Certified Supply Chain Professional (CSCP) Practice Exam

What does the term customs refer to?

1. Government regulation of domestic trade

2. Government regulation of import and export trade at ports

3. Schedule of taxes and fees on local goods

4. Private regulations of trade

The correct answer is: Government regulation of import and export trade at ports

The term customs refers specifically to the government authority responsible for regulating and facilitating international trade, particularly focusing on the import and export of goods at ports and borders. This includes enforcing laws surrounding the entry of goods into a country, collecting duties, taxes, and tariffs applicable to these goods, and ensuring compliance with various trade regulations and restrictions. By emphasizing the role of customs in managing cross-border trade, this definition captures its essential functions, such as preventing smuggling, enforcing regulations on prohibited items, and collecting revenue for the government on imported goods. Understanding this concept is crucial for professionals in supply chain management, as it directly affects logistics, cost management, and compliance with international trade policies. While the other options touch on aspects of trade regulation or taxation, they do not specifically encompass the unique functions carried out by customs in the international trade context. This distinction makes the second option the most accurate representation of the term.