diff --git a/packages/agents-a365-observability/src/ObservabilityBuilder.ts b/packages/agents-a365-observability/src/ObservabilityBuilder.ts
index 08d23cc..65db2b0 100644
--- a/packages/agents-a365-observability/src/ObservabilityBuilder.ts
+++ b/packages/agents-a365-observability/src/ObservabilityBuilder.ts
@@ -5,7 +5,7 @@
 import { NodeSDK } from '@opentelemetry/sdk-node';
 import { ConsoleSpanExporter, BatchSpanProcessor } from '@opentelemetry/sdk-trace-base';
 import { SpanProcessor } from './tracing/processors/SpanProcessor';
-import { isAgent365ExporterEnabled } from './tracing/util';
+import { isAgent365ExporterEnabled } from './tracing/exporter/utils';
 import { Agent365Exporter } from './tracing/exporter/Agent365Exporter';
 import type { TokenResolver } from './tracing/exporter/Agent365ExporterOptions';
 import { Agent365ExporterOptions } from './tracing/exporter/Agent365ExporterOptions';
diff --git a/packages/agents-a365-observability/src/tracing/exporter/Agent365Exporter.ts b/packages/agents-a365-observability/src/tracing/exporter/Agent365Exporter.ts
index 2b49ccb..dd49cab 100644
--- a/packages/agents-a365-observability/src/tracing/exporter/Agent365Exporter.ts
+++ b/packages/agents-a365-observability/src/tracing/exporter/Agent365Exporter.ts
@@ -7,10 +7,19 @@ import { ExportResult, ExportResultCode } from '@opentelemetry/core';
 import { ReadableSpan, SpanExporter } from '@opentelemetry/sdk-trace-base';
 
 import { PowerPlatformApiDiscovery, ClusterCategory } from '@microsoft/agents-a365-runtime';
-import { partitionByIdentity, parseIdentityKey, hexTraceId, hexSpanId, kindName, statusName } from './utils';
+import {
+  partitionByIdentity,
+  parseIdentityKey,
+  hexTraceId,
+  hexSpanId,
+  kindName,
+  statusName,
+  useCustomDomainForObservability,
+  resolveAgent365Endpoint,
+  getAgent365ObservabilityDomainOverride
+} from './utils';
 import logger, { formatError } from '../../utils/logging';
 import { Agent365ExporterOptions } from './Agent365ExporterOptions';
-import { useCustomDomainForObservability, resolveAgent365Endpoint } from '../util';
 
 const DEFAULT_HTTP_TIMEOUT_SECONDS = 30000; // 30 seconds in ms
 const DEFAULT_MAX_RETRIES = 3;
@@ -144,25 +153,26 @@ export class Agent365Exporter implements SpanExporter {
 
     const payload = this.buildExportRequest(spans);
     const body = JSON.stringify(payload);
-
     const usingCustomServiceEndpoint = useCustomDomainForObservability();
-
     // Select endpoint path based on S2S flag
-    const endpointPath =
+    const endpointRelativePath =
       this.options.useS2SEndpoint
         ? `/maven/agent365/service/agents/${agentId}/traces`
         : `/maven/agent365/agents/${agentId}/traces`;
 
     let url: string;
-    if (usingCustomServiceEndpoint) {
+    const domainOverride = getAgent365ObservabilityDomainOverride();
+    if (domainOverride) {
+      url = `${domainOverride}${endpointRelativePath}?api-version=1`;
+    } else if (usingCustomServiceEndpoint) {
       const base = resolveAgent365Endpoint(this.options.clusterCategory as ClusterCategory);
-      url = `${base}${endpointPath}?api-version=1`;
+      url = `${base}${endpointRelativePath}?api-version=1`;
       logger.info(`[Agent365Exporter] Using custom domain endpoint: ${url}`);
     } else {
       // Default behavior: discover PPAPI gateway endpoint per-tenant
       const discovery = new PowerPlatformApiDiscovery(this.options.clusterCategory as ClusterCategory);
       const endpoint = discovery.getTenantIslandClusterEndpoint(tenantId);
-      url = `https://${endpoint}${endpointPath}?api-version=1`;
+      url = `https://${endpoint}${endpointRelativePath}?api-version=1`;
       logger.info(`[Agent365Exporter] Resolved endpoint: ${url}`);
     }
 
diff --git a/packages/agents-a365-observability/src/tracing/exporter/utils.ts b/packages/agents-a365-observability/src/tracing/exporter/utils.ts
index 1a63dfc..c341d73 100644
--- a/packages/agents-a365-observability/src/tracing/exporter/utils.ts
+++ b/packages/agents-a365-observability/src/tracing/exporter/utils.ts
@@ -4,6 +4,7 @@
 
 import { ReadableSpan } from '@opentelemetry/sdk-trace-base';
 import { SpanKind, SpanStatusCode } from '@opentelemetry/api';
+import { ClusterCategory } from '@microsoft/agents-a365-runtime';
 import { OpenTelemetryConstants } from '../constants';
 import logger from '../../utils/logging';
 
@@ -119,6 +120,47 @@ export function isAgent365ExporterEnabled(): boolean {
   return enabled;
 }
 
+/**
+ * Single toggle to use custom domain for observability export.
+ * When true exporter will send traces to custom Agent365 service endpoint
+ * and include x-ms-tenant-id in headers.
+ */
+export function useCustomDomainForObservability(): boolean {
+  const value = process.env.A365_OBSERVABILITY_USE_CUSTOM_DOMAIN?.toLowerCase() || '';
+  const validValues = ['true', '1', 'yes', 'on'];
+  const enabled = validValues.includes(value);
+  logger.info(`[Agent365Exporter] Use custom domain for observability: ${enabled}`);
+  return enabled;
+}
+
+/**
+ * Resolve the Agent365 service endpoint base URI for a given cluster category.
+ * When an explicit override is not configured, this determines the default base URI.
+ */
+export function resolveAgent365Endpoint(clusterCategory: ClusterCategory): string {
+  switch (clusterCategory) {
+  case 'prod':
+  default:
+    return 'https://agent365.svc.cloud.microsoft';
+  }
+}
+
+/**
+ * Get Agent365 Observability domain override.
+ * Internal development and test clusters can override this by setting the
+ * `A365_OBSERVABILITY_DOMAIN_OVERRIDE` environment variable. When set to a
+ * non-empty value, that value is used as the base URI regardless of cluster category. Otherwise, null is returned.
+ */
+export function getAgent365ObservabilityDomainOverride(): string | null {
+  const override = process.env.A365_OBSERVABILITY_DOMAIN_OVERRIDE;
+
+  if (override && override.trim().length > 0) {
+    // Normalize to avoid double slashes when concatenating paths
+    return override.trim().replace(/\/+$/, '');
+  }
+  return null;
+}
+
 
 /**
  * Parse identity key back to tenant and agent IDs
diff --git a/packages/agents-a365-observability/src/tracing/util.ts b/packages/agents-a365-observability/src/tracing/util.ts
index 7ad10c1..63e2638 100644
--- a/packages/agents-a365-observability/src/tracing/util.ts
+++ b/packages/agents-a365-observability/src/tracing/util.ts
@@ -4,9 +4,13 @@
 // ------------------------------------------------------------------------------
 
 import { OpenTelemetryConstants } from './constants';
-import { ClusterCategory } from '@microsoft/agents-a365-runtime';
+
 /**
- * Check if exporter is enabled via environment variables
+ * Check if exporter is enabled via environment variables.
+ *
+ * NOTE: Exporter-specific helpers have been moved to
+ * tracing/exporter/utils.ts. This file remains only for any
+ * non-exporter tracing utilities that may be added in the future.
  */
 export const isAgent365ExporterEnabled: () => boolean = (): boolean => {
   const enableA365Exporter = process.env[OpenTelemetryConstants.ENABLE_A365_OBSERVABILITY_EXPORTER]?.toLowerCase();
@@ -18,41 +22,3 @@ export const isAgent365ExporterEnabled: () => boolean = (): boolean => {
     enableA365Exporter === 'on'
   );
 };
-
-/**
- * Single toggle to use custom domain for observability export.
- * When true exporter will send traces to custom Agent365 service endpoint
- * and include x-ms-tenant-id in headers.
- */
-export const useCustomDomainForObservability = (): boolean => {
-  const value = process.env.A365_OBSERVABILITY_USE_CUSTOM_DOMAIN?.toLowerCase();
-  return (
-    value === 'true' ||
-    value === '1' ||
-    value === 'yes' ||
-    value === 'on'
-  );
-};
-
-/**
- * Resolve the Agent365 service endpoint base URI for a given cluster category.
- *
- * By default this returns the production Agent365 endpoint. Internal development
- * and test clusters can override this by setting the
- * `A365_OBSERVABILITY_DOMAIN_OVERRIDE` environment variable. When set to a
- * non-empty value, that value is used as the base URI regardless of cluster category.
- */
-export function resolveAgent365Endpoint(clusterCategory: ClusterCategory): string {
-  const override = process.env.A365_OBSERVABILITY_DOMAIN_OVERRIDE;
-
-  if (override && override.trim().length > 0) {
-    // Normalize to avoid double slashes when concatenating paths
-    return override.trim().replace(/\/+$/, '');
-  }
-
-  switch (clusterCategory) {
-  case 'prod':
-  default:
-    return 'https://agent365.svc.cloud.microsoft';
-  }
-}
diff --git a/tests/observability/core/agent365-exporter.test.ts b/tests/observability/core/agent365-exporter.test.ts
index b48186c..befcab5 100644
--- a/tests/observability/core/agent365-exporter.test.ts
+++ b/tests/observability/core/agent365-exporter.test.ts
@@ -134,7 +134,7 @@ describe('Agent365Exporter', () => {
 
   it.each([
     {
-      description: 'set to non-empty value',
+      description: 'set to non-empty value and A365_OBSERVABILITY_USE_CUSTOM_DOMAIN is true',
       override: 'https://custom-observability.internal',
       expectedBaseUrl: 'https://custom-observability.internal'
     },
@@ -152,10 +152,16 @@ describe('Agent365Exporter', () => {
       description: 'unset (undefined)',
       override: undefined,
       expectedBaseUrl: 'https://agent365.svc.cloud.microsoft'
-    }
-  ])('uses correct domain when A365_OBSERVABILITY_DOMAIN_OVERRIDE is $description', async ({ override, expectedBaseUrl }) => {
+    },
+    {
+      description: 'set to non-empty value and A365_OBSERVABILITY_USE_CUSTOM_DOMAIN is false',
+      override: 'https://custom-observability.internal',
+      expectedBaseUrl: 'https://custom-observability.internal',
+      notUseCustomDomain: true
+    },
+  ])('uses correct domain when A365_OBSERVABILITY_DOMAIN_OVERRIDE is $description', async ({ override, expectedBaseUrl, notUseCustomDomain }) => {
     mockFetchSequence([200]);
-    process.env.A365_OBSERVABILITY_USE_CUSTOM_DOMAIN = 'true';
+    process.env.A365_OBSERVABILITY_USE_CUSTOM_DOMAIN = notUseCustomDomain ? 'false' : 'true';
 
     if (override !== undefined) {
       process.env.A365_OBSERVABILITY_DOMAIN_OVERRIDE = override as string;
@@ -184,7 +190,11 @@ describe('Agent365Exporter', () => {
     const headersArg = fetchCalls[0][1].headers as Record<string, string>;
 
     expect(urlArg).toBe(`${expectedBaseUrl}/maven/agent365/agents/${agentId}/traces?api-version=1`);
-    expect(headersArg['x-ms-tenant-id']).toBe(tenantId);
+    if (!notUseCustomDomain) {
+      expect(headersArg['x-ms-tenant-id']).toBe(tenantId);
+    } else {
+      expect(headersArg['x-ms-tenant-id']).toBeUndefined();
+    }
     expect(headersArg['authorization']).toBe(`Bearer ${token}`);
   });