QUIZ 3 January 2020, questions PDF

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Download QUIZ 3 January 2020, questions PDF

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Chapter 1: 1. Are textiles and clothing, and softwood lumber examples of items regulated by the Export Control List? Yes 2. Do goods under the NAFTA need a special certificate of origin? a. Yes, they need a NAFTA certificate origin 3. An exporter wants to export a taxidermied bear to Hong Kong via air freight. What must be the freight forwarder do prior to exportation? a. Verify if an export permit and CITIES permit is required 4. Where would a freight forwarder obtain information on documentary requirements for a destination country? a. Through his company’s agent at destination or Migra’s Canadian Export Guide 5. Which of the following is not one of the purpose of the commercial invoice? a. It certifies the origin of the goods in the shipment 6. What is one of the purpose of the packaging list? a. It helps identify the goods in case of an insurance claim 7. Who issues import permits in Canada? a. Global Affairs Canada 8. Where or with whom is form B13A field? a. Canada Customs and it remains in Canada 9. Can you apply for an export permit if the exporter is not residing in Canada but the goods are of Canadian origin and exported through a Canadian port? a. Yes 10. Which of the following is an inspection certificate required for importations to certain countries? a. Clean Report of Findings

Chapter 2 1. Which of the following is not one of the most common methods of settlement available in international transactions? a. Offer to settle 2. Which of the following methods of international payment settlement would not be advisable or possible to use when the destination country has currency restrictions, requires import permits or quotas or is politically or economically unstable? a. Open account 3. What are the two important documents used in a documentary collection? a. The bank collection form and the bill exchange 4. Under which international payment settlement method could the exporter face the following scenario? The bank acts as a collection agency. The goods will arrive at destination and if the importer cannot pay, the exporter will have to decide if he pays to bring back the goods or try to sell them to another client, possibly at a loss. a. Documentary collections 5. When using documentary collections as the method of payment settlement on an ocean freight shipment, how would you consign the bill of lading?

a. To order blank 6. How do you define a bill of exchange? a. An unconditional order in writing where one party undertakes to pay another party a named sum of money at a given date 7. What is a sight bill of exchange? a. A bank draft payable upon presentation 8. What is a term bill of exchange? a. A bank draft payable at a specified date and accepted by the signature of the drawee. 9. On a bill of exchange, who is the drawee? a. The party that has to pay 10. On a bill of exchange, who is the drawer? a. The party that wants the money 11. In documentary collections, what is meant by “tenor”? a. The time allowed to the importer for payment of an accepted bill of exchange 12. In documentary collections, what is mean by “documents on acceptance”? a. The collecting bank (drawee’s bank) released the transport documents to the drawee, after the drawee has properly accepted a term bill of exchange 13. Which party usually pays the banks’ fees for documentary collections? a. The importer 14. Under documentary collections, why must an air waybill be consigned to a party or a bank? a. Because it is a non-negotiable document

Chapter 3 1. Which of the following would be one of the main reasons why a letter of credit maybe chosen as a form of international payment? a. Foreign exchange issue in the importer’s country 2. Which of the following is one of the main advantages of a letter of credit? a. Credit risk is transferred from importer to issuing bank 3. Which of the following is not one of the parties involved in a letter of credit transaction? a. The confirming bank 4. Letters of credit deal with documents, not goods. What risk does this pose to the importer? a. The exporter not shipping the same goods as mentioned in the letter of credit 5. Which party instructs the bank to open a letter of credit? a. The applicant 6. Which party draws up and issues the letter of credit and then makes payment according to the conditions outlined in the letter of credit? a. The beneficiary 7. Does the advising bank take on any payment obligations to the beneficiary under a letter of credit? a. No 8. What is the current version of the UCP rules used by commercial bankers and commercial parties in the execution of letters of credit? a. UCP 600

9. What is the bank’s role under Article 5 of the UCP 600 rules? a. Banks deal in documents only 10. Is a CIFFA freight forwarder liable for his/her documentation in a letter of credit transaction? a. Yes 11. The UCP 600 rules provide some room for interpretation. What should a CIFFA freight forwarder do if in doubt? a. Contact the bank immediately as it is the bank’s interpretation that counts 12. What date do the banks look for if the credit prescribes an on board bill of lading and a latest shipping date? a. The actual on board or sailing date 13. Under the UCP 600 rules, which date do you use to present the document to the paying bank? a. Whichever date comes first, presentation deadline or expiry 14. Under Article 23 of the UCP 600 rules, is a house air waybill acceptance? a. No 15. Is it possible to assign to another party all or part of the proceeds of a drawing/payment under a credit? a. Yes 16. What is one of the risks the exporter is exposed to under the usance letter of credit? a. The commercial risk of the issuing bank Chapter 4 1. What is palletizing or unitizing cargo? a. Assembling packages and securing them to a pallet base 2. What is the most common economical container/package? 3. What is the main problem with using wood packaging when shipping items internationally? 4. When loading an ocean or air freight container, with respect to the final destination, what should the freight forwarder consider? 5. Which of the following is one of the necessary things to do when transporting cargo containing hazardous goods? 6. To prevent damage or loss during a journey, when packing and loading a shipping container, which of the following should be the first rule to consider?

Chapter 5 1. What is described as a full disclosure of all material facts to the insurance underwriter? a. Utmost good faith 2. What is one of the features of the term insurable interest? a. There must be an object exposed to an insurable risk 3. What document acts as the contract between the insurer and the insured and provides details of insurance coverage as well as transportation details and particulars of the shipment? a. Insurance certificate 4. Which of the following losses may be excluded in an insurance policy? a. Losses by inherent vice 5. What type of coverage does Free of Particular Average (FPA), Clause “C” provide?

a. Minimum coverage 6. Risk of war, strikes, civil commotion and mines are usually excluded in marine cargo policies. How can coverage be obtained? a. With an express warranty written into the insurance certificate 7. Can war risks be covered when cargo is on land? a. Only if an agreement related to war risk is obtained with the insurance company 8. What is described as property within cargo, which causes, or is liable to cause, loss or damage to the cargo without any insurable peril occurring, e.g., cargo which may spontaneously combust, or fruit which may spoil over time? a. Inherent vice 9. There are three essential ingredients when declaring a general average – two of them are as follows: a common adventure and the expense sacrifice must be extraordinary in nature. What is the third ingredient? a. The voyage must come to a safe end, part of the cargo is sacrificed in order to save the rest 10. When general average has been declared for a vessel arriving at an ocean port, what will an average adjuster require from a freight forwarder, if insurance is in place, before cargo is released to him? a. An unlimited document relating to the cargo 11. When general average has been declared for a vessel arriving at an ocean port, what will an average adjuster require from a freight forwarder, if insurance is not in place, before cargo is released to him? a. A cash deposit for the share of the estimated average loss

Chapter 6 1. What is the name of the regulations on international maritime security? 2. What is the name of Canada’s security program that helps reduce contraband, smuggling, and terrorism? 3. What government agency administer the PIP program? a. CBSA Canada Border Services Agency 4. What is one of the issues the Memoranda of Understanding in the PIP program focus on? 5. Which program in the U.S. is similar to the Canadian PIP program? a. Customs-Trade Partnership Against Terrorism 6. Which of the following is one of the two government agencies that administer the CustomsTrade Partnership Against Terrorism program? 7. Which initiative is designed to ensure electronic transmission of data before goods and conveyances arrive in place of destination and implements tools to detect high-risk shipments ensuring low-risk shipments can be cleared faster? a. Advance Commercial Information 8. In compliance with the ACI initiative, what is the mandatory reporting time frame for air exports? a. Not less than 2 hours before being loaded on the aircraft

9. In compliance with the ACI initiative, what is the mandatory reporting time frame for marine imports of containerized cargo loaded in a country other than the U.S.? a. 24 hours before loading 10. What U.S. security initiative applies to maritime transportation? 11. In addition to Montreal and Vancouver, which other Canadian port is part of the Container Security Initiative? a. Halifax 12. What must a Canadian freight forwarder sign to become part of the Transport Canada Air Cargo Security Program? 13. What is the Canadian set of dangerous goods regulations? a. Canadian Transportation of Dangerous Goods Regulations 14. What is the U.S. set of dangerous goods regulations? a. Title 49 of the Code of Federal Regulations 15. Which of the following activities, with respect to dangerous goods, applies to shipper, exporter, importer but doesn’t apply to the carrier? 16. Which of the following is one of the two main responsibilities the freight forwarder has regarding dangerous goods? 17. In Canada, how long is the air dangerous goods training certificate valid for? a. 24 months 18. In Canada, how long is the ocean dangerous goods training certificate valid for? a. 36 months 19. In Canada, how long is the ground dangerous goods training certificate valid for? 20. In Canada, are there any situations when a dangerous goods training certificate would not be valid prior to its expiration? a. Yes (if the regulations applicable to the person’s duties change before the retraining certificate expires) 21. In Canada, in addition to the employer who else must sign the dangerous goods training certificate to make it valid? 22. Who has the responsibility to recognize and identify dangerous goods in a shipment? 23. One of the ways to identify dangerous goods is by their proper shipping name. what is the other way to identify dangerous goods? 24. Who is responsible to complete the documents used for dangerous goods shipments? 25. If found guilty, what penalty could the responsible person be subject to under the TDGR for each subsequent offence?

Chapter 7 1. Prior to offering an alternative to a client, and after assessing the information that the client has provided, what other important element must the freight forwarder take into account? 2....