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Question 1. Which part of the United States Munitions List (USML) contains items related to “fire control, fire simulation, and range finder” equipment? A) Category I – Firearms, Close-in Weapon Systems, and Ammunition B) Category III – Spacecraft and associated equipment C) Category V – Tactical missiles D) Category IX – Fire control, fire simulation, and range finder equipment Answer: D Explanation: Category IX of the USML specifically addresses fire control, fire simulation, and range finder equipment, distinguishing it from other categories that cover weapons, spacecraft, or missiles. Question 2. Under ITAR, a U.S. manufacturer must register with the DDTC if its annual sales of defense articles exceed: A) $10, B) $100, C) $1,000, D) $5,000, Answer: C Explanation: The DDTC requires registration for any person who manufactures, exports, or brokers defense articles when the aggregate value of such activities exceeds $1 million in a 12-month period. Question 3. Which of the following is considered “technical assistance” under ITAR? A) Providing a foreign customer a user manual that is publicly available on the Internet B) Conducting a live, on-site training session on the operation of a classified missile system C) Shipping a completed defense article without any accompanying documentation D) Supplying raw materials that are not listed on the USML Answer: B
Explanation: Technical assistance includes the transfer of knowledge, skills, or expertise related to a defense article, such as on-site training for a classified system. Publicly available manuals are not controlled technical data. Question 4. Which form is used to apply for a license to export a defense article listed on the USML? A) DSP- 5 B) DSP- 73 C) DSP- 61 D) DS- 2032 Answer: A Explanation: DSP-5 is the standard application for the export of a defense article, technical data, or defense services listed on the USML. Question 5. An exporter wishes to ship a USML-controlled item to a foreign government that is a party to a U.S. arms embargo. Which ITAR exemption, if any, could be used? A) 126.18 – Temporary Export for Demonstration or Evaluation B) 125.4 – Exemption for Certain Shipments to NATO Countries C) No exemption applies; a license is required and may be denied D) 125.1 – Exemption for Information in the Public Domain Answer: C Explanation: When a destination is subject to an arms embargo, no ITAR exemption can be used; a license must be obtained and is likely to be denied. Question 6. A U.S. broker facilitates the transfer of a defense article from a U.S. manufacturer to a foreign end-user. Which regulation governs the broker’s activities? A) EAR Part 738 B) ITAR Part 124 – Brokering C) OFAC’s 31 CFR Part 500 D) BIS Export Administration Regulations, § 734.5(b) Answer: B
Question 10. Under ITAR, a “defense service” includes which of the following activities? A) Providing a foreign customer with a commercial off-the-shelf software license B) Offering engineering assistance to modify a USML-listed missile C) Shipping an unclassified spare part to a foreign contractor D) Supplying raw metal for non-defense use Answer: B Explanation: Defense services encompass assistance, training, or advice related to the design, development, production, or use of defense articles, such as missile modification. Question 11. Which EAR category contains “high-performance computers” that are subject to export controls? A) Category 0 – Nuclear Materials, Facilities, and Equipment B) Category 1 – Materials, Chemicals, Microorganisms, and Toxins C) Category 3 – Electronics D) Category 9 – Aerospace and Propulsion Answer: C Explanation: Category 3 of the Commerce Control List (CCL) covers electronics, including high-performance computers. Question 12. An exporter classifies an item with ECCN 5A992. Which of the following statements is true? A) The item is always subject to a license regardless of destination B) The item is a dual-use commodity with low strategic importance and may be exported under a license exception to many destinations C) The item is a purely military article listed on the USML D) The item is prohibited from export to any foreign country Answer: B Explanation: ECCN 5A992 represents low-technology, dual-use items that generally qualify for license exceptions, such as LVS or GBS, to most destinations.
Question 13. The “deemed export” rule under the EAR applies when: A) A U.S. company ships a physical item abroad B) Controlled technical data is transmitted to a foreign national within the United States C) A foreign national visits a U.S. manufacturing plant without receiving any technical information D) An export license is denied by BIS Answer: B Explanation: Deemed export treats the release of controlled technology to a foreign national in the U.S. as an export, requiring a license if the technology is subject to EAR controls. Question 14. Which license exception allows the export of certain “technology and software” to Canada without a license, provided the end-use is not prohibited? A) LVS – Limited Value Shipments B) GBS – Group B Shipments C) RPL – Royalty Payment License Exception D) STA – Strategic Trade Authorization Answer: B Explanation: GBS (Group B Shipments) permits the export of certain technology and software to Canada under specific conditions, without requiring a license. Question 15. In the SNAP-R system, what is the purpose of the “Commodity Classification Request” (CCR)? A) To request a license for a controlled item B) To obtain a definitive ECCN for an item that is not yet classified C to submit an export declaration to CBP D) To register a new exporter in the BIS database Answer: B Explanation: A CCR is submitted to BIS to obtain an official classification (ECCN) for a product when the exporter is uncertain of its proper classification.
Explanation: OFAC (Office of Foreign Assets Control) maintains the CSL, which includes SDNs, Denied Persons, and Debarred Parties. Question 19. An exporter wishes to ship goods to Iran. Which type of sanction applies? A Targeted sanctions covering only specific individuals B Comprehensive embargo prohibiting most exports without a specific license C Sector-specific sanctions allowing weapons exports but restricting dual-use items D No sanctions; Iran is a normal trade partner Answer: B Explanation: Iran is subject to a comprehensive U.S. embargo that generally prohibits most exports, requiring a specific license for any authorized transaction. Question 20. End-use controls under OFAC require an exporter to verify that a dual-use item is not being used for: A Commercial aviation B Medical research C Development of weapons of mass destruction (WMD) D Civilian telecommunications Answer: C Explanation: OFAC’s end-use controls focus on preventing the diversion of items to WMD programs, ensuring that dual-use items are not used for prohibited military or proliferation purposes. Question 21. Which of the following statements about the Automated Export System (AES) is correct? A AES is used only for imports into the United States B Filing EEI through AES is mandatory for all exports valued over $2,500 or those requiring an export license C AES automatically generates a D-Trade license number for ITAR shipments D AES replaces the need for a commercial invoice Answer: B
Explanation: The EEI must be filed in AES for all exports valued over $2,500 (or any value if an export license is required), ensuring compliance with CBP requirements. Question 22. The Internal Transaction Number (ITN) generated by AES is required on which export document? A Certificate of Origin B Commercial Invoice and Bill of Lading C Export Packing List only D Letter of Credit Answer: B Explanation: The ITN must be printed on the commercial invoice and bill of lading for shipments subject to EEI filing, serving as proof of filing. Question 23. Which Destination Control Statement (DCS) is appropriate for an ITAR-controlled shipment? A “This shipment is authorized under the EAR, Export Control Classification Number 5A992.” B “This item is subject to the Export Administration Regulations and may not be transferred without a license.” C “This item is controlled under the United States Munitions List; export is authorized by DDTC.” D “No destination control statement is required for ITAR items.” Answer: C Explanation: ITAR shipments require a DCS indicating that the item is controlled under the USML and that export is authorized by the DDTC. Question 24. For EAR-controlled items, which statement should appear on the commercial invoice? A “This item is controlled under the United States Munitions List (USML).” B “This shipment is authorized under the Export Administration Regulations, ECCN 3A001.” C “This item is exempt from all export controls.” D “No Export Control Statement is required for EAR items.”
Explanation: An effective ICP includes a written policy, employee training, and internal audits to detect and prevent violations. Question 28. Voluntary Self-Disclosure (VSD) to the DDTC can result in: A Automatic criminal prosecution B A reduction in potential civil penalties and possible mitigation of sanctions C Immediate revocation of all export licenses D No impact on enforcement actions Answer: B Explanation: Timely VSD often leads to reduced penalties and may help mitigate enforcement actions, demonstrating cooperation with authorities. Question 29. Under the Foreign Corrupt Practices Act (FCPA), a U.S. exporter must avoid: A Offering a discount to a foreign buyer for early payment B Providing a legitimate marketing expense to a foreign agent C Bribing a foreign government official to obtain or retain business D Negotiating contract terms with a foreign distributor Answer: C Explanation: The FCPA prohibits bribery of foreign officials to obtain or retain business, even if the payment is disguised as a “facilitation” fee. Question 30. Which of the following scenarios would most likely constitute an ethical dilemma for a compliance officer? A Choosing between two equally compliant shipping routes B Deciding whether to report a minor, inadvertent violation that could be corrected internally C Selecting a preferred vendor based on cost D Updating the company’s website with new product photos Answer: B Explanation: Determining whether to self-report a minor violation involves ethical judgment about transparency versus potential reputational harm.
Question 31. Which USML category includes “spacecraft, satellites, and related launch vehicles”? A Category II – Missiles and Rockets B Category III – Spacecraft and Associated Equipment C Category IV – Launch Vehicles, Rockets, and Associated Equipment D Category VII – Directed Energy Weapons Answer: B Explanation: Category III specifically covers spacecraft, satellites, and related launch vehicle components. Question 32. A U.S. defense contractor wants to export a prototype radar system to a foreign ally. Which ITAR form must be completed to obtain approval for the export of technical data? A DSP- 61 – Technical Data B DSP- 5 – Defense Article Export C DSP- 73 – Temporary Export D DS- 2032 – Registration Form Answer: A Explanation: DSP-61 is the application for the export of technical data, such as design specifications for a radar system. Question 33. An exporter claims an item is “public domain” to avoid ITAR licensing. Which of the following would disprove that claim? A The item is listed on a publicly accessible university website B The item appears in a classified government technical manual not released to the public C The item is sold commercially in a hardware store D The item is described in a non-technical magazine article Answer: B Explanation: Information contained in a classified manual is not public domain and remains subject to ITAR controls.
Question 37. A U.S. company receives a request from a foreign buyer to sign a contract that includes a clause requiring the buyer to boycott all products from a third country not sanctioned by the U.S. How must the U.S. company respond under antiboycott regulations? A Agree to the clause, as it does not affect U.S. law B Refuse to sign the clause and report the request to OFAC C Ignore the clause and proceed with the contract D Seek a waiver from the Department of State Answer: B Explanation: Antiboycott regulations prohibit participation in foreign boycotts not authorized by the U.S.; the company must refuse and report the request to OFAC. Question 38. Which of the following is considered a “Denial” entry on the Consolidated Screening List? A A foreign government that has been sanctioned for human rights abuses B An individual who has been convicted of espionage against the United States C A corporation that has voluntarily withdrawn from U.S. trade D A U.S. citizen who has applied for a passport Answer: B Explanation: Denied Persons are individuals or entities that have been prohibited from participating in U.S. transactions, often due to espionage, terrorism, or other serious violations. Question 39. An exporter wants to ship a dual-use chemical to a country that is subject to a U.S. “comprehensive embargo.” Which action is required? A Ship the item under the “LVS” license exception B Apply for an EAR export license and obtain a specific authorization from OFAC C No license is needed because the item is not listed on the USML D Use the “GBS” license exception for a humanitarian shipment Answer: B Explanation: Even for dual-use items, a comprehensive embargo requires a specific license from OFAC and possibly an EAR license; exceptions like LVS or GBS do not apply.
Question 40. Which of the following best describes “end-use verification” in export compliance? A Confirming that the buyer has paid the invoice in full B Ensuring that the exported item will be used for the purpose stated by the buyer and not for prohibited activities C Checking that the shipping container meets size specifications D Verifying the accuracy of the commercial invoice totals Answer: B Explanation: End-use verification involves confirming that the product will be used as declared and not diverted to prohibited or illicit activities. Question 41. When filing EEI in AES, which of the following information is NOT required? A Exporter’s EIN (Employer Identification Number) B ECCN or USML Category of the item C The name of the carrier’s pilot D Shipment value in U.S. dollars Answer: C Explanation: The carrier’s pilot name is not required for EEI filing; required fields include exporter’s EIN, classification, and shipment value. Question 42. Which statement accurately reflects the difference between an “ITAR Destination Control Statement” and an “EAR Destination Control Statement”? A ITAR DCS references the USML; EAR DCS references the ECCN B Both DCS statements are identical in wording C EAR DCS must be placed on the bill of lading, while ITAR DCS is optional D ITAR DCS is only required for shipments valued under $2, Answer: A Explanation: ITAR DCS cites the United States Munitions List (USML) whereas EAR DCS cites the Export Administration Regulations and the specific ECCN.
Explanation: Transactions with SDNs are prohibited; the company must halt the shipment and report the violation to OFAC. Question 46. Which of the following best describes a “brokering” activity prohibited under ITAR? A Acting as a shipping agent for a defense article without providing any advice B Negotiating a contract between a U.S. defense manufacturer and a foreign buyer for a USML-listed weapon system C Providing translation services for a non-controlled commercial invoice D Arranging a meeting between two U.S. companies that are not exporting defense articles Answer: B Explanation: Brokering that facilitates the manufacture, export, or transfer of USML-controlled defense articles requires a license under ITAR. Question 47. Which of the following is NOT a requirement for an exporter to be eligible for the “GBS” (Group B) license exception? A The foreign destination must be Canada, Mexico, or a NATO country B The item must be classified under an ECCN that allows GBS C The transaction value must be less than $250,000 per year D The exporter must have a written agreement with the foreign recipient stating the intended end-use Answer: C Explanation: GBS does not have a monetary threshold; it is based on destination and ECCN eligibility, not transaction value. Question 48. Under the “Red Flags” guidance, which of the following is a primary indicator of potential diversion? A The buyer provides a detailed end-use statement with supporting documentation B The transaction involves a reputable U.S. distributor with a long history of compliance C The buyer requests a “split-shipment” to multiple undisclosed destinations D The export is for a low-value, commercially available product
Answer: C Explanation: Split-shipment to undisclosed destinations is a classic red flag suggesting possible diversion or evasion of controls. Question 49. Which of the following actions would constitute a violation of the “Anti-Boycott” regulations? A Providing a discount to a foreign buyer who requests a “no-boycott” clause B Refusing to sell to a country under a U.S. embargo C Agreeing to a foreign government’s request to boycott a third country not sanctioned by the U.S. D Reporting a suspected boycott request to OFAC Answer: C Explanation: Participating in a foreign-imposed boycott that is not authorized by the U.S. violates anti-boycott regulations. Question 50. Which of the following best describes the purpose of a “Commodity Classification Request” (CCR) in SNAP-R? A To obtain a license for a controlled item B To request a determination of the correct ECCN for an item C To submit a commercial invoice for customs clearance D To register a new exporter in the BIS system Answer: B Explanation: A CCR is filed to receive an official classification (ECCN) for a product when the exporter is uncertain of its proper categorization. Question 51. An exporter wishes to ship a “dual-use” item to a foreign end-user in a country subject to U.S. “targeted sanctions.” Which licensing approach is appropriate? A Use the “LVS” license exception because the item is low-value B Apply for an EAR license and obtain a specific OFAC authorization if required C Ship under the “GBS” exception because the destination is a NATO ally D No license is needed because targeted sanctions only affect military items
Explanation: ECCN 2B001 covers certain dual-use chemicals and requires licenses for export to restricted destinations. Question 55. Which of the following actions would most likely trigger a “Red Flag” for potential diversion to a WMD program? A Exporting a low-technology office printer to a known academic institution B Shipping high-purity uranium to a country with a known nuclear weapons program without a license C Providing a standard-issue laptop to a foreign employee of a U.S. subsidiary D Selling a commercial washing machine to a retail store Answer: B Explanation: Shipping high-purity uranium to a country with a WMD program without a license is a classic red flag indicating potential proliferation. Question 56. Which of the following best describes the “Export Administration Regulations” (EAR) jurisdiction? A Only items listed on the USML are covered B All items that are “dual-use” or have both civilian and military applications are covered C Only items exported to NATO countries are covered D Only items with a monetary value above $10,000 are covered Answer: B Explanation: EAR governs the export of dual-use items, which have both civilian and military applications, regardless of destination. Question 57. A U.S. exporter receives a request to provide “technical assistance” to a foreign national who is a permanent resident of the United States. Which regulation applies? A ITAR – deemed export rule B EAR – deemed export rule C OFAC sanctions – anti-boycott rule D None – technical assistance to U.S. residents is unrestricted Answer: A
Explanation: Providing technical assistance to a foreign national within the U.S. is a deemed export under ITAR if the assistance involves USML-controlled items. Question 58. Which of the following is an example of a “License Exception” under the EAR that allows export of “software” to a foreign government for “civilian” use? A STA – Strategic Trade Authorization B GBS – Group B Shipments C LVS – Limited Value Shipments D RPL – Royalty Payment License Exception Answer: C Explanation: LVS permits the export of software and technology of limited value for civilian use without a license, provided the destination is not restricted. Question 59. Which of the following is NOT a required element of a “Voluntary Self-Disclosure” (VSD) to the DDTC? A A detailed description of the violation B Copies of all related export documents C A request for a monetary penalty waiver D A corrective action plan to prevent future violations Answer: C Explanation: While a VSD includes a description, supporting documents, and corrective actions, it does not require a request for a penalty waiver. Question 60. Under the FCPA, which of the following is considered a “facilitating payment”? A A small cash payment to a foreign official to expedite routine customs clearance of non-controlled goods B A large bribe to secure a government contract for a defense article C A donation to a foreign political party in exchange for favorable legislation D A rebate offered to a foreign distributor for volume purchases Answer: A
