CCM Regulatory Framework & Compliance 2 — Questions and Answers
Question 1: Under the Uniform Commercial Code (UCC), which article primarily governs the sale of goods in commercial transactions?
- Article 1
- Article 2 (Correct answer)
- Article 4
- Article 9
Correct answer: Article 2
UCC Article 2 governs the sale of goods, establishing default rules for commercial sales contracts.
Question 2: A commercial manager discovers that a supplier is violating OSHA workplace safety regulations. What is the FIRST appropriate action?
- Immediately terminate the supplier contract
- Document the violation and notify legal counsel (Correct answer)
- Report directly to OSHA without internal review
- Ignore it as the supplier's internal matter
Correct answer: Document the violation and notify legal counsel
Documenting the violation and notifying legal counsel ensures the company handles the issue properly and protects against downstream liability.
Question 3: Which federal law prohibits price-fixing agreements between competitors in commercial markets?
- Robinson-Patman Act
- Sherman Antitrust Act (Correct answer)
- Clayton Act
- Federal Trade Commission Act
Correct answer: Sherman Antitrust Act
Section 1 of the Sherman Antitrust Act explicitly prohibits contracts, combinations, or conspiracies in restraint of trade, including price-fixing.
Question 4: What does 'force majeure' in a commercial contract typically protect against?
- Inflationary price increases
- Unforeseeable events beyond a party's control (Correct answer)
- Voluntary non-performance for financial reasons
- Supplier insolvency
Correct answer: Unforeseeable events beyond a party's control
Force majeure clauses excuse non-performance due to extraordinary, unforeseeable events such as natural disasters, wars, or government actions.
Question 5: The Foreign Corrupt Practices Act (FCPA) makes it illegal for U.S. companies to do which of the following?
- Pay commissions to domestic sales agents
- Bribe foreign government officials to obtain business (Correct answer)
- Conduct business in countries under trade sanctions
- Import goods without proper customs declarations
Correct answer: Bribe foreign government officials to obtain business
The FCPA prohibits U.S. persons and entities from bribing foreign officials to obtain or retain business advantages.
Question 6: In U.S. government contracting, a 'Contracting Officer's Technical Representative' (COTR) is primarily responsible for:
- Awarding and signing contracts
- Monitoring contractor technical performance (Correct answer)
- Conducting price negotiations
- Approving contractor invoices for payment
Correct answer: Monitoring contractor technical performance
The COTR monitors day-to-day technical performance of contractors but does not have authority to change contract terms or award contracts.
Question 7: Which regulatory concept requires companies to maintain records of all communications related to a federal contract for a specified retention period?
- Chain of Custody
- Records Retention Policy (Correct answer)
- Freedom of Information Act compliance
- Contract Data Requirements List
Correct answer: Records Retention Policy
Records retention policies, often mandated by FAR Part 4, require contractors to preserve contract-related documents for inspection and audit purposes.
CCM Regulatory Framework & Compliance 2
Under the Uniform Commercial Code (UCC), which article primarily governs the sale of goods in commercial transactions?