Supply Chain and Logistics Global Logistics and Trade Compliance 2

Question 1

What is the C-TPAT program?

Accepted Answer

Customs-Trade Partnership Against Terrorism — a US CBP supply chain security program

Answer

C-TPAT is a voluntary US CBP partnership program where businesses adopt supply chain security standards in exchange for expedited customs processing.

Question 2

What is a letter of credit (LC) in international trade?

Accepted Answer

A bank-issued payment guarantee that ensures sellers are paid when they meet specified documentary conditions

Answer

A letter of credit is a financial instrument issued by a buyer's bank guaranteeing payment to the seller upon presentation of compliant shipping documents.

Question 3

What does the US Customs drawback program allow importers to do?

Accepted Answer

Recover duties paid on imported goods that are subsequently exported or used in exported products

Answer

Customs drawback allows businesses to claim refunds of up to 99% of duties paid on imported materials that are later exported.

Question 4

What is INCOTERMS 2020?

Accepted Answer

Internationally recognized trade terms published by the ICC that define buyer and seller responsibilities in international transactions

Answer

Incoterms 2020 are 11 standardized ICC rules defining cost, risk, and responsibility split between buyers and sellers in international contracts.

Question 5

What is ocean freight demurrage and detention in international shipping?

Accepted Answer

Demurrage is charged for holding containers at the port; detention is charged for holding containers off-port beyond free time

Answer

Demurrage applies when containers remain at the port terminal past free days; detention applies when containers are held outside the port at importers' or exporters' facilities.

Supply Chain and Logistics Practice Test

Supply Chain and Logistics Practice Test

Supply Chain and Logistics Global Logistics and Trade Compliance 2