How to Succeed in International MarketsHouston May 3th

Lars Mylius Davidsen

First move ! – opening remarks

• Potential markets for your product

• Hire

• a good lawyer,

• a banker with common sense

• a good accountant

• a logistics specialist,

• Each of whom specializes or understands international

transactions

• You may feel you can't afford these professional services, but

you really can't afford to do without them

Show me the money!

• The most important thing to start with before closing an

international sale — lucky for you if you’ve gotten this far

— is how payment (collection) will be made

• Agree on the terms of payment in advance, and never, ever

sell on open account to a brand new customer

• No ifs, ands or buts. Just don't

• Several strategies for getting paid in full and on time while

minimizing risks

NORDIC BANKING ENVIRONMENT AND SERVICES ARE UNIQUE

DON’T EXPECT NORDIC BANKING SOLUTIONS ABROAD

The US banking system is far more complexand manual compared withNorway

Sources: World Bank, Bloomberg

Number of bank

branches per 100.000

inhabitants (2014)

32,4

8,6

~120 – 140

~40 – 50

Number of ATMs

per 100.000

inhabitants

INDICATIVE NUMBERS

Cards and electronic based payments are more common

in Norway than in the US

Sources: Fed Notes, CapGemini – World Payments Report, Norges Bank - Utviklingstrekk i kunderetta betalingsformidling – 2015

INDICATIVE DISTRIBUTION 2014

CASH TRANSACTIONS

~43-48 %

~2-5 %

CHECK TRANSACTIONS

~5-9 %

~0 %

CARD TRANSACTIONS

~37-42 %

~94-98 %

Payments Methods – the new realityDigital wallet are the electronic devices that allow individuals to make e-commerce

Consumer to consumerOnline tools that allow individuals to complete financial transactions with one another

Consumer to Business

These are the major payment services which allow users to make payments via a mobile device

Business to Business

These companies provide realtime online payment processing. Their digital payment networks

connect with financial instititions to facilitate bank transfers.

Choosing Banking Provider

If possible choose your current bank as provider abroad

• It is easy and often competitive on pricing

• Pricing Depends on specific needs and volume

• The bank knows you and you know them! (time saving!)

• Incoming and outgoing payments can be managed out of

Norway

• Always discuss trade finance and letter of credit in advance

with your bank

• Risk control and risk reduction

Choosing Banking Provider

– Follow your bank abroad

If your current bank has branches or partners

in your new market

• If the incoming and/or outgoing payment volume is

substantial or facing any sort of unique local requirements

– then open local accounts in the new market

• Direct access to local infrastrucure, local cut-off times and domestic prices

• Local account services and structures

• Payment services

• Collection services

• E-banking

• Other services (Trade Finance e.q)

Choosing Banking Provider

– open accounts locally

If you need a local bank in the new market;

• Ask your present bank to recommend a local bank;

• Strong and friendly bank

• Regional / global access/network

• Good infrastructure : eBanking solution and can be connected to your

present bank (SWIFT member)

• Eestablishing a banking relationship and opening bank

accounts abroad can be a time-consuming process

• Document processing

• KYC (Know Your Client)

Good KYC (Know Your Client) reduce

AML Risk for the banks

• When it comes to Anti Money Laundering, it contains two

important pillars:

Where does the money come from?

Who controls the company(funds)?

• You must be able to document where your money comes

from (Source of funds)

• Who control the company (ultimate beneficial owners), make

sure you have org. charts, and other documentation that can

confirm ownership. (list of all shareholder holding more than

10%, are there different share classes A,B etc. give the bank

that information)

When establishing abroad think of the

corruption risk.

• Ensure your company has a clear set of

guidelines when it comes to anti

corruption and bribery, do your business

partners have one also?

• Transparency international will give you

an idea: https://www.transparency.org/

• Transactions

• Transaction monitoring varies

between countries. Singapore and

US have advanced monitoring.

Especially when it comes to

sanction screening

List of documents, Information the bank

will require

• Certificate of registration

• Articles of association

• Articles of incorporation

• Government issued Identification for

persons who can sign in behalf of the

company (Passports, certified copies)

• Name and date of birth of the board

members and CEO or other that has

been given a Power of attorney

• How do you intend to use the bank

account and which products

• Cross border transactions, how much,

how many and where is the money going

or coming from

Sanctions

Important to know

which sanctions you

need to be aware of

when doing business

abroad

UN Sanctions

All members of the UN

are legally obliged to

follow the UN sanction

laws

FACTA

The Fair and Accurate

Credit Transactions Act

EU Sanctions

The EU and the US

sanctions are not

coordinated in most

sanction regimes with

the consequence that a

transaction may be

legal in NOK/EUR/GBP

but not in USD. The

sanction regulations are

very complicated and

highly dynamic and it is

important to pay

attention to countries

with high sanction risk

and companies doing

business in industries

with a high sanction

risk.

US Sanctions

Consists of economic

sanctions and US

export controls.

US authorities

vigorously enforces the

US sanctions giving

huge fines to financial

institutions both in the

US and in the EU.

US authorities can also

chose to exclude

financial institutions

from the US financial

market if the breach of

the US sanctions is

deemed as severe.

DNB’s geographic footprint

Oslo

AberdeenLondon

Athens

Luxembourg

Helsinki

Warsaw

Tallinn

RigaVilnius

Copenhagen

Hamburg

Gothenburg

Stockholm

New York

Houston

Rio De Janeiro

Santiago

Shanghai

Singapore

Mumbai

Huge opportunities!

Choose a bank who knows the industry

• Banking Infrastructure

• Sanctions

• KYC/AML