Bonds Quiz 1, Question 7 & 8

Question 7:

§ 18.25 Direct exportation.
(a) Merchandise –

(1) General. Except for exportations by mail …, an in-bond application must be transmitted …, for the following merchandise when it is to be directly exported without transportation to another port:

(i) Merchandise in CBP custody for which no entry has been made or completed;

(ii) Merchandise covered by an unliquidated consumption entry; or

(iii) Merchandise that has been entered in good faith but is found to be prohibited under any law of the United States.

(f) Notice and proof of exportation. Within two business days after exportation of merchandise described in paragraph (a) of this section, the in-bond record must be updated via a CBP-approved EDI system to reflect that the merchandise has been exported. The principal on any bond filed to guarantee exportation may be required by the port director to provide evidence of exportation in accordance with § 113.55 of this chapter within 30 days of exportation.

It is important to read the question carefully. Here it asks the examinee to find which of the following statements is INCORRECT. The regulations state that the principal (not the surety) on any bond filed to guarantee exportation may be required by the port director to provide evidence of exportation in accordance with § 113.55 of this chapter within 30 days of exportation.

Answer choice D states that the surety on any bond filed to guarantee direct exportation shall cause the merchandise to be exported and provide evidence of such exportation. This is incorrect because it is the principal on the bond who is required to provide evidence of export. Therefore since D is incorrect, it is the correct answer choice for this question, which requires you to find the incorrect choice.

Question 8:

This is an old question and the relevant provision was amended in 2015 to reduce the period from 30 days to 15 days.

§ 112.25 Bonded carriers.
A carrier or freight forwarder who has filed a bond on Customs Form 301 containing the bond conditions set forth in § 113.63 of this chapter may transport merchandise within a port for which the bond provides coverage.

§ 113.13 Amount of bond.
(c) Periodic review of bond sufficiency. CBP will periodically review each bond on file to determine whether the bond is adequate to protect the revenue and ensure compliance with applicable law and regulations. If CBP determines that a bond is inadequate, the principal and surety will be promptly notified in writing. The principal will have 15 days from the date of notification to remedy the deficiency.

Under the old provision T.D. 84-213, 49 FR 41171, Oct. 19, 1984, this time limit was 30 days. However, this was amended by CBP Dec. 15-15, 80 FR 70163, Nov. 13, 2015 to 15 days. Therefore, under the current regulations, A. 15 days from the date of notification is the correct answer.
However, under the old regulations, answer choice B. 30 days from the date of notification was the correct answer.

Quiz 1, Question 7 = the official answer D remains the correct answer because the question is asking you to pick the INCORRECT answer choice.
Answer choice D. The surety on any bond filed to guarantee direct exportation shall cause the merchandise to be exported and provide evidence of such exportation.
The relevant regulation states that “[t]e principal on any bond filed to guarantee exportation may be required by the port director to provide evidence of exportation …” and not the surety. Therefore the statement provided in answer choice D is incorrect. However, the question asks, with respect to merchandise which is exported from Customs custody, without being entered or covered by an unliquidated consumption entry, or denied admission by the Government which of the following statements is INCORRECT?
The statement in answer choice D is incorrect. As the question requires you to pick the incorrect statement, D is the correct answer.
It is very important to read what the question is asking you to do.