Terms 1
Tax levied on goods by the country of importation.
Tariff
Quantitative restriction on imports.
Quota
Shirts are imported but they are defective because the buttonholes are sewn closed. The shirts are returned to U.S. Customs within three years and either destroyed or reexported. A drawback is allowed as a:
a. manufacturing drawback.
b. same-condition drawback.
c. substitution drawback.
d. rejected merchandise drawback.
d. rejected merchandise drawback.
Which of the following is an example of a sanction:
a. seizure of property.
b. block bank accounts.
c. travel ban.
d. all of the above.
d. all of the above.
Provide at least 3 reasons for regulating imports.
Revenue
Protection of domestic industry
Retaliation against foreign trade barriers
Protection of resources
Where the product comes from.
Country of origin
Shipping goods into a country.
Importing
Under the WTO's dispute-settlement procedures, who can bring a complaint for nullification and impairment?
a. A corporation
b. A government
c. A group of corporations within an industry
d. All of these are correct
b. A government
WTO Dispute-Settlement Procedures
Dispute mechanisms and procedures attempt to avoid retaliation or “trade wars”
Have quasi-judicial process for resolving disputes when deadlocked
Only a government can bring a “complaint” against another government
Indirect non-tariff barriers could include all of the following EXCEPT:
a. laws.
b. regulations.
c. rules of administrative agencies.
d. quotas.
d. quotas.
Direct Non-tariff Barriers
Embargoes
Quotas
Rates of duty :
General rate
Special rate of duty
Original rates form Smoot-Hawley Tariff Act of 1930
Maximum rate of duty (tariff) that can be imposed by the importing country on an imported commodity.
Bound rate
A law that prevents citizens or companies from participating in a boycott.
Antiboycott
A binding ruling, issued by the U.S. Bureau of Customs and Border Protection, is issued with regard to:
a. penalties imposed for non-payment of duties owed.
b. advance determination of the dutiable status of goods.
c. seizure of goods not allowed for import to U.S.
d. all of these are correct.
b. advance determination of the dutiable status of goods.
Countries A and B both produce corn. Both countries belong to GATT. Country A imports corn from B. Once B's corn enters A's stream of commerce, under the national treatment provisions of GATT (see Japan – Taxes on Alcoholic Beverages):
a. country A cannot subject B's corn to higher internal taxes or charges than its domestic corn.
b. country A may now charge higher internal taxes or charges on B's corn because the goods have already passed the border.
c. country A cannot subject B's corn to any internal taxes or charges, even if it does so to domestic corn.
d. none of these are correct.
a. country A cannot subject B's corn to higher internal taxes or charges than its domestic corn.
(see Japan – Taxes on Alcoholic Beverages)
Dutiable status is determined by three factors:
(1)the classification and numerical coding of the article,
(2)the customs value of the article, and
(3)the country of origin of the article
Commercial items that are used for proliferation and terrorism. (Goods used for both commercial and military applications.)
Dual-use items
The excise duties, import duties, and other taxes on exported or re-exported goods that are paid back through a government scheme.
Drawback
All of the following are basic principles of GATT except:
a. non-reciprocal tariff increases.
b. commitment to normal trade relations.c. elimination of import quotas.
d. non-discrimination against imported goods.
a. non-reciprocal tariff increases.
GATT reinforces principles:
Multilateral trade negotiations
Transparency/predictability of trade opportunities
Reciprocal tariff reductions and bound commitments
Nondiscrimination and unconditional MFN
National treatment
Elimination of quotas and other non-tariff barriers
Dispute resolution
According to GATT, quotas are considered acceptable devises for regulating trade only where (see India – Quantitative Restrictions on Imports of Agricultural, Textile, & Industrial Products):
a. they are enacted into law by a nation's legislative body.
b. nations are engaged in a trade war.
c. a nation is imposing a temporary safeguard to protect its balance of payments.
d. a nation has first petitioned the United Nations for permission to do so.
c. a nation is imposing a temporary safeguard to protect its balance of payments.
(see India – Quantitative Restrictions on Imports of Agricultural, Textile, & Industrial Products)
Changes in Export Environment Since 2001 – Several forces:
Terrorism
Nuclear proliferation
Rise of China’s power
Russian geopolitical aggression
The good or the product went through a fundamental change in the exported country which added value to the product.
Substantial transformation
A method used by the importer to lower his possible duty rates. (The process of modifying a product prior to importation, or importing it at an earlier stage of manufacturing, for the purposes of obtaining a lower rate of duty.)
Tariff engineering
Better Home Plastics Corp. v. United States (the shower curtain case) was decided using the following test:
a. true monetary assessment test.
b. essential character test
c. tariff engineering test.
d. none of the above are correct.
b. essential character test
According to Nissan Motor Mfg. Corp., U.S.A. v. United States:
a. Machinery entered into a foreign trade zone for use in the manufacture and assembly of automobiles IS “merchandise” under the act and may not be entered duty-free.
b. Machinery entered into a foreign trade zone for use in the manufacture and assembly of automobiles is NOT “merchandise” under the act and may not be entered duty-free.
c. Machinery entered into the stream of commerce for use in the transportation industry IS “illegal”.
d. none of the above are correct.
b. Machinery entered into a foreign trade zone for use in the manufacture and assembly of automobiles is NOT “merchandise” under the act and may not be entered duty-free.
A drawback is a refund of duties already paid on imported goods when the goods (or other goods manufactured from the original goods) are reexported or destroyed. Name and define 2 of the 4 types of drawbacks.
Manufacturing drawback
Same-condition drawback
Substitution drawback
Rejected merchandise drawback