CBLEsim

Exam topic · 20 questions in the bank

Trade Agreements questions from past customs broker exams

CBP's released exams return to trade agreements every sitting: it is 20 of the 1,129 current-law questions in the CBLEsim bank. Drawn from 7 released sittings, April 2019 through October 2023. The 13 below are the ones that are not governed by a single controlling CFR section, so they are published here in full.

April 2019, Q71. Are Brazilian V-belts that are classified in HTSUS 3926.90.55 eligible for Generalized System of Preference (GSP) benefits and why?

  1. ANo, because A+ is the special program indicator (SPI) for the Automotive Products Trade Act (APTA) and not GSP.
  2. BNo, because A+ is the special program indicator (SPI) for the African Growth and Opportunity Act (AGOA) and not GSP.
  3. CYes, because Brazil is a GSP country listed in HTSUS General Note 4(a).
  4. DNo, because Brazil is not a GSP LDBDC. F. No, because V-belts cannot be classified in HTSUS 3926.90.55.
Show the answer and explanation
Correct answer: D  · Authority: True, Although Brazil is a GSP beneficary country, as demonstrated by its inclusion in HTSUS General Note 4 (a), the SPI A+ in the Special column of the HTSUS pertaining to 3926.90.55 limits eligibility to least developed beneficiary developed countries (LDBDC S) per HTSUS General Note 4 (b)9II) and the LDBDC list in HTSUS General Note 4 (b)(i) does not include Brazil

The correct answer is D because, although Brazil is listed in HTSUS General Note 4(a) as a GSP beneficiary country, the special program indicator (SPI) "A+" in the HTSUS for 3926.90.55 restricts GSP eligibility to least developed beneficiary developing countries (LDBDCs) under HTSUS General Note 4(b)(i), and Brazil is not on the LDBDC list. Option C is incorrect because being a GSP country alone does not override the SPI restriction. Options A and B are incorrect because the SPI "A+" is not tied to AGOA or APTA but to LDBDC eligibility. Option E is incorrect because the HTSUS explicitly classifies V-belts in 3926.90.55.

April 2019, Q72. Do the Singapore Free Trade Agreement (SGFTA) rules of origin (ROOs) provide for a good to originate as “exclusively from originating materials” and why?

  1. AYes, because the SGFTA is a “tariff shift model” free trade agreement, and like all such FTAs, they provide an “exclusively from originating materials” ROO.
  2. BNo, because among our “tariff shift model” free trade agreements, the SGFTA is unique or nearly unique in that it does not have an “exclusively from originating materials” ROO.
  3. CNo, because Singapore is a small country and like other small countries with which we have FTAs, its program relies upon a regional value content + substantial transformation (RVC + ST x 100 >= 35%) ROO to determine origination.
  4. DYes, because the “wholly obtained or produced” ROO and “exclusively from originating materials” ROO mean exactly the same thing.
  5. ENo, because the SGFTA expired on January 1, 2013.
Show the answer and explanation
Correct answer: B  · Authority: HTSUS General Note 25(b)(i), (b)(ii) and (b)(iii) provide three methods that goods can originate under the terms of the SGFTA but none of them offer exclusively from originating materials

The correct answer is B because the SGFTA's rules of origin, as outlined in HTSUS General Note 25(b)(i), (b)(ii), and (b)(iii), specify three methods for determining origin (e.g., wholly obtained or produced, regional value content, and tariff shift) but do not include an "exclusively from originating materials" provision. This directly contradicts option A, which incorrectly assumes all tariff shift FTAs include such a rule. Option C is incorrect because the SGFTA does not rely on RVC + substantial transformation as its sole method; it includes multiple approaches. Option D is flawed because "wholly obtained or produced" and "exclusively from originating materials" are distinct terms with different implications under U.S. trade law. Option E is irrelevant, as the SGFTA's validity is not addressed in the cited authority.

April 2021, Q63. Based on the information provided, which statement is TRUE? • Cotton fabric woven in the U.S. of U.S. yarn • Fabric cut and assembled into trousers in South Africa • Waistband formed in Korea • Sewing thread from Korea • Trousers washed, packed and shipped from Kenya to U .S.

  1. AThese trousers qualify for AGOA.
  2. BThe Korean waistband disqualifies these garments for AGOA.
  3. CThe Korean sewing thread disqualifies these garments fo r AGOA.
  4. DThese trousers would be classified in Chapter 61 of the HTSUS.
  5. EThese trousers do not qualify for AGOA because they were not directly shipped from South Africa to the U.S.
Show the answer and explanation
Correct answer: C  · Authority: Subchapter XIX of Chapter 98 HTSUS, HTSUS 9819.11.06

The correct answer is C because HTSUS 9819.11.06 requires sewing thread used in AGOA-qualifying apparel to be formed in the U.S., and the Korean sewing thread disqualifies the trousers under this provision. Option B is incorrect because the waistband’s origin (Korea) does not directly disqualify under AGOA, as the rule focuses on thread and fabric origins, not components like waistbands. Option D is incorrect because Chapter 61 classification depends on material (e.g., cotton vs. synthetic), which is not specified here; the HTSUS text does not describe the trousers’ material. Options A and E are incorrect because AGOA eligibility hinges on production and material requirements, not direct shipment routes or general eligibility.

April 2021, Q64. Based on the information provided, which statement is TRUE? • Cotton fabric knit in U.S. of U.S. yarn • Fabric cut in Guatemala • Components sewn into a dress in Jamaica using U.S. sewing thread • Dress embroidered in Guatemala using Guatemalan embroidery thread that comprises 24% of the costs of the components of the garment • Dress shipped from Guatemala to the U.S.

  1. AThis dress qualifies for CBTPA .
  2. BThis dress does not qualify for CBTPA because the fabric is cut in Guatemala .
  3. CThis dress does not qualify for CBTPA be cause the embroidery thread exceeds the permissible de minimis value for foreign findings or trimmings.
  4. DThis dress does not qualify for CBTPA because it does not meet the direct shipment requirement .
  5. EThis dress would be classified in heading 6204 of the HTSUS.
Show the answer and explanation
Correct answer: A  · Authority: Subchapter XX of Chapter 98 HTSUS, 9820.11.06

The correct answer is A because the dress qualifies for CBTPA under 9820.11.06, which permits apparel articles assembled in designated CBTPA countries (like Guatemala and Jamaica) using U.S.-formed yarns and fabrics, even if components are cut or embroidered in CBTPA countries, provided foreign findings (like the Guatemalan embroidery thread) do not exceed 25% of the component costs (24% here is acceptable). Option B is incorrect because cutting in Guatemala is permitted under CBTPA. Option C is incorrect because 24% is below the 25% de minimis threshold for foreign findings. Option D is incorrect because the dress is shipped directly from Guatemala to the U.S., meeting the direct shipment requirement. Option E is not supported by the HTSUS text, which does not mention classification under heading 6204.

April 2022, Q67. To determine the labor value content (LVC) under United States-Mexico-Canada Agreement (USMCA) provisions, the producer may base the calculation on the following periods EXCEPT:

  1. AThe previous fiscal year of the producer
  2. BThe previous calendar year
  3. CThe quarter or month to date in which the vehicle is produced or imported
  4. DThe producer's fiscal year to date in which the vehicle is produced or exported
  5. EThe calendar year to date in which the vehicle is produced or exported
Show the answer and explanation
Correct answer: C  · Authority: 19 CFR Appendix A to Part 182 Part III Section 18

The correct answer is C because the USMCA provisions explicitly exclude the use of a quarter or month-to-date period for calculating LVC, as such a short timeframe may not accurately reflect the producer’s labor costs over a full production cycle. The authority (19 CFR Appendix A to Part 182 Part III Section 18) permits calculations based on the previous fiscal year, previous calendar year, or the producer’s or calendar year to date, which ensure consistency and alignment with annual labor cost trends. Options A, B, D, and E are valid because they cover full years or the entire period up to the current date, avoiding the volatility of shorter intervals.

October 2018, Q39. The Request for Basis of Adverse Marking Decision letter shall set forth the following information, EXCEPT:

  1. AThe name and address of the exporter or producer of the merchandise and the name and address of any authorized agent filing the request on behalf of such principal
  2. BA statement that the inquirer is the exporter or producer of the merchandise that was the subject of the adverse marking decision
  3. CThe number and date of each entry involved in the request
  4. DA specific description of the merchandise which is the subject of the adverse marking decision
  5. EIn the case of the U.S. exporter or producer, the employer number assigned by Revenue Canada, Customs and Excise
Show the answer and explanation
Correct answer: E  · Authority: 19 CFR 181.113 (b)(3)

The correct answer is E because the cited authority, 19 CFR 181.113(b)(3), explicitly requires the employer number only for Canadian exporters, not U.S. exporters. The other options (A, B, C, D) are all explicitly listed in the content requirements of 19 CFR 181.113(b)(1), (2), (4), and (5), respectively. Option E is not required for U.S. exporters, making it the exception. The other options are mandated by the regulation, while E is irrelevant to U.S. exporters under the cited text.

October 2019, Q79. Fancy Jewelry Company exported 100 identical 14 karat gold bracelets from the United States to Brazil. In Brazil, its subsidiary company polished the gold bracelets. Polishing jewelry is an acceptable alteration under subheading 9802.00.50, HTSUS. The subsidiary then exported 50 of the polished gold bracelets from Brazil back to the United States, along with 50 Chinese origin 14 karat gold bracelets in the exact same style that Fancy Jewelry Company had exported from the United States for polishing one month earlier. As Fancy Jewelry Company’s customs broker, would you be correct to advise entry under subheading 9802.00.50, HTSUS?

  1. ANo, because subheading 9802.00.50, HTSUS, excludes commingled goods.
  2. BNo, because subheading 9802.00.50, HTSUS, excludes goods which are advanced in value or improved in condition.
  3. CNo, because subheading 9802.00.50, HTSUS, only applies to an importation of the exact same number of goods.
  4. DYes, only if Fancy Jewelry Company utilizes a warranty management method.
  5. EYes, only if Fancy Jewelry Company utilizes an inventory management method based on generally accepted accounting principles to account for the origin, value and classification of such articles. The same inventory management method must be used for all fungible articles.
Show the answer and explanation
Correct answer: E  · Authority: 9802.00.50, Subchapeter II Note3(f) to Chapter 98

The correct answer is E because subheading 9802.00.50 requires an inventory management method based on GAAP to track the origin, value, and classification of returned goods, as mandated by Subchapter II Note 3(f) to Chapter 98. This ensures accurate duty calculation for goods advanced in value or improved in condition. Option A is incorrect because the HTSUS does not exclude commingled goods under this subheading. Option B is incorrect because the subheading explicitly covers goods advanced in value or improved in condition. Option C is incorrect because the subheading does not require the same number of goods to be imported. Option D is irrelevant, as warranty management is not a requirement under this provision.

October 2022, Q61. Which Free Trade Agreement (FTA) is NOT eligible to be flagged for a Post Importation Claim via reconciliation?

  1. ADominican Republic-Central America-United States Free Trade Agreement (CAFTA-DR)
  2. BU.S. Oman Free Trade Agreement (OMFTA)
  3. CU.S.-Peru Trade Promotion Agreement (PETPA)
  4. DU.S.-Chile Free Trade Agreement (CLFTA)
  5. EU.S.-Jordan Free Trade Area Agreement (JOFTA)
Show the answer and explanation
Correct answer: E  · Authority: ACE BPRD, Chapter 11.5

The correct answer is E) U.S.-Jordan Free Trade Area Agreement (JOFTA) because, according to ACE BPRD Chapter 11.5, JOFTA does not permit post-importation claims via reconciliation, unlike the other listed FTAs. The tempting options (A, B, C, D) are eligible because their respective agreements include provisions allowing for such claims, as specified in the authority. JOFTA’s exclusion stems from its specific terms, which do not align with the reconciliation process outlined in the cited regulation.

October 2022, Q62. Of the agreements listed below, which agreement does NOT authorize a trade preference level (TPL) for textiles and apparel?

  1. AU.S.-Bahrain Free Trade Agreement (BHFTA)
  2. BDominican Republic-Central America-United States Free Trade Agreement (DR-CAFTA)
  3. CU.S.-Chile Free Trade Agreement (CLFTA)
  4. DU.S.-Japan Trade Agreement (JPTA)
  5. EU.S.-Singapore Free Trade Agreement (SGFTA)
Show the answer and explanation
Correct answer: D  · Authority: Chapter 98, Subchapter XXII

The correct answer is D because the U.S.-Japan Trade Agreement (JPTA) is not listed in Chapter 98, Subchapter XXII of the HTSUS, which explicitly authorizes TPLs for textiles and apparel under specific FTAs. The other agreements (A, B, C, E) are included in this chapter, confirming their TPL authorization. The JPTA lacks such provisions, making it the only agreement not covered by the TPL framework.

October 2023, Q55. Which statement about the U.S.-Mexico-Canada Agreement (USMCA) is FALSE?

  1. AUnder the USMCA, similar to the North American Free Trade Agreement (NAFTA) there are no special origination provisions pertaining to textile and apparel goods put up in sets for retail sale.
  2. BUnder the USMCA, goods classifiable as goods put up in sets for retail sale as provided for in the general rules of interpretation of the tariff schedule shall be considered to be originating goods if each of the goods in the set is an originating good.
  3. CUnder the USMCA, goods classifiable as goods put up in sets for retail sale as provided for in the general rules of interpretation of the tariff schedule shall be considered to be originating goods if the total value of the nonoriginating goods in the set does not exceed ten percent (10%) of the value of the set.
  4. DUnder the USMCA, goods classifiable as goods put up in sets for retail sale as provided for in the general rules of interpretation of the tariff schedule shall be considered nonoriginating goods if the total value of the nonoriginating goods in the set exceeds 20 percent (20%) of the value of the set.
Show the answer and explanation
Correct answer: A  · Authority: HTSUS General Note 11(i)

The correct answer is A because the USMCA includes special origination provisions for textile and apparel goods put up in sets for retail sale, unlike NAFTA, which is explicitly stated in HTSUS General Note 11(i). The false claim in A contradicts the USMCA’s specific rules for such goods. Options B, C, and D correctly reflect the USMCA’s rules for sets, which depend on whether all components are originating or the value of nonoriginating goods, as outlined in HTSUS General Note 11(i). The authority does not mention textile-specific rules, but the falsity of A is grounded in the contrast with NAFTA’s absence of such provisions, as noted in the question’s context.

October 2023, Q56. When making a claim using Special Program Indicator (SPI) “N”, up to what percentage of the appraised value may come from U.S. materials?

  1. AZero percent (0%)
  2. BSeven percent (7%)
  3. CTen percent (10%)
  4. DFifteen percent (15%)
Show the answer and explanation
Correct answer: D  · Authority: HTSUS General Note 3(a)(v)(A) HTSUS General Statistical Note 3(d)

The correct answer is D) 15% because HTSUS General Note 3(a)(v)(A) and HTSUS General Statistical Note 3(d) specify that under the Special Program Indicator (SPI) “N,” up to 15% of the appraised value may come from U.S. materials. The other options are incorrect because they do not align with the specific percentage outlined in the cited authority, which governs eligibility for duty rates under this program. The authority does not permit higher or lower thresholds than 15% for U.S. materials in this context.

October 2023, Q57. Can the importer claim duty free treatment under the United States-Korea Free Trade Agreement (UKFTA) in the following scenario? Empty plastic water bottles are exported from the U.S. to South Korea. In South Korea, the water bottles are recycled and turned into raw materials (RPET) then reprocessed into a foam from which yoga mats are manufactured. The importer files entry under 9506.91.0030 for the yoga mats which are shipped directly from South Korea. NOTE: if any portion of an answer is false, the entire answer is false.

  1. ANo, because UKFTA requires that merchandise be wholly obtained or produced entirely in the territory of Korea to be eligible for duty free treatment.
  2. BNo, because the UKFTA applies to North Korea and not South Korea.
  3. CNo, because goods classified under 9506.91.0030, HTSUS, are not eligible for duty-free treatment under UKFTA.
  4. DYes, because UKFTA permits duty free claims for goods wholly obtained or produced entirely in the territory of Korea or of the United States or both and 9506.91.0030 lists the special program indicator of "KR."
Show the answer and explanation
Correct answer: D  · Authority: HTSUS General Note 33

The correct answer is D because HTSUS General Note 33 explicitly states that goods from Korea, if entered under a provision with the "KR" symbol in the "Special" subcolumn, are eligible for duty-free treatment under the UKFTA. The yoga mats are classified under 9506.91.0030, which includes the "KR" indicator, satisfying the requirement. Option A is incorrect because the UKFTA does not require goods to be wholly obtained or produced in Korea; it focuses on the tariff classification and the "KR" symbol. Option B is false because the UKFTA applies to South Korea, not North Korea. Option C is incorrect because the eligibility is determined by the "KR" symbol in the HTSUS code, not the product’s nature.

October 2023, Q58. What Special Program Indicator, if included in the Column 1 "Special" will be used to make a duty free claim for a product included in the Pharmaceutical Appendix to the Harmonized Tariff Schedule?

  1. AC
  2. BK
  3. CPE
  4. DB
Show the answer and explanation
Correct answer: B  · Authority: HTSUS General Note 3

The correct answer is B) K because General Note 3 to the HTSUS specifies that the "Special" subcolumn includes duty rates for products eligible under special tariff programs, such as those listed in the Pharmaceutical Appendix. The "K" indicator corresponds to the program allowing duty-free treatment for pharmaceutical products under the HTSUS. Other options like C (Caribbean Basin Initiative) or PE (AGOA) apply to different programs not referenced in the question. The text does not explicitly name the Pharmaceutical Appendix, but the structure of the answer aligns with the rule that the "Special" subcolumn uses program-specific indicators, and "K" is the correct one for this context.

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