CustomsBrokerLicenseExam

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April 2026, question 11

Broker Compliance · Broker licensing and duties

Of the four choices below, which business relationship may Tracy, a licensed customs broker and sole proprietor of her brokerage, maintain without violating CBP regulations?

  1. Tracy transacts customs business on behalf of her client, X-Logistics, a bona fide importer. At the time when she entered into the broker-client relationship, Tracy knew that X-Logistics was a notoriously disreputable importer.
  2. Tracy has an agreement with Faith, another sole proprietor who had her customs broker license suspended with prejudice. For the duration of Faith’s license suspension, Faith refers her clients to Tracy, and Tracy gives Faith a small percentage of the fees collected from the clients Faith referred to her.
  3. Tracy befriends an attorney, Margaret, at a trade conference. Margaret works for the Office of Regulations and Rulings at the Department of Homeland Security and authors classification rulings for the type of widgets that Tracy’s clients import. Tracy treats Margaret to a nice dinner in exchange for the opportunity to talk about the classification rulings pending Margaret’s review.
  4. Tracy hires Paul to help with recordkeeping at her brokerage. Six months after Paul’s start date, Tracy discovers that Paul is a convicted felon. Tracy takes no futher action and continues to employ Paul.
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CBP's answer: A. A: Tracy transacts customs business on behalf of her client, X-Logistics, a bona fide importer. At the time when she entered into the broker-client relationship, Tracy knew that X-Logistics was a notoriously disreputable importer.

A is allowed by the client exception in 111.42(b): nothing prohibits a broker from transacting customs business for a bona fide importer who may be notoriously disreputable. B violates 111.42(a)(4), which bars sharing fees with a person whose license is under suspension. C violates 111.34 by giving a thing of value to influence a DHS employee. D keeps employing a convicted felon without written approval, which is a ground for discipline under 111.53(e).

Nothing in this section will prohibit a broker from transacting customs business on behalf of a bona fide importer or exporter who may be notoriously disreputable 19 CFR 111.42(b)
Share fees with any person described in paragraph (a)(1) of this section 19 CFR 111.42(a)(4)

Search for: client exception

CBP's key cites: 19 CFR 111.42; 19 CFR 111.53; 19 CFR 111.34

Question and key from CBP's April 2026 exam and answer key. The walk-through is ours; quotes are from the pinned editions in the reference viewer (HTSUS 2026 Basic, 19 CFR 2025 edition).