Which of the following regulates barriers to the trade of goods between Member States of WTO?
Correct Answer: B
- The General Agreement on Tariffs and Trade (GATT) is a legal agreement between many countries, whose overall purpose was to promote international trade by reducing or eliminating trade barriers such as tariffs or quotas. According to its preamble, its purpose was the "substantial reduction of tariffs and other trade barriers and the elimination of preferences, on a reciprocal and mutually advantageous basis." - CISG is the Vienna Convention on Contracts for the International Sale of Goods. This is a voluntary treaty under United Nations Commission on International Trade Law (UNCITRAL). The purpose of the Vienna Convention is to set out a framework for international transactions based on a uniform approach. It establishes substantive rules that regulate the duties and obligations of both parties, including the delivery of goods, contract formation, and remedies for breach of contract. - The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) is an international legal agreement between all the member nations of the World Trade Organization (WTO). It sets down minimum standards for the regulation by national governments of many forms of intellectual property (IP) as applied to nationals of other WTO member nations. - The North American Free Trade Agreement (NAFTA; Spanish: Tratado de Libre Comercio de America del Norte, TLCAN; French: Accord de libre-echange nord-americain, ALENA) is an agreement signed by Canada, Mexico, and the United States, creating a trilateral trade bloc in North America. Reference: CIPS study guide page 65-67 LO 1, AC 1.3
Question 77
Which of the following are features of performance specification? 1. Method of achieving the buyer's desired result 2. What needs to be achieved when using the product 3. Purposes of the product 4. Technical and physical characteristics of the product
Correct Answer: D
There are 2 major types of specifications: 1. Performance specifications These are Specifications that define the purpose of the goods or services in terms of how effectively it will perform. Performance is a logical extension of function. Performance specifications define the task or desired result by focusing on what is to be achieved. They do not describe the method of achieving the desired result. 2. Technical (or conformance) specifications These are Specifications that define the technical and physical characteristics and/or measurements of a product, such as physical aspects (e.g. dimensions, colour, and surface finish), design details, material properties, energy requirements, processes, maintenance requirements and operational requirements. They are used when functional and performance characteristics are insufficient to define the requirement and are often used for engineering and information technology requirements. Reference: - Specification Writing - CIPS study guide page 9-11 LO 1, AC 1.1
Question 78
When a contract has been agreed on the basis of a fraudulent misrepresentation, which of the following remedies are available?
Correct Answer: C
An untrue statement of fact or law made by Party A (or its agent) to Party B, which induces Party B to enter a contract with Party A thereby causing Party B loss. An action for misrepresentation can be brought in respect of a misrepresentation of fact or law. There are three types of misrepresentation: - Fraudulent misrepresentation: where a false representation has been made knowingly, or without belief in its truth, or recklessly as to its truth. - Negligent misrepresentation: a representation made carelessly and in breach of duty owed by Party A to Party B to take reasonable care that the representation is accurate. If no "special relationship" exists, there may be a misrepresentation under section 2(1) of the Misrepresentation Act 1967 where a statement is made carelessly or without reasonable grounds for believing its truth. - Innocent misrepresentation: a representation that is neither fraudulent nor negligent. The remedies for misrepresentation are rescission and/or damages. For fraudulent and negligent misrepresentation, the claimant may claim rescission and damages. For innocent misrepresentation, the court has a discretion to award damages in lieu of rescission; the court cannot award both (see section 2(2) of the Misrepresentation Act 1967). For more information, see Practice note, Misrepresentation. Reference: - Misrepresentation - CIPS study guide page 55 LO 1, AC 1.2
Question 79
Under a framework agreement, which of the following are supplier selection mechanisms? Select TWO that apply:
Correct Answer: B,D
A framework agreement is an agreement with one or more suppliers/providers which sets out terms and conditions under which individual contracts (call-offs) can be made throughout the term of the agreement. A framework agreement itself is not a contract, but the call-offs made from it are. Framework arrangements create a streamlined and flexible process for procuring goods, works or services Where a framework for the same goods, works or services is awarded to several suppliers, there are three possible options for awarding call-off contracts: direct award (or direct call-off), mini-competition or a combination of both. Option 1 - Apply the terms of the framework agreement (direct award). Where your requirements match the terms and/or specification of the framework agreement (in the event of any query, you should clarify the situation with the organisation that established the framework), a particular call-off should be awarded without re-opening competition. The call-off should be awarded to the provider who is identified as the most economically advantageous tender based on the award criteria used at the time that the framework was established (i.e. the supplier ranked no. 1). Randomly selecting a supplier off a framework is not permitted. Option 2 - Hold a mini-competition between capable suppliers. If your requirements do not match the terms and/or the specification of the framework, you should conduct a mini-competition exercise. Whilst it is not permitted to substantially change the basic terms or specification of the framework, in running a mini-competition it is possible to supplement or refine the basic terms of the framework prior to making a call-off. Examples of such terms are: - The particular goods/services/works required; - Particular delivery timescales; - Particular invoicing arrangements and payment profiles; - Associated services such as installation, maintenance and training; - Quantity; - Functional specification. Under no circumstances should brand names or brand-specific descriptions of goods be used e.g. BIC Biro Pen, Hewlett-Packard Printer, Dell computer. Descriptions should give reference to the characteristics and outputs of the product or service. Where no other description is possible, any reference should be qualified by adding the words 'or equivalent'. When a mini-competition exercise is held, all suppliers appointed to the framework that are capableof meeting the requirement must be invited to submit a tender. (This might just relate to suppliers within a particular 'lot'). You must not limit the mini-competition exercise to selected providers. A time limit for submitting the tender must be set and advised to competing suppliers. This time limit must be reasonable, taking account of the complexity of the requirement. The call-off must be awarded on the basis of the framework award criteria and new criteria cannot be added, although, where permitted, the weightings may be varied to take account of a particular requirement. However, in adjusting the weightings, care must be taken to ensure that any such changes do not have an adverse effect on competition. Option 3 - Combination of direct award and mini-competition To use a combination approach, the procurement documents must state that this route may be used. The procurement documents will also specify which terms may be subject to the re-opening of competition. Reference: - Guidance on the Use of Framework Agreements - CIPS study guide page 60-62 LO 1, AC 1.3
Question 80
Which of the following is regulated by standard ISO 14001?
Correct Answer: C
ISO has about 22,000 international standards covering a vast range of aspects of product or service quality. Below are some of the most common ISO standards: - ISO 9001: Quality management system - ISO 27001: Information security management - ISO 5001: Energy management - ISO 14001: Environmental management Reference: - ISO 14001:2015 Environmental management systems - Requirements with guidance for use - CIPS study guide page 86 LO 2, AC 2.1
