40. The government agency responsible for determining the dutiable status of goods is:
a. U.S. Commerce Service.
b. U.S. Duties & Tax Service.
c. U.S. Port of Entry Service.
d. None of the above.
41. The customs service may seize articles imported into the U.S. that violate trademark or copyright laws of a U.S.
firm but the mark must be registered with the:
a. U.S. Bureau of Customs and Border Protection.
b. U.S. Patent & Trademark Office.
c. A and B.
d. The Bureau of Customs and Border Protection does not seize items with this type of violation.
42. A binding ruling, issued by the U.S. Bureau of Customs and Border Protection, is issued with regard to:
a. Penalties imposed for non-payment of duties owed.
b. Advance determination of the dutiable status of goods.
c. Seizure of goods not allowed for import to U.S.
d. All of the above.
43. Liquidation of goods by the U.S. Bureau of Customs and Border Protection refers to:
a. The assessment of applicable duties.
b. Disposal of seized goods.
c. Confiscation of goods not allowed for import to U.S.
d. Sale of unclaimed goods.
44. A protest of entry is filed by the importer against the Customs Service when:
a. A dispute arises regarding liquidation.
b. A dispute arises regarding the port at which the goods were received.
c. The importer wishes to refuse delivery and possession of the goods.
d. All of the above.
45. Judicial review of a protest of entry is heard in which of the following courts:
a. Federal Trade Court.
b. Court of International Trade.
c. Circuit Court of Customs Appeals.
d. All of the above depending on the level of review.
46. Where there are two possible classifications for goods, which is followed (in which order):
a. The latest heading that occurs in the schedule; essential character of the goods; their relative specificity.
b. Essential character of the goods; relative specificity; the latest heading that occurs in the schedule.
c. Relative specificity; the latest heading that occurs in the schedule; essential character of the goods.
d. Relative specificity; essential character of the goods; the latest heading that occurs in the schedule.
47. The principal use of an article refers to:
a. The purpose for which it is to be imported.
b. The use that is greater than any other single use of the article.
c. The use of the components once they are fully assembled.
d. Any one of the above.
48. The dutiable value of imported goods includes the price actually paid or payable when sold for exportation plus all of
the following items if not included in the purchase price, with the exception of:
a. Royalty paid by the buyer as a condition of sale.
b. Proceeds from the resale of the goods that accrues to the seller.
c. Selling commission incurred by the buyer.
d. Export fees paid by the seller.
49. Dutiable assists generally include all but which of the following:
a. Raw materials provided by the importer and used in the foreign production of the imported goods.
b. Tools, dies, and molds provided by the importer to the foreign manufacturer of imported goods.
c. Engineering, development. and artwork performed by a foreign firm.
d. All of the above are dutiable assists.
50. All of the following indicate that a product has been substantially transformed except:
a. the product has a new name, character or use.
b. the product has been advanced in value.
c. the product underwent a change in tariff classification.
d. the product has been manufactured in one country and shipped to an intermediary country before coming to
the U.S.
51. Country-of-origin information impacts all of the following except:
a. The applicability of a countervailing duty.
b. The applicability of a quota.
c. The tariff classification of the article.
d. The rate of duty on an import.
52. Goods may be refused entry into the U.S. by the Bureau of Customs and Border Protection due to:
a. Quarantine to protect the public health.
b. Embargoed country of origin.
c. Lack of a commercial invoice.
d. All of the above.
53. A 99% refund of duties and taxes paid on merchandise that is imported, subjected to manufacture or production, and
then exported within five years is called a:
a. Manufacturing drawback.
b. Substitution drawback.
c. Same condition drawback.
d. Re–export drawback.
54. Goods re–exported without having been significantly altered after being imported are subject to a refund of duties
paid known as a:
a. Manufacturing drawback.
b. Substitution drawback.
c. Same condition drawback.
d. Non-transformation drawback.
55. Which of the following combinations of drawbacks are not applicable?
a. Same condition and manufacturing.
b. Manufacturing and substitution.
c. Substitution and same condition.
d. Any of the above combinations could occur.
56. American exports returned to the U.S. are dutiable except when:
a. American-made goods are returned to the U.S. not substantially transformed.
b. Component parts that were made in the U.S. and assembled in a foreign country.
c. Articles exported for repair or alteration but not substantial transformation.
d. All of the conditions above exempt the goods from duties.
57. A country designated as a beneficiary developing country is granted trade preferences for goods entering the U.S.
market provided they meet all of the following conditions except:
a. It is located in Asia.
b. It cooperates with the U.S. in the enforcement of narcotics laws.
c. It has not unlawfully expropriated the property of U.S. citizens.
d. It is not controlled by a communist government.
58. The U.S. law granting trade preferences to imports from the island nations of the Caribbean and Central America is
called:
a. The Caribbean GSP Act.
b. The Latin American Free Trade Act.
c. The Lome Convention.
d. The Caribbean Basin Economic Recovery Act.
59. U.S. Customs regulations specify many articles that are exempt from marking requirements. Some of these are:
a. Eggs, flowers, nuts, and bolts.
b. Products that cannot be marked without injury.
c. Products originating in Canada or Mexico.
d. A, B, and C.
e. A and B only.
60. Which of the following is not a function of the U.S. Bureau of Customs and Border Protection?
a. Assessing and collecting tariff revenue.
b. Regulating the entry of products under quota.
c. Ensuring importer compliance with the Incoterms.
d. Supervising exports.
61. Which of the following are not allowed to enter goods into the customs territory of the United States?
a. The purchaser of the goods.
b. A customs broker authorized to act on behalf of the importer.
c. Nonresident individuals and foreign corporations.
d. All of the above may enter goods.
62. Customs is barred from bringing a civil action to collect an import duty after
a. Three years
b. One year
c. Five years
d. Four years
63. In determining the description of an article under the tariff schedules by the courts
a. Common meaning
b. WTO definitions
c. Scientific authorities and expert witnesses
d. a and c
64. Compare and contrast the different types of tariffs, considering which type would generally benefit the importing
country.
65. In what ways might valuation methods implicate dumping and dumping remedies? Subsidies?
66. Compare and contrast the different methods for assigning value. Consider who might favor which methods and why.
67. Weigh the relative benefits and detriments of a unified customs protocol that would classify all goods.
68. Comparing the U.S. and the EU, in what ways are U.S. businesses at a disadvantage in customs
valuations/assessment of duties? In what ways are EU businesses?
69. Contrast the traditional “name, character, and use” test with that used presently.
70. What are the differences and similarities between the substantial transformation and the value-added test? What
categories of countries are likely to favor which?
71. In what ways do the rules regarding textiles and apparel differ from other rules regarding customs classification and
valuation? In what ways do they resemble such rules? Consider the underlying justifications.
72. Compare and contrast the way that textiles are treated under NAFTA with the way that they are treated under the
WTO. What justifies these different choices?
73. What types of articles do and do not require marks defining place of origin? What justifies these differences?
74. Compare and contrast GSP status with normal trade relations status.
75. Describe the differences, similarities, and resulting penalties or ameliorative mechanisms pertaining to intentionally
false material statements, grossly negligent statements, fraud, and negligent statements on customs documents.
76. Recalling the chicken and egg scenario, design a plan to get a different ultimate product (or forbidden product) into
your country. The focus here is not whether the plan is impervious to attack, but whether it exhibits a potential to
work.
77. Develop a draft of WTO rules regarding origin of goods (or looking at developments in this field, critique such
existing proposals).
Essay
78. California Agricultural Aircraft Services, Inc. (CAAS) is a California corporation headquartered in Sacramento.
CAAS leases aircraft to crop dusting businesses through California. On October 6, 2006, CAAS entered into a
contract with Jinshan Export Company (JEC), a private Chinese enterprise engaged in the businesses of export
facilitation and sales agency, and Shànghai Aircraft Company (SAC), a state-owned enterprise organized pursuant to
the laws of the People’s Republic of China. The contract provided for the manufacture by SAC and purchase by
CAAS of ten crop dusting aircraft at a price of U.S. $2.1 million, a savings of approximately $200,000 compared to
crop dusting aircraft available from other manufacturers. In order to avoid problems arising from the sale of Chinese
aircraft in the United States, JEC and SAC agreed to fabricate the aircraft parts at SAC’s Chinese manufacturing
facility but perform the actual assembly at its facility in Mexico. SAC would then export the aircraft to CAAS
claiming they were products of Mexico subject to duty–free treatment pursuant to the North American Free Trade
Agreement. Unfortunately, U.S. Customs classified the aircraft as products of China, denied the request for duty-
free treatment pursuant to NAFTA and assessed the applicable tariff on aircraft originating from China. How will
U.S. Customs Service and Border Protection determine the country of origin of the aircraft? What factors may
Customs utilize in making this determination? Applying these factors to the above-stated facts, are the aircraft
products of China or Mexico? Applying these factors, are JEC, SAC and CAAS likely to prevail if they challenge
Customs’ decision?