National Exam Sample for Customs Broking

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CUSTOMS BROKERS & FORWARDERSCOUNCIL OF AUSTRALIA INC.

NATIONAL EXAMINATION

SAMPLE PAPER

This Examination paper remains the property of the CBFCA.

The National Examination for the Statement of Attainment of Competency for Customs BrokersLicensing carries a maximum possible assessment of 100 marks. To pass the Examination, acandidate must achieve not less than 70% of the total marks possible.



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Question 1

• Question 1 comprises 10 multiple choice questions.• Each question is worth 1 mark.

• Read each question carefully and record the question number and the most correctresponse in your answer booklet.

Question 1 10 marks

Having regard to Australian Customs and related legislation (Including GST legislation),choose the most correct answer to the following:

i Before claiming preferential duty rates for least developed countries(LDC) and East Timor,importers must have access to:

a A Certificate of origin in the format issued by the International Chamber of Commerce (ICC)b A statement from the supplier that the goods conform to origin rulesc Sufficient information that the goods meet the rules of origin for LDCd A signed and certified declaration from the manufacturer of the goods

ii Which of the following is NOT a taxable importation?

a A shipment of steel plate ex China invoiced at US$500,000b Rubber tips of UK origin to make pointers, valued at £670.c Blueprints drafted in Germany for toy trains produced in China sent Free of Charge to the

Australian importer of the goods.d Australian made pre-wired components returned from overseas for repair and return.

iii Some warehouse goods are prescribed as posing a significant risk of government revenueloss through illegal diversion. Several AHECC codes are prescribed and place additionalreporting requirements on warehouse proprietors on export. The prescribed AHECC codescan be found in:

a Schedule 1AA Customs (Prohibited Export) Regulationsb Schedule 1AAA Customs Regulations

c Australian Harmonised Export Commodity Classification Guided Schedule 1AAC Customs Regulations

iv The formal import entry threshold in the ICS is currently $1,000. Under which of the following isthat threshold set:

a Item 32A & 32B of the Customs Tariff Act 1995b The Customs Act 1901c The Customs Regulations 1956d Customs By-laws Numbers 0540003 and 0540004e a & d



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v A Certificate of Origin for US Imports into Australia under the US-Australia Free TradeAgreement can be obtained from:

a The Chamber of Commerce in the US city of originb North American Free Trade Association (NAFTA)c The US Customs Service

d Not required

vi Before dumping or countervailing duties can be imposed by the Minister, it must beestablished:

a Imported goods are coming in cheaply and most Australian importers cannot competeb Material injury is being suffered by importers because of low pricesc Australian industry is suffering material injury as a result of imports priced lower than the

normal value in their home marketsd The export price of imported goods is lower than Australian manufactures

e All of the above

vii The term “import” is defined within the GST legislation to mean:

a having the same meaning as provided in the Customs Act 1901

b brought to the first Port/ airport in Australia where cargo is to be discharged

c not defined in Commonwealth legislation

d import goods into Australia

viii A Customs related law is defined in:

a Section 4AC of the Customs Act

b Section 4B Customs Act

c Section 4C Customs Act

d Section 4 Customs Tariff Act

ix Your client is an Australian manufacturer who imports aluminium channel. Some of theimported material is used to manufacture goods for export. In the manufacturing processAustralian origin materials are integrated with the imported material. Your client queries whatmaterial is eligible for drawback on the exported goods. The client has given pre-exportnotification to Customs in anticipation of the drawback claim You advise:

a Customs duty payable on the entire exported consignmentb Customs duty paid on the proportion of imported material used in the machinec Customs duty paid on the proportion of imported material used in the exported product and

amount wasted in the production processd There is no eligibility for drawback



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x The Trade Description to be applied to porcelain tableware imported as prepackaged goods:

a Must state the country of origin prominently affixed to the outside packageb Must have the country of origin permanently marked on each piece and on the packaging

c Must have size marked in metric measures where includedd Must have the country of origin permanenty affixed to the outside packages in legiblecharacters

e a & c



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QUESTIONS 2, 3, 4 & 5 REQUIRE YOU TO MAKE USE OF FIVE PAGES OFDOCUMENTATION/ INFORMATION INCLUDING BILL OF LADING, COMMERCIAL INVOICESAND IDM.

THIS DOCUMENTATION/ INFORMATION IS IN THE IDM/ADDITIONAL INFORMATION

BOOKLET PROVIDED.

THE ANSWERS YOU OBTAIN IN QUESTION 2 & 3 WILL BE REQUIRED TO COMPLETEQUESTIONS 4 & 5.

Incorrect answers in Question 2 OR 3 will not result in further loss of marks in subsequentQuestions.

QUESTION 2 15 marks

Consider each line on the invoices, provided in the IDM/Additional Information Booklet, separately.

From the description and provided documentation, provide the Tariff Item, tariff concession (if

applicable) and duty rate applicable to EACH LINE of goods within the shipment.

State ALL Authorities.



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QUESTION 3 15 marks

From the preceding invoice and attached IDM/Additional Booklet information calculate the Total

Customs Value for this shipment.

Ensure you quote ALL authorities

QUESTION 4 5 marks

From the preceding invoice and attached IDM/Additional Information booklet calculate the

Customs Value for each of the four commodity lines in this shipment.

QUESTION 5 5 marks

From the preceding invoice and attached IDM/Additional Information booklet calculate the GSTpayable on this Taxable Importation.

QUESTION 6 5 marks

Your client, a well shipbuilder wishes to import specialist hand tools to be used in vessel

construction and repair. The firm only builds ships in excess of 150 tons. Are the tools eligible for

entry under Item 42 of the 4th Schedule?

Please explain your answer.



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QUESTION 7 5 marks

View the items relating to Question 7 in the IDM/Additional Information Booklet. Classify the unit,

and determine the applicable rate of duty. Unit is manufactured in Sweden.

The transverser is used to transport PCB's in an assembly line from one line into two or vice versa.

Quote all authorities

QUESTION 8 10 marks

You are visited in your office by Customs Officers exercising Monitoring Powers

a) What MUST the Customs Officers do before entry?

b) Should you consent to Customs entry into your premises, list five things that the Officersare authorised to do.

Quote ALL authorities

QUESTION 9 5 marks

Your client has imported confectionary, classified 1704.90.00, that was produced entirely in

Thailand. The client had omitted to obtain a Certificate of Origin in the prescribed format and the

shipment was entered and duty paid at the rate of 5% about two months ago. Your client has now

obtained a Certificate of Origin from the Thailand Department of Foreign Trade in the correct

format. The client requests you obtain a refund of duty on the shipment. What procedure will you

advise?

Quote all relevant authorities.



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QUESTION 10 5 marks

Your client imports health foods and health drinks and has recently received research about

Glucomannan from his Japanese supplier. Glucomannan which is classified as a soluble dietary

fibre, is derived from konjac flour. Konjac flour has a long history of use in both China and Japan

as a food substance and as a folk remedy. Glucomannan products are widely used in Japan and

China as general health aids, topically, for skin care and as a thickening agent for foods, among

other things.

Your client advises that the study demonstrated that glucomannan has some efficacy in the

management of obesity. In an eight-week, double-blind study, 20 obese subjects received 1 gram

of glucomannan or placebo daily. Subjects were instructed not to change eating or exercise habits.

Glucomannan-supplemented subjects had a significant mean weight loss of 5.5 pounds. Serum

cholesterol and LDL cholesterol were significantly reduced, as well, in the treated group.

Your client wishes to import the product and calls you for advice. What will you advise?

Quote all authorities

QUESTION 11 5 marks

What are the quarantine clearance procedures and documentation required for the packing of a

Full Container Load (FCL) of hard frozen cargo ex China, with a destination outside of a

metropolitan area.

.



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QUESTION 12 5 marks

Your client has received an infringement notice that relates to unreported goods. Your client ringsyou for advice.

a) What options are available in relation to the notice?

b) After considering the options available, your client remains dissatisfied. What furthercourse of action is available to your client?

QUESTION 13 10 marks

Your client imports a consignment of “French Brandy ” from France. The goods are classified to

tariff item 2208.20.10 / 76

The invoice shows the following details:120 dozen x 700ml bottles of Jacques Freres French Brandy (43% alcohol by volume content)

Invoice Price: Euro(€)5,204 , FOB, packed, 60 days

Exchange Rate = $AUD= Euro 0.59

Using the relevant DCR page in the IDM/Additional Information Booklet, calculate the Interim

Countervailing Duty payable for this shipment. State your authorities.



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QUESTIONS 2, 3, 4 & 5

BILL OF LADING for COMBINED TRANSPORT SHIPMENT OR PORT TO PORT

SHIPMENT

Shipper

VISSER AUTOMATED SYSTEMS1313 PONT DU FRANC

LYON, FRANCE

Consignee or Order

PERFECT GARDENS PTY LTD83 DEAN STREET, SUNBURYMELBOURNE, AUSTRALIATEL. 61-3-32735000

Notify AddressSAME AS CONSIGNEE

Pre-carriage by Place of receipt

Ocean vessel Port of Loading

FLYING SCOTSMAN V.42S LE HAVRE

Port of discharge Place of delivery

MELBOURNE AUSTRALIA MELBOURNE

Marks and Nos; Container No. Number and kind of Packages

FTYU 2456789 1 FCL SAID TO CONTAIN 4PKGS HORTICULTURALEQUIPMENT

.CLEAN ON BOARD

ON VESSEL FLYING SCOTSMAN V.42S24 APRIL 2006

PANALPINA

AS AGENT FOR THE CARRIER, Mason Dixon Line

Freight and Charges

FREIGHT COLLECT

Declared value from Merchant (see clause 7)

Prepaid at

Payable at

DESTINATION

Number of Original B(s)L

THREE (03)Date

Apr 23'2006Gross Weight kg 6650 KG

B/L NO: FTYU4356201001

Mason Dixon Line

Carrier

Mason Dixon Line Ltd.P.O. Box 2454015 Cartier DriveLiberia

For Delivery please apply to

GLOBAL WORLD FREGHT FORWARDING PTY LTY

75 HORRIE MILLER DRIVETULLAMARINE VIC 3007, AUSTRALIATEL (61)3 8267 6001 FAX (61)3 8267 6000

Description of Goods Gross weight kg

HORTICULTURAL EQUIPMENT6650 KG

Received by MASON DIXON LINE for shipment by ocean vessel, betweenport of loading and port of discharge, and frorn place of acceptance to pieceof final delivery as indicated above; the goods as specified above in apparent

good order and condition unless otherwise stated. The goods to be deliveredat the above mentioned port of discharge or place of final delivery. whicheverapplies, subject to terms contained on the reverse side hereof, to which theshipper agrees by accepting this Bill of Lading. In witness whereof three (3)original Bills of Lading have been signed If not otherwise stated above, one ofwhich being accomplished the other(s) to be void.

TOTAL NUMBER OF CONTAINERSOR OTHER PACKAGES OR UNITSRECEIVED BY THE CARRIER: 01

Place of B(s)L-LE HAVRE

PANALPINA



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Exporter

VISSER AUTOMATED SYSTEMS

1313 PONT DU FRANC

LYON, FRANCE

Status of Exporter:(delete terms inapplicable)

ManufacturerGrowerProducerSupplier

Page 1 of 1

Invoice : 5655

Date: 20 April 2006

Sold to:PERFECT GARDENS PTY LTD83 DEAN STREET, SUNBURYMELBOURNE, AUSTRALIATEL. 61-3-32735000

Country of OriginFRANCE

Port of LoadingLE HAVRE

Vessel/ AircraftFLYING SCOTSMAN

Date of Departure23 04 2006

Port of dischargeMELBOURNE

Final DestinationMELBOURNE

TERMS: FAS LE HAVRE

Payment in EURO (€), 30 days from invoice date

Selling price to purchaser – state currency &whether FOB, CIF etc

Marks and numbers, Quantity and Description of goods (include any discounts)

1 (one) TRAYVISION 100 – TIS

200,000 POLYETHLENE SEEDLING TRAYS (288 cells, depth 3.18 cm)

2,000 Organic biodegradable peat plug packs

Relabelling of peat packs

Commission for sourcing and including Morclean equipment ( invoice 23390refers)

SUB - TOTAL

LESS DEPOSIT PAID 31 OCTOBER 2005

Total due

Amount € FAS

450,000.00

2,600.00

3,025.00

150.00

3,200.00

458,975.00

45,000.00

413,975.00

ENUMERATE the following charges and state ifeach amount has been included in the selling

price to purchaser

Amount incurrency of

exporting country

State ifincluded/

Not included

Exporters declaration

1. Value of outside packaging/ containers 600.00 INCL2. Labour in packing goods into outside packages/ containers

200.00 INCLSignatory Company

VISSER AUTO SYSTEMS

3. Inland transport and insurance charges todock/airport area

850.00 INCL

4. Dock and Port charges NIL NOT INCL

Name of Authorised signatory

MR E VISSER

5. Drawback/ remission of duty or taxes NILRoyalties NIL

Place and date of issueLYON APRIL 20, 2006

7. Ocean freight 3,730.00 NOT INCL8. Overseas insurance 391.00 NOT INCL9. Other charges including commissions andsimilar charges (Specify) : (Fumigation)

800.00 NOT INCL

Signature

XwâtÜwÉ e i|ááxÜ



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Additional Information

Rates of Exchange:

20 April 2006 0.5942

21 April 2006 0.594923 April 2006 0.5948

24 April 2006 0.5886

The current sales contract is not affected by any relationship between the parties.

The shipment was packed into the container at the premises of Visser on 20 April

2006. Petit PierresTransport picked up the container on April 21 for transport to Le

Havre.

Tray inspection System (TIS)

The TIS optically scans seedling trays and removes plugs that do not meet predetermined

standards. Horticultural seedlings are cultivated in sectioned trays for easy handling

and are planted from these trays using automatic machines all over the

world. In order to optimise the planting process, a Tray-Inspection-

System (TIS)-checks the quality of seedings in trays.

Visser's automated Vision System is capable of inspecting up to 500

trays per hour and identifying the coordinates of cells without seedlings,

or cells with rejected seedlings, using the data to control the plug

remover that blows out the soil or rejected seedlings from the selected

cells. This data is then used to control machinery that blows out the soil

or rejected seedlings from the marked cells. Utilising this inspection

system led to a 50% labour saving compared to the previous method ofvisual inspection.

The Visser system consists of a tray feeding belt, a plug remover die for

1 tray size, an lcd camera system including pc, plc, monitor and required

software. It also includes a dirt output system consisting of 2 conveyor

belts and a scrap tip container ( contents 1000L ).

Specifications:

LxWxH: 3200 x 1000 x 2200 mmWeight : +/- 500 kg



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Power : 2 kWCapacity: +/- 500 trays/ hour

Seedling Trays

The unfilled trays are constructed of polyethelene and conform to the size of the plug

die in the current machine. Tray specification 288 cells, depth 3.18 cm

Peat Plug Packs

The peat plugs packs consist of trays filled with compressed stabilized peat moss

based on white sphagnum substrata. They are used for the propagation of cuttings

and growing of micropropagated plantlets. Seeds can be planted directly into the pot

and after germination individual plugs can be planted directly into the soil without

disturbing the roots.

In order to conform to Australian marking requirements, the labels affixed to the peat

plugs had to be changed. Visser has charged Perfect Gardens for the labour in

changing the labels however Perfect Gardens also paid € 542 to Pierres’ Fine Labels

in Lyon for the design, printing and delivery of the adhesive labels to the premises of

Visser for the incorporation.

Trailer Mounted high pressure hot water cleaner (See below)

Perfect Gardens also asked Visser to obtain a Trailer Mounted high pressure hot water

cleaner from Morclean Industries, IDM is as below. This high pressure hot water cleaner is

included in the current FCL consignment. :

Model no T21/200:

Consisting of: Triple cylinder water cooled Yanmar with electric start, 3 piston plunger pump,

heat exchanger, thermostat, high pressure 50 litre cold water tank with float switch, 100 litrediesel tank with float switch, 50 ft. high pressure hose with manual hosereel. Trailer comes



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complete with road going wheels, brakes and lights including 50mm ball hitch heavy duty gun

& lance. The machine operates at 18 litres/ minute at 220,000 kPa.



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Visser have invoiced Perfect Gardens separately for these goods. Invoice 23990 refers:

Invoice: 23990

Date: 20 April 2006

VISSER AUTOMATED SYSTEMS

1313 PONT DU FRANC

LYON, FRANCE

Sold to:

PERFECT GARDENS PTY LTD83 DEAN STREET, SUNBURY

MELBOURNE, AUSTRALIATEL. 61-3-32735000

Supply of Trailer Mounted high pressure cleaner € 3,400



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QUESTION 7



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QUESTION 13DUMPING COMMODITIES REGISTER

R. 0 2208.20(1)

BRANDY, BOTTLED (ALCOHOLIC STRENGTH BY VOLUME OF LESS THAN 57%)

2208.20.10/76*

Interim countervailing duty applies for: France

FRANCE

INTERIM COUNTERVAILING DUTY

Interim countervailing duty has been determined for all exports of bottled brandy (alcoholic strength by volume of less than 57%) from France as follows:

Exporter: All exporters

Column 1 Column 2 Column 3 Column 4 Column 5

DSN DESCRIPTION INTERIM

COUNTERVAILING

DUTY

Euro/litre of alcohol

ASCERTAINED

EXPORT PRICE

FOB, port of shipment, cash

A$/lal

NON-INJURIOUS

PRICE FOB, port of

shipment, cashA$/lal

4 Bottled brandy, distilledwholly from grape wine

with an alcoholicstrength by volume of

less than 57%, importedin containers holding

less than 5 litres (with aFOB value below A$13

per lal).

1.751 6.54 10.45

Interim countervailing duty initially imposed on 28 June 2001.

Goods subject to interim countervailing duty must be entered using the relevant DSN.

DIRECTION FOR COLLECTION OF INTERIM COUNTERVAILING DUTY

Interim countervailing duty payable is the difference between (a) and (b) below:

(a) the lower of:

(i) the sum of the ascertained export price and the countervailable subsidy; or

(ii) the non-injurious price.

and

(b) the ascertained export price.

=>Change (12/10/2005)

Documents

National Exam Sample for Customs Broking