fall into legal gray areas unless arbitration or litigation procedures are explicitly outlined. Consider including International Chamber of Commerce (ICC) arbitration clauses or other neutral venues in your contracts to prevent biased rulings.

5. Intellectual Property Protection

When sourcing from new or emerging markets, companies must ensure their designs, technology, and trade secrets are protected. Not all countries offer strong IP enforcement, so contracts must include clear language on ownership, licensing, and remedies for infringement.

Best Practices for Legal Risk Mitigation in Sourcing

To stay compliant and agile in a turbulent trade environment, companies should:

• Conduct regular legal reviews of sourcing contracts.

• Maintain detailed records of all imports, including classification, origin, and valuation.

• Stay informed about changes in global trade laws.

• Work with sourcing specialists who understand local legal environments.

Why EDS International Is the Partner of Choice

At EDS International, we help businesses build resilient, compliant sourcing strategies by focusing on transparency, quality, and agility. Our team monitors the global sourcing environment to help clients anticipate risks and pivot quickly when regulations or costs shift.

While we don’t provide legal advice, we bring decades of experience navigating complex international sourcing scenarios. From supplier vetting to quality control, we ensure every link in your supply chain is strong—and ready for change.

Looking for a sourcing partner who stays ahead of trade policy disruptions? Contact EDS International today to future-proof your supply chain.