Friday, September 18, 2009

Customs Broker Exam Study Tip 11: Free Trade Agreements

With the increase of free trade agreements between the U.S. and other countries, the number of questions on the CBE related to these agreements has increased. In fact, “Trade Agreements” often has its very own section of questions on the exam. Free Trade Agreements (FTAs) are international agreements made between two or more nations that relate to common trade or service issues. FTA’s reduce or eliminate all tariffs and other restrictions on substantially all the trade in goods between its member countries based on country of origin.

The information needed to answer questions about FTA’s is likely to be found in one of four places, the General Notes of the HTSUS, Chapters 98 an 99 of the HTSUS, 19 CFR Part 10 and 19 CFR Part 181. Memorize the titles of these General Notes and skim the text to become familiar with the topics covered in each. In your review of the programs, concentrate on the basic requirements such as tariff shift, de minimis and RVC requirements. Each program has different requirements regarding allowance of the special duty treatment, and some of these programs are subject to change. Most of these programs have very detailed requirements that must be met in order to claim the duty-free status. Additionally, these programs are often difficult to understand, and some have limited use in daily practice. Try not to be too overwhelmed when encountering these problems. If they appear too difficult, move and come back to them later.

Don’t overlook important terminology. Be sure to know the definitions for each of the following:

· Accumulation
· Direct Cost of Processing
· De Minimis
· Imported Directly
· Transshipment
· Regional Value Content RVC
· Tariff Shift
· Substantial Transformation

To view a list of the FTAs, the references to the HTSUS General Notes, SPI and CFR references, click
HERE.

We welcome your comments on these suggestions and encourage you to add your own ideas to this forum so that other students studying for the exam can benefit from your experiences. Check the Boskage Trade News regularly for more helpful hints on studying for the Customs Broker Exam and other useful news for international trade professionals!

1 comment:

Trade-Agreements.info said...

Thanks for the tips, Wizard! Keep 'em coming. It's never easy to keep up with the complex requirements of trade agreements.