AEO Customs Procedures & Risk Management 4

Question 1

Which U.S. law introduced the 'informed compliance' and 'reasonable care' obligations for importers?

Accepted Answer

Customs Modernization Act of 1993 (Mod Act)

Answer

The Mod Act shifted responsibility to importers to use reasonable care in classification, valuation and entry.

Question 2

Under 19 CFR Part 163, how long must importers generally retain entry records?

Accepted Answer

5 years from the date of entry

Answer

Most import records must be kept for five years from the date of entry.

Question 3

In a U.S. Foreign-Trade Zone (FTZ), when are customs duties generally paid?

Accepted Answer

When goods leave the zone and enter U.S. commerce

Answer

Duty is owed only when merchandise is entered for consumption into U.S. commerce; re-exports from the zone avoid duty.

Question 4

An 'inverted tariff' benefit in an FTZ allows a manufacturer to do what?

Accepted Answer

Pay duty at the lower rate of the finished product instead of the higher rate on components

Answer

When the finished product carries a lower duty than its inputs, the FTZ user may elect the finished-product rate.

Question 5

U.S. duty drawback allows a refund of up to what percentage of duties paid on imported goods later exported or destroyed?

Accepted Answer

99%

Answer

Drawback refunds up to 99% of eligible duties, taxes and fees.

AEO - Authorized Economic Operator Certification Practice Test