United States of America

Title 19 Customs Duties

Parts 0 to 140

Revised as of April 1, 2012

Containing a codification of documents of general applicability and future effect

As of April 1, 2012

Published by the Office of the Federal Register National Archives and Records Administration as a Special Edition of the Federal Register

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00001 Fmt 8091 Sfmt 8091 Q:\19\19V1.TXT ofr150 PsN: PC150

U.S. GOVERNMENT OFFICIAL EDITION NOTICE

Legal Status and Use of Seals and Logos

The seal of the National Archives and Records Administration (NARA) authenticates the Code of Federal Regulations (CFR) as the official codification of Federal regulations established under the Federal Register Act. Under the provisions of 44 U.S.C. 1507, the contents of the CFR, a special edition of the Federal Register, shall be judicially noticed. The CFR is prima facie evidence of the origi- nal documents published in the Federal Register (44 U.S.C. 1510).

It is prohibited to use NARA’s official seal and the stylized Code of Federal Regulations logo on any republication of this material without the express, written permission of the Archivist of the United States or the Archivist’s designee. Any person using NARA’s official seals and logos in a manner inconsistent with the provisions of 36 CFR part 1200 is subject to the penalties specified in 18 U.S.C. 506, 701, and 1017.

Use of ISBN Prefix

This is the Official U.S. Government edition of this publication and is herein identified to certify its authenticity. Use of the 0–16 ISBN prefix is for U.S. Government Printing Office Official Edi- tions only. The Superintendent of Documents of the U.S. Govern- ment Printing Office requests that any reprinted edition clearly be labeled as a copy of the authentic work with a new ISBN.

U .S . GOVERNMENT PRINTING OFFICE

U.S. Superintendent of Documents • Washington, DC 20402–0001

http://bookstore.gpo.gov

Phone: toll-free (866) 512-1800; DC area (202) 512-1800

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00002 Fmt 8092 Sfmt 8092 Q:\19\19V1.TXT ofr150 PsN: PC150 arc hi

ve s.

ai <

/G P

H >

gp ol

og o.

ep s<

/G P

H >

iii

Table of Contents Page

Explanation ................................................................................................ v

Title 19:

Chapter I—U.S. Customs and Border Protection, Department of Homeland Security; Department of the Treasury ....................... 3

Finding Aids:

Table of CFR Titles and Chapters ....................................................... 897

Alphabetical List of Agencies Appearing in the CFR ......................... 917

Chapter I Subject Index ...................................................................... 927

List of CFR Sections Affected ............................................................. 1045

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00003 Fmt 8092 Sfmt 8092 Q:\19\19V1.TXT ofr150 PsN: PC150

iv

Cite this Code: CFR

To cite the regulations in this volume use title, part and section num- ber. Thus, 19 CFR 0.1 refers to title 19, part 0, section 1.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00004 Fmt 8092 Sfmt 8092 Q:\19\19V1.TXT ofr150 PsN: PC150

v

Explanation

The Code of Federal Regulations is a codification of the general and permanent rules published in the Federal Register by the Executive departments and agen- cies of the Federal Government. The Code is divided into 50 titles which represent broad areas subject to Federal regulation. Each title is divided into chapters which usually bear the name of the issuing agency. Each chapter is further sub- divided into parts covering specific regulatory areas.

Each volume of the Code is revised at least once each calendar year and issued on a quarterly basis approximately as follows:

Title 1 through Title 16..............................................................as of January 1 Title 17 through Title 27 .................................................................as of April 1 Title 28 through Title 41 ..................................................................as of July 1 Title 42 through Title 50.............................................................as of October 1

The appropriate revision date is printed on the cover of each volume.

LEGAL STATUS

The contents of the Federal Register are required to be judicially noticed (44 U.S.C. 1507). The Code of Federal Regulations is prima facie evidence of the text of the original documents (44 U.S.C. 1510).

HOW TO USE THE CODE OF FEDERAL REGULATIONS

The Code of Federal Regulations is kept up to date by the individual issues of the Federal Register. These two publications must be used together to deter- mine the latest version of any given rule.

To determine whether a Code volume has been amended since its revision date (in this case, April 1, 2012), consult the ‘‘List of CFR Sections Affected (LSA),’’ which is issued monthly, and the ‘‘Cumulative List of Parts Affected,’’ which appears in the Reader Aids section of the daily Federal Register. These two lists will identify the Federal Register page number of the latest amendment of any given rule.

EFFECTIVE AND EXPIRATION DATES

Each volume of the Code contains amendments published in the Federal Reg- ister since the last revision of that volume of the Code. Source citations for the regulations are referred to by volume number and page number of the Federal Register and date of publication. Publication dates and effective dates are usu- ally not the same and care must be exercised by the user in determining the actual effective date. In instances where the effective date is beyond the cut- off date for the Code a note has been inserted to reflect the future effective date. In those instances where a regulation published in the Federal Register states a date certain for expiration, an appropriate note will be inserted following the text.

OMB CONTROL NUMBERS

The Paperwork Reduction Act of 1980 (Pub. L. 96–511) requires Federal agencies to display an OMB control number with their information collection request.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00005 Fmt 8008 Sfmt 8092 Q:\19\19V1.TXT ofr150 PsN: PC150

vi

Many agencies have begun publishing numerous OMB control numbers as amend- ments to existing regulations in the CFR. These OMB numbers are placed as close as possible to the applicable recordkeeping or reporting requirements.

OBSOLETE PROVISIONS

Provisions that become obsolete before the revision date stated on the cover of each volume are not carried. Code users may find the text of provisions in effect on a given date in the past by using the appropriate numerical list of sections affected. For the period before January 1, 2001, consult either the List of CFR Sections Affected, 1949–1963, 1964–1972, 1973–1985, or 1986–2000, published in eleven separate volumes. For the period beginning January 1, 2001, a ‘‘List of CFR Sections Affected’’ is published at the end of each CFR volume.

‘‘[RESERVED]’’ TERMINOLOGY

The term ‘‘[Reserved]’’ is used as a place holder within the Code of Federal Regulations. An agency may add regulatory information at a ‘‘[Reserved]’’ loca- tion at any time. Occasionally ‘‘[Reserved]’’ is used editorially to indicate that a portion of the CFR was left vacant and not accidentally dropped due to a print- ing or computer error.

INCORPORATION BY REFERENCE

What is incorporation by reference? Incorporation by reference was established by statute and allows Federal agencies to meet the requirement to publish regu- lations in the Federal Register by referring to materials already published else- where. For an incorporation to be valid, the Director of the Federal Register must approve it. The legal effect of incorporation by reference is that the mate- rial is treated as if it were published in full in the Federal Register (5 U.S.C. 552(a)). This material, like any other properly issued regulation, has the force of law.

What is a proper incorporation by reference? The Director of the Federal Register will approve an incorporation by reference only when the requirements of 1 CFR part 51 are met. Some of the elements on which approval is based are:

(a) The incorporation will substantially reduce the volume of material pub- lished in the Federal Register.

(b) The matter incorporated is in fact available to the extent necessary to afford fairness and uniformity in the administrative process.

(c) The incorporating document is drafted and submitted for publication in accordance with 1 CFR part 51.

What if the material incorporated by reference cannot be found? If you have any problem locating or obtaining a copy of material listed as an approved incorpora- tion by reference, please contact the agency that issued the regulation containing that incorporation. If, after contacting the agency, you find the material is not available, please notify the Director of the Federal Register, National Archives and Records Administration, 8601 Adelphi Road, College Park, MD 20740-6001, or call 202-741-6010.

CFR INDEXES AND TABULAR GUIDES

A subject index to the Code of Federal Regulations is contained in a separate volume, revised annually as of January 1, entitled CFR INDEX AND FINDING AIDS. This volume contains the Parallel Table of Authorities and Rules. A list of CFR titles, chapters, subchapters, and parts and an alphabetical list of agencies pub- lishing in the CFR are also included in this volume.

An index to the text of ‘‘Title 3—The President’’ is carried within that volume.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00006 Fmt 8008 Sfmt 8092 Q:\19\19V1.TXT ofr150 PsN: PC150

vii

The Federal Register Index is issued monthly in cumulative form. This index is based on a consolidation of the ‘‘Contents’’ entries in the daily Federal Reg- ister.

A List of CFR Sections Affected (LSA) is published monthly, keyed to the revision dates of the 50 CFR titles.

REPUBLICATION OF MATERIAL

There are no restrictions on the republication of material appearing in the Code of Federal Regulations.

INQUIRIES

For a legal interpretation or explanation of any regulation in this volume, contact the issuing agency. The issuing agency’s name appears at the top of odd-numbered pages.

For inquiries concerning CFR reference assistance, call 202–741–6000 or write to the Director, Office of the Federal Register, National Archives and Records Administration, 8601 Adelphi Road, College Park, MD 20740-6001 or e-mail fedreg.info@nara.gov.

SALES

The Government Printing Office (GPO) processes all sales and distribution of the CFR. For payment by credit card, call toll-free, 866-512-1800, or DC area, 202- 512-1800, M-F 8 a.m. to 4 p.m. e.s.t. or fax your order to 202-512-2104, 24 hours a day. For payment by check, write to: US Government Printing Office – New Orders, P.O. Box 979050, St. Louis, MO 63197-9000.

ELECTRONIC SERVICES

The full text of the Code of Federal Regulations, the LSA (List of CFR Sections Affected), The United States Government Manual, the Federal Register, Public Laws, Public Papers of the Presidents of the United States, Compilation of Presi- dential Documents and the Privacy Act Compilation are available in electronic format via www.ofr.gov. For more information, contact the GPO Customer Con- tact Center, U.S. Government Printing Office. Phone 202-512-1800, or 866-512-1800 (toll-free). E-mail, gpo@custhelp.com.

The Office of the Federal Register also offers a free service on the National Archives and Records Administration’s (NARA) World Wide Web site for public law numbers, Federal Register finding aids, and related information. Connect to NARA’s web site at www.archives.gov/federal-register.

MICHAEL L. WHITE,

Acting Director,

Office of the Federal Register.

April 1, 2012.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00007 Fmt 8008 Sfmt 8092 Q:\19\19V1.TXT ofr150 PsN: PC150

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00008 Fmt 8008 Sfmt 8092 Q:\19\19V1.TXT ofr150 PsN: PC150

ix

THIS TITLE

Title 19—CUSTOMS DUTIES is composed of three volumes. The first two volumes, parts 0—140 and parts 141—199 contain the regulations in Chapter I—U.S. Customs and Border Protection, Department of Homeland Security; Department of the Treasury. The third volume, part 200 to end, contains the regulations in Chapter II—United States International Trade Commission; Chapter III—International Trade Administration, Department of Commerce; and Chapter IV—U.S. Immigra- tion and Customs Enforcement, Department of Homeland Security. The contents of these volumes represent all current regulations issued under this title of the CFR as of April 1, 2012.

A Subject Index to Chapter I—U.S. Customs and Border Protection, Depart- ment of Homeland Security; Department of the Treasury appears in the Finding Aids section of the first two volumes.

For this volume, Jonn V. Lilyea was Chief Editor. The Code of Federal Regula- tions publication program is under the direction of Michael L. White, assisted by Ann Worley.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00009 Fmt 8092 Sfmt 8092 Q:\19\19V1.TXT ofr150 PsN: PC150

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00010 Fmt 8092 Sfmt 8092 Q:\19\19V1.TXT ofr150 PsN: PC150

1

Title 19—Customs Duties

(This book contains parts 0 to 140)

Part

CHAPTER I—U.S. Customs and Border Protection, Depart- ment of Homeland Security; Department of the Treasury 3

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00011 Fmt 8008 Sfmt 8008 Q:\19\19V1.TXT ofr150 PsN: PC150

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00012 Fmt 8008 Sfmt 8008 Q:\19\19V1.TXT ofr150 PsN: PC150

3

CHAPTER I—U.S. CUSTOMS AND BORDER PROTECTION, DEPARTMENT OF HOMELAND SECURITY; DEPARTMENT OF THE TREASURY

EDITORIAL NOTE: Nomenclature changes to chapter I appear at CBP Dec. 07–82, 72 FR 59167, Oct. 19, 2007.

Part Page 0 Transferred or delegated authority ......................... 5 1–3 [Reserved] 4 Vessels in foreign and domestic trades ................... 7 7 Customs relations with insular possessions and

Guantanamo Bay Naval Station .......................... 79 10 Articles conditionally free, subject to a reduced

rate, etc. ............................................................... 84 11 Packing and stamping; marking ............................. 388 12 Special classes of merchandise ................................ 394 18 Transportation in bond and merchandise in transit 452 19 Customs warehouses, container stations and con-

trol of merchandise therein .................................. 470 24 Customs financial and accounting procedure .......... 507 54 Certain importations temporarily free of duty ....... 563 101 General provisions .................................................. 564 102 Rules of origin ......................................................... 577 103 Availability of information ..................................... 638 111 Customs brokers ...................................................... 660 112 Carriers, cartmen, and lightermen .......................... 683 113 Customs bonds ......................................................... 692 114 Carnets .................................................................... 720 115 Cargo container and road vehicle certification pur-

suant to international customs conventions ....... 724 118 Centralized examination stations ........................... 734 122 Air Commerce regulations ...................................... 739 123 CBP relations with Canada and Mexico .................. 815 125 Cartage and lighterage of merchandise ................... 839 127 General order, unclaimed, and abandoned merchan-

dise ....................................................................... 843 128 Express consignments ............................................. 851 132 Quotas ..................................................................... 855

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00013 Fmt 8008 Sfmt 8008 Q:\19\19V1.TXT ofr150 PsN: PC150

4

19 CFR Ch. I (4–1–12 Edition)

Part Page 133 Trademarks, trade names, and copyrights .............. 863 134 Country of origin marking ...................................... 879 135–140 [Reserved]

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00014 Fmt 8008 Sfmt 8008 Q:\19\19V1.TXT ofr150 PsN: PC150

5

PART 0—TRANSFERRED OR DELEGATED AUTHORITY

Sec. 0.1 Customs revenue function regulations

issued under the authority of the Depart- ments of the Treasury and Homeland Se- curity.

0.2 All other Customs Regulations issued under the authority of the Department of Homeland Security.

APPENDIX TO PART 0—TREASURY DEPARTMENT ORDER NO. 100–16

AUTHORITY: 5 U.S.C. 301, 6 U.S.C. 101 et seq., 19 U.S.C. 66, 19 U.S.C. 1624, 31 U.S.C. 321.

SOURCE: CBP Dec. 03–24, 68 FR 51869, Aug. 28, 2003, unless otherwise noted.

§ 0.1 Customs revenue function regula- tions issued under the authority of the Departments of the Treasury and Homeland Security.

(a) Regulations requiring signatures of Treasury and Homeland Security. (1) By Treasury Department Order No. 100–16, set forth in the appendix to this part, the Secretary of the Treasury has dele- gated to the Secretary of Homeland Se- curity the authority to prescribe all CBP regulations relating to customs revenue functions, except that the Sec- retary of the Treasury retains the sole authority to approve such CBP regula- tions concerning subject matters listed in paragraph 1(a)(i) of the order. Regu- lations for which the Secretary of the Treasury retains the sole authority to approve will be signed by the Secretary of Homeland Security (or his or her DHS delegate), and by the Secretary of the Treasury (or his or her Treasury delegate) to indicate approval.

(2) When a regulation described in paragraph (a)(1) of this section is pub- lished in the FEDERAL REGISTER, the preamble of the document accom- panying the regulation will clearly in- dicate that it is being issued in accord- ance with paragraph (a)(1) of this sec- tion.

(b) Regulations with respect to which the Department of Homeland Security is authorized to sign for the Department of the Treasury. (1) By Treasury Depart- ment Order No. 100–16, set forth in the appendix to this part, the Secretary of the Treasury delegated to the Sec- retary of Homeland Security the au- thority to prescribe and approve regu-

lations relating to customs revenue functions on behalf of the Secretary of the Treasury when the subject matter of the regulations is not listed in para- graph 1(a)(i) of the order. Such regula- tions are the official regulations of both Departments notwithstanding that they are not signed by an official of the Department of the Treasury. These regulations will be signed by the Secretary of Homeland Security (or his or her DHS delegate).

(2) When a regulation described in paragraph (b)(1) of this section is pub- lished in the FEDERAL REGISTER, the preamble of the document accom- panying the regulation will clearly in- dicate that it is being issued in accord- ance with paragraph (b)(1) of this sec- tion.

(c) Sole signature by Secretary of the Treasury. (1) Pursuant to Treasury De- partment Order No. 100–16, set forth in the appendix to this part, the Sec- retary of the Treasury reserves the right to promulgate regulations related to the customs revenue functions. Such regulations are signed by the Secretary of the Treasury (or his or her delegate) after consultation with the Secretary of Homeland Security (or his or her delegate), and are the official regula- tions of both Departments.

(2) When a regulation described in paragraph (c)(1) of this section is pub- lished in the FEDERAL REGISTER, the preamble of the document accom- panying the regulation will clearly in- dicate that the regulation is being issued in accordance with paragraph (c)(1) of this section.

[CBP Dec. 03–24, 68 FR 51869, Aug. 28, 2003, as amended at CBP Dec. 08-25, 73 FR 40724, July 16, 2008]

§ 0.2 All other CBP regulations issued under the authority of the Depart- ment of Homeland Security.

(a) The authority of the Secretary of the Treasury with respect to CBP regu- lations that are not related to customs revenue functions was transferred to the Secretary of Homeland Security pursuant to section 403(1) of the Home- land Security Act of 2002. Such regula- tions are signed by the Secretary of Homeland Security (or his or her dele- gate) and are the official regulations of the Department of Homeland Security.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00015 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

6

19 CFR Ch. I (4–1–12 Edition)Pt. 0, App.

(b) When a regulation described in paragraph (a) of this section is pub- lished in the FEDERAL REGISTER, the preamble accompanying the regulation shall clearly indicate that it is being issued in accordance with paragraph (a) of this section.

[CBP Dec. 03–24, 68 FR 51869, Aug. 28, 2003, as amended at CBP Dec. 08-25, 73 FR 40724, July 16, 2008]

APPENDIX TO 19 CFR PART 0—TREASURY DEPARTMENT ORDER NO. 100–16

Delegation from the Secretary of the Treasury to the Secretary of Homeland Se- curity of general authority over Customs revenue functions vested in the Secretary of the Treasury as set forth in the Homeland Security Act of 2002. Treasury Department, Washington, DC, May 15, 2003.

By virtue of the authority vested in me as the Secretary of the Treasury, including the authority vested by 31 U.S.C. 321(b) and sec- tion 412 of the Homeland Security Act of 2002 (Pub. L. 107–296) (Act), it is hereby ordered:

1. Consistent with the transfer of the func- tions, personnel, assets, and liabilities of the United States Customs Service to the De- partment of Homeland Security as set forth in section 403(1) of the Act, there is hereby delegated to the Secretary of Homeland Se- curity the authority related to the Customs revenue functions vested in the Secretary of the Treasury as set forth in sections 412 and 415 of the Act, subject to the following excep- tions and to paragraph 6 of this Delegation of Authority:

(a)(i) The Secretary of the Treasury re- tains the sole authority to approve any regu- lations concerning import quotas or trade bans, user fees, marking, labeling, copyright and trademark enforcement, and the comple- tion of entry or substance of entry summary including duty assessment and collection, classification, valuation, application of the U.S. Harmonized Tariff Schedules, eligibility or requirements for preferential trade pro- grams, and the establishment of record- keeping requirements relating thereto. The Secretary of Homeland Security shall pro- vide a copy of all regulations so approved to the Chairman and Ranking Member of the Committee on Ways and Means and the Chairman and Ranking Member of the Com- mittee on Finance every six months.

(ii) The Secretary of the Treasury shall re- tain the authority to review, modify, or re- voke any determination or ruling that falls within the criteria set forth in paragraph 1(a)(i), and that is under consideration pur- suant to the procedures set forth in sections 516 and 625(c) of the Tariff Act of 1930, as amended (19 U.S.C. 1516 and 1625(c)). The Sec-

retary of Homeland Security periodically shall identify and describe for the Secretary of the Treasury such determinations and rul- ings that are under consideration under sec- tions 516 and 625(c) of the Tariff Act of 1930, as amended, in an appropriate and timely manner, with consultation as necessary, prior to the Secretary of Homeland Secu- rity’s exercise of such authority. The Sec- retary of Homeland Security shall provide a copy of these identifications and descrip- tions so made to the Chairman and Ranking Member of the Committee on Ways and Means and the Chairman and Ranking Mem- ber of the Committee on Finance every six months. The Secretary of the Treasury shall list any case where Treasury modified or re- voked such a determination or ruling.

(b) Paragraph 1(a) notwithstanding, if the Secretary of Homeland Security finds an overriding, immediate, and extraordinary se- curity threat to public health and safety, the Secretary of Homeland Security may take action described in paragraph 1(a) without the prior approval of the Secretary of the Treasury. However, immediately after tak- ing any such action, the Secretary of Home- land Security shall certify in writing to the Secretary of the Treasury and to the Chair- man and Ranking Member of the Committee on Ways and Means and the Chairman and Ranking Member of the Committee on Fi- nance the specific reasons therefor. The ac- tion shall terminate within 14 days or as long as the overriding, immediate, and ex- traordinary security threat exists, whichever is shorter, unless the Secretary of the Treas- ury approves the continued action and pro- vides notice of such approval to the Sec- retary of Homeland Security.

(c) The Advisory Committee on Commer- cial Operations of the Customs Service (COAC) shall be jointly appointed by the Secretary of the Treasury and the Secretary of Homeland Security. Meetings of COAC shall be presided over jointly by the Sec- retary of the Treasury and the Secretary of Homeland Security. The COAC shall advise the Secretary of the Treasury and the Sec- retary of Homeland Security jointly.

2. Any references in this Delegation of Au- thority to the Secretary of the Treasury or the Secretary of Homeland Security are deemed to include their respective delegees, if any.

3. This Delegation of Authority is not in- tended to create or confer any right, privi- lege, or benefit on any private person, in- cluding any person in litigation with the United States.

4. Treasury Order No. 165–09, ‘‘Maintenance of delegation in respect to general authority over Customs Revenue functions vested in the Secretary of the Treasury, as set forth and defined in the Homeland Security Act of 2002,’’ dated February 28, 2003, is rescinded. To the extent this Delegation of Authority

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00016 Fmt 8010 Sfmt 8002 Q:\19\19V1.TXT ofr150 PsN: PC150

7

U.S. Customs and Border Protection, DHS; Treasury Pt. 4

requires any revocation of any other prior Order or Directive of the Secretary of the Treasury, such prior Order or Directive is hereby revoked.

5. This Delegation of Authority is effective May 15, 2003. This Delegation is subject to re- view on May 14, 2004. By March 15, 2004, the Secretary of the Treasury and the Secretary of Homeland Security shall consult with the Chairman and Ranking Member of the Com- mittee on Ways and Means and the Chairman and Ranking Member of the Committee on Finance to discuss the upcoming review of this Delegation.

6. The Secretary of the Treasury reserves the right to rescind or modify this Delega- tion of Authority, promulgate regulations, or exercise authority at any time based upon the statutory authority reserved to the Sec- retary by the Act. John W. Snow, Secretary of the Treasury.

PARTS 1–3 [RESERVED]

PART 4—VESSELS IN FOREIGN AND DOMESTIC TRADES

ARRIVAL AND ENTRY OF VESSELS

Sec. 4.0 General definitions. 4.1 Boarding of vessels; cutter and dock

passes. 4.2 Reports of arrival of vessels. 4.3 Vessels required to enter; place of entry. 4.3a Penalties for violation of vessel report-

ing and entry requirements. 4.4 Panama Canal; report of arrival re-

quired. 4.5 Government vessels. 4.6 Departure or unlading before report or

entry. 4.7 Inward foreign manifest; production on

demand; contents and form; advance fil- ing of cargo declaration.

4.7a Inward manifest; information required; alternative forms.

4.7b Electronic passenger and crew arrival manifests.

4.7c Vessel stow plan. 4.7d Container status messages. 4.8 Preliminary entry. 4.9 Formal entry. 4.10 Request for overtime services. 4.11 Sealing of stores. 4.12 Explanation of manifest discrepancy. 4.13 [Reserved] 4.14 Equipment purchases by, and repairs

to, American vessels. 4.15 Fishing vessels touching and trading at

foreign places. 4.16 [Reserved] 4.17 Vessels from discriminating countries.

TONNAGE TAX AND LIGHT MONEY

4.20 Tonnage taxes.

4.21 Exemptions from tonnage taxes. 4.22 Exemptions from special tonnage taxes. 4.23 Certificate of payment and cash re-

ceipt. 4.24 Application for refund of tonnage tax.

LANDING AND DELIVERY OF CARGO

4.30 Permits and special licenses for unlad- ing and lading.

4.31 Unlading or transshipment due to cas- ualty.

4.32 Vessels in distress, landing of cargo. 4.33 Diversion of cargo. 4.34 Prematurely discharged, overcarried,

and undelivered cargo. 4.35 Unlading outside port of entry. 4.36 Delayed discharge of cargo. 4.37 General order. 4.38 Release of cargo. 4.39 Stores and equipment of vessels and

crews’ effects; unlading or lading and re- tention on board.

4.40 Equipment, etc., from wrecked or dis- mantled vessels.

4.41 Cargo of wrecked vessel.

PASSENGERS ON VESSELS

4.50 Passenger lists. 4.51 Reporting requirements for individuals

arriving by vessel. 4.52 Penalties applicable to individuals.

FOREIGN CLEARANCES

4.60 Vessels required to clear. 4.61 Requirements for clearance. 4.62 Accounting for inward cargo. 4.63 Outward cargo declaration; shippers’

export declarations. 4.64 Electronic passenger and crew member

departure manifests. 4.65 Verification of nationality and ton-

nage. 4.65a Load lines. 4.66 Verification of inspection. 4.66a Illegal discharge of oil and hazardous

substances. 4.66b Pollution of coastal and navigable wa-

ters. 4.66c Oil pollution by oceangoing vessels. 4.67 Closed ports or places. 4.68 Federal Maritime Commission certifi-

cates for certain passengers vessels. 4.69 Shipping articles. 4.70 Public Health Service requirements. 4.71 Inspection of livestock. 4.72 Inspection of meat, meat-food products,

and inedible fats. 4.73 Neutrality; exportation of arms and

munitions. 4.74 Transportation orders. 4.75 Incomplete manifest; incomplete ex-

port declarations; bond. 4.76 Procedures and responsibilities of car-

riers filing outbound vessel manifest in- formation via the AES.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00017 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

8

19 CFR Ch. I (4–1–12 Edition)Pt. 4

COASTWISE PROCEDURE

4.80 Vessels entitled to engage in coastwise trade.

4.80a Coastwise transportation of pas- sengers.

4.80b Coastwise transportation of merchan- dise.

4.81 Reports of arrivals and departures in coastwise trade.

4.81a Certain barges carrying merchandise transferred from another barge.

4.82 Touching at foreign port while in coast- wise trade.

4.83 Trade between United States ports on the Great Lakes and other ports of the United States.

4.84 Trade with noncontiguous territory. 4.85 Vessels with residue cargo for domestic

ports. 4.86 Intercoastal residue—cargo procedure;

optional ports. 4.87 Vessels proceeding foreign via domestic

ports. 4.88 Vessels with residue cargo for foreign

ports. 4.89 Vessels in foreign trade proceeding via

domestic ports and touching at inter- mediate foreign ports.

4.90 Simultaneous vessel transactions. 4.91 Diversion of vessel; transshipment of

cargo. 4.92 Towing. 4.93 Coastwise transportation by certain

vessels of empty vans, tanks, and barges, equipment for use with vans and tanks; empty instruments of international traf- fic; stevedoring equipment and material; procedures.

GENERAL

4.94 Yacht privileges and obligations. 4.94a Large yachts imported for sale. 4.95 Records of entry and clearance of ves-

sels. 4.96 Fisheries. 4.97 Salvage vessels. 4.98 Navigation fees. 4.99 Forms; substitution. 4.100 Licensing of vessels of less than 30 net

tons. 4.101 Prohibitions against Customs officers

and employees.

AUTHORITY: 5 U.S.C. 301; 19 U.S.C. 66, 1431, 1433, 1434, 1624, 2071 note; 46 U.S.C. 501, 60105.

Section 4.1 also issued under 19 U.S.C. 1581(a); 46 U.S.C. 60101;

Section 4.2 also issued under 19 U.S.C. 1441, 1486;

Section 4.3 also issued under 19 U.S.C. 288, 1441;

Section 4.3a also issued under 19 U.S.C. 1433, 1436;

Section 4.5 also issued under 19 U.S.C. 1441; Section 4.7 also issued under 19 U.S.C.

1581(a);

Section 4.7a also issued under 19 U.S.C. 1498, 1584;

Section 4.7b also issued under 8 U.S.C. 1101, 1221;

Sections 4.7c and 4.7d also issued under 6 U.S.C. 943.

Section 4.8 also issued under 19 U.S.C. 1448, 1486;

Section 4.9 also issued under 42 U.S.C. 269; Section 4.10 also issued under 19 U.S.C.

1448, 1451; Section 4.12 also issued under 19 U.S.C.

1584; Section 4.14 also issued under 19 U.S.C.

1466, 1498; Section 4.20 also issued under 46 U.S.C.

2107(b), 8103, 14306, 14502, 14511–14513, 14701, 14702, 60301–60306, 60312;

Section 4.21 also issued under 19 U.S.C. 1441; 46 U.S.C. 60301–60310, 60312;

Section 4.22 also issued under 46 U.S.C. 60301, 60302, 60303, 60304, 60305, 60306, 60312, 60503;

Section 4.24 also issued under 46 U.S.C. 2108;

Section 4.30 also issued under 19 U.S.C. 288, 1446, 1448, 1450–1454, 1490;

Section 4.31 also issued under 19 U.S.C. 1453, 1586;

Section 4.32 also issued under 19 U.S.C. 1449;

Section 4.35 also issued under 19 U.S.C. 1447;

Section 4.36 also issued under 19 U.S.C. 1431, 1457, 1458; 46 U.S.C. 60107;

Section 4.37 also issued under 19 U.S.C. 1448, 1457, 1490;

Section 4.38 also issued under 19 U.S.C. 1448, 1505;

Section 4.39 also issued under 19 U.S.C. 1446;

Section 4.40 also issued under 19 U.S.C. 1446;

Section 4.50 also issued under 19 U.S.C. 1431; 46 U.S.C. 3502;

Section 4.51 also issued under 19 U.S.C. 1433;

Section 4.52 also issued under 19 U.S.C. 1433;

Section 4.61 also issued under 46 U.S.C. 12101, 12120, 12132, 55102, 55105–55108, 55110, 55115–55117, 55119;

Section 4.64 also issued under 8 U.S.C. 1221; Section 4.65a also issued under 46 U.S.C.

5101–5102, 5106–5109, 5112–5114, 5116; Section 4.66 also issued under 46 U.S.C.

60105; Section 4.66a also issued under 33 U.S.C.

1321; 46 U.S.C. 60105; Section 4.66b also issued under 33 U.S.C.

407, 1321; Section 4.68 also issued under 46 U.S.C.

44101–44106; Section 4.69 also issued under 46 U.S.C.

10301, 10302, 10314, and 10315. Section 4.74 also issued under 46 U.S.C.

60105;

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00018 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

9

U.S. Customs and Border Protection, DHS; Treasury § 4.0

Section 4.75 also issued under 46 U.S.C. 60105;

Sections 4.80, 4.80a, and 4.80b also issued under 19 U.S.C. 1706a; 28 U.S.C. 2461 note; 46 U.S.C. 12112, 12118, 50501–55106, 55107, 55108, 55110, 55114, 55115, 55116, 55117, 55119, 56101, 55121, 56101, 57109; Pub. L. 108–7, Division B, Title II, § 211;

Section 4.81 also issued under 19 U.S.C. 1442, 1486; 46 U.S.C. 12101, 12120, 12132, 55102, 55105–55108, 55110, 55114–55117, 55119;

Section 4.81a also issued under 46 U.S.C. 12101, 12120, 12132, 55102, 55105–55108, 55110, 55114–55117, 55119;

Section 4.82 also issued under 19 U.S.C. 293, 294; 46 U.S.C. 60308;

Section 4.83 also issued under 46 U.S.C. 60105, 60308;

Section 4.84 also issued under 46 U.S.C. 12118;

Section 4.85 also issued under 19 U.S.C. 1442, 1623;

Section 4.86 also issued under 19 U.S.C. 1442;

Section 4.88 also issued under 19 U.S.C. 1442, 1622, 1623;

Section 4.92 also issued under 28 U.S.C. 2461 note; 46 U.S.C. 55111;

Section 4.93 also issued under 19 U.S.C. 1322(a); 46 U.S.C. 12101, 12120, 12132, 55102, 55105–55108, 55110, 55114–55117, 55119;

Section 4.94 also issued under 19 U.S.C. 1441; 46 U.S.C. 60504;

Section 4.94a also issued under 19 U.S.C. 1484b;

Section 4.96 also issued under 46 U.S.C. 12101(a)(1), 12108, 55114;

Section 4.98 also issued under 31 U.S.C. 9701;

Section 4.100 also issued under 19 U.S.C. 1706.

EFFECTIVE DATE NOTE: At 77 FR 17332, Mar. 26, 2012, the authority citation was amended by adding a citation for section 4.14, effective Apr. 25, 2012. For the convenience of the user, the added text is set forth as follows:

AUTHORITY: 5 U.S.C. 301; 19 U.S.C. 66, 1431, 1433, 1434, 1624, 2071 note; 46 U.S.C. 501, 60105.

* * * * * Section 4.14 also issued under 19 U.S.C.

1466, 1498; 31 U.S.C. 9701. * * * * *

SOURCE: 28 FR 14596, Dec. 31, 1963, unless otherwise noted.

ARRIVAL AND ENTRY OF VESSELS

§ 4.0 General definitions. For the purposes of this part: (a) Vessel. The word vessel includes

every description of water craft or other contrivance used or capable of being used as a means of transpor- tation on water, but does not include aircraft. (19 U.S.C. 1401.)

(b) Vessel of the United States. The term vessel of the United States means any vessel documented under the laws of the United States.

(c) Documented. The term documented vessel means a vessel for which a valid Certificate of Documentation, form CG 1270, issued by the U.S. Coast Guard is outstanding. Upon qualification and proper application to the appropriate Coast Guard office, the Certificate of Documentation may be endorsed with a: (1) Registry endorsement (generally, available to a vessel to be employed in foreign trade, trade with Guam, Amer- ican Samoa, Wake, Midway, or King- man Reef, and other employments for which another endorsement is not re- quired), (2) coastwise endorsement (generally, entitles a vessel to employ- ment in the coastwise trade, and other employments for which another en- dorsement is not required), (3) fishery endorsement (generally, subject to fed- eral and state laws regulating the fish- eries, entitles a vessel to fish within the Exclusive Economic Zone (16 U.S.C. 1811) and landward of that zone and to land its catch) or (4) recreational en- dorsement (entitles a vessel to rec- reational use only). Any other termi- nology used elsewhere in this part to describe the particular documentation of a vessel shall be read as synonymous with the applicable terminology con- tained in this paragraph. Generally, any vessel of at least 5 net tons and wholly owned by a United States cit- izen or citizens is eligible for docu- mentation except that for a coastwise, or fisheries endorsement a vessel must also be built in the United States. De- tailed Coast Guard regulations on doc- umentation are set forth in Title 46, Code of Federal Regulations, § 67.01– 67.45.

(d) Noncontiguous territory of the United States. The term noncontiguous territory of the United States includes all the island territories and possessions of the United States, but does not include the Canal Zone.

(e) Citizen. The word citizen is as de- fined by the U.S. Coast Guard for pur- poses of vessel documentation (see sub- part 67.03 of title 46, Code of Federal Regulations.)

(f) Arrival of a vessel. The phrase ‘‘ar- rival of a vessel’’ means that time

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00019 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

10

19 CFR Ch. I (4–1–12 Edition)§ 4.1

1-27 [Reserved]

when the vessel first comes to rest, whether at anchor or at a dock, in any harbor within the Customs territory of the U.S.

(g) Departure of a vessel. The phrase ‘‘departure of a vessel’’ means that time when the vessel gets under way on its outward voyage and proceeds on the voyage without thereafter coming to rest in the harbor from which it is going.

[T.D. 69–266, 34 FR 20422, Dec. 31, 1969, as amended by T.D. 83–214, 48 FR 46511, Oct. 13, 1983; T.D. 93–78, 58 FR 50256, Sept. 27, 1993; T.D. 93–96, 58 FR 67315, Dec. 21, 1993; CBP Dec. 08-25, 73 FR 40725, July 16, 2008]

§ 4.1 Boarding of vessels; cutter and dock passes.

(a) Every vessel arriving at a Cus- toms port will be subject to such super- vision while in port as the port director considers necessary. The port director may detail Customs officers to remain on board a vessel to secure enforce- ment of the requirements set forth in this part. Customs may determine to board as many vessels as considered necessary to ensure compliance with the laws it enforces.

(b)(1) No person, with or without the consent of the master, except a pilot in connection with the navigation of the vessel, personnel from another vessel in connection with the navigation of an unmanned barge, an officer of Customs or the Coast Guard, an immigration or health officer, an inspector of the Ani- mal and Plant Health Inspection Serv- ice of the U.S. Department of Agri- culture, or an agent of the vessel or consular officer exclusively for pur- poses relating to Customs formalities, shall go on board any vessel arriving from outside the Customs territory of the United States without permission of the port director or the Customs of- ficer in charge until the vessel has been taken in charge by a Customs officer.

(2) A person may leave the vessel for the purpose of reporting its arrival as required by law (see § 4.2), but no other person, except those designated in paragraph (b)(1) of this section, shall leave any vessel arriving from outside the Customs territory of the United States, with or without the consent of

the master, without the permission of the port director or the Customs officer in charge until the vessel has been properly inspected by Customs and brought into the dock or anchorage at which cargo is to be unladen and until all passengers have been landed from the vessel (19 U.S.C. 1433).

(3) Every person permitted to go on board or to leave without the consent of a Customs officer under the provi- sions of this paragraph shall be subject to Customs and quarantine regula- tions.

(4) The master of any vessel shall not authorize the boarding or leaving of his vessel by any person in violation of this paragraph.

(c) A port director, in his discretion may issue a cutter pass on Customs Form 3093 to permit the holder to board an incoming vessel after it has been inspected by the quarantine au- thorities and taken in charge by an of- ficer of the Customs, as follows: (1) To persons on official business; (2) to news reporters, newspaper photographers, photographers of established motionpicture companies, and broad- casters of established radio broad- casting cmmpanies; and (3) in cases of special exigency in which the port di- rector is satisfied as to the urgent need for the boarding and that its allowance will not result in undue interference with the performance of official busi- ness.

(d) No person in charge of a tugboat, rowboat, or other vessel shall bring such conveyance alongside an incoming vessel heretofore described and put on board thereof any person, except as au- thorized by law or regulations.

(e) [Reserved] (f) Term cutter and dock passes, for a

period of not to exceed one year, may be issued in the discretion of the port director, to persons on official business and to duly accredited news reporters and newspaper photographers. Passes are not transferable and shall be for- feited upon presentation by others than those to whom issued.

[28 FR 14596, Dec. 31, 1963, as amended by T.D. 78–141, 43 FR 22174, May 24, 1978; T.D. 82– 224, 47 FR 35475, Aug. 16, 1982; T.D. 92–74, 57 FR 35751, Aug. 11, 1992; T.D. 95–77, 60 FR 50010, Sept. 27, 1995; T.D. 00–4, 65 FR 2872, Jan. 19, 2000]

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00020 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

11

U.S. Customs and Border Protection, DHS; Treasury § 4.3

§ 4.2 Reports of arrival of vessels. (a) Upon arrival in any port or place

within the U.S., including, for purposes of this section, the U.S. Virgin Islands, of any vessel from a foreign port or place, any foreign vessel from a port or place within the U.S., or any vessel of the U.S. carrying foreign merchandise for which entry has not been made, the master of the vessel must immediately report that arrival to the nearest CBP facility or other location designated by the port director. The report of arrival, except as supplemented in local in- structions issued by the port director and made available to interested par- ties by posting in CBP offices, publica- tion in a newspaper of general circula- tion, and other appropriate means, may be made by any means of commu- nication to the port director or to a CBP officer assigned to board the ves- sel. The CBP officer may require the production of any documents or papers deemed necessary for the proper in- spection/examination of the vessel, cargo, passenger, or crew.

(b) For purposes of this part, ‘‘foreign port or place’’ includes a hovering ves- sel, as defined in 19 U.S.C. 1401(k), and any point in customs waters beyond the territorial sea or on the high seas at which a vessel arriving in a port or place in the U.S. has received merchan- dise.

(c) In the case of certain vessels ar- riving either in distress or for the lim- ited purpose of taking on certain sup- plies and departing within a 24-hour time period without having landed or taken on any passengers or other mer- chandise (see section 441(4), Tariff Act of 1930, as amended), the report must be filed by either the master, owner, or agent, and must be in the form and give the information required by that statute, except that the report need not be under oath. A derelict vessel will be considered one in distress and any person bringing it into port must report its arrival.

(d) The report of baggage and mer- chandise required to be made by cer- tain passenger vessels making three or more trips a week between U.S. and foreign ports and vessels used exclu- sively as ferryboats carrying pas- sengers, baggage, or merchandise (see section 441(2), Tariff Act of 1930, as

amended), is in addition to the required report of arrival, and must be made within 24 hours of arrival.

[T.D. 93–96, 58 FR 67315, Dec. 21, 1993, as amended by T.D. 94–44, 59 FR 23795, May 9, 1994; CBP Dec. 10–33, 75 FR 69585, Nov. 15, 2010]

§ 4.3 Vessels required to enter; place of entry.

(a) Formal entry required. Unless spe- cifically excepted by law, within 48 hours after the arrival at any port or place in the United States, the fol- lowing vessels are required to make formal entry:

(1) Any vessel from a foreign port or place;

(2) Any foreign vessel from a domes- tic port;

(3) Any vessel of the United States having foreign merchandise on board for which entry has not been made; or

(4) Any vessel which has visited a hovering vessel as defined in 19 U.S.C. 1401(k), or has delivered or received merchandise or passengers while out- side the territorial sea.

(b) Completion of entry. (1) When ves- sel entry is to be made at the custom- house, either the master, licensed deck officer, or purser may appear in person during regular working hours to com- plete preliminary or formal vessel entry; or necessary documents properly executed by the master or other au- thorized officer may be delivered at the customhouse by the vessel agent or other personal representative of the master.

(2) The appropriate CBP port director may permit the entry of vessels to be accomplished at locations other than the customhouse, and services may be requested outside of normal business hours. CBP may take local resources into consideration in allowing formal entry to be transacted on board vessels or at other mutually convenient ap- proved sites and times within or out- side of port limits. When services are requested to be provided outside the limits of a CBP port, the appropriate port director to whom an application must be submitted is the director of the port located nearest to the point where the proposed services would be provided. That port director must be satisfied that the place designated for

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00021 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

12

19 CFR Ch. I (4–1–12 Edition)§ 4.3a

formal entry will be sufficiently under CBP control at the time of entry, and that the expenses incurred by CBP will be reimbursed as authorized. It may be required that advance notice of vessel arrival be given as a condition for granting requests for optional entry lo- cations. A master, owner, or agent of a vessel who desires that entry be made at an optional location will file with the appropriate port director an appli- cation on CBP Form 3171 and a single entry or continuous bond on CBP Form 301 containing the bond conditions set forth in § 113.64 of this chapter, in such amount as that port director deems ap- propriate but not less than $1,000. If the application is approved, the port direc- tor or a designated CBP officer will for- mally enter the vessel. Nothing in this paragraph relieves any person or vessel from any requirement as to how, when and where they are to report, be in- spected or receive clearance from other Federal agencies upon arrival in the United States.

[T.D. 00–4, 65 FR 2872, Jan. 19, 2000, as amend- ed at CBP Dec. 10–33, 75 FR 69585, Nov. 15, 2010]

§ 4.3a Penalties for violation of vessel reporting and entry requirements.

Violation of the arrival or entry re- porting requirements provided for in this part may result in the master being liable for certain civil and crimi- nal penalties, as provided under 19 U.S.C. 1436, in addition to other pen- alties applicable under other provisions of law. The penalties include civil mon- etary penalties for failure to report ar- rival or make entry, and any convey- ance used in connection with any such violation is subject to seizure and for- feiture. Further, if any merchandise (other than sea stores or the equivalent for conveyances other than a vessel) is involved in the failure to report arrival or entry, additional penalties equal to the value of merchandise may be im- posed, and the merchandise may be seized and forfeited unless properly en- tered by the importer or consignee. The criminal penalties, applicable upon conviction, include fines and imprison- ment if the master intentionally com- mits any violation of these reporting and entry requirements or if prohibited

merchandise is involved in the failure to report arrival or make entry.

[T.D. 93–96, 58 FR 67316, Dec. 21, 1993]

§ 4.4 Panama Canal; report of arrival required.

Vessels which merely transit the Panama Canal without transacting any business there shall be required to re- port their arrival because of such tran- sit. The report of arrival shall be made in accordance with § 4.2(a).

[T.D. 79–276, 44 FR 61956, Oct. 29, 1979]

§ 4.5 Government vessels. (a) No report of arrival or entry shall

be required of any vessel owned by, or under the complete control and man- agement of the United States or any of its agencies, if such vessel is manned wholly by members of the uniformed services of the United States, by per- sonnel in the civil service of the United States, or by both, and is transporting only property of the United States or passengers traveling on official busi- ness of the United States, or it is bal- last. In addition, any vessel chartered by, and transporting only cargo that is the property of, the U.S. Department of Defense (DoD) will be treated as a Gov- ernment vessel for the purpose of being exempt from entry, where the DoD- chartered vessel is manned entirely by the civilian crew of the vessel carrier under contract to DoD. Notwith- standing § 4.60(b)(3) of this part, such DoD-chartered vessel is not exempt from vessel clearance requirements. However, if any cargo is on board, the master or commander of each such ves- sel arriving from abroad shall file a Cargo Declaration, Customs Form 1302, or an equivalent form issued by the De- partment of Defense, in duplicate. The original of each Cargo Declaration or equivalent form required under this paragraph shall be filed with the port director within 48 hours after the ar- rival of the vessel. The other copy shall be made available for use by the dis- charging inspector at the pier. See § 148.73 of this chapter with respect to baggage on carriers operated by the Department of Defense.

(b) The arrival of every vessel owned or controlled and manned as described in paragraph (a) of this section but

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00022 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

13

U.S. Customs and Border Protection, DHS; Treasury § 4.7

transporting other property or pas- sengers, and every vessel so owned or controlled but not so manned, whether in ballast or transporting cargo or pas- sengers, shall be reported in accord- ance with § 4.2 and the vessel shall be entered in accordance with § 4.9.

(c) Every vessel owned by, or under the complete control and management of, any foreign nation shall be exempt from or subject to the laws relating to report of arrival and entry under the same conditions as a vessel owned or controlled by the United States.

[28 FR 14596, Dec. 31, 1963, as amended by 39 FR 10897, Mar. 22, 1974; T.D. 83–213, 48 FR 46978, Oct. 17, 1983; CBP Dec. 03–32, 68 FR 68168, Dec. 5, 2003]

§ 4.6 Departure or unlading before re- port or entry.

(a) No vessel which has arrived with- in the limits of any Customs port from a foreign port or place shall depart or attempt to depart, except from stress of weather or other necessity, without reporting and making entry as required in this part. These requirements shall not apply to vessels merely passing through waters within the limits of a Customs port in the ordinary course of a voyage.

(b) The ‘‘limits of any Customs port’’ as used herein are those described in § 101.3(b) of this chapter, including the marginal waters to the 3-mile limit on the seaboard and the waters to the boundary line on the northern and southern boundaries.

(c) Violation of this provision may result in the master being liable for certain civil penalties and the vessel to arrest and forfeiture, as provided under 19 U.S.C. 1436, in addition to other pen- alties applicable under other provisions of law.

[T.D. 93–96, 58 FR 67316, Dec. 21, 1993, as amended by T.D. 98–74, 63 FR 51287, Sept. 25, 1998]

§ 4.7 Inward foreign manifest; produc- tion on demand; contents and form; advance filing of cargo declaration.

(a) The master of every vessel arriv- ing in the United States and required to make entry shall have on board his vessel a manifest, as required by sec- tion 431, Tariff Act of 1930 (19 U.S.C. 1431), and by this section. The manifest

shall be legible and complete. If it is in a foreign language, an English trans- lation shall be furnished with the origi- nal and with any required copies. The manifest shall consist of a Vessel En- trance or Clearance Statement, CBP Form 1300, and the following docu- ments: (1) Cargo Declaration, CBP Form 1302, (2) Ship’s Stores Declara- tion, CBP Form 1303, (3) Crew’s Effects Declaration, CBP Form 1304, or, op- tionally, a copy of the Crew List, Cus- toms and Immigration Form I–418, to which are attached crewmember’s dec- larations on CBP Form 5129, (4) Crew List, Customs and Immigration Form I–418, and (5) Passenger List, Customs and Immigration Form I–418. Any doc- ument which is not required may be omitted from the manifest provided the word ‘‘None’’ is inserted in items 16, 18, and/or 19 of the Vessel Entrance or Clearance Statement, as appro- priate. If a vessel arrives in ballast and therefore the Cargo Declaration is omitted, the legend ‘‘No merchandise on board’’ shall be inserted in item 16 of the Vessel Entrance or Clearance Statment.

(b)(1) With the exception of any Cargo Declaration that has been filed in advance as prescribed in paragraph (b)(2) of this section, the original and one copy of the manifest must be ready for production on demand. The master shall deliver the original and one copy of the manifest to the CBP officer who shall first demand it. If the vessel is to proceed from the port of arrival to other United States ports with residue foreign cargo or passengers, an addi- tional copy of the manifest shall be available for certification as a trav- eling manifest (see § 4.85). The port di- rector may require an additional copy or additional copies of the manifest, but a reasonable time shall be allowed for the preparation of any copy which may be required in addition to the original and one copy.

(2) In addition to the vessel stow plan requirements pursuant to § 4.7c of this part and the container status message requirements pursuant to § 4.7d of this part, and with the exception of any bulk or authorized break bulk cargo as prescribed in paragraph (b)(4) of this

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00023 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

14

19 CFR Ch. I (4–1–12 Edition)§ 4.7

section, Customs and Border Protec- tion (CBP) must receive from the in- coming carrier, for any vessel covered under paragraph (a) of this section, the CBP-approved electronic equivalent of the vessel’s Cargo Declaration (CBP Form 1302), 24 hours before the cargo is laden aboard the vessel at the foreign port (see § 4.30(n)). The electronic cargo declaration information must be trans- mitted through the CBP Automated Manifest System (AMS) or any elec- tronic data interchange system ap- proved by CBP to replace the AMS sys- tem for this purpose. Any such system change will be announced by notice in the Federal Register.

(3)(i) Where a non-vessel operating common carrier (NVOCC), as defined in paragraph (b)(3)(ii) of this section, de- livers cargo to the vessel carrier for lading aboard the vessel at the foreign port, the NVOCC, if licensed by or reg- istered with the Federal Maritime Commission and in possession of an International Carrier Bond containing the provisions of § 113.64 of this chap- ter, may electronically transmit the corresponding required cargo declara- tion information directly to CBP through the vessel AMS system (or other system approved by CBP for this purpose). The information must be re- ceived 24 or more hours before the re- lated cargo is laden aboard the vessel at the foreign port (see § 113.64(c) of this chapter), as provided in paragraph (b)(2) of this section, or in accordance with paragraph (b)(4) of this section ap- plicable to exempted bulk and break bulk cargo. In the alternative, the NVOCC must fully disclose and present the required cargo declaration infor- mation for the related cargo to the ves- sel carrier which is required to present this information to CBP, in accordance with this section, via the vessel AMS system (or other CBP-approved sys- tem).

(ii) A non-vessel operating common carrier (NVOCC) means a common car- rier that does not operate the vessels by which the ocean transportation is provided, and is a shipper in its rela- tionship with an ocean common car- rier. The term ‘‘non-vessel operating common carrier’’ does not include freight forwarders as defined in part 112 of this chapter.

(iii) Where the party electronically presenting to CBP the cargo informa- tion required in § 4.7a(c)(4) receives any of this information from another party, CBP will take into consideration how, in accordance with ordinary commer- cial practices, the presenting party ac- quired such information, and whether and how the presenting party is able to verify this information. Where the pre- senting party is not reasonably able to verify such information, CBP will per- mit the party to electronically present the information on the basis of what the party reasonably believes to be true.

(4) Carriers of bulk cargo as specified in paragraph (b)(4)(i) of this section and carriers of break bulk cargo to the extent provided in paragraph (b)

(i) Bulk cargo is defined for purposes of this section as homogeneous cargo that is stowed loose in the hold and is not enclosed in any container such as a box, bale, bag, cask, or the like. Such cargo is also described as bulk freight. Specifically, bulk cargo is composed of either:

(A) Free flowing articles such as oil, grain, coal, ore, and the like, which can be pumped or run through a chute or handled by dumping; or

(B) Articles that require mechanical handling such as bricks, pig iron, lum- ber, steel beams, and the like.

(ii) A carrier of break bulk cargo may apply for an exemption from the filing requirement of paragraph (b)(2) of this section with respect to the break bulk cargo it will be transporting. For pur- poses of this section, break bulk cargo is cargo that is not containerized, but which is otherwise packaged or bun- dled.

(A) To apply for an exemption, the carrier must submit a written request for exemption to the U.S. Customs and Border Protection, National Targeting Center, 1300 Pennsylvania Ave., NW., Washington, DC 20229. Until an applica- tion for an exemption is granted, the carrier must comply with the 24 hour advance cargo declaration requirement set out in paragraph (b)(2) of this sec- tion. The written request for exemp- tion must clearly set forth information such that CBP may assess whether any security concerns exist, such as: The

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00024 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

15

U.S. Customs and Border Protection, DHS; Treasury § 4.7

carrier’s IRS number; the source, iden- tity and means of the packaging or bundling of the commodities being shipped; the ports of call, both foreign and domestic; the number of vessels the carrier uses to transport break bulk cargo, along with the names of these vessels and their International Maritime Organization numbers; and the list of the carrier’s importers and shippers, identifying any who are mem- bers of C-TPAT (The Customs-Trade Partnership Against Terrorism).

(B) CBP will evaluate each applica- tion for an exemption on a case by case basis. If CBP, by written response, pro- vides an exemption to a break bulk carrier, the exemption is only applica- ble under the circumstances clearly set forth in the application for exemption. If circumstances set forth in the ap- proved application change, it will be necessary to submit a new application.

(C) CBP may rescind an exemption granted to a carrier at any time.

(c) No Passenger List or Crew List shall be required in the case of a vessel arriving from Canada, otherwise than by sea, at a port on the Great Lakes or their connecting or tributary waters.

(d)(1) The master or owner of— (i) A vessel documented under the

laws of the United States with a reg- istry, coastwise license, or Great Lakes license endorsement, or a vessel not so documented but intended to be em- ployed in the foreign, coastwise, or Great Lakes trade, or

(ii) A documented vessel with a fish- ery license endorsement which has a permit to touch and trade (see § 4.15) or a vessel with a fishery license endorse- ment lacking a permit to touch and trade but intended to engage in trade— at the port of first arrival from a for- eign country shall declare on CBP Form 226 any equipment, repair parts, or materials purchased for the vessel, or any expense for repairs incurred, outside the United States, within the purview of section 466, Tariff Act of 1930, as amended (19 U.S.C. 1466). If no equipment, repair parts, or materials have been purchased, or repairs made, a declaration to that effect shall be made on CBP Form 226.

(2) If the vessel is at least 500 gross tons, the declaration shall include a statement that no work in the nature

of a rebuilding or alteration which might give rise to a reasonable belief that the vessel may have been rebuilt within the meaning of the second pro- viso to section 27, Merchant Marine Act, 1920, as amended (46 U.S.C. 883), has been effected which has not been either previously reported or sepa- rately reported simultaneously with the filing of such declaration. The port director shall notify the U.S. Coast Guard vessel documentation officer at the home port of the vessel of any work in the nature of a rebuilding or alter- ation, including the construction of any major component of the hull or su- perstructure of the vessel, which comes to his attention unless the port direc- tor is satisfied that the owner of the vessel has filed an application for re- built determination as required by 46 CFR 67.27–3.

(3) The declaration shall be ready for production on demand for inspection and shall be presented as part of the original manifest when formal entry of the vessel is made.

(e) Failure to provide manifest informa- tion; penalties/liquidated damages. Any master who fails to provide manifest information as required by this sec- tion, or who presents or transmits elec- tronically any document required by this section that is forged, altered or false, or who fails to present or trans- mit the information required by this section in a timely manner, may be lia- ble for civil penalties as provided under 19 U.S.C. 1436, in addition to damages under the international carrier bond of $5,000 for each violation discovered. In addition, if any non-vessel operating common carrier (NVOCC) as defined in paragraph (b)(3)(ii) of this section elects to transmit cargo declaration in- formation to CBP electronically and fails to do so in the manner and in the time period required by paragraph (b)(3)(i) of this section, or electroni- cally transmits any false, forged or al- tered document, paper, cargo declara- tion information to CBP, such NVOCC may be liable for the payment of liq- uidated damages as provided in

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00025 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

16

19 CFR Ch. I (4–1–12 Edition)§ 4.7a

§ 113.64(c) of this chapter, of $5,000 for each violation discovered.

[T.D. 71–169, 36 FR 12602, July 2, 1971, as amended by T.D. 74–284, 39 FR 39718, Nov. 11, 1974; T.D. 77–255, 42 FR 56319, Oct. 25, 1977; T.D. 80–237, 45 FR 64565, Sept. 30, 1980; T.D. 83–214, 48 FR 46511, Oct. 13, 1983; T.D. 92–74, 57 FR 35751, Aug. 11, 1992; T.D. 00–22, 65 FR 16515, Mar. 29, 2000; T.D. 02–62, 67 FR 66331, Oct. 31, 2002; 68 FR 1801, Jan. 14, 2003; CBP Dec. 03–32, 68 FR 68168, Dec. 5, 2003; CBP Dec. 08–46, 73 FR 71779, Nov. 25, 2008; CBP Dec. 09– 39, 74 FR 52676, Oct. 14, 2009; CBP Dec. 11–10, 76 FR 27608, May 12, 2011]

§ 4.7a Inward manifest; information re- quired; alternative forms.

The forms designated by § 4.7(a) as comprising the inward manifest shall be completed as follows:

(a) Ship’s Stores Declaration. Articles to be retained aboard as sea or ship’s stores shall be listed on the Ship’s Stores Declaration, CBP Form 1303. Less than whole packages of sea or ship’s stores may be described as ‘‘sun- dry small and broken stores.’’

(b) Crew’s Effects Declaration. (CBP Form 1304). (1) The declaration number of the Crew Member’s Declaration, CBP Form 5129, prepared and signed by any officer or crewmember who intends to land articles in the United States, or the word ‘‘None,’’ shall be shown in item No. 7 on the Crew’s Effects Dec- laration, CBP Form 1304 opposite the respective crewmember’s name.

(2) In lieu of describing the articles on CBP Form 1304, the master may fur- nish a Crew List, CBP Form I–418, en- dorsed as follows:

I certify that this list, with its supporting crewmembers’ declarations, is a true and complete manifest of all articles on board the vessel acquired abroad by myself and the officers and crewmembers of this vessel, other than articles exclusively for use on the voyage or which have been duly cleared through CBP in the United States.

———————————— (Master.)

The Crew List on Form I–418 shall show, opposite the crewmember’s name, his shipping article number and, in column 5, the declaration number. If the crewmember has nothing to de- clare, the word ‘‘None’’ shall be placed opposite his name instead of a declara- tion number.

(3) For requirements concerning the preparation of CBP Form 5129, see sub- part G of part 148 of this chapter.

(4) Any articles which are required to be manifested and are not manifested shall be subject to forfeiture and the master shall be subjected to a penalty equal to the value thereof, as provided in section 584, Tariff Act of 1930, as amended.

(c) Cargo Declaration. (1) The Cargo Declaration (CBP Form 1302 submitted in accordance with paragraph (b)(2) or (b)(4) of this section) must list all the inward foreign cargo on board the ves- sel regardless of the U.S. port of dis- charge, and must separately list any other foreign cargo remaining on board (‘‘FROB’’). For the purposes of this part, ‘‘FROB’’ means cargo which is laden in a foreign port, is intended for discharge in a foreign port, and re- mains aboard a vessel during either di- rect or indirect stops at one or more intervening United States ports. The block designated ‘‘Arrival’’ at the top of the form shall be checked. The name of the shipper shall be set forth in the column calling for such information and on the same line where the bill of lading is listed for that shipper’s mer- chandise. When more than one bill of lading is listed for merchandise from the same shipper, ditto marks or the word ‘‘ditto’’ may be used to indicate the same shipper. The cargo described in column Nos. 6 and 7, and either col- umn No. 8 or 9, shall refer to the re- spective bills of lading. Either column No. 8 or column No. 9 shall be used, as appropriate. The gross weight in col- umn No. 8 shall be expressed in either pounds or kilograms. The measurement in column No. 9 shall be expressed ac- cording to the unit of measure speci- fied in the Harmonized Tariff Schedule of the United States (HTSUS) (19 U.S.C. 1202).

(2)(i) When inward foreign cargo is being shipped by container, each bill of lading shall be listed in the column headed ‘‘B/L Nr.’’ in numerical se- quence according to the bill of lading number. The number of the container which contains the cargo covered by that bill of lading and the number of the container seal shall be listed in col- umn No. 6 opposite the bill of lading number. The number of any other bill

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00026 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

17

U.S. Customs and Border Protection, DHS; Treasury § 4.7a

of lading for cargo in that container also shall be listed in column No. 6 im- mediately under the container and seal numbers. A description of the cargo shall be set forth in column No. 7 only if the covering bill of lading is listed in the column headed ‘‘B/L Nr.’’

(ii) As an alternative to the proce- dure described in paragraph (i), a sepa- rate list of the bills of lading covering each container on the vessel may be submitted on CBP Form 1302 or on a separate sheet. If this procedure is used:

(A) Each container number shall be listed in alphanumeric sequence by port of discharge in column No. 6 of CBP Form 1302, or on the separate sheet; and

(B) The number of each bill of lading covering cargo in a particular con- tainer, identifying the port of lading, shall be listed opposite the number of the container with that cargo in the column headed ‘‘B/L Nr.’’ if CBP Form 1302 is used, or either opposite or under the number of the container if a sepa- rate sheet is used.

(iii) All bills of lading, whether issued by a carrier, freight forwarder, or other issuer, shall contain a unique identifier consisting of up to 16 char- acters in length. The unique bill of lad- ing number will be composed of two elements. The first element will be the first four characters consisting of the carrier or issuer’s four digit Standard Carrier Alpha Code (SCAC) assigned to the carrier in the National Motor Freight Traffic Association, Inc., Di- rectory of Standard Multi-Modal Car- rier and Tariff Agent Codes, applicable supplements thereto and reissues thereof. The second element may be up to 12 characters in length and may be either alpha and/or numeric. The unique identifier shall not be used by the carrier, freight forwarder or issuer for another bill of lading for a period of 3 years after issuance. CBP processing of the unique identifier will be limited to checking the validity of the Stand- ard Carrier Alpha Codes (SCAC) and en- suring that the identifier has not been duplicated within a 3-year period. Car- riers and broker/importers will be re- sponsible for reconciliation of discrep- ancies between cargo declarations and entries. CBP will not perform any rec-

onciliation except in a post-audit proc- ess.

(3) For shipment of containerized or palletized cargo, CBP officers shall ac- cept a Cargo Declaration which indi- cates that it has been prepared on the basis of information furnished by the shipper. The use of words of qualifica- tion shall not limit the responsibility of a master to submit accurate Cargo Declarations or qualify the oath taken by the master as to the accuracy of his declaration.

(i) If Cargo Declaration covers only containerized or palletized cargo, the following statement may be placed on the declaration:

The information appearing on the declara- tion relating to the quantity and description of the cargo is in each instance based on the shipper’s load and count. I have no knowl- edge or information which would lead me to believe or to suspect that the information furnished by the shipper is incomplete, inac- curate, or false in any way.

(ii) If the Cargo Declaration covers conventional cargo and containerized or palletized cargo, or both, the use of the abbreviation ‘‘SLAC’’ for ‘‘ship- per’s load and count,’’ or an appro- priate abbreviation if similar words are used, is approved: Provided, That abbre- viation is placed next to each contain- erized or palletized shipment on the declaration and the following state- ment is placed on the delaration:

The information appearing on this declara- tion relating to the quantity and description of cargo preceded by the abbreviation ‘‘SLAC’’ is in each instance based on the shipper’s load and count. I have no informa- tion which would lead me to believe or to suspect that the information furnished by the shipper is incomplete, inaccurate, or false in any way.

(iii) The statements specified in para- graphs (c)(3) (i) and (ii) of this section shall be placed on the last page of the Cargo Declaration. Words similar to ‘‘the shipper’s load and count’’ may be substituted for those words in the statements. Vague expressions such as ‘‘said to contain’’ or ‘‘accepted as con- taining’’ are not acceptable. The use of an asterisk or other character instead of appropriate abbreviations, such as ‘‘SLAC’’, is not acceptable.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00027 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

18

19 CFR Ch. I (4–1–12 Edition)§ 4.7a

(4) In addition to the cargo declara- tion information required in para- graphs (c)(1)–(c)(3) of this section, for all inward foreign cargo, the Cargo Declaration, must state the following:

(i) The last foreign port before the vessel departs for the United States;

(ii) The carrier SCAC code (the unique Standard Carrier Alpha Code assigned for each carrier; see paragraph (c)(2)(iii) of this section);

(iii) The carrier-assigned voyage number;

(iv) The date the vessel is scheduled to arrive at the first U.S. port in CBP territory;

(v) The numbers and quantities from the carrier’s ocean bills of lading, ei- ther master or house, as applicable (this means that the carrier must transmit the quantity of the lowest ex- ternal packaging unit; containers and pallets are not acceptable manifested quantities; for example, a container containing 10 pallets with 200 cartons should be manifested as 200 cartons);

(vi) The first foreign port where the carrier takes possession of the cargo destined to the United States;

(vii) A precise description (or the Harmonized Tariff Schedule (HTS) numbers to the 6-digit level under which the cargo is classified if that in- formation is received from the shipper) and weight of the cargo or, for a sealed container, the shipper’s declared de- scription and weight of the cargo. Ge- neric descriptions, specifically those such as ‘‘FAK’’ (‘‘freight of all kinds’’), ‘‘general cargo’’, and ‘‘STC’’ (‘‘said to contain’’) are not acceptable;

(viii) The shipper’s complete name and address, or identification number, from all bills of lading. (At the master bill level, for consolidated shipments, the identity of the Non Vessel Oper- ating Common Carrier (NVOCC), freight forwarder, container station or other carrier is sufficient; for non-con- solidated shipments, and for each house bill in a consolidated shipment, the identity of the foreign vendor, sup- plier, manufacturer, or other similar party is acceptable (and the address of the foreign vendor, etc., must be a for- eign address); by contrast, the identity of the carrier, NVOCC, freight for- warder or consolidator is not accept- able; the identification number will be

a unique number assigned by CBP upon the implementation of the Automated Commercial Environment);

(ix) The complete name and address of the consignee, or identification number, from all bills of lading. (For consolidated shipments, at the master bill level, the NVOCC, freight for- warder, container station or other car- rier may be listed as the consignee. For non-consolidated shipments, and for each house bill in a consolidated ship- ment, the consignee is the party to whom the cargo will be delivered in the United States, with the exception of ‘‘FROB’’ (foreign cargo remaining on board). However, in the case of cargo shipped ‘‘to order of [a named party],’’ the carrier must report this named ‘‘to order’’ party as the consignee; and, if there is any other commercial party listed in the bill of lading for delivery or contact purposes, the carrier must also report this other commercial par- ty’s identity and contact information (address) in the ‘‘Notify Party’’ field of the advance electronic data trans- mission to CBP, to the extent that the CBP-approved electronic data inter- change system is capable of receiving this data. The identification number will be a unique number assigned by CBP upon implementation of the Auto- mated Commercial Environment);

(x) The vessel name, country of docu- mentation, and official vessel number. (The vessel number is the International Maritime Organization number as- signed to the vessen( �

(xi) The foreign port where the cargo is laden on board;

(xii) Internationally recognized haz- ardous material code when such mate- rials are being shipped;

(xiii) Container numbers (for con- tainerized shipments);

(xiv) The seal numbers for all seals affixed to containers; and

(xv) Date of departure from foreign, as reflected in the vessel log (this ele- ment relates to the departure of the vessel from the foreign port with re- spect to which the advance cargo dec- laration is filed (see § 4.7(b)(2) or § 4.7(b)(4)); the time frame for reporting this data element will be either:

(A) No later than 24 hours after de- parture from the foreign port of lading, for those vessels that will arrive in the

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00028 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

19

U.S. Customs and Border Protection, DHS; Treasury § 4.7b

United States more than 24 hours after sailing from that foreign port; or

(B) No later than the presentation of the permit to unlade (CBP Form 3171, or electronic equivalent), for those ves- sels that will arrive less than 24 hours after sailing from the foreign port of lading); and

(xvi) Time of departure from foreign, as reflected in the vessel log (see § 4.7a(c)(4)(xv) for the applicable foreign port and the time frame within which this data element must be reported to CBP).

(d) Crew List. The Crew List shall be completed in accordance with the re- quirements of applicable Department of Homeland Security (DHS) regula- tions administered by CBP (8 CFR part 251).

(e) Passenger List. (1) The Passenger List shall be completed in accordance with § 4.50 and with the requirements of applicable DHS regulations adminis- tered by CBP (8 CFR part 231), and the following certification shall be placed on its last page:

I certify that CBP baggage declaration re- quirements have been made known to incom- ing passengers; that any required CBP bag- gage declarations have been or will simulta- neously herewith be filed as required by law and regulation with the proper CBP officer; and that the responsibilities devolving upon this vessel in connection therewith, if any, have been or will be discharged as required by law or regulation before the proper CBP officer. I further certify that there are no steerage passengers on board this vessel (46 U.S.C. 151–163).

———————————— Master

(2) If the vessel is carrying steerage passengers, the reference to steerage passengers shall be deleted from the certification, and the master shall comply with the requirements of § 4.50.

(3) If there are no steerage passengers aboard upon arrival, the listing of the passengers may be in the form of a ves- sel ‘‘souvenir passenger list,’’ or simi- lar list, in which the names of the pas- sengers are listed alphabetically and to which the certificate referred to in paragraph (e)(1) of this section is at- tached.

(4) All baggage on board a vessel not accompanying a passenger and the marks or addresses thereof shall be

listed on the last sheet of the passenger list under the caption ‘‘Unaccompanied baggage.’’

(f) Failure to provide manifest informa- tion; penalties/liquidated damages. Any master who fails to provide manifest information as required by this sec- tion, or who presents or transmits elec- tronically any document required by this section that is forged, altered or false, may be liable for civil penalties as provided under 19 U.S.C. 1436, in ad- dition to damages under the inter- national carrier bond of $5,000 for each violation discovered. In addition, if any non-vessel operating common carrier (NVOCC) as defined in § 4.7(b)(3)(ii) elects to transmit cargo declaration in- formation to CBP electronically, and fails to do so as required by this sec- tion, or transmits electronically any document required by this section that is forged, altered or false, such NVOCC may be liable for liquidated damages as provided in § 113.64(c) of this chapter of $5,000 for each violation discovered.

[T.D. 71–169, 36 FR 12602, July 2, 1971, as amended by T.D. 73–27, 38 FR 2448, Jan. 26, 1973; T.D. 77–255, 42 FR 56320, Oct. 25, 1977; T.D. 79–31, 44 FR 5649, Jan. 29, 1979; T.D. 85– 123, 50 FR 29952, July 23, 1985; T.D. 89–58, 54 FR 20381, May 11, 1989; T.D. 93–66, 58 FR 44130, Aug. 19, 1993; T.D. 95–77, 60 FR 50010, Sept. 27, 1995; T.D. 98–74, 63 FR 51287, Sept. 25, 1998; T.D. 02–62, 67 FR 66332, Oct. 31, 2002; CBP Dec. 03–32, 68 FR 68169, Dec. 5, 2003; CBP Dec. 08– 46, 73 FR 71779, Nov. 25, 2008; CBP Dec. 11–10, 76 FR 27609, May 12, 2011]

§ 4.7b Electronic passenger and crew arrival manifests.

(a) Definitions. The following defini- tions apply for purposes of this section:

Appropriate official. ‘‘Appropriate offi- cial’’ means the master or commanding officer, or authorized agent, owner, or consignee, of a commercial vessel; this term and the term ‘‘carrier’’ are some- times used interchangeably.

Carrier. See ‘‘Appropriate official.’’ Commercial vessel. ‘‘Commercial ves-

sel’’ means any civilian vessel being used to transport persons or property for compensation or hire.

Crew member. ‘‘Crew member’’ means a person serving on board a vessel in good faith in any capacity required for normal operation and service of the voyage. In addition, the definition of

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00029 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

20

19 CFR Ch. I (4–1–12 Edition)§ 4.7b

‘‘crew member’’ applicable to this sec- tion should not be applied in the con- text of other customs laws, to the ex- tent this definition differs from the meaning of ‘‘crew member’’ con- templated in such other customs laws.

Emergency. ‘‘Emergency’’ means, with respect to a vessel arriving at a U.S. port due to an emergency, an ur- gent situation due to a mechanical, medical, or security problem affecting the voyage, or to an urgent situation affecting the non-U.S. port of destina- tion that necessitates a detour to a U.S. port.

Ferry. ‘‘Ferry’’ means any vessel which is being used to provide trans- portation only between places that are no more than 300 miles apart and which is being used to transport only pas- sengers and/or vehicles, or railroad cars, which are being used, or have been used, in transporting passengers or goods.

Passenger. ‘‘Passenger’’ means any person being transported on a commer- cial vessel who is not a crew member.

United States. ‘‘United States’’ means the continental United States, Alaska, Hawaii, Puerto Rico, Guam, the Virgin Islands of the United States, and the Commonwealth of the Northern Mar- iana Islands (beginning November 28, 2009).

(b) Electronic arrival manifest—(1) Gen- eral requirement. Except as provided in paragraph (c) of this section, an appro- priate official of each commercial ves- sel arriving in the United States from any place outside the United States must transmit to Customs and Border Protection (CBP) an electronic pas- senger arrival manifest and an elec- tronic crew member arrival manifest. Each electronic arrival manifest:

(i) Must be transmitted to CPB at the place and time specified in paragraph (b)(2) of this section by means of an electronic data interchange system ap- proved by CBP. If the transmission is in US EDIFACT format, the passenger manifest and the crew member mani- fest must be transmitted separately; and

(ii) Must set forth the information specified in paragraph (b)(3) of this sec- tion.

(2) Place and time for submission—(i) General requirement. The appropriate of-

ficial must transmit each electronic arrival manifest required under para- graph (b)(1) of this section to the CBP Data Center, CBP Headquarters:

(A) In the case of a voyage of 96 hours or more, at least 96 hours before enter- ing the first United States port or place of destination;

(B) In the case of a voyage of less than 96 hours but at least 24 hours, prior to departure of the vessel;

(C) In the case of a voyage of less than 24 hours, at least 24 hours before entering the first U.S. port or place of destination; and

(D) In the case of a vessel that was not destined to the United States but was diverted to a U.S. port due to an emergency, before the vessel enters the U.S. port or place to which diverted; in cases of non-compliance, CBP will take into consideration that the carrier was not equipped to make the transmission and the circumstances of the emer- gency situation.

(ii) Amendment of crew member mani- fests. In any instance where a crew member boards the vessel after initial submission of the manifest under para- graph (b)(2)(i) of this section, the ap- propriate official must transmit amended manifest information to CBP reflecting the data required under paragraph (b)(3) of this section for the additional crew member. The amended manifest information must be trans- mitted to the CBP data Center, CBP Headquarters:

(A) If the remaining voyage time after initial submission of the manifest is 24 hours or more, at least 24 hours before entering the first U.S. port or place of destination; or

(B) In any other case, at least 12 hours before the vessel enters the first U.S. port or place of destination.

(3) Information required. Each elec- tronic arrival manifest required under paragraph (b)(1) of this section must contain the following information for all passengers and crew members, ex- cept that for commercial passenger vessels, the information specified in paragraphs (b)(3)(iv), (v), (x), (xii), (xiii), (xiv), (xvi), (xviii), and (xix) of this section must be included on the manifest only on or after October 4, 2005:

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00030 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

21

U.S. Customs and Border Protection, DHS; Treasury § 4.7c

(i) Full name (last, first, and, if available, middle);

(ii) Date of birth; (iii) Gender (F = female; M = male); (iv) Citizenship; (v) Country of residence; (vi) Status on board the vessel; (vii) Travel document type (e.g., P =

passport, A = alien registration); (viii) Passport number, if a passport

is required; (ix) Passport country of issuance, if a

passport is required; (x) Passport expiration date, if a

passport is required; (xi) Alien registration number, where

applicable; (xii) Address while in the United

States (number and street, city, state, and zip code), except that this informa- tion is not required for U.S. citizens, lawful permanent residents, crew mem- bers, or persons who are in transit to a location outside the United States;

(xiii) Passenger Name Record loca- tor, if available;

(xiv) Foreign port/place where trans- portation to the United States began (foreign port code);

(xv) Port/place of first arrival (CBP port code);

(xvi) Final foreign port/place of des- tination for in-transit passenger and crew member (foreign port code);

(xvii) Vessel name; (xviii) Vessel country of registry/flag; (xix) International Maritime Organi-

zation number or other official number of the vessel;

(xx) Voyage number (applicable only for multiple arrivals on the same cal- endar day); and

(xxi) Date of vessel arrival. (c) Exceptions. The electronic arrival

manifest requirement specified in para- graph (b) of this section is subject to the following conditions:

(1) No passenger or crew member manifest is required if the arriving commercial vessel is operating as a ferry;

(2) If the arriving commercial vessel is not transporting passengers, only a crew member manifest is required; and

(3) No passenger manifest is required for active duty U.S. military personnel onboard an arriving Department of De- fense commercial chartered vessel.

(d) Carrier responsibility for comparing information collected with travel docu- ment. The carrier collecting the infor- mation described in paragraph (b)(3) of this section is responsible for com- paring the travel document presented by the passenger or crew member with the travel document information it is transmitting to CBP in accordance with this section in order to ensure that the information transmitted is correct, the document appears to be valid for travel to the United States, and the passenger or crew member is the person to whom the travel docu- ment was issued.

(e) Sharing of manifest information. In- formation contained in passenger and crew member manifests that is re- ceived by CBP electronically may, upon request, be shared with other Federal agencies for the purpose of pro- tecting national security. CBP may also share such information as other- wise authorized by law.

[CBP Dec. 05–12, 70 FR 17850, Apr. 7, 2005, as amended at CBP Dec.09–02, 74 FR 2836, Jan. 16, 2009; CBP Dec. 09–14, 74 FR 25388, May 28, 2009]

§ 4.7c Vessel stow plan. Vessel stow plan required. In addition

to the advance filing requirements pur- suant to §§ 4.7 and 4.7a of this part and the container status message require- ments pursuant to § 4.7d of this part, for all vessels subject to § 4.7(a) of this part, except for any vessel exclusively carrying break bulk cargo or bulk cargo as prescribed in § 4.7(b)(4) of this part, the incoming carrier must submit a vessel stow plan consisting of vessel and container information as specified in paragraphs (b) and (c) of this section within the time prescribed in para- graph (a) of this section via the CBP- approved electronic data interchange system.

(a) Time of transmission. Customs and Border Protection (CBP) must receive the stow plan no later than 48 hours after the vessel departs from the last foreign port. For voyages less than 48 hours in duration, CBP must receive the stow plan prior to arrival at the first U.S. port.

(b) Vessel information required to be re- ported. The following information must be reported for each vessel:

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00031 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

22

19 CFR Ch. I (4–1–12 Edition)§ 4.7d

(1) Vessel name (including inter- national maritime organization (IMO) number);

(2) Vessel operator; and (3) Voyage number. (c) Container information required to be

reported. The following information must be reported for each container carried on each vessel:

(1) Container operator; (2) Equipment number; (3) Equipment size and type; (4) Stow position; (5) Hazmat code (if applicable); (6) Port of lading; and (7) Port of discharge. (d) Compliance date of this section. (1)

General. Subject to paragraph (d)(2) of this section, all affected ocean carriers must comply with the requirements of this section on and after January 26, 2010.

(2) Delay in compliance date of section. CBP may, at its sole discretion, delay the general compliance date set forth in paragraph (d)(1) of this section in the event that any necessary modifica- tions to the approved electronic data interchange system are not yet in place or for any other reason. Notice of any such delay will be provided in the FEDERAL REGISTER.

[CBP Dec. 08–46, 73 FR 71779, Nov. 25, 2008]

§ 4.7d Container status messages. (a) Container status messages required.

In addition to the advance filing re- quirements pursuant to §§ 4.7 and 4.7a of this part and the vessel stow plan re- quirements pursuant to § 4.7c of this part, for all containers destined to ar- rive within the limits of a port in the United States from a foreign port by vessel, the incoming carrier must sub- mit messages regarding the status of the events as specified in paragraph (b) of this section if the carrier creates or collects a container status message (CSM) in its equipment tracking sys- tem reporting that event. CSMs must be transmitted to Customs and Border Protection (CBP) within the time pre- scribed in paragraph (c) of this section via a CBP-approved electronic data interchange system. There is no re- quirement that a carrier create or col- lect any CSMs under this paragraph that the carrier does not otherwise cre- ate or collect on its own and maintain

in its electronic equipment tracking system.

(b) Events required to be reported. The following events must be reported if the carrier creates or collects a con- tainer status message in its equipment tracking system reporting that event:

(1) When the booking relating to a container which is destined to arrive within the limits of a port in the United States by vessel is confirmed;

(2) When a container which is des- tined to arrive within the limits of a port in the United States by vessel un- dergoes a terminal gate inspection;

(3) When a container, which is des- tined to arrive within the limits of a port in the United States by vessel, ar- rives or departs a facility (These events take place when a container enters or exits a port, container yard, or other facility. Generally, these CSMs are re- ferred to as ‘‘gate-in’’ and ‘‘gate-out’’ messages.);

(4) When a container, which is des- tined to arrive within the limits of a port in the United States by vessel, is loaded on or unloaded from a convey- ance (This includes vessel, feeder ves- sel, barge, rail and truck movements. Generally, these CSMs are referred to as ‘‘loaded on’’ and ‘‘unloaded from’’ messages);

(5) When a vessel transporting a con- tainer, which is destined to arrive within the limits of a port in the United States by vessel, departs from or arrives at a port (These events are commonly referred to as ‘‘vessel depar- ture’’ and ‘‘vessel arrival’’ notices);

(6) When a container which is des- tined to arrive within the limits of a port in the United States by vessel un- dergoes an intra-terminal movement;

(7) When a container which is des- tined to arrive within the limits of a port in the United States by vessel is ordered stuffed or stripped;

(8) When a container which is des- tined to arrive within the limits of a port in the United States by vessel is confirmed stuffed or stripped; and

(9) When a container which is des- tined to arrive within the limits of a port in the United States by vessel is stopped for heavy repair.

(c) Time of transmission. For each event specified in paragraph (b) of this section that has occurred, and for

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00032 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

23

U.S. Customs and Border Protection, DHS; Treasury § 4.9

which the carrier creates or collects a container status message (CSM) in its equipment tracking system reporting that event, the carrier must transmit the CSM to CBP no later than 24 hours after the CSM is entered into the equipment tracking system.

(d) Contents of report. The report of each event must include the following:

(1) Event code being reported, as de- fined in the ANSI X.12 or UN EDIFACT standards;

(2) Container number; (3) Date and time of the event being

reported; (4) Status of the container (empty or

fuln( � (5) Location where the event took

place; and (6) Vessel identification associated

with the message if the container is as- sociated with a specific vessel.

(e) A carrier may transmit other con- tainer status messages in addition to those required pursuant to paragraph (b) of this section. By transmitting ad- ditional container status messages, the carrier authorizes Customs and Border Protection (CBP) to access and use those data.

(f) Compliance date of this section. (1) General. Subject to paragraph (f)(2) of this section, all affected ocean carriers must comply with the requirements of this section on and after January 26, 2010.

(2) Delay in compliance date of section. CBP may, at its sole discretion, delay the general compliance date set forth in paragraph (f)(1) of this section in the event that any necessary modifications to the approved electronic data inter- change system are not yet in place or for any other reason. Notice of any such delay will be provided in the FED- ERAL REGISTER.

[CBP Dec. 08–46, 73 FR 71779, Nov. 25, 2008]

§ 4.8 Preliminary entry. (a) Generally. Preliminary entry al-

lows a U.S. or foreign vessel arriving under circumstances that require it to formally enter, to commence lading and unlading operations prior to mak- ing formal entry. Preliminary entry may be accomplished electronically pursuant to an authorized electronic data interchange system, or by any other means of communication ap-

proved by the Customs and Border Pro- tection (CBP).

(b) Requirements and conditions. Pre- liminary entry must be made in com- pliance with § 4.30, and may be granted prior to, at, or subsequent to arrival of the vessel. The granting of preliminary vessel entry by Customs at or subse- quent to arrival of the vessel, is condi- tioned upon the presentation to and ac- ceptance by Customs of all forms, elec- tronically or otherwise, comprising a complete manifest as provided in § 4.7, except that the Cargo Declaration, CBP Form 1302, must be presented to Customs electronically in the manner provided in § 4.7(b)(2) or (4). Vessels seeking preliminary entry in advance of arrival must do so: By presenting to Customs the electronic equivalent of a complete CBP Form 1302 (Cargo Dec- laration), in the manner provided in § 4.7(b)(2) or (4), showing all cargo on board the vessel; and by presenting CBP Form 3171 electronically no less than 48 hours prior to vessel arrival. The CBP Form 3171 will also serve as notice of intended date of arrival. The port director may allow for the presen- tation of the CBP Form 1302 and CBP Form 3171 less than 48 hours prior to arrival in order to grant advanced pre- liminary entry if a vessel voyage takes less than 48 hours to complete from the last foreign port to the first U.S. port, or if other reasonable circumstances warrant. Preliminary entry granted in advance of arrival will become effec- tive upon arrival at the port granting preliminary entry. Additionally, Cus- toms must receive confirmation of a vessel’s estimated time of arrival in a manner acceptable to the port director.

[T.D. 00–4, 65 FR 2872, Jan. 19, 2000, as amend- ed by T.D. 02–62, 67 FR 66332, Oct. 31, 2002; CBP Dec. 11–10, 76 FR 27609, May 12, 2011]

§ 4.9 Formal entry. (a) General. Section 4.3 provides

which vessels are subject to formal entry and where and when entry must be made. The formal entry of an Amer- ican vessel is governed by section 434, Tariff Act of 1930 (19 U.S.C. 1434). The term ‘‘American vessel’’ means a vessel of the United States (see § 4.0(b)) as well as, when arriving by sea, a vessel entitled to be documented except for its size (see § 4.0(c)). The formal entry

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00033 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

24

19 CFR Ch. I (4–1–12 Edition)§ 4.10

of a foreign vessel arriving within the limits of any CBP port is also governed by section 434, Tariff Act of 1930 (19 U.S.C. 1434). Alternatively, information necessary for formal entry may be transmitted electronically pursuant to a system authorized by CBP.

(b) Procedures for American vessels. Under certain circumstances, Amer- ican vessels arriving in ports of the United States directly from other United States ports must make entry. Entry of such vessels is required when they have unentered foreign merchan- dise aboard. Report of arrival as pro- vided in § 4.2 of this part, together with presenting a completed CBP Form 1300 (Vessel Entrance or Clearance State- ment), satisfies all entry requirements for the subject vessels.

(c) Delivery of foreign vessel document. The master of any foreign vessel will exhibit the vessel’s document to the port director on or before the entry of the vessel. After the net tonnage has been noted, the document may be de- livered to the consul of the nation to which such vessel belongs, in which event the vessel master will certify to the port director the fact of such deliv- ery (see section 434, Tariff Act of 1930, as amended (19 U.S.C. 1434), as applied through section 438, Tariff Act of 1930, as amended (19 U.S.C. 1438)). If not de- livered to the consul, the document will be deposited in the customhouse. Whether delivered to the foreign consul or deposited at the customhouse, the document will not be delivered to the master of the foreign vessel until clear- ance is granted under § 4.61. It will not be lawful for any foreign consul to de- liver to the master of any foreign ves- sel the register, or document in lieu thereof, deposited with him in accord- ance with the provisions of 19 U.S.C. 1434 until such master will produce to him a clearance in due form from the director of the port where such vessel has been entered. Any consul violating the provisions of this section is liable to a fine of not more than $5,000 (sec- tion 438, Tariff Act of 1930, as amended; 19 U.S.C. 1438).

(d) Failure to make required entry; pen- alties. Any master who fails to make entry as required by this section or who presents or transmits electroni- cally any document required by this

section that is forged, altered, or false, may be liable for certain civil penalties as provided under 19 U.S.C. 1436, in ad- dition to penalties applicable under other provisions of law. Further, any vessel used in connection with any such violation is subject to seizure and forfeiture.

[T.D. 00–4, 65 FR 2873, Jan. 19, 2000; T.D. 00– 22, 65 FR 16515, Mar. 29, 2000; CBP Dec. 10–33, 75 FR 69585, Nov. 15, 2010]

§ 4.10 Request for overtime services. Request for overtime services in con-

nection with entry or clearance of a vessel, including the boarding of a ves- sel in accordance with § 4.1 shall be made on Customs Form 3171. (See § 24.16 of this chapter regarding pleas- ure vessels.) Such request for overtime services must specify the nature of the services desired and the exact times when they will be needed, unless a term special license (unlimited or lim- ited to the service requested) has been issued (see § 4.30(g)) and arrangements are made locally so that the proper Customs officer will be notified during official hours in advance of the ren- dering of the services as to the nature of the services desired and the exact times they will be needed. Such request shall not be approved (previously issued term special licenses shall be re- voked) unless the carrier complies with the provisions of paragraphs (l) and (m) of § 4.30 regarding terminal facilities and employee lists, respectively, and the required cash deposit or bond, on Customs Form 301, containing the bond conditions set forth in § 113.64 of this chapter, has been received. Separate bonds shall be required if overtime services are requested by different principals.

[T.D. 72–189, 37 FR 13975, July 15, 1972, as amended by T.D. 84–213, 49 FR 41163, Oct. 19, 1984; T.D. 92–74, 57 FR 35751, Aug. 11, 1992]

§ 4.11 Sealing of stores. Upon the arrival of a vessel from a

foreign port, or a vessel engaged in the foreign trade from a domestic port, sea stores and ship’s stores not required for immediate use or consumption on board while the vessel is in port and ar- ticles acquired abroad by officers and members of the crew, for which no per- mit to land has been issued, shall be

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00034 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

25

U.S. Customs and Border Protection, DHS; Treasury § 4.14

placed under seal, unless the Customs officer is of the opinion that the cir- cumstances do not require such action. Customs inspectors in charge of the vessel, from time to time, as in their judgment the necessity of the case re- quires, may issue stores from under seal for consumption on board the ves- sel by its passengers and crew. (See § 4.39.)

§ 4.12 Explanation of manifest discrep- ancy.

(a)(1) Vessel masters or agents shall notify the port director on Customs Form 5931 of shortages (merchandise manifested, but not found) or overages (merchandise found, but not mani- fested) of merchandise.

(2) Shortages shall be reported to the port direct by the master or agent of the vessel by endorsement on the im- porter’s claim for shortage on Customs Form 5931 as provided for in § 158.3 of this chapter, or within 60 days after the date of entry of the vessel, whichever is later. Satisfactory evidence to support the claim of nonimportation or of prop- er disposition or other corrective ac- tion (see § 4.34) shall be obtained by the master or agent and shall be retained in the carrier’s file for one year.

(3) Overages shall be reported to the port director within 60 days after the date of entry of the vessel by comple- tion of a post entry or suitable expla- nation of corrective action (see § 4.34) on the Customs Form 5931.

(4) The port director shall imme- diately advise the master or agent of those discrepancies which are not re- ported by the master or agent. Notifi- cation may be in any appropriate man- ner, including the furnishing of a copy of Customs Form 5931 to the master or agent. The master or agent shall satis- factorily resolve the matter within 30 days after the date of such notifica- tion, or within 60 days after entry of the vessel, whichever is later.

(5) Unless the required notification and explanation is made timely and the port director is satisfied that the dis- crepancies resulted from clerical error or other mistake and that there has been no loss of revenue (and in the case of a discrepancy not initially reported by the master or agent that there was a valid reason for failing to so report),

applicable penalties under section 584, Tariff Act of 1930, as amended (19 U.S.C. 1584), shall be assessed (see § 162.31 of this chapter). For purposes of this section, the term ‘‘clerical error’’ is defined as a non-negligent, inad- vertent, or typographical mistake in the preparation, assembly, or submis- sion (electronically or otherwise) of the manifest. However, repeated simi- lar manifest discrepancies by the same parties may be deemed the result of negligence and not clerical error or other mistake. For the purpose of as- sessing applicable penalties, the value of the merchandise shall be determined as prescribed in § 162.43 of this chapter. The fact that the master or owner had no knowledge of a discrepancy shall not relieve him from the penalty.

(b) Except as provided in paragraph (c) of this section, a correction in the manifest shall not be required in the case of bulk merchandise if the port di- rector is satisfied that the difference between the manifested quantity and the quantity unladen, whether the dif- ference constitutes an overage or a shortage, is an ordinary and usual dif- ference properly attributable to ab- sorption of moisture, temperature, faulty weighing at the port of lading, or other similar reason. A correction in the manifest shall not be required be- cause of discrepancies between marks or numbers on packages of merchan- dise and the marks or numbers for the same packages as shown on the mani- fest of the importing vessel when the quantity and description of the mer- chandise in such packages are cor- rectly given.

(c) Manifest discrepancies (shortages and overages) of petroleum and petro- leum products imported in bulk shall be reported on Customs Form 5931, if the discrepancy exceeds one percent.

[T.D. 80–142, 45 FR 36383, May 30, 1980, as amended by T.D. 99–64, 64 FR 43265, Aug. 10, 1999; CBP Dec. 10–29, 75 FR 52450, Aug. 26, 2010]

§ 4.13 [Reserved]

§ 4.14 Equipment purchases by, and re- pairs to, American vessels.

(a) General provisions and applica- bility—(1) General. Under section 466, Tariff Act of 1930, as amended (19

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00035 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

26

19 CFR Ch. I (4–1–12 Edition)§ 4.14

U.S.C. 1466), purchases for or repairs made to certain vessels while they are outside the United States are subject to declaration, entry, and payment of ad valorem duty. These requirements are effective upon the first arrival of affected vessels in the United States or Puerto Rico. The vessels subject to these requirements include those docu- mented under the U.S. law for the for- eign or coastwise trades, as well as those which were previously docu- mented under the laws of some foreign nation or are undocumented at the time that foreign shipyard repairs are performed, but which exhibit an intent to engage in those trades under CBP interpretations. Duty is based on ac- tual foreign cost. This includes the original foreign purchase price of arti- cles that have been imported into the United States and are later sent abroad for use.

(2) Expenditures not subject to declara- tion, entry, or duty. The following vessel repair expenditures are not subject to declaration, entry, or duty:

(i) Expenditures made in American Samoa, the Guantanamo Bay Naval Station, Guam, Puerto Rico, or the U.S. Virgin Islands because they are considered to have been made in the United States;

(ii) Reimbursements paid to members of the regular crew of a vessel for labor expended in making repairs to vessels; and

(iii) The cost of equipment, repair parts, and materials that are installed on a vessel documented under the laws of the United States and engaged in the foreign or coasting trade, if the instal- lation is done by members of the reg- ular crew of such vessel while the ves- sel is on the high seas, in foreign wa- ters, or in a foreign port, and does not involve foreign shipyard repairs by for- eign labor.

(3) Expenditures subject to declaration and entry but not duty. Under separate provisions of law, the cost of labor per- formed, and of parts and materials pro- duced and purchased in Israel are not subject to duty under the vessel repair statute. Additionally, expenditures made in Canada or in Mexico are not subject to any vessel repair duties. Furthermore, certain free trade agree- ments between the United States and

other countries also may reduce the duties on vessel repair expenditures made in foreign countries that are par- ties to those agreements, although the final duty amount may depend on each agreement’s schedule for phasing in those reductions. In these situations and others where there is no liability for duty, it is still required, except as otherwise required by law, that all re- pairs and purchases be declared and en- tered.

(b) Applicability to specific types of ves- sels—(1) Fishing vessels. As provided in § 4.15, vessels documented under U.S. law with a fishery endorsement are subject to vessel repair duties for cov- ered foreign expenditures. Undocu- mented American fishing vessels which are repaired, or for which parts, nets or equipment are purchased outside the U.S. are also liable for duty.

(2) Government-owned or chartered ves- sels. Vessels normally subject to the vessel repair statute because of docu- mentation or intended use are not ex- cused from duty liability merely be- cause they are either owned or char- tered by the U.S. Government.

(3) Vessels continuously away for two years or longer—(i) Liability for expendi- tures throughout entire absence from U.S. Vessels that continuously remain out- side the United States for two years or longer are liable for duty on any fish nets and netting purchased at any time during the entire absence. Vessels de- signed and used primarily for trans- porting passengers or merchandise, which depart the United States for the sole purpose of obtaining equipment, parts, materials or repairs remain fully liable for duty regardless of the dura- tion of their absence from the United States.

(ii) Liability for expenditures made dur- ing first six months of absence. Except as provided in paragraph (b)(3)(i) of this section, vessels that continuously re- main outside the United States for two years or longer are liable for duty only on those expenditures which are made during the first six months of their ab- sence. See paragraph (h)(3) of this sec- tion. However, even though some costs might not be dutiable because of the six-month rule, all repairs, materials, parts and equipment-related expendi- tures must be declared and entered.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00036 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

27

U.S. Customs and Border Protection, DHS; Treasury § 4.14

(c) Estimated duty deposit and bond re- quirements. Generally, the person au- thorized to submit a vessel repair dec- laration and entry must either deposit or transmit estimated duties or produce evidence of a bond on CBP Form 301 at the first United States port of arrival before the vessel will be permitted to depart from that port. A continuous or single entry bond of suf- ficient value to cover all potential duty on the foreign repairs and pur- chases must be identified by surety, number and amount on the vessel re- pair declaration which is submitted at the port of first arrival. At the time the vessel repair entry is submitted by the vessel operator to the appropriate VRU port of entry as defined in para- graph (g) of this section, that same identifying information must be identi- fied on the entry form. Sufficiency of the amount of the bond is within the discretion of CBP at the arrival port with claims for reduction in duty li- ability necessarily being subject to full consideration of evidence by CBP. CBP officials at the port of arrival may con- sult the appropriate Vessel Repair Unit (VRU) port of entry as identified in paragraph (g) of this section or the staff of the Cargo Security, Carriers & Immigration Branch, Office of Inter- national Trade in CBP Headquarters in setting sufficient bond amounts. These duty, deposit, and bond requirements do not apply to vessels which are owned or chartered by the United States Government and are actually being operated by employees of an agency of the Government. If operated by a private party for a Federal agency under terms whereby that private party is liable under the contract for payment of the duty, there must be a deposit or a bond filed in an amount adequate to cover the estimated duty.

(d) Declaration required. When a vessel subject to this section first arrives in the United States following a foreign voyage, the owner, master, or author- ized agent must submit a vessel repair declaration on CBP Form 226, a dual- use form used both for declaration and entry purposes, or must transmit its electronic equivalent. The declaration must be ready for presentation in the event that a CBP officer boards the vessel. If no foreign repair-related ex-

penses were incurred, that fact must be reported either on the declaration form or by approved electronic means. The CBP port of arrival receiving either a positive or negative vessel repair dec- laration or electronic equivalent will immediately forward it to the appro- priate VRU port of entry as identified in paragraph (g) of this section.

(e) Entry required. The owner, master, or authorized representative of the owner of any vessel subject to this sec- tion for which a positive declaration has been filed must submit a vessel re- pair entry on CBP Form 226 or trans- mit its electronic equivalent. The entry must show all foreign voyage ex- penditures for equipment, parts of equipment, repair parts, materials and labor. The entry submission must indi- cate whether it provides a complete or incomplete account of covered expendi- tures. The entry must be presented or electronically transmitted by the ves- sel operator to the appropriate VRU port of entry as identified in paragraph (g) of this section, so that it is received within ten calendar days after arrival of the vessel. Claims for relief from duty should be made generally as part of the initial submission, and evidence must later be provided to support those claims. Failure to submit full sup- porting evidence of cost within stated time limits, including any extensions granted under this section, is consid- ered to be a failure to enter.

(f) Time limit for submitting evidence of cost. A complete vessel repair entry must be supported by evidence showing the cost of each item entered. If the entry is incomplete when submitted, evidence to make it complete must be received by the appropriate VRU port of entry as identified in paragraph (g) of this section within 90 calendar days from the date of vessel arrival. That evidence must include either the final cost of repairs or, if the operator sub- mits acceptable evidence that final cost information is not yet available, initial or interim cost estimates given prior to or after the work was author- ized by the operator. The proper VRU port of entry may grant one 30-day ex- tension of time to submit final cost evidence if a satisfactory written ex- planation of the need for an extension is received before the expiration of the

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00037 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

28

19 CFR Ch. I (4–1–12 Edition)§ 4.14

original 90-day submission period. All extensions will be issued in writing. In- adequate, vague, or open-ended re- quests will not be granted. Questions as to whether an extension should be granted may be referred to the Cargo Security, Carriers & Immigration Branch, Office of International Trade in CBP Headquarters by the VRU ports of entry. Any request for an extension beyond a 30-day grant issued by a VRU must be submitted through that unit to the Cargo Security, Carriers & Im- migration Branch, Office of Inter- national Trade, CBP Headquarters. In the event that all cost evidence is not furnished within the specified time limit, or is of doubtful authenticity, the VRU may refer the matter to the U.S. Immigration and Customs En- forcement to begin procedures to ob- tain the needed evidence. That agency may also investigate the reason for a failure to file or for an untimely sub- mission. Unexplained or unjustified delays in providing CBP with sufficient information to properly determine duty may result in penalty action as specified in paragraph (j) of this sec- tion. Extensions granted for the filing of necessary evidence may also extend the time for filing Applications for Re- lief (see paragraph (i)(1) of this sec- tion).

(g) Location and jurisdiction of vessel repair unit ports of entry. Vessel Repair Units (VRUs) are responsible for proc- essing vessel repair entries. VRUs are located in New York, New York; New Orleans, Louisiana; and San Francisco, California. The New York unit proc- esses vessel repair entries received from ports of arrival on the Great Lakes and the Atlantic Coast of the United States north of, but not includ- ing, those located in the State of Vir- ginia. The New Orleans unit processes vessel repair entries received from ports of arrival on the Atlantic Coast from and including those in the State of Virginia, southward, and from all United States ports of arrival on the Gulf of Mexico including ports in Puer- to Rico. The San Francisco unit proc- esses vessel repair entries received from all ports of entry on the Pacific Coast including those in Alaska and Hawaii.

(h) Justifications for relief from duty. Claims for relief from the assessment of vessel repair duties may be sub- mitted to CBP. Relief may be sought under paragraphs (a), (d), (e), or (h) of the vessel repair statute (19 U.S.C. 1466(a), (d), (e), or (h)), each paragraph of which relates to a different type of claim as further specified in para- graphs (h)(1)–(h)(4) of this section.

(1) Relief under 19 U.S.C. 1466(a). Re- quests for relief from duty under 19 U.S.C. 1466(a) consist of claims that a foreign shipyard operation or expendi- ture is not considered to be a repair or purchase within the terms of the vessel repair statute or as determined under judicial or administrative interpreta- tions. Example: a claim that the ship- yard operation is a vessel modification.

(2) Relief from duty under 19 U.S.C. 1466(d). Requests for relief from duty under 19 U.S.C. 1466(d) consist of claims that a foreign shipyard operation or ex- penditure involves any of the fol- lowing:

(i) Stress of weather or other casualty. Relief will be granted if good and suffi- cient evidence supports a finding that the vessel, while in the regular course of its voyage, was forced by stress of weather or other casualty, while out- side the United States, to purchase such equipment or make those repairs as are necessary to secure the safety and seaworthiness of the vessel in order to enable it to reach its port of destination in the United States. For the purposes of this paragraph, a ‘‘cas- ualty’’ does not include any purchase or repair made necessary by ordinary wear and tear, but does include the failure of a part to function if it is proven that the specific part was re- paired, serviced, or replaced in the United States immediately before the start of the voyage in question, and then failed within six months of that date.

(ii) U.S. parts installed by regular crew or residents. Relief will be granted if equipment, parts of equipment, repair parts, or materials used on a vessel were manufactured or produced in the United States and were purchased in the United States by the owner of the vessel. It is required under the statute that residents of the United States or

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00038 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

29

U.S. Customs and Border Protection, DHS; Treasury § 4.14

members of the regular crew of the ves- sel perform any necessary labor in con- nection with such installations.

(iii) Dunnage. Relief will be granted if any equipment, equipment parts, ma- terials, or labor were used for the pur- pose of providing dunnage for the pack- ing or shoring of cargo, for erecting temporary bulkheads or other similar devices for the control of bulk cargo, or for temporarily preparing tanks for carrying liquid cargoes.

(3) Relief under 19 U.S.C. 1466(e). Re- quests for relief from duty under 19 U.S.C. 1466(e) relate in pertinent part to matters involving vessels normally subject to the vessel repair statute, but that continuously remain outside the United States for two years or longer. Vessels that continuously remain out- side the United States for two years or longer may qualify for relief from duty on expenditures made later than the first six months of their absence. See paragraph (b)(3)(ii) of this section.

(4) Relief under 19 U.S.C. 1466(h). Re- quests for relief from duty under 19 U.S.C. 1466(h) consist of claims that a foreign shipyard operation or expendi- ture involves any of the following:

(i) Expenditures on LASH barges. Re- lief will be granted with respect to the cost of equipment, parts, materials, or repair labor for Lighter Aboard Ship (LASH) operations accomplished abroad.

(ii) Certain spare repair parts or mate- rials. Relief will be granted with re- spect to the cost of spare repair parts or materials which are certified by the vessel owner or master to be for use on a cargo vessel, but only if duty was previously paid under the appropriate commodity classification(s) as found in the Harmonized Tariff Schedule of the United States when the article first en- tered the United States.

(iii) Certain spare parts necessarily in- stalled on a vessel prior to their first entry into the United States. Relief will be granted with respect to the cost of spare parts only, which have been nec- essarily installed prior to their first entry into the United States with duty payment under the appropriate com- modity classification(s) as found in the Harmonized Tariff Schedule of the United States.

(i) General procedures for seeking re- lief—(1) Applications for Relief. Relief from the assessment of vessel repair duty will not be granted unless an Ap- plication for Relief is filed with CBP. Relief will not be granted based merely upon a claim for relief made at the time of entry under paragraph (e) of this section. The filing of an Applica- tion for Relief is not required, nor is one required to be presented in any particular format, but if filed it must clearly present the legal basis for granting relief, as specified in para- graph (h) of this section. An Applica- tion must also state that all repair op- erations performed aboard a vessel dur- ing the one-year period prior to the current submission have been declared and entered. A valid Application is re- quired to be supported by complete evi- dence as detailed in paragraphs (i)(1)(i)–(vi) and (i)(2) of this section. Except as further provided in this para- graph, the deadline for receipt of an Application and supporting evidence is 90 calendar days from the date that the vessel first arrived in the United States following foreign operations. The pro- visions for extension of the period for filing required evidence in support of an entry, as set forth in paragraph (f) of this section, are applicable to exten- sion of the time period for filing Appli- cations for Relief as well. Applications must be addressed and submitted by the vessel operator to the appropriate VRU port of entry and will be decided in that unit. The VRUs may seek the advice of the Cargo Security, Carriers & Immigration Branch, Office of Inter- national Trade in CBP Headquarters with regard to any specific item or issue which has not been addressed by clear precedent. If no Application is filed or if a submission which does not meet the minimal standards of an Ap- plication for Relief is received, the duty amount will be determined with- out regard to any potential claims for relief from duty (see paragraph (h) of this section). Each Application for Re- lief must include copies of:

(i) Itemized bills, receipts, and in- voices for items shown in paragraph (e) of this section. The cost of items for which a request for relief is made must be segregated from the cost of the

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00039 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

30

19 CFR Ch. I (4–1–12 Edition)§ 4.14

other items listed in the vessel repair entry;

(ii) Photocopies of relevant parts of vessel logs, as well as of any classifica- tion society reports which detail dam- age and remedies;

(iii) A certification by the senior offi- cer with personal knowledge of all rel- evant circumstances relating to cas- ualty damage (time, place, cause, and nature of damage);

(iv) A certification by the senior offi- cer with personal knowledge of all rel- evant circumstances relating to foreign repair expenditures (time, place, and nature of purchases and work per- formed);

(v) A certification by the master that casualty-related expenditures were necessary to ensure the safety and sea- worthiness of the vessel in reaching its United States port of destination; and

(vi) Any permits or other documents filed with or issued by any United States Government agency other than CBP regarding the operation of the ves- sel that are relevant to the request for relief.

(2) Additional evidence. In addition, copies of any other evidence and docu- ments the applicant may wish to pro- vide as evidentiary support may be submitted. Elements of applications which are not supported by required evidentiary elements will be considered fully dutiable. All documents sub- mitted must be certified by the master, owner, or authorized corporate officer to be originals or copies of originals, and if in a foreign language, they must be accompanied by an English trans- lation, certified by the translator to be accurate. Upon receipt of an Applica- tion for Relief by the VRU within the prescribed time limits, a determination of duties owed will be made. After a de- cision is made on an Application for Relief by a VRU, the applicant will be notified of the right to protest any ad- verse decision.

(3) Administrative protest. Following the determination of duty owing on a vessel repair entry, a protest may be filed under 19 U.S.C. 1514(a)(2) as the only and final administrative appeal. The procedures and time limits appli- cable to protests filed in connection with vessel repair entries are the same as those provided in part 174 of this

chapter. In particular, the applicable protest period will begin on the date of the issuance of the decision giving rise to the protest as reflected on the rel- evant correspondence from the appro- priate VRU.

(j) Penalties—(1) Failure to report, enter, or pay duty. It is a violation of the vessel repair statute if the owner or master of a vessel subject to this section willfully or knowingly neglects or fails to report, make entry, and pay duties as required; makes any false statements regarding purchases or re- pairs described in this section without reasonable cause to believe the truth of the statements; or aids or procures any false statements regarding any mate- rial matter without reasonable cause to believe the truth of the statement. If a violation occurs, the vessel, its tackle, apparel, and furniture, or a monetary amount up to their value as determined by CBP, is subject to sei- zure and forfeiture and is recoverable from the owner (see § 162.72 of this chapter).

(2) False declaration. If any person re- quired to file a vessel repair declara- tion or entry under this section, know- ingly and willfully falsifies, conceals or covers up by any trick, scheme, or de- vice a material fact, or makes any ma- terially false, fictitious or fraudulent statement or representation, or makes or uses any false writing or document knowing the same to contain any ma- terially false, fictitious or fraudulent statement, that person will be subject to the criminal penalties provided for in 18 U.S.C. 1001.

[66 FR 16397, Mar. 26, 2001, as amended at 74 FR 53651, Oct. 20, 2009]

EFFECTIVE DATE NOTE: At 77 FR 17332, Mar. 26, 2012, § 4.15 was amended by revising the section heading; paragraph (i)(3) is redesig- nated as paragraph (i)(4) and a new para- graph (i)(3) is added; andparagraph (j)(1) is amended by adding a new third sentence, ef- fective April 25, 2012. For the convenience of the user, the added and revised text is set forth as follows:

§ 4.14 Equipment purchases for, and repairs to, American vessels.

* * * * *

(i) * * * (3) Application for Relief; failure to file or de-

nial in whole or in part. If no Application for

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00040 Fmt 8010 Sfmt 8003 Q:\19\19V1.TXT ofr150 PsN: PC150

31

U.S. Customs and Border Protection, DHS; Treasury § 4.20

28 If such a vessel puts into a foreign port or place and only obtains bunkers, stores, or supplies suitable for a fishing voyage, it is not considered to have touched and traded there. Fish nets and netting are considered vessel equipment and not vessel supplies.

29-61 [Reserved]

Relief is filed, or if a timely filed Application for Relief is denied in whole or in part, the VRU will determine the amount of duty due and issue a bill to the party who filed the vessel repair entry. If the bill is not timely paid, interest will accrue as provided in § 24.3a(b)(1) of this chapter.

(j) * * * (1) * * * The owner or master of the vessel

who fails to timely pay the duty determined to be due is liable for interest as provided in § 24.3a(b)(1) of this chapter.

* * * * *

§ 4.15 Fishing vessels touching and trading at foreign places.

(a) Before any vessel documented with a fishery license endorsement shall touch and trade at a foreign port or place, the master shall obtain from the port director a permit on Customs Form 1379 to touch and trade. When a fishing vessel departs from the United States and there is an intent to stop at a foreign port (1) to lade vessel equipment which was preordered, (2) to purchase and lade vessel equipment, or (3) to purchase and lade vessel equip- ment to replace existing vessel equip- ment, the master of the vessel must ei- ther clear for that foreign port or ob- tain a permit to touch and trade, whether or not the vessel will engage in fishing on that voyage. 28 Purchases of such equipment, whether intended at the time of departure or not, are sub- ject to declaration, entry, and payment of duty pursuant to section 466 of the Tariff Act of 1930, as amended (19 U.S.C. 1466). The duty may be remitted if it is established that the purchases resulted from stress of weather or other casualty.

(b) Upon the arrival of a documented vessel with a fishery endorsement which has put into a foreign port or place, the master shall report its ar- rival, make entry, and conform in all respects to the regulations applicable in the case of a vessel arriving from a foreign port.

(c) If a vessel which has been granted a permit to touch and trade arrives at a port in the United States, whether or not the vessel has touched at a foreign port or place, such permit shall forth- with be surrendered to the port direc- tor.

(d) No permit to touch and trade shall be issued to a vessel which does not have a Certificate of Documenta- tion with a fishery license endorse- ment.

[28 FR 14596, Dec. 31, 1963, as amended by T.D. 77–28, 42 FR 3161, Jan. 17, 1977; T.D. 83– 214, 48 FR 46512, Oct. 13, 1983; T.D. 94–24, 59 FR 13200, Mar. 21, 1994; T.D. 95–77, 60 FR 50010, Sept. 27, 1995]

§ 4.16 [Reserved]

§ 4.17 Vessels from discriminating countries.

The prohibition against imports in, and the penalty of forfeiture of, certain vessels from countries which discrimi- nate against American vessels provided for in subsections 2 and 3 of paragraph J, section IV, Tariff Act of 1913, as amended by the act of March 4, 1915 (19 U.S.C. 130, 131), shall be enforced only in pursuance of specific instructions issued and published from time to time by the Secretary of the Treasury or such other officer as the Secretary may designate. (See also §§ 4.20(c) and 159.42 of this chapter.)

[28 FR 14596, Dec. 31, 1963, as amended by T.D. 73–175, 38 FR 17444, July 2, 1973]

TONNAGE TAX AND LIGHT MONEY

§ 4.20 Tonnage taxes. (a) Except as specified in § 4.21, a reg-

ular tonnage tax or duty of 2 cents per net ton, not to exceed in the aggregate 10 cents per net ton in any 1 year, shall be imposed at each entry on all vessels which shall be entered in any port of the United States from any foreign port or place in North America, Cen- tral America, the West Indies, the Ba- hama Islands, the Bermuda Islands, the coast of South America bordering on the Caribbean Sea (considered to in- clude the mouth of the Orinoco River), or the high seas adjacent to the U.S. or the above listed foreign locations, and on all vessels (except vessels of the U.S., recreational vessels, and barges,

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00041 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

32

19 CFR Ch. I (4–1–12 Edition)§ 4.20

as defined in § 2101 of Title 46) that de- part a U.S. port or place and return to the same port or place without being entered in the United States from an- other port or place, and regular ton- nage tax of 6 cents per net ton, not to exceed 30 cents per net ton per annum, shall be imposed at each entry on all vessels which shall be entered in any port of the United States from any other foreign port. In determining the port of origin of a voyage to the United States and the rate of tonnage tax, the following shall be used as a guide:

(1) When the vessel has proceeded in ballast from a port to which the 6-cent rate is applicable to a port to which the 2-cent rate applies and there has laden cargo or taken passengers, ton- nage tax upon entry in the United States shall be assessed at the 2-cent rate.

(2) The same rate shall be applied in a case in which the vessel has trans- ported cargo or passengers from a 6- cent port to a 2-cent port when all such cargo or passengers have been unladen or discharged at the 2-cent port, with- out regard to whether the vessel there- after has proceeded to the United States in ballast or with cargo or pas- sengers laden or taken on board at the 2-cent port.

(3) The 6-cent rate shall be applied when the vessel proceeds from a 2-cent port to a 6-cent port en route to the United States under circumstances similar to paragraph (a) (1) or (2) of this section.

(4) If the vessel arrives in the United States with cargo or passengers taken at two or more ports to which different rates are applicable, tonnage tax shall be collected at the higher rate.

(b) The tonnage year shall be com- puted from the date of the first entry of the vessel concerned, without regard to the rate of the payment made at that entry, and shall expire on the day preceding the corresponding date of the following year. There may be 5 pay- ments at the maximum (6 cent) and 5 at the minimum (2-cent) rate during a tonnage year, so that the maximum as- sessment of tonnage duty may amount to 40 cent per net ton for the tonnage year of a vessel engaged in alternating trade.

(c) A vessel shall also be subject on every entry from a foreign port or place, whether or not regular tonnage tax is payable on the particular entry, to the payment of a special tonnage tax and to the payment of light money at the rates and under the cir- cumstances specified in the following table:

Classes of vessels

Rate per net ton

Regular tax Special tax Lightmoney

Vessels of the United States: 1. Under provisional register, without regard to citizenship of officers ................. $.02 or $.06 .................. .................. 2. All others:

(i) If all the officers are citizens ...................................................................... .02 or .06 .................. .................. (ii) If any officer is not a citizen ...................................................................... .02 or .06 1 0.50 1 .50

Undocumented vessels which are owned by citizens 2 ................................................ .02 or .06 .50 3 .50 Foreign vessels:

1. Of nations whose vessels are exempted from special tax or light money ....... .02 or .06 .................. .................. 2. All others:

(i) Built in the U.S ........................................................................................... .02 or .06 .30 .50 (ii) Not built in the U.S .................................................................................... .02 or .06 .50 .50 (iii) In addition to (i) or (ii) of 2., Foreign Vessels, when entering from a for-

eign port or place where vessels of the U.S. are not ordinarily permitted to enter and trade 3a .................................................................................... .02 or .06 4 2.00 4 .50

1 This does not apply on the first arrival of a vessel in a port of the United States from a foreign or intercoastal voyage if all the officers who are not citizens are below the grade of master and are filling vacancies which occurred on the voyage.

2 This special tax and light money do not apply if the vessel is documented as a vessel of the United States before leaving the port.

3 This does not apply if the vessel is under a certificate of protection and the owner or master files with the port director the oath required by 46 U.S.C. App. 129. An unrecorded bill of sale is not such a document as will exempt a vessel from the pay- ment of light money under 46 U.S.C. App. 128, and the recording of such bill of sale after the arrival of the vessel is not suffi- cient to relieve it from the payment of the tax.

3a The Democratic People’s Republic of Korea (North Korea), does not ordinarily permit vessels of the United States to enter and trade.

4 This is to be collected on each entry of a vessel from such a port or place.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00042 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

33

U.S. Customs and Border Protection, DHS; Treasury § 4.21

(d) Tonnage tax shall be imposed upon a vessel even though she enters a port of the United States only for or- ders.

(e) The fact that a vessel passes through the Panama Canal does not af- fect the rate of tonnage tax otherwise applicable to the vessel.

(f) For the purpose of computing ton- nage tax, the net tonnage of a vessel stated in the vessel’s marine document shall be accepted unless (1) such state- ment is manifestly wrong, in which case the net tonnage shall be esti- mated, pending admeasurement of the vessel, or the tonnage reported for her by any recognized classification soci- ety may be accepted, or (2) an appendix is attached to the marine document showing a net tonnage ascertained under the so-called ‘‘British rules’’ or the rules of any foreign country which have been accepted as substantially in accord with the rules of the United States, in which case the tonnage so shown may be accepted and the date the appendix was issued shall be noted on the tonnage tax certificate, Cus- toms Form 1002, and on the Vessel En- trance or Clearance Statement, Cus- toms Form 1300. For the purpose of computing tonnage tax on a vessel with a tonnage mark and dual ton- nages, the higher of the net tonnages stated in the vessel’s marine document or tonnage certificate shall be used un- less the Customs officer concerned is satisfied by report of the boarding offi- cer, statement or certificate of the master, or otherwise that the tonnage mark was not submerged at the time of arrival. Whether the vessel has a ton- nage mark, and if so, whether the mark was submerged on arrival, shall be noted on Customs Form 1300 by the boarding officer.

(g) The decision of the Commissioner of Customs is the final administrative decision on any question of interpreta- tion relating to the collection of ton- nage tax or to the refund of such tax when collected erroneously or illegally, and any question of doubt shall be re- ferred to him for instructions.

(h) Any person adversely affected by a decision of the Commissioner of Cus- toms relating to the collection of ton- nage tax, or to the refund of such tax when collected erroneously or illegally,

may appeal the decision in the Court of International Trade provided that the appeal action is commenced in accord- ance with the rules of the Court within 2 years after the cause of action first accrues.

[28 FR 14596, Dec. 31, 1963, as amended by T.D. 71–169, 36 FR 12603, July 2, 1971; T.D. 75– 110, 40 FR 21027, May 15, 1975; T.D. 76–280, 41 FR 42647, Sept. 28, 1976; T.D. 79–276, 44 FR 61956, Oct. 29, 1979; T.D. 82–145, 47 FR 35475, Aug. 16, 1982; T.D. 85–91, 50 FR 21429, May 24, 1985; T.D. 85–90, 50 FR 21430, May 24, 1985; T.D. 93–12, 58 FR 13196, Mar. 10, 1993; T.D. 95– 76, 60 FR 48028, Sept. 18, 1995; T.D. 97–82, 62 FR 51769, Oct. 3, 1997; T.D. 00–22, 65 FR 16515, Mar. 29, 2000; CBP Dec. 03–16, 68 FR 48280, Aug. 13, 2003]

§ 4.21 Exemptions from tonnage taxes. (a) Tonnage taxes and light money

shall be suspended in whole or in part whenever the President by proclama- tion shall so direct.

(b) The following vessels, or vessels arriving in the circumstances as de- fined below, shall be exempt from ton- nage tax and light money:

(1) It comes into port for bunkers (in- cluding water), sea stores, or ship’s stores; transacts no other business in the port; and departs within 24 hours after its arrival.

(2) It arrives in distress, even though required to enter.

(3) It is brought into port by orders of United States naval authorities and transacts no business while in port other than the taking on of bunkers, sea stores, or ship’s stores.

(4) It is a vessel of war or other vessel which is owned by, or under the com- plete control and management of the United States or the government of a foreign country, and which is not car- rying passengers or merchandise in trade or, if in ballast, which is not ar- riving from a foreign port during the usual course of its employment as a vessel engaged in trade.

(5) It is a yacht or other pleasure ves- sel not carrying passengers or mer- chandise in trade.

(6) It is engaged exclusively in sci- entific activities.

(7) It is engaged exclusively in laying or repairing cables.

(8) It is engaged in whaling or other fisheries, even though it may have en- tered a foreign port for fuel or supplies,

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00043 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

34

19 CFR Ch. I (4–1–12 Edition)§ 4.22

if it did not carry passengers or mer- chandise in trade.

(9) It is a passenger vessel making three trips or more a week between a port of the United States and a foreign port.

(10) It is used exclusively as a ferry boat, including a car ferry.

(11) It is a tug with a Great Lakes li- cense endorsement on its vessel docu- ment, when towing vessels which are required to make entry.

(12) It is a documented vessel with a Great Lakes license endorsement which has touched at an intermediate foreign port or ports during a coastwise voyage.

(13) It enters otherwise than by sea from a foreign port at which tonnage or lighthouse duties or equivalent taxes are not imposed on vessels of the United States (applicable only where the vessel arrives from a port in the province of Ontario, Canada).

(14) It is a coastwise-qualified vessel solely engaged in the coastwise trade (although arriving from a foreign port or place, it is engaged in the transpor- tation of merchandise or passengers, or the towing of a vessel other than a ves- sel in distress, between points in the U.S. via a foreign point) (see §§ 4.80, 4.80a, 4.80b, and 4.92).

(15) It is a vessel entering directly from the Virgin Islands (U.S.), Amer- ican Samoa, the islands of Guam, Wake, Midway, Canton, or Kingman Reef, or Guantanamo Bay Naval Sta- tion.

(16) It is a vessel making regular daily trips between any port of the United States and any port in Canada wholly upon interior waters not navi- gable to the ocean, except that such a vessel shall pay tonnage taxes upon her first arrival in each calendar year.

(17) It is a vessel arriving at a port in the United States which, while pro- ceeding between ports in the United States, touched at a foreign port under circumstances which would have ex- empted it from making entry under section 441(4), Tariff Act of 1930, as

amended (19 U.S.C. 1441(4)), had it touched at a United States port.

[28 FR 14596, Dec. 31, 1963, as amended by T.D. 72–264, 37 FR 20317, Sept. 29, 1972; T.D. 75–110, 40 FR 21027, May 15, 1975; T.D. 75–206, 40 FR 34586, Aug. 18, 1975; T.D. 79–276, 44 FR 61956, Oct. 29, 1979; T.D. 83–214, 48 FR 46512, Oct. 13, 1983; T.D. 93–12, 58 FR 13197, Mar. 10, 1993]

§ 4.22 Exemptions from special ton- nage taxes.

Vessels of the following nations are exempted by treaties, Presidential proclamations, or orders of the Sec- retary of the Treasury from the pay- ment of any higher tonnage duties than are applicable to vessels of the United States and are exempted from the payment of light money:

Algeria Antigua and Barbuda Arab Republic of

Egypt Argentina Australia Austria Bahamas, The Bahrain Bangladesh Barbados Belgium Belize Bermuda Bolivia Brazil Bulgaria Burma Canada Chile Colombia Cook Islands Costa Rica Cuba Cyprus Czechoslovakia Denmark (including

the Faeroe Islands) Dominica Dominican Republic Ecuador El Salvador Estonia Ethiopia Fiji Finland France Gambia, The German Democratic

Republic German Federal

Republic Ghana

Great Britain (including the Cayman Islands)

Greece Greenland Guatemala Guinea, Republic of Guyana Haiti Honduras Hong Kong Hungarian People’s

Republic Iceland India Indonesia Iran Iraq Ireland (Eire) Israel Italy Ivory Coast, Republic

of Jamaica Japan Kenya Korea Kuwait Latvia Lebanon Liberia Libya Lithuania Luxembourg Malaysia Malta Marshall Islands,

Republic of Mauritius Mexico Monaco Morocco Nauru, Republic of

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00044 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

35

U.S. Customs and Border Protection, DHS; Treasury § 4.24

Netherlands Netherlands Antilles New Zealand Nicaragua Nigeria Norway Oman Pakistan Panama Papua New Guinea Paraguay People’s Republic of

China Peru Philippines Poland Portugal Qatar Rumania Saudi Arabia Senegal Singapore, Republic Somali, Republic Spain Sri Lanka St. Vincent and The

Grenadines

Surinam, Republic of Sweden Switzerland Syrian Arab Republic Taiwan Thailand Togo Tonga Tunisia Turkey Tuvalu Union of South

Africa Union of Soviet

Socialist Republics United Arab

Emirates (Abu Dhabi, Ajman, Dubai, Fujairah, Ras Al Khaimah, Sharjah, and Umm Al Qaiwain)

Uruguay Vanuatu, Republic of Venezuela Yugoslavia Zaire

[28 FR 14596, Dec. 31, 1963]

EDITORIAL NOTE: For FEDERAL REGISTER ci- tations affecting § 4.22, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at www.fdsys.gov.

§ 4.23 Certificate of payment and cash receipt.

Upon each payment of tonnage tax or light money, the master of the vessel shall be given a certificate on Customs Form 1002 on which the control number of the cash receipt (Customs Form 368 or 368A) upon which payment was re- corded shall be written. This certifi- cate shall constitute the official evi- dence of such payment and shall be presented upon each entry during the tonnage year to establish the date of commencement of the tonnage year and to insure against overpayment. In the absence of the certificate, evidence of payment of tonnage tax shall be ob- tained from the port director to whom the payment was made.

[T.D. 85–71, 50 FR 15415, Apr. 18, 1985, as amended by T.D. 92–56, 57 FR 24943, June 12, 1992]

§ 4.24 Application for refund of ton- nage tax.

(a) The authority to make refunds in accordance with section 26 of the Act of June 26, 1884 (46 U.S.C. 8) of regular

tonnage taxes described in § 4.20(a) is delegated to the Directors of the ports where the collections were made. If any doubt exists, the case shall first be re- ferred to Headquarters, U.S. Customs Service for advice.

(b) Each application for refund of regular or special tonnage tax or light money prepared in accordance with this section shall be filed with the Cus- toms officer to whom payment was made. After verification of the perti- nent facts asserted in the claim, the application shall be forwarded with any necessary report or recommendation to the appropriate port director. Applica- tions for refund of special tonnage tax and light money (see § 4.20(c)) with the reports and recommendations sub- mitted therewith shall be forwarded by the port director to the Commissioner of Customs for decision. Any refund au- thorized by the Port Director under paragraph (a) of this section or any re- fund of special tonnae tax or light money authorized by the Commissioner of Customs shall be made by the appro- priate Customs officer. The records of tonnage tax shall be clearly noted to show each refund authorized.

(c) The application shall be a direct request for the refund of a definite sum, showing concisely the reasons therefor, the nationality and name of the vessel, and the date, place, and amount of each payment for which re- fund is requested. The application shall be made within 1 year from date of the payment. A protest against a payment shall not be accepted as an application for its refund.

(d) When the application is based upon a claim that more than five pay- ments of regular tax at either the 2- cent or the 6-cent rate have been made during a tonnage year, the application shall be supported by a statement from the appropriate Customs officer at the port where the application is submitted and from the appropriate Customs offi- cer at each port at which any claimed payment was made verifying the facts and showing in each case whether re- funds have been authorized.

(e) The application shall include a certificate by the owner or by the own- er’s agent that payment of tonnage tax at the applicable rate has been or will be made for each entry of the vessel on

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00045 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

36

19 CFR Ch. I (4–1–12 Edition)§ 4.30

a voyage on which that rate is applica- ble before the end of the current ton- nage year, exclusive of any payment which has been refunded or which may be refunded as a result of such applica- tion.

(f) The owner or operator of the ves- sel involved, or other party in interest, may file with the port Director a peti- tion addressed to the Commissioner of Customs for a review of the port direc- tor’s decision on an application for re- fund of regular tonnage tax. Such peti- tion shall be filed in duplicate within 30 days from the date of notice of the initial decision, shall completely iden- tify the case, and shall set forth in de- tail the exceptions to the decision.

[T.D. 71–274, 36 FR 21025, Nov. 3, 1971, as amended by T.D. 95–77, 60 FR 50010, Sept. 27, 1995]

LANDING AND DELIVERY OF CARGO

§ 4.30 Permits and special licenses for unlading and lading.

(a) Except as prescribed in paragraph (f), (g), or (k) of this section or in § 123.8 of this chapter, and except in the case of a vessel exempt from entry or clear- ance fees under 19 U.S.C. 288, no pas- sengers, cargo, baggage, or other arti- cle shall be unladen from a vessel which arrives directly or indirectly from any port or place outside the Cus- toms territory of the U.S., including the adjacent waters (see § 4.6 of this part), or from a vessel which transits the Panama Canal and no cargo, bag- gage, or other article shall be laden on a vessel destined to a port or place out- side the Customs territory of the U.S., including the adjacent waters (see § 4.6 of this part) if Customs supervision of such lading is required, until the port director shall have issued a permit or special license therefore on Customs Form 3171 or electronically pursuant to an authorized electronic data inter- change system or other means of com- munication approved by the Customs Service.

(1) U.S. and foreign vessels arriving at a U.S. port directly from a foreign port or place are required to make entry, whether it be formal or, as pro- vided in § 4.8, preliminary, before the port director may issue a permit or special license to lade or unlade.

(2) U.S. vessels arriving at a U.S. port from another U.S. port at which formal entry was made may be issued a permit or special license to lade or unlade without having to make either prelimi- nary or formal entry at the second and subsequent ports. Foreign vessels ar- riving at a U.S. port from another U.S. port at which formal entry was made may be issued a permit or special li- cense to lade or unlade at the second and subsequent ports prior to formal entry without the necessity of making preliminary entry. In these cir- cumstances, after the master has re- ported arrival of the vessel, the port di- rector may issue the permit or special license or may, in his discretion, re- quire the vessel to be boarded, the mas- ter to make an oath or affirmation to the truth of the statements contained in the vessel’s manifest to the Customs officer who boards the vessel, and re- quire delivery of the manifest prior to issuing the permit.

(b) Application for a permit or spe- cial license will be made by the master, owner, or agent of the vessel on Cus- toms Form 3171, or electronically pur- suant to an authorized electronic data interchange system or other means of communication approved by the Cus- toms Service, and will specifically indi- cate the type of service desired at that time, unless a term permit or term spe- cial license has been issued. Vessels that arrive in a Customs port with more than one vessel carrier sharing or leasing space on board the vessel (such as under a vessel sharing or slot char- ter arrangement) are required to indi- cate on the CF 3171 all carriers on board the vessel and indicate whether each carrier is transmitting its cargo declaration electronically or is pre- senting it on the Customs Form 1302. In the case of a term permit or term spe- cial license, upon entry of each vessel, a copy of the term permit or special li- cense must be submitted to Customs during official hours in advance of the rendering of services so as to update the nature of the services desired and the exact times they will be needed. Permits must also be updated to reflect any other needed changes including those in the name of the vessel as well as the slot charter or vessel sharing parties. An agent of a vessel may limit

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00046 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

37

U.S. Customs and Border Protection, DHS; Treasury § 4.30

62 ‘‘Before any such special license to unlade shall be granted, the master, owner, or agent of such vessel or vehicle, or the per- son in charge of such vehicle, shall be re- quired to deposit sufficient money to pay, or to give a bond in an amount to be fixed by the Secretary conditioned to pay, the com- pensation and expenses of the customs offi- cers and employees assigned to duty in con- nection with such unlading at night or on Sunday or a holiday, in accordance with the provisions of section 5 of the act of February 13, 1911, as amended (U.S.C. 1952 edition, title 19 sec. 267). In lieu of such deposit or bond the owner or agent of any vessel or vehicle or line of vessels or vehicles may execute a bond in an amount to be fixed by the Sec- retary of the Treasury to cover and include the issuance of special licenses for the unlad- ing of such vessels or vehicles for a period not to exceed one year. * * *’’ (Tariff Act of 1930, section 451, as amended, 19 U.S.C. 1451)

63-66 [Reserved]

his application to operations involved in the entry and unlading of the vessel or to operations involved in its lading and clearance. Such limitation will be specifically noted on the application.

(c) The request for a permit or a spe- cial license shall not be approved (pre- viously issued term permits or special licenses shall be revoked) unless the carrier complies with the provisions of paragraphs (l) and (m) of this section regarding terminal facilities and em- ployee lists, and the required cash de- posit or bond has been filed on Customs Form 301, containing the bond condi- tions set forth in § 113.64 of this chapter relating to international carriers. 62 When a carrier has on file a bond on Customs Form 301, containing the bond conditions set forth in § 113.63 of this chapter relating to basic custodial bond conditions, no further bond shall be required solely by reason of the un- lading or lading at night or on a Sun- day or holiday of merchandise or bag- gage covered by bonded transportation entries. Separate bonds shall be re- quired if overtime services are re- quested by different principals.

(d) Except as prescribed in paragraph (f) or (g) of this section, a separate ap- plication for a permit or special license shall be filed in the case of each ar- rival.

(e) Stevedoring companies and others concerned in lading or unlading mer- chandise, or in removing or otherwise securing it, shall ascertain that the ap-

plicable preliminary Customs require- ments have been complied with before commencing such operation, since per- formance in the absence of such com- pliance render them severally liable to the penalties prescribed in section 453, Tariff Act of 1930, even though they may not be responsible for taking the action necessary to secure compliance.

(f) The port director may issue a term permit on Customs Form 3171, which will remain in effect until re- voked by the port director, terminated by the carrier, or automatically can- celled by termination of the supporting continuous bond, to unlade merchan- dise, passengers, or baggage, or to lade merchandise or baggage during official hours.

(g) The port director may issue a term special license on Customs Form 3171, which will remain in effect until revoked by the port director, termi- nated by the carrier, or automatically cancelled by termination of the sup- porting continuous bond, to unlade merchandise, passengers, or baggage, or to lade merchandise or baggage dur- ing overtime hours or on a Sunday or holiday when Customs supervision is required. (See § 24.16 of this chapter re- garding pleasure vessels.)

(h) A special license for the unlading or lading of a vessel at night or on a Sunday or holiday shall be refused by the port director if the character of the merchandise or the conditions or facili- ties at the place of unlading or lading render the issuance of such special li- cense dangerous to the revenue. In no case shall a special license for unlading or lading at night or on a Sunday or holiday be granted except on the ground of commercial necessity.

(i) The port director shall not issue a permit or special license to unlade cargo or equipment of vessels arriving directly or indirectly from any port or place outside the United States, except on compliance with one or more of the following conditions:

(1) The merchandise shall have been duly entered and permits issued; or

(2) A bond on Customs Form 301, con- taining the bond conditions set forth in § 113.64 of this chapter relating to inter- national carriers, or cash deposit shall have been given; or

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00047 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

38

19 CFR Ch. I (4–1–12 Edition)§ 4.31

(3) The merchandise is to be dis- charged into the custody of the port di- rector as provided for in section 490(b), Tariff Act of 1930.

(j) Bonds are not required under this section for vessels owned by the United States and operated for its account.

(k) In the case of vessels of 5 net tons or over which are used exclusively as pleasure vessels and which arrive from any country, the port director in his discretion and under such conditions as he deems advisable may allow the re- quired application for unlading pas- sengers and baggage to be made orally, and may authorize his inspectors to grant oral permission for unlading at any time, and to grant requests on Cus- toms Form 3171 for overtime services.

(l) A permit to unlade pursuant to this part 4 or part 122 of this chapter shall not be granted unless the port di- rector determines that the applicant provides or the terminal at which the applicant will unlade the cargo pro- vides (1) sufficient space, capable of being locked, sealed, or otherwise se- cured, for the storage immediately upon unlading of cargo whose weight- to-value ratio renders it susceptible to theft or pilferage and of packages which have been broken prior to or in the course of unlading; and (2) an ade- quate number of vehicles, capable of being locked, sealed, or otherwise se- cured, for the transportation of such cargo or packages between the point of unlading and the point of storage. A term permit to unlade shall be revoked if the port director determines subse- quent to such issuance that the re- quirements of this paragraph have not been met.

(m) A permit to unlade pursuant to this part 4 or part 122 of this chapter shall not be granted to an importing carrier, and a term permit to unlade previously granted to such a carrier shall be revoked, (1) if such carrier, within 30 days after the date of receipt of a written demand by the port direc- tor, does not furnish a written list of the names, addresses, social security numbers, and dates and places of birth of persons it employs in connection with the unlading, storage and delivery of imported merchandise; or (2) if, hav- ing furnished such a list, the carrier does not advise the port director in

writing of the names, addresses, social security numbers, and dates and places of birth of any new personnel employed in connection with the unlading, stor- age and delivery of imported merchan- dise within 10 days after such employ- ment. If the employment of any such person is terminated, the carrier shall promptly advise the port director. For the purposes of this part, a person shall not be deemed to be employed by a car- rier if he is an officer or employee of an independent contractor engaged by a carrier to load, unload, transport or otherwise handle cargo.

(n) CBP will not issue a permit to unlade before it has received the cargo declaration information pursuant to § 4.7(b)(2) or (4) of this part. In cases in which CBP does not receive complete cargo declaration information from the carrier or a NVOCC in the manner, for- mat, and time frame required by § 4.7(b)(2) or (4), as appropriate, CBP may delay issuance of the permit to unlade the entire vessel until all re- quired information is received. CBP may also decline to issue a permit to unlade the specific cargo for which a cargo declaration is not received in a timely manner under § 4.7(b)(2) or (4). Further, where a carrier does not transmit a cargo declaration in the manner required by § 4.7(b)(2) or (4), preliminary entry pursuant to § 4.8(b) will be denied.

[28 FR 14596, Dec. 31, 1963]

EDITORIAL NOTE: For FEDERAL REGISTER ci- tations affecting § 4.30, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at www.fdsys.gov.

§ 4.31 Unlading or transshipment due to casualty.

(a) When any cargo or stores of a ves- sel have been unladen or transshipped at any place in the United States or its Customs waters other than a port of entry because of accident, stress of weather, or other necessity, no penalty shall be imposed under section 453 or 586(a), Tariff Act of 1930, if due notice is given to the director of the port at which the vessel thereafter first arrives and satisfactory proof is submitted to him as provided for in section 586(f), Tariff Act of 1930, as amended, regard- ing such accident, stress of weather, or

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00048 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

39

U.S. Customs and Border Protection, DHS; Treasury § 4.33

other necessity. The port director may accept the certificates of the master and two or more officers or members of the crew of the vessel, of whom the per- son next to the master in command shall be one, as proof that the unlading or transshipment was necessary by rea- son of unavoidable cause.

(b) The port director may then per- mit entry of the vessel and its cargo and permit the unlading of the cargo in such place at the port as he may deem proper. Unless its transportation has been in violation of the coastwise laws, the cargo may be cleared through Cus- toms at the port where it is discharged or forwarded to the port of original destination under an entry for imme- diate transportation or for transpor- tation and exportation, as the case may be. All regulations shall apply in such cases as if the unlading and deliv- ery took place at the port of original destination.

[28 FR 14596, Dec. 31, 1963, as amended by T.D. 95–77, 60 FR 50010, Sept. 27, 1995]

§ 4.32 Vessels in distress; landing of cargo.

(a) When a vessel from a foreign port arrives in distress at a port other than that to which it is destined, a permit to land merchandise or baggage may be issued if such action is necessary. Mer- chandise and baggage so unladen shall be taken into Customs custody and, if it has not been transported in violation of the coastwise laws, may be entered and disposed of in the same manner as any other imported merchandise or may be reladen without entry to be carried to its destination on the vessel from which it was unladen, subject only to charges for storage and safe- keeping.

(b) A bond on Customs Form 301, con- taining the bond conditions set forth in § 113.64 of this chapter relating to inter- national carriers shall be given in an amount to be determined by the port director to insure the proper disposi- tion of the cargo, whether such cargo be dutiable or free.

[28 FR 14596, Dec. 31, 1963, as amended by T.D. 84–213, 49 FR 41164, Oct. 19, 1984]

§ 4.33 Diversion of cargo. (a) Unlading at other than original port

of destination. A vessel may unlade cargo or baggage at an alternative port of entry to the port of original destina- tion if:

(1) It is compelled by any cause to put into the alternative port and the director of that port issues a permit for the unlading of cargo or baggage; or

(2) As a result of an emergency exist- ing at the port of destination, the port director authorizes the vessel to pro- ceed in accordance with the residue cargo bond procedure to the alter- native port. The owner or agent of the vessel shall apply for such authoriza- tion in writing, stating the reasons and agreeing to hold the port director and the Government harmless for the diver- sion.

(b) Disposition of cargo or baggage at emergency port. Cargo and baggage un- laden at the alternative port under the circumstances set forth in paragraph (a) of this section may be:

(1) Entered in the same manner as other imported cargo or baggage;

(2) Treated as unclaimed and stored at the risk and expense of its owner; or

(3) Reladen upon the same vessel without entry, for transportation to its original destination.

(c) Substitution of ports of discharge on manifest. After entry, the Cargo Dec- laration, Customs Form 1302, of a ves- sel may be changed at any time to per- mit discharge of manifested cargo at any domestic port in lieu of any other port shown on the Cargo Declaration, if:

(1) A written application for the di- version is made on the amended Cargo Declaration by the master, owner, or agent of the vessel to the director of the port where the vessel is located, after entry of the vessel at that port;

(2) An amended Cargo Declaration, under oath, covering the cargo, which it is desired to divert, is furnished in support of the application and is filed in such number of copies as the port di- rector shall require for local Customs purposes; and

(3) The certified traveling manifest is not altered or added to in any way by the master, owner, or agent of the ves- sel. When an application under para- graph (c)(1) of this section is approved,

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00049 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

40

19 CFR Ch. I (4–1–12 Edition)§ 4.34

67 See § 141.69(c) of this chapter for the con- ditions under which such merchandise and goods removed from a port of intended entry under these or certain other circumstances may subsequently be cleared under a con- sumption entry which had been filed there- fore before the merchandise was removed from the port of intended entry.

68-69 [Reserved]

the port director shall securely attach an approved copy of the amended mani- fest to the traveling manifest and shall send one copy of the amended Cargo Declaration to the director of the port where the vessel’s bond was filed.

(d) Retention of cargo on board for later return to the United States. If, as the re- sult of a strike or other emergency at a United States port for which inward foreign cargo is manifested, it is de- sired to retain the cargo on board the vessel for discharge at a foreign port but with the purpose of having the cargo returned to the United States, an application may be made by the mas- ter, owner, or agent of the vessel to amend the vessel’s Cargo Declaration, Customs Form 1302, under a procedure similar to that described in paragraph (c) of this section, except that a foreign port shall be substituted for the domes- tic port of discharge. If the application is approved, it shall be handled in the same manner as an application filed under paragraph (c) of this section. However, before approving the applica- tion, the port director is authorized to require such bond as he deems nec- essary to insure that export control laws and regulations are not cir- cumvented.

[T.D. 77–255, 42 FR 56320, Oct. 25, 1977]

§ 4.34 Prematurely discharged, over- carried, and undelivered cargo.

(a) Prematurely landed cargo. Upon re- ceipt of a satisfactory written applica- tion from the owner or agent of a ves- sel establishing that cargo was pre- maturely landed and left behind by the importing vessel through error or emergency, the port director may per- mit inward foreign cargo remaining on the dock to be reladen on the next available vessel owned or chartered by the owner of the importing vessel for transportation to the destination shown on the Cargo Declaration, Cus- toms Form 1302, of the first vessel, pro- vided the importing vessel actually en- tered the port of destination of the pre- maturely landed cargo. Unless so for- warded within 30 days from the date of landing, the cargo shall be appro- priately entered for Customs clearance or for forwarding in bond; otherwise, it shall be sent to general order as un- claimed. If the merchandise is so en-

tered for Customs clearance at the port of unlading, or if it is so forwarded in bond, other than by the importing ves- sel or by another vessel owned or char- tered by the owner of the importing vessel, representatives of the import- ing vessel shall file at the port of un- lading a Cargo Declaration in duplicate listing the cargo. The port director shall retain the original and forward the duplicate to the director of the originally intended port of discharge.

(b) Overcarried cargo. Upon receipt of a satisfactory written application by the owner or agent of a vessel estab- lishing that cargo was not landed at its destination and was overcarried to an- other domestic port through error or emergency, the port director may per- mit the cargo to be returned in the im- porting vessel, or in another vessel owned or chartered by the owner of the importing vessel, to the destination shown on the Cargo Declaration, Cus- toms Form 1302, of the importing ves- sel, provided the importing vessel actu- ally entered the port of destination. 67

(c) Inaccessibly stowed cargo. Cargo so stowed as to be inaccessible upon ar- rival at destination may be retained on board, carried forward to another do- mestic port or ports, and returned to the port of destination in the import- ing vessel or in another vessel owned or chartered by the owner of the import- ing vessel in the same manner as other overcarried cargo.

(d) Application for forwarding cargo. When it is desired that prematurely landed cargo, overcarried cargo, or cargo so stowed as to be inaccessible, be forwarded to its destination by the importing vessel or by another vessel owned or chartered by the owner of the importing vessel in accordance with paragraph (a), (b), or (c) of this section, the required application shall be filed with the local director of the port of premature landing or overcarriage by the owner or agent of the vessel. The

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00050 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

41

U.S. Customs and Border Protection, DHS; Treasury § 4.36

application shall be supported by a Cargo Declaration, Customs Form 1302, in such number of copies as the port di- rector may require. Whenever prac- ticable, the application shall be made on the face of the Cargo Declaration below the description of the merchan- dise. The application shall specify the vessel on which the cargo was im- ported, even though the forwarding to destination is by another vessel owned or chartered by the owner of the im- porting vessel, and all ports of depar- ture and dates of sailing of the import- ing vessel. The application shall be stamped and signed to show that it has been approved.

(e) Manifesting prematurely landed or overcarried cargo. One copy of the Cargo Declaration, Customs Form 1302, shall be certified by Customs for use as a substitute traveling manifest for the prematurely landed or overcarried cargo being forwarded as residue cargo, whether or not the forwarding vessel is also carrying other residue cargo. If the application for forwarding is made on the Cargo Declaration, the new sub- stitute traveling manifest shall be stamped to show the approval of the application. If the application is on a separate document, a copy thereof, stamped to show its approval, shall be attached to the substitute traveling manifest. An appropriate cross-ref- erence shall be placed on the original traveling manifest to show that the vessel has one or more substitute trav- eling manifests. A permit to proceed endorsed on a Vessel Entrance or Clearance Statement, Customs Form 1300, issued to the vessel transporting the prematurely landed or overcarried cargo to its destination shall make ref- erence to the nature of such cargo, identifying it with the importing ves- sel.

(f) Residue cargo procedure. A vessel with prematurely landed or overcarried cargo on board shall comply upon ar- rival at all domestic ports of call with all the requirements of part 4 relating to foreign residue cargo for domestic ports. The substitute traveling mani- fest, carried forward from port to port by the oncarrying vessel, shall be fi- nally surrendered at the port where the last portion of the prematurely landed or overcarried cargo is discharged.

(g) Cargo undelivered at foreign port and returned to the U.S. Merchandise shipped from a domestic port, but un- delivered at the foreign destination and returned, shall be manifested as ‘‘Un- delivered-to be returned to original for- eign destination,’’ if such a return is intended. The port director may issue a permit to retain the merchandise on board, or he may, upon written applica- tion of the steamship company, issue a permit on a Delivery Ticket, Customs Form 6043, allowing the merchandise to be transferred to another vessel for re- turn to the original foreign destina- tion. No charge shall be made against the bond on Customs Form 301, con- taining the bond conditions relating to international carriers set forth in § 113.64 of this chapter. The items shall be remanifested outward and an ex- planatory reference of the attending circumstances and compliance with ex- port requirements noted.

[28 FR 14596, Dec. 31, 1963, as amended by T.D. 77–255, 42 FR 56321, Oct. 25, 1977; T.D. 85– 123, 50 FR 29952, July 23, 1985; T.D. 95–77, 60 FR 50010, Sept. 27, 1995; T.D. 00–22, 65 FR 16515, Mar. 29, 2000]

§ 4.35 Unlading outside port of entry.

(a) Upon written application from the interested party, the port director con- cerned, if he considers it necessary, may permit any vessel laden with mer- chandise in bulk to proceed, after entry, to any place outside the port where the vessel entered which such port director may designate for the purpose of unlading such cargo.

(b) In such case a deposit of a sum sufficient to reimburse the Govern- ment for the compensation, travel, and subsistence expenses of the officers de- tailed to supervise the unlading and de- livery of the cargo may be required by the port director.

[28 FR 14596, Dec. 31, 1963, as amended at T.D. 95–77, 60 FR 50010, Sept. 27, 1995]

§ 4.36 Delayed discharge of cargo.

(a) When pursuant to section 457, Tariff Act of 1930, customs officers are placed on a vessel which has retained merchandise on board more than 25 days after the date of the vessel’s ar- rival, their compensation and subsist- ence expenses shall be reimbursed to

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00051 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

42

19 CFR Ch. I (4–1–12 Edition)§ 4.37

70 ‘‘The limitation of time for unlading shall not extend to vessels laden exclusively with merchandise in bulk consigned to one consignee and arriving at a port for orders, but if the master of such vessel requests a longer time to discharge its cargo, the com- pensation of the inspectors or other customs officers whose services are required in con- nection with the unlading shall, for every day consumed in unlading in excess of twen- ty-five (25) days from the date of the vessel’s entry, be reimbursed by the master or owner of such vessel.’’ (Tariff Act of 1930, sec. 458; 19 U.S.C. 1458)

71-75 [Reserved]

the Government by the owner or mas- ter.

(b) The compensation of all Customs officers and employees assigned to su- pervise the discharge of a cargo within the purview of section 458, Tariff Act of 1930, 70 after the expiration of 25 days after the date of the vessel’s entry shall be reimbursed to the Government by the owner or master of the vessel.

(c) When cargo is manifested ‘‘for or- ders’’ upon the arrival of the vessel, no amendment of the manifest to show an- other port of discharge shall be per- mitted after 15 days after the date of the vessel’s arrival, except as provided for in § 4.33.

(d) All reimbursements payable in ac- cordance with this section shall be paid or secured to the port director before clearance is granted to the vessel.

[28 FR 14596, Dec. 31, 1963, as amended by T.D. 95–77, 60 FR 50010, Sept. 27, 1995; T.D. 98– 74, 63 FR 51287, Sept. 25, 1998]

§ 4.37 General order. (a) Any merchandise or baggage regu-

larly landed but not covered by a per- mit for its release shall be allowed to remain at the place of unlading until the fifteenth calendar day after land- ing. No later than 20 calendar days after landing, the master or owner of the vessel or the agent thereof shall notify Customs of any such merchan- dise or baggage for which entry has not been made. Such notification shall be provided in writing or by any appro- priate Customs-authorized electronic data interchange system. Failure to provide such notification may result in assessment of a monetary penalty of up to $1,000 per bill of lading against the master or owner of the vessel or the

agent thereof. If the value of the mer- chandise on the bill is less than $1,000, the penalty shall be equal to the value of such merchandise.

(b) Any merchandise or baggage that is taken into custody from an arriving carrier by any party under a Customs- authorized permit to transfer or in- bond entry may remain in the custody of that party for 15 calendar days after receipt under such permit to transfer or 15 calendar days after arrival at the port of destination. No later than 20 calendar days after receipt under the permit to transfer or 20 calendar days after arrival under bond at the port of destination, the party shall notify Cus- toms of any such merchandise or bag- gage for which entry has not been made. Such notification shall be pro- vided in writing or by any appropriate Customs-authorized electronic data interchange system. If the party fails to notify Customs of the unentered merchandise or baggage in the allotted time, he may be liable for the payment of liquidated damages under the terms and conditions of his custodial bond (see § 113.63(c)(4) of this chapter).

(c) In addition to the notification to Customs required under paragraphs (a) and (b) of this section, the carrier (or any other party to whom custody of the unentered merchandise has been transferred by a Customs authorized permit to transfer or in-bond entry) shall provide notification of the pres- ence of such unreleased and unentered merchandise or baggage to a bonded warehouse certified by the port direc- tor as qualified to receive general order merchandise. Such notification shall be provided in writing or by any appro- priate Customs-authorized electronic data interchange system and shall be provided within the applicable 20-day period specified in paragraph (a) or (b) of this section. It shall then be the re- sponsibility of the bonded warehouse proprietor to arrange for the transpor- tation and storage of the merchandise or baggage at the risk and expense of the consignee. The arriving carrier (or other party to whom custody of the merchandise was transferred by the ar- riving carrier under a Customs-author- ized permit to transfer or in-bond entry) is responsible for preparing a Customs Form (CF) 6043 (Delivery

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00052 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

43

U.S. Customs and Border Protection, DHS; Treasury § 4.38

Ticket), or other similar Customs doc- ument designated by the port director or an electronic equivalent as author- ized by Customs, to cover the propri- etor’s receiptof the merchandise and its transport to the warehouse from the custody of the arriving carrier (or other party to whom custody of the merchandise was transferred by the carrier under a Customs-authorized permit to transfer or in-bond entry) (see § 19.9 of this chapter). Any unentered merchandise or baggage shall remain the responsibility of the carrier, master, or person in charge of the importing vessel or the agent thereof or party to whom the merchan- dise has been transferred under a Cus- toms authorized permit to transfer or in-bond entry, until it is properly transferred from his control in accord- ance with this paragraph. If the party to whom custody of the unentered mer- chandise or baggage has been trans- ferred by a Customs-authorized permit to transfer or in-bond entry fails to no- tify a Customs-approved bonded ware- house of such merchandise or baggage within the applicable 20-calendar-day period, he may be liable for the pay- ment of liquidated damages of $1,000 per bill of lading under the terms and conditions of his international carrier or custodial bond (see §§ 113.63(b), 113.63(c) and 113.64(b) of this chapter).

(d) If a carrier or any other party to whom custody of the unentered mer- chandise has been transferred by means of a Customs-authorized permit to transfer or in-bond entry fails to time- ly relinquish custody of the merchan- dise to a Customs-approved bonded General Order warehouse, the carrier or other party may be liable for liq- uidated damages equal to the value of that merchandise under the terms and conditions of his international carrier or custodial bond, as applicable.

(e) If the bonded warehouse operator fails to take possession of unentered and unreleased merchandise or baggage within five calendar days after receipt of notification of the presence of such merchandise or baggage under this sec- tion, he may be liable for the payment of liquidated damages under the terms and conditions of his custodial bond (see § 113.63(a)(1) of this chapter). If the port director finds that the warehouse

operator cannot accept the goods be- cause they are required by law to be exported or destroyed (see § 127.28 of this chapter), or for other good cause, the goods will remain in the custody of the arriving carrier or other party to whom the goods have been transferred under a Customs-authorized permit to transfer or in-bond entry. In this event, the carrier or other party will be re- sponsible under bond for exporting or destroying the goods, as necessary (see §§ 113.63(c)(3) and 113.64(b) of this chap- ter).

(f) In ports where there is no bonded warehouse authorized to accept general order merchandise or if merchandise requires specialized storage facilities which are unavailable in a bonded fa- cility, the port director, after having received notice of the presence of unentered merchandise or baggage in accordance with the provisions of this section, shall direct the storage of the merchandise by the carrier or by any other appropriate means.

(g) Whenever merchandise remains on board any vessel from a foreign port more than 25 days after the date on which report of arrival of such vessel was made, the port director, as pre- scribed in section 457, Tariff Act of 1930, as amended (19 U.S.C. 1457), may take possession of such merchandise and cause it to be unladen at the ex- pense and risk of the owners of the merchandise. Any merchandise so un- laden shall be sent forthwith by the port director to a general order ware- house and stored at the risk and ex- pense of the owners of the merchan- dise.

(h) Merchandise taken into the cus- tody of the port director pursuant to section 490(b), Tariff Act of 1930, as amended (19 U.S.C. 1490(b)), shall be sent to a general order warehouse after 1 day after the day the vessel was en- tered, to be held there at the risk and expense of the consignee.

[T.D. 98–74, 63 FR 51287, Sept. 25, 1998, as amended by T.D. 02–65, 67 FR 68032, Nov. 8, 2002]

§ 4.38 Release of cargo. (a) No imported merchandise shall be

released from Customs custody until a permit to release such merchandise has been granted. Such permit shall be

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00053 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

44

19 CFR Ch. I (4–1–12 Edition)§ 4.38

issued by the port director only after the merchandise has been entered and, except as provided for in § 141.102(d) or part 142 of this chapter, the duties thereon, if any, have been estimated and paid. Generally, the permit shall consist of a document authorizing de- livery of a particular shipment or an electronic equivalent. Alternatively, the permit may consist of a report which lists those shipments which have been authorized for release. This alter- native cargo release notification may be used when the manifest is not filed by the carrier through the Automated Manifest System, the entry has been filed through the Automated Broker Interface, and Customs has approved the cargo for release without submis- sion of paper documents after review- ing the entry data submitted electroni- cally through ABI and its selectivity criteria (see § 143.34). The report shall be posted in a conspicuous area to which the public has access in the cus- tomhouse at the port of entry where the cargo was imported.

(1) Where the cargo arrives by vessel, the report shall consist of the following data elements:

(i) Vessel name or code, if trans- mitted by the entry filer;

(ii) Carrier code; (iii) Voyage number, if transmitted

by the entry filer; (iv) Bill of lading number; (v) Quantity released; and (vi) Entry number (including filer

code). (2) Where the cargo arrives by air,

the report shall consist of the following data elements:

(i) Air waybill number; (ii) Quantity released; (iii) Entry number (including filer

code); (iv) Carrier code; and (v) Flight number, if transmitted by

the entry filer. (3) In the case of merchandise trav-

eling via in-bond movement, the report will contain the following data ele- ments:

(i) Immediate transportation bond number;

(ii) Carrier code; (iii) Quantity released; and (iv) Entry number (including filer

code).

When merchandise is released without proper permit before entry has been made, the port director shall issue a written demand for redelivery. The car- rier or facility operator shall redeliver the merchandise to Customs within 30 days after the demand is made. The port director may authorize unentered merchandise brought in by one carrier for the account of another carrier to be transferred within the port to the lat- ter carrier’s facility. Upon receipt of the merchandise the latter carrier as- sumes liability for the merchandise to the same extent as though the mer- chandise had arrived on its own vessel.

(b) When packages of merchandise bear marks or numbers which differ from those appearing on the Cargo Dec- laration, Customs Form 1302, of the im- porting vessel for the same packages and the importer or a receiving bonded carrier, with the concurrence of the importing carrier, makes application for their release under such marks or numbers, either for consumption or for transportation in bond under an entry filed therefor at the port of discharge from the importing vessel, the port di- rector may approve the application upon condition that (1) the contents of the packages be identified with an in- voice or transportation entry as set forth below and (2) the applicant fur- nish at his own expense any bonded cartage or lighterage service which the granting of the application may re- quire. The application shall be in writ- ing in such number of copies as may be required for local Customs purposes. Before permitting delivery of packages under such an application, the port di- rector shall cause such examination thereof to be made as will reasonably identify the contents with the invoice filed with the consumption entry. If the merchandise is entered for trans- portation in bond without the filing of an invoice, such examination shall be made as will reasonably identify the contents of the packages with the transportation entry.

(c) If the port director determines that, in a port or portion of a port, the volume of cargo handled, the incidence of theft or pilferage, or any other fac- tor related to the protection of mer- chandise in Customs custody requires such measures, he shall require as a

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00054 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

45

U.S. Customs and Border Protection, DHS; Treasury § 4.39

condition to the granting of a permit to release imported merchandise that the importer or his agent present to the carrier or his agent a fully exe-

cuted pickup order in substantially the following format, in triplicate, to ob- tain delivery of any imported merchan- dise:

The pickup order shall contain a duly authenticated customhouse broker’s signature, unless it is presented by a person properly identified as an em- ployee or agent of the ultimate con- signee. When delivered quantities are verified by a Customs officer, he shall certify all copies of the pickup order, returning one to the importer or his agent and two to the carrier making delivery.

(d) When the provisions of paragraph (c) of this section are invoked by the port director and verification of deliv- ered quantities by Customs is required, a permit to release merchandise shall be effective as a release from Customs custody at the time that the delivery of the merchandise covered by the pickup order into the physical posses- sion of a subsequent carrier or an im- porter or the agent of either is com- pleted under the supervision of a Cus- toms officer, and only to the extent of the actual delivery of merchandise de-

scribed in such pickup order as verified by such Customs officer.

[28 FR 14596, Dec. 31, 1963, as amended by T.D. 71–39, 36 FR 1892, Feb. 3, 1971; T.D. 77– 255, 42 FR 56321, Oct. 25, 1977; T.D. 91–46, 56 FR 22330, May 15, 1991; 56 FR 27559, June 14, 1991]

§ 4.39 Stores and equipment of vessels and crews’ effects; unlading or lad- ing and retention on board.

(a) The provisions of § 4.30 relating to unlading under a permit on Customs Form 3171 are applicable to the unlad- ing of articles, other than cargo or bag- gage, which have been laden on a vessel outside the Customs territory of the United States, regardless of the trade in which the vessel may be engaged at the time of unlading, except that such provisions do not apply to such articles which have already been entered.

(b) Any articles other than cargo or baggage landed for delivery for con- sumption in the United States shall be treated in the same manner as other imported articles. A notation as to the landing of such articles, together with

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00055 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150 EC 14

N O

91 .1

67 <

/G P

H >

46

19 CFR Ch. I (4–1–12 Edition)§ 4.40

76 ‘‘* * * The underwriters of abandoned merchandise and the salvors of merchandise saved from a wreck at sea or on or along a coast of the United States may be regarded as the consignees.’’* * * (Tariff Act of 1930, sec. 483; 19 U.S.C. 1483)

the number of the entry made therefor, shall be made on the vessel’s store list, but such notation shall not subject the articles to the requirement of being in- cluded in a post entry to the manifest.

(c) Bags or dunnage constituting equipment of a vessel may be landed temporarily and reladen on such vessel under Customs supervision without entry.

(d) Articles claimed to be sea or ships’ stores which are in excess of the reasonable requirements of the vessel on which they are found shall be treat- ed as cargo of such vessel.

(e) Under section 446, Tariff Act of 1930, port directors may permit nar- cotic drugs, except smoking opium, in reasonable quantities and properly list- ed as medical stores to remain on board vessels if satisfied that such drugs are adequately safeguarded and used only as medical supplies.

(f) Application for permission to transfer bunkers, stores or equipment as provided for in the proviso to sec- tion 446, Tariff Act of 1930, shall be made and the permit therefor granted on Customs Form 3171.

(g) Equipment of a vessel arriving ei- ther directly or indirectly from a for- eign port or place, if in need of repairs in the United States, may be unladen from and reladen upon the same vessel under the procedures set forth in § 4.30 relating to the granting of permits and special licenses on Customs Form 3171 (CF 3171). Adequate protection of the revenue is insured under the appro- priate International Carrier Bond dur- ing the period that equipment is tem- porarily landed for repairs (see § 113.64(b) of this chapter), and so resort to the procedures established for the temporary importation of merchandise under bond is unnecessary. Once equip- ment which has been unladen under the terms of a CF 3171 has been reladen on the same vessel, potential liability for that transaction existing under the bond will be extinguished.

[28 FR 14596, Dec. 31, 1963, as amended by T.D. 93–66, 58 FR 44130, Aug. 19, 1993; T.D. 00– 61, 65 FR 56790, Sept. 20, 2000]

§ 4.40 Equipment, etc., from wrecked or dismantled vessels.

Ship’s or sea stores, supplies, and equipment of a vessel wrecked either in

the waters of the United States or out- side such waters, on being recovered and brought into a United States port, and like articles landed from a vessel dismantled in a United States port shall be subject to the same Customs treatment as would apply if the arti- cles were landed from a vessel arriving in the ordinary course of trade. Parts of the hull and fittings recovered from a vessel which arrived in the United States in the course of navigation and was wrecked in the waters of the United States or was dismantled in this country are free of duties and im- port taxes, but if such articles are re- covered from vessels outside the waters of the United States and brought into a United States port, they shall be treat- ed as imported merchandise.

§ 4.41 Cargo of wrecked vessel. (a) Any cargo landed from a vessel

wrecked in the waters of the United States or on the high seas shall be sub- ject at the port of entry to the same entry requirements and privileges as the cargo of a vessel regularly arriving in the foreign trade. In lieu of a Cargo Declaration, Customs Form 1302, to cover such cargo, the owner, under- writer (if the merchandise has been abandoned to him), or the salvor of the merchandise shall make entry on Cus- toms Form 7501, and any such appli- cant shall be regarded as the consignee of the merchandise for Customs pur- poses. 76

(b) All such merchandise shall be taken into possession by the director of the port where it shall first arrive and be retained in his custody pending entry. If it is not entered by the person entitled to make entry, or is not dis- posed of pursuant to court order, it shall be subject to sale as unclaimed merchandise.

(c) If such merchandise is from a ves- sel which has been sunk in waters of the United States for 2 years or more and has been abandoned by the owner, any person who has salvaged the cargo

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00056 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

47

U.S. Customs and Border Protection, DHS; Treasury § 4.52

77 ‘‘Whenever any vessel laden with mer- chandise, in whole or in part subject to duty, has been sunk in any river, harbor, bay, or waters subject to the jurisdiction of the United States, and within its limits, for the period of two years and is abandoned by the owner thereof, any person who may raise such vessel shall be permitted to bring any merchandise recovered therefrom into the port nearest to the place where such vessel was so raised free from the payment of any duty thereupon, but under such regulations as the Secretary of the Treasury may pre- scribe.’’ (Tariff Act of 1930, sec. 310; 19 U.S.C. 1310)

78 Salvors have an uncertain interest in the goods salved, dependent upon the decree of a competent tribunal, and have a presumptive right without such decree to possession of merchandise salved by them from abandoned wrecks. The salvors are entitled in either case to make entry of derelict or wrecked goods.

79-103 [Reserved]

shall be permitted to enter the mer- chandise at the port where the vessel was wrecked free of duty upon the facts being established to the satisfaction of the director of the port of entry. 77 Any other such merchandise is subject to the same tariff classification as like merchandise regularly imported in the ordinary course of trade.

(d) If the merchandise is libeled for salvage, 78 the port director shall notify the United States attorney of the claim of the United States for duties, and request him to intervene for such duties.

[28 FR 14596, Dec. 31, 1963, as amended by T.D. 77–255, 42 FR 56321, Oct. 25, 1977; T.D. 87– 75, 52 FR 20066, May 29, 1987; T.D. 95–77, 60 FR 50010, Sept. 27, 1995; T.D. 99–27, 64 FR 13675, Mar. 22, 1999]

PASSENGERS ON VESSELS

§ 4.50 Passenger lists. (a) The master of every vessel arriv-

ing at a port of the United States from a port or place outside the Customs territory (see § 4.6 of this part) and re- quired to make entry, except a vessel arriving from Canada, otherwise than by sea, at a port on the Great Lakes, or their connections or tributary waters, shall submit passenger and crew lists, as required by § 4.7(a) of this part. If the vessel is arriving from noncontig- uous foreign territory and is carrying steerage passengers, the additional in-

formation respecting such passengers required by Customs and Immigration Form I–418 shall be included therein.

(b) A passenger within the meaning of this part is any person carried on a vessel who is not connected with the operation of such vessel, her naviga- tion, ownership, or business.

[28 FR 14596, Dec. 31, 1963 as amended by T.D. 71–169, 36 FR 12603, July 2, 1971; T.D. 82–145, 47 FR 35475, Aug. 16, 1982; T.D. 93–96, 58 FR 67316, Dec. 21, 1993]

§ 4.51 Reporting requirements for indi- viduals arriving by vessel.

(a) Arrival of vessel reported. Individ- uals on vessels, which have reported their arrival to Customs in accordance with19 U.S.C. 1433 and § 4.2 of this part, shall remain on board until authorized by Customs to depart. Upon departing the vessel, such individuals shall im- mediately report to a designated Cus- toms location together with all of their accompanying articles.

(b) Arrival of vessel not reported. Indi- viduals on vessels, which have not re- ported their arrival to Customs in ac- cordance with 19 U.S.C. 1433 and § 4.2 of this part, shall immediately notify Customs and report their arrival to- gether with appropriate information regarding the vessel, and shall present themselves and their accompanying ar- ticles at a designated Customs loca- tion.

(c) Departure from designated Customs location. Individuals required to report to designated Customs locations under this section shall not depart from such locations until authorized to do so by any appropriate Customs officer.

[T.D. 93–96, 58 FR 67316, Dec. 21, 1993]

§ 4.52 Penalties applicable to individ- uals.

Individuals violating any of the re- porting requirements of § 4.51 of this part or who present any forged, al- tered, or false document or paper to Customs in connection with this sec- tion, may be liable for certain civil penalties, as provided under 19 U.S.C. 1459, in addition to other penalties ap- plicable under other provisions of law. Further, if the violation of these re- porting requirements is intentional, upon conviction, additional criminal

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00057 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

48

19 CFR Ch. I (4–1–12 Edition)§ 4.60

penalties may be applicable, as pro- vided by under 19 U.S.C. 1459, in addi- tion to other penalties applicable under other provisions of law.

[T.D. 93–96, 58 FR 67317, Dec. 21, 1993; 59 FR 1918, Jan. 13, 1994]

FOREIGN CLEARANCES

§ 4.60 Vessels required to clear.

(a) Unless specifically excepted by law, the following vessels must obtain clearance from CBP before departing from a port or place in the United States:

(1) All vessels departing for a foreign port or place;

(2) All foreign vessels departing for another port or place in the United States;

(3) All American vessels departing for another port or place in the United States that have foreign merchandise for which entry has not been made; and

(4) All vessels departing for points outside the territorial sea to visit a hovering vessel or to receive merchan- dise or passengers while outside the territorial sea, as well as foreign ves- sels delivering merchandise or pas- sengers while outside the territorial sea.

(b) The following vessels are not re- quired to clear:

(1) A documented vessel with a pleas- ure license endorsement or an undocu- mented American pleasure vessel (i.e., an undocumented vessel wholly owned by a United States citizen or citizens, whether or not it has a certificate of number issued by the State in which the vessel is principally used under 46 U.S.C. 1466–1467 and not engaged in trade nor violating the customs or navigation laws of the United States and not having visited any hovering vessel (see 19 U.S.C. 1709(d)).

(2) A vessel exempted from entry by section 441, Tariff Act of 1930. (See § 4.5.)

(3) A vessel of less than 5 net tons which departs from the United States to proceed to a contiguous country otherwise than by sea.

(c) Vessels which will merely transit the Panama Canal without transacting any business there will not be required to be cleared because of such transit.

(d) In the event that departure is de- layed beyond the second day after clearance, the delay must be reported within 72 hours after clearance to the port director who will note the fact of detention on the certificate of clear- ance and on the official record of clear- ance. When the proposed voyage is can- celed after clearance, the reason there- for must be reported in writing within 24 hours after such cancellation and the certificate of clearance and related papers must be surrendered.

(e) No vessel will be cleared for the high seas except, a vessel bound to an- other vessel on the high seas to—

(1) Transship export merchandise which it has transported from the U.S. to the vessel on the high seas; or

(2) Receive import merchandise from the vessel on the high seas and trans- port the merchandise to the U.S.

[28 FR 14596, Dec. 31, 1963, as amended by T.D. 79–276, 44 FR 61956, Oct. 29, 1979; T.D. 83– 214, 48 FR 46512, Oct. 13, 1983; T.D. 85–91, 50 FR 21429, May 24, 1985; T.D. 94–24, 59 FR 13200, Mar. 21, 1994; T.D. 95–77, 60 FR 50010, Sept. 27, 1995; T.D. 00–4, 65 FR 2873, Jan. 19, 2000; CBP Dec. 08-25, 73 FR 40725, July 16, 2008; CBP Dec. 10–33, 75 FR 69585, Nov. 15, 2010]

§ 4.61 Requirements for clearance. (a) Application for clearance. A clear-

ance application for a vessel intending to depart for a foreign port must be made by filing Customs Form 1300 (Vessel Entrance or Clearance State- ment) executed by the vessel master or other proper officer. The master, li- censed deck officer, or purser may ap- pear in person to clear the vessel, or the properly executed Customs Form 1300 may be delivered to the custom- house by the vessel agent or other per- sonal representative of the master. Necessary information may also be transmitted electronically pursuant to a system authorized by Customs. Clear- ance will be granted by Customs either on the Customs Form 1300 or by ap- proved electronic means. Customs port directors may permit the clearance of vessels at locations other than the cus- tomhouse, and at times outside of nor- mal business hours. Customs may take local resources into consideration in allowing clearance to be transacted on board vessels themselves or at other mutually convenient sites and times

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00058 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

49

U.S. Customs and Border Protection, DHS; Treasury § 4.61

either within or outside of port limits. Customs must be satisfied that the place designated for clearance is suffi- ciently under Customs control at the time of clearance, and that the ex- penses incurred by Customs will be re- imbursed as authorized. Customs may require that advance notice of vessel departure be given prior to granting re- quests for optional clearance locations.

(b) When clearance required. Under certain circumstances, American ves- sels departing from ports of the United States directly for other United States ports must obtain Customs clearance. The clearance of such vessels is re- quired when they have merchandise aboard which is being transported in- bond, or when they have unentered for- eign merchandise aboard. For the pur- poses of the vessel clearance require- ments, merchandise transported in- bond does not include bonded ship’s stores or supplies. While American ves- sels transporting unentered foreign merchandise must fully comply with usual clearance procedures, American vessels carrying no unentered foreign merchandise but that have in-bond merchandise aboard may satisfy vessel clearance requirements by reporting intended departure within 72 hours prior thereto by any means of commu- nication that is satisfactory to the local Customs port director, and by presenting a completed Customs Form 1300 (Vessel Entrance or Clearance Statement). Also, the Customs officer may require the production of any doc- uments or papers deemed necessary for the proper inspection/examination of the vessel, cargo, passenger, or crew. Report of departure together with pro- viding information to Customs as spec- ified in this paragraph satisfies all clearance requirements for the subject vessels.

(c) Verification of compliance. Before clearance is granted to a vessel bound to a foreign port as provided in § 4.60 and this section, the port director will verify compliance with respect to the following matters:

(1) Accounting for inward cargo (see § 4.62).

(2) Outward Cargo Declarations; ship- pers export declarations (see § 4.63).

(3) Documentation (see § 4.0(c)).

(4) Verification of nationality and tonnage (see § 4.65).

(5) Verification of inspection (see § 4.66).

(6) Inspection under State laws (46 U.S.C. App. 97).

(7) Closed ports or places (see § 4.67). (8) Passengers (see § 4.68). (9) Shipping articles and enforcement

of Seamen’s Act (see § 4.69). (10) Medicine and slop chests. (11) Load line regulations (see § 4.65a). (12) Carriage of United States securi-

ties, etc. (46 U.S.C. App. 98). (13) Carriage of mail. (14) Public Health regulations (see

§ 4.70). (15) Inspection of vessels carrying

livestock (see § 4.71). (16) Inspection of meat, meat-food

products, and inedible fats (see § 4.72). (17) Neutrality exportation of arms

and munitions (see § 4.73). (18) Payment of State and Federal

fees and fees due the Government of the Virgin Islands of the United States (46 U.S.C. App. 100).

(19) Orders restricting shipping (see § 4.74).

(20) Estimated duties deposited or a bond given to cover duties on foreign repairs and equipment for vessels of the United States (see § 4.14).

(21) Illegal discharge of oil (see § 4.66a).

(22) Attached or arrested vessel. (23) Immigration laws. (24) Electronic receipt of required

vessel cargo information (see § 192.14(c) of this chapter).

(d) Vessel built for foreign account. A new vessel built in the United States for foreign account will be cleared under a certificate of record, Coast Guard Form 1316, in lieu of a marine document.

(e) Clearance not granted. Clearance will not be granted to any foreign ves- sel using the flag of the United States or any distinctive signs or markings indicating that the vessel is an Amer- ican vessel (22 U.S.C. 454a).

(f) Clearance in order of itinerary. Un- less otherwise provided in this section, every vessel bound for a foreign port or ports will be cleared for a definite port or ports in the order of its itinerary, but an application to clear for a port or

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00059 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

50

19 CFR Ch. I (4–1–12 Edition)§ 4.62

place for orders, that is, for instruc- tions to masters as to destination of the vessel, may be accepted if the ves- sel is in ballast or if any cargo on board is to be discharged in a port of the same country as the port for which clearance is sought.

[T.D. 00–4, 65 FR 2874, Jan. 19, 2000; T.D. 00– 22, 65 FR 16515, Mar. 29, 2000; CBP Dec. 03–32, 68 FR 68169, Dec. 5, 2003]

§ 4.62 Accounting for inward cargo. Inward cargo discrepancies shall be

accounted for and adjusted by correc- tion of the Cargo Declaration Outward With Commercial Forms, Customs Form 1302–A, but the vessel may be cleared and the adjustment deferred if the discharging officer’s report has not been received. (See § 4.12.)

[T.D. 77–255, 42 FR 56322, Oct. 25, 1977, as amended by T.D. 84–193, 49 FR 35485, Sept. 10, 1984]

§ 4.63 Outward cargo declaration; shippers’ export declarations.

(a) No vessel shall be cleared directly for a foreign port, or for a foreign port by way of another domestic port or other domestic ports (see § 4.87(b)), un- less there has been filed with the ap- propriate Customs officer at the port from which clearance is being sought:

(1) A Cargo Declaration Outward With Commercial Forms, Customs Form 1302–A. Copies of bills of lading or equivalent commercial documents relating to all cargo encompassed by the manifest must be attached in such manner as to constitute one document, together with a Vessel Entrance or Clearance Statement, Customs Form 1300, and export declarations as are re- quired by pertinent regulations of the Bureau of the Census, Department of Commerce; or

(2) An incomplete Cargo Declaration as provided for in § 4.75.

(b) Except as hereafter stated, the number of the export declaration cov- ering each shipment for which an au- thenticated export declaration is re- quired shall be shown on the Cargo Declaration Outward With Commercial Forms, Customs Form 1302–A, in the marginal column headed ‘‘B/L No.’’ If an export declaration is not required for a shipment, a notation shall be made on the Cargo Declaration Out-

ward With Commercial Forms (Cus- toms Form 1302–A) describing the basis for the exemption with a reference to the number of the section in the Cen- sus Regulations (see 15 CFR 30.39, 30.50 through 30.57) where the particular ex- emption is provided. If shipments are exempt on the basis of value and des- tination, the appearance of the value and destination on a bill of lading or other commercial documents is accept- able as evidence of the exemption and reference to the applicable section in the Census Regulations is not required.

(c) The following minimal informa- tion shall be included on the Cargo Declaration Outward With Commercial Forms, Customs Form 1302–A (other in- formation required to be on a Customs Form 1302–A as shown on the form itself must also be included thereon) or on attached copies of bills of lading or equivalent commercial documents:

(1) Name and address of shipper; (2) Description of the cargo (see para-

graph (d) of this section); (3) Number of packages and gross

weight (see paragraph (d) of this sec- tion);

(4) Name of vessel or carrier; (5) Port of exit (this shall be the port

where the merchandise is loaded on the vessen( � and

(6) Port of destination (this shall be the foreign port of discharge of the merchandise).

(d) If the bills of lading or equivalent commercial documents attached to the Customs Form 1302–A show on their face the cargo information required by columns 6, 7, and either column 8 or 9, of the Customs Form 1302–A, that in- formation need not be shown again on the Customs Form 1302–A. However, in that case, the cargo information must be incorporated by a suitable reference on the face of the Customs Form 1302– A such as ‘‘Cargo as per attached com- mercial documents.’’

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00060 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

51

U.S. Customs and Border Protection, DHS; Treasury § 4.64

(e) For each shipment to be exported under an entry or withdrawal for ex- portation or for transportation and ex- portation, the Cargo Declaration Out- ward With Commercial Forms, Cus- toms Form 1302–A, or commercial doc- ument attached to the Cargo Declara- tion and made a part thereof in accord- ance with paragraph (a)(1) of this sec- tion, shall clearly show for such ship- ment the number, date, and class of such Customs entry or withdrawal (i.e., T. & E., Wd. T. & E., I. E., Wd. Ex., or Wd. T., as applicable) and the name of the port where the merchandise is laden for exportation.

(f) Customs officers shall accept a Cargo Declaration Outward With Com- mercial Forms, Customs Form 1302–A, covering containerized or palletized cargo which indicates by the use of ap- propriate words of qualification (see § 4.7a(c)(3)) that the declaration has been prepared on the basis of informa- tion furnished by the shipper.

[T.D. 84–193, 49 FR 35484, Sept. 10, 1984; T.D. 00–22, 65 FR 16515, Mar. 29, 2000]

§ 4.64 Electronic passenger and crew member departure manifests.

(a) Definitions. The definitions con- tained in § 4.7b(a) also apply for pur- poses of this section.

(b) Electronic departure manifest—(1) General requirement. Except as provided in paragraph (c) of this section, an ap- propriate official of each commercial vessel departing from the United States to any port or place outside the United States must transmit to Cus- toms and Border Protection (CBP) an electronic passenger departure mani- fest and an electronic crew member de- parture manifest. Each electronic de- parture manifest:

(i) Must be transmitted to CPB at the place and time specified in paragraph (b)(2) of this section by means of an electronic data interchange system ap- proved by CBP. If the transmission is in US EDIFACT format, the passenger manifest and the crew member mani- fest must be transmitted separately; and

(ii) Must set forth the information specified in paragraph (b)(3) of this sec- tion.

(2) Place and time for submission—(i) General requirement. The appropriate of-

ficial must transmit each electronic departure manifest required under paragraph (b)(1) of this section to the CBP Data Center, CBP Headquarters, no later than 60 minutes before the ves- sel departs from the United States.

(ii) Amended crew member manifests. If a crew member boards the vessel after submission of the manifest under para- graph (b)(2)(i) of this section, the ap- propriate official must transmit amended manifest information to CBP reflecting the data required under paragraph (b)(3) of this section for the additional crew member. The amended manifest information must be trans- mitted to the CBP Data Center, CBP Headquarters, no later than 12 hours after the vessel has departed from the United States.

(3) Information required. Each elec- tronic departure manifest required under paragraph (b)(1) of this section must contain the following informa- tion for all passengers and crew mem- bers, except that the information speci- fied in paragraphs (b)(3)(iv), (ix), (xi), (xv), and (xvi), of this section must be included on the manifest only on or after October 4, 2005:

(i) Full name (last, first, and, if available, middle);

(ii) Date of birth; (iii) Gender (F = female; M = male); (iv) Citizenship; (v) Status on board the vessel; (vi) Travel document type (e.g., P =

passport; A = alien registration card); (vii) Passport number, if a passport is

required; (viii) Passport country of issuance, if

a passport is required; (ix) Passport expiration date, if a

passport is required; (x) Alien registration number, where

applicable; (xi) Passenger Name Record locator,

if available; (xii) Departure port code (CBP port

code); (xiii) Port/place of final arrival (for-

eign port code); (xiv) Vessel name; (xv) Vessel country of registry/flag; (xvi) International Maritime Organi-

zation number or other official number of the vessel;

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00061 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

52

19 CFR Ch. I (4–1–12 Edition)§ 4.65

(xvii) Voyage number (applicable only for multiple departures on the same calendar day); and

(xviii) Date of vessel departure. (c) Exceptions. The electronic depar-

ture manifest requirement specified in paragraph (b) of this section is subject to the following conditions:

(1) No passenger or crew member de- parture manifest is required if the de- parting commercial vessel is operating as a ferry;

(2) If the departing commercial vessel is not transporting passengers, only a crew member departure manifest is re- quired;

(3) No passenger departure manifest is required for active duty U.S. mili- tary personnel on board a departing Department of Defense commercial chartered vessel.

(d) Carrier responsibility for comparing information collected with travel docu- ment. The carrier collecting the infor- mation described in paragraph (b)(3) of this section is responsible for com- paring the travel document presented by the passenger or crew member with the travel document information it is transmitting to CBP in accordance with this section in order to ensure that the information is correct, the document appears to be valid for travel purposes, and the passenger or crew member is the person to whom the travel document was issued.

(e) Sharing of manifest information. In- formation contained in passenger and crew member manifests that is re- ceived by CBP electronically may, upon request, be shared with other Federal agencies for the purpose of pro- tecting national security. CBP may also share such information as other- wise authorized by law.

[CBP Dec. 05–12, 70 FR 17851, Apr. 7, 2005, as amended by CBP Dec. 07–64, 72 FR 48342, Aug. 23, 2007]

§ 4.65 Verification of nationality and tonnage.

The nationality and tonnage of a ves- sel shall be verified by examination of its marine document. If such examina- tion discloses that insufficient tonnage tax was collected on entry of the ves- sel, no clearance shall be granted until the deficiency is paid.

§ 4.65a Load lines.

(a) If a port director is notified by an officer of the United States Coast Guard that a detention order has been issued against a vessel engaged in the foreign trade under the International Voyage Load Line Act of 1973, clear- ance shall not be granted until the order is withdrawn.

(b) If a port director issues a deten- tion order under the Coastwise Load Line Act, 1935, as amended, or is noti- fied by an officer of the United States Coast Guard that a detention order has been issued against a vessel under the aforesaid Act, clearance shall not be granted until the order is withdrawn.

[T.D. 75–133, 40 FR 24518, June 9, 1975]

§ 4.66 Verification of inspection.

(a) No clearance shall be granted un- less the port director is satisfied that a proper certificate of inspection is in force and the vessel is in compliance with such certificate, if the vessel is:

(1) A vessel of the United States re- quired to be inspected as specified in Title 46, Code of Federal Regulations.

(2) A foreign vessel carrying pas- sengers from the United States.

(b) In the case of vessels of foreign nations which are signatories of the International Convention for the Safe- ty of Life at Sea, 1948, carrying pas- sengers from the United States, an un- expired Certificate of Examination for Foreign Passenger Vessel, Form CG– 989, or an unexpired Certificate for For- eign Vessel to Carry Persons in Addi- tion to Crew, Form CG–3463, issued by the United States Coast Guard, may be accepted as evidence that a proper cer- tificate of inspection is in force and the vessel is in compliance with such cer- tificate.

(c) In the case of vessels of the United States subject to inspection proceeding to another port for repairs, a valid Permit to Proceed to Another Port for Repairs, Form CG–948, issued by the United States Coast Guard, shall be accepted in lieu of the certifi- cate of inspection required by this sec- tion.

[T.D. 56173, 29 FR 6681, May 22, 1964, as amended by T.D. 69–266, 34 FR 20422, Dec. 31, 1969]

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00062 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

53

U.S. Customs and Border Protection, DHS; Treasury § 4.66c

§ 4.66a Illegal discharge of oil and haz- ardous substances.

If a port director receives a request from an officer of the U.S. Coast Guard to withhold clearance of a vessel whose owner or operator is subject to a civil penalty for discharging oil or a haz- ardous substance into or upon the navi- gable waters of the United States, ad- joining shorelines, or into or upon the waters of the contiguous zone in quan- tities determined to be harmful by ap- propriate authorities, such clearance shall not be granted until the port di- rector is informed that a bond or other surety satisfactory to the Coast Guard has been filed.

[T.D. 82–28, 47 FR 5226, Feb. 4, 1982]

§ 4.66b Pollution of coastal and navi- gable waters.

(a) If any Customs officer has reason to believe that any refuse matter is being or has been deposited in navi- gable waters or any tributary of any navigable waters in violation of section 13 of the Act of March 3, 1899 (30 Stat. 1152; 33 U.S.C. 407), or oil or a haz- ardous substance is being or has been discharged into or upon the navigable waters of the United States, adjoining shorelines, or into or upon the waters of the contiguous zone in violation of the Federal Water Pollution Control Act, as amended (33 U.S.C. 1251, 1321), he shall promptly furnish to the port director a full report of the incident, together with the names of witnesses and, when practicable, a sample of the material discharged from the vessel in question.

(b) The port director shall forward this report immediately, without rec- ommendation, to the district com- mander of the Coast Guard district concerned and a copy of such report shall be furnished to Headquarters, U.S. Customs Service.

[T.D. 73–18, 38 FR 1587, Jan. 16, 1973, as amended by T.D. 82–28, 47 FR 5226, Feb. 4, 1982]

§ 4.66c Oil pollution by oceangoing vessels.

(a) If a port director receives a re- quest from a Coast Guard officer to refuse or revoke the clearance or per- mit to proceed of a vessel because the

vessel, its owner, operator, or person in charge, is liable for a fine or civil pen- alty, or reasonable cause exists to be- lieve that they may be subject to a fine or civil penalty under the provisions of 33 U.S.C. 1908 for violating the Protocol of 1978 Relating to the International Convention for the Prevention of Pol- lution from Ships, 1973 (MARPOL Pro- tocol), the Act to Prevent Pollution from Ships, 1980 (33 U.S.C. 1901–1911), or regulations issued thereunder, such clearance or a permit to proceed shall be refused or revoked. Clearance or a permit to proceed may be granted when the port director is informed that a bond or other security satisfactory to the Coast Guard has been filed.

(b) If a port director receives a notifi- cation from a Coast Guard officer that an order has been issued to detain a vessel required to have an Inter- national Oil Pollution Prevention (IOPP) Certificate which does not have a valid certificate on board, or whose condition or whose equipment’s condi- tion does not substantially agree with the particulars of the certificate on board, or which presents an unreason- able threat of harm to the marine envi- ronment, the port director shall refuse or revoke the clearance or permit to proceed of the vessel if requested to do so by a Coast Guard officer. The port director shall not grant clearance or issue a permit to proceed to the vessel until notified by a Coast Guard officer that detention of the vessel is no longer required.

(c) If a port director receives a notifi- cation from a Coast Guard officer to detain a vessel operated under the au- thority of a country not a party to the MARPOL Protocol which does not have a valid certificate on board showing that the vessel has been surveyed in ac- cordance with and complies with the requirements of the MARPOL Pro- tocol, or whose condition or whose equipment’s condition does not sub- stantially agree with the particulars of the certificate on board, or which pre- sents an unreasonable threat of harm to the marine environment, the port director shall refuse or revoke the clearance or permit to proceed of the vessel if requested to do so by a Coast Guard officer. The port director shall not grant clearance or issue a permit

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00063 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

54

19 CFR Ch. I (4–1–12 Edition)§ 4.67

to proceed to the vessel until notified by a Coast Guard officer that detention of the vessel is no longer required.

[T.D. 81–148, 49 FR 28695, July 16, 1984]

§ 4.67 Closed ports or places. No foreign vessel shall be granted a

clearance or permit to proceed to any port or place from which such vessels are excluded by orders or regulations of the United States Navy Department except with the prior approval of that Department.

§ 4.68 Federal Maritime Commission certificates for certain passenger vessels.

No vessel having berth or stateroom accommodations for 50 or more pas- sengers and embarking passengers at U.S. ports will be granted a clearance at the port or place of departure from the United States unless it is estab- lished that the vessel has valid certifi- cates issued by the Federal Maritime Commission.

[T.D. 00–4, 65 FR 2874, Jan. 19, 2000]

§ 4.69 Shipping articles. No vessel of the U.S. on a voyage be-

tween a U.S. port and a foreign port (except a port in Canada, Mexico, or the West Indies), or if of at least 75 gross tons, on a voyage between a U.S. port on the Atlantic Ocean and a U.S. port on the Pacific Ocean, shall be granted clearance before presentation, to the appropriate Customs officer, of the shipping articles agreements, in- cluding any seaman’s allotment agree- ment, required by 46 U.S.C. chapter 103, in the form provided for in 46 CFR 14.05–1.

[T.D. 92–52, 57 FR 23945, June 5, 1992]

§ 4.70 Public Health Service require- ments.

No clearance will be granted to a ves- sel subject to the foreign quarantine regulations of the Public Health Serv- ice.

[T.D. 00–4, 65 FR 2874, Jan. 19, 2000]

§ 4.71 Inspection of livestock. A proper export inspection certifi-

cate issued by the Veterinary Services, Animal and Plant Health Inspection

Service, Department of Agriculture, shall be filed before the clearance of a vessel carrying horses, mules, asses, cattle, sheep, swine, or goats (9 CFR part 91)

[T.D. 79–32, 44 FR 5650, Jan. 29, 1979]

§ 4.72 Inspection of meat, meat-food products, and inedible fats.

(a) No clearance shall be granted to any vessel carrying meat or meat-food products, as defined and classified by the U.S. Department of Agriculture, Food Safety and Inspection Service, Meat and Poultry Inspection until there have been filed with the port di- rector such copies of export certifi- cates concerning such meat or meat- food products as are required by the pertinent regulations of the U.S. De- partment of Agriculture, Food Safety and Inspection Service, Meat and Poul- try Inspection (9 CFR part 322). If such certificate has been obtained but is un- available at the scheduled time of a vessel’s departure, the vessel may be cleared on the basis of the receipt of a statement, under the shipper’s or ship- per’s agent’s letterhead, certifying the number of boxes, the number of pounds, the product name and the U.S. Department of Agriculture export cer- tificate number that covers the ship- ment of the product. If such statement has been used as the basis for obtaining vessel clearance, the duplicate of the certificate must be filed with Customs within the time period prescribed by § 4.75.

(b) No clearance shall be granted to any vessel carrying tallow, stearin, oleo oil, or other rendered fat derived from cattle, sheep, swine, or goats for export from the United States, which has not been inspected, passed, and marked by the United States Depart- ment of Agriculture, unless the port di- rector is furnished with a certificate by the exporter that the article is ined- ible.

[28 FR 14596, Dec. 31, 1963, as amended by T.D. 78–99, 43 FR 13059, Mar. 29, 1978; T.D. 91– 77, 56 FR 46114, Sept. 10, 1991;T.D. 95–54, 60 FR 35838, July 12, 1995]

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00064 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

55

U.S. Customs and Border Protection, DHS; Treasury § 4.75

104 See 18 U.S.C. 961 through 967 and 22 U.S.C. 441 through 457.

105 Clearance for vessel shall not be denied for the sole reason that her cargo contains contraband of war.

106-110 [Reserved]

§ 4.73 Neutrality; exportation of arms and munitions.

(a) Clearance shall not be granted to any vessel if the port director has rea- son to believe that her departure or in- tended voyage would be in violation of any provision of the Neutrality Act of 1939 or other neutrality law of the United States, 104 or of any regulation or instruction issued pursuant to any such law.

(b) The port director shall refuse clearance for and detain any vessel manifestly built for warlike purposes and about to depart from the United States with a cargo consisting prin- cipally of arms and munitions of war 105 when the number of men intending to sail or other circumstances render it probable that the vessel is intended to commit hostilities against the sub- jects, citizens, or property or any for- eign country, with which the United States is at peace, until the decision of the President thereon is received, or until the owners shall have given bond or security in double the value of the vessel and its cargo that she will not be so employed.

(c) A port director shall promptly communicate all the facts to Head- quarters, U.S. Customs Service, if he learns while the United States is at peace that any vessel of a belligerent power which has arrived as a merchant vessel is altering, or will attempt to alter, her status as a merchant vessel so as to become an armed vessel or an auxiliary to armed vessels of a foreign power.

(d) If a port director has reason to be- lieve during the existence of a war to which the United States is not a party that any vessel at his port is about to carry arms, munitions, supplies, dis- patches, information, or men to any warship or tender or supply ship of a belligerent nation, he shall withhold the clearance of such vessel and report the facts promptly to Headquarters, U.S. Customs Service.

§ 4.74 Transportation orders. Clearance shall not be granted to any

vessel if the port director has reason to believe that her departure or intended voyage would be in violation of any provision of any transportation order, regulation, or restriction issued under authority of the Defense Production Act of 1950 (50 U.S.C. App. 2061–2066).

§ 4.75 Incomplete manifest; incomplete export declarations; bond.

(a) Pro forma manifest. Except as pro- vided for in § 4.75(c), if a master desir- ing to clear his vessel for a foreign port does not have available for filing with the port director a complete Cargo Declaration Outward with Commercial Forms, Customs Form 1302–A (see § 4.63) in accordance with 46 U.S.C. 91, or all required shipper’s export declara- tions (see 15 CFR 30.24), the port direc- tor may accept in lieu thereof an in- complete manifest (referred to as a pro forma manifest) on the Vessel En- trance or Clearance Statement, Cus- toms Form 1300, if there is on file in his office a bond on Customs Form 301, containing the bond conditions set forth in § 113.64 of this chapter relating to international carriers, executed by the vessel owner or other person as at- torney in fact of the vessel owner. The ‘‘Incomplete Manifest for Export’’ box in item 17 of the Vessel Entrance or Clearance Statement form must be checked.

(b) Time in which to file complete mani- fest and export declarations. Not later than the fourth business day after clearance from each port in the vessel’s itinerary, the master, or the vessel’s agent on behalf of the master, shall de- liver to the director of each port a complete Cargo Declaration Outward with Commercial Forms, Customs Form 1302–A, in accordance with § 4.63, of the cargo laden at such port to- gether with duplicate copies of all re- quired shipper’s export declarations for such cargo and a Vessel Entrance or Clearance Statement, Customs Form 1300. The statutory grace period of 4 days for filing the complete manifest and missing export declarations begins to run on the first day (exclusive of any day on which the customhouse is not open for marine business) following the date on which clearance is granted.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00065 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

56

19 CFR Ch. I (4–1–12 Edition)§ 4.76

(c) Countries for which vessels may not be cleared until complete manifests and shipper’s export declarations are filed. To aid the Customs Service in the enforce- ment of export laws and regulations, no vessel shall be cleared for any port in the following countries until a com- plete outward foreign manifest and all required shipper’s export declarations have been filed with the port director:

Albania Bulgaria Cambodia China, People’s

Republic of Cuba Czechoslovakia Estonia German Democratic

Republic (Soviet Zone of Germany and Soviet Zone sector of Berlin)

Hungary Iran Iraq

Laos Latvia Libya Lithuania Mongolian People’s

Republic North Korea Polish People’s

Republic (Including Danzig)

Rumania South Yemen Union of Soviet

Socialist Republics Viet Nam

[T.D. 87–1, 52 FR 255, Jan. 5, 1987, as amended by T.D. 91–60, 56 FR 32085, July 15, 1991; T.D. 00–22, 65 FR 16515, Mar. 29, 2000]

§ 4.76 Procedures and responsibilities of carriers filing outbound vessel manifest information via the AES.

(a) The sea carrier’s module. The Sea Carrier’s Module is a component of the Automated Export System (AES) (see, part 192, subpart B, of this chapter) that allows for the filing of outbound vessel manifest information electroni- cally (see, 15 CFR part 30). All sea car- riers are eligible to apply for participa- tion in the Sea Carrier’s Module. Appli- cation and certification procedures for AES are found at 15 CFR 30.60. A sea carrier certified to use the module that adheres to the procedures set forth in this section and the Census Regula- tions (15 CFR part 30) concerning the electronic submission of an outbound vessel manifest information meets the outward cargo declaration filing re- quirements (CF 1302–A) of §§ 4.63 and 4.75, except as otherwise provided in §§ 4.75 and 4.84.

(b) Responsibilities. The performance requirements and operational stand- ards and procedures for electronic sub- mission of outbound vessel manifest in- formation are detailed in the AES Trade Interface Requirements hand-

book (available on the Customs inter- net web site (www.customs.gov)). Car- riers and their agents are responsible for reporting accurate and timely in- formation and for responding to all no- tifications concerning the status of their transmissions and the detention and release of freight in accordance with the procedures set forth in the AES Trade Interface Requirements handbook. Customs will send messages to participant carriers regarding the accuracy of their transmissions. AES participants are required to comply with the recordkeeping requirements contained at § 30.66 of the Census Regu- lations (15 CFR 30.66) and any other ap- plicable recordkeeping requirements. Where paper SEDs have been submitted by exporters prior to departure, partic- ipant carriers will be responsible for submitting those SEDs to Customs within four (4) business days after the departure of the vessel from each port, unless a different time requirement is specified by §§ 4.75 or 4.84. Upon written agreement with participant sea car- riers, Customs and Census can provide for an alternative to the location filing requirement for paper SEDs set forth in § 4.75(b) by which the participant carriers are otherwise bound.

(c) Messages required to be filed within the sea carrier’s module. Participant car- riers will be responsible for transmit- ting and responding to the following messages:

(1) Booking. Booking information identifies all the freight that is sched- uled for export. Booking information will be transmitted to Customs via AES for each shipment as far in ad- vance of departure as practical, but no later than seventy-two hours prior to departure for all information available at that time. Bookings received within seventy-two hours of departure will be transmitted to Customs via AES as re- ceived;

(2) Receipt of booking. When the car- rier receives the cargo or portion of the cargo that was booked, the carrier will inform Customs so that Customs can determine if an examination of the cargo is necessary. Customs will notify the carrier of shipments designated for examination. Customs will also notify

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00066 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

57

U.S. Customs and Border Protection, DHS; Treasury § 4.80

the carrier when the shipment des- ignated for inspection is released and may be loaded on the vessel;

(3) Departure. No later than the first calendar day following the actual de- parture of the vessel, the carrier will notify Customs of the date and time of departure; and

(4) Manifest. Within ten (10) calendar days after the departure of the vessel from each port, the carrier will submit the manifest information to Customs via AES for each booking loaded on the departed vessel. However, if the des- tination of the vessel is a foreign port listed in § 4.75(c), the carrier must transmit complete manifest informa- tion before vessel departure. Time re- quirements for transmission of com- plete manifest information for carriers destined to Puerto Rico and U.S. pos- sessions are the same as the require- ment for the submission of the com- plete manifest as found in § 4.84.

(d) All penalties and liquidated dam- ages that apply to the submission of paper manifests (see, applicable provi- sions in this part) apply to the elec- tronic submission of outbound vessel manifest information through the Sea Carrier’s Module.

[T.D. 99–57, 64 FR 40986, July 28, 1999]

COASTWISE PROCEDURE

§ 4.80 Vessels entitled to engage in coastwise trade.

(a) No vessel shall transport, either directly or by way of a foreign port, any passenger or merchandise between points in the United States embraced within the coastwise laws, including points within a harbor, or merchandise for any part of the transportation be- tween such points, unless it is:

(1) Owned by a citizen and is so docu- mented under the laws of the United States as to permit it to engage in the coastwise trade;

(2) Owned by a citizen, is exempt from documentation, and is entitled to or, except for its tonnage, would be en- titled to be documented with a coast- wise endorsement.

(3) Owned by a partnership or asso- ciation in which at least a 75 percent interest is owned by such a citizen, is exempt from documentation and is en- titled to or, except for its tonnage, or

citizenship of its owner, or both, would be entitled to be documented for the coastwise trade. The term ‘‘citizen’’ for vessel documentation purposes, wheth- er for an individual, partnership, or corporation owner, is defined in 46 CFR 67.3.

(b) Penalties for violating coastwise laws. (1) The penalty imposed for the il- legal transportation of merchandise be- tween coastwise points is forfeiture of the merchandise or, in the discretion of the port director, forfeiture of a mone- tary amount up to the value of the merchandise to be recovered from the consignor, seller, owner, importer, con- signee, agent, or other person or per- sons so transporting or causing the merchandise to be transported (46 U.S.C. 883).

(2) The penalty imposed for the un- lawful transportation of passengers be- tween coastwise points is $300 for each passenger so transported and landed (46 U.S.C. App. 289, as adjusted by the Fed- eral Civil Penalties Inflation Adjust- ment Act of 1990).

(c) Any vessel of the United States, whether or not entitled under para- graph (a) of this section to engage in the coastwise trade, and any foreign vessel may proceed between points in the United States embraced within the coastwise laws to discharge cargo or passengers laden at a foreign port, to lade cargo or passengers for a foreign port, in ballast, or to transport certain articles in accordance with § 4.93. Cargo laden at a foreign port may be retained onboard during such movements. Fur- thermore, certain barges of United States or foreign flag may transport transferred merchandise between points in the United States embraced within the coastwise laws, excluding transportation between the continental United States and a noncontiguous point in the United States embraced within the coastwise laws, in accord- ance with § 4.81a.

(d) No vessel owned by a corporation which is a citizen of the United States under the Act of September 2, 1958 (46 U.S.C. 12118), shall be used in any trade other than the coastwise and shall not be used in that trade unless it is prop- erly documented for such use or is ex- empt from documentation and is enti- tled to or, except for its tonnage, would

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00067 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

58

19 CFR Ch. I (4–1–12 Edition)§ 4.80

be entitled to a coastwise license. Such a vessel shall not be documented for nor engage in the foreign trade or the fisheries and shall not transport mer- chandise or passengers coastwise for hire except as a service for a parent or a subsidiary corporation as defined in the aforesaid Act or while under de- mise or bareboat charter at prevailing rates for use otherwise than in trade with noncontiguous territory of the United States to a common or contract carrier subject to part III of the Inter- state Commerce Act, as amended (49 U.S.C. 901 through 923), which other- wise qualifies as a citizen of the United States under section 2 of the Shipping Act, 1916, as amended (46 U.S.C. 50501), and which is not connected, directly or indirectly, by way of ownership or con- trol with such owning corporation.

(e) No vessel which has acquired the lawful right to engage in the coastwise trade, by virtue of having been built or documented under the laws of the United States, will have the right to engage in such trade if it:

(1) Thereafter has been sold foreign in whole or in part or placed under for- eign registry, unless such vessel is 200 gross tons or less (as measured under chapter 143 of title 46, United States Code); or

(2) Has been rebuilt, unless the entire rebuilding, including the construction of any major components of the hull or superstructure of the vessel, was ef- fected within the United States.

(f) No foreign-built vessel owned and documented as a vessel of the United States prior to February 1, 1920, by a citizen nor one owned by the United States on June 5, 1920, and sold to and owned by a citizen, shall engage in the American fisheries, but it is otherwise unlimited as to trade so long as it con- tinues in such ownership (section 22, Merchant Marine Act, of June 5, 1920; 46 U.S.C. 13). No foreign-built vessel which is owned by a citizen, but which was not so owned and documented on February 1, 1920, or which was not owned by the United States on June 5, 1920, shall engage in the coastwise trade or the American fisheries. No for- eign-built vessel which has been sold, leased, or chartered by the Secretary of Commerce to any citizen, shall engage in the American fisheries, but it is oth-

erwise unlimited as to trade so long as it continues in such ownership, lease, or charter (section 9 of the Act of Sept. 7, 1916, as amended, 46 U.S.C. 808). A vessel engaged in taking out fishing parties for hire, unless it intends to proceed to a foreign port, is considered to be engaged in the coastwise trade and not the fisheries.

(g) Certain vessels not documented under the laws of the United States which are acquired by or made avail- able to the Secretary of Commerce may be documented under section 3 of the Act of August 9, 1954 (50 U.S.C. 198). Such vessels shall not engage in the coastwise trade unless in possession of a valid unexpired permit to engage in that trade issued by the Secretary of Commerce under authority of section 3(c) of the said Act.

(h) A vessel which is at least 50 per- cent owned by a citizen as defined in 46 CFR subpart 68.05, and which, except for citizenship requirements, is other- wise entitled to be documented with a coastwise endorsement, may be docu- mented with a limited coastwise en- dorsement, provided the vessel is owned by a not-for-profit oil spill re- sponse cooperative or by one or more members of such a cooperative who dedicate the vessel to the use of the co- operative (46 U.S.C. 12106(d)). Notwith- standing 46 U.S.C. App. 883, a vessel may be documented with such a lim- ited endorsement even if formerly owned by a not-for-profit oil spill re- sponse cooperative or by one or more members thereof, as long as the citi- zenship criteria of 46 CFR subpart 68.05 are met. A vessel so documented may operate on the navigable waters of the United States or in the Exclusive Eco- nomic Zone only for the purpose of training for oil spill cleanup oper- ations; deploying equipment, supplies and personnel for cleanup operations; and recovering and/or transporting oil discharged in a spill. Such vessel may also engage in any other employment for which a registry, fishery, or Great Lakes endorsement is not required, and may qualify to operate for other pur- poses by meeting the applicable re- quirements of 46 CFR part 67.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00068 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

59

U.S. Customs and Border Protection, DHS; Treasury § 4.80b

(i) Any vessel, entitled to be docu- mented and not so documented, em- ployed in a trade for which a Certifi- cate of Documentation is issued under the vessel documentation laws (see § 4.0(c)), other than a trade covered by a registry, is liable to a civil penalty of $500 for each port at which it arrives without the proper Certificate of Docu- mentation. If such a vessel has on board any foreign merchandise (sea stores excepted), or any domestic tax- able alcoholic beverages, on which the duty and taxes have not been paid or secured to be paid, the vessel and its cargo are subject to seizure and for- feiture.

[T.D. 69–266, 34 FR 20422, Dec. 31, 1969, as amended by T.D. 79–160, 44 FR 31956, June 4, 1979; T.D. 83–214, 48 FR 46512, Oct. 13, 1983; T.D. 93–78, 58 FR 50257, Sept. 27, 1993; T.D. 97– 82, 62 FR 51769, Oct. 3, 1997; T.D. 03–11, 68 FR 13820, Mar. 21, 2003; CBP Dec. 08-25, 73 FR 40725, July 16, 2008]

§ 4.80a Coastwise transportation of passengers.

(a) For the purposes of this section, the following terms will have the meaning set forth below:

(1) Coastwise port means a port in the U.S., its territories, or possessions em- braced within the coastwise laws.

(2) Nearby foreign port means any for- eign port in North America, Central America, the Bermuda Islands, or the West Indies (including the Bahama Is- lands, but not including the Leeward Islands of the Netherlands Antilles, i.e., Aruba, Bonaire, and Curacao). A port in the U.S. Virgin Islands shall be treated as a nearby foreign port.

(3) Distant foreign port means any for- eign port that is not a nearby port.

(4) Embark means a passenger board- ing a vessel for the duration of a spe- cific voyage and disembark means a pas- senger leaving a vessel at the conclu- sion of a specific voyage. The terms em- bark and disembark are not applicable to a passenger going ashore tempo- rarily at a coastwise port who reboards the vessel and departs with it on sail- ing from the port.

(5) Passenger has the meaning defined in § 4.50(b).

(b) The applicability of the coastwise law (46 U.S.C. 289) to a vessel not quali- fied to engage in the coastwise trade

(i.e., either a foreign-flag vessel or a U.S.-flag vessel that is foreign-built or at one time has been under foreign- flag) which embarks a passenger at a coastwise port is as follows:

(1) If the passenger is on a voyage solely to one or more coastwise ports and the passenger disembarks or goes ashore temporarily at a coastwise port, there is a violation of the coastwise law.

(2) If the passenger is on a voyage to one or more coastwise ports and a nearby foreign port or ports (but at no other foreign port) and the passenger disembarks at a coastwise port other than the port of embarkation, there is a violation of the coastwise law.

(3) If the passenger is on a voyage to one or more coastwise ports and a dis- tant foreign port or ports (whether or not the voyage includes a nearby for- eign port or ports) and the passenger disembarks at a coastwise port, there is no violation of the coastwise law provided the passenger has proceeded with the vessel to a distant foreign port.

(c) An exception to the prohibition in this section is the transportation of passengers between ports in Puerto Rico and other ports in the U.S. on pas- senger vessels not qualified to engage in the coastwise trade. Such transpor- tation is permitted until there is a finding under 46 U.S.C. 289c that a qualified U.S.-flag passenger vessel is available for such service.

(d) The owner or charterer of a for- eign vessel or any other interested per- son may request from Headquarters, U.S. Customs and Border Protection, Attention: Cargo Security, Carriers & Immigration Branch, Office of Inter- national Trade, an advisory ruling as to whether a contemplated voyage would be considered to be coastwise transportation in violation of 46 U.S.C. 289. Such a request shall be filed in ac- cordance with the provisions of part 177, CBP Regulations (19 CFR part 177).

[T.D. 85–109, 50 FR 26984, July 1, 1985, as amended by T.D. 85–109, 50 FR 37519, Sept. 16, 1985; T.D. 99–27, 64 FR 13675, Mar. 22, 1999]

§ 4.80b Coastwise transportation of merchandise.

(a) Effect of manufacturing or proc- essing at intermediate port or place. A

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00069 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

60

19 CFR Ch. I (4–1–12 Edition)§ 4.81

111 See § 4.84. 112-114 [Reserved]

coastwise transportation of merchan- dise takes place, within the meaning of the coastwise laws, when merchandise laden at a point embraced within the coastwise laws (‘‘coastwise point’’) is unladen at another coastwise point, re- gardless of the origin or ultimate des- tination of the merchandise. However, merchandise is not transported coast- wise if at an intermediate port or place other than a coastwise point (that is at a foreign port or place, or at a port or place in a territory or possession of the United States not subject to the coast- wise laws), it is manufactured or proc- essed into a new and different product, and the new and different product thereafter is transported to a coastwise point.

(b) Request for ruling. Interested par- ties may request an advisory ruling from Headquarters, U.S. Customs and Border Protection, Attention: Cargo Security, Carriers & Immigration Branch, Office of International Trade, as to whether a specific action taken or to be taken with respect to merchan- dise at the intermediate port or place will result in its becoming a new and different product for purposes of this section. The request shall be filed in accordance with the provisions of part 177 of this chapter.

[T.D. 79–193, 44 FR 42178, July 19, 1979, as amended by T.D. 91–77, 56 FR 46114, Sept. 10, 1991; 56 FR 47268, Sept. 18, 1991; T.D. 99–27, 64 FR 13675, Mar. 22, 1999]

§ 4.81 Reports of arrivals and depar- tures in coastwise trade.

(a) No vessel which is documented with a coastwise license or registry en- dorsement or is owned by a citizen and exempt from documentation, and which is in ballast or laden only with domestic products or passengers being carried only between points in the United States shall be required to re- port arrival or to enter when coming into one port of the United States from any other such port, except as provided for in sections 4.83 and 4.84, nor to ob- tain a clearance, permit to proceed, or permission to depart when going from one port in the United States to any other such port except when trans-

porting merchandise to a port in noncontinguous territory. 111

(b) When the facts are as above stat- ed except that the vessel is carrying bonded merchandise, the master shall report its arrival as provided for in § 4.2.

(c) [Reserved] (d) The traveling Crew’s Effects Dec-

laration, Customs Form 1304, or Cus- toms and Immigration Form I–418 with attached Customs Form 5129, referred to in § 4.85 (b), (c), and (e) shall be de- posited with the port director upon ar- rival at each port in the United States and finally surrendered to the appro- priate Customs officer or director of the port where the vessel first departs directly for a foreign port.

(e) Before any foreign vessel departs in ballast, or solely with articles to be transported in accordance with § 4.93, from any port in the United States for any other such port, the master must apply to the port director for a permit to proceed by filing a Vessel Entrance or Clearance Statement, Customs Form 1300, in duplicate. If a vessel is proceeding in ballast and therefore the Cargo Declaration (Customs Form 1302) is omitted, the words ‘‘No merchandise on board’’ shall be inserted in item 16 of the Vessel Entrance or Clearance Statement. However, articles to be transported in accordance with § 4.93 must be manifested on the Cargo Dec- laration, as required by § 4.93(c). Three copies of the Cargo Declaration must be filed with the port director. When the port director grants the permit by making an appropriate endorsement on the Vessel Entrance or Clearance Statement (see § 4.85(b)), the duplicate copy, together with two copies of the Cargo Declaration covering articles to be transported in accordance with § 4.93, must be returned to the master. The traveling Crew’s Effects Declara- tion, Customs Form 1304, and all un- used crewmembers’ declarations on Customs Form 5129 will be placed in a sealed envelope addressed to the appro- priate Customs officer at the next in- tended domestic port and returned to the master for delivery. The master must execute a receipt for all unused

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00070 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

61

U.S. Customs and Border Protection, DHS; Treasury § 4.81

crewmembers’ declarations which are returned to him. Immediately upon ar- rival at the next United States port the master must report his arrival to the port director. He must make entry within 48 hours by filing with the port director the permit to proceed on the Vessel Entrance or Clearance State- ment received at the previous port, a newly executed Vessel Entrance or Clearance Statement, a Crew’s Effects Declaration of all unentered articles acquired abroad by crewmembers which are still on board, a Ship’s Stores Declaration, Customs Form 1303, in duplicate of the stores remain- ing on board, both copies of the Cargo Declaration covering articles trans- ported in accordance with § 4.93, and the document of the vessel. The trav- eling Crew’s Effects Declaration and all unused crewmembers’ declarations on Customs Form 5129 returned at the prior port to the master must be deliv- ered by him to the appropriate Cus- toms officer.

(f) The master, licensed deck officer, or purser who enters or clears a vessel, or who obtains permission for a vessel to depart, when required under the pro- visions of this section or of §§ 4.82, 4.84, 4.85, 4.87, 4.89, or 4.91 of the regulations of this part, may appear in person at the customhouse for that purpose, or any required oaths, related documents, and other papers properly executed by the master or other proper officer may be delivered at the customhouse by the vessel agent or other personal rep- resentative of the master.

(g) In lieu of the procedures stated in §§ 4.85 and 4.87 and at the option of the owner or operator, unmanned non-self- propelled barges specifically designed for carriage aboard a vessel and regu- larly carried aboard a vessel in the for- eign trade, hereinafter referred to as LASH-type barges, may move under a simplified permit-to-proceed procedure as follows:

(1) At the port where a LASH-type barge begins a coastwise movement with inward foreign cargo, a permit to proceed on the Vessel Entrance or Clearance Statement, Customs Form 1300, must be obtained. A single permit to proceed may be used for all the barges proceeding to the same port of unlading in the same town. An inward

foreign manifest of the cargo in each barge, destined to the port of unlading shown on the permit to proceed, must be attached to each permit. At the port of unlading of the barge, report of ar- rival and entry must be made imme- diately upon arrival to the appropriate Customs officer by presentation of the permit to proceed, manifests, and a new Vessel Entrance or Clearance Statement, Customs Form 1300. If only part of the inward foreign cargo is un- laden, a new permit to proceed must be obtained and the inward foreign mani- fests must be attached to it.

(2) At the port where a LASH-type barge begins a coastwise movement with export cargo, a permit to proceed on the Vessel Entrance or Clearance Statement, Customs Form 1300, must be presented to the appropriate Cus- toms officer. A single permit to pro- ceed may be presented for all the barges proceeding from the same port of lading in the same tow. Required shipper’s export declarations for LASH-type barges must be filed at the port where the barges will be taken aboard a barge-carrying vessel. At the next port, a report of arrival must be made immediately upon arrival and entry must be made within 48 hours by presentation of the permit to proceed received upon departure from the prior port and a newly executed Vessel En- trance or Clearance Statement, Cus- toms Form 1300.

(3) When foreign LASH-type barges are proceeding between ports of the United States under paragraph (e) of this section, a single permit to proceed may be used for all the barges pro- ceeding to the same port in the same tow.

(4) In lieu of the master of the towing vessel executing and delivering docu- ments required under permit-to-pro- ceed procedures (see § 4.81(f)) at the port where a LASH-type barge begins a coastwise movement, the master of the towing vessel may designate in writing the owner or operator of the barges as his representative with authority to execute and deliver such documents at the customhouse. The owner or oper- ator of the barges may designate rep- resentatives to perform such functions at ports or places where permit-to-pro- ceed documents must be delivered.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00071 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

62

19 CFR Ch. I (4–1–12 Edition)§ 4.81a

Documents obtained from Customs of- ficers at one place by such a represent- ative may be forwarded by any suitable means to the representative who must present them to Customs officers at an- other place, the only requirement being that the forms are properly com- pleted and are presented within the prescribed time periods. Moreover, in- stead of a written designation from each master of a towing vessel, a blan- ket designation in writing from the owner or operator of one or more tow- ing vessels on behalf of masters of their towing vessels, designating the owner or operator of the barges to be the rep- resentative of the master for purposes of executing and delivering permit-to- proceed documents, is authorized.

(5) [Reserved] (6) When a LASH-type barge is pro-

ceeding to a place in the United States that is not a port of entry, § 101.4(a) and (b) of this chapter are applicable. No merchandise shall be unladen from a LASH-type barge until a permit or spe- cial license therefor is obtained in ac- cordance with § 4.30 except that a single permit to unlade may be used for all barges that arrived at the port of un- lading in the same tow.

[28 FR 14596, Dec. 31, 1963, as amended by T.D. 71–169, 36 FR 12604, July 2, 1971; T.D. 74– 63, 39 FR 6108, Feb. 19, 1974; T.D. 74–284, 39 FR 39718, Nov. 11, 1974; T.D. 75–315, 40 FR 58852, Dec. 19, 1975; T.D. 77–241, 42 FR 54936, Oct. 12, 1977; T.D. 77–255, 42 FR 56322, Oct. 25, 1977; T.D. 83–214, 48 FR 46512, Oct. 13, 1983; T.D. 92– 74, 57 FR 35752, Aug. 11, 1992; T.D. 93–96, 58 FR 67317, Dec. 21, 1993; T.D. 00–22, 65 FR 16515, Mar. 29, 2000]

§ 4.81a Certain barges carrying mer- chandise transferred from another barge.

(a) A LASH-type barge (as defined in § 4.81(g)) documented as a vessel of the United States but not qualified to en- gage in the coastwise trade or a LASH- type barge of a nation found to grant reciprocal privileges to United States- flag LASH-type barges may transport inward foreign and export cargo be- tween points embraced within the coastwise laws of the United States after the merchandise has been trans- ferred to it from another LASH-type barge owned or leased by the same owner or operator. This section is not applicable to transportation between

the continental United States and non- contiguous States, districts, terri- tories, and possessions embraced with- in the coastwise laws. The permit to proceed shall include a statement that the unqualified LASH-type barge is owned or leased by the owner or oper- ator of the LASH-type barge from which the merchandise was trans- ferred.

(b) The following nations have been found to extend privileges reciprocal to those provided in paragraph (a) of this section to LASH-type barges of the United States:

Federal Republic of Germany. Netherlands. Sweden. Union of Soviet Socialist Republics.

[T.D. 74–63, 39 FR 6108, Feb. 19, 1974, as amended by T.D. 74–292, 39 FR 41360, Nov. 27, 1974; T.D. 75–7, 39 FR 44660, Dec. 26, 1974; T.D. 75–315, 40 FR 58852, Dec. 19, 1975; T.D. 78–492, 43 FR 58814, Dec. 18, 1978]

§ 4.82 Touching at foreign port while in coastwise trade.

(a) A United States documented ves- sel with a registry or, coastwise en- dorsement, or both which, during a voyage between ports in the United States, touches at one or more foreign ports and there discharges or takes on merchandise, passengers, baggages, or mail shall obtain a permit to proceed or clearance at each port of lading in the United States for the foreign port or ports at which it is intended to touch. The Cargo Declaration Outward With Commercial Forms, Customs Form 1302–A (see § 4.63), shall show only the cargo for foreign destination. (See §§ 4.61 and 4.87.)

(b) The master shall also present to the port director a coastwise Cargo Declaration in triplicate of the mer- chandise to be transported via the for- eign port or ports to the subsequent ports in the United States. It shall de- scribe the merchandise and show the marks and numbers of the packages, the names of the shippers and con- signees, and the destinations. The port director shall certify the two copies and return them to the master. Mer- chandise carried by the vessel in bond under a transportation entry and mani- fest, Customs Form 7512, shall not be

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00072 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

63

U.S. Customs and Border Protection, DHS; Treasury § 4.84

shown on the coastwise Cargo Declara- tion.

(c) Upon arrival from the foreign port or ports at the subsequent port in the United States, a report of arrival and entry of the vessel shall be made, and tonnage taxes shall be paid. The mas- ter shall present Cargo Declaration in accordance with § 4.7 and the certified copies of the coastwise Cargo Declara- tion, Customs Form 1302.

(d) All merchandise on the vessel upon its arrival at the subsequent port in the United States is subject to such Customs examination and treatment as may be necessary to protect the rev- enue. Any article on board which is not identified to the satisfaction of the port director, by the coastwise Cargo Declaration, Customs Form 1302, or otherwise, as part of the coastwise cargo, shall be treated as imported merchandise.

[T.D. 77–255, 42 FR 56322, Oct. 25, 1977, as amended by T.D. 83–214, 48 FR 46513, Oct. 13, 1983; T.D. 84–193, 49 FR 35485, Sept. 10, 1984; T.D. 99–64, 64 FR 43265, Aug. 10, 1999; CBP Dec. 08-25, 73 FR 40725, July 16, 2008]

§ 4.83 Trade between United States ports on the Great Lakes and other ports of the United States.

(a) If a vessel proceeding from or to a port of the United States on the Great Lakes to or from any other port of the United States via the St. Lawrence River is intended to touch at any for- eign port and does so touch, it will be subject to the usual requirements for manifesting, clearing, report of arrival, entry, payment of fees for entry and clearance, and tonnage taxes. Vessels which are boarded on the St. Lawrence River by Canadian authorities for the purposes of inspecting the vessel and taking a passing report are not deemed to have touched at a foreign port, pro- vided that no ship’s stores are landed or taken aboard and no other business is transacted at the port or place of boarding.

(b) A vessel in the coastwise trade only, which is proceeding from a port of the United States on the Great Lakes via the Hudson River and other- wise than by sea, may operate under a document with a Great Lakes license endorsement and shall not be subject

to the requirements for clearance, re- port of arrival, or entry.

[28 FR 14596, Dec. 31, 1963, as amended by T.D. 69–266, 34 FR 20423, Dec. 31, 1969; T.D. 83– 214, 48 FR 46513, Oct. 13, 1983]

§ 4.84 Trade with noncontiguous terri- tory.

(a) No foreign vessel shall depart from a port in noncontiguous territory of the United States for any other port in noncontiguous territory or for any port in any State or the District of Co- lumbia, nor from any port in any State or the District of Columbia for any port in noncontiguous territory, until a clearance for the vessel has been granted. Such a clearance shall be granted in accordance with the applica- ble provisions of § 4.61 of the regula- tions of this part, including clearance of a vessel simultaneously engaged in one or more of the transactions listed in § 4.90(a)(4), (5), or (6) of this part. When merchandise is laden on a foreign vessel in noncontiguous territory other than Puerto Rico, for transportation on that vessel to a port in any State, the District of Columbia, or noncontig- uous territory, and when this transpor- tation is not forbidden by the coast- wise laws, the merchandise may be laden and shipped without shipper’s ex- port declarations.

(b) The master of every foreign vessel arriving at a port in any State or the District of Columbia or in noncontig- uous territory of the United States from a port in noncontiguous territory to which the coastwise laws do not apply (e.g., Virgin Islands and Amer- ican Samoa), or arriving at any port in noncontiguous territory to which the coastwise laws do not apply from any place embraced within the coastwise laws, shall immediately report its ar- rival and make entry for the vessel within 48 hours after its arrival.

(c)(1) A vessel which is not required to clear but which is transporting mer- chandise from a port in any State or the District of Columbia to any non- contiguous territory of the United States (excluding Puerto Rico), or from

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00073 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

64

19 CFR Ch. I (4–1–12 Edition)§ 4.85

Puerto Rico to any State or the Dis- trict of Columbia, or any other non- contiguous territory, shall not be per- mitted to depart without filing a com- plete manifest, when required by regu- lations of the Bureau of the Census (15 CFR part 30), and all required Shipper’s Export Declarations, unless before the vessel departs an approved bond is filed for the timely production of the re- quired documents, as specified in 15 CFR 30.24. Requests for permission to depart may be written or oral and per- mission to depart shall be granted oral- ly by the appropriate Customs officer. However, if the request is to depart prior to the filing of the required mani- fest and export declarations, permis- sion shall not be granted unless the ap- propriate bond is on file. In the latter case, the Customs officer shall keep a simplified record of the necessary in- formation in order to assure that the manifest and export declarations are filed within the required time period. The Vessel Entrance or Clearance Statement, Customs Form 1300 (see § 4.63(a)), required at the time of clear- ance is not required to be taken to ob- tain permission to depart.

(2) A vessel which is not required to clear but which is transporting mer- chandise from a port in any State or the District of Columbia to Puerto Rico shall file a complete manifest, when required by the regulations of the Bureau of the Census (15 CFR part 30), and all required Shipper’s Export Dec- larations within one business day after arrival, as defined in § 4.2(b) of this part, with the appropriate Customs of- ficer in Puerto Rico. If the complete manifest and all required Shipper’s Ex- port Declarations are not filed with the appropriate Customs officer within that time frame, an appropriate bond shall be filed with the Customs officer for the timely production of the re- quired documents as specified in 15 CFR 30.24. In these instances when a bond is filed, the Customs officer shall keep a simplified record of the nec- essary information in order to ensure that the manifest and export declara- tions are filed not later than the sev- enth business day after arrival in Puer- to Rico.

(d) Upon arrival of a vessel of the United States at a port in any State,

the District of Columbia, or Puerto Rico from a port in noncontiguous ter- ritory other than Puerto Rico, the master shall immediately report its ar- rival and shall prepare, produce, and file a Cargo Declaration in the form and manner and at the times specified in §§ 4.7 and 4.9 but shall not be re- quired to make entry. If the vessel pro- ceeds directly to another port in any State, the District of Columbia, or Puerto Rico, the master shall prepare, produce, and file a Cargo Declaration in the form and manner and at the times specified in § 4.85 but no permit to proceed on the Vessel Entrance or Clearance Statement, Customs Form 1300, shall be required for the purposes of this paragraph. No cargo shall be un- laden from any such vessel until Cargo Declarations have been filed and a per- mit to unlade has been issued in ac- cordance with the procedure specified in § 4.30.

(e) No vessel shall bring guano to the United States from a guano island ap- pertaining to the United States (see 48 U.S.C. 1411) unless such a vessel is enti- tled to engage in the coastwide trade.

(f) No vessel owned by a corporation which qualifies as a citizen under the Act of September 2, 1958 (46 U.S.C. 883– 1) shall, while under demise or bareboat charter from such corpora- tion, be granted clearance or permitted to depart in trade with noncontiguous territory.

[28 FR 14596, Dec. 31, 1963, as amended by T.D. 69–266, 34 FR 20423, Dec. 31, 1969: T.D. 71– 169, 36 FR 12604, July 2, 1971; T.D. 77–255, 42 FR 56323, Oct. 25, 1977; T.D. 79–276, 44 FR 61956, Oct. 29, 1979; T.D. 93–61, 58 FR 41425, Aug. 4, 1993; T.D. 93–96, 58 FR 67317, Dec. 21, 1993; T.D. 00–22, 65 FR 16516, Mar. 29, 2000]

§ 4.85 Vessels with residue cargo for domestic ports.

(a) Any foreign vessel or documented vessel with a registry or, where appro- priate, a Great Lakes license endorse- ment, arriving from a foreign port with cargo or passengers manifested for ports in the United States other than the port of first arrival, may proceed with such cargo or passengers from port to port, provided a bond on Cus- toms Form 301, containing the bond conditions set forth in § 113.64 of this

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00074 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

65

U.S. Customs and Border Protection, DHS; Treasury § 4.85

115 ‘‘* * * Any vessel arriving from a foreign port or place having on board merchandise shown by the manifest to be destined to a port or ports in the United States other than the port of entry at which such vessel first arrived and made entry may proceed with such merchandise from port to lading there- of.’’ (Tariff Act of 1930, sec. 442; 19 U.S.C. 1442)

116-118 [Reserved]

chapter relating to international car- riers in a suitable amount is on file with the director of the port of first entry. 115 No additional bond shall be required at subsequent ports of entry. Before the vessel departs from the port of first arrival, the master shall obtain from the port director a certified copy of the complete inward foreign mani- fest (hereinafter referred to as the traveling manifest). The certified copy shall have a legend similar to the fol- lowing endorsed on the Vessel En- trance or Clearance Statement, Cus- toms Form 1300:

llllllllllllllllllllllll

Port Date Certified to be a true copy of the original

inward foreign manifest.

———————————— Signature and title

(b)(1) Before a vessel proceeds from one domestic port to another with cargo or passengers on board as de- scribed in paragraph (a) of this section, the master must present to the direc- tor of such port of departure an appli- cation in triplicate on Customs Form 1300 for a permit to proceed to the next port. When a port director grants the permit on Customs Form 1300, the fol- lowing legend must be endorsed on the form:

Port Date Permission is granted to proceed to the

port named in item 12. llll

Signature and title

(2) The duplicate must be attached to the traveling manifest and the trip- licate (the permit to proceed to be de- livered at the next port) must be re- turned to the master, together with the traveling manifest and the vessel’s document, if on deposit. If no inward foreign cargo or passengers are to be discharged at the next port, that fact

must be indicated on Customs Form 1300 by inserting ‘‘To load only’’ in pa- rentheses after the name of the port to which the vessel is to proceed. The traveling Crew’s Effects Declaration covering articles acquired abroad by officers and members of the crew, to- gether with the unused crewmembers’ declarations prepared for such articles, will be placed in a sealed envelope ad- dressed to the appropriate Customs of- ficer at the next port and given to the master for delivery.

(c)(1) Upon the arrival of a vessel at the next and each succeeding domestic port with inward foreign cargo or pas- sengers still on board, the master must immediately report its arrival and make entry within 48 hours. To make such entry, he must deliver to the port director the vessel’s document, the per- mit to proceed (Customs Form 1300 en- dorsed in accordance with paragraph (b) of this section), the traveling mani- fest, and the traveling Crew’s Effects Declaration (Customs Form 1304), to- gether with the crewmembers’ declara- tions received on departure from the previous port. The master must also present an abstract manifest consisting of a newly executed Vessel Entrance or Clearance Statement, Customs Form 1300, a Cargo Declaration, Customs Form 1302, and a Passenger List, Cus- toms and Immigration Form I–418, in such number of copies as may be re- quired for local Customs purposes, of any cargo or passengers on board mani- fested for discharge at that port, a Crew’s Effects Declaration in duplicate of all unentered articles acquired abroad by officers and crewmembers which are still on board, a Ship’s Stores Declaration, Customs Form 1303, in duplicate of the sea or ship’s stores remaining on board, and if appli- cable, the Cargo Declaration required by § 4.86. If no inward foreign cargo or passengers are to be discharged, the Cargo Declaration or Passenger List may be omitted from the abstract manifest, and the following legend must be placed in item 15 of the Vessel Entrance or Clearance Statement:

Vessel on an inward foreign voyage with residue cargo/passengers for llll. No cargo or passengers for discharge at this port.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00075 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

66

19 CFR Ch. I (4–1–12 Edition)§ 4.86

(2) The traveling manifest, together with a copy of the newly executed Ves- sel Entrance or Clearance Statement, will serve the purpose of a copy of an abstract manifest at the port where it is finally surrendered.

(d) If boarding is required before the port director will issue a permit or spe- cial license to lade or unlade, the ab- stract manifest described in paragraph (c) of this section shall be ready for presentation to the boarding officer.

(e) The traveling manifest shall be surrendered to the director of the final domestic port of discharge of the cargo, except that if residue foreign cargo re- mains on board for discharge at a for- eign port or ports, the traveling mani- fest shall be surrendered at the final port of departure from the United States. However, it shall not be surren- dered at the port from which the vessel departs for another United States port, via an intermediate foreign port, under § 4.89 if residue foreign cargo remains on board for discharge at a subsequent U.S. port. The traveling Crew’s Effects Declaration shall be finally surren- dered to the director of any port from which the vessel will depart directly for a foreign port.

[T.D. 71–169, 36 FR 12604, July 2, 1971, as amended by T.D. 77–255, 42 FR 56323, Oct. 25, 1977; T.D. 83–214, 48 FR 46513, Oct. 13, 1983; T.D. 84–213, 49 FR 41164, Oct. 19, 1984; T.D. 92– 74, 57 FR 35752, Aug. 11, 1992; T.D. 93–96, 58 FR 67317, Dec. 21, 1993; T.D. 94–24, 59 FR 13200, Mar. 21, 1994; T.D. 00–22, 65 FR 16516, Mar. 29, 2000]

§ 4.86 Intercoastal residue—cargo pro- cedure; optional ports.

(a) When a vessel arrives at an Atlan- tic or Pacific coast port from a foreign port or ports with residue cargo for de- livery at a port or ports on the oppo- site coast or on the Great Lakes, or where such arrival is at a port on the Great Lakes, with residue cargo for de- livery at a port or ports on the Atlan- tic or Pacific coasts, or both, and the master, owner, or agent is unable at that time to designate the specific port or ports of discharge of that residue cargo, the Cargo Declaration, Customs Form 1302, filed on entry in accordance with § 4.7(b) shall show such cargo as destined for ‘‘optional ports, Atlantic coast,’’ or ‘‘optional ports, Pacific coast,’’ or ‘‘optional ports, Great Lakes

coast,’’ as the case may be. The trav- eling manifest shall be similarly noted. Upon arrival of the vessel at the first port on the next coast, the master, owner, or agent must designate the port or ports of discharge of residue cargo as required by section 431, Tariff Act of 1930.

(b) For this purpose, the master shall furnish with the other papers required upon entry a Cargo Declaration, Cus- toms Form 1302 in original only of in- ward foreign cargo remaining on board for discharge at optional ports on that coast, and the Cargo Declaration, must designate the specific ports of intended discharge for that cargo. The traveling manifest shall be amended to agree with that Cargo Declaration so as to show the newly designated ports of dis- charge on that coast and shall be used to verify the abstract Cargo Declara- tions surrendered at subsequent ports on that coast.

[T.D. 77–255, 42 FR 56323, Oct 25, 1977]

§ 4.87 Vessels proceeding foreign via domestic ports.

(a) Any foreign vessel or documented vessel with a registry may proceed from port to port in the United States to lade cargo or passengers for foreign ports.

(b) When applying for a clearance from the first and each succeeding port of lading, the master must present to the port director a Vessel Entrance or Clearance Statement, Customs Form 1300, in duplicate and a Cargo Declara- tion Outward With Commercial Forms, Customs Form 1302–A, in accordance with § 4.63(a), of all the cargo laden for export at that port. The Vessel En- trance or Clearance Statement must clearly indicate all previous ports of lading.

(c) Upon compliance with the appli- cable provisions of § 4.61, the port direc- tor will grant the permit to proceed by making the endorsement prescribed by § 4.85(b) on the Vessel Entrance or Clearance Statement, Customs Form 1300. One copy will be returned to the master, together with the vessel’s doc- ument if on deposit. The traveling Crew’s Effects Declaration, Customs Form 1304, together with any unused crewmembers’ declarations, will be placed in a sealed envelope addressed

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00076 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

67

U.S. Customs and Border Protection, DHS; Treasury § 4.88

119 ‘‘Any vessel having on board merchan- dise shown by the manifest to be destined to a foreign port or place may, after the report and entry of such vessel under the provisions of this Act, proceed to such foreign port of destination with the cargo so destined there- for, without unlading the same and without the payment of duty thereon. * * *’’ (Tariff Act of 1930, sec. 442; 19 U.S.C. 1442)

120 ‘‘The Secretary of the Treasury may by regulations require the production of landing certificates in respect of merchandise ex- ported from the United States, or in respect of residue cargo, in cases in which he deems it necessary for the protection of the rev- enue.’’ (Tariff Act of 1930, sec. 622; 19 U.S.C. 1622)

to the appropriate Customs officer at the next domestic port and returned to the master.

(d) On arrival at the next and each succeeding domestic port, the master must immediately report arrival. He must also make entry within 48 hours by presenting the vessel’s document, the permit to proceed on the Vessel En- trance or Clearance Statement, Cus- toms Form 1300, received by him upon departure from the last port, a Crew’s Effects Declaration, Customs Form 1304, in duplicate listing all unentered articles acquired aboard by officers and crew of the vessel which are still re- tained on board, and a Ship’s Stores Declaration, Customs Form 1303, in du- plicate of the stores remaining aboard. The master must also execute a Vessel Entrance or Clearance Statement. The traveling Crew’s Effects Declaration, together with any unused crew- members’ declarations returned to the master at the prior port, will be deliv- ered by him to the port director.

(e) Clearance shall be granted at the final port of departure from the United States in accordance with § 4.61.

(f) If a complete Cargo Declaration Outward With Commercial Forms, Cus- toms Form 1302–A (see § 4.63), and all required shipper’s export declarations are not available for filing before de- parture of a vessel from any port, clearance on the Vessel Entrance or Clearance Statement, Customs Form 1300, may be granted in accordance with § 4.75, subject to the limitation specified in § 4.75(c).

(g) When the procedure outlined in paragraph (f) of this section is followed at any port, the owner or agent of the vessel must deliver to the director of that port within 4 business days after the vessel’s clearance a Cargo Declara- tion Outward With Commercial Forms, Customs Form 1302–A (see § 4.63), and the export declarations to cover the cargo laden for export at that port.

[T.D. 77–255, 42 FR 56324, Oct. 25 1977, as amended by T.D. 83–214, 48 FR 46513, Oct. 13, 1983; T.D. 84–193, 49 FR 35485, Sept. 10, 1984; T.D. 92–74, 57 FR 35752, Aug. 11, 1992; T.D. 93– 96, 58 FR 67317, Dec. 21, 1993; T.D. 00–22, 65 FR 16517, Mar. 29, 2000; CBP Dec. 08-25, 73 FR 40725, July 16, 2008]

§ 4.88 Vessels with residue cargo for foreign ports.

(a) Any foreign vessel or documented vessel with a registry which arrives at a port in the United States from a for- eign port shall not be required to unlade any merchandise manifested for a foreign destination provided a bond on Customs Form 301, containing the bond conditions set forth in § 113.64 of this chapter relating to international carriers in a suitable amount is on file with the director of the port of first entry. 119

(b) The port director shall designate the items of such merchandise, if any, for which foreign landing certifi- cates 120 will be required.

(c) If the vessel clears directly for- eign from the first port of arrival, cargo brought in from foreign ports and retained on board may be declared on the Cargo Declaration Outward With Commercial Forms, Customs Form 1302–A (see § 4.63), by the inser- tion of the following statement:

All cargo declared on entry in this port as cargo for discharge at foreign ports and so shown on the Cargo Declaration filed upon entry has been and is retained on board.

If any such cargo has been landed, the Cargo Declaration shall describe each item of the cargo from a foreign port which has been retained on board (see § 4.63(a).

(d) If the vessel is proceeding to other ports in the United States with foreign residue cargo on board manifested for discharge at a foreign port or ports, a

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00077 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

68

19 CFR Ch. I (4–1–12 Edition)§ 4.89

121 For the purposes of this part, an inward foreign voyage is completed at the port of final discharge of inbound passengers or cargo, and an outward foreign voyage begins at the port where cargo or passengers are first laden for carriage to a foreign destina- tion.

procedure like that set forth in § 4.85 shall be followed with respect thereto.

[28 FR 14596, Dec. 31, 1963, as amended by T.D. 77–255, 42 FR 56324, Oct. 25, 1977; T.D. 83– 214, 48 FR 46513, Oct. 13, 1983; T.D. 84–193, 49 FR 35485, Sept. 10, 1984; 49 FR 41164, Oct. 19, 1984; CBP Dec. 08-25, 73 FR 40725, July 16, 2008]

§ 4.89 Vessels in foreign trade pro- ceeding via domestic ports and touching at intermediate foreign ports.

(a) A vessel proceeding from port to port in the United States in accordance with §§ 4.85, 4.86, or 4.87 may touch at an intermediate foreign port or ports to lade or discharge cargo or pas- sengers. In such a case the vessel shall obtain clearance from the last port of departure in the United States before proceeding to the intermediate foreign port or ports at which it is intended to touch. The Cargo Declaration Outward With Commercial Forms, Customs Form 1302–A (see § 4.63), shall show the cargo for such foreign destination in the manner provided in § 4.88(c).

(b) The master shall also present to the port director the Cargo Declaration or Cargo Declarations required by §§ 4.85, 4.86, or 4.87, and obtain a permit to proceed on the Vessel Entrance or Clearance Statement, Customs Form 1300, to the next port in the United States at which the vessel will touch.

(c) Upon arrival at the next port in the United States after touching at a foreign port or ports a report of arrival and entry shall be made. The Cargo Declaration, Customs Form 1302, filed at time of entry shall list the cargo laden at the intermediate foreign port or ports.

(d) The master shall also present to the port director the permit to proceed on the Vessel Entrance or Clearance Statement, Customs Form 1300, and the Cargo Declaration from the last previous port in the United States as provided for in §§ 4.85, 4.86, or 4.87.

[T.D. 77–255, 42 FR 56324, Oct. 25, 1977, as amended by T.D. 84–193, 49 FR 35485, Sept. 10, 1984; T.D. 00–22, 65 FR 16517, Mar. 29, 2000]

§ 4.90 Simultaneous vessel trans- actions.

(a) A vessel may proceed from port to port in the United States for the pur-

pose of engaging in two or more of the following transactions simulta- neously, 121 subject to the limitations hereafter mentioned in this section and the conditions stated in the sections indicated in the list:

(1) Coastwise trade (§ 4.80). (2) Touching at a foreign port while

in coastwise trade (§ 4.82). (3) Trade with noncontiguous terri-

tory of the United States (§ 4.84). (4) Carriage of residue cargo or pas-

sengers from foreign ports (§§ 4.85–4.86). (5) Carriage of cargo or passengers

laden for foreign ports (§ 4.87). (6) Carriage of residue cargo for for-

eign ports (§ 4.88). (b) When a vessel is engaged simulta-

neously in two or more such trans- actions, the master shall indicate each type of transaction in which the vessel is engaged in his application for clear- ance on Customs Form 1300. The mas- ter shall conform simultaneously to all requirements of these regulations with respect to each transaction in which the vessel is engaged.

(c) A foreign vessel is not authorized by this section to engage in the coast- wise trade, including trade with non- contiguous territory embraced within the coastwise laws.

(d) A documented vessel may engage in transactions (2), (4), (5), or (6) only if the vessel’s document has a registry. Such a vessel shall not engage in trans- actions (1) or (3) unless permitted by the endorsement on its Certificate of Documentation to do so.

(e) When a single entry bond, con- taining the bond conditions set forth in § 113.64, relating to international car- riers, is filed at any port and it is ap- plicable to the current voyage of the vessel, it shall cover all other trans- actions engaged in on that voyage of a

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00078 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

69

U.S. Customs and Border Protection, DHS; Treasury § 4.92

122 See § 4.33. 123 See § 4.31. 124 [Reserved]

like nature and another bond con- taining the international carrier bond conditions need not be filed.

[28 FR 14596, Dec. 31, 1963, as amended by T.D. 71–169, 36 FR 12605, July 2, 1971; T.D. 83– 214, 48 FR 46513, Oct. 13, 1983; T.D. 84–213, 49 FR 41164, Oct. 19, 1984; T.D. 00–22, 65 FR 16517, Mar. 29, 2000; CBP Dec. 08-25, 73 FR 40725, July 16, 2008]

§ 4.91 Diversion of vessel; trans- shipment of cargo.

(a) If any vessel granted a permit to proceed from one port in the United States for another such port as pro- vided for in §§ 4.81(e), 4.85, 4.87, or 4.88, is, while en route, diverted to a port in the United States other than the one specified in the permit to proceed (Cus- toms Form 1300), 122 the owner or agent of the vessel immediately shall give notice of the diversion to the port di- rector who granted the permit, inform- ing him of the new destination of the vessel and requesting him to notify the director of the latter port. Such notifi- cation by the port director shall con- stitute an amendment of the permit previously granted, shall authorize the vessel to proceed to the new destina- tion, and shall be filed by the director of the latter port with the Form 1300 submitted on entry of the vessel.

(b) If any vessel cleared from a port in the United States for a foreign port as provided for in § 4.60 is diverted, while en route, to a port in the United States other than that from which it was cleared, the owner or agent of the vessel immediately shall give notice of the diversion to the port director who granted the clearance, informing him of the new destination of the vessel and requesting him to notify the director of the latter port. Such notification by the port director shall constitute a per- mit to proceed coastwise, and shall au- thorize the vessel to proceed to the new destination. On arrival at the new des- tination, the master shall immediately report arrival. He shall also make entry within 48 hours by presenting (1) the vessel’s document, (2) the foreign clearance on Form 1300 granted by the director of the port of departure, (3) a certificate that when the vessel was cleared from the last previous port in

the United States there were on board cargo and/or passengers for the ports named in the foreign clearance certifi- cate only and that additional cargo or passengers (have) (have not) been taken on board or discharged since such clearance was granted (specifying the particulars if any passengers or cargo were taken on board or dis- charged), (4) a Crew’s Effects Declara- tion in duplicate of all unentered arti- cles acquired abroad by the officers and crew of the vessel which are still re- tained on board, and (5) a Ship’s Stores Declaration in duplicate of the stores on board.

(c) In a case of necessity, a port di- rector may grant an application on Customs Form 3171 of the owner or agent of an established line for permis- sion to transship 123 all cargo and pas- sengers from one vessel of the United States to another such vessel under Customs supervision, if the first vessel is transporting residue cargo for do- mestic or foreign ports or is on an out- ward foreign voyage or a voyage to noncontiguous territory of the United States, and is following the procedure prescribed in §§ 4.85, 4.87, or 4.88. When inward foreign cargo or passengers are so transshipped to another vessel, a separate traveling manifest (Cargo Declaration, Customs Form 1302, or Passenger List, Customs and Immigra- tion Form I–418) shall be used for the transshipped cargo or passengers, whether or not the forwarding vessel is also carrying other residue cargo or passengers. An appropriate cross-ref- erence shall be made on the separate traveling manifest to show whether any other traveling manifest is being carried forward on the same vessel.

[T.D. 71–169, 36 FR 12605, July 2, 1971, as amended by T.D. 77–255, 42 FR 56324, Oct. 25, 1977; T.D. 93–96, 58 FR 67317, Dec. 21, 1993; T.D. 00–22, 65 FR 16517, Mar. 29, 2000]

§ 4.92 Towing. No vessel other than a vessel docu-

mented for the coastwise trade, or which would be entitled to be so docu- mented except for its tonnage (see § 4.80), may tow a vessel other than a vessel in distress between points in the

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00079 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

70

19 CFR Ch. I (4–1–12 Edition)§ 4.93

125 ‘‘* * * Provided further, That upon such terms and conditions as the Secretary of the

Treasury by regulation may prescribe, and, if the transporting vessel is of foreign reg- istry, upon a finding by the Secretary of the Treasury, pursuant to information obtained and furnished by the Secretary of State, that the government of the nation of registry ex- tends reciprocal privileges to vessels of the United States, this section shall not apply to the transportation by vessels of the United States not qualified to engage in the coast- wise trade, or by vessels of foreign registry, of (a) empty cargo vans, empty lift vans, and empty shipping tanks, (b) equipment for use with cargo vans, lift vans, or shipping tanks, (c) empty barges specifically designed for carriage aboard a vessel, and (d) any empty instrument for international traffic exempt- ed from application of the customs laws by the Secretary of the Treasury pursuant to the provisions of section 322(a), Tariff Act of 1930 (19 U.S.C. 1322(a)), if the articles de- scribed in clauses (a) through (d) are owned or leased by the owner or operator of the transporting vessel and are transported for his use in handling his cargo in foreign trade; and (e) stevedoring equipment and material, if such equipment and material is owned or leased by the owner or operator of the transported vessel, or is owned or leased by the stevedoring company contracting for the lading or unlading of that vessel, and is transported without charge for use in the handling of cargo in foreign trade.’’ (46 U.S.C. 883).

126-130 [Reserved]

U.S. embraced within the coastwise laws, or for any part of such towing (46 U.S.C. App. 316(a)). The penalties for violation of this provision are a fine of from $350 to $1100 against the owner or master of the towing vessel and a fur- ther penalty against the towing vessel of $60 per ton of the towed vessel (46 U.S.C. App. 316(a), as adjusted by the Federal Civil Penalties Inflation Ad- justment Act of 1990).

[T.D. 93–12, 58 FR 13197, Mar. 10, 1993, as amended by T.D. 03–11, 68 FR 13820, Mar. 21, 2003; CBP Dec. 08-25, 73 FR 40725, July 16, 2008]

§ 4.93 Coastwise transportation by cer- tain vessels of empty vans, tanks, and barges, equipment for use with vans and tanks; empty instruments of international traffic; stevedoring equipment and material; proce- dures.

(a) Vessels of the United States pro- hibited from engaging in the coastwise trade and vessels of nations found to grant reciprocal privileges to vessels of the United States may transport the following articles between points em- braced within the coastwise laws of the United States:

(1) Empty cargo vans, empty lift vans, and empty shipping tanks; equip- ment for use with cargo vans, lift vans, or shipping tanks; empty barges spe- cifically designed for carriage aboard a vessel and equipment, excluding pro- pulsion equipment, for use with such barges; and empty instruments of international traffic exempted from ap- plication of the Customs laws by the Secretary of the Treasury pursuant to the provisions of section 322(a), Tariff Act of 1930 (19 U.S.C. 1322(a)), if such articles are owned or leased by the owner or operator of the transporting vessel and are transported for his use in handling his cargo in foreign trade.

(2) Stevedoring equipment and mate- rial, if such equipment and material is owned or leased by the owner or oper- ator of the transporting vessel, or is owned or leased by the stevedoring company contracting for the lading or unlading of that vessel, and is trans- ported without charge for use in the handling of cargo in foreign trade. 125

(b)(1) The following nations have been found to extend privileges recip- rocal to those provided in paragraph (a) of this section for empty cargo vans, empty lift vans, and empty shipping tanks to vessels of the United States:

Antigua and Barbuda Australia Austria Bahamas, The Bahrain Belgium Bermuda Brazil Canada Chile China* Colombia Cyprus Denmark Ecuador Finland France Guatemala Germany, Federal

Republic of Greece Iceland

India Iran Ireland Israel Italy Ivory Coast Japan Kuwait Liberia Luxembourg Malta Marshall Islands,

Republic of the Mexico Netherlands Netherlands Antilles Norway Pakistan Philippines Polish People’s

Republic Portugal

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00080 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

71

U.S. Customs and Border Protection, DHS; Treasury § 4.94

Republic of Korea Republic of Panama Republic of

Singapore Republic of Zaire St. Vincent and the

Grenadines Saudi Arabia South Africa Spain Sweden Taiwan

Union of Soviet Socialist Republics

United Arab Emirates

United Kingdom (including The Cayman Islands and Hong Kong)

Vanuatu, Republic of Yugoslavia, Socialist

Federal Republic of

*See also Taiwan

(2) The following nations have been found to extend similar reciprocal privileges in respect to the other arti- cles mentioned in paragraph (a) of this section:

Antigua and Barbuda Australia Austria Bahamas, The Bahrain Belgium Bermuda Brazil Chile Colombia Denmark Federal Republic of

Germany Finland France Greece Guatemala Iceland India Ireland Israel Italy Ivory Coast Kuwait Liberia Luxembourg Malta

Mexico Netherlands Netherlands Antilles Norway Polish People’s

Republic Portugal Republic of Korea Republic of Panama Republic of

Singapore Republic of Zaire St. Vincent and the

Grenadines South Africa Spain Sweden Taiwan Union of Soviet

Socialist Republics United Arab

Emirates United Kingdom

(including The Cayman Islands and Hong Kong)

Vanuatu, Republic of

(c) Any Cargo Declaration, Customs Form 1302, required to be filed under this part by any foreign vessel shall de- scribe any article mentioned in para- graph (a) of this section laden aboard and transported from one United States port to another, giving its iden- tifying number or symbol, if any, or such other identifying data as may be appropriate, the names of the shipper and consignee, and the destination. The Cargo Declaration shall also in- clude a statement (1) that the articles specified in paragraph (a)(1) of this sec- tion are owned or leased by the owner or operator of the transporting vessel and are transported for his use in hand-

ing his cargo in foreign trade; or (2) that the stevedoring equipment and material specified in paragraph (a)(2) of this section is owned or leased by the owner or operator of the transporting vessel, or is owned or leased by the ste- vedoring company contracting for the lading or unlading of that vessel, and is transported without charge for his use in handling his cargo in foreign trade. If the director of the port of lading is satisfied that there will be sufficient control over the coastwise transpor- tation of the article without identi- fying it by number or symbol or such other identifying data on the Cargo Declaration, he may permit the use of a Cargo Declaration that does not in- clude such information provided the Cargo Declaration includes a state- ment, that the director of the port of unlading will be presented with a state- ment at the time of entry of the vessel that will list the identifying number or symbol or other appropriate identi- fying data for the article to be unladen at that port. Applicable penalties under section 584, Tariff Act of 1930, as amended (19 U.S.C. 1584), shall be as- sessed for violation of this paragraph.

[T.D. 68–302, 33 FR 18436, Dec. 12, 1968]

EDITORIAL NOTE: For FEDERAL REGISTER ci- tations affecting § 4.93, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at www.fdsys.gov.

GENERAL

§ 4.94 Yacht privileges and obligations. (a) Any documented vessel with a

pleasure license endorsement, as well as any undocumented American pleas- ure vessel, shall be used exclusively for pleasure and shall not transport mer- chandise nor carry passengers for pay. Such a vessel which is not engaged in any trade nor in any way violating the Customs or navigation laws of the U.S. may proceed from port to port in the U.S. or to foreign ports without clear- ing and is not subject to entry upon its arrival in a port of the U.S., provided it has not visited a hovering vessel, re- ceived merchandise while in the cus- toms waters beyond the territorial sea, or received merchandise while on the high seas. Such a vessel shall imme- diately report arrival to Customs when

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00081 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

72

19 CFR Ch. I (4–1–12 Edition)§ 4.94

arriving in any port or place within the U.S., including the U.S. Virgin Islands, from a foreign port or place.

(b) A cruising license may be issued to a yacht of a foreign country only if it has been made to appear to the satis- faction of the Secretary of the Treas- ury that yachts of the United States are allowed to arrive at and depart from ports in such foreign country and to cruise in the waters of such ports without entering or clearing at the customhouse thereof and without the payment of any charges for entering or clearing, dues, duty per ton, tonnage, taxes, or charges for cruising licenses. It has been made to appear to the satis- faction of the Secretary of the Treas- ury that yachts of the United States are granted such privileges in the fol- lowing countries:

Argentina Australia Austria Bahama Islands Belgium Bermuda Canada Denmark Finland France Germany, Federal

Republic of Greece Honduras Ireland Italy Jamaica Liberia Marshall Islands

Netherlands New Zealand Norway Saint Kitts and Nevis Saint Vincent and

the Grenadines Sweden Switzerland Turkey United Kingdom and

the Dependencies: the Anguilla Islands, the Isle of Man, the British Virgin Islands, the Cayman Islands, and the Turks and Caicos Islands

(c) In order to obtain a cruising li- cense for a yacht of any country listed in paragraph (b) of this section, there shall be filed with the port director an application therefor executed by either the yacht owner or the master which shall set forth the owner’s name and address and identify the vessel by flag, rig, name, and such other matters as are usually descriptive of a vessel. The application shall also include a descrip- tion of the waters in which the yacht will cruise, and a statement of the probable time it will remain in such waters. Upon approval of the applica- tion, the port director will issue a cruising license in the form prescribed by paragraph (d) of this section permit- ting the yacht, for a stated period not to exceed one year, to arrive and de-

part from the United States and to cruise in specified waters of the United States without entering and clearing, without filing manifests and obtaining or delivering permits to proceed, and without the payment of entrance and clearance fees, or fees for receiving manifests and granting permits to pro- ceed, duty on tonnage, tonnage tax, or light money. The license shall be granted subject to the condition that the vessel shall not engage in trade or violate the laws of the United States in any respect. Upon the vessel’s arrival at any port or place within the U.S. or the U.S. Virgin Islands, the master shall comply with 19 U.S.C. 1433 by im- mediately reporting arrival at the nearest Customs facility or other place designated by the port director. Indi- viduals shall remain on board until di- rected otherwise by the appropriate Customs officer, as provided in 19 U.S.C. 1459.

(d) Cruising licenses shall be in the following form:

LICENSE TO CRUISE IN THE WATERS OF THE UNITED STATES

To Port Directors: For a period of llll from llll(Date)

the llll(Flag) llll (Rig) yacht llll(Name) belonging to llllllll of (Owner’s name) llllllll(Address) shall be permitted to arrive at and depart from the United States and to cruise in the waters of the Customs port of llllllllllllllllllllllll

(Name of port or ports) without entering and clearing, without filing manifests and obtaining or delivering per- mits to proceed, and without the payment of entry and clearance fees, or fees for receiv- ing manifests and granting permits to pro- ceed, duty on tonnage, tonnage tax, or light money.

This license is granted subject to the con- dition that the yacht named herein shall not engage in trade or violate the laws of the United States in any respect. Upon arrival at each port or place in the United States, the master shall report the fact of arrival to the Customs officer at the nearest customhouse. Such report shall be immediately made.

Issued this lllll day of lllllll, 19ll llllllllllllllllllllllll

(Port Director of Customs)

WARNING: This vessel is dutiable: (1) If owned by a resident of the United

States (including Puerto Rico), or brought into the United States (including Puerto

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00082 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

73

U.S. Customs and Border Protection, DHS; Treasury § 4.94a

Rico), for sale or charter to a resident there- of, or

(2) If brought into the United States (in- cluding Puerto Rico) by a nonresident free of duty as part of personal effects and sold or chartered within one year from date of entry.

Any offer to sell or charter (for example, a listing with yacht brokers or agents) is con- sidered evidence that the vessel was brought in for sale or charter to a resident or, if made within one year of entry of a vessel brought in free of duty as personal effects, that the vessel no longer is for the personal use of the non-resident.

If the vessel is sold or chartered, or offered for sale or charter, in the circumstances de- scribed, without the owner first having filed a consumption entry and having paid duty, the vessel may be subject to seizure or to a monetary claim equal to the value of the vessel. See Chapter 89, Additional U.S. Note 1, HTSUS, and subheadings 8903.10, 8903.91, 8903.92, 8903.99.10, 8903.99.20, and 8903.99.90, HTSUS.

(e) A foreign-flag yacht which is not in possession of a cruising license shall be required to comply with the laws ap- plicable to foreign vessels arriving at, departing from, and proceeding be- tween ports of the United States.

[T.D. 69–266, 34 FR 20423, Dec. 31, 1969]

EDITORIAL NOTE: For FEDERAL REGISTER ci- tations affecting § 4.94, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at www.fdsys.gov.

§ 4.94a Large yachts imported for sale. (a) General. An otherwise dutiable

vessel used primarily for recreation or pleasure and exceeding 79 feet in length that has been previously sold by a manufacturer or dealer to a retail con- sumer and that is imported with the intention to offer for sale at a boat show in the United States may qualify at the time of importation for a defer- ral of entry completion and deposit of duty. The following requirements and conditions will apply in connection with a deferral of entry completion and duty deposit under this section:

(1) The importer of record must cer- tify to Customs in writing that the ves- sel is being imported pursuant to 19 U.S.C. 1484b for sale at a boat show in the United States;

(2) The certification referred to in paragraph (a)(1) of this section must be accompanied by the posting of a single

entry bond containing the terms and conditions set forth in appendix C of part 113 of this chapter. The bond will have a duration of 6 months after the date of importation of the vessel, and no extensions of the bond period will be allowed;

(3) The filing of the certification and the posting of the bond in accordance with this section will permit Customs to determine whether the vessel may be released;

(4) All subsequent transactions with Customs involving the vessel in ques- tion, including any transaction re- ferred to in paragraphs (b) through (d) of this section, must be carried out in the same port of entry in which the certification was filed and the bond was posted under this section; and

(5) The vessel in question will not be eligible for issuance of a cruising li- cense under § 4.94 and must comply with the laws respecting vessel entry and clearance when moving between ports of entry during the 6-month bond period prescribed under this section.

(b) Exportation within 6-month period. If a vessel for which entry completion and duty payment are deferred under paragraph (a) of this section is not sold but is exported within the 6-month bond period specified in paragraph (a)(2) of this section, the importer of record must inform Customs in writing of that fact within 30 calendar days after the date of exportation. The bond posted with Customs will be returned to the importer of record and no entry completion and duty payment will be required. The exported vessel will be precluded from reentry under the terms of paragraph (a) of this section for a period of 3 months after the date of exportation.

(c) Sale within 6-month period. If the sale of a vessel for which entry comple- tion and duty payment are deferred under paragraph (a) of this section is completed within the 6-month bond pe- riod specified in paragraph (a)(2) of this section, the importer of record within 15 calendar days after completion of the sale must complete the entry by filing an Entry Summary (Customs Form 7501) and must deposit the appro- priate duty (calculated at the applica- ble rates provided for under subheading

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00083 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

74

19 CFR Ch. I (4–1–12 Edition)§ 4.95

131a Except as otherwise provided by treaty or convention to which the United States is a party, no foreign-flag vessel shall, whether documented as a cargo vessel or otherwise, land in a port of the United States its catch of fish taken on board such vessels on the high seas or fish products processed there- from, or any fish or fish products taken on board such vessel on the high seas from a vessel engaged in fishing operations or in the processing of fish or fish products.’’ (46 U.S.C. 251)

132 [Reserved]

8903.91.00 or 8903.92.00 of the Har- monized Tariff Schedule of the United States and based upon the value of the vessel at the time of importation). Upon entry completion and deposit of duty under this paragraph, the bond posted with Customs will be returned to the importer of record.

(d) Expiration of bond period. If the 6- month bond period specified in para- graph (a)(2) of this section expires without either the completed sale or the exportation of a vessel for which entry completion and duty payment are deferred under paragraph (a) of this section, the importer of record within 15 calendar days after expiration of that 6-month period must complete the entry by filing an Entry Summary (Customs Form 7501) and must deposit the appropriate duty (calculated at the applicable rates provided for under sub- heading 8903.91.00 or 8903.92.00 of the Harmonized Tariff Schedule of the United States and based upon the value of the vessel at the time of importa- tion). Upon entry completion and de- posit of duty under this paragraph, the bond posted with Customs will be re- turned to the importer of record, and a new bond on Customs Form 301, con- taining the bond conditions set forth in § 113.62 of this chapter, may be required by the appropriate port director.

[68 FR 13625, Mar. 20, 2003]

§ 4.95 Records of entry and clearance of vessels.

Permanent records shall be prepared at each customhouse of all entries of vessels on Customs Form 1400 and of all clearances and permits to proceed on Customs Form 1401. Whenever a vessel is diverted, as provided for in § 4.91 (a) or (b), Customs Form 1401 shall be amended to show the new destination. These records shall be open to public inspection.

[T.D. 82–224, 47 FR 53727, Nov. 29, 1982]

§ 4.96 Fisheries. (a) As used in this section: (1) The term ‘‘convention vessel’’

means a Canadian fishing vessel which, at the time of its arrival in the United States, is engaged only in the North Pacific halibut fishery and which is therefore entitled to the privileges pro-

vided for by the Halibut Fishing Ves- sels Convention between the United States and Canada signed at Ottawa, Canada, on March 24, 1950 (T.D. 52862);

(2) The term ‘‘nonconvention fishing vessel’’ means any vessel other than a convention vessel which is employed in whole or in part in fishing at the time of its arrival in the United States and

(i) Which is documented under the laws of a foreign county,

(ii) Which is undocumented, of 5 net tons or over, and owned in whole or in part by a person other than a citizen of the United States, or

(iii) Which is undocumented, of less than 5 net tons, and owned in whole or in part by a person who is neither a cit- izen nor a resident of the United States;

(3) The term ‘‘nonconvention cargo vessel’’ means any vessel which is not employed in fishing at the time of its arrival in the United States, but which is engaged in whole or in part in the transportation of fish or fish prod- ucts 131a and

(i) Which is documented under the laws of a foreign country or

(ii) Which is undocumented and owned by a person other than a citizen of the United States;

(4) The term ‘‘treaty vessel’’ means a Canadian fishing vessel which at the time of its arrival in the United States is engaged in the albacore tuna fishery and which is therefore entitled to the privileges provided for by the treaty with Canada on Pacific Coast Albacore Tuna Vessels and Port Privileges, en- tered into force at Ottawa, Canada, on July 29, 1981 (T.D. 81–227); and

(5) The term ‘‘fishing’’ means the planting, cultivation, or taking of fish, shell fish, marine animals, pearls, shells, or marine vegetation, or the transportation of any of those marine

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00084 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

75

U.S. Customs and Border Protection, DHS; Treasury § 4.96

products to the United States by the taking vessel or another vessel under the complete control and management of a common owner or bareboat charterer.

(b) Except as otherwise provided by treaty or convention to which the United States is a party (see para- graphs (d) and (g) of this section), no foreign-flag vessel shall, whether docu- mented as a cargo vessel or otherwise, land in a port of the United States its catch of fish taken on board such ves- sel on the high seas or fish products processed therefrom, or any fish or fish products taken on board such vessel on the high seas from a vessel engaged in fishing operations or in the processing of fish or fish products. (46 U.S.C. 251). This prohibition applies regardless of the intended ultimate disposition of the fish or fish products (e.g., it applies to transshipments from the foreign vessel to another vessel in United States territorial waters; it applies to landing for transshipment in bond to Canada or Mexico; it applies to landing for exportation under bond; and it ap- plies to landing in a Foreign Trade Zone). However, the prohibition is lim- ited to fish, or fish products processed therefrom, taken on board the foreign vessel on the high seas.

(c) A vessel of the United States to be employed in the fisheries must have a Certificate of Documentation endorsed with a fishery license. ‘‘Fisheries’’ in- cludes processing, storing, transporting (except in foreign commerce), planting, cultivating, catching, taking, or har- vesting fish, shellfish, marine animals, pearls, shells, or marine vegetation in the navigable waters of the United States or the exclusive economic zone.

(d) A convention vessel may come into a port of entry on the Pacific coast of the United States, including Alaska, to land its catch of halibut and incidentally-caught sable fish, or to se- cure supplies, equipment, or repairs. Such a vessel may come into any other port of entry or, if properly authorized to do so under § 101.4(b) of this chapter, into any place other than a port of entry, for the purpose of securing sup- plies, equipment, or repairs only, but shall not land its catch. A convention vessel which comes into the United States as provided for in this para-

graph shall comply with the usual re- quirements applicable to foreign ves- sels arriving at and departing from ports of the United States.

(e) A nonconvention fishing vessel, other than a treaty vessel, may come into a port of entry in the United States or, if granted permission under § 101.4(b) of this chapter, into a place other than a port of entry for the pur- pose of securing supplies, equipment, or repairs, but shall not land its catch. A nonconvention fishing vessel which comes into the United States as pro- vided for in this paragraph shall com- ply with the usual requirements appli- cable to foreign vessels arriving at and departing from ports of the United States.

(f) A nonconvention cargo vessel, al- though not prohibited by law from coming into the United States, shall not be permitted to land in the United States its catch of fish taken on the high seas or any fish or fish products taken on board on the high seas from a vessel employed in fishing or in the processing of fish or fish products, but may land fish taken on board at any place other than the high seas upon compliance with the usual require- ments. Before any such fish may be landed the master shall satisfy the port director that the fish were not taken on board on the high seas by presenting declarations of the master and two or more officers or members of the crew of the vessel, of whom the person next in authority to the master shall be one, or other evidence acceptable to the port director which establishes the place of lading to his satisfaction.

(g) A treaty vessel may come into a port or place of the United States named in Annex B of the Treaty with Canada on Pacific Coast Albacore Tuna Vessels and Port Privileges to land its catch of albacore tuna, or to secure fuel, supplies, equipment and repairs. Such a vessel may come into any other port of entry or, if properly authorized to do so under § 101.4(b) of this chapter, into any place other than a port of entry, for the purpose of securing sup- plies, equipment, or repairs only, but shall not land its catch. A treaty vessel which comes into the United States as provided for in this paragraph shall comply with the usual requirements

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00085 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

76

19 CFR Ch. I (4–1–12 Edition)§ 4.97

133 ‘‘No foreign vessel shall, under penalty of forfeiture, engage in salvaging operations on the Atlantic or Pacific coast of the

United States, in any portion of the Great Lakes or their connecting or tributary wa- ters, including any portion of the Saint Law- rence River through which the international boundary line extends, or in territorial wa- ters of the United States on the Gulf of Mex- ico, except when authorized by a treaty or in accordance with the provisions of section 725 of this title: Provided, however, That if, on in- vestigation, the Secretary of the Treasury is satisfied that no suitable vessel wholly owned by a person who is a citizen of the United States and documented under the laws of the United States or numbered pur- suant to section 288 of this title, is available in any particular locality he may authorize the use of a foreign vessel or vessels in sal- vaging operations in that locality and no penalty shall be incurred for such authorized use.’’ (46 U.S.C. 316(d))

‘‘Nothing in this section shall be held or construed to prohibit or restrict any assist- ance to vessels or salvage operations author- ized by Article II of the treaty between the United States and Great Britain ‘concerning reciprocal rights for United States and Can- ada in the conveyance of prisoners and wrecking and salvage’ signed at Washington, May 18, 1908 (35 Stat. 2036), or by the treaty between the United States and Mexico ‘to fa- cilitate assistance to and salvage of vessels in territorial waters,’ signed at Mexico City, June 13, 1935 (49 Stat. 3359).’’ (46 U.S.C. 316(e))

134 ‘‘The High Contracting Parties agree that vessels and wrecking appliances, either from the United States or from the Domin- ion of Canada, may salve any property wrecked and may render aid and assistance

applicable to foreign vessels arriving at and departing from ports of the United States.

(h) A convention vessel, a nonconven- tion fishing vessel, a nonconvention cargo vessel, or a treaty vessel, which arrives in the United States in distress shall be subject to the usual require- ments applicable to foreign vessels ar- riving in distress. While in the United States, supplies, equipment, or repairs may be secured, but, except as speci- fied in the next sentence, fish shall not be landed unless the vessel’s master, or other authorized representative of the owner, shows to the satisfaction of the port director that it will not be pos- sible, by the exercise of due diligence, for the vessel to transport its catch to a foreign port without spoilage, in which event the port director may allow the vessel upon compliance with all applicable requirements, to land, transship, or otherwise dispose of its catch. Nothing herein shall prevent, upon compliance with normal Customs procedures, a convention vessel arriv- ing in distress from landing its catch of halibut and incidentally-caught sable fish at a port of entry on the Pacific coast, including Alaska; a foreign cargo vessel arriving in distress from landing its cargo of fish taken on board at any place not on the high seas; or a treaty vessel arriving in distress from landing its catch of albacore tuna at a port of entry on the Pacific coast, in- cluding Alaska.

[T.D. 82–144, 47 FR 35182, Aug. 13, 1982, as amended by T.D. 83–214, 48 FR 46513, Oct. 13, 1983; T.D. 83–214, 48 FR 50075, Oct. 31, 1983; T.D. 93–12, 58 FR 13197, Mar. 10, 1993]

§ 4.97 Salvage vessels. (a) Only a vessel of the United

States, a numbered motorboat owned by a citizen, or a vessel operating with- in the purview of paragraph (d) or (e) of this section, shall engage in any sal- vage operation in territorial waters of the United States unless an application addressed to the Commissioner of Cus- toms to use another specified vessel in a completely described operation has been granted. 133

(b) Upon receipt of such an applica- tion, the Commissioner of Customs will cause an investigation to be made im- mediately to determine whether a suit- able vessel of the United States or a suitable numbered motorboat owned by a citizen is available for the operation. If he finds that no such vessel is avail- able and that the facts otherwise war- rant favorable action, he will grant the application.

(c) If the application is granted, the applicant shall make a full report of the operation as soon as possible to the director of the port nearest the place where the operation was conducted.

(d) A Canadian vessel may engage in salvage operations on any vessel in any territorial waters of the United States in which Canadian vessels are per- mitted to conduct such operations by article II of the treaty between the United States and Great Britain signed on May 18, 1908, 134 or by section 725,

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00086 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

77

U.S. Customs and Border Protection, DHS; Treasury § 4.98

to any vessels wrecked, disabled or in dis- tress in the waters or on the shores of the other country in that portion of the St. Law- rence River through which the International Boundary line extends, and, in Lake Ontario, Lake Erie, Lake St. Clair, Lake Huron, and Lake Superior, and in the Rivers Niagara, Detroit, St. Clair, and Ste. Marie, and the Canals at Sault Ste. Marie, and on the shores and in the waters of the other country along the Atlantic and Pacific Coasts within a dis- tance of thirty miles from the International Boundary on such Coasts.

‘‘It is further agreed that such reciprocal wrecking and salvage privileges shall include all necessary towing incident thereto, and that nothing in the Customs, Coasting or other laws or regulations of either country shall restrict in any manner the salving op- erations of such vessels or wrecking appli- ances.

‘‘Vessels from either country employed in salving in the waters of the other shall, as soon as practicable afterwards, make full re- port at the nearest custom house of the country in whose waters such salving takes place.’’ (35 Stat. 2036)

135 ‘‘Canadian vessels and wrecking appur- tenance may render aid and assistance to Ca- nadian or other vessels and property wrecked, disabled, or in distress in the wa- ters of the United States contiguous to the Dominion of Canada.

‘‘This section shall be construed to apply to the canal and improvement of the waters between Lake Erie and Lake Huron, and to the waters of the Saint Mary’s River and Canal: * * *.’’ (46 U.S.C. 725)

The waters of Lake Michigan are not con- tiguous to the Dominion of Canada within the meaning of this statute.

136 ‘‘The High Contracting Parties agree that vessels and rescue apparatus, public or private, of either country, may aid or assist vessels of their own nationality, including

the passengers and crews thereof, which may be disabled or in distress on the shores or within the territorial waters of the other country within a radius of seven hundred and twenty nautical miles of the intersection of the International Boundary Line and the coast of the Pacific Ocean, or within a radius of two hundred nautical miles of the inter- section of the International Boundary Line and the coast of the Gulf of Mexico.’’ (49 Stat. 3360)

title 46, United States Code. 135 If any such vessel engages in a salvage oper- ation in territorial waters of the United States, the owner or master of the vessel shall make a full report of the operation as soon as possible to the director of the port nearest the place where the operation was conducted.

(e) A Mexican vessel may engage in a salvage operation on a Mexican vessel in any territorial waters of the United States in which Mexican vessels are permitted to conduct such operations by the treaty between the United States and Mexico signed on June 13, 1935. 136

[28 FR 14596, Dec. 31, 1963, as amended by T.D. 69–266, 34 FR 20423, Dec. 31, 1969]

§ 4.98 Navigation fees.

(a)(1) The Customs Service shall pub- lish a General Notice in the FEDERAL REGISTER and Customs Bulletin peri- odically, setting forth a revised sched- ule of navigation fees for the following services:

Fee No. and description of services

1 Entry of vessel, including American, from foreign port:

(a) Less than 100 net tons. (b) 100 net tons and over.

2 Clearance of vessel, including American, to foreign port:

(a) Less than 100 net tons. (b) 100 net tons or over.

3 Issuing permit to foreign vessel to proceed from port to port, and receiving mani- fest.

4 Receiving manifest of foreign vessel on arrival from another port, and granting a permit to unlade.

5 Receiving post entry. 6 [Reserved] 7 Certifying payment of tonnage tax for for-

eign vessels only. 8 Furnishing copy of official document, in-

cluding certified outward foreign mani- fest, and others not elsewhere enumer- ated.

The published revised fee schedule shall remain in effect until changed.

(2) The fees shall be calculated in ac- cordance with § 24.17(d) Customs Regu- lations (19 CFR 24.17(d)), and be based upon the amount of time the average service requires of a Customs officer in the fifth step of GS–9.

(3) The party requesting a vessel service described in paragraph (a)(1) of this section for which reimbursable overtime compensation is payable under 19 U.S.C. 267 or 19 U.S.C. 1451 and § 24.16 of this chapter shall pay only the applicable overtime charge, and not both the overtime charge and the fee specified in the fee schedule.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00087 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

78

19 CFR Ch. I (4–1–12 Edition)§ 4.99

(4) The revised fee schedule shall be made available to the public in Cus- toms offices.

(5) The respective fees shall be des- ignated in correspondence and reports by the applicable fee number.

(b) Fee 1 shall be collected at the first port of entry only. It shall not be collected from a vessel entering di- rectly from a port in noncontiguous territory of the United States nor from one entering at a port on a northern, northeastern, or northwestern frontier otherwise than by sea.

(c) Fee 2 shall be collected at the final port of departure from the United States. It shall be collected from a yacht or public vessel which obtains a clearance, but shall not be collected from a vessel clearing directly for a port in noncontiguous territory of the United States nor from one clearing from a port on the northern, north- eastern, or northwestern frontier oth- erwise than by sea. It shall be collected only upon the first clearance each year of a vessel making regular daily trips between a port of the United States and a port in Canada wholly upon inte- rior waters not navigable to the ocean.

(d) Fee 3 shall be collected for grant- ing a permit to a foreign vessel to pro- ceed to another Customs port. It shall be collected from a foreign vessel clear- ing directly for a port in noncontig- uous territory of the United States outside its Customs territory. This fee shall not be collected in the case of a foreign vessel proceeding on a voyage by sea from one port in the United States to another port via a foreign port. Only one fee shall be collected in case of simultaneous vessel trans- actions.

(e) Fee 4 shall be collected for receiv- ing the manifest of a foreign vessel ar- riving from another Customs port. It shall be collected from a foreign vessel entering directly from a port in non- contiguous territory of the United States outside its Customs territory. This fee shall not be collected in the case of a foreign vessel which arrives at one port in the United States from an- other port on a voyage by sea via a for- eign port. Only one fee shall be col- lected in the case of simultaneous ves- sel transactions.

(e–1) Fee 5 shall be collected from a foreign or American vessel at each port where the vessel is required to file a post entry in accordance with the pro- visions of § 4.12(a)(3). An original post entry may be supplemented by addi- tional post entries in instances where items were omitted from the original post entry. A separate fee shall be col- lected for each supplemental post entry made to the original post entry.

(f) [Reserved] (g) Fee 7 shall be collected from for-

eign vessels only. (h) Fee 8 shall be collected for each

copy of any official document, whether certified or not, furnished to any per- son other than a Government officer.

(i) Private and commercial vessels, and passengers aboard commercial ves- sels, may be subject to the payment of fees for services provided in connection with their arrival as set forth in § 24.22 of this chapter.

(j) The loading or unloading of mer- chandise or passengers from a commer- cial vessel at a U.S. port may cause the harbor maintenance fee set forth in § 24.24 of this chapter to be assessed.

[T.D. 69–266, 34 FR 20423, Dec. 31, 1969, as amended by T.D. 74–194, 39 FR 26153, July 17, 1974; T.D. 80–25, 45 FR 3572, Jan. 18, 1980; T.D. 82–224, 47 FR 53727, Nov. 29, 1982; T.D. 84–149, 49 FR 28698, July 16, 1984; T.D. 86–109, 51 FR 21155, June 11, 1986; T.D. 87–44, 52 FR 10211, Mar. 30, 1987; T.D. 93–85, 58 FR 54282, Oct. 21, 1993]

§ 4.99 Forms; substitution. (a) Customs Forms 1300, 1302, 1302–A,

1303, and 1304 printed by private parties or foreign governments shall be accept- ed provided the forms so printed:

(1) Conform to the official Customs forms in wording arrangement, style, size of type, and paper specifications;

(2) Conform to the official Customs forms in size, except that:

(i) Each form may be printed on met- ric A4 size paper, 210 by 297 millimeters (approximately 81⁄4 by 112⁄3 inches).

(ii) The vertical format of Customs Forms 1300, 1302–A, 1303, and 1304 may be increased in size up to a maximum of 14 inches.

(iii) Customs Form 1302 may be re- duced in size to not less than either 81⁄2 by 11 inches or 210 by 297 millimeters (metric A4 size). If Customs Form 1302

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00088 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

79

U.S. Customs and Border Protection, DHS; Treasury Pt. 7

is reduced in size, the size of type used may be reduced proportionately.

(b) If instructions are printed on the reverse side of the official Customs form, the instructions may be omitted from the privately printed forms, but the instructions shall be followed.

(c) The port director, in his discre- tion, may accept a computer printout instead of Customs Form 1302 for use at a specific port. However, to ensure that computer printouts may be used at all ports, the private party or foreign gov- ernment first must obtain specific ap- proval from Headquarters, U.S. Cus- toms Service.

(d) Forms which do not comply with the requirements of this section are not acceptable without the specific ap- proval of the Commissioner of Cus- toms.

[T.D. 79–255, 44 FR 57088, Oct. 4, 1979; T.D. 00– 22, 65 FR 16517, Mar. 29, 2000]

§ 4.100 Licensing of vessels of less than 30 net tons.

(a) The application for a license to import merchandise in a vessel of less than 30 net tons in accordance with section 6, Anti-Smuggling Act of Au- gust 5, 1935, shall be addressed to the Secretary of the Treasury and deliv- ered to the directors of the ports where foreign merchandise is to be imported in such vessel.

(b) The application shall contain the following information:

(1) Name of the vessel, rig, motive power, and home port.

(2) Name and address of the owner. (3) Name and address of the master. (4) Net tonnage of the vessel. (5) Kind of merchandise to be im-

ported. (6) Country or countries of expor-

tation. (7) Ports of the United States where

the merchandise will be imported. (8) Whether the vessel will be used to

transport and import merchandise from a hovering vessel.

(9) Kind of document under which the vessel is operating.

(c) If the port director finds that the applicant is a reputable person and that the revenue would not be jeopard- ized by the issuance of a license, he may issue the license for a period not to exceed 12 months, incorporating

therein any special conditions he be- lieves to be necessary or desirable, and deliver it to the licensee.

(d) The master or owner shall keep the license on board the vessel at all times and exhibit it upon demand of any duly authorized officer of the United States. This license is personal to the licensee and is not transferable.

(e) The Secretary of the Treasury or the port director at whose office the li- cense was issued may revoke the li- cense if any of its terms have been will- fully or intentionally violated or for any other cause which may be consid- ered prejudicial to the revenue or oth- erwise against the interest of the United States.

[T.D. 72–211, 37 FR 16486, Aug. 15, 1972]

§ 4.101 Prohibitions against Customs officers and employees.

No Customs officer or employee shall:

(a) Own, in whole or in part, any ves- sel except a yacht or other pleasure boat;

(b) Act as agent, attorney, or con- signee for the owner or owners of any vessel, or of any cargo or lading on board the vessel; or

(c) Import or be concerned directly or indirectly in the importation of any merchandise for sale into the United States

[T.D. 78–394, 43 FR 49787, Oct. 25, 1978]

PART 7—CUSTOMS RELATIONS WITH INSULAR POSSESSIONS AND GUANTANAMO BAY NAVAL STA- TION

Sec. 7.1 Puerto Rico; spirits and wines with-

drawn from warehouse for shipment to; duty on foreign-grown coffee.

7.2 Insular possessions of the United States other than Puerto Rico.

7.3 Duty-free treatment of goods imported from insular possessions of the United States other than Puerto Rico.

7.4 Watches and watch movements from U.S. insular possessions.

7.11 Guantanamo Bay Naval Station.

AUTHORITY: 19 U.S.C. 66, 1202 (General Note 3(i), Harmonized Tariff Schedule of the United States), 1623, 1624; 48 U.S.C. 1406i.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00089 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

80

19 CFR Ch. I (4–1–12 Edition)§ 7.1

1 [Reserved] 2 ‘‘* * * Distilled spirits and wines which

are rectified in bonded manufacturing ware- houses, class six, and distilled spirits which are reduced in proof and bottled in such warehouses, shall be deemed to have been manufactured within the meaning of this section and may be withdrawn as herein- before provided, and likewise for shipment in bond to Puerto Rico, subject to the provi- sions of this section, and under such regula- tions as the Secretary of the Treasury may prescribe, there to be withdrawn for con- sumption or be rewarehoused and subse- quently withdrawn for consumption: Pro- vided, That upon withdrawal in Puerto Rico for consumption, the duties imposed by the customs laws of the United States shall be collected on all imported merchandise (in its condition as imported) and imported con- tainers used in the manufacture and putting up of such spirits and wines in such ware- houses: Provided further, That no internal- revenue tax shall be imposed on distilled spirits and wines rectified in class six ware- houses if such distilled spirits and wines are exported or shipped in accordance with the provisions of this section, * * *.’’ (Tariff Act of 1930, sec. 311, as amended; 19 U.S.C. 1311)

3 Section 319, Tariff Act of 1930, authorizes the Legislature of Puerto Rico to impose a duty on coffee imported into Puerto Rico, in- cluding coffee grown in a foreign country coming into Puerto Rico from the United States, and the Legislature of Puerto Rico has imposed such a duty.

§ 7.1 Puerto Rico; spirits and wines withdrawn from warehouse for shipment to; duty on foreign-grown coffee.

(a) When spirits and wines are with- drawn from a bonded manufacturing warehouse for shipment in bond to Puerto Rico pursuant to section 311, Tariff Act of 1930, as amended, 1,2 the warehouse withdrawal shall contain on the face thereof a statement of the kind and quantity of all imported mer- chandise (in its condition as imported) and imported containers used in the manufacture and putting up of such spirits and wines. The duty assessed on the imported merchandise and con- tainers so used, and their classification and value, shall be shown on the with- drawal in accordance with § 144.41 of this chapter. If no imported merchan- dise or containers have been used, the warehouse withdrawal shall bear an en- dorsement to that effect. (See §§ 191.105 and 191.106 of this chapter.)

(b) The spirits and wines shall be for- warded in accordance with the general provisions of the regulations governing the transportation of merchandise in bond, part 18 of this chapter.

(c) A regular entry shall be made for all foreign-grown coffee shipped to

Puerto Rico from the United States, but special Customs invoices shall not be required for such shipments. 3

(Secs. 311, 319, 484(a), 46 Stat. 691, as amend- ed, 696, 722, as amended; 19 U.S.C. 1311, 1319, 1484(a); R.S. 251, as amended, sec. 624, 46 Stat. 759 (19 U.S.C. 66, 1624))

[28 FR 14636, Dec. 31, 1963, as amended by T.D. 73–175, 38 FR 17445, July 2, 1973; T.D. 83– 212, 48 FR 46770, Oct. 14, 1983; T.D. 98–16, 63 FR 11004, Mar. 5, 1998]

§ 7.2 Insular possessions of the United States other than Puerto Rico.

(a) Insular possessions of the United States other than Puerto Rico are also American territory but, because those insular possessions are outside the cus- toms territory of the United States, goods imported therefrom are subject to the rates of duty set forth in column 1 of the Harmonized Tariff Schedule of the United States (HTSUS) except as otherwise provided in § 7.3 or in part 148 of this chapter. The principal such in- sular possessions are the U.S. Virgin Islands, Guam, American Samoa, Wake Island, Midway Islands, and Johnston Atoll. Pursuant to section 603(c) of the Covenant to Establish a Common- wealth of the Northern Mariana Islands in Political Union With the United States of America, Public Law 94–241, 90 Stat. 263, 270, goods imported from the Commonwealth of the Northern Mariana Islands are entitled to the same tariff treatment as imports from Guam and thus are also subject to the provisions of § 7.3 and of part 148 of this chapter.

(b) Importations into Guam, Amer- ican Samoa, Wake Island, Midway Is- lands, Johnston Atoll, and the Com- monwealth of the Northern Mariana Is- lands are not governed by the Tariff Act of 1930, as amended, or the regula- tions contained in this chapter. The customs administration of Guam is under the Government of Guam. The customs administration of American Samoa is under the Government of

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00090 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

81

U.S. Customs and Border Protection, DHS; Treasury § 7.3

American Samoa. The customs admin- istration of Wake Island is under the jurisdiction of the Department of the Air Force (General Counsel). The cus- toms administration of Midway Islands is under the jurisdiction of the Depart- ment of the Navy. There is no customs authority on Johnston Atoll, which is under the operational control of the Defense Nuclear Agency. The customs administration of the Commonwealth of the Northern Mariana Islands is under the Government of the Common- wealth.

(c) The Secretary of the Treasury ad- ministers the customs laws of the U.S. Virgin Islands through the U.S. Cus- toms and Border Protection. The im- portation of goods into the U.S. Virgin Islands is governed by Virgin Islands law; however, in situations where there is no applicable Virgin Islands law or no U.S. law specifically made applica- ble to the Virgin Islands, U.S. laws and regulations shall be used as a guide and be complied with as nearly as possible. Tariff classification of, and rates of duty applicable to, goods imported into the U.S. Virgin Islands are established by the Virgin Islands legislature.

[T.D. 97–75, 62 FR 46439, Sept. 3, 1997, as amended by CBP Dec. 08-25, 73 FR 40725, July 16, 2008]

§ 7.3 Duty-free treatment of goods im- ported from insular possessions of the United States other than Puerto Rico.

(a) General. Under the provisions of General Note 3(a)(iv), Harmonized Tar- iff Schedule of the United States (HTSUS), the following goods may be eligible for duty-free treatment when imported into the customs territory of the United States from an insular pos- session of the United States:

(1) Except as provided in Additional U.S. Note 5 to Chapter 91, HTSUS, and except as provided in Additional U.S. Note 2 to Chapter 96, HTSUS, and ex- cept as provided in section 423 of the Tax Reform Act of 1986, as amended (19 U.S.C. 2703 note), goods which are the growth or product of any such insular possession, and goods which were man- ufactured or produced in any such insu- lar possession from materials that were the growth, product or manufacture of any such insular possession or of the

customs territory of the United States, or of both, provided that such goods:

(i) Do not contain foreign materials valued at either more than 70 percent of the total value of the goods or, in the case of goods described in section 213(b) of the Caribbean Basin Economic Recovery Act (19 U.S.C. 2703(b)), more than 50 percent of the total value of the goods; and

(ii) Come to the customs territory of the United States directly from any such insular possession; and

(2) Goods previously imported into the customs territory of the United States with payment of all applicable duties and taxes imposed upon or by reason of importation, provided that:

(i) The goods were shipped from the United States directly to the insular possession and are returned from the insular possession to the United States by direct shipment; and

(ii) There was no remission, refund or drawback of such duties or taxes in connection with the shipment of the goods from the United States to the in- sular possession.

(b) Origin of goods. For purposes of this section, goods shall be considered to be the growth or product of, or man- ufactured or produced in, an insular possession if:

(1) The goods are wholly the growth or product of the insular possession; or

(2) The goods became a new and dif- ferent article of commerce as a result of production or manufacture per- formed in the insular possession.

(c) Foreign materials. For purposes of this section, the term ‘‘foreign mate- rials’’ covers any material incor- porated in goods described in para- graph (b)(2) of this section other than:

(1) A material which was wholly the growth or product of an insular posses- sion or of the customs territory of the United States;

(2) A material which was substan- tially transformed in an insular posses- sion or in the customs territory of the United States into a new and different article of commerce which was then used in an insular possession in the production or manufacture of a new and different article which is shipped directly to the United States; or

(3) A material which may be im- ported into the customs territory of

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00091 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

82

19 CFR Ch. I (4–1–12 Edition)§ 7.3

the United States from a foreign coun- try and entered free of duty either:

(i) At the time the goods which incor- porate the material are entered; or

(ii) At the time the material is im- ported into the insular possession, pro- vided that the material was incor- porated into the goods during the 18- month period after the date on which the material was imported into the in- sular possession.

(d) Foreign materials value limitation. For purposes of this section, the deter- mination of whether goods contain for- eign materials valued at more than 70 or 50 percent of the total value of the goods shall be made based on a com- parison between:

(1) The landed cost of the foreign ma- terials, consisting of:

(i) The manufacturer’s actual cost for the materials or, where a material is provided to the manufacturer without charge or at less than fair market value, the sum of all expenses incurred in the growth, production, or manufac- ture of the material, including general expenses, plus an amount for profit; and

(ii) The cost of transporting those materials to the insular possession, but excluding any duties or taxes assessed on the materials by the insular posses- sion and any charges which may accrue after landing; and

(2) The final appraised value of the goods imported into the customs terri- tory of the United States, as deter- mined in accordance with section 402 of the Tariff Act of 1930, as amended (19 U.S.C. 1401a).

(e) Direct shipment—(1) General. For purposes of this section, goods shall be considered to come to the United States directly from an insular posses- sion, or to be shipped from the United States directly to an insular possession and returned from the insular posses- sion to the United States by direct shipment, only if:

(i) The goods proceed directly to or from the insular possession without passing through any foreign territory or country;

(ii) The goods proceed to or from the insular possession through a foreign territory or country, the goods do not enter into the commerce of the foreign territory or country while en route to

the insular possession or the United States, and the invoices, bills of lading, and other shipping documents show the insular possession or the United States as the final destination; or

(iii) The goods proceed to or from the insular possession through a foreign territory or country, the invoices and other shipping documents do not show the insular possession or the United States as the final destination, and the goods:

(A) Remained under the control of the customs authority of the foreign territory or country;

(B) Did not enter into the commerce of the foreign territory or country ex- cept for the purpose of sale other than at retail, and the port director is satis- fied that the importation into the insu- lar possession or the United States re- sults from the original commercial transaction between the importer and the producer or the latter’s sales agent; and

(C) Were not subjected to operations in the foreign territory or country other than loading and unloading and other activities necessary to preserve the goods in good condition.

(2) Evidence of direct shipment. The port director may require that appro- priate shipping papers, invoices, or other documents be submitted within 60 days of the date of entry as evidence that the goods were shipped to the United States directly from an insular possession or shipped from the United States directly to an insular possession and returned from the insular posses- sion to the United States by direct shipment within the meaning of para- graph (e)(1) of this section, and such evidence of direct shipment shall be subject to such verification as deemed necessary by the port director. Evi- dence of direct shipment shall not be required when the port director is oth- erwise satisfied, taking into consider- ation the kind and value of the mer- chandise, that the goods qualify for duty-free treatment under General Note 3(a)(iv), HTSUS, and paragraph (a) of this section.

(f) Documentation. (1) When goods are sought to be admitted free of duty as provided in paragraph (a)(1) of this sec- tion, there shall be filed with the

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00092 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

83

U.S. Customs and Border Protection, DHS; Treasury § 7.3

entry/entry summary a properly com- pleted certificate of origin on CBP Form 3229, signed by the chief or as- sistant chief customs officer or other official responsible for customs admin- istration at the port of shipment, showing that the goods comply with the requirements for duty-free entry set forth in paragraph (a)(1) of this sec- tion. Except in the case of goods which incorporate a material described in paragraph (c)(3)(ii) of this section, a certificate of origin shall not be re- quired for any shipment eligible for in- formal entry under § 143.21 of this chap- ter or in any case where the port direc- tor is otherwise satisfied that the goods qualify for duty-free treatment under paragraph (a)(1) of this section.

(2) When goods in a shipment not eli- gible for informal entry under § 143.21 of this chapter are sought to be admit- ted free of duty as provided in para-

graph (a)(2) of this section, the fol- lowing declarations shall be filed with the entry/entry summary unless the port director is satisfied by reason of the nature of the goods or otherwise that the goods qualify for such duty- free entry:

(i) A declaration by the shipper in the insular possession in substantially the following form:

I, llllllllll (name) of llllllllll (organization) do hereby declare that to the best of my knowledge and belief the goods identified below were sent directly from the United States on llllll, 19ll, to llllllllll (name) of llllllllll (organization) on llllllllll (insular possession) via the llllllllll (name of carrier) and that the goods remained in said insular possession until shipped by me directly to the United States via the llllllllll (name of carrier) on llllll, 19ll.

Marks Numbers Quantity Description Value

Dated at llllllll, this llll day of llllll, 19ll. Signature: llllllllllllllllll

(ii) A declaration by the importer in the United States in substantially the following form:

I, llllllllll (name), of llllllllll (organization) declare that the (above) (attached) declaration by the shipper in the insular possession is true and correct to the best of my knowledge and belief, that the goods in question were pre- viously imported into the customs territory of the United States and were shipped to the insular possession from the United States without remission, refund or drawback of any duties or taxes paid in connection with that prior importation, and that the goods arrived in the United States directly from the insular possession via the llllllllll (name of carrier) on llllll, 19ll.

llllllllllllllllllllllll

(Date)

llllllllllllllllllllllll

(Signature)

(g) Warehouse withdrawals; drawback. Merchandise may be withdrawn from a bonded warehouse under section 557 of the Tariff Act of 1930, as amended (19 U.S.C. 1557), for shipment to any insu- lar possession of the United States other than Puerto Rico without pay- ment of duty, or with a refund of duty if the duties have been paid, in like manner as for exportation to foreign countries. No drawback may be allowed under section 313 of the Tariff Act of 1930, as amended (19 U.S.C. 1313), on goods manufactured or produced in the United States and shipped to any insu- lar possession. No drawback of inter- nal-revenue tax is allowable under 19 U.S.C. 1313 on goods manufactured or produced in the United States with the use of domestic tax-paid alcohol and shipped to Wake Island, Midway Is- lands or Johnston Atoll.

[T.D. 97–75, 62 FR 46439, Sept. 3, 1997, as amended by CBP Dec. 08-25, 73 FR 40725, July 16, 2008]

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00093 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

84

19 CFR Ch. I (4–1–12 Edition)§ 7.4

§ 7.4 Watches and watch movements from U.S. insular possessions.

(a) The issuance of an International Trade Administration Form ITA–360, Certificate of Entitlement to Secure the Refund of Duties on Watches and Watch Movements, by the Department of Commerce, authorizes a producer of watches in the U.S. insular possessions to file requests with CBP for the refund of duties paid on imports of watches, watch movements (including solid state watches and watch movements), and watch parts (excepting separate watch cases and any articles con- taining any materials to which rates of duty set forth in Column 2, Harmonized Tariff Schedule of the United States (19 U.S.C. 1202) apply). The amount of the refund requested may be up to the value specified in the certificate, pro- vided that the articles for which re- funds are requested were entered dur- ing a 3-year period beginning 2 years before the date of issuance of the Form ITA–360 certificate from the Depart- ment of Commerce.

(b) The Form ITA–360 may not be used to secure refunds. To secure a re- fund, the party requesting the refund of duties (claimant) must present to CBP Form ITA–361, Request for Refund of Duties on Watches and Watch Move- ments, properly executed, and authen- ticated by the Department of Com- merce.

(c) By completing Form ITA–361, the insular producer may either:

(1) Transfer its entitlement, in whole or in part, to any other party for any consideration agreed to by the insular producer and the transferee, or

(2) Request the refund of duties to itself.

(d) A claimant must file Form ITA– 361 with CBP at the same port where the watch import entry was originally filed and duties paid. The documenta- tion accompanying Form ITA–361 shall include a copy of the import entry, pro- viding proof that duty was paid on the watches and watch movements.

(e) When requesting the refund of du- ties on Form ITA–361, the claimant also must complete and submit to CBP the declaration on the form which reads as follows:

I declare that the information given above is true and correct to the best of my knowl-

edge and belief; that no notices of expor- tation of articles with benefit of drawback were filed upon exportation of this merchan- dise from the United States; that no liq- uidated refunds on the articles relating to the present claim have been paid; and that no protest or request for litigation for refund of duties paid and herewith claimed has been made.

(f) A fee of 1 percent will be deducted from each refund request as reimburse- ment to salaries and expenses of those CBP personnel processing the request.

(g) Form ITA–360 expires 1 year from its date of issuance. Any refund request on Form ITA–361 made by either the insular producer itself or any trans- feree named on Form ITA–360 must be filed within this 1-year period. This ex- piration date applies equally to all re- fund requests, whether a single request for the entire amount specified in the Form ITA–361 certificate or multiple requests for partial amounts. Refund requests will be accepted until either the amount specified in the certificate is depleted or until the certificate ex- pires 1 year from its date of issuance.

(h) CBP will process only those re- fund requests made in accordance with the joint rules of the Departments of Commerce and the Interior governing the issuance and handling of certifi- cates and the transfer of entitlements as contained in 15 CFR part 303.

[T.D. 84–16, 49 FR 1481, Jan. 12, 1984, as amended by T.D. 84–211, 49 FR 39044, Oct. 3, 1984; T.D. 89–1, 53 FR 51252, Dec. 21, 1988. Re- designated and amended by T.D. 97–75, 62 FR 46441, Sept. 3, 1997 ; CBP Dec. 08-25, 73 FR 40725, July 16, 2008]

§ 7.11 Guantanamo Bay Naval Station. Articles of foreign origin may enter

the area (both land and water) of the Guantanamo Bay Naval Station free of duty, but such articles shall be subject to duty upon their subsequent entry into the United States.

[28 FR 14636, Dec. 31, 1963]

PART 10—ARTICLES CONDI- TIONALLY FREE, SUBJECT TO A REDUCED RATE, ETC.

Subpart A—General Provisions

ARTICLES EXPORTED AND RETURNED

Sec.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00094 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

85

U.S. Customs and Border Protection, DHS; Treasury Pt. 10

10.1 Domestic products; requirements on entry.

10.3 Drawback; internal-revenue tax. 10.4 Internal-revenue marks; erasure. 10.5 Shooks and staves; cloth boards; port

director’s account. 10.6 Shooks and staves; claim for duty ex-

emption. 10.7 Substantial containers or holders. 10.8 Articles exported for repairs or alter-

ations. 10.8a Imported articles exported and re-

imported. 10.9 Articles exported for processing. 10.10 [Reserved]

ARTICLES ASSEMBLED ABROAD WITH UNITED STATES COMPONENTS

10.11 General. 10.12 Definitions. 10.13 Statutory provision: Subheading

9802.00.80, Harmonized Tariff Schedule of the United States (19 U.S.C. 1202).

10.14 Fabricated components subject to the exemption.

10.15 Fabricated components not subject to the exemption.

10.16 Assembly abroad. 10.17 Valuation of exempted components. 10.18 Valuation of assembled articles. 10.19–10.20 [Reserved] 10.21 Updating cost data and other informa-

tion. 10.23 Standards, quotas, and visas. 10.24 Documentation. 10.25 Textile components cut to shape in

the United States and assembled abroad. 10.26 Articles assembled or processed in a

beneficiary country in whole of U.S. components or ingredients; articles as- sembled in a beneficiary country from textile components cut to shape in the United States.

FREE ENTRY—ARTICLES FOR THE USE OF FOREIGN MILITARY PERSONNEL

10.30c [Reserved]

TEMPORARY IMPORTATIONS UNDER BOND

10.31 Entry; bond. 10.33 Theatrical effects. 10.35 Models of women’s wearing apparel. 10.36 Commercial travelers’ samples; profes-

sional equipment and tools of trade; the- atrical effects and other articles.

10.36a Vehicles, pleasure boats and aircraft brought in for repair or alteration.

10.37 Extension of time for exportation. 10.38 Exportation. 10.39 Cancellation of bond charges. 10.40 Refund of cash deposits.

INTERNATIONAL TRAFFIC

10.41 Instruments; exceptions.

10.41a Lift vans, cargo vans, shipping tanks, skids, pallets, and similar instruments of international traffic; repair components.

10.41b Clearance of serially numbered sub- stantial holders or outer containers.

ARTICLES FOR INSTITUTIONS

10.43 Duty-free status. 10.46 Articles for the United States. 10.47 [Reserved]

WORKS OF ART

10.48 Engravings, sculptures, etc. 10.49 Articles for exhibition; requirements

on entry. 10.50 [Reserved] 10.52 Painted, colored or stained glass win-

dows for religious institutions. 10.53 Antiques. 10.54 Gobelin and other hand-woven tap-

estries.

VEGETABLE OILS

10.56 Vegetable oils, denaturing; release.

POTATOES, CORN, OR MAIZE

10.57 Certified seed potatoes, and seed corn or maize.

BOLTING CLOTHS

10.58 Bolting cloths; marking.

WITHDRAWAL OF SUPPLIES AND EQUIPMENT FOR VESSELS

10.59 Exemption from customs duties and internal-revenue tax.

10.60 Forms of withdrawals; bond. 10.61 Withdrawal permit. 10.62 Bunker fuel oil. 10.62a Blanket withdrawals for certain mer-

chandise. 10.62b Aircraft turbine fuel. 10.63 Landing of supplies and stores from re-

ceiving vessel in the United States. 10.64 Crediting or cancellation of bonds. 10.64a [Reserved] 10.65 Cigars and cigarettes.

ARTICLES EXPORTED FOR EXHIBITION, ETC.

10.66 Articles exported for temporary exhi- bition and returned; horses exported for horse racing and returned; procedure on entry.

10.67 Articles exported for scientific or edu- cational purposes and returned; proce- dure on entry.

THEATRICAL EFFECTS, MOTION-PICTURE FILMS, COMMERCIAL TRAVELERS’ SAMPLES, AND TOOLS OF TRADE

10.68 Procedure. 10.69 Samples to Great Britain and Ireland

under reciprocal agreement.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00095 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

86

19 CFR Ch. I (4–1–12 Edition)Pt. 10

ANIMALS AND BIRDS

10.70 Purebred animals for breeding pur- poses; certificate.

10.71 Purebred animals; bond for production of evidence; deposit of estimated duties; stipulation.

10.72–10.73 [Reserved] 10.74 Animals straying across boundary for

pasturage; offspring. 10.75 Wild animals and birds; zoological col-

lections. 10.76 Game animals and birds. 10.77 [Reserved]

PRODUCTS OF AMERICAN FISHERIES

10.78 Entry. 10.79 [Reserved]

SALT FOR CURING FISH

10.80 Remission of duty; withdrawal; bond. 10.81 Use in any port. 10.82 [Reserved] 10.83 Bond; cancellation; extension.

AUTOMOTIVE PRODUCTS

10.84 Automotive vehicles and articles for use as original equipment in the manu- facture of automotive vehicles.

MASTER RECORDS, AND METAL MATRICES

10.90 Master records and metal matrices.

PROTOTYPES

10.91 Prototypes used exclusively for prod- uct development and testing.

10.92–10.97 [Reserved]

FLUXING MATERIAL

10.98 Copper-bearing fluxing material.

ETHYL ALCOHOL

10.99 Importation of ethyl alcohol for non- beverage purposes.

UNITED STATES GOVERNMENT IMPORTATIONS

10.100 Entry, examination, and tariff status. 10.101 Immediate delivery. 10.102 Duty-free entries. 10.103 American goods returned. 10.104 Temporary importation entries for

United States Government agencies.

WHEAT

10.106 [Reserved]

RESCUE AND RELIEF WORK

10.107 Equipment and supplies; admission.

PRODUCTS EXPORTED UNDER LEASE AND REIMPORTED

10.108 Entry of reimported articles exported under lease.

STRATEGIC MATERIALS OBTAINED BY BARTER OR EXCHANGE

10.110 [Reserved]

LATE FILING OF FREE ENTRY AND REDUCED DUTY DOCUMENTS

10.112 Filing free entry documents or re- duced duty documents after entry.

INSTRUMENTS AND APPARATUS FOR EDUCATIONAL AND SCIENTIFIC INSTITUTIONS

10.114 General provisions. 10.115–10.119 [Reserved]

VISUAL OR AUDITORY MATERIALS

10.121 Visual or auditory materials of an educational, scientific, or cultural char- acter.

RATE OF DUTY DEPENDENT UPON ACTUAL USE

10.131 Circumstances in which applicable. 10.132 [Reserved] 10.133 Conditions required to be met. 10.134 Declaration of intent. 10.135 Deposit of duties. 10.136 Suspension of liquidation. 10.137 Records of use. 10.138 Proof of use. 10.139 Liquidation.

IMPORTATIONS NOT OVER $200 AND BONA FIDE GIFTS

10.151 Importations not over $200. 10.152 Bona-fide gifts. 10.153 Conditions for exemption.

GENERALIZED SYSTEM OF PREFERENCES

10.171 General. 10.172 Claim for exemption from duty under

the Generalized System of Preferences. 10.173 Evidence of country of origin. 10.174 Evidence of direct shipment. 10.175 Imported directly defined. 10.176 Country of origin criteria. 10.177 Cost or value of materials produced

in the beneficiary developing country. 10.178 Direct costs of processing operations

performed in the beneficiary developing country.

10.178a Special duty-free treatment for sub- Saharan African countries.

CANADIAN CRUDE PETROLEUM

10.179 Canadian crude petroleum subject to a commercial exchange agreement be- tween United States and Canadian refin- ers.

CERTAIN FRESH, CHILLED, OR FROZEN BEEF

10.180 Certification.

WATCHES AND WATCH MOVEMENTS FROM U.S. INSULAR POSSESSIONS

10.181–10.182 [Reserved]

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00096 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

87

U.S. Customs and Border Protection, DHS; Treasury Pt. 10

CIVIL AIRCRAFT

10.183 Duty-free entry of civil aircraft, air- craft engines, ground flight simulators, parts, components, and subassemblies.

Subpart B—Caribbean Basin Initiative

10.191 General. 10.192 Claim for exemption from duty under

the CBI. 10.193 Imported directly. 10.194 Evidence of direct shipment. 10.195 Country of origin criteria. 10.196 Cost or value of materials produced

in a beneficiary country or countries. 10.197 Direct costs of processing operations

performed in a beneficiary country or countries.

10.198 Evidence of country of origin. 10.198a Duty reduction for certain leather-

related articles. 10.198b Products of Puerto Rico processed in

a beneficiary country. 10.199 Duty-free entry for certain beverages

produced in Canada from Caribbean rum.

Subpart C—Andean Trade Preference

10.201 Applicability. 10.202 Definitions. 10.203 Eligibility criteria in general. 10.204 Imported directly. 10.205 Country of origin criteria. 10.206 Value content requirement. 10.207 Procedures for filing duty-free treat-

ment claim and submitting supporting documentation.

Subpart D—Textile and Apparel Articles Under the African Growth and Oppor- tunity Act

10.211 Applicability. 10.212 Definitions. 10.213 Articles eligible for preferential

treatment. 10.214 Certificate of Origin. 10.215 Filing of claim for preferential treat-

ment. 10.216 Maintenance of records and submis-

sion of Certificate by importer. 10.217 Verification and justification of

claim for preferential treatment.

Subpart E—United States-Caribbean Basin Trade Partnership Act

TEXTILE AND APPAREL ARTICLES UNDER THE UNITED STATES-CARIBBEAN BASIN TRADE PARTNERSHIP ACT

10.221 Applicability. 10.222 Definitions. 10.223 Articles eligible for preferential

treatment. 10.224 Certificate of Origin. 10.225 Filing of claim for preferential treat-

ment.

10.226 Maintenance of records and submis- sion of Certificate by importer.

10.227 Verification and justification of claim for preferential treatment.

10.228 Additional requirements for pref- erential treatment of brassieres.

NON-TEXTILE ARTICLES UNDER THE UNITED STATES-CARIBBEAN BASIN TRADE PARTNER- SHIP ACT

10.231 Applicability. 10.232 Definitions. 10.233 Articles eligible for preferential tariff

treatment. 10.234 Certificate of Origin. 10.235 Filing of claim for preferential tariff

treatment. 10.236 Maintenance of records and submis-

sion of Certificate by importer. 10.237 Verification and justification of

claim for preferential tariff treatment.

Subpart F—Andean Trade Promotion and Drug Eradication Act

APPAREL AND OTHER TEXTILE ARTICLES UNDER THE ANDEAN TRADE PROMOTION AND DRUG ERADICATION ACT

10.241 Applicability. 10.242 Definitions. 10.243 Articles eligible for preferential

treatment. 10.244 Certificate of Origin. 10.245 Filing of claim for preferential treat-

ment. 10.246 Maintenance of records and submis-

sion of Certificate by importer. 10.247 Verification and justification of

claim for preferential treatment. 10.248 Additional requirements for pref-

erential treatment of brassieres.

EXTENSION OF ATPA BENEFITS TO TUNA AND CERTAIN OTHER NON-TEXTILE ARTICLES

10.251 Applicability. 10.252 Definitions. 10.253 Articles eligible for preferential

treatment. 10.254 Certificate of Origin. 10.255 Filing of claim for preferential treat-

ment. 10.256 Maintenance of records and submis-

sion of Certificate by importer. 10.257 Verification and justification of

claim for preferential treatment.

Subpart G—United States-Canada Free Trade Agreement

10.301 Scope and applicability. 10.302 Eligibility criteria in general. 10.303 Originating goods. 10.304 Exclusions. 10.305 Value content requirement. 10.306 Direct shipment to the United States. 10.307 Documentation.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00097 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

88

19 CFR Ch. I (4–1–12 Edition)Pt. 10

10.308 Records retention. 10.309 Verification of documentation. 10.310 Election to average for motor vehi-

cles. 10.311 Documentation for election to aver-

age for motor vehicles.

Subpart H—United States-Chile Free Trade Agreement

GENERAL PROVISIONS

10.401 Scope. 10.402 General definitions.

IMPORT REQUIREMENTS

10.410 Filing of claim for preferential tariff treatment upon importation.

10.411 Certification of origin or other infor- mation.

10.412 Importer obligations. 10.413 Validity of certification. 10.414 Certification or other information

not required. 10.415 Maintenance of records. 10.416 Effect of noncompliance; failure to

provide documentation regarding trans- shipment.

TARIFF PREFERENCE LEVEL

10.420 Filing of claim for tariff preference level.

10.421 Goods eligible for tariff preference claims.

10.422 Submission of certificate of eligi- bility.

10.423 Certificate of eligibility not required. 10.424 Effect of noncompliance; failure to

provide documentation regarding trans- shipment of non-originating cotton or man-made fiber fabric or apparel goods.

10.425 Transit and transshipment of non- originating cotton or man-made fiber fabric or apparel goods.

EXPORT REQUIREMENTS

10.430 Export requirements. 10.431 Failure to comply with requirements.

POST-IMPORTATION DUTY REFUND CLAIMS

10.440 Right to make post-importation claim and refund duties.

10.441 Filing procedures. 10.442 CBP processing procedures.

RULES OF ORIGIN

10.450 Definitions. 10.451 Originating goods. 10.452 Exclusions. 10.453 Treatment of textile and apparel sets. 10.454 Regional value content. 10.455 Value of materials. 10.456 Accessories, spare parts or tools. 10.457 Fungible goods and materials. 10.458 Accumulation. 10.459 De minimis.

10.460 Indirect materials. 10.461 Retail packaging materials and con-

tainers. 10.462 Packing materials and containers for

shipment. 10.463 Transit and transshipment.

ORIGIN VERIFICATIONS AND DETERMINATIONS

10.470 Verification and justification of claim for preferential treatment.

10.471 Special rule for verification in Chile of U.S. imports of textile and apparel products.

10.472 Verification in the United States of textile and apparel goods.

10.473 Issuance of negative origin deter- minations.

10.474 Repeated false or unsupported pref- erence claims.

PENALTIES

10.480 General. 10.481 Corrected declaration by importers. 10.482 Corrected certification of origin by

exporters or producers. 10.483 Framework for correcting declara-

tions and certifications.

GOODS RETURNED AFTER REPAIR OR ALTERATION

10.490 Goods re-entered after repair or alter- ation in Chile.

Subpart I—United States-Singapore Free Trade Agreement

GENERAL PROVISIONS

10.501 Scope. 10.502 General definitions.

IMPORT REQUIREMENTS

10.510 Filing of claim for preferential tariff treatment upon importation.

10.511 Supporting statement. 10.512 Importer obligations. 10.513 Supporting statement not required. 10.514 Maintenance of records. 10.515 Effect of noncompliance; failure to

provide documentation regarding third country transportation.

TARIFF PREFERENCE LEVEL

10.520 Filing of claim for tariff preference level.

10.521 Goods eligible for tariff preference level claims.

10.522 Submission of certificate of eligi- bility.

RULES OF ORIGIN

10.530 Definitions. 10.531 Originating goods. 10.532 Integrated Sourcing Initiative. 10.533 De minimis. 10.534 Accumulation.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00098 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

89

U.S. Customs and Border Protection, DHS; Treasury Pt. 10

10.535 Regional value content. 10.536 Value of materials. 10.537 Accessories, spare parts, or tools. 10.538 Fungible goods and materials. 10.539 Retail packaging materials and con-

tainers. 10.540 Packing materials and containers for

shipment. 10.541 Indirect materials. 10.542 Third country transportation. 10.543 Certain apparel goods made from fab-

ric or yarn not available in commercial quantities.

ORIGIN VERIFICATIONS AND DETERMINATIONS

10.550 Verification and justification of claim for preferential treatment.

10.551 Issuance of negative origin deter- minations.

10.552 Information sharing by CBP regard- ing textile and apparel goods produced in the United States.

10.553 Textile and apparel site visits. 10.554 Exclusion of textile or apparel goods

for intentional circumvention.

PENALTIES

10.560 General. 10.561 Corrected claim or supporting state-

ment. 10.562 Framework for correcting claims or

supporting statements.

GOODS RETURNED AFTER REPAIR OR ALTERATION

10.570 Goods re-entered after repair or alter- ation in Singapore.

Subpart J—Dominican Republic-Central America-United States Free Trade Agreement

GENERAL PROVISIONS

10.581 Scope. 10.582 General definitions.

IMPORT REQUIREMENTS

10.583 Filing of claim for preferential tariff treatment upon importation.

10.584 Certification. 10.585 Importer obligations. 10.586 Certification not required. 10.587 Maintenance of records. 10.588 Effect of noncompliance; failure to

provide documentation regarding trans- shipment.

EXPORT REQUIREMENTS

10.589 Certification for goods exported to a Party.

POST-IMPORTATION DUTY REFUND CLAIMS

10.590 Right to make post-importation claim and refund duties.

10.591 Filing procedures.

10.592 CBP processing procedures.

RULES OF ORIGIN

10.593 Definitions. 10.594 Originating goods. 10.595 Regional value content. 10.596 Value of materials. 10.597 Accumulation. 10.598 De minimis. 10.599 Fungible goods and materials. 10.600 Accessories, spare parts, or tools. 10.601 Retail packaging materials and con-

tainers. 10.602 Packing materials and containers for

shipment. 10.603 Indirect materials. 10.604 Transit and transshipment. 10.605 Goods classifiable as goods put up in

sets.

TARIFF PREFERENCE LEVEL

10.606 Filing of claim for tariff preference level.

10.607 Goods eligible for tariff preference level claims.

10.608 Submission of certificate of eligi- bility for certain apparel goods of Nica- ragua.

10.609 Transshipment of non-originating cotton or man-made fiber apparel goods.

10.610 Effect of noncompliance; failure to provide documentation regarding trans- shipment of non-originating cotton or man-made fiber apparel goods.

ORIGIN VERIFICATIONS AND DETERMINATIONS

10.616 Verification and justification of claim for preferential tariff treatment.

10.617 Special rule for verifications in a Party of U.S. imports of textile and ap- parel goods.

10.618 Issuance of negative origin deter- minations.

10.619 Repeated false or unsupported pref- erence claims.

PENALTIES

10.620 General. 10.621 Corrected claim or certification by

importers. 10.622 Corrected certification by exporters

or producers. 10.623 Framework for correcting claims or

certifications.

GOODS RETURNED AFTER REPAIR OR ALTERATION

10.624 Goods re-entered after repair or alter- ation in a Party.

RETROACTIVE PREFERENTIAL TARIFF TREATMENT FOR TEXTILE AND APPAREL GOODS

10.625 Refunds of excess customs duties.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00099 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

90

19 CFR Ch. I (4–1–12 Edition)Pt. 10

Subpart K—United States-Jordan Free Trade Agreement

GENERAL PROVISIONS

10.701 Scope. 10.702 Definitions.

IMPORT REQUIREMENTS

10.703 Filing of claim for preferential tariff treatment.

10.704 Declaration. 10.705 Importer obligations. 10.706 Declaration not required. 10.707 Maintenance of records. 10.708 Effect of noncompliance; failure to

provide documentation regarding third- country transportation.

RULES OF ORIGIN

10.709 Country of origin criteria. 10.710 Value-content requirement. 10.711 Imported directly.

ORIGIN VERIFICATIONS

10.712 Verification of claim for preferential tariff treatment.

Subpart L [Reserved]

Subpart M—United States-Morocco Free Trade Agreement

GENERAL PROVISIONS

10.761 Scope. 10.762 General definitions.

IMPORT REQUIREMENTS

10.763 Filing of claim for preferential tariff treatment upon importation.

10.764 Declaration. 10.765 Importer obligations. 10.766 Declaration not required. 10.767 Maintenance of records. 10.768 Effect of noncompliance; failure to

provide documentation regarding trans- shipment.

RULES OF ORIGIN

10.769 Definitions. 10.770 Originating goods. 10.771 Textile or apparel goods. 10.772 Accumulation. 10.773 Value of materials. 10.774 Direct costs of processing operations. 10.775 Packaging and packing materials and

containers for retail sale and for ship- ment.

10.776 Indirect materials. 10.777 Imported directly.

TARIFF PREFERENCE LEVEL

10.778 Filing of claim for tariff preference level.

10.779 Goods eligible for tariff preference claims.

10.780 Transshipment of non-originating fabric or apparel goods.

10.781 Effect of noncompliance; failure to provide documentation regarding trans- shipment of non-originating fabric or ap- parel goods.

ORIGIN VERIFICATIONS AND DETERMINATIONS

10.784 Verification and justification of claim for preferential treatment.

10.785 Issuance of negative origin deter- minations.

PENALTIES

10.786 Violations relating to the MFTA.

GOODS RETURNED AFTER REPAIR OR ALTERATION

10.787 Goods re-entered after repair or alter- ation in Morocco.

Subpart N—United States-Bahrain Free Trade Agreement

GENERAL PROVISIONS

10.801 Scope. 10.802 General definitions.

IMPORT REQUIREMENTS

10.803 Filing of claim for preferential tariff treatment upon importation.

10.804 Declaration. 10.805 Importer obligations. 10.806 Declaration not required. 10.807 Maintenance of records. 10.808 Effect of noncompliance; failure to

provide documentation regarding trans- shipment.

RULES OF ORIGIN

10.809 Definitions. 10.810 Originating goods. 10.811 Textile or apparel goods. 10.812 Accumulation. 10.813 Value of materials. 10.814 Direct costs of processing operations. 10.815 Packaging and packing materials and

containers for retail sale and for ship- ment.

10.816 Indirect materials. 10.817 Imported directly.

TARIFF PREFERENCE LEVEL

10.818 Filing of claim for tariff preference level.

10.819 Goods eligible for tariff preference claims.

10.820 Certificate of eligibility. 10.821 Declaration. 10.822 Transshipment of non-originating

fabric or apparel goods. 10.823 Effect of non-compliance; failure to

provide documentation regarding trans- shipment of non-originating fabric or ap- parel goods.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00100 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

91

U.S. Customs and Border Protection, DHS; Treasury Pt. 10

ORIGIN VERIFICATIONS AND DETERMINATIONS

10.824 Verification and justification of claim for preferential treatment.

10.825 Issuance of negative origin deter- minations.

PENALTIES

10.826 Violations relating to the BFTA.

GOODS RETURNED AFTER REPAIR OR ALTERATION

10.827 Goods re-entered after repair or alter- ation in Bahrain.

Subpart O—Haitian Hemispheric Oppor- tunity through Partnership Encourage- ment Act of 2006 and 2008

10.841 Applicability. 10.842 Definitions. 10.843 Articles eligible for duty-free treat-

ment. 10.844 Value-content requirement. 10.845 Retroactive application of duty-free

treatment for certain apparel articles. 10.846 Imported directly. 10.847 Filing of claim for duty-free treat-

ment. 10.848 Declaration of compliance. 10.849 Importer obligations. 10.850 Verification of claim for duty-free

treatment.

Subpart P—United States-Oman Free Trade Agreement

GENERAL PROVISIONS

10.861 Scope. 10.862 General definitions.

IMPORT REQUIREMENTS

10.863 Filing of claim for preferential tariff treatment upon importation.

10.864 Declaration. 10.865 Importer obligations. 10.866 Declaration not required. 10.867 Maintenance of records. 10.868 Effect of noncompliance; failure to

provide documentation regarding trans- shipment.

POST-IMPORTATION DUTY REFUND CLAIMS

10.869 Right to make post-importation claim and refund duties.

10.870 Filing procedures. 10.871 CBP processing procedures.

RULES OF ORIGIN

10.872 Definitions. 10.873 Originating goods. 10.874 Textile or apparel goods. 10.875 Accumulation. 10.876 Value of materials. 10.877 Direct costs of processing operations.

10.878 Packaging and packing materials and containers for retail sale and for ship- ment.

10.879 Indirect materials. 10.880 Imported directly.

TARIFF PREFERENCE LEVEL

10.881 Filing of claim for tariff preference level.

10.882 Goods eligible for tariff preference claims.

10.883 [Reserved] 10.884 Declaration. 10.885 Transshipment of non-originating ap-

parel goods. 10.886 Effect of non-compliance; failure to

provide documentation regarding trans- shipment of non-originating apparel goods.

ORIGIN VERIFICATIONS AND DETERMINATIONS

10.887 Verification and justification of claim for preferential treatment.

10.888 Issuance of negative origin deter- minations.

PENALTIES

10.889 Violations relating to the OFTA.

GOODS RETURNED AFTER REPAIR OR ALTERATION

10.890 Goods re-entered after repair or alter- ation in Oman.

Subpart Q—United States-Peru Trade Promotion Agreement

GENERAL PROVISIONS

10.901 Scope. 10.902 General definitions.

IMPORT REQUIREMENTS

10.903 Filing of claim for preferential tariff treatment upon importation.

10.904 Certification. 10.905 Importer obligations. 10.906 Certification not required. 10.907 Maintenance of records. 10.908 Effect of noncompliance; failure to

provide documentation regarding trans- shipment.

EXPORT REQUIREMENTS

10.909 Certification for goods exported to Peru.

POST-IMPORTATION DUTY REFUND CLAIMS

10.910 Right to make post-importation claim and refund duties.

10.911 Filing procedures. 10.912 CBP processing procedures.

RULES OF ORIGIN

10.913 Definitions.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00101 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

92

19 CFR Ch. I (4–1–12 Edition)Pt. 10

10.914 Originating goods. 10.915 Regional value content. 10.916 Value of materials. 10.917 Accumulation. 10.918 De minimis. 10.919 Fungible goods and materials. 10.920 Accessories, spare parts, or tools. 10.921 Goods classifiable as goods put up in

sets. 10.922 Retail packaging materials and con-

tainers. 10.923 Packing materials and containers for

shipment. 10.924 Indirect materials. 10.925 Transit and transshipment.

ORIGIN VERIFICATIONS AND DETERMINATIONS

10.926 Verification and justification of claim for preferential tariff treatment.

10.927 Special rule for verifications in Peru of U.S. imports of textile and apparel goods.

10.928 Issuance of negative origin deter- minations.

10.929 Repeated false or unsupported pref- erence claims.

PENALTIES

10.930 General. 10.931 Corrected claim or certification by

importers. 10.932 Corrected certification by U.S. ex-

porters or producers. 10.933 Framework for correcting claims or

certifications.

GOODS RETURNED AFTER REPAIR OR ALTERATION

10.934 Goods re-entered after repair or alter- ation in Peru.

Subpart R—United States-Korea Free Trade Agreement

GENERAL PROVISIONS

10.1001 Scope. 10.1002 General definitions.

IMPORT REQUIREMENTS

10.1003 Filing of claim for preferential tariff treatment upon importation.

10.1004 Certification. 10.1005 Importer obligations. 10.1006 Certification not required. 10.1007 Maintenance of records. 10.1008 Effect of noncompliance; failure to

provide documentation regarding trans- shipment.

EXPORT REQUIREMENTS

10.1009 Certification for goods exported to Korea.

Post-Importation Duty Refund Claims

10.1010 Right to make post-importation claim and refund duties.

10.1011 Filing procedures. 10.1012 CBP processing procedures.

RULES OF ORIGIN

10.1013 Definitions. 10.1014 Originating goods. 10.1015 Regional value content. 10.1016 Value of materials. 10.1017 Accumulation. 10.1018 De minimis. 10.1019 Fungible goods and materials. 10.1020 Accessories, spare parts, or tools. 10.1021 Goods classifiable as goods put up in

sets. 10.1022 Retail packaging materials and con-

tainers. 10.1023 Packing materials and containers

for shipment. 10.1024 Indirect materials. 10.1025 Transit and transshipment.

ORIGIN VERIFICATIONS AND DETERMINATIONS

10.1026 Verification and justification of claim for preferential tariff treatment.

10.1027 Special rule for verifications in Korea of U.S. imports of textile and ap- parel goods.

10.1028 Issuance of negative origin deter- minations.

10.1029 Repeated false or unsupported pref- erence claims.

PENALTIES

10.1030 General. 10.1031 Corrected claim or certification by

importers. 10.1032 Corrected certification by U.S. ex-

porters or producers. 10.1033 Framework for correcting claims or

certifications.

GOODS RETURNED AFTER REPAIR OR ALTERATION

10.1034 Goods re-entered after repair or al- teration in Korea.

AUTHORITY: 19 U.S.C. 66, 1202 (General Note 3(i), Harmonized Tariff Schedule of the United States (HTSUS)), 1321, 1481, 1484, 1498, 1508, 1623, 1624, 3314.

Section 10.17 also issued under 19 U.S.C. 1401a, 1402;

Sections 10.25 and 10.26 also issued under 19 U.S.C. 3592;

Sections 10.41, 10.41a, 10.107 also issued under 19 U.S.C. 1322;

Section 10.41b also issued under 19 U.S.C. 1202 (Chapter 98, Subchapter III, U.S. Note 3, HTSUS);

Section 10.53 also issued under 16 U.S.C. 1521, et seq.;

Section 10.59 also issued under 19 U.S.C. 1309, 1317;

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00102 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

93

U.S. Customs and Border Protection, DHS; Treasury § 10.1

Sections 10.61, 10.62, 10.63, 10.64, 10.64a also issued under 19 U.S.C. 1309;

Sections 10.62a, 10.65 also issued under 19 U.S.C. 1309, 1317, 1555, 1556, 1557, 1646a;

§ 10.62b also issued under 19 U.S.C. 1557; Sections 10.70, 10.71 also issued under 19

U.S.C. 1486; Sections 10.80, 10.81, 10.82, 10.83 also issued

under 19 U.S.C. 1313 (e) and (i); Section 10.91 also issued under Pub. L. 106–

476 (114 Stat. 2101), sections 1434, 1435; Section 10.121 also issued under 19 U.S.C.

2501. Sections 10.171 through 10.178a also issued

under 19 U.S.C. 2461 et seq.; Section 10.183 also issued under 19 U.S.C.

1202 (General Note 6, HTSUS); Sections 10.191 through 10.199 also issued

under 19 U.S.C. 2701 et seq.; Sections 10.201 through 10.207 also issued

under 19 U.S.C. 3203; Sections 10.211 through 10.217 also issued

under 19 U.S.C. 3721; Sections 10.221 through 10.228 and §§ 10.231

through 10.237 also issued under 19 U.S.C. 2701 et seq.

Sections 10.241 through 10.248 and §§ 10.251 through 10.257 also issued under 19 U.S.C. 3203.

Sections 10.401 through 10.490 also issued under Pub. L. 108–77, 117 Stat. 909 (19 U.S.C. 3805 note).

Sections 10.501 through 10.570 also issued under 19 U.S.C. 1202 (General Note 25, HTSUS) and Pub. L. 108–78, 117 Stat. 948 (19 U.S.C. 3805 note).

Sections 10.581 through 10.625 also issued under 19 U.S.C. 1202 (General Note 29, HTSUS), 19 U.S.C. 1520(d), and Pub. L. 109–53, 119 Stat. 462 (19 U.S.C. 4001 note).

Section 10.699 also issued under Pub. L. 109–53, 119 Stat. 462.

Sections 10.701 through 10.712 also issued under 19 U.S.C. 1202 (General Note 18, HTSUS) and Pub. L. 107–43, 115 Stat. 243 (19 U.S.C. 2112 note).

Sections 10.761 through 10.789 also issued under Pub. L. 108–302, 118 Stat. 1103 (19 U.S.C. 3805 note).

Sections 10.801 through 10.829 also issued under 19 U.S.C. 1202 (General Note 30,

HTSUS) and Pub. L. 109–169, 119 Stat. 3581 (19 U.S.C. 3805 note).

Sections 10.841 through 10.850 also issued under 19 U.S.C. 2703A.

Sections 10.861 through 10.890 also issued under 19 U.S.C. 1202 (General Note 31, HTSUS) and Pub. L. 109–283, 120 Stat. 1191 (19 U.S.C. 3805 note).

Sections 10.901 through 10.934 also issued under 19 U.S.C. 1202 (General Note 32, HTSUS), 19 U.S.C. 1520(d), and Pub. L. 110– 138, 121 Stat. 1455 (19 U.S.C. 3805 note).

Sections 10.1001 through 10.1034 also issued under 19 U.S.C. 1202 (General Note 33, HTSUS), 19 U.S.C. 1520(d), and Pub. L. 112–41, 125 Stat. 428 (19 U.S.C. 3805 note).

SOURCE: 28 FR 14663, Dec. 31, 1963, unless otherwise noted.

Subpart A—General Provisions

ARTICLES EXPORTED AND RETURNED

§ 10.1 Domestic products; require- ments on entry.

(a) Except as otherwise provided for in paragraph (g), (h), (i) or (j) of this section or elsewhere in this part or in § 145.35 of this chapter, the following documents shall be filed in connection with the entry of articles in a shipment valued over $2,000 and claimed to be free of duty under subheading 9801.00.10 or 9802.00.20, Harmonized Tariff Sched- ule of the United States (HTSUS):

(1) A declaration by the foreign ship- per in substantially the following form:

I, lllllllllll, declare that to the best of my knowledge and belief the articles herein specified were ex- ported from the United States, from the port of llllllll on or about llllllll, 19ll, and that they are re- turned without having been advanced in value or improved in condition by any proc- ess of manufacture or other means.

Marks Number Quantity Description Value, in U.S. coin

.......................... .......................... ........................................................ ........................................................

.......................... .......................... ........................................................ ........................................................

.......................... .......................... ........................................................ ........................................................

.......................... .......................... ........................................................ ........................................................

.......................... .......................... ........................................................ (Date) (Signature)

.......................... .......................... ........................................................ (Address) (Capacity)

(2) A declaration by the owner, im- porter, consignee, or agent having knowledge of the facts regarding the

claim for free entry. If the owner or ul- timate consignee is a corporation, such

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00103 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

94

19 CFR Ch. I (4–1–12 Edition)§ 10.1

declaration may be signed by the presi- dent, vice president, secretary, or treasurer of the corporation, or may be signed by any employee or agent of the corporation who holds a power of attor- ney executed under the conditions out- lined in subpart C, part 141 of this chapter and a certification by the cor- poration that such employee or other agent has or will have knowledge of the pertinent facts. This declaration shall be in substantially the following form:

I, lllllll, declare that the (above) (attached) declara- tion by the foreign shipper is true and cor- rect to the best of my knowledge and belief, that the articles were manufactured by llllllll (name of manufacturer) lo- cated in llllllll (city and state), that the articles were not manufactured or pro- duced in the United States under subheading 9813.00.05, HTSUS, and that the articles were exported from the United States without benefit of drawback.

llllllllllllllllllllllll

(Date)

llllllllllllllllllllllll

(Address)

llllllllllllllllllllllll

(Signature)

llllllllllllllllllllllll

(Capacity)

(b) In any case in which the value of the returned articles exceeds $2,000 and the articles are not clearly marked with the name and address of the U.S. manufacturer, the port director may require, in addition to the declarations required in paragraph (a) of this sec- tion, such other documentation or evi- dence as may be necessary to substan- tiate the claim for duty-free treat- ment. Such other documentation or evidence may include a statement from the U.S. manufacturer verifying that the articles were made in the United States, or a U.S. export invoice, bill of lading or airway bill evidencing the U.S. origin of the articles and/or the reason for the exportation of the arti- cles.

(c) A certificate from the master of a vessel stating that products of the United States are returned without having been unladen from the export- ing vessel may be accepted in lieu of the declaration of the foreign shipper required by paragraph (a)(1) of this sec- tion.

(d) If the port director is reasonably satisfied, because of the nature of the articles or production of other evi- dence, that the articles are imported in circumstances meeting the require- ments of subheading 9801.00.10 or 9802.00.20, HTSUS, and related section and additional U.S. notes, he may waive the requirements for producing the documents specified in paragraph (a) of this section.

(e) No evidence relative to the condi- tions of subheading 9801.00.10, HTSUS, shall be required in the case of articles the product of the U.S. in use at the time of importation as the usual cov- erings or containers of merchandise not subject to an ad valorem rate of duty unless such articles would be du- tiable if not products of the U.S. under General Rule of Interpretation 5, HTSUS.

(f) In the case of photographic films and dry plates manufactured in the United States (except motion picture films to be used for commercial pur- poses) exposed abroad and entered under subheading 9802.00.20, HTSUS, the requirements of paragraphs (a) and (c) of this section are applicable except that the declaration by the foreign shipper provided for in paragraph (a)(1) to the effect that the articles ‘‘are re- turned without having been advanced in value or improved in condition by any process of manufacture or other means’’ shall be crossed out, and the entrant shall show on the declaration provided for in paragraph (a)(2) that the subject articles when exported were of U.S. manufacture and are returned after having been exposed, or exposed and developed, and, in the case of mo- tion picture films, that they will not be used for commercial purposes.

(g) Aircraft and aircraft parts and equipment. (1) In the case of aircraft and aircraft parts and equipment re- turned to the United States under sub- heading 9801.00.10, HTSUS, by or for the account of an aircraft owner or oper- ator and intended for use in his own aircraft operations, within or outside the United States, the entry summary may be made on Customs Form 3311. The entry summary on Customs Form 3311 shall be executed by the entrant and supported by the entry documenta- tion required by § 142.3 of this chapter.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00104 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

95

U.S. Customs and Border Protection, DHS; Treasury § 10.1

If the Customs officer is satisfied that the articles are products of the United States, that they have not been im- proved in condition or advanced in value while abroad, and that no draw- back has been or will be paid, the other documents described in this section shall not be required, and no bond need be filed for their production.

(2) The entrant shall show on Cus- toms Form 3311:

(i) The name and address of the air- craft owner or operator by whom or for whose account the articles are re- turned to the United States, in the block headed ‘‘Articles Returned To (Name and Address)’’,

(ii) The name of the importing vessel or conveyance,

(iii) The date of its arrival, (iv) A description of the articles, (v) The value of the articles, and (vi) That the articles are intended for

use by the aircraft owner or operator in his own aircraft operations.

(3) If Customs Form 3311 is filed at time of entry, it shall serve as both the entry and the entry summary.

(h) Nonconsumable vessel stores and equipment. (1) In the case of nonconsumable vessel stores and equip- ment returned to the United States under subheading 9801.00.10, HTSUS, the entry summary may be made on Customs Form 3311. The entry sum- mary on Customs Form 3311 shall be executed in duplicate by the entrant and supported by the entry documenta- tion required by § 142.3 of this chapter. Before an entry summary on Customs Form 3311 may be accepted for nonconsumable vessel stores and equip- ment, the Customs officer shall be sat- isfied that:

(i) The articles are products of the United States.

(ii) The articles have not been im- proved in condition or advanced in value while abroad.

(iii) No drawback has been or will be paid, and

(iv) No duty equal to an internal rev- enue tax is payable under subheading 9801.00.80, HTSUS.

(2) The documentation described in paragraph (a) of this section shall not be required in connection with an entry for nonconsumable vessel stores and equipment on Customs Form 3311.

(3) To satisfy the Customs officer that no drawback has been or will be paid on the articles in connection with their removal from the United States, the master of the vessel or other per- son having knowledge of the facts shall furnish a written declaration which may be made on the reverse side of Customs Form 3311 showing that the articles were:

(i) Exported as stores or equipment on a United States vessel or a vessel operated by the United States Govern- ment,

(ii) Not landed in a foreign country, except for any needed repairs, adjust- ments, or refilling and return to the vessel from which landed or,

(iii) For transshipment as stores or equipment to another vessel.

(4) The entrant also shall show: (i) The name of the importing vessel, (ii) The date of its arrival, (iii) A description of the articles, and (iv) The value of the articles. (5) If Customs Form 3311 is filed at

time of entry, it shall serve as both the entry and the entry summary.

(i) When the total value of articles of claimed American origin contained in any shipment does not exceed $250 and such articles are found to be unques- tionably products of the United States and do not appear to have been ad- vanced in value or improved in condi- tion while abroad and no quota is in- volved, free entry thereof may be made under subheading 9801.00.10 on Customs Form 3311, executed by the owner, im- porter, consignee, or agent and filed in duplicate, without regard to the re- quirement of filing the documentation provided for in paragraph (a) of this section, unless the Customs officer has reason to believe that Customs draw- back or exemption from internal rev- enue tax, or both, were probably al- lowed on exportation of the articles or that they are otherwise subject to duty. The entrant shall show on Cus- toms Form 3311 the name of the im- porting conveyance, the date of its ar- rival, the name of the country from which the articles were returned to the United States, and the value of the ar- ticles. The entrant shall also produce evidence of his right to make entry (ex- cept as provided in § 141.11(b) of this chapter). If the Customs officer is not

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00105 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

96

19 CFR Ch. I (4–1–12 Edition)§ 10.3

entirely certain that the articles to be entered under this paragraph by a nominal consignee are products of the United States, the actual owner or ul- timate consignee thereof may be re- quired to execute a Customs Form 3311.

(j) In the case of products of the United States, when the aggregate value of the shipment does not exceed $10,000 and the products are imported—

(1) For the purposes of repair or al- teration, prior to reexportation, or

(2) After having been either rejected or returned by the foreign purchaser to the United States for credit, free entry thereof may be made under subheading 9801.00.10, HTSUS, on Customs Form 3311 (a Customs Form 7501 must be sub- mitted as well for such articles as pro- vided in § 143.23(h) of this chapter), exe- cuted by the owner, importer, con- signee, or agent and filed in duplicate, without regard to the requirement of filing the documentation provided for in paragraph (a) of this section, unless the Customs officer has reason to be- lieve that Customs drawback or exemp- tion from internal revenue tax, or both, were probably allowed on expor- tation of the articles or that they are otherwise subject to duty. The person making entry shall show on Customs Form 3311 the name of the importing conveyance, the date of its arrival, the name of the country from which the ar- ticles were returned to the United States, and the value of the articles. The person making entry shall also produce evidence of his right to make entry (except as provided in § 141.11(b) of this chapter). If the Customs officer is not entirely certain that the articles to be entered under this paragraph by a nominal consignee are products of the United States, the actual owner or ul- timate consignee thereof may be re- quired to execute a Customs Form 3311.

[T.D. 72–119, 37 FR 8867, May 2, 1972 as amended by T.D. 78–99, 43 FR 13060, Mar. 29, 1978; 43 FR 20003, May 10, 1978; T.D. 79–221, 44 FR 46812, Aug. 9, 1979; T.D. 83–82, 48 FR 14596, Apr. 5, 1983; T.D. 89–1, 53 FR 51246, Dec. 21, 1988; T.D. 94–47, 59 FR 25566, May 17, 1994; T.D. 97–82, 62 FR 51769, Oct. 3, 1997; T.D. 98– 28, 63 FR 16416, Apr. 3, 1998]

§ 10.3 Drawback; internal-revenue tax. (a) Except as prescribed in § 10.1(f) or

in paragraphs (c) and (f) of this section,

no free entry shall be allowed under Chapter 98, Subchapter 1, Harmonized Tariff Schedule of the United States (HTSUS), in the final liquidation of an entry unless the port director is satis- fied by the certificate of exportation or other evidence or information that no drawback was allowed in connection with the exportation from the United States, and unless no internal-revenue tax is imposed on the importation of like articles not previously exported from the United States or, if such tax is being imposed at the time of entry for consumption or withdrawal from warehouse for consumption, the port director is satisfied that an internal- revenue tax on production or importa- tion was paid in respect of the im- ported article before it was exported from the United States and was not re- funded. Except as provided for in § 10.1(f), when it is impracticable, be- cause of the destruction of Customs records or other circumstances, to de- termine whether drawback was al- lowed, or the amount of drawback al- lowed, with respect to an article estab- lished to be a returned product of the United States which has not been ad- vanced in value or improved in condi- tion while abroad, there shall be as- sessed on the returned article an amount of duty determined as follows:

(1) If there is any likelihood that drawback was allowable on the expor- tation of like articles at any time when the imported article may have been ex- ported from the United States, the es- timated amount of any drawback which would have been allowable if duty had been paid on any foreign mer- chandise likely to have been used in the manufacture of the returned article at the rate or rates applicable to such foreign merchandise on the date of im- portation of the returned article (see paragraph (b) of this section), and

(2) If there is any likelihood that a refund or remission of tax was allowed on the exportation of the returned arti- cle, the amount of any internal-rev- enue tax which would be payable at the time of importation if the returned ar- ticle were wholly of foreign origin, but in no such case shall there be assessed more than an amount equal to the duty and tax that would apply if the re- turned article were wholly of foreign

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00106 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

97

U.S. Customs and Border Protection, DHS; Treasury § 10.3

origin and originally imported. (See § 10.7(a).) Except as provided for in § 10.1(f), if the imported article is of a kind which would be subject to an in- ternal-revenue tax if of foreign origin and payment of an internal-revenue tax before exportation without refund thereof is not established, duty shall be assessed on the imported article in an amount equal to the internal-revenue tax imposed at the time of entry for consumption or withdrawal from ware- house for consumption on like articles of foreign origin, plus the amount of any drawback allowed on the expor- tation of the article from the United States; but if no drawback was allowed, the duty equal to internal-revenue tax shall be the total duty to be assessed. If an allowance of drawback on the ex- portation from the United States of the imported article is established, duty shall be assessed in an amount equal to such drawback, plus an amount equal

to any internal-revenue tax which may be assessable in accordance with this paragraph; but in no case shall duty equal to drawback, or to drawback and internal-revenue tax, be assessed in an amount in excess of the ordinary Cus- toms duty and internal-revenue tax ap- plicable to like articles of foreign ori- gin. In any case, where payment of in- ternal-revenue tax before exportation without refund thereof is established, no duty equal to an internal-revenue tax currently in force shall be assessed.

(b) In the absence of satisfactory evi- dence as to the nonallowance of draw- back or the amount thereof allowed on the following articles of American manufacture or production, duty shall be assessed thereon in the amounts re- spectively indicated, the amount shown in each case being considered the fair average amount of drawback allowed on such articles:

Article Duty assessment

Drums, metal (when not exempted from duty in accordance with sec. 10.3(c)) ............... 24 cents each. Hosiery, nylon ..................................................................................................................... 45 cents per dozen. Lead compound, tetraethyl ................................................................................................. $0.003 per kilogram. Lithopone ............................................................................................................................ $0.00065 per kilogram. Oxide, zinc .......................................................................................................................... $0.0029 per kilogram. Piece goods, cotton:

Bleached ...................................................................................................................... $0.03199 per square meter. Dyed ............................................................................................................................ $0.03454 per square meter. Printed ......................................................................................................................... $0.03226 per square meter.

Piece goods, nylon: Dyed $0.29086 per square meter. Piece goods, rayon:

Printed ......................................................................................................................... $0.04867 per square meter. Other than printed (white, piece dyed or yarn dyed) .................................................. $0.08478 per square meter.

Tallow, refined, inedible ...................................................................................................... $0.003 per kilogram.

(c) The following articles shall be ad- mitted free of duty, even though ex- ported from the United States with benefit of drawback:

(1) Any article of a kind which would be admitted free of duty otherwise than under Chapter 98, Subchapter 1, HTSUS, if of foreign origin;

(2) Substantial containers or holders of domestic manufacture, including shooks and staves when returned as boxes or barrels, when in use at the time of importation as the usual con- tainers of merchandise;

(3) Any article provided for in sub- headings 9801.00.70 or 9801.00.80, HTSUS, with respect to which the port director has determined that the collection of duty under such subheadings 9801.00.70

or 9801.00.80, HTSUS, would involve an expense and inconvenience to the Gov- ernment disproportionate to the prob- able amount of such duty; and

(4) Other articles of domestic manu- facture which are in use at the time of importation as the usual coverings or containers of merchandise not subject to an ad valorem rate of duty, and which have not been advanced in value or improved in condition while abroad by any process of manufacture or other means.

(d) Articles manufactured or pro- duced in the United States in a Cus- toms bonded warehouse and exported shall be subject on reimportation to a duty equal to the total duty and inter- nal-revenue tax, if any, imposed at the

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00107 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

98

19 CFR Ch. I (4–1–12 Edition)§ 10.4

time of entry for consumption or with- drawal from warehouse for consump- tion with respect to the importation of like articles not previously exported from the United States.

(e) Animals straying across the bor- der or driven across the border for pas- turage purposes or for feeding to im- prove them for the market and not re- turned within 8 months are excluded from free entry as domestic products returned.

(f) Tobacco products and cigarette papers and tubes classifiable under sub- heading 9801.00.80, HTSUS, may be re- leased from customs custody without the payment of that part of the duty attributable to the internal-revenue tax for return to internal-revenue bond as provided by section 5704(d) of the In- ternal Revenue Code of 1954.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 68–104, 33 FR 5616, Apr. 11, 1968; T.D. 83– 240, 48 FR 53098, Nov. 25, 1983; T.D. 89–1, 53 FR 51246, Dec. 21, 1988; T.D. 93–66, 58 FR 44130, Aug. 19, 1993]

§ 10.4 Internal-revenue marks; erasure. Internal-revenue brands or marks on

casks or other containers previously exported from the United States must be erased at the importer’s expense under Customs supervision before their delivery from Customs custody.

§ 10.5 Shooks and staves; cloth boards; port director’s account.

(a) Shooks and staves produced in the United States and returned in the form of complete boxes or barrels in use as the usual containers of merchandise are exempt from any duties imposed by the tariff laws upon similar containers made of foreign shooks or staves, pro- vided their identity is established under the regulations in this part.

(b) The term ‘‘shook’’ embraces only shooks which at the time of expor- tation from this country are ready to be assembled into boxes or barrels without further cutting to size; except that box shooks may be exported in double lengths and cut abroad. The number of boxes made from such shooks which may be imported into this country free of duty cannot exceed the number of complete sets of shooks exported.

(c) [Reserved]

(d) An exporter of shooks or staves in respect of which free entry is to be claimed when returned as boxes or bar- rels shall file in triplicate with the di- rector of the port of exportation, at least 6 hours before the landing of the articles on the exporting vessel, a Cer- tificate of Registration, Customs Form 4455.

(e) The Certificate of Registration, CF 4455, shall be completed in trip- licate by the port director after verification from the manifest of the exporting vessel and the return of the lading officer. The original shall be for- warded by the port director to the con- signee. The duplicate copy shall be given to the exporter and the triplicate copy shall be retained.

(f) Whenever boxes or barrels alleged to have been manufactured from Amer- ican shooks or staves are shipped to the United States from a person abroad other than the one to whom they were exported from the United States, the importer shall be required to obtain from the foreign consignee to whom the shooks or staves were originally exported from this country the certifi- cate or certificates, Customs Form 4455, covering the exportation of the shooks or staves from the United States, or an extract therefrom signed by such consignee, showing the number of shooks or staves covered by such certificate or certificates, together with the number of superficial feet of such shooks or staves. Such Form 4455, or extract therefrom, shall be filed by the importer in connection with the entry of the boxes or barrels.

(g) Accounts shall be kept by the di- rector of the port of exportation of the shooks and staves as to each expor- tation thereof and as to the returns thereof in boxes, barrels, etc. Notifica- tions of such returns shall be given to the port of exportation by the director of the port of importation. When re- turns in the form of boxes, barrels, etc., entirely account for the shooks and staves exported as shown on the appropriate Customs Form 4455, the port director maintaining the account shall so inform the port director mak- ing inquiry about the merchandise being imported and alleged to contain shooks or staves covered by the par- ticular exportation.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00108 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

99

U.S. Customs and Border Protection, DHS; Treasury § 10.7

*Cross out inapplicable words.

(h) A record of cloth boards of domes- tic manufacture exported to be wrapped with foreign textiles shall be kept by the port director in a similar manner as for shooks and staves. Cloth boards of domestic manufacture are conditionally free of duty under Chap- ter 98, subchapter 1, Harmonized Tariff Schedule of the United States (HTSUS). If such boards are advanced in value or improved in condition while abroad, free entry shall be denied on importation.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 78–99, 43 FR 13060, Mar. 29, 1978; T.D. 89– 1, 53 FR 51247, Dec. 21, 1988; T.D. 98–52, 63 FR 29954, June 2, 1998]

§ 10.6 Shooks and staves; claim for duty exemption.

An importer, seeking an exemption from duty on account of boxes or bar- rels made from American shooks or staves, must make such a claim on Customs Form 4455 at the time of filing the entry. Upon receipt, from the direc- tor of the port of exportation of the shooks and staves, of corroboration that the records of exportation do not conflict materially with such a claim, the exemption may be allowed. If the claim for an exemption is disallowed in full or in part, the importer may file a request within 15 days of the date of the port director’s notice to him of any disallowance, for referral of the ques- tion to the Commissioner of Customs for review.

[T.D. 87–75, 52 FR 20066, May 29, 1987, as amended by T.D. 98–52, 63 FR 29954, June 2, 1998]

§ 10.7 Substantial containers or hold- ers.

(a) Substantial containers or holders, which are products of the United States, which are of the usual and ordi- nary types used in the shipment or transportation of goods, which are re- usable for such purposes, and which are imported containing or holding mer- chandise, shall be entered under the general regulations governing the free entry of domestic products exported and returned. When such containers or holders are imported not containing or holding merchandise they may be ad- mitted without entry if readily identi- fiable as products of the United States.

(b) Substantial containers or holders, which are of foreign production and previously imported duty paid, which are of the usual or ordinary types used in the shipment or transportation of goods, which are reusable for such pur- pose, and which are imported con- taining or holding merchandise, shall be exempt from duty if (1) exported in accordance with the regulations con- tained in § 10.5 (d) and (e), and (2) there is filed in connection with the entry a certificate of the foreign shipper in the form prescribed by paragraph (c) of this section.

(c) The certificate to be furnished by the foreign shipper for the use of the director of the port of entry shall be in the following form:

I, llllllll, of llllllll, do hereby certify that to the best of my knowl- edge and belief the substantial containers and holders mentioned in (the annexed in- voice) (invoice No. llll of llll, 19ll) * are of the manufacture of llllllll and were exported from the United States at the port of llllll, per S.S. llllllll on lllll, 19ll, and that the same are being returned to the United States (empty) filled with llll) (holdings lllllll).*

——————————————————————— Shipper

(d) The port director, after verification of the foreign shipper’s certificate with the records of the di- rector of the port of exportation in this country, shall allow free entry to the extent the basis for such allowance is verified. The procedure in the last two sentences of § 10.6 shall be applicable.

(e) If claim for exemption from duty for such containers or holders of for- eign production previously imported duty paid is made at the time of entry, the certificate of the foreign shipper may be accepted if produced at any time prior to the liquidation of the entry.

(f) When such containers or holders of foreign production previously im- ported duty paid are reimported empty, they may be admitted without entry if

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00109 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

100

19 CFR Ch. I (4–1–12 Edition)§ 10.8

readily identifiable as having been pre- viously imported duty paid.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 82–145, 47 FR 35475, Aug. 16, 1982; T.D. 86– 118, 51 FR 22515, June 20, 1986; T.D. 97–82, 62 FR 51769, Oct. 3, 1997]

§ 10.8 Articles exported for repairs or alterations.

(a) Except as otherwise provided for in this section and except in the case of goods covered by § 181.64 of this chap- ter, the following documents shall be filed in connection with the entry of articles which are returned after hav- ing been exported for repairs or alter- ations and which are claimed to be sub- ject to duty only on the value of the re- pairs or alterations performed abroad under subheading 9802.00.40 or 9802.00.50, Harmonized Tariff Schedule of the United States (HTSUS):

(1) A declaration from the person who performed such repairs or alterations, in substantially the following form:

I,llllllll, declare that the articles herein specified are the articles which, in the condition in which they were exported from the United States, were received by me (us) on llllllll, 19ll, fromllllllll (name and address of owner or exporter in the United States); that they were received by me (us) for the sole purpose of being repaired or altered; that only the repairs or alterations described below were performed by me (us); that the full cost or (when no charge is made) value of such repairs or alterations are correctly stated below; and that no substitution what- ever has been made to replace any of the ar- ticles originally received by me (us) from the owner or exporter thereof mentioned above.

Marks and numbers

Description of articles and of re- pairs or al- terations

Full cost or (when no charge is

made) value of

repairs or alterations (see sub- chapter II, chapter 98,

HTSUS)

Total value of articles after re-

pairs or al- terations

llllllllllllllllllllllll

(Date)

llllllllllllllllllllllll

(Address)

llllllllllllllllllllllll

(Signature)

llllllllllllllllllllllll

(Capacity)

(2) A declaration by the owner, im- porter, consignee, or agent having knowledge of the pertinent facts in substantially the following form:

I, lllll, declare that the (above) (attached) declara- tion by the person who performed the repairs or alterations abroad is true and correct to the best of my knowledge and belief; that the articles were not manufactured or produced in the United States under subheading 9813.00.05, HTSUS; that such articles were ex- ported from the United States for repairs or alterations and without benefit of drawback from llllllll (port) on llllllll, 19ll; and that the articles entered in their repaired or altered condition are the same articles that were exported on the above date and that are identified in the (above) (attached) declaration. llllllllllllllllllllllll

(Date) llllllllllllllllllllllll

(Address) llllllllllllllllllllllll

(Signature) llllllllllllllllllllllll

(Capacity)

(b) The port director may require such additional documentation as is deemed necessary to prove actual ex- portation of the articles from the United States for repairs or alter- ations, such as a foreign customs entry, foreign customs invoice, foreign landing certificate, bill of lading, or an airway bill.

(c) If the port director concerned is satisfied, because of the nature of the articles or production of other evi- dence, that the articles are imported under circumstances meeting the re- quirements of subheading 9802.00.40 or 9802.00.50, HTSUS, and related section and additional U.S. notes, he may waive submission of the declarations provided for in paragraph (a) of this section.

(d) The port director shall require at the time of entry a deposit of esti- mated duties based upon the full cost or value of the repairs or alterations. The cost or value of the repairs or al- terations outside the United States, which is to be set forth in the invoice and entry papers as the basis for the assessment of duty under subheading 9802.00.40 or 9802.00.50, HTSUS, shall be

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00110 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

101

U.S. Customs and Border Protection, DHS; Treasury § 10.9

limited to the cost or value of the re- pairs or alterations actually performed abroad, which will include all domestic and foreign articles furnished for the repairs or alterations but shall not in- clude any of the expenses incurred in this country whether by way of engi- neering costs, preparation of plans or specifications, furnishing of tools or equipment for doing the repairs or al- terations abroad, or otherwise.

[T.D. 94–47, 59 FR 25567, May 17, 1994, as amended by T.D. 95–68, 60 FR 46361, Sept. 6, 1995]

§ 10.8a Imported articles exported and reimported.

(a) In addition to regular entry pro- cedures, supplementary documentation is required in connection with duty- free entries under subheading 9801.00.25, Harmonized Tariff Schedule of the United States (19 U.S.C. 1202), of arti- cles which were originally entered duty paid, removed from Customs custody, and subsequently exported, if:

(1) The articles were exported within 3 years after the date of the previous importation.

(2) The articles were not advanced in value or improved in condition by any process of manufacture or other means while abroad.

(3) The articles did not conform to sample or specifications abroad.

(4) The articles are reimported by or for the account of the person who im- ported them into and exported them from the United States.

(b) The following supplementary doc- uments shall be filed in connection with the entry of articles claimed to be free of duty under subheading 9801.00.25, Harmonized Tariff Schedule of the United States:

(1) A declaration by the person abroad who received and is returning the merchandise to the United States, in substantially the following form:

I declare that thelllllllllll (De- scription of articles) were received by me from lllllllllllllllll (Name and address of U.S. exporter), that they have not been advanced in value or improved in condition by any process of manufacture or other means and are being returned to llllllllllllllll(Name and ad- dress of consignee in the United States) be- cause they do not conform to sample or spec- ifications for the following reasons:

llllllllllllllllllllllll

llllllllllllllllllllllll

llllllllllllllllllllllll

llllllllllllllllllllllll

(Date) (Signature) llllllllllllllllllllllll

(Address) (Title)

(2) A declaration by the owner, im- porter, consignee, or agent, in substan- tially the following form:

I declare that the lllllllllll (Description of articles) were previously im- ported into the United States at the Port of llllllll (Name of port), Entry No.lll, on lllllll (Date of entry) by lllllllllll (Name and address of importer) at which time duty was paid; that they were exported from the United States at the Port of llllllll (Name of port) on llllllllll (Date of exportation) by lllllllllll (Name and address of exporter) without benefit of drawback; that the articles are being reimported by or for the account of llllllll, and, that the attached declaration from llllllllllllllll (Name of for- eign shipper) is correct in every respect. llllllllllllllllllllllll

(Date) (Signature) llllllllllllllllllllllll

(Address) (Title)

(c) If the port director concerned is reasonably satisfied because of the na- ture of the articles or production of other evidence that the requirements of subheading 9801.00.25, Harmonized Tariff Schedule of the United States, and the related section and additional U.S. notes have been met, he may waive the production of the documents provided for in paragraph (b) of this section.

[T.D. 72–221, 37 FR 17469, Aug. 29, 1972, as amended by T.D. 89–1, 53 FR 51247, Dec. 21, 1988]

§ 10.9 Articles exported for processing. (a) Except as otherwise provided for

in this section, the following docu- ments shall be filed in connection with the entry of articles which are re- turned after having been exported for further processing and which are claimed to be subject to duty only on the value of the processing performed abroad under subheading 9802.00.60, Harmonized Tariff Schedule of the United States (HTSUS):

(1) A declaration by the person who performed the processing abroad, in substantially the following form:

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00111 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

102

19 CFR Ch. I (4–1–12 Edition)§ 10.9

I, lllll, declare that the articles here- in specified are the articles which, in the condition in which they were exported from the United States, were received by me (us) on llllll, 19 lll, from llllllll (name and address of owner or exporter in the United States); that they were received by me (us) for the sole purpose of being processed; that only the processing described below was effected by me (us); that the full cost or (when no charge is made) value of such processing and the value of the articles after processing are correctly stated below; and that no substitution whatever has been made to replace any of the articles originally received by me (us) from the owner or exporter thereof mentioned above.

Marks and numbers

Description of articles

and of processing

Full cost or (when no charge is

made) value of

processing (see sub- chapter II, chapter 98,

HTSUS)

Total value of articles after proc-

essing

llllllllllllllllllllllll

(Date)

llllllllllllllllllllllll

(Address)

llllllllllllllllllllllll

(Signature)

llllllllllllllllllllllll

(Capacity)

(2) A declaration by the owner, im- porter, consignee, or agent having knowledge of the pertinent facts in substantially the following form:

I, lllll, declare that the (above) (at- tached) declaration by the person who per- formed the processing abroad is true and correct to the best of my knowledge and belief; that the articles were manufactured in the United States by llllllll (name and address) or, if of foreign origin, were subjected to llllllll (show processes of manufacture, such as molding, casting, machining) in the United States by llllllll (name and address); that the articles were not manufactured or pro- duced in the United States under sub- heading 9813.00.05, HTSUS; that the arti- cles were exported for processing and with- out benefit of drawback from llllllll (port) on llllll, 19 lll; that the articles entered in their processed condition are otherwise the same articles that were exported on the above date and that are identified in the (above) (attached) declaration; and that the re-

turned articles will be subjected to llllllll (describe processing to be performed in the United States) by llllllll (name and address of U.S. processor). llllllllllllllll

llllllllllllllllllllllll

(Date)

llllllllllllllllllllllll

(Address)

llllllllllllllllllllllll

(Signature)

llllllllllllllllllllllll

(Capacity)

(b) The port director may require such additional documentation as is deemed necessary to prove actual ex- portation of the articles from the United States for processing, such as a foreign customs entry, foreign customs invoice, foreign landing certificate, bill of lading, or an airway bill.

(c) If the port director concerned is satisfied, because of the nature of the articles or production of other evi- dence, that the articles are imported under circumstances meeting the re- quirements of subheading 9802.00.60, HTSUS, and related section and addi- tional U.S. notes, he may waive sub- mission of the declarations provided for in paragraph (a) of this section.

(d) The port director shall require at the time of entry a deposit of esti- mated duties based upon the full cost or value of the processing. The cost or value of the processing outside the United States, which is to be set forth in the invoice and entry papers as the basis for the assessment of duty under subheading 9802.00.60, HTSUS, shall be limited to the cost or value of the proc- essing actually performed abroad, which will include all domestic and for- eign articles used in the processing but shall not include the exported United States metal article or any of the ex- penses incurred in this country wheth- er by way of engineering costs, prepa- ration of plans or specifications, fur- nishing of tools or equipment for doing the processing abroad, or otherwise.

[T.D. 94–47, 59 FR 25568, May 17, 1994]

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00112 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

103

U.S. Customs and Border Protection, DHS; Treasury § 10.13

§ 10.10 [Reserved]

ARTICLES ASSEMBLED ABROAD WITH UNITED STATES COMPONENTS

§ 10.11 General.

(a) Sections 10.12 through 10.23 set forth definitions and interpretative regulations adopted by the Commis- sioner of Customs pertaining to the construction of subheading 9802.00.80, Harmonized Tariff Schedule of the United States (19 U.S.C. 1202) and re- lated provisions of law. These provi- sions concern claims for the exemption from duty provided by subheading 9802.00.80, Harmonized Tariff Schedule of the United States (19 U.S.C. 1202), for American-made fabricated components which are returned to the United States as parts of articles assembled abroad. The examples included in these sections describe specific situations in which the exemption may or may not be applicable. The definitions and regu- lations that follow are promulgated to inform the public of the constructions and interpretations that the United States Customs Service shall give to relevant statutory terms and to assure the impartial and uniform assessment of duties upon merchandise claimed to be partially exempt from duty under subheading 9802.00.80, Harmonized Tar- iff Schedule of the United States (19 U.S.C. 1202), at the various ports of entry. Nothing in these regulations purports or is intended to restrict the legal right of importers or others to a judicial review of the matters con- tained therein.

(b) Section 10.24 sets forth the docu- mentary requirements applicable to the entry of assembled articles claimed to be subject to the exemption provided under subheading 9802.00.80, Har- monized Tariff Schedule of the United States (19 U.S.C. 1202). Allowance of an importer’s claim is dependent upon meeting the statutory requirements for the exemption under subheading 9802.00.80, Harmonized Tariff Schedule of the United States (19 U.S.C. 1202) and his complying with the documen- tary requirements set forth in § 10.24.

[T.D. 75–230, 40 FR 43021, Sept. 18, 1975, as amended by T.D. 89–1, 53 FR 51247, Dec. 21, 1988; T.D. 97–82, 62 FR 51769, Oct. 3, 1997]

§ 10.12 Definitions. As used in §§ 10.11 through 10.24, the

following terms shall have the mean- ings indicated:

(a) American-made. The term ‘‘Amer- ican-made’’ is used to refer to a prod- uct of the United States as defined in paragraph (e) of this section.

(b) Assembly. ‘‘Assembly’’ means the fitting or joining together of fabricated components.

(c) Exemption. ‘‘Exemption’’ means the deduction of the cost or value of products of the United States which were assembled abroad in accordance with the requirements of subheading 9802.00.80, Harmonized Tariff Schedule of the United States (19 U.S.C. 1202), from the full value of the assembled ar- ticle.

(d) Fabricated component. ‘‘Fabricated component’’ means a manufactured ar- ticle ready for assembly in the condi- tion as exported except for operations incidental to the assembly.

(e) Product of the United States. A ‘‘product of the United States’’ is an article manufactured within the Cus- toms territory of the United States and may consist wholly of United States components or materials, of United States and foreign components or ma- terials, or wholly of foreign compo- nents or materials. If the article con- sists wholly or partially of foreign components or materials, the manufac- turing process must be such that the foreign components or materials have been substantially transformed into a new and different article, or have been merged into a new and different arti- cle.

[T.D. 75–230, 40 FR 43021, Sept. 18, 1975, as amended by T.D. 89–1, 53 FR 51247, Dec. 21, 1988]

§ 10.13 Statutory provision: Sub- heading 9802.00.80, Harmonized Tariff Schedule of the United States (19 U.S.C. 1202).

Subheading 9802.00.80, Harmonized Tariff Schedule of the United States (HTSUS), (19 U.S.C. 1202), provides that articles assembled abroad in whole or in part of fabricated components, the product of the United States, which (a) were exported in condition ready for assembly without further fabrication, (b) have not lost their physical identity

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00113 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

104

19 CFR Ch. I (4–1–12 Edition)§ 10.14

in such articles by change in form, shape, or otherwise, and (c) have not been advanced in value or improved in condition abroad except by being as- sembled and except by operations inci- dental to the assembly process such as cleaning, lubricating, and painting, are subject to a duty upon the full value of the imported article, less the cost or, if no charge is made, the value of such products of the United States. The rate of duty which is assessed upon the du- tiable portion of the imported article is that which is applicable to the im- ported article as a whole under the ap- propriate provision of the HTSUS (19 U.S.C. 1202) for such article. If that provision requires a specific or com- pound rate of duty, the total duties as- sessed on the imported article are re- duced in such proportion as the cost or value of the returned United States components which qualify for the ex- emption bears to the full value of the assembled article.

Example 1. A transistor radio is assembled abroad from foreign-made components and American-made transistors. Upon importa- tion, the transistor radio is subject to the ad valorem rate of duty applicable to transistor radios upon the value of the radio less the cost or value of the American-made transis- tors assembled therein.

Example 2. A solid-state watch movement is assembled abroad from foreign-made com- ponents and an American-made integrated circuit. If the movement in question is sub- ject to the specific rate of duty of 75 cents if the value of the assembled movement is $30, and if the value of the American-made inte- grated circuit is $10, then the value of the in- tegrated circuit represents one third of the total value of the assembled article and the duty on the assembled article will be reduced by one third ($.25). Therefore, the duty on the assembled movement is 50 cents.

[T.D. 75–230, 40 FR 43021, Sept. 18, 1975, as amended by T.D. 89–1, 53 FR 51247, Dec. 21, 1988]

§ 10.14 Fabricated components subject to the exemption.

(a) Fabricated components, the product of the United States. Except as provided in § 10.15, the exemption provided under subheading 9802.00.80, Harmonized Tar- iff Schedule of the United States (HTSUS) (19 U.S.C. 1202), applies to fab- ricated components, the product of the United States. The components must be in condition ready for assembly

without further fabrication at the time of their exportation from the United States to qualify for the exemption. Components will not lose their entitle- ment to the exemption by being sub- jected to operations incidental to the assembly either before, during, or after their assembly with other components. Materials undefined in final dimen- sions and shapes, which are cut into specific shapes or patterns abroad are not considered fabricated components.

Example 1. Articles identifiable in their ex- ported condition as components or parts of the article into which they will be assem- bled, such as transistors, diodes, integrated circuits, machinery parts, or precut parts of wearing apparel, are regarded as fabricated components.

Example 2. Prestamped metal lead frames for semiconductor devices exported in mul- tiple unit strips in which the individual frame units are connected to each other, or integrated circuit wafers containing indi- vidual integrated circuit dice which have been scribed or scored in the United States, are regarded as fabricated components. The separation of the individual frames by cut- ting, or the segmentation of the wafer into individual dice by flexing and breaking along scribed or scored lines, is regarded as an op- eration incidental to the assembly process.

Example 3. Wires of various type, electrical conductors, metal foils, insulating tapes, rib- bons, findings used in dressmaking, and simi- lar products, which are in a finished state when exported from the United States, and are ready for use in the assembly of the im- ported article, are regarded as fabricated components if they are only cut to length or subjected to operations incidental to the as- sembly process while abroad.

Example 4. Uncut textile fabrics exported in bolts from which wearing apparel compo- nents will be cut according to a pattern are not regarded as fabricated components. Similarly, other materials, such as lumber, leather, sheet metal, plastic sheeting, ex- ported in basic shapes and forms to be fab- ricated into components for assembly, are not eligible for treatment as fabricated com- ponents.

(b) Substantial transformation of for- eign-made articles or materials. Foreign- made articles or materials may become products of the United States if they undergo a process of manufacture in the United States which results in their substantial transformation. Sub- stantial transformation occurs when, as a result of manufacturing processes, a new and different article emerges, having a distinctive name, character,

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00114 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

105

U.S. Customs and Border Protection, DHS; Treasury § 10.16

or use, which is different from that originally possessed by the article or material before being subject to the manufacturing process. The mere fin- ishing or modification of a partially or nearly complete foreign product in the United States will not result in the substantial transformation of such product and it remains the product of a foreign country.

Example 1. A cast metal housing for a valve is made in the United States from imported copper ingots, the product of a foreign coun- try. The housing is a product of the United States because the manufacturing operations performed in the United States to produce the housing resulted in a substantial trans- formation of the foreign copper ingots.

Example 2. An integrated circuit device is assembled in a foreign country and imported into the United States where its leads are formed by bending them to a specified angle. It is then tested and marked. The imported article does not become a product of the United States because the operations per- formed in the United States do not result in a substantial transformation of the foreign integrated circuit device.

Example 3. A circuit board assembly for a computer is assembled in the United States by soldering American-made and foreign- made components onto an American-made printed circuit board. The finished circuit board assembly has a distinct electronic function and is ready for incorporation into the computer. The foreign-made components have undergone a substantial transformation by becoming permanent parts of the circuit board assembly. The circuit board assembly, including all of its parts is regarded as a fab- ricated component, the product of the United States, for purposes of subheading 9802.00.80, HTSUS (19 U.S.C. 1202).

[T.D. 75–230, 40 FR 43022, Sept. 18, 1975, as amended by T.D. 89–1, 53 FR 51247, Dec. 21, 1988]

§ 10.15 Fabricated components not subject to the exemption.

Fabricated components which are not products of the United States are ex- cluded from the exemption. In addi- tion, the exemption is not applicable to any component exported from the Cus- toms territory of the United States:

(a) From continuous Customs cus- tody with remission, abatement, or re- fund of duty;

(b) With benefit of drawback; (c) To comply with any law of the

United States or regulation of any Fed- eral agency requiring exportation; or

(d) After manufacture or production in the United States under subheading 9813.00.05, HTSUS (19 U.S.C. 1202).

Example. Partially completed components of an electric motor are imported in several separate shipments and are entered under a temporary importation bond to be manufac- tured into finished motors under the provi- sions of subheading 9813.00.05, HTSUS (19 U.S.C. 1202). The components are completed and assembled into finished electric motors. The finished motors are exported and are as- sembled abroad into electric fans which are subsequently imported into the United States. Irrespective of the fact that the as- sembly of the motors might involve such a substantial change that the motor could be considered a product of the United States, no exemption may be given for the value of the electric motors, since they were exported after manufacture or production in the United States under the provision of sub- heading 9813.00.05, HTSUS (19 U.S.C. 1202).

[T.D. 75–230, 40 FR 43023, Sept. 18, 1975, as amended by T.D. 89–1, 53 FR 51247, Dec. 21, 1988]

§ 10.16 Assembly abroad.

(a) Assembly operations. The assembly operations performed abroad may con- sist of any method used to join or fit together solid components, such as welding, soldering, riveting, force fit- ting, gluing, laminating, sewing, or the use of fasteners, and may be preceded, accompanied, or followed by operations incidental to the assembly as illus- trated in paragraph (b) of this section. The mixing or combining of liquids, gases, chemicals, food ingredients, and amorphous solids with each other or with solid components is not regarded as an assembly.

Example 1. A television yoke is assembled abroad from American-made magnet wire. In the foreign assembly plant the wire is despooled and wound into a coil, the wire cut from the spool, and the coil united with other components, including a terminal panel and housing which are also American- made. The completed article upon importa- tion would be subject to the ad valorem rate of duty applicable to television parts upon the value of the yoke less the cost or value of the American-made wire, terminal panel and housing, assembled therein. The winding and cutting of the wire are either assembly steps or steps incidental to assembly.

Example 2. An aluminum electrolytic ca- pacitor is assembled abroad from American- made aluminum foil, paper, tape, and Mylar

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00115 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

106

19 CFR Ch. I (4–1–12 Edition)§ 10.16

film. In the foreign assembly plant the alu- minum foil is trimmed to the desired width, cut to the desired length, interleaved with paper, which may or may not be cut to length or despooled from a continuous length, and rolled into a cylinder wherein the foil and paper are cut and a section of sealing tape fastened to the surface to pre- vent these components from unwinding. Wire or other electric connectors are bonded at appropriate intervals to the aluminum foil of the cylinder which is then inserted into a metal can, and the ends closed with a protec- tive washer. As imported, the capacitor is subject to the ad valorem rate of duty appli- cable to capacitors upon the value less the cost or value of the American-made foil, paper, tape, and Mylar film. The operations performed on these components are all ei- ther assembly steps or steps incidental to as- sembly.

Example 3. The manufacture abroad of cloth on a loom using thread or yarn ex- ported from the United States on spools, cops, or pirns is not considered an assembly but a weaving operation, and the thread or yarn does not qualify for the exemption. However, American-made thread used to sew buttons or garment components is qualified for the exemption because it is used in an op- eration involving the assembly of solid com- ponents.

(b) Operations incidental to the assem- bly process. Operations incidental to the assembly process whether performed before, during, or after assembly, do not constitute further fabrication, and will not preclude the application of the exemption. The following are examples of operations which are incidental to the assembly process:

(1) Cleaning; (2) Removal of rust, grease, paint, or

other preservative coating; (3) Application of paint or preserva-

tive coating, including preservative metallic coating, lubricants, or protec- tive encapsulation;

(4) Trimming, filing, or cutting off of small amounts of excess materials;

(5) Adjustments in the shape or form of a component to the extent required by the assembly being performed abroad;

(6) Cutting to length of wire, thread, tape, foil, and similar products ex- ported in continuous length; separation by cutting of finished components, such as prestamped integrated circuit lead frames exported in multiple unit strips; and

(7) Final calibration, testing, mark- ing, sorting, pressing, and folding of as- sembled articles.

(c) Operations not incidental to the as- sembly process. Any significant process, operation, or treatment other than as- sembly whose primary purpose is the fabrication, completion, physical or chemical improvement of a component, or which is not related to the assembly process, whether or not it effects a sub- stantial transformation of the article, will not be regarded as incidental to the assembly and will preclude the ap- plication of the exemption to such arti- cle. The following are examples of op- erations not considered incidental to the assembly as provided under sub- heading 9802.00.80, Harmonized Tariff Schedule of the United States (19 U.S.C. 1202):

(1) Melting of exported ingots and pouring of the metal into molds to produce cast metal parts;

(2) Cutting of garment parts accord- ing to pattern from exported material;

(3) Chemical treatment of compo- nents or assembled articles to impart new characteristics, such as showerproofing, permapressing, sanforizing, dying or bleaching of tex- tiles;

(4) Machining, polishing, burnishing, peening, plating (other than plating in- cidental to the assembly), embossing, pressing, stamping, extruding, drawing, annealing, tempering, case hardening, and any other operation, treatment or process which imparts significant new characteristics or qualities to the arti- cle affected.

(d) Joining of American-made and for- eign-made components. An assembly op- eration may involve the use of Amer- ican-made components and foreign- made components. The various require- ments for establishing entitlement to the exemption apply only to the Amer- ican-made components of the assem- bly.

Example. Diodes are assembled abroad from American-made components. The process in- cludes the encapsulation of the assembled components in a plastic shell. The plastic used for the encapsulation is in the form of a pellet, and is of foreign origin. After the prefabricated diode components are assem- bled, the assembled unit is placed in a trans- fer molding machine, where, by use of the pellet, molten epoxy is caused to flow around

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00116 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

107

U.S. Customs and Border Protection, DHS; Treasury § 10.21

the perimeters of the assembled components, forming upon solidification a plastic body for the diode. Upon importation, exemption may be granted for the value of the Amer- ican-made components, but not for the value of the plastic pellet. If the plastic pellet used for encapsulation was of United States ori- gin, its value would still be a part of the du- tiable value of the diode, because the plastic pellet is not a fabricated component of a type designed to be fitted together by assem- bly, but merely a premeasured quantity of material which was applied to the assembled unit by a process not constituting an assem- bly.

(e) Subassembly. An assembly oper- ation may involve the joining or fitting of American-made components into a part or subassembly of an article, fol- lowed by the installation of the part or subassembly into the complete article.

Example. Rolls of foil and rolls of paper are exported and cut to specific length abroad and interleaved and rolled to form the elec- trodes and dielectric of a capacitor. Fol- lowing this procedure, the rolls are assem- bled with cans and other parts to form a complete capacitor. The foil and paper are entitled to the exemption.

(f) Packing. The packing abroad of merchandise into containers does not in itself qualify either the containers or their contents for the exemption. However, assembled articles which oth- erwise qualify for the exemption and which are packaged abroad following their assembly will not be disqualified from the exemption by reason of their having been so packaged, whether for retail sale or for bulk shipment. The tariff status of the packing materials or containers will be determined in ac- cordance with General Rule of Inter- pretation 5, HTSUS (19 U.S.C. 1202).

[T.D. 75–230, 40 FR 43023, Sept. 18, 1975, as amended by T.D. 89–1, 53 FR 51248, Dec. 21, 1988; CBP Dec. 08-21, 73 FR 33300, June 12, 2008]

§ 10.17 Valuation of exempted compo- nents.

The value of fabricated components to be subtracted from the full value of the assembled article is the cost of the components when last purchased, f.o.b. United States port of exportation or point of border crossing as set out in the invoice and entry papers, or, if no purchase was made, the value of the components at the time of their ship-

ment for exportation, f.o.b. United States port of exportation or point of border crossing, as set out in the in- voice and entry papers. However, if the appraising officer concludes that the cost or value of the fabricated compo- nents so ascertained does not represent a reasonable cost or value, then the value of the components shall be deter- mined in accordance with section 402 or section 402a, Tariff Act of 1930, as amended (19 U.S.C. 1401a, 1402).

[T.D. 75–230, 40 FR 43024, Sept. 18, 1975]

§ 10.18 Valuation of assembled articles.

As in the case of the appraisement of any other import merchandise (see sub- part C of part 152 of this chapter), the full value of assembled articles im- ported under subheading 9802.00.80, Har- monized Tariff Schedule of the United States (HTSUS) (19 U.S.C. 1202), is de- termined in accordance with 19 CFR 152.100 et seq.

[T.D. 87–89, 52 FR 24445, July 1, 1987, as amended by T.D. 89–1, 53 FR 51248, Dec. 21, 1988]

§§ 10.19–10.20 [Reserved]

§ 10.21 Updating cost data and other information.

When a claim for the exemption is predicated on estimated cost data fur- nished either in advance of or at the time of entry, this fact should be clear- ly stated in writing at the time of entry, and suspension of liquidation may be requested by the importer or his agent pending the furnishing of ac- tual cost data. Actual cost data must be submitted as soon as accounting procedures permit. To insure that in- formation used for Customs purposes is reasonably current, the importer shall ordinarily be required to furnish up- dated cost and assembly data at least every six months, regardless of wheth- er he considers that significant changes have occurred. The 6-month period for the submission of updated cost or other data may be extended by the port director if such extension is appropriate for the type of merchan- dise involved, or because of the ac- counting period normally used in the

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00117 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

108

19 CFR Ch. I (4–1–12 Edition)§ 10.23

trade, or because of other relevant cir- cumstances.

[T.D. 75–230, 40 FR 43025, Sept. 18, 1975]

§ 10.23 Standards, quotas, and visas.

All requirements and restrictions ap- plicable to imported merchandise, such as labeling, radiation standards, flame- retarding properties, quotas, and visas, apply to assembled articles eligible for the exemption in the same manner as they would apply to all other imported merchandise.

[T.D. 75–230, 40 FR 43025, Sept. 18, 1975]

§ 10.24 Documentation. (a) Documents required. The following

documents shall be filed in connection with the entry of assembled articles claimed to be subject to the exemption under subheading 9802.00.80, Har- monized Tariff Schedule of the United States (HTSUS) (19 U.S.C. 1202).

(1) Declaration by the assembler. A dec- laration by the person who performed the assembly operations abroad shall be filed in substantially the following form:

I, lllll, declare that to the best of my knowledge and belief the lllll were as- sembled in whole or in part from fabricated components listed and described below, which are products of the United States:

Marks of identifica- tion, numbers

Description of com- ponent Quantity

Unit value at time and place of export

from United States 1

Port and date of export from United

States

Name and address of manufacturer

1 In accordance with U.S. Note 4 to Subchapter II of Chapter 98, Harmonized Tariff Schedule of the United States (19 U.S.C. 1202).

Description of the operations performed abroad on the exported components (in sufficient detail to enable Customs officers to determine whether the operations performed are within the preview of subheading 9802.00.80, Harmonized Tariff Schedule of the United States (19 U.S.C. 1202) (attach supplemental sheet if more space is required)):

llllllllllllllllllllllll

Date Signature llllllllllllllllllllllll

Address Capacity

(2) Endorsement by the importer. An en- dorsement, in substantially the fol- lowing form, shall be signed by the im- porter:

I declare that to the best of my knowledge and belief the (above), (attached) declara- tion, and any other information submitted herewith, or otherwise supplied or referred to, is correct in every respect and there has been compliance with all pertinent legal notes to the Harmonized Tariff Schedule of the United States (19 U.S.C. 1202). llllllllllllllllllllllll

Date Signature

llllllllllllllllllllllll

Address Capacity

(b) Revision of format. In specific cases, the port director may revise the format of either of the documents spec- ified in paragraph (a) of this section and may make such changes as condi- tions warrant, provided the data and information required to be supplied in these documents are presented. For ex-

ample, if the components were fur- nished by the importer, the informa- tion on components may be supplied as part of the importer’s endorsement, rather than as part of the assembler’s declaration.

(c) Reference to previously filed docu- ments. In lieu of filing duplicate lists of components and descriptions of assem- bly operations with each entry, the documents specified in paragraph (a) of this section may refer to assembly de- scriptions and lists of components pre- viously filed with and approved by the port director, or to records showing costs, names of manufacturers, and other necessary data on components, provided the importer has arranged with the port director to maintain such records and keep them available for ex- amination by authorized Customs offi- cers.

(d) Waiver of specific details for each entry. There are cases where large quantities of United States compo- nents are purchased from various sources or exported at various ports and dates on a continuing basis, so that

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00118 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

109

U.S. Customs and Border Protection, DHS; Treasury § 10.26

it is impractical to identify the exact source, port and date of export for each particular component included in an entry of merchandise claimed to be subject to the exemption under sub- heading 9802.00.80, HTSUS (19 U.S.C. 1202). In these cases, specific details such as the port and date of export and the name of the manufacturer of the United States components may be waived if the port director is satisfied that the importer and assembler have established reliable controls to insure that all components for which the ex- emption is claimed are in fact products of the United States. These controls shall include strict physical segrega- tion of United States and foreign com- ponents, as well as records of United States components showing quantities, sources, costs, dates shipped abroad, and other necessary information. These records shall be maintained by the im- porter and assembler for 5 years from the date of the released entry in a man- ner so that they are readily available for audit, inspection, copying, repro- duction or other official use by author- ized Customs officers.

(e) Waiver of documents. When the port director is satisfied that unusual circumstances make the production of either or both of the documents speci- fied in paragraph (a) of this section, or of any of the information set forth therein, impractical and is further sat- isfied that the requirements of sub- heading 9802.00.80, HTSUS, and related legal notes have been met, he may waive the production of such docu- ment(s) or information.

(f) Unavailability of documents at time of entry. If either or both of the docu- ments specified in paragraph (a) of this section are not available at the time of entry, a bond on Customs Form 301 containing the bond conditions set forth in § 113.62 of this chapter for the production of the document(s) may be given pursuant to §§ 113.41–113.46 and 141.66 of this chapter.

(g) Responsibility of correctness. Sub- ject to the civil and criminal sanctions provided by law for false or fraudulent entries, the importer has the ultimate responsibility for supplying all infor- mation needed by the Customs Service to process an entry, and for the com- pleteness and truthfulness of such in-

formation. If certain information can- not be supplied by the assembler, it must be provided by the importer.

[T.D. 75–230, 40 FR 43025, Sept. 18, 1975, as amended by T.D. 79–159, 44 FR 31967, June 4, 1979; T.D. 84–213, 49 FR 41165, Oct. 19, 1984; T.D. 89–1, 53 FR 51248, Dec. 21, 1988]

§ 10.25 Textile components cut to shape in the United States and as- sembled abroad.

Where a textile component is cut to shape (but not to length, width, or both) in the United States from foreign fabric and exported to another country, territory, or insular possession for as- sembly into an article that is then re- turned to the United States and en- tered, or withdrawn from warehouse, for consumption on or after July 1, 1996, the value of the textile component shall not be included in the dutiable value of the article. For purposes of de- termining whether a reduction in the dutiable value of an imported article may be allowed under this section:

(a) The terms ‘‘textile component’’ and ‘‘fabric’’ have reference only to goods covered by the definition of ‘‘textile or apparel product’’ set forth in § 102.21(b)(5) of this chapter;

(b) The operations performed abroad on the textile component shall conform to the requirements and examples set forth in § 10.16 insofar as they may be applicable to a textile component; and

(c) The valuation and documentation provisions of §§ 10.17, 10.18, 10.21 and 10.24 shall apply.

[T.D. 95–69, 60 FR 46196, Sept. 5, 1995; T.D. 95– 69, 60 FR 55995, Nov. 6, 1995]

§ 10.26 Articles assembled or processed in a beneficiary country in whole of U.S. components or ingredients; ar- ticles assembled in a beneficiary country from textile components cut to shape in the United States.

(a) No article (except a textile arti- cle, apparel article, or petroleum, or any product derived from petroleum, provided for in heading 2709 or 2710, Harmonized Tariff Schedule of the United States (HTSUS)) shall be treat- ed as a foreign article or as subject to duty:

(1) If the article is assembled or proc- essed in a beneficiary country in whole

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00119 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

110

19 CFR Ch. I (4–1–12 Edition)§ 10.30c

of fabricated components that are a product of the United States; or

(2) If the article is processed in a ben- eficiary country in whole of ingredi- ents (other than water) that are a prod- uct of the United States; and

(3) Neither the fabricated compo- nents, materials or ingredients after their exportation from the United States, nor the article before its impor- tation into the United States, enters into the commerce of any foreign coun- try other than a beneficiary country.

(b) No article (except a textile or ap- parel product) entered, or withdrawn from warehouse, for consumption on or after July 1, 1996, shall be treated as a foreign article or as subject to duty:

(1) If the article is assembled in a beneficiary country in whole of textile components cut to shape (but not to length, width, or both) in the United States from foreign fabric; or

(2) If the article is assembled in a beneficiary country in whole of both textile components described in para- graph (b)(1) of this section and compo- nents that are products of the United States; and

(3) Neither the components after their exportation from the United States, nor the article before its impor- tation into the United States, enters into the commerce of any foreign coun- try other than a beneficiary country.

(c) For purposes of this section: (1) The terms ‘‘textile article’’, ‘‘ap-

parel article’’, and ‘‘textile or apparel product’’ cover all articles, other than footwear and parts of footwear, that are classifiable in an HTSUS sub- heading which carries a textile and ap- parel category number designation;

(2) The term ‘‘beneficiary country’’ has the meaning set forth in § 10.191(b)(1); and

(3) A component, material, ingre- dient, or article shall be deemed to have not entered into the commerce of any foreign country other than a bene- ficiary country if:

(i) The component, material, or in- gredient was shipped directly from the United States to a beneficiary country, or the article was shipped directly to the United States from a beneficiary country, without passing through the territory of any non-beneficiary coun- try; or

(ii) Where the component, material, ingredient, or article passed through the territory of a non-beneficiary coun- try while en route to a beneficiary country or the United States:

(A) The invoices, bills of lading, and other shipping documents pertaining to the component, material, ingredient, or article show a beneficiary country or the United States as the final des- tination and the component, material, ingredient, or article was neither sold at wholesale or retail nor subjected to any processing or other operation in the non-beneficiary country; or

(B) The component, material, ingre- dient, or article remained under the control of the customs authority of the non-beneficiary country and was not subjected to operations in that non- beneficiary country other than loading and unloading and activities necessary to preserve the component, material, ingredient, or article in good condition.

[T.D. 95–69, 60 FR 46197, Sept. 5, 1995]

FREE ENTRY—ARTICLES FOR THE USE OF FOREIGN MILITARY PERSONNEL

§ 10.30c [Reserved]

TEMPORARY IMPORTATIONS UNDER BOND

§ 10.31 Entry; bond.

(a)(1) Entry of articles brought into the United States temporarily and claimed to be exempt from duty under Chapter 98, Subchapter XIII, Har- monized Tariff Schedule of the United States (HTSUS), unless covered by an A.T.A. carnet or a TECRO/AIT carnet as provided in part 114 of this chapter, shall be made on Customs Form 3461 or 7533, supported by the documentation required by § 142.3 of this chapter. How- ever, when § 10.36 or § 10.36a is applica- ble, or the aggregate value of the arti- cle is not over $250, the form prescribed for the informal entry of importations by mail, in baggage, or by other means, may be used. When entry is made on Customs Form 3461 or 7533, an entry summary, Customs Form 7501, shall be filed within 10 days after time of entry, in accordance with subpart B, part 142 of this chapter.

(2) If Customs Form 7501 is filed at time of entry, it shall serve as both the

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00120 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

111

U.S. Customs and Border Protection, DHS; Treasury § 10.31

entry and entry summary, and Cus- toms Form 3461 or 7533 shall not be re- quired. Customs Form 7501 shall be in original only, except for entries under subheading 9813.00.05, HTSUS, which require a duplicate copy for statistical purposes. When articles are entered under an A.T.A. carnet or a TECRO/ AIT carnet, the importation voucher of the carnet shall serve as the entry.

(3) In addition to the data usually shown on a regular consumption entry summary, each temporary importation bond entry summary shall include:

(i) The HTSUS subheading number under which entry is claimed.

(ii) A statement of the use to be made of the articles in sufficient detail to enable the port director to deter- mine whether they are entitled to entry as claimed, and

(iii) A declaration that the articles are not to be put to any other use and that they are not imported for sale or sale on approval.

(b) The port director, if he is satisfied as to the importer’s identity and good faith, may admit a vehicle or craft brought in by a nonresident to take part in a race or other specific contest for which no money purse is awarded, under the provisions of subheading 9813.00.35, HTSUS, without formal entry or security for exportation. If at the time of arrival it appears that the article is likely to remain in the United States beyond 90 days, formal entry and bond shall be taken.

(c) When any article has been admit- ted without formal entry or security for exportation and the importer there- after desires to prolong his stay beyond 90 days, an entry covering the article and security for its exportation shall be accepted at any port where the arti- cle may be presented for entry. The time during which the imported article may remain in the United States under the entry shall be computed from the date of its original arrival in the United States. The estimated duties for the purpose of fixing the amount of any bond required by paragraph (f) of this section shall be the estimated duties which would have been required to be deposited had the article been entered under an ordinary consumption entry on the date of the original arrival.

(d) [Reserved]

(e) The entry or invoice shall: (1) De- scribe each article in detail; (2) set forth the value of each article; and (3) set forth any marks or numbers there- on or other distinguishing features thereof. In the case of a vehicle, air- craft, or pleasure boat entered under subheading 9813.00.05, HTSUS and § 10.36a, the registration number, and engine or motor number, and the body number (if available) shall also be shown on the entry. Examination of the imported articles shall be made whenever the circumstances warrant, and occasionally in any event to an ex- tent which will enable the Customs of- ficer to determine that the importation is in agreement with the invoice or entry as to identity and quantity and for the purpose of accepting the entry under the applicable provisions of Chapter 98, Subchapter XIII, HTSUS. No examination for the purpose of ap- praisement and no appraisement of the articles shall be made.

(f) With the exceptions stated herein, a bond shall be given on Customs Form 301, containing the bond conditions set forth in § 113.62 of this chapter, in an amount equal to double the duties, in- cluding fees, which it is estimated would accrue (or such larger amount as the port director shall state in writing or by the electronic equivalent to the entrant is necessary to protect the rev- enue) had all the articles covered by the entry been entered under an ordi- nary consumption entry. In the case of samples solely for use in taking orders entered under subheading 9813.00.20, HTSUS, motion-picture advertising films entered under subheading 9813.00.25, HTSUS, and professional equipment, tools of trade and repair components for such equipment or tools entered under subheading 9813.00.50, HTSUS, the bond required to be given shall be in an amount equal to 110 percent of the estimated duties, in- cluding fees, determined at the time of entry. If appropriate a carnet, under the provisions of part 114 of this chap- ter, may be filed in lieu of a bond on Customs Form 301 (containing the bond conditions set forth in § 113.62 of this chapter). Cash deposits in the amount of the bond may be accepted in lieu of sureties. When the articles are entered under subheading 9813.00.05, 9813.00.20,

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00121 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

112

19 CFR Ch. I (4–1–12 Edition)§ 10.33

or 9813.00.50, HTSUS without formal entry, as provided for in §§ 10.36 and 10.36a, or the amount of the bond taken under any subheading of Chapter 98, Subchapter XIII, HTSUS, is less than $25, the bond shall be without surety or cash deposit, and the bond shall be modified to so indicate. In addition, notwithstanding any other provision of this paragraph, in the case of profes- sional equipment necessary for car- rying out the business activity, trade or profession of a business person, equipment for the press or for sound or television broadcasting, cinemato- graphic equipment, articles imported for sports purposes and articles in- tended for display or demonstration, if brought into the United States by a resident of Canada, Mexico, Singapore, Chile, Morocco, El Salvador, Guate- mala, Honduras, Nicaragua, the Do- minican Republic, Costa Rica, Bahrain, Oman, Peru, or the Republic of Korea and entered under Chapter 98, Sub- chapter XIII, HTSUS, no bond or other security will be required if the entered article is a good originating, within the meaning of General Note 12, 25, 26, 27, 29, 30, 31, 32, and 33, HTSUS, in the country of which the importer is a resi- dent.

(g) Claim for free entry under Chap- ter 98, Subchapter XIII, HTSUS may be made for articles of any character de- scribed therein which have been pre- viously entered under any other provi- sion of law and the entry amended ac- cordingly upon compliance with the re- quirements of this section, provided the articles have not been released from CBP custody, or even though re- leased from CBP custody if it is estab- lished that the original entry was made on the basis of a clerical error, mistake of fact, or other inadvertence within the meaning of section 514(a), Tariff Act of 1930, as amended, and was brought to the attention of CBP within the time limits of that section. If an entry is so amended, the period of time during which the merchandise may re- main in the customs territory of the United States under bond shall be com- puted from the date of importation. In the case of articles covered by an infor- mal mail entry, such a claim may be made within a reasonable time either

before or after the articles have been released from CBP custody.

(h) After the entry and bond have been accepted, the articles may be re- leased to the importer. The entry shall not be liquidated as the transaction does not involve liquidated duties. However, a TIB importer may be re- quired to file an entry for consumption and pay duties, or pay liquidated dam- ages under its bond for a failure to do so, in the case of merchandise imported under subheading 9813.00.05, HTSUS, and subsequently exported to Canada or Mexico (see § 181.53 of this chapter).

[28 FR 14663, Dec. 31, 1963]

EDITORIAL NOTE: For FEDERAL REGISTER ci- tations affecting § 10.31, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at www.fdsys.gov.

§ 10.33 Theatrical effects.

For purposes of the entry of theat- rical scenery, properties and apparel under subheading 9817.00.98, Har- monized Tariff Schedule of the United States:

(a) Animals imported for use or exhi- bition in theaters or menageries may be classified as theatrical properties; and

(b) The term ‘‘theatrical scenery, properties and apparel’’ shall not be construed to include motion-picture films.

For provisions relating to the return without formal entry of theatrical ef- fects taken from the United States, see § 10.68 of this part.

[T.D. 92–85, 57 FR 40605, Sept. 4, 1992, as amended by CBP Dec. 04–28, 69 FR 52599, Aug. 27, 2004]

§ 10.35 Models of women’s wearing ap- parel.

(a) Models of women’s wearing ap- parel admitted under subheading 9813.00.10, Harmonized Tariff Schedule of the United States (HTSUS), shall not be removed from the importer’s es- tablishment for reproducing, copying, painting, sketching, or for any other use by others, nor be used in the im- porter’s establishment for such pur- poses except by the importer or his em- ployees.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00122 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

113

U.S. Customs and Border Protection, DHS; Treasury § 10.36

(b) Invoices covering models of wom- en’s wearing apparel entered under sub- heading 9813.00.10 or 9813.00.25, HTSUS shall state the kind and color of the principal material from which the ap- parel is made, and shall contain a de- scription of the lining and the trim- ming, stating whether composed of fur, lace, embroidery, or other material. In- voices shall also contain a statement as to how the trimming is applied, that is, whether on the cuffs, collar, sleeves, or elsewhere, and the total value of each completed garment or article.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 87–75, 52 FR 20066, May 29, 1987; T.D. 89– 1, 53 FR 51248, Dec. 21, 1988]

§ 10.36 Commercial travelers’ samples; professional equipment and tools of trade; theatrical effects and other articles.

(a) Samples accompanying a com- mercial traveler who presents an ade- quate descriptive list or a special CBP invoice, and professional equipment, tools of trade, and repair components for such equipment or tools imported in his baggage for his own use by a nonresident sojourning temporarily in the United States may be entered on the importer’s baggage declaration in lieu of formal entry and examination and may be passed under subheadings 9813.00.20 or 9813.00.50, Harmonized Tar- iff Schedule of the United States, (HTSUS), at the place of arrival in the same manner as other passengers’ bag- gage. The examination may be made by an inspector who is qualified, in the opinion of the port director, to deter- mine the amount of the bond required by § 10.31(c) to be filed in support of the entry. If the articles are a commercial traveler’s samples and exceed $500 in value, a special Customs invoice or a descriptive list shall be furnished.

(b) When the proprietor or manager of a theatrical exhibition arriving from abroad who has entered his scenery, properties, and apparel under sub- heading 9817.00.98, HTSUS, con- templates side trips to a contiguous country with the exhibition within the period of time during which the mer- chandise may remain in the customs territory of the United States under bond, including any lawful extension, a copy of the entry covering the effects

and a copy of a descriptive list of such effects or invoice furnished by him may be certified by the examining offi- cer and returned to the proprietor or manager for use in registering the ef- fects with the CBP officers at the port of exit, and in clearing them through CBP on his return. Cancellation of the bond shall be effected by exportation in accordance with the provisions of § 10.38 at the time the theatrical effects are finally taken out of the United States before the expiration of the pe- riod of time during which the merchan- dise may remain in the customs terri- tory of the United States under bond, including any lawful extension. Simi- lar treatment may be accorded articles entered under other subheadings in chapter 98, subchapter XIII, HTSUS, upon approval by Headquarters, U.S. Customs and Border Protection.

(c) When a commercial traveler con- templates side trips to a contiguous country within the period of time dur- ing which the merchandise may remain in the customs territory of the United States under bond, including any law- ful extension, a copy of his baggage declaration and a copy of the descrip- tive list or special CBP invoice fur- nished by him may be certified by the examining officer and returned to the traveler for use in registering the sam- ples with CBP officers at the port of exit, and in clearing them through CBP upon his return. Cancellation of the bond shall be effected by exportation in accordance with the provisions of § 10.38 at the time the samples are fi- nally taken out of the United States before the expiration of the period of time during which the merchandise may remain in the customs territory of the United States under bond, includ- ing any lawful extension.

(d) The privilege of clearance of com- mercial travelers’ samples or profes- sional equipment, tools of trade, and repair components for such equipment or tools imported for his own use by a nonresident sojourning temporarily in the United States on a baggage dec- laration under bond without surety or cash deposit shall not be accorded to a commercial traveler or such non- resident who, through fraud or culpable negligence, has failed to comply with

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00123 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

114

19 CFR Ch. I (4–1–12 Edition)§ 10.36a

the provisions of such a bond in con- nection with a prior arrival. Such a commercial traveler or non- resident shall be required to file a for- mal entry under subheading 9813.00.20 or subheading 9813.00.50, HTSUS with a bond supported by a surety or cash de- posit in lieu of surety.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 69–146, 34 FR 9799, June 25, 1969; T.D. 84– 213, 49 FR 41165, Oct. 19, 1984; T.D. 89–1, 53 FR 51248, Dec. 21, 1988; CBP Dec. 10–29, 75 FR 52450, Aug. 26, 2010]

§ 10.36a Vehicles, pleasure boats and aircraft brought in for repair or al- teration.

(a) A vehicle (such as an automobile, truck, bus, motorcycle, tractor, trail- er), pleasure boat, or aircraft brought into the United States by an operator of such vehicle, pleasure boat, or air- craft for repair or alteration (as de- fined in §§ 10.8, 10.490, 10.570, and 181.64 of this chapter) may be entered on the operator’s baggage declaration, in lieu of formal entry and examination, and may be passed under subheading 9813.00.05, Harmonized Tariff Schedule of the United States (HTSUS), at the place of arrival in the same manner as passengers’ baggage. When the vehicle, aircraft, or pleasure boat to be entered is being towed by or transported on an- other vehicle, the operator of the tow- ing or transporting vehicle may make entry for the vehicle, aircraft or pleas- ure boat to be repaired or altered. The bond, prescribed by § 10.31(f), filed to support entry under this section shall be without surety or cash deposit ex- cept as provided by this paragraph and paragraph (d) of this section. The ex- amination may be made by an inspec- tor who is qualified to determine the amount of such bond to be filed in sup- port of the entry. The privilege ac- corded by this paragraph shall not apply when two or more vehicles, pleasure boats, or aircraft are to be en- tered by the same importer under sub- heading 9813.00.05, HTSUS, at the same time. In that event, the importer must file a formal entry supported by bond with surety or cash deposit in lieu of surety.

(b) Each vehicle, pleasure boat, or aircraft to which paragraph (a) of this section is applicable shall be identified

on the operator’s baggage declaration, which must include the data prescribed in paragraphs (a) and (e) of § 10.31.

(c) Exportation shall be effected in accordance with the provisions of § 10.38.

(d) The privilege of clearance of a ve- hicle, pleasure boat, or aircraft brought in by the operator of such ve- hicle, pleasure boat, or aircraft, for re- pair or alteration on his baggage dec- laration under bond without surety or cash deposit shall not be granted to an individual who has failed to comply with the provisions of such a bond in connection with any prior arrival. Such individual shall be required to file a formal entry under subheading 9813.00.05, HTSUS, with a bond sup- ported by a surety or cash deposit in lieu of surety.

[T.D. 66–39, 31 FR 2817, Feb. 17, 1966, as amended by T.D. 84–213, 49 FR 41165, Oct. 19, 1984; T.D. 89–1, 53 FR 51248, Dec. 21, 1988; T.D. 94–1, 58 FR 69470, Dec. 30, 1993; CBP Dec. 05– 07, 70 FR 10872, Mar. 7, 2005; CBP Dec. 07–28, 72 FR 31995, June 11, 2007]

§ 10.37 Extension of time for expor- tation.

The period of time during which mer- chandise entered under bond under chapter 98, subchapter XIII, Har- monized Tariff Schedule of the United States (19 U.S.C. 1202), may remain in the customs territory of the United States, may be extended for not more than two further periods of 1 year each, or such shorter period as may be appro- priate. Extensions may be granted by the director of the port where the entry was filed upon written applica- tion on CBP Form 3173, provided the articles have not been exported or de- stroyed before the receipt of the appli- cation, and liquidated damages have not been assessed under the bond be- fore receipt of the application. Any un- timely request for an extension of time for exportation shall be referred to the Director, Commercial and Trade Fa- cilitation Division, Office of Inter- national Trade, CBP Headquarters, for disposition. Any request for relief from a liquidated damage assessment in ex- cess of a Fines, Penalties, and Forfeit- ures Officer’s delegated authority shall be referred to the Director, Border Se- curity and Trade Compliance Division,

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00124 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

115

U.S. Customs and Border Protection, DHS; Treasury § 10.39

Office of International Trade, CBP Headquarters, for disposition. No ex- tension of the period for which a carnet is valid shall be granted.

[T.D. 69–146, 34 FR 9799, June 25, 1969, as amended by T.D. 84–213, 49 FR 41165, Oct. 19, 1984; T.D. 89–1, 53 FR 51249, Dec. 21, 1988; T.D. 91–77, 56 FR 46114, Sept. 10, 1991; T.D. 99–27, 64 FR 13675, Mar. 22, 1999]

§ 10.38 Exportation. (a) Articles entered under chapter 98,

subchapter XIII, Harmonized Tariff Schedule of the United States (HTSUS) (19 U.S.C. 1202) may be exported at the port of entry or at another port. An ap- plication on Customs Form 3495 shall be filed in duplicate with the port di- rector a sufficient length of time in ad- vance of exportation to permit the ex- amination and identification of the ar- ticles if circumstances warrant such action and, in such event, the applicant shall be notified on a copy of Customs Form 3495 where the articles are to be sent for identification. If a carnet was used for entry purposes, the reexpor- tation voucher of the carnet shall be filed, in addition to Customs Form 3495, and the carnet shall be presented for certification.

(b) All expenses in connection with the delivery of the articles for exam- ination, the cording and sealing of such articles, and their transfer for expor- tation shall be paid by the parties in interest.

(c) If exportation is to be made at a port other than the one at which the merchandise was entered, the applica- tion on Customs Form 3495 shall be filed in triplicate. There shall also be filed with the application a certified copy of the import entry or a certified copy of the invoice used on entry.

(d) If the goods are examined at one port and are to be exported from an- other port, they shall be forwarded to the port of exportation under a trans- portation and exportation entry. In such cases Customs Form 3495 shall be filed in triplicate. Articles entered under a carnet shall not be examined elsewhere than at the port from which they are to be exported.

(e) If the articles are to be exported by mail or parcel post, the package containing the articles must be mailed under Customs supervision after exam-

ination. Waiver of the right to with- draw the package from the mails shall be endorsed on each package to be so exported and signed by the exporter.

(f) Whenever the circumstances war- rant, and occasionally in any event, port directors shall cause the fact of exportation to be verified by the Office of Enforcement in harmony with the procedures provided for in §§ 18.7 and 191.61 of this chapter.

(g) Upon the presentation of satisfac- tory evidence to the director of the port at which samples were entered under subheading 9813.00.20, HTSUS, or professional equipment or tools of trade were entered under subheading 9813.00.50, HTSUS, that such articles cannot be exported for the reason that they have been seized (other than by seizure at the suit of private persons), the requirement of exportation shall be suspended for the duration of the sei- zure. The articles shall be exported promptly after release from seizure.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 69–146, 34 FR 9799, June 25, 1969; T.D. 83– 212, 48 FR 46771, Oct. 14, 1983; T.D. 84–213, 49 FR 41165, Oct. 19, 1984; T.D. 89–1, 53 FR 51249, Dec. 21, 1988; T.D. 91–77, 56 FR 46114, Sept. 10, 1991; T.D. 98–16, 63 FR 11004, Mar. 5, 1998]

§ 10.39 Cancellation of bond charges. (a) Charges against bonds taken pur-

suant to Chapter 98, Subchapter XIII, Harmonized Tariff Schedule of the United States, (HTSUS), may be can- celed in the manner prescribed in § 113.55 of this chapter. A completed re- exportation counterfoil on a carnet es- tablishes that the articles covered by the carnet have been exported, and no claim shall be brought against the guaranteeing association under the carnet for failure to export, except under the provisions of § 114.26 of this chapter. In the case of articles entered under subheading 9813.00.30, HTSUS, which are destroyed because of their use for the purposes of importation, the bond charge shall not be canceled unless there is submitted to the port director a certificate of the importer that the articles were destroyed during the course of a specifically described use, and the port director is satisfied that the articles were so destroyed as articles of commerce within the period of time during which the articles may

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00125 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

116

19 CFR Ch. I (4–1–12 Edition)§ 10.39

remain in the Customs territory of the United States under bond (including any lawful extension). Bonds covering articles entered under other provisions of law shall not be canceled upon proof of destruction, except as provided for in paragraph (c) of this section, unless the articles are destroyed under Cus- toms supervision in accordance with section 557, Tariff Act of 1930, as amended, and § 158.43 of this chapter.

(b) Where exportation has been made at a port other than the port of entry, the bond may be canceled upon the cer- tificate of lading received from the port of exportation, showing that such exportation was made within the pe- riod of time during which the articles may remain in the Customs territory of the United States under bond. In ad- dition, the port director may require the production of a landing certificate signed by a revenue officer of the coun- try to which the merchandise is ex- ported.

(c) When articles entered temporarily free of duty under bond are destroyed within the bond period by death, acci- dental fire, or other casualty, petition for relief from liability under the bond shall be made to the United States Cus- toms Service. The petition shall be ac- companied by a statement of the im- porter, or other person having knowl- edge of the facts, setting forth the cir- cumstances of the destruction of the articles.

(d)(1) If any article entered under Chapter 98, subchapter XIII, HTSUS, except those entered under a carnet, has not been exported or destroyed in accordance with the regulations in this part within the period of time during which the articles may remain in the Customs territory of the United States under bond (including any lawful ex- tension), the Fines, Penalties, and For- feitures Officer shall make a demand in writing under the bond for the pay- ment of liquidated damages equal to double the estimated duties applicable to such entry, unless a different amount is prescribed by § 10.31(f). The demand shall include a statement that a written petition for relief from the payment of the full liquidated damages may be filed with the Fines, Penalties, and Forfeitures Officer within 60 days after the date of the demand. For pur-

poses of this section, the term esti- mated duties shall include any mer- chandise processing fees applicable to such entry.

(2) If articles entered under a carnet have not been exported or destroyed in accordance with the regulations in this part within the carnet period, the port director shall promptly after expira- tion of that period make demand in writing upon the importer and guaran- teeing association for the payment of liquidated damages in the amount of 110 percent of the estimated duties on the articles not exported or destroyed. The guaranteeing association shall have a period of 6 months from the date of claim in which to furnish proof of the exportation or destruction of the articles under conditions set forth in the Convention or Agreement under which the carnet is issued. If such proof is not furnished within the 6– month period, the guaranteeing asso- ciation shall forthwith pay the liq- uidated damages provided for above. The payment shall be refunded if the guaranteeing association within 3 months from the date of payment fur- nishes the proof referred to above. No claim for payment under a carnet cov- ering a temporary importation may be made against the guaranteeing associa- tion more than 1 year after the expira- tion of the period for which the carnet was valid.

(3) Demand for return to Customs custody. When the demand for return to Customs custody is made in the case of merchandise entered under Chapter 98, subchapter XIII, HTSUS (19 U.S.C. 1202), liquidated damages in an amount equal to double the estimated duties on the merchandise not returned shall be demanded, except that in the case of samples solely for use in taking orders, motion-picture advertising films, pro- fessional equipment, tools of trade, and repair components for professional equipment and tools of trade, the liq- uidated damages demanded shall be in an amount equal to 110 percent of the estimated duties.

(e) If there has been a default with respect to any or all of the articles cov- ered by the bond and a written petition for relief is filed as provided in part 172 of this chapter, it will be reviewed by the Fines, Penalties, and Forfeitures

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00126 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

117

U.S. Customs and Border Protection, DHS; Treasury § 10.39

Officer having jurisdiction in the port where the entry was filed. If the Fines, Penalties, and Forfeitures Officer is satisfied that the importation was properly entered under Chapter 98, sub- chapter XIII, and that there was no in- tent to defraud the revenue or delay the payment of duty, the Fines, Pen- alties, and Forfeitures Officer may can- cel the liability for the payment of liq- uidated damages in any case in his or her delegated authority as follows:

(1) If evidence is furnished which sat- isfies the Fines, Penalties, and Forfeit- ures Officer that the article would have been entitled to free entry as domestic products exported and returned had the evidence been furnished at the time of entry, without the collection of liq- uidated damages.

(2) If the article has been exported or destroyed under Customs supervision but not within the period of time dur- ing which the articles may remain in the Customs territory of the United States under bond, upon the payment of such lesser amount as the port direc- tor may deem appropriate under the law and in view of the circumstances, or without the collection of liquidated damages if the Fines, Penalties, and Forfeitures Officer is satisfied that the delay in exportation or destruction was for the benefit of the United States or was occasioned wholly by cir- cumstances reasonably beyond the con- trol of the parties concerned and which could not have been anticipated by a reasonably prudent person.

(3) If the article was exported or de- stroyed within the period of time dur- ing which the articles may remain in the Customs territory of the United States under bond but not under Cus- toms supervision and satisfactory doc- umentary evidence of actual expor- tation, such as a foreign landing cer- tificate, or of death or other complete destruction, such as a veterinarian’s certificate or certificates of two disin- terested witnesses, are furnished to- gether with a complete explanation by the applicant of the failure to obtain Customs supervision, upon the pay- ment of such lesser amount as the Fines, Penalties, and Forfeitures Offi- cer may deem appropriate under the law and in view of the circumstances, or without the collection of liquidated

damages if the port director is satisfied that the merchandise was destroyed under circumstances which precluded any arrangement to obtain Customs supervision. Satisfactory documentary evidence of exportation, in the case of carnets, would include the particulars regarding importation or reimporta- tion entered in the carnet by the Cus- toms authorities of another con- tracting party, or a certificate with re- spect to importation or reimportation issued by those authorities, based on the particulars shown on a voucher which was detached from the carnet on importation or reimportation into their territory, provided it is shown that the importation or reimportation took place after the exportation which it is intended to establish.

(4) Upon the payment of an amount equal to double the duty which would have accrued on the articles had they been entered under an ordinary con- sumption entry, or equal to 110 percent of such duties where that percentage is prescribed in § 10.31(f), if such amount is determined to be less than the full amount of the bond.

(f) Anticipatory breach. If an importer anticipates that the merchandise en- tered under a Temporary Importation Bond will not be exported or destroyed in accordance with the terms of the bond, the importer may indicate to Customs in writing before the bond pe- riod has expired of the anticipatory breach. At the time of written notifica- tion of the breach, the importer shall pay to Customs the full amount of liq- uidated damages that would be as- sessed at the time of breach of the bond, and the entry will be closed. The importer shall notify the surety in writing of the breach and payment. By this payment, the importer waives his right to receive a notice of claim for liquidated damages as required by § 172.1(a) of this chapter.

(g) If the petitioner is not satisfied with the port director’s action under this section and submits a supple- mental petition, both the original and the supplemental petitions shall be

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00127 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

118

19 CFR Ch. I (4–1–12 Edition)§ 10.40

transmitted to the designated Head- quarters official with a full report on the case.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 69–146, 34 FR 9799, June 25, 1969; T.D. 70– 249, 35 FR 18265, Dec. 1, 1970; T.D. 71–70, 36 FR 4485, Mar. 6, 1971; T.D. 73–308, 38 FR 30549, Nov. 6, 1973; T.D. 74–227, 39 FR 32015, Sept. 4, 1974; T.D. 75–36, 40 FR 5146, Feb. 4, 1975; T.D. 84–213, 49 FR 41165, Oct. 19, 1984; T.D. 89–1, 53 FR 51249, Dec. 21, 1988; T.D. 91–71, 56 FR 40779, Aug. 16, 1991; T.D. 95–22, 60 FR 14632, Mar. 20, 1995; T.D. 98–10, 63 FR 4167, Jan. 28, 1998; T.D. 99–27, 64 FR 13675, Mar. 22, 1999; T.D. 00–57, 65 FR 53574, Sept. 5, 2000]

§ 10.40 Refund of cash deposits.

(a) When a cash deposit is made in lieu of surety, it shall be refunded to the person in whose name the entry is made upon exportation in compliance with § 10.38.

(b) If any article entered under Chap- ter 98, subchapter XIII, Harmonized Tariff Schedule of the United States, is not exported or destroyed within the period of time during which articles may remain in the Customs territory of the United States under bond (in- cluding any lawful extension), the port director shall notify the importer in writing that the entire cash deposit will be transferred to the regular ac- count as liquidated damages unless a written application for relief from the payment of the full liquidated damages is filed with the port director within 60 days after the date of the notice. If such an application is timely filed, the transfer of the cash deposit to the reg- ular account as liquidated damages shall be deferred pending the decision of the Headquarters, U.S. Customs Service or, in appropriate cases, the port director on the application.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 84–213, 49 FR 41165, Oct. 19, 1984; T.D. 89– 1, 53 FR 41249, Dec. 21, 1988]

INTERNATIONAL TRAFFIC

§ 10.41 Instruments; exceptions.

(a) Locomotives and other railroad equipment, trucks, buses, taxicabs, and other vehicles used in international traffic shall be subject to the treat- ment provided for in part 123 of this chapter.

(b) [Reserved]

(c) Foreign-owned aircraft arriving in the United States shall be subject to the treatment provided for in part 122 of this chapter, unless entered under the provisions of §§ 10.31, 10.183, or para- graph (d) of this section.

(d) Any foreign-owned locomotive or other railroad equipment, truck, bus, taxicab, or other vehicle, aircraft, or undocumented boat brought into the United States for the purpose of car- rying merchandise or passengers be- tween points in the United States for hire or as an element of a commercial transaction, except as provided at §§ 123.12 (a) and (b), 123.14(c), and 141.4(b)(4), is subject to treatment as an importation of merchandise from a for- eign country and a regular entry for such vehicle, aircraft or boat will be made. The use of any such vehicle, air- craft, or boat without a proper entry having been made may result in liabil- ities being incurred under section 592, Tariff Act of 1930, as amended (19 U.S.C. 1592).

(e) [Reserved] (f) Material for the maintenance or

repair of international cables under the high seas, if requiring storage in spe- cial tanks for preservation, may be placed in tanks specially bonded for the purpose and withdrawn therefrom for high-seas installation without the payment of duty and without limita- tion of the storage period to the usual 3-year warehousing period. Inter- national cables laid under the terri- torial waters of the United States but not brought on shore in the United States shall be admitted without entry or the payment of duty. With respect to international cables laid under the territorial waters of the United States but brought on shore in the United States, only that part of the cable in the United States between the point of entry into the territorial waters of the United States and the first point of support on land in the United States shall be admitted without the payment of duty.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 70–121, 35 FR 8222, May 26, 1970; T.D. 79– 160, 44 FR 31956, June 4, 1979; T.D. 84–109, 49 FR 19450, May 8, 1984; T.D. 88–12, 53 FR 9315, Mar. 22, 1988; T.D. 93–66, 58 FR 44130, Aug. 19, 1993; T.D. 99–79, 64 FR 61205, Nov. 10, 1999]

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00128 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

119

U.S. Customs and Border Protection, DHS; Treasury § 10.41a

§ 10.41a Lift vans, cargo vans, shipping tanks, skids, pallets, and similar in- struments of international traffic; repair components.

(a)(1) Lift vans, cargo vans, shipping tanks, skids, pallets, caul boards, and cores for textile fabrics, arriving (whether loaded or empty) in use or to be used in the shipment of merchandise in international traffic are hereby des- ignated as ‘‘instruments of inter- national traffic’’ within the meaning of section 322(a), Tariff Act of 1930, as amended. The Commissioner of Cus- toms is authorized to designate as in- struments of international traffic, in decisions to be published in the weekly Customs Bulletin, such additional arti- cles or classes of articles as he shall find should be so designated. Such in- struments may be released without entry or the payment of duty, subject to the provisions of this section.

(2) Repair components, accessories, and equipment for any container of for- eign production which is an instrument of international traffic may be entered or withdrawn from warehouse for con- sumption without the deposit of duty if the person making the entry or with- drawal from warehouse files a declara- tion that the repair component was im- ported to be used in the repair of a con- tainer of foreign production which is an instrument of international traffic, or that the accessory or equipment is for a container of foreign production which is an instrument of inter- national traffic. The port director must be satisfied that the importer of the re- pair component, accessory, or equip- ment had the declared intention at the time of importation.

(3) As used in this section, ‘‘instru- ments of international traffic’’ in- cludes the normal accessories and equipment imported with any such in- strument which is a ‘‘container’’ as de- fined in Article 1 of the Customs Con- vention on Containers.

(b) The reexportation of a container, as defined in Article 1 of the Customs Convention on Containers, which has become badly damaged, shall not be re- quired in the case of a duly authenti- cated accident if the container (1) is subjected to applicable import duties and import taxes, or (2) is abandoned free of all expense to the Government

or destroyed under Customs super- vision at the expense of the parties concerned, following the procedure outlined in § 158.43(c) of this chapter. Any salvaged parts and materials shall be subjected to applicable import du- ties and import taxes. Replaced parts which are not reexported shall be sub- jected to import duties and import taxes except where abandoned free of expense to the Government or de- stroyed under Customs supervision at the expense of the parties concerned.

(c) The instruments of international traffic designated in paragraph (a) of this section may be released in accord- ance with the provisions of that para- graph only after the applicant for such release has filed a bond on Customs Form 301, containing the bond condi- tions set forth in § 113.66 of this chap- ter. The required application may be filed at the port of arrival or at a sub- sequent port to which an instrument shall have been transported in bond or to which a container shall have been moved under cover of a TIR carnet (see part 114 of this chapter) showing the characteristics and value of the con- tainer on the Goods Manifest of the carnet. If the container is listed on the Goods Manifest of the carnet, the ap- plication may be filed at the port of ar- rival or at the subsequent port. If the container is not listed on the Goods Manifest, the application shall be filed at the port of arrival. When the appli- cation is filed at a port other than the port at which the bond is on file, the following procedure applies:

(1) When the application is filed be- fore the fact of approval of the appli- cant’s bond has been established, the applicant must submit with the appli- cation, or the Customs officer to whom the application is made must obtain, evidence that a current bond is on file at another port. That evidence may consist of a certified copy of the bond, or any other evidence which will sat- isfy the Customs officer to whom the application is made that a current bond is on file at another port.

(2) If the application is filed after the fact of approval of the applicant’s bond has been established, a certified copy of that bond need not be filed at the port of release. Upon determination by the appropriate Customs officer that

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00129 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

120

19 CFR Ch. I (4–1–12 Edition)§ 10.41a

the fact of approval of the applicant’s bond has been established, and the bond has not been subsequently discon- tinued, the instruments of inter- national traffic will be released as pro- vided for in paragraph (a) of this sec- tion.

(3) Upon the request of the applicant, the appropriate Customs officer at the port at which the instruments of inter- national traffic are to be released will determine whether or not the fact of approval of the applicant’s bond has been established. If the approval has not been established, the Customs offi- cer with whom the application has been filed will advise the applicant of the nature of the evidence required to establish the fact that a current bond is on file at another port.

(d) If an instrument of foreign origin, or of United States origin which has been increased in value or improved in condition by a process of manufacture or other means while abroad, is re- leased under this section and is subse- quently diverted to point-to-point local traffic within the United States, or is otherwise withdrawn in the United States from its use as an instrument of international traffic, it becomes sub- ject to entry and the payment of any applicable duties. An instrument of United States origin which has not been increased in value or improved in condition by a process of manufacture or other means while abroad and which is released under this section shall not be subject to entry or the payment of duty if it is so diverted or otherwise withdrawn.

(e) The person who filed the applica- tion for release under paragraph (a)(1) of this section shall promptly notify a director of a port of entry in the United States as defined in Section 401(k), Tariff Act of 1930, as amended, (1) that the container is to be aban- doned or destroyed, as described in paragraph (b) of this section, or (2) that the instrument is the subject of a di- version or withdrawal as described in paragraph (d) of this section, in which event he shall file with the port direc- tor a consumption entry for the instru- ment and pay all import duties and im- port taxes due on the container or in- strument at the rate or rates in effect

and in its condition on the date of such diversion or withdrawal.

(f)(1) Except as provided in paragraph (j) of this section, an instrument of international traffic (other than a con- tainer as defined in Article 1 of the Customs Convention on Containers that is governed by paragraphs (g) (1)– (3) of this section) may be used as fol- lows in point-to-point traffic, provided such traffic is incidental to the effi- cient and economical utilization of the instrument in the course of its use in international traffic:

(i) Picking up and delivering loads at intervening points in the United States while en route between the port of ar- rival and the point of destination of its imported cargo; or

(ii) Picking up and delivering loads at intervening points in the United States while en route from the point of destination of imported cargo to a point where export cargo is to be load- ed or to an exterior port of departure by a reasonably direct route to, or nearer to, the place of such loading or departure.

(2) Neither use as enumerated in paragraph (f)(1)(i) or (ii) of this section constitutes a diversion to unpermitted point-to-point local traffic within the United States or a withdrawal of an in- strument in the United States from its use as an instrument of international traffic under this section.

(g)(1) Except as provided in para- graph (j) of this section, a container (as defined in Article 1 of the Customs Convention on Containers) that is des- ignated as an instrument of inter- national traffic is deemed to remain in international traffic provided that the container exits the U.S. within 365 days of the date on that it was admitted under this section. An exit from the U.S. in this context means a movement across the border of the United States into a foreign country where either:

(i) All merchandise is unladen from the container; or

(ii) Merchandise is laden aboard the container (if the container is empty).

(2) The person who filed the applica- tion for release under paragraph (a)(1) of this section is responsible for keep- ing and maintaining such records, oth- erwise generated and retained in the ordinary course of business, as may be

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00130 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

121

U.S. Customs and Border Protection, DHS; Treasury § 10.41b

necessary to establish the inter- national movements of the containers. Such records shall be made available for inspection by Customs officials upon reasonable notice.

(3) If the container does not exit the U.S. within 365 days of the date on which it is admitted under this section, such container shall be considered to have been removed from international traffic, and entry for consumption must be made within 10 business days after the end of the month in which the container is deemed removed from international traffic. When entry is re- quired under this section, any con- tainers considered removed from inter- national traffic in the same month may be listed on one entry. Such entry may be made at any port of entry. Under 19 U.S.C. 1484(a)(1)(B), the im- porter of record is required, using rea- sonable care, to complete the entry by filing with Customs the declared value, classification and rate of duty applica- ble to the merchandise. The importer of record must use the value of the con- tainer as determined in accordance with section 402, Tariff Act of 1930 (19 U.S.C. 1401a), as amended by the Trade Agreements Act of 1979 (TAA).

(h) For failure promptly to report the diversion or withdrawal or promptly to make the required entry and pay the duties due, the applicant shall be liable for the payment of liquidated damages equal to the domestic value of the in- strument established in accordance with Section 606, Tariff Act of 1930.

(i) When an instrument of inter- national traffic, as provided in para- graph (a) of this section, is returned to the United States and released in ac- cordance with the provisions of that paragraph, any repairs which may have been made to the instrument while it was abroad are not subject to entry or the payment of duty whether the in- strument is of foreign or domestic manufacture, whether it left the United States empty or loaded, and whether or not the repairs made abroad were in contemplation when the instru- ment left the United States.

(j) Containers and other articles des- ignated as instruments of international traffic in accordance with this section are nevertheless subject to the applica- tion of the coastwise laws of the United

States, with particular reference to Section 883, Title 46, United States Code (see § 4.93 of this chapter).

[28 FR 14663, Dec. 31, 1963]

EDITORIAL NOTE: For FEDERAL REGISTER ci- tations affecting § 10.41a, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at www.fdsys.gov.

§ 10.41b Clearance of serially num- bered substantial holders or outer containers.

(a) The holders and containers de- scribed in this section may be released without entry or the payment of duty, subject to the provisions of this sec- tion.

(b) Subject to the approval of a port director pursuant to the procedures de- scribed in this paragraph, certain foreign- or U.S.-made shipping devices arriving from Canada or Mexico, in- cluding racks, holders, pallets, totes, boxes and cans, need not be serially numbered or marked if they are always transported on or within either inter- modal and similar containers or con- tainers which are themselves vehicles or vehicle appurtenances and acces- sories such as twenty and forty foot containers of general use and ‘‘igloo’’ air freight containers. The following or similar notation shall appear on the vehicle or vessel manifest in relation to such shipping devices which are ex- empt from serial numbering or mark- ing requirements pursuant to this paragraph: ‘‘The shipping devices transported herein, which are not seri- ally numbered or marked, have been exempted from such requirement pur- suant to an application approved under 19 CFR 10.41b(b).’’ Also, pallets and other solid wood shipping devices must be accompanied by an importer docu- ment, to the extent that this is re- quired by the U.S. Department of Agri- culture, Animal and Plant Health In- spection Service, attesting to the ad- missibility of such devices as regards plant pest risk, as provided for in 7 CFR 319.40–3.

(1) An importer or his agent, regard- less of whether the importer is the owner of the foreign- or U.S.-manufac- tured shipping devices, may apply to a port director of Customs at one of the importer’s chiefly utilized Customs

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00131 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

122

19 CFR Ch. I (4–1–12 Edition)§ 10.41b

ports or the port within which the im- porter’s or agent’s recordkeeping cen- ter is located for permission to have such shipping devices arriving from Canada or Mexico released without entry and payment of duty at the time of arrival and without the devices being serially numbered or marked. Application may be filed in only one port. Although no particular format is specified for the application, it must contain the information enumerated in paragraph (b)(2) of this section. Any duty which may be due on these ship- ping devices shall be tendered and paid cumulatively at the time specified in an approved application, which may be either before or after the arrival of the shipping devices in the U.S. (such as, at the time a contract, purchase order or lease agreement is issued).

(2) The application shall: (i) Describe the types of shipping de-

vices covered, their classification under the Harmonized Tariff Schedule of the U.S. (HTSUS), their countries of origin, and whether and to whom re- quired duty was paid for them or when it will be paid for them, including du- ties for repair and modifications to such shipping devices while outside the U.S.;

(ii) Identify the intended ports where it is anticipated the shipping devices will be arriving and departing the U.S., as well as the particular movements and conveyances in which they are in- tended to be utilized;

(iii) Describe the applicant’s pro- posed program for accounting for and reporting these shipping devices;

(iv) Identify the reporting period (which shall in no event be less fre- quent than annual), as well as the pay- ment period within which applicable duty and fees must be tendered (which shall in no event exceed 90 days fol- lowing the close of the related report- ing period);

(v) Describe the type of inventory control and recordkeeping, including the specific records, to be maintained to support the reports of the shipping devices; and

(vi) Provide the location in the United States, including the name and address, where the records supporting the reports will be retained by law and will be made available for inspection

and audit upon reasonable notice. (The records supporting the reports of the shipping devices must be kept for a pe- riod of at least 3 years from the date such reports are filed with the port di- rector.)

(3) The application shall be filed along with a continuous bond con- taining the conditions set forth in § 113.66(c) of this chapter. If the applica- tion is approved by the port director and the conditions set forth in the ap- plication or of the bond are violated, the port director may issue a claim for liquidated damages equal to the domes- tic value of the container. If the do- mestic value exceeds the amount of the bond, the claim for liquidated damages will be equal to the amount of the bond.

(4) The port director receiving the ap- plication shall evaluate the program proposed to account for, report and maintain records of the shipping de- vices. The port director may suggest amendments to the applicant’s pro- posal. The port director shall notify the applicant in writing of his decision on the application within 90 days of its receipt, unless this period is extended for good cause and the applicant is so informed in writing. Approval of the application by the port director with whom it is filed shall be binding on all Customs ports nationwide.

(5) If the decision is to deny the ap- plication, in whole or in part, the port director shall specify the reason for the denial in a written reply, and inform the applicant that such denial may be appealed to the Assistant Commis- sioner, Office of Field Operations, Cus- toms Headquarters, within 21 days of its date. The Assistant Commissioner’s decision shall be issued, in writing, within 30 days of the receipt of the ap- peal, and shall constitute the final Cus- toms determination concerning the ap- plication.

(6) If the application is approved, an importer may later apply to amend his application to add or delete particular types of shipping devices listed in the application in which the procedures set forth in the application may be uti- lized. If a requested amendment to an approved application should be denied, or if an approved application should be revoked, in whole or in part, by the

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00132 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

123

U.S. Customs and Border Protection, DHS; Treasury § 10.41b

port director, the procedures described in paragraph (b)(5) of this section shall apply.

(7) Application for and approval of a reporting program shall not limit or restrict the use of other alternative means for obtaining the release of holders, containers and shipping de- vices.

(c) In the case of serially numbered holders or containers of United States manufacture for which free clearance under subheading 9801.00.10, Har- monized Tariff Schedule of the United States, is claimed, the owner shall place thereon the following markings:

(1) 9801.00.10, unless the holder or con- tainer has permanently attached there- to the manufacturer’s metal tag or plate showing, among other things, the name and address of the manufacturer who is located in the United States.

(2) The name of the owner, either po- sitioned as indicated in the example below, or elsewhere conspicuously shown on the holder or container.

(3) The serial number assigned by the owner, which shall be one of consecu- tive numbers and not to be duplicated. For example: 9801.00.10 * * * Zenda * * * 2468.

(d)(1) In the case of serially num- bered holders or containers of foreign manufacture, other than those pro- vided for in paragraph (d)(2) of this sec- tion, for which free clearance under the second provision in subheading 9803.00.50, HTSUS (19 U.S.C. 1202), is claimed, the owner shall place thereon the following markings:

(i) 9803.00.50. (ii) The district and port code num-

bers of the port of entry, the entry number, and the last two digits of the fiscal year of entry covering the impor- tation of the holders and containers on which duty was paid.

(iii) The name of the owner, either positioned as indicated in the example below, or elsewhere conspicuously shown on the holder or container.

(iv) The serial number assigned by the owner, which shall be one of con- secutive numbers and not to be dupli- cated. For example: 9803.00.50 * * * 10– 1–366–63 * * * Zenda * * * 2468.

(2) In the case of substantial holders or containers of either U.S. or foreign manufacture, specially designed and

equipped to facilitate the carriage of goods by one or more modes of trans- port without intermediate reloading, each having a gross mass rating of at least 18,120 kilograms, for which duty- free entry is requested under either the first or the second proviso in sub- heading 9803.00.50, HTSUS (19 U.S.C. 1202), is claimed, only the following clear, conspicuous and durable mark- ings are required to be on the con- tainer:

(i) The identity of the owner or oper- ator of the container.

(ii) The serial number assigned by the owner or operator of the container, which shall be one of consecutive num- bers and shall not be duplicated.

(e) The prescribed markings shall be clear and conspicuous, that is, they shall appear on an exposed side of the holder or container in letters and fig- ures of such size as to be readily dis- cernible. The markings will be stricken out or removed when the holders or containers are taken out of service or when ownership is transferred, except that appropriate changes may be made if a new owner wishes to use the hold- ers and containers under this proce- dure.

(f) The owner shall keep adequate records open to inspection by Customs officers, which shall show the current status of the serially numbered holders and containers in service and the dis- position made of such holders and con- tainers taken out of service.

(g) Nothing in this procedure shall be deemed to affect:

(1) The requirements for outward or inward manifesting of such holders or containers. The manifests will show for each holder or container its markings as provided for herein.

(2) The requirements of the Depart- ment of Commerce on exportation with respect to the filing of ‘‘Shipper’s Ex- port Declaration,’’ Form 7525–V.

(3) The treatment of articles covered herein under the coastwise laws of the United States, with particular ref- erence to section 883, Title 46, United States Code.

(h) If the holder or container and its contents are to move in bond or under cover of a TIR carnet (see part 114 of this chapter) from the port of arrival intact, the holder or container shall

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00133 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

124

19 CFR Ch. I (4–1–12 Edition)§ 10.43

appear on the inward foreign manifest so as to be related to the cargo con- tained therein and will be released under this procedure at a subsequent port. If the holder or container is to move in bond or under cover of a TIR carnet from the port of arrival not in- tact with its contents, the holder or container may appear on the inward foreign manifest separate from and not related to the cargo contained therein and will be released under this proce- dure at the port of arrival before it moves forward and will not appear on the in-bond document.

(i) A continuous bond containing the conditions set forth in § 113.66 of this chapter shall be filed with the port di- rector. If the conditions are violated the port director shall issue a claim for liquidated damages equal to the domes- tic value of the holder or container es- tablished in accordance with section 606, Tariff Act of 1930, as amended (19 U.S.C. 1606). If the domestic value ex- ceeds the amount of the bond the claim for liquidated damages will be equal to the amount of the bond.

[T.D. 56542, 30 FR 15143, Dec. 8, 1965, as amended by T.D. 71–70, 36 FR 4485, Mar. 6, 1971; T.D. 84–213, 49 FR 41165, Oct. 19, 1984; T.D. 86–13, 51 FR 4164, Feb. 3, 1986; T.D. 89–1, 53 FR 51249, Dec. 21, 1988; T.D. 96–20, 61 FR 7989, Mar. 1, 1996; T.D. 97–82, 62 FR 51769, Oct. 3, 1997; T.D. 99–64, 64 FR 43265, Aug. 10, 1999]

ARTICLES FOR INSTITUTIONS

§ 10.43 Duty-free status. (a) The port director may, at his dis-

cretion, require appropriate proof of duty-free status for articles for institu- tions claimed to be exempt from duty under subheadings 9810.00.05, 9810.00.15, 9810.00.25, 9810.00.30, 9810.00.40, 9810.00.45, 9810.00.50, 9810.00.55, Harmonized Tariff Schedule of the United States (19 U.S.C. 1202).

(b) Appropriate proof may be a copy of the charter or other evidence of the character of the institution for the use of which the articles are imported.

[T.D. 85–123, 50 FR 29953, July 23, 1985, as amended by T.D. 89–1, 53 FR 51249, Dec. 21, 1988]

§ 10.46 Articles for the United States. Pursuant to subheadings 9808.00.10

and 9808.00.20, books, engravings, and

other articles therein enumerated, which are imported by authority or for the use of the United States or for the use of the Library of Congress, shall be admitted free of duty upon the written request of the head of the bureau or ex- ecutive department concerned.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 67–108, 32 FR 6392, Apr. 25, 1967; T.D. 89– 1, 53 FR 51249, Dec. 21, 1988; T.D. 97–82, 62 FR 51769, Oct. 3, 1997]

§ 10.47 [Reserved]

WORKS OF ART

§ 10.48 Engravings, sculptures, etc. (a) Invoices covering works of art

claimed to be free of duty under sub- headings 9702.00.00 and 9703.00.00, HTSUS, shall show whether they are originals, replicas, reproductions, or copies, and also the name of the artist who produced them, unless upon exam- ination the Customs officer is satisfied that such statement is not necessary to a proper determination of the facts.

(b) The following evidence shall be filed in connection with the entry: A declaration in the following form by the artist who produced the article, or by the seller, shipper or importer, showing whether it is original, or in the case of sculpture, the original work or model, or one of the first twelve castings, replicas, or reproductions made from the original work or model; and in the case of etchings, engravings, woodcuts, lithographs, or prints made by other hand-transfer processes, that they were printed by hand from hand- etched, hand-drawn, or hand-engraved plates, stones, or blocks:

I, llll, do hereby declare that I am the producer, seller, shipper or importer of cer- tain works of art, namely llll covered by the annexed invoice dated llll; that any sculptures or statuary included in that in- voice are the original works or models or one of the first twelve castings, replicas, or re- productions made from the sculptor’s origi- nal work or model; and that any etchings, engravings, woodcuts, lithographs, or prints made by other hand-transfer processes in- cluded in that invoice were printed by hand from hand-etched, hand-drawn, or hand-en- graved plates, stones, or blocks.

(c) The port director may waive the declaration requirement set forth in paragraph (b) of this section.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00134 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

125

U.S. Customs and Border Protection, DHS; Treasury § 10.53

(d) Artists’ proof etchings, engravings, woodcuts, lithographs, or prints made by other hand-transfer processes should bear the genuine sig- nature or mark of the artist as evi- dence of their authenticity. In the ab- sence of such a signature or mark, other evidence shall be required which will establish the authenticity of the work to the satisfaction of the port di- rector.

[T.D. 94–3, 58 FR 68742, Dec. 29, 1993]

§ 10.49 Articles for exhibition; require- ments on entry.

(a) There shall be filed in connection with the entry of works of art and other articles claimed to be free of duty under Chapter 98, Subchapter XII, Harmonized Tariff Schedule of the United States (HTSUS), a declaration by a qualified officer of the institution in sufficient detail to demonstrate en- titlement to entry as claimed, and a bond on Customs Form 301, containing the bond conditions set forth in § 113.62 of this chapter. Claim for free entry under Chapter 98, Subchapter XII may be made for articles of the character described therein which have been pre- viously entered under any other provi- sion of law and the entry amended ac- cordingly upon compliance with the re- quirements of this section, provided the articles have not been released from Customs custody.

(b) The port director may require a copy of the charter or other evidence of the character of the institution for which the articles are imported, and may also require the production of the original of any order given by such so- ciety or institution to any importing agent or dealer for such articles. The society or institution shall file, within 6 months after the date of filing the entry, any document or proof de- manded by the port director in connec- tion with the entry.

(c) Articles entered under subheading 9812.00.20, HTSUS, may be transferred from one institution to another upon an application in writing in the case of each transfer describing the articles and stating the name of the institution to which transfer is to be made, pro- vided the sureties to the bond assent in writing under seal or a new bond is

filed. No entry or withdrawal shall be required for such a transfer.

(d) If any of the articles accorded free entry under Chapter 98, Subchapter XII shall be sold, offered or exposed for sale, transferred, or used in any man- ner contrary to the provisions of the regulations in this part, within 5 years after the date of entry under such part, the amount of the duties shall be col- lected immediately by the director of the port of entry and deposited as du- ties. If the articles are exported or de- stroyed under Customs supervision within such 5-year period, the liability under the bond shall be treated as ter- minated.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 84–213, 49 FR 41166, Oct. 19, 1984; T.D. 89– 1, 53 FR 51249, Dec. 21, 1988; T.D. 92–85, 57 FR 40605, Sept. 4, 1992]

§ 10.50 [Reserved]

§ 10.52 Painted, colored or stained glass windows for religious institu- tions.

When painted, colored, or stained glass windows or parts thereof, are claimed free of duty under subheading 9810.00.10, Harmonized Tariff Schedule of the United States (19 U.S.C. 1202), the port director may, at his discre- tion, require appropriate proof that the importation was designed by, and pro- duced by or under the direction of, a professional artist, and that it is for the use of an institution established solely for religious purposes.

[T.D. 85–123, 50 FR 29953, July 23, 1985, as amended by T.D. 89–1, 53 FR 51250, Dec. 21, 1988]

§ 10.53 Antiques.

(a) Articles accompanying a pas- senger and entitled to entry under the passenger’s declaration and entry, or articles entered under an informal entry which are claimed to be free of duty under subheading 9706.00.00, Har- monized Tariff Schedule of the United States (HTSUS), may be admitted free of duty upon the execution of a dec- laration on the face of the entry pro- vided that the passenger or person fil- ing the informal entry is the owner of the articles and that they are for his personal use and not for sale or other

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00135 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

126

19 CFR Ch. I (4–1–12 Edition)§ 10.53

commercial use and provided the Cus- toms officer concerned is satisfied that the articles are of the requisite age.

(b) Antiques of the age prescribed by subheading 9706.00.00, HTSUS, or ad- mitted under the provisions of para- graph (e) of this section, shall be ad- mitted free of duty though repaired or renovated. If, however, an antique has been repaired with a substantial amount of additional material, without changing the original form or shape, the original and added portions shall be appraised and reported as separate en- tities and the basis for such report shall be plainly indicated on the in- voice by the appraiser. In such cases duty shall be assessed on the portion added. If the repairs consist of an addi- tion to an article of a feature which changes it substantially from the arti- cle originally produced, or if the an- tique portion has otherwise been so changed as to lose its identity as the article which was in existence prior to the time prescribed in subheading 9706.00.00, HTSUS, the entire article shall be excluded from free entry under subheading 9706.00.00, HTSUS.

(c) Except for furniture admitted under the provisions of paragraph (e) of this section, furniture claimed to be free of duty under subheading 9706.00.00, Harmonized Tariff Schedule of the United States (HTSUS) may be entered for consumption at any port of entry within the customs territory of the United States. Furniture as used in this section of the regulations is de- fined as ‘movable articles of conven- ience or decoration for use in fur- nishing a house, apartment, place of business or accommodation’. This defi- nition embraces most articles claimed to be free of duty as antiques.

(d) A claim for the free entry of an article under subheading 9706.00.00, HTSUS on the basis of antiquity may be made on the entry, or filed after entry at any time prior to liquidation of the entry, provided the article has not been released from Customs cus- tody or it has been found upon exam- ination before such release to be de- scribed in subheading 9706.00.00, HTSUS.

(e) Antique articles otherwise prohib- ited entry by the Endangered Species

Act of 1973 (16 U.S.C. 1521, et seq.) may be entered if:

(1) The article is composed in whole or in part of any endangered or threat- ened species listed in 50 CFR 17.11 or 17.12,

(2) The article is not less than 100 years of age,

(3) The article has not been repaired or modified with any part of any such endangered or threatened species, on or after December 28, 1973,

(4) The article is entered at a port designated in § 12.26 of this chapter,

(5) A Declaration for Importation or Exportation of Fish or Wildlife (USFWS Form 3–177) is filed at the time of entry with the port director who will forward the form to the U.S. Fish and Wildlife Service, and

(6) The importer meets the require- ments of paragraph (a) of this section.

(f) The additional duty imposed by additional U.S. Note 2, Chapter 97, HTSUS, shall apply to any article which is imported for sale and claimed, either at the time of entry or at a later date, to be free of duty under sub- heading 9706.00.00, HTSUS, if such arti- cle is later found to be unauthentic in respect of the antiquity claimed as a basis for such free entry, unless the claim under subheading 9706.00.00, HTSUS, is withdrawn in writing before the examination of the article for the purpose of appraisement or classifica- tion has begun.

(g) The additional duty provided for in additional U.S. Note 2, Chapter 97, HTSUS shall not be assessed if the im- porter established by evidence satisfac- tory to the port director that the arti- cle was not imported for sale. In the case of any article imported in a pas- senger’s baggage or entered under an informal entry, the Customs officer concerned may accept the statement of the owner that the article was not im- ported for sale if he is satisfied of the truth of such statement.

[28 FR 14663, Dec. 31, 1963]

EDITORIAL NOTE: For FEDERAL REGISTER ci- tations affecting § 10.53, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at www.fdsys.gov.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00136 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

127

U.S. Customs and Border Protection, DHS; Treasury § 10.58

§ 10.54 Gobelin and other hand-woven tapestries.

Pursuant to subheading 5805.00.10, Harmonized Tariff Schedule of the United States, Gobelin tapestries pro- duced in the Manufacture Nationale des Gobelins factories at Paris and Beauvais under the direction and con- trol of the French Government, and other hand-woven tapestries, shall be accorded free entry if of a kind fit only for use as wall hangings, and valued over $215 per square meter.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 87–75, 52 FR 20066, May 29, 1987; T.D. 89– 1, 53 FR 51250, Dec. 21, 1988]

VEGETABLE OILS

§ 10.56 Vegetable oils, denaturing; re- lease.

(a) Olive, palm-kernel, rapeseed, sun- flower, and sesame oil shall be classifi- able under subheadings 1509.10.20, 1509.10.40, 1509.90.20, 1509.90.40, 1510.00.20, 1512.19.20, 1513.29.00, 1514.90.10, 1514.90.50, 1515.50.00, Harmonized Tariff Schedule of the United States, if denatured abroad or under Customs supervision after importation but before release from Customs custody, at the request and expense of the importer, by a for- mula prescribed by Headquarters, U.S. Customs Service, or if by their method of production abroad they are rendered unfit for use as food or for any but me- chanical or manufacturing purposes.

(b) Each cask or package of oil claimed to have been before importa- tion denatured or otherwise rendered unfit for use as food or for any but me- chanical or manufacturing purposes shall be sampled and tested by an ap- praising officer.

(c) Formulas prescribed by Head- quarters, U.S. Customs Service, except proprietary mixtures, will be cir- culated to all Customs officers and will appear as abstracts of United States Customs Service decisions published in the weekly Customs Bulletins. Propri- etary mixtures approved by the Com- missioner of Customs will not be pub- lished but appropriate notice of their approval will be given to all Customs officers.

(d) The Headquarters, U.S. Customs Service, will from time to time pre- scribe additional formulas, and will

consider any formula for special dena- turing that may be submitted.

(e) The port director may, if he deems it advisable, require an importer requesting permission to use any au- thorized denaturant to submit to the appraiser an adequate sample of such denaturant, in order that the appraiser may report to the port director wheth- er or not such denaturant is suitable for rendering the oil unfit for use as food or for any but mechanical or man- ufacturing purposes.

(f) No such oil shall be released free of duty until the appraiser shall have made a special report that it has been properly denatured.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 66–182, 31 FR 11416, Aug. 30, 1966; T.D. 87– 75, 52 FR 20066, May 29, 1987; T.D. 89–1, 53 FR 51250, Dec. 21, 1988]

POTATOES, CORN, OR MAIZE

§ 10.57 Certified seed potatoes, and seed corn or maize.

Claim for classification as seed pota- toes under subheading 0701.10.00, as seed corn (maize) under subheading 1005.10., HTSUS, shall be made at the time of entry. Such classification shall be allowed only if the articles are white or Irish potatoes, or maize or corn, imported in containers and if, at the time of importation, there is firmly affixed to each container an official tag supplied by the government of the country in which the contents were grown, or an agency of such govern- ment. The tag shall bear a certificate to the effect that the specified contents of the container were grown, and have been approved, especially for use as seed. The tag shall also bear a number or other symbol identifying the pota- toes or corn in the container with an inspection record of the foreign govern- ment or its agency on the basis of which the certificate was issued.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 89–1, 53 FR 51250, Dec. 21, 1988]

BOLTING CLOTHS

§ 10.58 Bolting cloths; marking. (a) As a prerequisite to the free entry

of bolting cloth for milling purposes under subheading 5911.20.20, Har- monized Tariff Schedule of the United

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00137 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

128

19 CFR Ch. I (4–1–12 Edition)§ 10.59

States, the cloth shall be indelibly marked from selvage to selvage at in- tervals of not more then 10.16 centi- meters with ‘‘bolting cloth expressly for milling purposes’’ in block letters 7.62 centimeters in height. Bolting cloths composed of silk imported ex- pressly for milling purposes shall be considered only such cloths as are suit- able for and are used in the act or proc- ess of grading, screening, bolting, sepa- rating, classifying, or sifting dry mate- rials, or dry materials mixed with water, if the water is merely a carrying medium.

(b) Bolting cloths not marked in the manner above indicated at the time of importation may be so marked by the importers in public stores under the su- pervision of customs officers.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 87–75, 52 FR 20066, May 29, 1987; T.D. 89– 1, 53 FR 51250, Dec. 21, 1988]

WITHDRAWAL OF SUPPLIES AND EQUIPMENT FOR VESSELS

§ 10.59 Exemption from customs duties and internal-revenue tax.

(a) A vessel shall not be considered to be actually engaged in the foreign trade, or in trade between the Atlantic and Pacific ports of the United States, or between the United States and its possessions, or between Hawaii and any other part of the United States or be- tween Alaska and any other part of the United States, as the case may be, for the purpose of withdrawing supplies free of duty and internal-revenue tax pursuant to section 309(a), Tariff Act of 1930, as amended, unless it is—

(1) Operating on a regular schedule in a class of trade which entitles it to the privilege;

(2) Actually transporting passengers or merchandise to or from a foreign port, a port on the opposite coast of the United States, or between a port in a possession of the United States and a port in the United States or in another of its possessions, or between Hawaii and any other part of the United States or between Alaska and any other part of the United States;

(3) Departing in ballast (without cargo or passengers) from one port for another, domestic or foreign, for the purpose of lading passengers or cargo

at the port of destination for carriage in a class of trade specified in section 309(a), Tariff Act of 1930, as amended, for which class of trade the vessel is suitable and substantially ready for service with necessary fittings, outfit, and equipment already installed on its departure in ballast, and from which it is not diverted prior to carriage of pas- sengers or cargo in such trade. A writ- ten declaration of the owner or agent of the vessel may be required in con- nection with the withdrawal, certifying to the vessel’s suitableness and sub- stantial readiness with necessary fit- tings, outfit, and equipment already in- stalled on its departure in ballast for service in a class of trade specified in section 309 and agreeing to notify the port director if it is laid up or diverted from such class of trade prior to the carriage of cargo or passengers in such trade.

(b) A withdrawal of articles may not be made under section 309, Tariff Act of 1930, as amended, for use on a trial or test trip of a vessel preparatory to its actually engaging in trades.

(c) The classes of articles which may be withdrawn as provided for by sec- tion 309, Tariff Act of 1930, as amended, include the containers in which the ar- ticles are withdrawn and laden even though for tariff purposes the con- tainers are classifiable separately from their contents, except unusual con- tainers within the purview of General Rule of Interpretation 5, Harmonized Tariff Schedule of the United States (HTSUS).

(d) For the purpose of allowing the privileges of section 309, Tariff Act of 1930, as amended, to aircraft as pro- vided for therein, an aircraft shall be deemed to be a vessel within the mean- ing of each provision of this section and of §§ 10.60 through 10.64 which may be applied to aircraft.

(e) A documented vessel with a fish- eries license endorsement and foreign fishing vessels of 5 net tons or over may be allowed to withdraw distilled spirits (including alcohol), wines, and beer conditionally free under section 309, Tariff Act of 1930, as amended (19 U.S.C. 1309), if the port director is sat- isfied from the quantity requested, in the light of (1) whether the vessel is employed in substantially continuous

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00138 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

129

U.S. Customs and Border Protection, DHS; Treasury § 10.59

fishing activities, and (2) the vessel’s complement, that none of the with- drawn articles is intended to be re- moved from the vessel in, or otherwise returned to, the United States without the payment of duty or tax. Such with- drawal shall be permitted only after the approval by the port director of a special written application, in trip- licate, on Customs Form 5125, of the withdrawer, supported by a bond on Customs Form 301, containing the bond conditions set forth in § 113.62 of this chapter executed by the withdrawer. Such application shall be filed with Customs Form 7501 or 7512, as the case may be. The original and the triplicate copy of the application, after approval, shall be stamped with the withdrawal number and date thereof and shall be returned to the withdrawer for use as prescribed below. Approval of each such application shall be subject to the condition that the original and the triplicate copy shall be presented thereafter by the withdrawer or the vessel’s master to the port director within 24 hours (excluding Saturday, Sunday, and holidays) after each subse- quent arrival of the vessel at a Cus- toms port or station and that an ac- counting shall be made at the time of such presentation of the disposition of the articles until the port director is satisfied that all of them have been consumed on board, or landed under Custom’s supervision, and takes up the original application. (The withdrawer shall retain the triplicate copy as evi- dence of consumption on board or land- ing under Customs supervision.) The approval shall be subject to the further conditions that any such withdrawn ar- ticle remaining on board while the ves- sel is in port shall be safeguarded in the manner and to such extent as the district director for the port or place of arrival shall deem necessary and that failure to comply with the conditions upon which a conditionally free with- drawal is approved shall subject the total quantity of withdrawn articles to the assessment and collection of an amount equal to the duties and taxes that would have been assessed on the entire quantity of supplies withdrawn had such supplies been regularly en- tered, or withdrawn, for consumption.

Exemption from internal-revenue tax on distilled spirits, alcohol, wines, and beer removed from any internal-rev- enue bonded warehouse, industrial al- cohol premises, bonded wine cellar, or brewery; and drawback on taxpaid dis- tilled spirits or wines removed from an export storage room, or on taxpaid beer removed from a brewery (or place of storage elsewhere), for use as supplies on vessels under section 309, Tariff Act of 1930, as amended, are governed by regulations of the Internal Revenue Service.

(f) Pursuant to section 309(d) of the Tariff Act of 1930, as amended, the De- partment of Commerce has found and advised the Secretary of the Treasury of the foreign countries which allow privileges to aircraft registered in the United States substantially reciprocal to those described in sections 309 and 317 of the Tariff Act of 1930, as amend- ed. Advices also have been received of changes and limitations of privileges allowed. In accordance with these ad- vices, Treasury decisions are issued ex- tending to the aircraft of foreign coun- tries free withdrawal privileges recip- rocal to those found by the Secretary of Commerce to be extended by those countries to aircraft registered in the United States or making changes in such privileges on the basis of new findings. Listed below by countries are the Treasury decisions issued pursuant to such findings which are currently in effect:

Country TreasuryDecision(s) Exceptions if any, as

noted—

Abu Dhabi ............ 95–45 Argentina ............. 54925 (1)

92–20 Applicable only as to air-

craft equipment, spare parts, and supplies.

Australia ............... 54747 (1) Not applicable to ground equipment.

Austria .................. 80–68 Bahamas .............. 52798 (3) Bahrain ................ 95–45 Belgium ................ 52846 (2) Benin .................... 71–215,93- Bermuda .............. 49944 (4) Brazil .................... 53281 (2) Canada ................ 69–149

69–245 Not applicable to ground

equipment during period May 1 to September 16, 1969, inclusive.

Chile ..................... 66–128 (2) China* .................. 82–91 Colombia .............. 70–107 (1) Costa Rica ........... 53658 (1) Cuba .................... 81–198 Applicable only as to air-

craft supplies. Czechoslovakia .... 70–107 (1)

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00139 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

130

19 CFR Ch. I (4–1–12 Edition)§ 10.60

Country TreasuryDecision(s) Exceptions if any, as

noted—

Denmark .............. 51966 (3) Dominican Repub-

lic. 54522 (1)

Ecuador ............... 52510 (4) Egypt .................... 74–3

85–141 El Salvador .......... 54675 (1) Finland ................. 69–120 (2) France .................. 67–96 (1) Not applicable to tobacco

products under section 317 of the tariff act. Not applicable to ground equipment.

Federal Republic of Germany.

69–150 Not applicable to ground equipment.

Greece ................. 54847 (1) Guyana ................ 78–28 Honduras ............. 71–154 Iceland ................. 67–265 (1) India ..................... 55155 (1) Indonesia ............. 90–61 Applicable only as to avia-

tion fuels and lubricants. Iran ....................... 75–254 Ireland .................. 55291 (1) Israel .................... 52831 (3) Italy ...................... 69–223 Not applicable to ground

equipment. Ivory Coast .......... 71–215 Jamaica ............... 70–250 Japan ................... 53550 (1),

88–45 Not applicable to ground

support equipment as of August 1, 1986

Jordan .................. 74–102 Kenya ................... 71–102 Applicable only as to air-

craft fuels and lubricants. Lebanon ............... 53902 (1) Luxembourg ......... 89–77 Applicable only as to avia-

tion fuels. Mexico ................. 54506 (5) Morocco ............... 75–254 Netherlands ......... 52494 (2) Netherlands Antil-

les. 71–211

New Zealand ....... 73–52 Not applicable to ground equipment.

Nicaragua ............ 54640 (1) Norway ................. 51966 (3) Oman ................... 95–45 Pakistan ............... 55416 (1) Panama ............... 55453 (1) Peru ..................... 52911 (2) Poland .................. 72–153 Portugal ............... 68–107 (1) Not applicable to ground

equipment. Qatar .................... 95–45 Republic of Korea 71–140 Republic of the

Philippines. 71–197

Romania .............. 75–35 Saudi Arabia ........ 73–307,

92–68 Senegal ................ 71–215 Singapore ............ 93–25 South Africa ......... 69–162 Not applicable to ground

equipment. Spain .................... 54522 (2) Sweden ................ 51966 (3) Switzerland .......... 56047 Taiwan ................. 70–107 (1),

82–91 Not applicable to ground

equipment. Tanzania .............. 71–102 Applicable only as to air-

craft fuels and lubricants. Thailand ............... 71–138,

89–6

Country TreasuryDecision(s) Exceptions if any, as

noted—

Trinidad and To- bago.

56441 (1)

Turkey .................. 89–7 Uganda ................ 71–102 Applicable only as to air-

craft fuels and lubricants. Union of Soviet

Socialist Repub- lics.

67–123 (1)

United Kingdom ... 69–176 Not applicable to ground equipment.

Venezuela ............ 55425 (1) Yugoslavia ........... 71–138 Zambia ................. 89–5

*See also Taiwan

[28 FR 14663, Dec. 31, 1963]

EDITORIAL NOTE: For FEDERAL REGISTER ci- tations affecting § 10.59, see the List of CFR Sections Affected, which appears in the Finding Aids section of the printed volume and at www.fdsys.gov.

§ 10.60 Forms of withdrawals; bond. (a) Withdrawals from warehouse shall

be made on Customs Form 7501. Each withdrawal shall contain the state- ment prescribed for withdrawals in § 144.32 of this chapter and all of the statistical information as provided in § 141.61(e) of this chapter. Withdrawals from continuous Customs custody else- where than in a bonded warehouse shall be made on Customs Form 7512, except as provided for by paragraph (h) of this section. When a withdrawal of supplies or other articles is made which may be used on a vessel while it is proceeding in ballast to another port as provided for by § 10.59(a)(3), a nota- tion of this fact shall be made on the withdrawal and the name of the other port given if known.

(b) If the withdrawal is made by other than the principal on the ware- house or rewarehouse entry, as the case may be, the assent of such prin- cipal shall be endorsed on the with- drawal, unless the principal has other- wise authorized such withdrawal in writing.

(c) A bond on Customs Form 301, con- taining the bond conditions set forth in § 113.62 of this chapter shall be taken when the withdrawal from warehouse is made by a person other than the principal on the warehouse or reware- house entry, as provided for in para- graph (b) of this section.

(d) Except as otherwise provided in § 10.62b, relating to withdrawals from

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00140 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

131

U.S. Customs and Border Protection, DHS; Treasury § 10.62

warehouse of aircraft turbine fuel to be used within 30 days of such withdrawal as supplies on aircraft under § 309, Tar- iff Act of 1930, as amended, when the supplies are to be laden at a port other than the port of withdrawal from ware- house, they shall be withdrawn for transportation in bond to the port of lading. Three copies of the manifest on Customs Form 7512, in addition to six copies of the withdrawal on Customs Form 7501, shall be required. The proce- dure shall be the same as that pre- scribed in § 144.37 of this chapter (the six copies of Customs Form 7501 taking the place of the entry copies of Cus- toms Form 7512).

(e) No bond shall be required in the case of war vessels.

(f) Unless transfer is permitted under the provisions of paragraph (h) of this section, when articles are withdrawn from continuous Customs custody else- where than in a bonded warehouse for lading at the port of withdrawal, the procedure provided for in § 18.25 of this chapter shall be followed, except that the bond required shall be on Customs Form 301, containing the bond condi- tions set forth in § 113.62 of this chap- ter. Unless transfer is permitted under the provisions of paragraph (h) of this section, when articles are withdrawn from continuous Customs custody else- where than in a bonded warehouse for lading at another port, the procedure set forth in § 18.26 of this chapter shall be followed, except that the withdrawal when filed shall be supported by a bond on Customs Form 301, containing the bond conditions set forth in § 113.62 of this chapter. There shall be such exam- ination of the articles as may be nec- essary to satisfy the port director that they are subject to the privileges of section 309, Tariff Act of 1930, as amended, and that the value and quan- tity declared for them are correct.

(g) A withdrawal under § 10.59(e) shall be supported by a bond on Customs Form 301, containing the bond condi- tions set forth in § 113.62 of this chap- ter.

(h) If a request is made for permis- sion to transfer supplies or stores from one vessel to another which would be entitled to withdraw them free of duty and tax under section 309 or 317, Tariff Act of 1930, as amended, the port direc-

tor in his discretion may permit the ar- ticles to be so transferred under Cus- toms supervision under a permit on Customs Form 3171 in lieu of a formal withdrawal under the pertinent stat- ute. In such a case, the pertinent stat- ute shall be indicated by an endorse- ment made on the permit by the port director.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 73–175, 38 FR 17445, July 2, 1973; T.D. 73– 312, 38 FR 30882, Nov. 8, 1973; T.D. 84–213, 49 FR 41166, Oct. 19, 1984; T.D. 95–81, 60 FR 52295, Oct. 6, 1995; T.D. 96–18, 61 FR 6777, Feb. 22, 1996]

§ 10.61 Withdrawal permit.

Upon the filing of the withdrawal and the execution of the bond, when re- quired, the port director shall issue a permit on Customs Form 7501 or 7512.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 95–81, 60 FR 52295, Oct. 6, 1995]

§ 10.62 Bunker fuel oil.

(a) Withdrawal under section 309, Tariff Act of 1930, as amended (19 U.S.C. 1309). Except as otherwise provided in § 10.62b, relating to withdrawals from warehouse of aircraft turbine fuel to be used within 30 days of such withdrawal as supplies on aircraft under section 309, Tariff Act of 1930, as amended (19 U.S.C. 1309), when all the bunker fuel oil in a Customs bonded tank is in- tended only for lading duty free as sup- plies on vessels under section 309 at the port where the tank is located, delivery of the oil, by Customs bonded carrier, cartman, or lighterman (including bonded pipelines), under withdrawals on Customs Form 7501, either single or blanket, may be made without the presence of a Customs officer. When a blanket withdrawal is filed and a par- tial release takes place, the partial re- lease procedure set forth in § 19.6(d) of this chapter shall be followed for each partial release. However, each abstract copy of Customs Form 7501 shall in- clude the following additional informa- tion:

(1) Type of oil withdrawn. (2) Number or other identification of

sales order therefor. (3) Name of bonded carrier, date it re-

ceived oil.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00141 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

132

19 CFR Ch. I (4–1–12 Edition)§ 10.62

(4) Receipt signed by master or other person in charge of delivering convey- ance identified by number, or name, and if Customs bonded lighterman or cartman, by the carrier’s license num- ber.

(5) Name and location of vessel ob- taining oil.

(6) Quantity and identification of each type of oil received with date, and signature and title of receiving officer. If all the oil is laden on the receiving vessel at the port of withdrawal via pipeline from the bonded storage tank, paragraphs (a) (3) and (4) of this section shall be deemed to be inapplicable.

(b) If a blanket free withdrawal of bunker fuel oil is filed, to comply with Bureau of the Census requirements the withdrawal on Customs Form 7501 shall be endorsed ‘‘Estimated Withdrawals’’ and limited to the aggregate quantity and value of fuel oil which it is esti- mated will be physically removed from Customs bond during the calendar month in which the withdrawal is filed for lading on vessels entitled to duty- free vessel supplies under section 309 of the Tariff Act of 1930, as amended.

(c)(1) As an incident of the delivery of fuel oils classifiable at different rates of duty to a vessel or vessels under sec- tion 309 of the tariff act, the port direc- tor may, when necessary to enable a supplier to meet fuel specifications, permit the blending of the oils in the delivering conveyance or in other suit- able facilities after withdrawal from the bonded tanks, upon the condition that, to the extent of the amount of oil withdrawn classifiable at the higher rate, duty at the higher rate will be paid on any portion of the blended fuel oil not delivered within a reasonable time to a qualified vessel. The with- drawer shall be required to file a with- drawal for consumption for the excess quantity withdrawn. For example, if the quantity withdrawn consists of 1,500 barrels of bunker C fuel oil classi- fiable at the rate of one-eighth cent per gallon and 500 barrels of diesel oil clas- sifiable at the rate of one-fourth cent per gallon but only 1,400 barrels of the blended oil are actually laden as fuel supplies on qualified vessels, with- drawals for consumption are required for 500 barrels of diesel oil at the high-

er rate and for 100 barrels of bunker C fuel oil at the lower rate.

(2) Delivering transferer receipt. The re- ceipt of the delivering carrier on a copy of Customs Form 7501 for fuel oil which has been blended under paragraph (c)(1) of this section with components classi- fiable at different rates of duty shall show, for each warehouse entry number and withdrawal number involved, the types and quantity of oil received.

(d) Fuel oil withdrawn as vessel sup- plies at one port may be laden at an- other port on a vessel or vessels enti- tled to the free withdrawal privileges of section 309 of the tariff act, under procedures prescribed in this section, provided the movement to the receiv- ing vessel or vessels is under the bond of a qualified carrier as described in § 18.1(a) of this chapter. In such cases, the provisions of § 10.60(d) of this chap- ter shall be deemed inapplicable.

(e) If a vessel not entitled to duty- free withdrawal of supplies from Cus- toms bonded warehouses under section 309 of the Tariff Act of 1930, as amend- ed, should be supplied with fuel oil from a Customs bonded tank described in paragraph (a) of this section because of an emergency, a duty paid with- drawal therefor shall be filed on the first day that the customhouse is open for the general transaction of business after the day on which the oil is laden on the using vessel. If there should be willful or repeated instances of late fil- ing of a duty-paid withdrawal in such cases, the port director shall require a duty-paid withdrawal to be filed prior to the removal of fuel oil from the bonded tank.

(f) When the procedures prescribed in this section are followed, representa- tives of the port director will from time to time verify various with- drawals against all pertinent records, including financial records, of the withdrawers, deliverers, and receivers of the oil. The withdrawer shall main- tain all pertinent records relating to the withdrawal, delivery, or receipt of the fuel oil for 5 years from the date of

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00142 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

133

U.S. Customs and Border Protection, DHS; Treasury § 10.62b

liquidation of the related fuel oil entry.

[T.D. 69–99, 34 FR 6520, Apr. 16, 1969, as amended by T.D. 79–159, 44 FR 31967, June 4, 1979; T.D. 82–204, 47 FR 49367, Nov. 1, 1982; T.D. 95–81, 60 FR 52295, Oct. 6, 1995; T.D. 96– 18, 61 FR 6777, Feb. 22, 1996; T.D. 96–51, 61 FR 31395, June 20, 1996; T.D. 99–33, 64 FR 16347, Apr. 5, 1999]

§ 10.62a Blanket withdrawals for cer- tain merchandise.

(a) Generally. Under this section, a blanket withdrawal on Customs Form 7501 may be filed for all or part of any merchandise withdrawn from ware- house except fuel oil covered under § 10.62, for use on qualified vessels. Such a withdrawal shall be made only for lading on board vessels at the port where the warehouse is located. The procedure for the blanket withdrawal and partial releases after the initial re- lease are the same as those provided in § 19.6(d) of this chapter, except as noted in paragraph (b).

(b) Partial release. A partial release on Customs Form 7501, in duplicate, or in triplicate if an extra copy is required by the port director, shall be presented to the warehouse proprietor and placed in the proprietor’s permit file folder under the partial release procedure set forth in § 19.6(d) of this chapter, as mer- chandise is needed for delivery to a using vessel. The original of the partial release document shall accompany the merchandise for delivery to the Cus- toms officer who will supervise lading, or if a Customs officer does not phys- ically supervise lading, to the master of the vessel. The original shall be re- turned to the proprietor for record pur- poses after the Customs officer or mas- ter of the vessel, as appropriate, has certified lading of the goods described in the document.

[T.D. 82–204, 47 FR 49367, Nov. 1, 1982, as amended by T.D. 95–81, 60 FR 52295, Oct. 6, 1995]

§ 10.62b Aircraft turbine fuel. (a) General. Unless otherwise pro-

vided, aircraft turbine fuel withdrawn from a Customs bonded warehouse for use under section 309, Tariff Act of 1930, as amended (19 U.S.C. 1309), may be commingled with domestic or other aircraft turbine fuel after such with-

drawal only if such commingling is ap- proved by the appropriate Customs of- ficial for the port where the commin- gling occurs. The appropriate Customs official may approve such commingling if the fueling system in which the com- mingling will occur contains adequate physical safeguards to prevent the pos- sible unauthorized entry into the Cus- toms territory of the bonded fuel. Such commingled fuel must be accounted for in the same 24-hour period in which it was commingled and must be—

(1) Exported within that 24-hour pe- riod;

(2) Used under section 309 within that 24-hour period; or

(3) Entered or withdrawn for con- sumption, with duty deposited, as re- quired under the applicable regulations (see part 144 of this chapter).

(b) Duty-free withdrawal from ware- house of aircraft turbine fuel under sec- tion 557(a), Tariff Act of 1930, as amended (19 U.S.C. 1557(a)). Turbine fuel in- tended for use as supplies on aircraft under section 309, Tariff Act of 1930, as amended, and withdrawn from a Cus- toms bonded warehouse shall be enti- tled to the privileges provided for in section 309 if an amount equal to or ex- ceeding the quantity of such fuel is es- tablished, as provided for in paragraph (c) of this section, to have been used on aircraft qualifying for the privileges provided for in section 309 within 30 days after the withdrawal of the fuel from the Customs bonded warehouse. Withdrawal of aircraft turbine fuel under this paragraph shall be in ac- cordance with the procedures in §§ 10.59 through 10.64, unless otherwise pro- vided in this section. Withdrawals under this paragraph shall be anno- tated with the term ‘‘Withdrawal under 19 CFR 10.62b(b)’’.

(c) Establishment of use of fuel by qualifying aircraft. (1) The person with- drawing aircraft turbine fuel under paragraph (b) of this section must es- tablish that an aircraft qualifying for the privileges provided for in section 309, Tariff Act of 1930, as amended, used fuel in an amount equal to or exceeding the quantity of the fuel withdrawn that is not entered and upon which duties are not paid by submitting to Customs, at the port where the bonded ware- house entry was filed, within the time

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00143 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

134

19 CFR Ch. I (4–1–12 Edition)§ 10.62b

provided in paragraph (d) of this sec- tion, either—

(i) Records prepared in the normal course of business effecting the trans- fer to identified (e.g., by aircraft com- pany name, flight number, flight origin and destination, and date of flight) air- craft of fuel in an amount equal to or exceeding the quantity of the fuel withdrawn which is not entered and on which duties are not paid and objective evidence that the aircraft to which the fuel was transferred were actually used in trade qualifying for the privileges provided in section 309, Tariff Act of 1930, as amended; or

(ii) A certification (documentary or electronic) that:

(A) All of the fuel withdrawn was in- tended for use on aircraft entitled to the privileges provided for in section 309;

(B) Within 30 days of the date of withdrawal from warehouse, an amount of fuel equal to or exceeding the quantity of the fuel withdrawn which is not entered and on which du- ties are not paid was transferred as supplies to aircraft entitled to the privileges provided for in section 309;

(C) All of the aircraft into which fuel is loaded hereunder were used in a trade provided for in section 309; and

(D) The person making the certifi- cation possesses evidence (documen- tary or electronic) available for Cus- toms inspection at a named place which supports each of the above state- ments.

(2) Upon request by Customs, the per- son who submits the certification pro- vided for in paragraph (c)(1) of this sec- tion shall promptly provide the evi- dence required to support the claim for treatment under this section (including the records described in § 10.62b(c)(1)(i)) and §§ 10.62 and 19.6(d) and each of the statements in the certification.

(d) Time for establishment of use of fuel by qualifying aircraft. The person with- drawing aircraft turbine fuel under paragraph (b) of this section shall sub- mit the records or certification pro- vided for in paragraph (c) of this sec- tion by the 40th day after the date of withdrawal of the fuel unless the fuel was withdrawn under a blanket with- drawal under paragraph (g) of this sec- tion. If the fuel was withdrawn under a

blanket withdrawal, the person with- drawing aircraft turbine fuel under this section shall submit the records or cer- tification provided for in paragraph (c) of this section by the 40th day after all of the fuel covered by the blanket per- mit to withdraw has been withdrawn.

(e) Treatment of turbine fuel withdrawn but not used on qualifying aircraft within 30 days. If turbine fuel is withdrawn from a Customs bonded warehouse under paragraph (b) of this section but fuel in an amount less than the quan- tity withdrawn is established to have been used within 30 days of the date of withdrawal from warehouse on aircraft qualifying for the privileges provided for in section 309, Tariff Act of 1930, as amended, a withdrawal for consump- tion shall be filed and duties shall be deposited for the excess of fuel so with- drawn over that used on aircraft so qualifying. Such withdrawal shall be filed and such duties shall be deposited by the 40th day after the date of with- drawal of the fuel in accordance with the procedures in § 144.38 of this chap- ter. Interest shall be payable and de- posited with such duties, calculated from the date of withdrawal at the rate of interest established under 26 U.S.C. 6621.

(f) Liquidated damages. Failure to ac- count for turbine fuel withdrawn under paragraphs (b) through (h) of this sec- tion shall result in liquidated damages against the person withdrawing the turbine fuel, as provided for under § 113.62 of this chapter. Such failure to account for turbine fuel includes:

(1) The failure to timely file the withdrawal for consumption and pay- ment of duty, with interest, on the quantity of fuel so withdrawn in excess of the quantity of fuel established to have been used on qualifying aircraft within 30 days of withdrawal, as pro- vided for in paragraph (e) of this sec- tion;

(2) The failure to timely file the evi- dence or certification establishing such use of the fuel which is not entered and on which duties are not paid, as pro- vided for in paragraph (c) of this sec- tion; or

(3) The failure to promptly provide the evidence required to support the claim for treatment under paragraph

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00144 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

135

U.S. Customs and Border Protection, DHS; Treasury § 10.63

(b) of this section, upon request by Cus- toms, as provided for in paragraph (c)(2) of this section.

(g) Blanket withdrawals. Blanket withdrawals, as provided for in §§ 10.62 and 19.6(d), may be used for with- drawals from warehouse under section 557(a), Tariff Act of 1930, as amended, and paragraphs (b) through (h) of this section, under the procedures provided in §§ 10.62 and 19.6(d) except that—

(1) Application by the withdrawer for a blanket permit to withdraw shall be on the warehouse entry, or on the warehouse entry/entry summary when used as an entry, annotated with the words ‘‘Some or all of the merchandise will be withdrawn under blanket per- mit per §§ 10.62, 10.62b, and 19.6(d).’’;

(2) Turbine fuel withdrawn under a blanket permit as authorized in this paragraph may be delivered at a port other than the port of withdrawal;

(3) Customs acceptance of a properly completed application for a blanket permit to withdraw, on the warehouse entry or warehouse entry/entry sum- mary, will constitute approval of the blanket permit to withdraw;

(4) A copy of the approved blanket permit to withdraw will be delivered to the warehouse proprietor, whereupon fuel may be withdrawn under the terms of the blanket permit;

(5) The withdrawal document to be placed in the proprietor’s permit file folder (see § 19.6(d)(2)) will be a com- mercially acceptable document of re- ceipt (such as a ‘‘withdrawal ticket’’) issued by the warehouse proprietor, identified with a unique alpha-numeric code and containing the following in- formation:

(i) Identity of withdrawer; (ii) Identity of warehouse and tank

from which fuel is withdrawn; (iii) Date of withdrawal; (iv) Type of merchandise withdrawn;

and (v) Quantity of merchandise with-

drawn. (6) The date of withdrawal, for pur-

poses of calculating the 30-day period in which fuel must be used on quali- fying aircraft under this section, shall be the date on which physical removal of the fuel from the warehouse com- mences;

(7) The blanket permit summary pre- pared by the proprietor as provided for in § 19.6(d)(4) shall be prepared when all of the fuel covered by the blanket per- mit has been withdrawn and shall ac- count for all merchandise withdrawn under the blanket permit, as required by § 19.6(d)(4), by stating, in summary form, the unique alpha-numeric codes and information required in paragraph (g)(5) of this section, as well as the identity of the warehouse entry to which the withdrawal is attributed;

(8) The certification on the blanket permit summary (see § 19.6(d)(4)) shall be that the merchandise listed there- under was withdrawn in compliance with §§ 10.62, 10.62b, and 19.6(d); and

(9) The person withdrawing aircraft turbine fuel under these blanket proce- dures shall submit the records or cer- tification provided for in § 10.62b(c) by the 40th day after all of the fuel cov- ered by the blanket permit has been withdrawn (see § 10.62b(d)). At the dis- cretion of the port director for the port where blanket withdrawal was ap- proved, submission of the records and evidence required to establish use of the fuel on qualifying aircraft may be required to be submitted electroni- cally, in a format compatible with Cus- toms electronic record-keeping sys- tems.

(h) Recordkeeping. The person with- drawing aircraft turbine fuel from warehouse under this section is subject to the recordkeeping requirements in 19 U.S.C. 1508 and 1509, as provided for in part 162 of this chapter.

[T.D. 96–18, 61 FR 6778, Feb. 22, 1996, as amended by T.D. 99–33, 64 FR 16347, Apr. 5, 1999]

§ 10.63 Landing of supplies and stores from receiving vessel in the United States.

Supplies or stores laden on a vessel duty and tax free under section 309, Tariff Act of 1930, as amended, may be landed under Customs supervision under proper permit, the same as if they had been laden in a foreign coun- try. See § 4.39 of this chapter. Except when transfer to another vessel enti- tled to the free withdrawal privilege is permitted under the original with- drawal under section 309, Tariff Act of 1930, as amended, the landed articles

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00145 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

136

19 CFR Ch. I (4–1–12 Edition)§ 10.64

shall be treated as an importation from a foreign country.

[28 FR 14663, Dec. 31, 12963, as amended by T.D. 89–1, 53 FR 51250, Dec. 21, 1988; T.D. 97– 82, 62 FR 51769, Oct. 3, 1997]

§ 10.64 Crediting or cancellation of bonds.

(a) Except as stated below, a bond on Customs Form 301, containing the bond conditions set forth in § 113.62 of this chapter may be credited or canceled in respect of such articles upon the ves- sel’s departure from the port of lading in a class of trade or business entitling the articles to exemption from duty and tax under the statute. The with- drawer shall cause the merchandise to be delivered to the lading vessel, and shall provide such evidence of lading as required by the port director within 30 days after lading, except as provided in this section. If the vessel is not oper- ated by the United States and proceeds in ballast from the port where the arti- cles are laden to another port to lade passengers or cargo for carriage in a class of trade specified in section 309, Tariff Act of 1930, as amended, the bond may be credited or canceled upon the filing with the director of the port of withdrawal within 3 months after the date of withdrawal of a proper declara- tion as prescribed below. The declara- tion shall be executed by one of the fol- lowing who has knowledge of the facts:

(1) The operations manager or port captain for the vessel on which the ar- ticles are laden but not a representa- tive of the supplier.

(2) The master or other officer of the vessel on which the articles are laden. The declaration shall be in substan- tially the following form:

I, ————————————————————— (Operations manager, port captain, master, or other officer) of the vessel llllll de- clare that I have knowledge of the facts set forth herein, and that upon the lading of the articles described below covered by with- drawal No. llll, filed at llllllll(Name of port), the vessel then proceeded in ballast to llllllll(Name of port) to lade cargo or passengers; that the vessel was suitable for service in the class of trade checked below with fittings, outfit, and equipment for such trade already installed when it so departed in ballast; and that upon arrival it proceeded to engage in the carriage of cargo

or passengers in such trade, except as stated below: llllllllllllllllllllllll

(If no exception, note ‘‘None’’)

1. Foreign Trade. 2. Trade between Atlantic and Pacific ports

of the United States, when such trade is not prohibited by coastwise laws.

3. Trade between the United States and any of its possessions, when such trade is not prohibited by coastwise laws.

4. Trade between Alaska or Hawaii and any other part of the United States, when such trade is not prohibited by coastwise laws.

Description of articles: llllllllllllllllllllllll

llllllllllllllllllllllll

llllllllllllllllllllllll

llllllllllllllllllllllll

———————————— (Name and title)

(b) A declaration as to the intended business or trade of a vessel may, in the discretion of the port director, be accepted in lieu of a declaration pre- scribed in paragraph (a) of this section when the amount of duty or tax, or both, involved in a single lading is less than $100.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 84–213, 49 FR 41166, Oct. 19, 1984]

§ 10.64a [Reserved]

§ 10.65 Cigars and cigarettes. (a) Imported cigars and cigarettes in

bonded warehouse or otherwise in Cus- toms custody, and such articles manu- factured with the use of imported ma- terials in a bonded manufacturing warehouse of class 6, may be with- drawn under section 317, Tariff Act of 1930, as amended, for consumption be- ginning beyond the 3-mile limit or international boundary, as the case may be, (1) on vessels actually engaged in the foreign, intercoastal, or non- contiguous territory trade within the purview of § 10.59(a); (2) on vessels de- parting from the port where the with- drawal is made directly for a foreign port, a port on the opposite coast, or a port in one of the possessions of the United States; or (3) on vessels of war or other governmental activity.

(b) The privilege shall not be granted to vessels stationed in American wa- ters for an indefinite period without

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00146 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

137

U.S. Customs and Border Protection, DHS; Treasury § 10.66

sailing schedules, nor shall it be grant- ed to aircraft of foreign registry of a country for which there is not in effect a finding and advice by the Department of Commerce under section 309(d), Tar- iff Act of 1930, as amended, that such country allows privileges to aircraft registered in the United States sub- stantially reciprocal to those described in section 317, Tariff Act of 1930, as amended. See section 10.59(f).

(c) With the following additions and exceptions, the same procedure shall be followed as in the case of withdrawals under section 309(a), Tariff Act of 1930, as amended.

(1) No bond shall be required in the case of vessels operated by the United States Government.

(2) When a shipping case containing cigars and cigarettes is made up of a number of units, each in a separate package, such units may be withdrawn separately, provided each unit is marked and numbered for identifica- tion and contains not less than 250 ci- gars or 1,000 cigarettes. In the case of imported cigars and cigarettes so packed, only one unit from each ship- ping case shall be opened for examina- tion, unless the port director shall deem it necessary for the protection of the revenue to examine a greater quan- tity. Imported tobacco products on which the duty or internal-revenue tax has been paid may not be withdrawn under section 317, Tariff Act of 1930, as amended, with a drawback of such duty or internal-revenue tax.

(3) When all the units in such ship- ping case are not to be withdrawn at the same time or for use on the same vessel, a blanket withdrawal may be filed for the entire case in lieu of a sep- arate withdrawal for each unit. In such event, the withdrawal shall be retained by the warehouse proprietor until de- livery receipts are obtained for the en- tire quantity covered by the with- drawal, provided the total period of time prior to delivery to the using ves- sel or aircraft does not exceed 5 years. A bond on Customs Form 301, con- taining the bond conditions set forth in § 113.62 of this chapter, when required, shall be filed at the time of or prior to the removal of any of the merchandise from the warehouse for delivery to the vessel on which it is to be used.

(4) Merchandise for which blanket withdrawals are filed shall be stored in a separate room or enclosure in a bond- ed warehouse under separate locks, and the merchandise clearly marked to show that it has been withdrawn. If, at the time of any such inventory, any merchandise is missing and not prop- erly accounted for, duties shall be paid thereon before any further withdrawals are permitted.

(5) The declaration of use, when re- quired, shall include a statement that consumption of the articles covered by the withdrawal did not begin until the withdrawing vessel or aircraft had pro- ceeded beyond the 3 mile limit or the international boundary.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 67–193, 32 FR 11764, Aug. 16, 1967; T.D. 70– 73, 35 FR 5400, Apr. 1, 1970; T.D. 82–204, 47 FR 49368, Nov. 1, 1982; T.D. 84–213, 49 FR 41166, Oct. 19, 1984; T.D. 89–1, 53 FR 51250, Dec. 21, 1988]

ARTICLES EXPORTED FOR EXHIBITION, ETC.

§ 10.66 Articles exported for temporary exhibition and returned; horses ex- ported for horse racing and re- turned; procedure on entry.

(a) In connection with the entry of articles, including livestock or other animals, exported for temporary exhi- bition and returned and claimed to be exempt from duty under subheading 9801.00.50 or 9801.00.60, Harmonized Tar- iff Schedule of the United States (HTSUS), there shall be filed:

(1) A certificate of exportation on Customs Form 3311;

(2) A declaration of the importer on Customs Form 4455 for articles of ei- ther domestic or foreign origin; and

(3) In the case of animals of foreign origin taken abroad for exhibition in connection with a circus or menagerie, a copy of an inventory of these animals filed prior to their leaving the country with the director of the port of their departure.

(b) If it is shown to be impracticable to produce the certificate of expor- tation required under paragraph (a)(1) of this section, the port director may accept other satisfactory evidence of exportation, or may take a bond on Customs Form 301, containing the bond conditions set forth in § 113.62 of this

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00147 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

138

19 CFR Ch. I (4–1–12 Edition)§ 10.67

chapter to secure the production of such certificate or other evidence.

(c) Articles claimed to be exempt from duty under subheading 9801.00.50 or 9801.00.60, Harmonized Tariff Sched- ule of the United States (HTSUS) (19 U.S.C. 1202), may be returned free of duty without formal entry and without regard to the requirements of para- graph (a) or (b) of this section if:

(1) Prior to the exportation of such articles, an application on Customs Form 4455 (accompanied by an appro- priate inventory, when required by law or by the port director) is filed with a declaration thereon that:

(i) Any right to drawback of Customs duties with respect to that shipment was waived;

(ii) Any internal revenue tax due has been paid and no refund thereof will be sought; and

(iii) The merchandise was identified, registered, and exported in accordance with the regulations set forth in §§ 10.8(e), (g), (h), and (i), governing the exportation of articles sent abroad for repairs, and

(2) Upon return, a duplicate Customs Form 4455 (with accompanying inven- tory where one was required) is filed.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 74–242, 39 FR 33794, Sept. 20, 1974; T.D. 75–235, 40 FR 44319, Sept. 26, 1975; T.D. 78–153, 43 FR 23709, June 1, 1978; T.D. 82–224, 47 FR 53727, Nov. 29, 1982; T.D. 84–213, 49 FR 41166, Oct. 19, 1984; T.D. 87–75, 52 FR 20066, May 29, 1987; T.D. 89–1, 53 FR 51250, Dec. 21, 1988; T.D. 94–1, 58 FR 69470, Dec. 30, 1993]

§ 10.67 Articles exported for scientific or educational purposes and re- turned; procedure on entry.

(a) In connection with each entry of articles exported for scientific or edu- cational purposes and returned under subheading 9801.00.40, Harmonized Tar- iff Schedule of the United States (HTSUS), the following shall be re- quired, irrespective of the value of the shipment:

(1) A certificate of exportation on Customs Form 3311;

(2) A declaration by the foreign ship- per in the same form as that prescribed in § 10.66(a)(2) but stating that such ar- ticles were sent from the United States solely for temporary scientific or edu- cational use and describing the specific

use to which they were put while abroad.

(3) A declaration of the ultimate con- signee in substantially the following form:

Port of llllllll, Port Director’s Of- fice, lllllllll, 19ll.

I, llllllllll, declare that the sev- eral articles described in the annexed entry are, to the best of my knowledge and belief, the identical articles exported from the United States on the llllll day of llllll, 19ll, by lllllllll (Ac- tual shipper) address llllllll, for the account of llllllll, address llllllllthat they are returned to llllllll, address llllllll, for the account of llllllll, address lllllll that the said articles were ex- ported solely for temporary scientific or edu- cational purposes and for no other use abroad than for exhibition, examination, or experimentation; that they are being re- turned without having been changed in con- dition in any manner, except by reason of their bona fide use as follows: llllllllllllllllllllllll

(Describe change in condition) llllllllllllllllllllllll

———————————— (Ultimate consignee)

(b) If it is shown to be impracticable to produce the certificate of expor- tation required by paragraph (a)(1) of this section, the port director may ac- cept other satisfactory evidence of ex- portation. The port director may take a bond on Customs Form 301, con- taining the bond conditions set forth in § 113.62 of this chapter to secure the subsequent production of any of the evidence or documents required by paragraph (a) of this section which are not available at the time of entry.

(c) If, prior to the exportation of arti- cles claimed to be exempt from duty under subheading 9801.00.40, Har- monized Tariff Schedule of the United States (HTSUS), an application on Cus- toms Form 4455 (accompanied by an ap- propriate inventory when, in the dis- cretion of the port director, such in- ventory is deemed necessary) was filed, such articles may be returned for the account of the exporter free of duty without formal entry, without regard to the requirements of paragraphs (a) and (b) of this section, upon the filing of the duplicate Customs Form 4455 (with accompanying inventory, if one was required), and a declaration of the

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00148 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

139

U.S. Customs and Border Protection, DHS; Treasury § 10.68

ultimate consignee in substantially the form set forth in paragraph (a)(3) of this section.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 74–242, 39 FR 33794, Sept. 20, 1974; T.D. 84–213, 49 FR 41166, Oct. 19, 1984; T.D. 89–1, 53 FR 51250, Dec. 21, 1988; T.D. 94–1, 58 FR 69470, Dec. 30, 1993; T.D. 97–82, 62 FR 51769, Oct. 3, 1997]

THEATRICAL EFFECTS, MOTION-PICTURE FILMS, COMMERCIAL TRAVELERS’ SAM- PLES, AND TOOLS OF TRADE

§ 10.68 Procedure.

(a) Theatrical scenery, properties, and effects, motion-picture films (in- cluding motion-picture films taken aboard a vessel for exhibition only dur- ing an outward voyage and returned for the same purpose during an inward voyage on the same or another vessel), commercial travelers’ samples, and professional books, implements, instru- ments, and tools of trade, occupation, or employment (see § 148.53 of this chapter), of domestic or foreign origin, taken abroad may be returned without formal entry and without payment of duty if an exportation voucher from a carnet, when applicable, or an applica- tion on Customs Form 4455 was filed, and the merchandise was identified as set forth in § 10.8, before exportation of the articles. Articles exported under cover of an A.T.A. carnet (where the carnet serves as the control document) may, in accordance with this para- graph, be returned without entry or the payment of duty. If Customs Form 4455 is utilized, commercial travelers’ sam- ples, professional books, implements, instruments, and tools of trade, occu- pation, or employment may be re- turned with either an informal entry or a declaration on Customs Form 3299; theatrical scenery, properties, and ef- fects and motion-picture films may be returned only with an informal entry. When articles other than those ex- ported by mail or parcel post are exam- ined and registered at one port and ex- ported through another port, the port director may require proof of expor- tation in those cases where the carnet or Customs Form 4455 does not reflect that these articles were exported under Customs supervision. In the case of commercial travelers’ samples taken

abroad for temporary use, except where exportation involves certification of a carnet, port directors may waive exam- ination of the samples at the time of exportation. When motion-picture films are to be taken aboard a vessel for exhibition only during an outward voyage and are to be returned for the same purpose during an inward voyage on the same or another vessel, port di- rectors may waive examination and su- pervision at the time of exportation. When theatrical scenery, properties, and effects are taken abroad in sealed carload lots by rail for temporary use, the cars must be sealed by U.S. Cus- toms officers for entry at any Canadian or Mexican port where U.S. Customs officers are stationed. Application and examination before the time of expor- tation is waived if a Customs Form 4455 is filed with the U.S. Customs officer in the appropriate Canadian or Mexican port, and that officer examines the ar- ticles before they are released from for- eign customs custody by the foreign customs officer.

(b) When any such articles are to be returned to the United States from a contiguous foreign country in which a United States Customs officer is sta- tioned, the articles may be presented to such officer with the duplicate copy of the application for examination and comparison with the descriptive list. Upon completion of such examination, the packages containing the articles shall be corded and sealed or forwarded in cars sealed by Customs officers and shall be manifested in the same man- ner as personal baggage. Articles so treated shall be released upon arrival in the United States and removal of the seals by Customs officers.

(c) When commercial travelers’ sam- ples consisting of raw cotton are taken to and returned from Canada, the ap- plication on Customs Form 4455 shall be executed in triplicate, two copies thereof to be returned to the traveler for surrender to the Customs officer on the return of the samples from Canada.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 69–146, 34 FR 9801, June 25, 1969; T.D. 75– 41, 40 FR 6646, Feb. 13, 1975; T.D. 82–49, 47 FR 12160, Mar. 22, 1980; T.D. 82–116, 47 FR 27261, June 24, 1982]

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00149 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

140

19 CFR Ch. I (4–1–12 Edition)§ 10.69

§ 10.69 Samples to Great Britain and Ireland under reciprocal agree- ment.

Descriptive lists of samples taken to Great Britain and Ireland by commer- cial travelers of the United States under the joint declarations of Decem- ber 3 and 8, 1910 (State Department treaty series 552), shall be required in triplicate, verified by the affidavit of the commercial traveler before a Cus- toms officer, and shall show that the samples are for use as models or pat- terns for the purpose of obtaining or- ders and not for sale and that the lists contain a full description of the arti- cles. One copy shall be retained and the others shall be delivered to the com- mercial traveler—one for the identi- fication of the samples on their return to the United States and one for the use of the foreign customs authorities. The latter copy must have been at- tested by a consular officer of the country concerned in the United States.

ANIMALS AND BIRDS

CROSS REFERENCE: For regulations with re- spect to recognition of breeds and purebred animals, see 9 CFR part 151.

§ 10.70 Purebred animals for breeding purposes; certificate.

(a) In connection with the entry of purebred animals for breeding purposes under subheading 0101.11.00, Har- monized Tariff Schedule of the United States (HTSUS), no claim for free entry shall be allowed in liquidation of the entry until the port director has received from the Department of Agri- culture a certificate that the animal is purebred of a recognized breed and duly registered in a book of record recog- nized by the Secretary of Agriculture for that breed. Importers are required by regulation of the Department of Ag- riculture to make application for a cer- tificate of pure breeding to the U.S. De- partment of Agriculture, Animal and Plant Health Inspection Service, Vet- erinary Services, on ANH Form 17–338 before the animal will be examined as required by 9 CFR 151.7. Application for the certificate must be executed by the owner agent, or importer and filed at a port of entry designated in the regula-

tions of the Department of Agriculture for the importation of animals (9 CFR 92.3). However, applications for certifi- cates for dogs (other than dogs for han- dling livestock regulated under 9 CFR 92.18) and cats may be filed either at a designated port of entry or at any other port where Customs entry is made. The regulations of the Depart- ment of Agriculture prescribing the re- quirements for the issuance of certifi- cates of pure breeding provide that all animals imported under such regula- tions must be accompanied to the port at which examination is to be made by certificates of pedigree and transfer of ownership in order that identification may be accomplished, and that, if such animals are moved from such port prior to the presentation of such cer- tificates and transfers, such action shall constitute a waiver of any further claim to certification under such regu- lations.

(b) In the cases of cats and dogs ar- riving at Canadian border ports, Cus- toms officers and employees are hereby authorized and directed to make the examination required by such regula- tions of the Department of Agriculture. Customs officers and employees are also authorized and directed to make such examinations at the ports of New York and Boston, provided the dog or cat is brought into the United States by a passenger. At all airports, Cus- toms officers shall make the examina- tion of dogs and cats, whether or not accompanied by the owners, if there is no inspector of the Department of Ag- riculture stationed there or on duty at the time of arrival.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 68–154, 33 FR 8730, June 14, 1968; T.D. 78– 99, 43 FR 13060, Mar. 29, 1978; T.D. 87–75, 52 FR 20066, May 29, 1987; T.D. 89–1, 53 FR 51250, Dec. 21, 1988]

§ 10.71 Purebred animals; bond for production of evidence; deposit of estimated duties; stipulation.

(a) The animal may be released from Customs custody upon the furnishing by the importer of a bond on Customs Form 301, containing the bond condi- tions set forth in § 113.62 of this chapter for the production within 6 months of (1) a certificate of pure breeding issued by the Department of Agriculture, and

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00150 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

141

U.S. Customs and Border Protection, DHS; Treasury § 10.75

(2) the declaration required by § 10.70(a) submitted in letter form if such dec- laration was not filed at the time of entry. The release of the animal from customs custody requires the presen- tation of the pedigree certificate and evidence of transfer of ownership in ac- cordance with the regulations of the Department of Agriculture mentioned in § 10.70(b).

(b) Charges against the bond shall be canceled only upon the production of the required evidence or on payment of duties.

(c) In cases where the pedigree cer- tificate and evidence of transfer of ownership have been presented in ac- cordance with the regulations of the Department of Agriculture, the im- porter, if he so elects, may, in lieu of giving a bond, deposit estimated duties and file a stipulation with the port di- rector within 10 days after the date of entry to produce the declaration and certificate of pure breeding within 6 months from the date of entry, where- upon the liquidation of the entry shall be suspended. (See § 113.42 of this chap- ter.)

(d) If the pedigree certificate and evi- dence of transfer of ownership were not presented in accordance with such reg- ulations of the Department of Agri- culture, a deposit of estimated duties, in addition to the regular entry bond, shall be required.

(e) When a passenger arriving in the United States with one or more dogs or cats and with the required certificates of pedigree and transfers of ownership in his possession furnishes a properly executed declaration as required by § 10.70(a) along with an application to the Department of Agriculture on ANH Form 17–338 for a certificate of pure breeding, the entry of the animal(s) as duty-free under subheading 0106.00.50, Harmonized Tariff Schedule of the United States (HTSUS), may be made on the passenger’s baggage declaration if the value of the animals does not ex- ceed $500. In such case the entry shall be supported by a bond on Customs Form 301, containing the bond condi- tions set forth in § 113.62 of this chapter for the production within 6 months of a certificate of pure breeding. The bond shall be without surety or cash deposit unless the port director on the basis of

information before him finds that a bond with surety or a cash deposit is necessary to protect the revenue.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 68–79, 33 FR 4461, Mar. 13, 1968; T.D. 68– 154, 33 FR 8731, June 14, 1968; T.D. 74–227, 39 FR 32015, Sept. 4, 1974; T.D. 78–99 43 FR 13060, Mar. 29, 1978; T.D. 84–213, 49 FR 41166, Oct. 19, 1984; T.D. 87–75, 52 FR 26142, July 13, 1987; T.D. 89–1, 53 FR 51250, Dec. 21, 1988; T.D. 93– 66, 58 FR 44130, Aug. 19, 1993]

§§ 10.72–10.73 [Reserved]

§ 10.74 Animals straying across bound- ary for pasturage; offspring.

When domestic animals for which free entry is to be claimed under sub- heading 9801.00.90, Harmonized Tariff Schedule of the United States, have strayed across the boundary line, they may be returned, together with their offspring, without entry if brought back within 30 days; otherwise entry shall be required. The owner of any such animal shall report its return to the nearest Customs office and hold it for such inspection and treatment as may be deemed necessary by a rep- resentative of the Animal and Plant Health Inspection Service of the De- partment of Agriculture. Any such ar- rival found not to have been so re- ported or held shall be subject to sei- zure and forfeiture pursuant to 18 U.S.C. 545.

[T.D. 87–75, 52 FR 20067, May 29, 1987, as amended by T.D. 89–1, 53 FR 51250, Dec. 21, 1988]

§ 10.75 Wild animals and birds; zoolog- ical collections.

When wild animals or birds are claimed to be free of duty under sub- heading 9810.00.70, Harmonized Tariff Schedule of the United States (HTSUS), (19 U.S.C. 1202), the port di- rector may, at his discretion, require appropriate proof that the animals or birds were specially imported pursuant to negotiations conducted prior to im- portation for the delivery of animals or birds of a named species meeting agreed specifications of reasonable par- ticularity and that they are intended at the time of importation for public exhibition in a collection maintained for scientific or educational purposes and not for sale or for use in connec- tion with any enterprise conducted for

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00151 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

142

19 CFR Ch. I (4–1–12 Edition)§ 10.76

profit. The fact that an animal or bird may have been sent on approval shall not preclude free entry under sub- heading 9810.00.70, HTSUS, when it is actually accepted as a part of the zoo- logical collection and so exhibited.

[T.D. 85–123, 50 FR 29953, July 23, 1985, as amended by T.D. 89–1, 53 FR 51250, Dec. 21, 1988; T.D. 97–82, 62 FR 51769, Oct. 3, 1997]

§ 10.76 Game animals and birds.

(a) The following classes of live game animals and birds may be admitted free of duty for stocking purposes under the provisions of subheading 9817.00.70 without reference to the United States Customs Service, if the requirements of the Fish and Wildlife Service, De- partment of the Interior, have been complied with.

ANIMALS

1. Cervidae, commonly known as deer and elk.

2. Leporidae, commonly known as rabbits. 3. Sciuridae, commonly known as squirrels.

BIRDS

1. Anatidae, commonly known as ducks and geese.

2. Gallinae, commonly known as turkeys, grouse, pheasants, partridges, and quail.

3. Otididae, commonly known as bustards. 4. Tinamidae, commonly known as

tinamous.

(b) Application for the free entry of other live animals or birds under sub- heading 9817.00.70, Harmonized Tariff Schedule of the United States shall be referred to the United States Customs Service for consideration. Animals im- ported for fur-farming purposes shall not be admitted free of duty under that paragraph.

(c) [Reserved] (d) Game animals and birds killed in

foreign countries by residents of the United States, if not imported for sale or other commercial purposes, may be admitted free of duty without entry, if the person has no merchandise requir- ing a written declaration upon the fil- ing of a declaration on U.S. Fish and Wildlife Service Form 3–177, Declara- tion for Importation or Exportation of Fish or Wildlife. No bond or cash de- posit to insure the destruction or ex-

portation of the plumage of such birds shall be required.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 82–145, 47 FR 35475, Aug. 16, 1982; T.D. 86– 118, 51 FR 22515, June 20, 1986; T.D. 89–1, 53 FR 51250, Dec. 21, 1988; T.D. 90–78, 55 FR 40166, Oct. 2, 1990]

§ 10.77 [Reserved]

PRODUCTS OF AMERICAN FISHERIES

§ 10.78 Entry.

(a) No entry shall be required for fish or other marine products taken on the high seas by vessels of the U.S. or by residents of the U.S. in undocumented vessels owned in the U.S. when such fish or other products are brought into port by the taking vessel or are trans- ferred at sea to another fishing vessel of the same fleet and brought into port.

(b) An American fishery, within the meaning of Subchapter XV of Chapter 98, Harmonized Tariff Schedule of the United States, is defined as a fishing enterprise conducted under the Amer- ican flag by vessels of the United States on the high seas or in foreign waters in which such vessels have the right by treaty or otherwise, to take fish or other marine products and may include a shore station operated in con- junction with such vessels by the owner or master thereof.

(c) The employment of citizens of a foreign country by an American fishery is permissible but the purchase by an American fishery of fish or other ma- rine products taken by citizens of a for- eign country on the high seas or in for- eign waters will subject such fish or other marine products to treatment as foreign merchandise.

(d) Products of an American fishery shall be entitled to free entry although prepared, preserved, or otherwise changed in condition, provided the work is done at sea by the master or crew of the fishery or by persons em- ployed by and under the supervision of the master or owner of the fishery. Fish (except cod, haddock, hake, pol- lock, cusk, mackerel, and swordfish) the product of an American fishery landed in a foreign country and there not further advanced than beheaded, eviscerated, packed in ice, frozen and with fins removed, shall be entitled to

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00152 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

143

U.S. Customs and Border Protection, DHS; Treasury § 10.84

free entry, whether or not such proc- essing is done by the American fishery. Products of an American fishery pre- pared or preserved on the treaty coasts of Newfoundland, Magdalen Islands, or Labrador, as such coasts are defined in the Convention of 1818 between the United States and Great Britain, shall be entitled to free entry only if the preparation or preservation is done by an American fishery.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 87–75, 52 FR 20067, May 29, 1987; T.D. 89– 1, 53 FR 51250, Dec. 21, 1988]

§ 10.79 [Reserved]

SALT FOR CURING FISH

§ 10.80 Remission of duty; withdrawal; bond.

Imported salt in bond may be used in curing fish taken by vessels licensed to engage in the fisheries, and in curing fish in the shores of the navigable wa- ters of the U.S., whether such fish are taken by licensed or unlicensed vessels, and upon proof that the sale has been used for either of such purposes, the duties on the same shall be remitted. (Section 313(e), Tariff Act of 1930, 19 U.S.C. 1313(e)). Imported salt entered for warehouse may be withdrawn under bond for use in curing fish. Upon proof that the salt has been so used, the du- ties thereon shall be remitted. In no case shall the quantity of salt with- drawn exceed the reasonable require- ments of the case. Withdrawal shall be made on Customs Form 7501. Each withdrawal shall contain the state- ment prescribed for withdrawals in § 144.32 of this chapter. When the with- drawal is made by a person other than the importer of record, a bond on Cus- toms Form 301, containing the bond conditions set forth in § 113.62 of this chapter for the production of proof of proper use shall be filed. Upon accept- ance of the bond, a withdrawal permit shall be issued on Customs Form 7501.

[T.D. 89–1, 53 FR 51251, Dec. 21, 1988, as amended by T.D 95–81, 60 FR 52295, Oct. 6, 1995]

§ 10.81 Use in any port. (a) Salt withdrawn under bond for

use in curing fish on the shores of navi- gable waters may be used for such pur-

pose at any port, but the evidence of use in such cases shall be submitted through the director of the port where the salt was used.

(b) If desired, salt to be used in cur- ing fish on shore at another port than that in which it is warehoused in bond may be withdrawn under a transpor- tation entry and shipped in bond to the other port at which it is to be used, where it may be entered on Customs Form 7501 which shall show withdrawal of the salt for use in curing fish. There- upon, and upon the filing of a bond on Customs Form 301, containing the bond conditions set forth in § 113.62 of this chapter, such salt may be used without being sent to a bonded warehouse or public store. In such a case the proof of use shall be filed at the latter port.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 84–213, 49 FR 41166, Oct. 19, 1984; T.D. 87– 75, 52 FR 20067, May 29, 1987; T.D 95–81, 60 FR 52295, Oct. 6, 1995]

§ 10.82 [Reserved]

§ 10.83 Bond; cancellation; extension. (a) If it shall appear to the satisfac-

tion of the port director holding the bond referred to in § 10.80, that the en- tire quantity of salt covered by the bond has been duly accounted for, ei- ther by having been used in curing fish or by the payment of duty, the port di- rector may cancel the charges against the bond. The port director may re- quire additional evidence in corrobora- tion of the proof of use produced.

(b) On application of the person mak- ing the withdrawal, the period of the bond may be extended 1 year so as to allow the salt to be used during the time of extension in curing fish with the same privileges as if used during the original period.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 87–75, 52 FR 20067, May 29, 1987]

AUTOMOTIVE PRODUCTS

§ 10.84 Automotive vehicles and arti- cles for use as original equipment in the manufacture of automotive vehicles.

(a)(1) Certain motor vehicles and motor vehicle equipment are eligible for duty-free entry as proclaimed by the President under the Automotive

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00153 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

144

19 CFR Ch. I (4–1–12 Edition)§ 10.84

Products Trade Act of 1965. The arti- cles designated for such duty-free treatment are defined in General Note 3(c)(iii), HTSUS (19 U.S.C. 1202). Spe- cifically, such articles are those des- ignated [as ‘‘Free (B)’’] in the ‘‘Spe- cial’’ subcolumn in Chapter 87, HTSUS, and must qualify as ‘‘Canadian arti- cles’’ as defined in General Note 3(c)(iii)(A)(1), HTSUS. To claim exemp- tion from duty under the Automotive Products Trade Act of 1965, an im- porter must establish, to the satisfac- tion of the appropriate Customs officer, that the article in question qualifies as a ‘‘Canadian article’’ for purposes of General Note 3(c)(iii)A)(1), HTSUS. The Customs officer may accept as satisfac- tory evidence a certificate executed by the exporter as set forth in paragraph (b) of this section, subject to any verification he may deem necessary. Alternatively, the Customs officer may determine that under the cir- cumstances of the importation a cer- tificate is unnecessary.

(2) Under the United States-Canada Free-Trade Agreement and imple- menting legislation (Pub. L. 100–449, 102 Stat. 1851) a manufacturer of motor ve- hicles may elect to average, over its 12- month financial year, its calculation of the value-content requirement for ve- hicles in establishing its eligibility for tariff preference. Requirements for averaging are set forth in § 10.310 and 10.311.

(b)(1) When all materials used at any stage in the production of the imported article are wholly obtained or produced in Canada or the United States, or both, a certificate in the following form may be accepted as evidence that the commodity is a ‘‘Canadian article’’:

All materials contained in the product cov- ered by the lllll (Describe the invoice, bill of lading, or other document or state- ment identifying the shipment) annexed or appended to this certificate of Canadian ori- gin at the time it was subscribed were whol- ly obtained or produced in Canada or the United States, or both. No materials other than those which were wholly obtained or produced in Canada or the United States, or both, were incorporated into this product or any of its components at any stage of pro- duction or in the production of any inter- mediate product used at any stage in the chain of production in Canada or the United States, or both.

(2) When any material used at any stage in the production of an imported article or any of its components is not wholly obtained or produced in Canada or the United States, or both, a certifi- cate in the following form may be ac- cepted as evidence that the commodity is nevertheless a ‘‘Canadian article’’:

The product covered by the lllll (De- scribe the invoice, bill of lading, or other document or statement identifying the ship- ment) annexed or appended to this certifi- cate of Canadian origin at the time it was subscribed is an originating good so as to be a Canadian article. There were used in its production in Canada lllll (Description sufficient for tariff classification of the ma- terials, and number of units) of third coun- try materials of which the price paid was lllll per unit of quantity, plus lllll which represents all costs incurred in transporting the materials to the location of the producer and the duties, taxes, and brokerage fees on the materials, if such costs were not included in the price paid.

(3) If such Customs officer is satisfied that the revenue will be protected ade- quately thereby, he may accept in lieu of the certificate specified in paragraph (b)(2) of this section a certificate in the following form when the merchandise covered thereby has been produced with third country material but is an originating good under a specific rule of origin for the merchandise:

The product covered by the lllll (De- scribe the invoice, bill of lading, or other document or statement identifying the ship- ment) annexed or appended to this certifi- cate of Canadian origin at the time it was subscribed is an originating good so as to be a Canadian article. There were or may have been used in its production in Canada or the United States, or both, materials of a third country.

It is impractical to ascertain the exact number of units of third country material, if any, used in its production or the price paid (and other costs required to be included in the price paid) of such materials but to the best of (my) (our) (its) knowledge the mate- rials are described (sufficient for tariff clas- sification purposes) as follows: lllll.

(4) The certificates described in para- graphs (b)(2) and (b)(3) of this section shall not be accepted if the statements therein make it evident that the im- portation is not a ‘‘Canadian article’’ within the meaning of General Note 3(c), HTSUS.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00154 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

145

U.S. Customs and Border Protection, DHS; Treasury § 10.90

(5) If more than one kind of article is covered by a certificate provided for in paragraph (b) (1), (2), or (3) of this sec- tion, the information required by the certificate shall be shown with respect to each kind. When more than one kind of material, other than originating ma- terial, is used in the production of an article covered by such a certificate, the certificate shall state the number of units, a description sufficient for tariff classification purposes, the price paid, and, if not included in the price paid, the costs incurred in transporting the materials to the location of the producer and duties, taxes and broker- age fees paid in Canada and/or the United States on the material, per unit of each kind of materials.

(6) A certificate conforming to para- graph (b) (1), (2), or (3) of this section shall be accepted as evidence of the facts alleged therein only if:

(i) There is annexed thereto a copy of the commercial invoice or bill of lading covering the articles or other documen- tary evidence which identifies the arti- cle to which the certificate pertains,

(ii) The certificate is signed by the manufacturer or producer of the article to which it pertains, or by the person who exported the articles from Canada, and

(iii) It clearly appears that such copy or other documentary evidence was an- nexed to the certificate when it was signed.

(c) In lieu of the certification in paragraph (b) (1), (2), or (3) of this sec- tion, a manufacturer of motor vehicles who claims a preference under the United States-Canada Free-Trade Agreement and elects to average pursu- ant to § 10.310(a), shall be subject to the requirements of §§ 10.301 to 10.311 of this part.

(d) When an importer makes an entry, or withdrawal from warehouse, for consumption of articles for use as ‘‘original motor-vehicle equipment’’ as that term is defined in General Note 3(c)(iii), HTSUS, he shall file in con- nection therewith his declaration that the articles are being imported for use as original equipment in the manufac- ture in the United States of the kinds of motor vehicles specified in the Gen- eral Note and furnish the name and ad- dress of the motor vehicle manufac-

turer. A copy of the written order, con- tract, or letter of intent shall be at- tached to the importer’s declaration except that if the port director is satis- fied that a copy of the written order, contract, or letter of intent will be made available by the importer or ulti- mate consignee for inspection by cus- toms officials upon request during a pe- riod of 3 years from the date of such entry or withdrawal from warehouse, the production of such documents will not be required. Proof of use need not be furnished.

(e) If, after a Canadian article has been accorded the status of original motor-vehicle equipment, it is decided to divert the article from its intended use in the manufacture in the United States of motor vehicles, the importer or other person deciding to divert the article from such intended use shall give notice in writing of the decision to the director of the port where entry was made or where the offices of the importer are located and either make arrangements for its destruction or ex- portation under Customs supervision or pay duties in accordance with Gen- eral Note 3(c)(iii)(B)(2), HTSUS. If such article is not destroyed or exported under Customs supervision or the du- ties paid, the article, or its value, shall be subject to forfeiture.

[T.D. 89–3, 53 FR 51765, Dec. 23, 1988, as amended by T.D. 92–8, 57 FR 2453, Jan. 22, 1992; T.D. 93–66, 58 FR 44130, Aug. 19, 1993]

MASTER RECORDS, AND METAL MATRICES

§ 10.90 Master records and metal mat- rices.

(a) Consumption entries covering im- portations under subheading 8524.99.20, HTSUS, shall be filed at a port in the Customs district in which the factory where the articles will be used is lo- cated.

(b) The invoice filed with the entry shall contain or be supported by a de- tailed statement of the cost of produc- tion, in the country where made, of each master record or metal matrix covered thereby.

(c) A bond on Customs Form 301, con- taining the bond conditions set forth in § 113.62 of this chapter shall be filed for importations under this section.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00155 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

146

19 CFR Ch. I (4–1–12 Edition)§ 10.91

(d) Entries already filed and future entries shall be liquidated in due course without the assessment of duty, but liability on bonds given with the entries shall be discontinued with re- spect to any article covered thereby only upon payment of liquidated dam- ages in an amount equal to the duties which would have accrued had the mas- ter records or metal matrices been im- ported for use otherwise than in the manufacture of sound records for ex- port purposes, or upon satisfactory proof that the master records or metal matrices obtained therefrom have been exported or destroyed under Customs supervision, and that all sound records made with the use of such articles have been exported.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 84–213, 49 FR 41166, Oct. 19, 1984; T.D. 87– 75, 52 FR 20067, May 29, 1987; T.D. 89–1, 53 FR 51251, Dec. 21, 1988; T.D. 90–78, 55 FR 40166, Oct. 2, 1990; T.D. 97–82, 62 FR 51769, Oct. 3, 1997]

PROTOTYPES

§ 10.91 Prototypes used exclusively for product development and testing.

(a) Duty-free entry; declaration of use; extension of liquidation—(1) Entry or withdrawal for consumption. Articles de- fined as ‘‘prototypes’’ and meeting the other requirements prescribed in para- graph (b) of this section may be en- tered or withdrawn from warehouse for consumption, duty-free, under sub- heading 9817.85.01, Harmonized Tariff Schedule of the United States (HTSUS), on CBP Form 7501 or an elec- tronic equivalent. A separate entry or withdrawal must be made for a quali- fying prototype article each time the article is imported/reimported to the United States.

(2) Importer declaration. (i) Entry ac- cepted as declaration. Entry or with- drawal from warehouse for consump- tion under HTSUS subheading 9817.85.01 may be accepted by the port director as an effective declaration that the arti- cles will be used solely for the purposes stated in the subheading.

(ii) Proof (declaration) of actual use. If it is believed the circumstances so war- rant, the port director may request the submission of proof of actual use, exe- cuted and dated by the importer. The title of the party executing the proof of

actual use must be set forth. If proof of actual use is requested, the importer must provide it within three years after the date the article is entered or withdrawn from warehouse for con- sumption. Liquidation of the related entry may be extended until the re- quested proof or declaration of actual use is received or until the three-year period from the date of entry allowed for the receipt of such proof has ex- pired. While requested proof of use must be given to CBP within three years of the date of entry, the proto- type may continue to be used there- after for the purposes enumerated in HTSUS subheading 9817.85.01. If re- quested proof of use is not timely re- ceived, the entry will be liquidated as dutiable under the tariff provision that would otherwise apply to the imported article. While there is no particular form for this declaration, it may either be submitted in writing, or electroni- cally as authorized by CBP, and must include the following:

(A) A description of the use that is being and/or that has been made of the articles set forth in sufficient detail so as to enable the port director to deter- mine whether the articles have been entitled to entry as claimed;

(B) A statement that the articles have not and are not to be put to any other use after the articles have been entered or withdrawn from warehouse for consumption and prior to the com- pletion of their use under HTSUS 9817.85.01 (also see paragraphs (c) and (d) of this section concerning the dis- position(s) to which the articles may be put following their use under HTSUS subheading 9817.85.01); and

(C) A statement that the articles or any parts of the articles have not been and are not intended to be sold, or in- corporated into other products that are sold, after the articles have been en- tered or withdrawn from warehouse for consumption and prior to the comple- tion of their use as provided in HTSUS subheading 9817.85.01 (see paragraph (b)(2)(ii) of this section).

(b) Articles classifiable as prototypes— (1) Prototypes defined. In accordance with U.S. Note 6(a) to subchapter XVII of chapter 98, HTSUS, applicable to

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00156 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

147

U.S. Customs and Border Protection, DHS; Treasury § 10.91

subheading 9817.85.01, the term ‘‘proto- types’’ means originals or models of ar- ticles pertaining to any industry that:

(i) Are either in the preproduction, production or postproduction stage and are to be used exclusively for develop- ment, testing, product evaluation, or quality control purposes (not including automobile racing for purse, prize or commercial competition); and

(ii) In the case of originals or models of articles that are either in the pro- duction or postproduction stage, are associated with a design change from current production (including a refine- ment, advancement, improvement, de- velopment or quality control in either the product itself or the means of pro- ducing the product).

(2) Additional requirements. In accord- ance with U.S. Note 6(b) and (c) to sub- chapter XVII of chapter 98, HTSUS, ap- plicable to subheading 9817.85.01, the following additional restrictions apply to articles that may be classified as prototypes:

(i) Importations limited. Prototypes may be imported pursuant to this sec- tion only in limited noncommercial quantities in accordance with industry practice.

(ii) Sale prohibited after entry and prior to use. Prototypes or parts of proto- types may not be sold, or be incor- porated into other products that are sold into the commerce of the United States, after the prototypes have been entered or withdrawn from warehouse for consumption under HTSUS sub- heading 9817.85.01, except that, after having been used for the purposes for which they were entered or withdrawn from warehouse under HTSUS sub- heading 9817.85.01, such prototypes or any part(s) of the prototypes may be sold as scrap, waste, or for recycling, as prescribed in paragraph (c) of this section.

(iii) Articles subject to laws of another agency. Articles that are subject to li- censing requirements, or that must comply with laws, rules or regulations administered by an agency other than CBP before being imported, may be en- tered as prototypes pursuant to this section if they meet all applicable pro- visions of law and otherwise meet the definition of prototypes in paragraph (b)(1) of this section.

(iv) Articles excluded from being proto- types. Articles that are in fact subject at the time of entry to quantitative re- strictions, antidumping orders or coun- tervailing duty orders are excluded from being classified as prototypes under this section.

(c) Sale of prototype following use—(1) Sale. Prototypes or any part(s) of pro- totypes, after having been used for the purposes for which they were entered or withdrawn under HTSUS subheading 9817.85.01, may only be sold as scrap, waste, or for recycling. This includes a prototype or any part thereof that is incorporated into another product, as scrap, waste, or recycled material. If sold as scrap, waste, or for recycling, applicable duty must be paid on the prototypes or parts as provided in para- graph (c)(3) of this section, at the rate of duty in effect for such scrap, waste, or recycled materials at the time the prototypes were entered or withdrawn for consumption.

(2) Notice of sale required. If, after a prototype has been used for the pur- poses contemplated in HTSUS sub- heading 9817.85.01, the prototype or any part(s) of the prototype (including a prototype or any part that is incor- porated into another product) is sold as scrap, waste, or for recycling, the im- porter must provide notice of such sale to the port director where the entry or withdrawal of the prototype was made. A notice, in the manner authorized in paragraph (c)(3) of this section, must be submitted in connection with the sale, whether or not duty is payable. The notice should not be submitted prior to the submission of proof of ac- tual use, should such proof of actual use be requested by the port director (see paragraph (a)(2)(ii) of this section).

(3) Form and content of notice; tender of duty. While no particular form is re- quired for the notice of sale, a con- sumption entry (CBP Form 7501), ap- propriately modified, or an electronic equivalent as authorized by CBP, may be used for this purpose. The notice may be a blanket notice covering all those sales described in paragraph (c)(2) of this section that occur over a quarterly (3-month) calendar period. Such notice must be filed within 10 business days of the end of the related quarterly period in which the sale(s)

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00157 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

148

19 CFR Ch. I (4–1–12 Edition)§ 10.91

occurred. If an article sold is dutiable, the payment of any duty due must be forwarded together with the notice (see paragraph (c)(1) of this section). If the notice is filed electronically, payment of any duty owed will be handled through the Automated Clearinghouse (see § 24.25 of this chapter). The notice of sale must be executed by the im- porter, or other person having knowl- edge of the facts surrounding the sale, and must include the following:

(i) The identity of the prototype; the consumption entry number under which it was imported; a copy of the declaration of actual use, if proof of ac- tual use was requested under paragraph (a)(2)(ii) of this section; and a detailed description of the condition of the pro- totype following use for the intended permissible purposes, including any damage, degradation or deterioration to the article resulting from such use and/or otherwise resulting to the arti- cle from any other cause prior to its sale for scrap, waste, or recycling;

(ii) The name and address of the party to whom the article was sold, and (if known) the use to which the party intends to put the article;

(iii) The HTSUS subheading number for scrap, waste, or recycled material, as applicable, claimed in connection with the sale of the prototype, together with the corresponding rate of duty in effect at the time the prototype was originally imported for consumption;

(iv) The value of the prototype arti- cle (if dutiable and the duty owed is based upon value) (see paragraph (e)(2) of this section); and

(v) The title of the party executing the declaration and the date of execu- tion.

(d) Prototypes not sold following use. As to those prototypes or parts of pro- totypes that, after having been used as prescribed under HTSUS subheading 9817.85.01, are disposed of otherwise than by sale (see paragraph (c)(1) of this section), there is no requirement that the importer notify CBP of any such alternative disposition. Nor are there any dutiable consequences that ensue from any disposition of the mer- chandise after the merchandise’s use under HTSUS subheading 9817.85.01 other than sale to the extent author-

ized under paragraph (c)(1) of this sec- tion.

(e) Recordkeeping; retention and pro- duction—(1) Recordkeeping. The im- porter must be prepared to submit to the CBP officer, if requested, any infor- mation, including any supporting docu- ments, reports and records, as was nec- essary for the preparation of the dec- laration of use, if the declaration of use was requested under paragraph (a)(2)(ii) of this section, and the notice of sale, if applicable under paragraph (c)(3) of this section. The notices, together with any related supporting evidence, may be subject to such verification as the port director reasonably deems nec- essary. Supporting documentary evi- dence must be made available to the CBP officer, upon request, for a period of five years (see § 163.4(a) of this chap- ter) from the date of filing in complete and proper form, the declaration of use, if requested, and, if applicable, the no- tice of sale. The supporting records must be made available to the CBP of- ficer upon request in accordance with § 163.6 of this chapter.

(i) Documents supporting the proof (declaration) of actual use must:

(A) Establish that the identity and description of the prototype article is the same article that the consumption entry was made for under subheading 9817.85.01, HTSUS; and

(B) Describe the circumstances of the use of the article; the operations, test- ing, review, manipulation, experimen- tation, and/or other exercises that are being and/or that have been conducted in connection with the prototype; and the location, such as the plant or pro- duction facility, where these activities occurred, sufficient to demonstrate that the purposes enumerated in HTSUS subheading 9817.85.01 are tak- ing and/or have actually taken place.

(ii) Documents supporting the notice of sale must establish that:

(A) The identity of the prototype sold is the same article for which a con- sumption entry was made under sub- heading 9817.85.01 HTSUS when it was imported, and that the article was in the condition described in the notice of sale;

(B) The article was sold to the party identified in the notice of sale;

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00158 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

149

U.S. Customs and Border Protection, DHS; Treasury § 10.98

(C) The HTSUS subheading number for scrap, waste, or recycled material, as applicable, claimed in connection with the sale of the prototype is accu- rate;

(D) The date that the prototype was originally imported for consumption, and the corresponding rate of duty in effect at the time for the applicable HTSUS subheading; and

(E) The value of the prototype article (if dutiable and the duty owed is based upon value) (see paragraph (e)(2) of this section) as claimed in the notice of sale is accurate.

(2) Relevant value for used prototype or parts sold. For purposes of this section, with respect to any duty owed on pro- totypes or parts of prototypes that are sold as scrap, or waste, or for recy- cling, where the duty owed is based upon value, the relevant value is the market value of the prototypes or parts, based upon their character and condition following use for the pur- poses prescribed in HTSUS subheading 9817.85.01. The relevant value should take into consideration any damage, degradation or deterioration to the prototypes or parts resulting from their use as a prototype and/or other- wise resulting to the articles from any other cause prior to their sale as scrap, waste, or for recycling. The market value will generally be measured by the selling price. Should a prototype or part of a prototype become a compo- nent of another product that is sold as scrap, waste, or recycled material, the relevant market value would be that portion of the selling price attributable to the component (prototype or part) as provided in this paragraph.

(f) Articles admitted under TIB—(1) Duty-free entry available. Under the pro- cedure presented in paragraph (f)(2) of this section, an entry of an article made under a temporary importation bond (TIB) solely for testing, experi- mental or review purposes under HTSUS subheading 9813.00.30 may be converted into a duty-free entry under HTSUS subheading 9817.85.01, if the fol- lowing conditions exist:

(i) The article meets the definition for ‘‘prototypes’’ in paragraph (b) of this section (U.S. Note 6(a) to sub- chapter XVII, chapter 98, HTSUS); and

(ii) The TIB entry for the article was in effect and had not been closed, and the TIB period for the article had not expired, as of November 9, 2000.

(2) Procedure for converting TIB entry to duty-free entry—(i) Importer request. The importer must submit a written request, or an electronic equivalent as authorized by CBP, that a TIB entry made under HTSUS subheading 9813.00.30, which was in effect and had not been closed, and for which the TIB period had not expired, as of November 9, 2000, be converted instead into a duty-free consumption entry under HTSUS subheading 9817.85.01.

(ii) Action by CBP. CBP will convert the TIB entry under HTSUS sub- heading 9813.00.30 to a duty-free entry under HTSUS subheading 9817.85.01, provided that the port director is satis- fied that the conditions set forth in paragraphs (f)(1)(i) and (f)(1)(ii) of this section have been met. When the TIB entry is converted, the bond will be cancelled and the entry closed. Once the conversion is complete, the port di- rector will provide a courtesy acknowl- edgment to this effect to the importer in writing or electronically.

[CBP Dec. 04–36, 69 FR 63449, Nov. 2, 2004]

§§ 10.92–10.97 [Reserved]

FLUXING MATERIAL

§ 10.98 Copper-bearing fluxing mate- rial.

(a) For the purpose of this section, ores usable as a flux or sulphur rea- gent, mentioned in the provision for such ores in subheading 2603.00.00, Har- monized Tariff Schedule of the United States, shall include only ores which contain by weight not over 15 percent copper.

(b) [Reserved] (c) There shall be filed in connection

with the entry of such copper-bearing ores, either for consumption or ware- house, a declaration of the importer that the material is to be used for fluxing purposes only. In the case of a consumption entry, the estimated tax shall be deposited at the time of entry. Liquidation of entries shall be sus- pended pending proof of use for fluxing purposes as hereinafter provided.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00159 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

150

19 CFR Ch. I (4–1–12 Edition)§ 10.99

(d) Samples of the material shall be taken in accordance with the commer- cial method in effect at the plant if to be used in a bonded smelting ware- house, or in accordance with §§ 151.52 through 151.55 of this chapter if entered for consumption, and the copper con- tent thereof shall be determined by the Government chemist in accordance with the assay.

(e) The management of the smelting or converting plant shall file with the appropriate Customs officer at the port or ports where the entries are to be liq- uidated, a statement based on its records of operation for each quarterly period showing for each furnace or con- verter the total quantity of material charged during each month or part thereof of each quarter, the total quan- tity of material used for fluxing pur- poses, and the quantity of imported ores used for fluxing purposes for which free entry was claimed under the above-mentioned provision, together with the copper content of such im- ported ores computed in accordance with the Government assay. If the quantity of ores used for fluxing pur- poses in any furnace or converter dur- ing any month or part thereof of any quarter is in excess of 25 percent of the charge of such furnace or converter, the quarterly statement shall be ac- companied by an explanation of the ne- cessity for using such quantity for fluxing purposes.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 73–175, 38 FR 17445, July 2, 1973; T.D. 87– 75, 52 FR 20067, May 29, 1987; T.D. 89–1, 53 FR 51251, Dec. 21, 1988]

ETHYL ALCOHOL

§ 10.99 Importation of ethyl alcohol for nonbeverage purposes.

(a) If claim is made by an importer other than the United States or a gov- ernmental agency thereof for the clas- sification of ethyl alcohol of an alco- holic strength by volume of 80 percent volume or higher under subheading 2207.10.60, Harmonized Tariff Schedules of the United States, the importer or his agent shall file in connection with the entry a declaration that the alco- hol is to be used for nonbeverage pur- poses only and whether the alcohol is to be used for fuel purposes. Customs

shall release the alcohol for transfer, under internal revenue bond, to a dis- tilled spirits plant upon deposit of esti- mated duty, if any, and without the payment of the internal revenue tax upon receipt of a transfer record for bulk spirits. In addition, a package gauge record must be submitted to Customs if the alcohol is in packages, as specified in subpart I of part 251, Bu- reau of Alcohol, Tobacco and Firearms (BATF) Regulations (27 CFR part 251, subpart I). The transfer shall be accom- plished in accordance with subpart L of part 251, Bureau of Alcohol, Tobacco and Firearms Regulations (27 CFR part 251, subpart L).

(b) An appropriate BATF permit shall be filed with Customs in connec- tion with the withdrawal of ethyl alco- hol from Customs custody by the United States or any governmental agency thereof for its own use for non- beverage purposes. Such permit shall be filed before release under the entry without the deposit of estimated du- ties, if any, and internal revenue tax, or before release in accordance with the provisions of § 141.102(d) of this chapter. (See subpart M of part 251, Bu- reau of Alcohol, Tobacco and Firearms Regulations (27 CFR part 251, subpart M)).

(c) The procedures for the withdrawal free of tax on the entry of ethyl alcohol for nonbeverage purposes from the Vir- gin Islands are found in subpart O of part 250, Bureau of Alcohol, Tobacco and Firearms Regulations (27 CFR part 250, subpart O).

[T.D. 89–65, 54 FR 28413, July 6, 1989]

UNITED STATES GOVERNMENT IMPORTATIONS

§ 10.100 Entry, examination, and tariff status.

Except as otherwise provided for in §§ 10.101, 10.102, 10.104, 141.83(d)(8), 141.102(d), or elsewhere in this chapter, importations made by or for the ac- count of any agency or office of the United States Government are subject to the usual Customs entry and exam- ination requirements. In the absence of express exemptions from duty, such as are contained in subheadings 9808.00.10, 9808.00.20, 9808.00.30, 9808.00.40, 9808.00.50,

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00160 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

151

U.S. Customs and Border Protection, DHS; Treasury § 10.102

9808.00.60, 9808.00.70, or other sub- headings in the Harmonized Tariff Schedule of the United States (19 U.S.C. 1202) providing for free entry, such importations are also subject to duty.

[T.D. 77–23, 42 FR 2310, Jan. 11, 1977, as amended by T.D. 89–1, 53 FR 51251, Dec. 21, 1988; T.D. 97–82, 62 FR 51769, Oct. 3, 1997]

§ 10.101 Immediate delivery. (a) Shipments entitled to immediate de-

livery. Shipments consigned to or for the account of any agency or office of the United States Government, or to an officer or official of any such agency in his official capacity, shall be re- garded for purposes of these regula- tions as shipments the immediate de- livery of which is necessary within the purview of section 448(b), Tariff Act of 1930, as amended (19 U.S.C. 1448(b)).

(b) Immediate delivery applications. The shipments described in the pre- ceding paragraph may be released upon the filing of immediate delivery appli- cations on Customs Form 3461 as set forth in subpart A of part 142 of this chapter. Such applications may be lim- ited to particular shipments or may cover all shipments imported by the Government agency making the appli- cation. They may be approved for spe- cific periods of time or for indefinite periods of time, provided in either case they are supported by carrier’s certifi- cates and stipulations as provided for in paragraph (c) of this section.

(c) Carrier’s certificates and stipula- tions. Before the release of a shipment under an immediate delivery permit, evidence of the right of the applicant to make entry for the articles shall be furnished the port director in accord- ance with the provisions of §§ 141.11 and 141.12 of this chapter.

(d) Bond. No bond shall be required in support of an immediate delivery appli- cation provided for in this section if a stipulation in the form as set forth below is filed with the port director in connection with the application:

I, llll, llll (Title), a duly author- ized representative of the —————————— llllllllllllllllllllllll

(Name of United States Government depart- ment or agency) stipulate and agree on be- half of such department or agency that all applicable provisions of the Tariff Act of

1930, as amended, and the regulations there- under, and all other laws and regulations, re- lating to the release and entry of merchan- dise will be observed and complied with in all respects.

———————————— (Signature)

(e) Timely entries required. If proper entries for consumption for importa- tions released under these regulations are not filed within a reasonable time, appropriate steps shall be taken to in- sure the prompt filing of such entries.

[T.D. 77–23, 42 FR 2310, Jan. 11, 1977, as amended by T.D. 87–75, 52 FR 20067, May 29, 1987]

§ 10.102 Duty-free entries.

(a) Invoice or declaration. No invoice or other declaration of the shipper shall be required for shipments ex- pressly exempt from duty as provided in subheadings 9808.00.10, 9808.00.20, 9808.00.30, 9808.00.40, 9808.00.50, 9808.00.60, 9808.00.70, or other subheadings in the Harmonized Tariff Schedule of the United States (HTSUS) (19 U.S.C. 1202) providing for free entry. However, the importing Government agency or office shall present any invoice, memo- randum invoice, or bill pertaining to the merchandise in its possession or available to it, or, if no such invoice or bill is available, a pro forma invoice prepared in accordance with § 141.85 of this chapter, setting forth adequate in- formation for examination and deter- mination of the dutiable status of the merchandise. In addition, the port di- rector shall only admit articles free of duty under subheadings 9808.00.30, 9808.00.40, 9808.00.50, HTSUS (19 U.S.C. 1202), upon the receipt of a certificate executed in the manner and form de- scribed in paragraph (b) of this section.

(b) Certification. One of the following certificates executed by a duly author- ized officer or official of the appro- priate Government agency or office is required for free entry of articles under subheadings 9808.00.30, 9808.00.40, or 9808.00.50, HTSUS (19 U.S.C. 1202). The certificates may be printed, stamped, or typewritten on the Customs entry or withdrawal form, Customs Form 7501, or on a separate paper attached to the entry or withdrawal form filed by the Government agency or office, provided

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00161 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

152

19 CFR Ch. I (4–1–12 Edition)§ 10.103

the certification is clearly and unmis- takably identified with the articles covered by the entry or withdrawal.

(1) Articles for military departments, subheading 9808.00.30, HTSUS. I certify that the procurement of this material constituted an emergency purchase of war material abroad by the Depart- ment of the (name of military depart- ment), and it is accordingly requested that such material be admitted free of duty pursuant to subheading 9808.00.30, HTSUS.

llllllllllllllllllllllll

(Name) llllllllllllllllllllllll

(Title), who has been designated to execute free-entry certificates for the above-named department.

llllllllllllllllllllllll

(Grade or Rank) (Organization)

(2) Articles for the Defense Logistics Agency, subheading 9808.00.40, HTSUS. Pursuant to subheading 9808.00.40, HTSUS, I hereby certify that the above-described materials are strategic and critical materials procured under the Strategic and Critical Materials Stock Piling Act (50 U.S.C. 98e).

llllllllllllllllllllllll

(Name) llllllllllllllllllllllll

(Title), Defense Logistics Agency, who has been duly authorized to execute the above certificate.

(3) Articles for the Department of En- ergy, subheading 9808.00.50, HTSUS. I certify to the Secretary of the Treas- ury that the above-described materials are source materials purchased abroad, the admittance of which is necessary in the interest of the common defense and security, in accordance with sub- heading 9808.00.50, HTSUS.

llllllllllllllllllllllll

(Name) llllllllllllllllllllllll

(Title), who has been authorized to execute free-entry certificates for the Department of Energy.

(c) Release of shipments. Shipments for which free entry has been or will be claimed under subheading 9808.00.30, 9808.00.40, 9808.00.50, HTSUS (19 U.S.C. 1202), shall be released after only such examination as is necessary to identify them.

(d) Entry in Government name. All ma- terials for which free entry is claimed

under subheading 9808.00.30, 9808.00.40, 9808.00.50, HTSUS (19 U.S.C. 1202), shall be entered, or withdrawn from ware- house, for consumption in the name of the Government department whose rep- resentative executes the certificate set forth in § 10.102(b) unless exemption from this requirement is specifically authorized by the port director.

[T.D. 77–23, 42 FR 2311, Jan. 11, 1977, as amended by T.D. 85–123, 50 FR 29953, July 23, 1985; T.D. 89–1, 53 FR 51251, Dec. 21, 1988; T.D. 93–44, 58 FR 34523, June 28, 1993; T.D 95–81, 60 FR 52295, Oct. 6, 1995]

§ 10.103 American goods returned.

(a) Certificate required. Articles en- tered, or withdrawn from warehouse, for consumption in the name of an agency or office of the United States Government (with the exception of military scrap belonging to the Depart- ment of Defense) may be admitted free of duty under subheading 9801.00.10, Harmonized Tariff Schedule of the United States (HTSUS) (19 U.S.C. 1202), upon the filing of a certificate on the letterhead of the agency or office in the following form in lieu of other entry documentation:

I hereby certify: 1. That the following articles imported in

the llllllllllll (Name of Carrier) at the port of llllllllllll (Port) on llllll (Date) consist of returned products which are the growth, produce, or manufacture of the United States, and have been returned to the United States without having been advanced in value or improved in condition by any process of manufacture or other means, and that no drawback has been or will be claimed on such articles, and that the articles currently belonging to and are for the further use of llllllllllll (Agency or Office)

Number of con- tainers

Bill of lading No. 1

General description of articles

1 If shipment arrives in the United States on a commercial carrier.

2. That the shipment does not contain military scrap.

3. That the shipment is entitled to entry under subheading 9801.00.10, Harmonized Tar- iff Schedule of the United States (HTSUS) free of duty.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00162 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

153

U.S. Customs and Border Protection, DHS; Treasury § 10.107

4. That I am a military installation trans- portation officer having knowledge of the facts involved in this certificate.

or I am an officer or official authorized by

llllllll (Agency or Office) (Which- ever is applicable) to execute this certificate. llllllllllllllllllllllll

(Name) llllllllllllllllllllllll

(Rank and branch of service or Agency or Office)

(b) Combined certificate when articles are intermingled. When articles claimed to be free under subheading 9801.00.10 and other articles claimed to be free under subheadings 9808.00.30, 9808.00.40, 9808.00.50, HTSUS (19 U.S.C. 1202), are intermingled in a single shipment in a manner which precludes separation for the purpose of making claims for free entry under the separate categories, all the articles may be covered by a com- bined certificate which follows the re- quirements of § 10.102(b) and paragraph (a) of this section.

(c) Execution of certificate. The certifi- cate required by paragraph (a) of this section may be executed by any mili- tary installation transportation officer having knowledge of the facts or by any other officer or official specifically designated or authorized to execute such certificates by the importing Gov- ernment agency or office. If the mer- chandise arrived on a commercial car- rier, the entry shall be supported by evidence of the right to make it.

[T.D. 77–23, 42 FR 2311, Jan. 11, 1977, as amended by T.D. 89–1, 53 FR 51251, Dec. 21, 1988]

§ 10.104 Temporary importation en- tries for United States Government agencies.

The entry of articles brought into the United States temporarily by an agency or office of the United States Government and claimed to be exempt from duty under Chapter 98, Sub- chapter XIII, Heading 9813, Harmonized Tariff Schedule of the United States (HTSUS), shall be made on Customs Form 7501. No bond shall be required if the agency or office files a stipulation in the form set forth in § 141.102(d) of this chapter. In those cases in which the provisions of Chapter 98, Sub- chapter XIII, HTSUS (19 U.S.C. 1202),

are not met, however, the port director will proceed as if a bond had been filed to cover the particular importation. Articles temporarily imported by a Government agency or office under this section are entitled to immediate de- livery under the procedures set forth in § 10.101.

[T.D. 77–23, 42 FR 2311, Jan. 11, 1977, as amended by T.D. 89–1, 53 FR 51251, Dec. 21, 1988]

WHEAT

§ 10.106 [Reserved]

RESCUE AND RELIEF WORK

§ 10.107 Equipment and supplies; ad- mission.

(a) There shall be admitted without entry and without the payment of duty or any tax imposed upon or by reason of importation of any article described in section 322(b), Tariff Act of 1930, as amended, subject to compliance with the following conditions:

(1) Before importation or as soon thereafter as possible, and in every case before the expiration of 10 days after importation, a report shall be made to the nearest Customs officer by the person in charge of sending the ar- ticle from the foreign country, or by the person for whose account it was brought into the United States, stating the character, quantity, destination, and use to be made of the article.

(2) If practicable, the article shall be exported under Customs supervision. In any other case a report shall be made by the person in charge of the expor- tation as soon as possible after expor- tation to the Customs officer to whom the arrival was reported, stating the character, quantity, and circumstances of the exportation.

(b) In the case of each article admit- ted under paragraph (a) of this section, the port director shall satisfy himself as to whether the article was exported within a reasonable time, or that it has been properly expended or destroyed. If an article is so far destroyed, in con- nection with a use contemplated for it by section 322 (b) that it has only a sal- vage value, it shall not be required to be exported.

(c) Any article admitted under para- graph (a) of this section which is used

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00163 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

154

19 CFR Ch. I (4–1–12 Edition)§ 10.108

in the United States otherwise than for a purpose contemplated for it by sec- tion 322(b), or which is not exported within 90 days after its arrival in the United States, or within such longer time as may be specially authorized by the port director or Headquarters, U.S. Customs Service, shall be seized and forfeited to the United States.

[28 FR 14663, Dec. 31, 1963, as amended by T.D. 89–1, 53 FR 51252, Dec. 21, 1988]

PRODUCTS EXPORTED UNDER LEASE AND REIMPORTED

§ 10.108 Entry of reimported articles exported under lease.

Free entry shall be accorded under subheading 9801.00.20, Harmonized Tar- iff Schedule of the United States (HTSUS), whenever it is established to the satisfaction of the port director that the article for which free entry is claimed was duty paid on a previous importation or was previously entered free of duty pursuant to the Caribbean Basin Economic Recovery Act or Title V of the Trade Act of 1974, is being re- imported without having been ad- vanced in value or improved in condi- tion by any process of manufacture or other means, was exported from the United States under a lease or similar use agreement, and is being reimported by or for the account of the person who imported it into, and exported it from, the United States.

[T.D. 94–40, 59 FR 17474, Apr. 13, 1994]

STRATEGIC MATERIALS OBTAINED BY BARTER OR EXCHANGE

§ 10.110 [Reserved]

LATE FILING OF FREE ENTRY AND REDUCED DUTY DOCUMENTS

§ 10.112 Filing free entry documents or reduced duty documents after entry.

Whenever a free entry or a reduced duty document, form, or statement re- quired to be filed in connection with the entry is not filed at the time of the entry or within the period for which a bond was filed for its production, but failure to file it was not due to willful negligence or fraudulent intent, such document, form, or statement may be

filed at any time prior to liquidation of the entry or, if the entry was liq- uidated, before the liquidation becomes final. See § 113.43(c) of this chapter for satisfaction of the bond and cancella- tion of the bond charge.

[T.D. 74–227, 39 FR 32015, Sept. 4, 1974]

INSTRUMENTS AND APPARATUS FOR EDU- CATIONAL AND SCIENTIFIC INSTITU- TIONS

§ 10.114 General provisions.

The consolidated regulations of the Commerce and Treasury Departments relating to the entry of instruments and apparatus for educational and sci- entific institutions are contained in 15 CFR part 301.

[T.D. 82–224, 47 FR 53727, Nov. 29, 1982]

§§ 10.115–10.119 [Reserved]

VISUAL OR AUDITORY MATERIALS

§ 10.121 Visual or auditory materials of an educational, scientific, or cul- tural character.

(a) Where photographic film and other articles described in subheading 9817.00.40, Harmonized Tariff Schedule of the United States (HTSUS), are claimed to be free of duty under sub- heading 9817.00.40, HTSUS, there must be filed, in connection with the entry covering such articles, a document issued by the U.S. Department of State certifying that it has determined that the articles are visual or auditory ma- terials of an educational, scientific, or cultural character within the meaning of the Agreement for Facilitating the International Circulation of Visual and Auditory Materials of an Educational, Scientific, and Cultural Character as required by U.S. note 1(a)(i), Sub- chapter XVII, chapter 98, HTSUS.

(b) Articles entered under subheading 9817.00.40, HTSUS, will be released from CBP custody prior to submission of the document required in paragraph (a) of this section only upon the deposit of estimated duties with the port direc- tor. Liquidation of an entry which has been released under this procedure will be suspended for a period of 314 days

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00164 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

155

U.S. Customs and Border Protection, DHS; Treasury § 10.137

from the date of entry or until the re- quired document is submitted, which- ever comes first. In the event that doc- umentation is not submitted before liq- uidation, the merchandise will be clas- sified and liquidated in the ordinary course, without regard to subheading 9817.00.40, HTSUS.

[CBP Dec. 10–33, 75 FR 69585, Nov. 15, 2010; CBP Dec. 12–02, 77 FR 10369, Feb. 22, 2012]

RATE OF DUTY DEPENDENT UPON ACTUAL USE

§ 10.131 Circumstances in which appli- cable.

The provisions of §§ 10.131 through 10.139 are applicable in those cir- cumstances in which the rate of duty applicable to merchandise is dependent upon actual use, unless there is a spe- cific provision in this part which gov- erns the treatment of the merchandise. However, specific marking or certifi- cation requirements, such as those for bolting cloths in section 10.58, may be applicable to merchandise subject to the provisions of sections 10.131–10.139.

[T.D. 71–139, 36 FR 10726, June 2, 1971, as amended by T.D. 86–118, 51 FR 22515, June 20, 1986]

§ 10.132 [Reserved]

§ 10.133 Conditions required to be met. When the tariff classification of any

article is controlled by its actual use in the United States, three conditions must be met in order to qualify for free entry or a lower rate of duty unless the language of the particular subheading of the Harmonized Tariff Schedule of the United States applicable to the merchandise specifies other conditions. The conditions are that:

(a) Such use is intended at the time of importation.

(b) The article is so used. (c) Proof of use is furnished within 3

years after the date the article is en- tered or withdrawn from warehouse for consumption.

[T.D. 71–139, 36 FR 10726, June 2, 1971, as amended by T.D. 89–1, 53 FR 51252, Dec. 21, 1988]

§ 10.134 Declaration of intent. A showing of intent by the importer

as to the actual use of imported mer-

chandise shall be made by filing with the entry for consumption or for ware- house a declaration as to the intended use of the merchandise, or by entering the proper subheading of an actual use provision of the Harmonized Tariff Schedule of the United States (HTSUS) and the reduced or free rate of duty on the entry form. Entry made under an actual use provision of the HTSUS may be construed as a declaration that the merchandise is entered to be used for the purpose stated in the HTSUS, pro- vided the port director is satisfied the merchandise will be so used. However, the port director shall require a writ- ten declaration to be filed if he is not satisfied that merchandise entered under an actual use provision will be used for the purposes stated in the HTSUS.

[T.D. 71–139, 36 FR 10726, June 2, 1971, as amended by T.D. 89–1, 53 FR 51252, Dec. 21, 1988]

§ 10.135 Deposit of duties. When the requirement of § 10.134 has

been met the merchandise may be en- tered or withdrawn from warehouse for consumption without deposit of duty when proof of use will result in free entry, or with deposit of duty at the lower rate when proof of use will result in a lower rate of duty.

[T.D. 71–139, 36 FR 10726, June 2, 1971, as amended by T.D. 84–213, 49 FR 41166, Oct. 19, 1984]

§ 10.136 Suspension of liquidation. Liquidation of an entry covering

merchandise for which a declaration of intent has been made pursuant to § 10.134 and any required deposit of du- ties made, shall be suspended until proof of use is furnished or the 3-year period allowed for production thereof has expired.

[T.D. 71–139, 36 FR 10726, June 2, 1971]

§ 10.137 Records of use. (a) Maintenance by importer. The im-

porter shall maintain accurate and de- tailed records showing the use or other disposition of the imported merchan- dise. The burden shall be on the im- porter to keep records so that the claim of actual use can be readily es- tablished.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00165 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

156

19 CFR Ch. I (4–1–12 Edition)§ 10.138

(b) Retention of records. The importer shall retain records of use or disposi- tion for a period of 3 years from the date of liquidation of the entry.

(c) Examination of records. The rec- ords required to be kept by paragraph (a) of this section shall be available at all times for examination and inspec- tion by an authorized Customs officer.

[T.D. 71–139, 36 FR 10726, June 2, 1971]

§ 10.138 Proof of use. Within 3 years from the date of entry

or withdrawal from warehouse for con- sumption, the importer shall submit in duplicate in support of his claim for free entry or for a reduced rate of duty a certificate executed by (1) the super- intendent or manager of the manufac- turing plant, or (2) the individual end- user or other person having knowledge of the actual use of the imported arti- cle. The certificate shall include a de- scription of the processing in sufficient detail to show that the use con- templated by the law has actually taken place. A blanket certificate cov- ering all purchases of a given type of merchandise from a particular im- porter during a given period, or all such purchases with specified excep- tions, may be accepted for this pur- pose, provided the importer shall fur- nish a statement showing in detail, in such manner as to be readily identified with each entry, the merchandise which he sold to such manufacturer or end-user during such period.

[T.D. 71–139, 36 FR 10727, June 2, 1971]

§ 10.139 Liquidation. (a) In general. Upon satisfactory proof

of timely use of the merchandise for the purpose specified by law, the entry shall be liquidated free of duty or at the lower rate of duty specified by law. When such proof is not filed within 3 years from the date of entry or with- drawal from warehouse for consump- tion, the entry shall be liquidated duti- able under the appropriate subheading of the Harmonized Tariff Schedule of the United States.

(b) Exception for blackstrap molasses. An entry covering blackstrap molasses, as hereinafter defined, may be accepted and liquidated with duty at the lower rate after the filing of the declaration

of intent required by § 10.134 and the de- posit of estimated duties required by § 10.135 without compliance with §§ 10.136, 10.137, and 10.138. Blackstrap molasses is ‘‘final’’ molasses prac- tically free from sugar crystals, con- taining not over 58 percent total sugars and having a ratio of

total sugars × 100/Brix

not in excess of 71. In the event of doubt, an ash determination may be made. An ash content of not less than 7 percent indicates a blackstrap molas- ses within the meaning of this para- graph.

[T.D. 71–139, 36 FR 10727, June 2, 1971, as amended by T.D. 89–1, 53 FR 51252, Dec. 21, 1988]

IMPORTATIONS NOT OVER $200 AND BONA FIDE GIFTS

§ 10.151 Importations not over $200. Subject to the conditions in § 10.153 of

this part, the port director shall pass free of duty and tax any shipment of merchandise, as defined in § 101.1 of this chapter, imported by one person on one day having a fair retail value, as evi- denced by an oral declaration or the bill of lading (or other document filed as the entry) or manifest listing each bill of lading, in the country of ship- ment not exceeding $200, unless he has reason to believe that the shipment is one of several lots covered by a single order or contract and that it was sent separately for the express purpose of securing free entry therefor or of avoiding compliance with any perti- nent law or regulation. Merchandise subject to this exemption shall be en- tered under the informal entry proce- dures (see subpart C, part 143, and §§ 128.24, 145.31, 148.12, and 148.62, of this chapter).

[T.D. 94–51, 59 FR 30293, June 13, 1994, as amended by T.D. 95–31, 60 FR 18990, Apr. 14, 1995; T.D. 95–31, 60 FR 37875, July 24, 1995; T.D. 97–82, 62 FR 51769, Oct. 3, 1997]

§ 10.152 Bona-fide gifts. Subject to the conditions in § 10.153 of

this part, the port director shall pass free of duty and tax any article sent as a bona-fide gift from a person in a for- eign country to a person in the United States, provided that the aggregate

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00166 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

157

U.S. Customs and Border Protection, DHS; Treasury § 10.153

fair retail value in the country of ship- ment of such articles received by one person on one day does not exceed $100 or, in the case of articles sent from a person in the Virgin Islands, Guam, and American Samoa, $200. Articles subject to this exemption shall be en- tered under the informal entry proce- dures (see subpart C, part 143, and §§ 145.32, 148.12, 148.51, and 148.64, of this chapter). An article is ‘‘sent’’ for pur- poses of this section if it is conveyed in any manner other than on the person or in the accompanied or unaccom- panied baggage of the donor or donee.

[T.D. 94–51, 59 FR 30293, June 13, 1994]

§ 10.153 Conditions for exemption. Customs officers shall be further

guided as follows in determining whether an article or parcel shall be exempted from duty and tax under § 10.151 or § 10.152:

(a) A ‘‘bona fide gift’’ for purposes of § 10.152 is an article formerly owned by a donor (may be a commercial firm) who gave it outright in its entirety to a donee without compensation or promise of compensation. It does not include articles acquired by purchase, barter, promissory exchange, or similar transaction, nor does it include articles said to be ‘‘given’’ in conjunction with a purchase, barter, promissory ex- change, or similar transaction, such as a so-called bonus article.

(b) A parcel addressed to a person in the United States from an individual in a foreign country which contains a gift should be clearly marked on the out- side to indicate that it contains a gift. Such marking is not conclusive evi- dence of a gift nor is the absence of such marking conclusive evidence that an article is not a gift. Ordinarily an article not exceeding $100 in fair retail value in the country of shipment sent from a person in a foreign country to a person in the United States ($200, in the case of an article sent from a per- son in the Virgin Islands, Guam, and American Samoa) will be recognizable as a gift from the nature of the article and obvious facts surrounding the ship- ment.

(c) A parcel addressed to a person in the United States from a business firm in a foreign country would ordinarily not contain a gift from a donor in the

foreign country. When such a parcel in fact contains an article entitled to free entry under § 10.152, the parcel should be clearly marked to indicate that it contains such a gift and a statement to this effect should be enclosed in the parcel.

(d) Consolidated shipments addressed to one consignee shall be treated for purposes of §§ 10.151 and 10.152 as one importation. The foregoing shall not apply to shipments of bona fide gifts consolidated abroad for shipment to the United States when:

(1) The consolidation for shipment to the United States is in a cargo van or similar containerization which is con- signed to a common carrier, freight forwarder, freight handler, or other public service agency for distribution of the gift packages;

(2) The separate gifts not exceeding $100 in fair retail value in the country of shipment ($200, in the case of arti- cles sent from persons in the Virgin Is- lands, Guam, and American Samoa) in- cluded in the consolidated shipment are before shipment individually wrapped and addressed to the donee in the United States;

(3) Each gift package is marked on the outside to indicate that it contains a gift not exceeding $100 in fair retail value in the country of shipment ($200, in the case of packages sent from per- sons in the Virgin Islands, Guam, and American Samoa); and

(4) Each gift package is separately listed in the name of the addressee- donee on a packing list, manifest, bill of lading, or other shipping document.

(e) No alcoholic beverage, perfume containing alcohol (except where the aggregate fair retail value in the coun- try of shipment of all merchandise con- tained in the shipment does not exceed $5), cigars, or cigarettes shall be ex- empted from the payment of duty and tax under § 10.151 or § 10.152.

(f) The exemptions provided for in § 10.151 or § 10.152 are not to be allowed in respect of any shipment containing one or more gifts having an aggregate fair retail value in the country of ship- ment in excess of $100 ($200, in the case of articles sent from persons in the Vir- gin Islands, Guam, and American Samoa), except as indicated in para- graph (d) of this section. For example,

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00167 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

158

19 CFR Ch. I (4–1–12 Edition)§ 10.171

an article ordinarily subject to an ad valorem rate of duty but sent as a gift, if the fair retail value exceeds the $100 (or $200) exemption, would be subject to a duty based upon its value under the provisions of section 402 or 402(a), Tar- iff Act of 1930, as amended (19 U.S.C. 1401a or 1402), even though the dutiable value is less than the $100 (or $200) ex- emption.

(g) The exemption referred to in § 10.151 is not to be allowed in the case of any merchandise of a class or kind provided for in any absolute or tariff- rate quota, whether the quota is open or closed. In the case of merchandise of a class or kind provided for in a tariff- rate quota, the merchandise is subject to the rate of duty in effect on the date of entry.

[T.D. 73–175, 38 FR 17445, July 2, 1973, as amended by T.D. 75–185, 40 FR 31753, July 29, 1975; T.D. 78–394, 43 FR 49787, Oct. 25, 1978; T.D. 85–123, 50 FR 29953, July 23, 1985; T.D. 94– 51, 59 FR 30293, June 13, 1994]

GENERALIZED SYSTEM OF PREFERENCES

§ 10.171 General. (a) Statutory authority. Title V of the

Trade Act of 1974 as amended (19 U.S.C. 2461–2467) authorizes the President to establish a Generalized System of Pref- erences (GSP) to provide duty-free treatment for eligible articles im- ported directly from designated bene- ficiary developing countries. Bene- ficiary developing countries and arti- cles eligible for duty-free treatment are designated by the President by Ex- ecutive order in accordance with sec- tions 502(a)(1) and 503(a) of the Trade Act of 1974 as amended (19 U.S.C. 2462(a)(1), 2463(a)).

(b) Country defined. For purposes of §§ 10.171 through 10.178, except as other- wise provided in § 10.176(a), the term ‘‘country’’ means any foreign country, any overseas dependent territory or possession of a foreign country, or the Trust Territory of the Pacific Islands. In the case of an association of coun- tries which is a free trade area or cus- toms union or which is contributing to comprehensive regional economic inte- gration among its members through appropriate means, including but not limited to, the reduction of duties, the President may by Executive order pro-

vide that all members of such associa- tion other than members which are barred from designation under section 502(b) of the Trade Act of 1974 (19 U.S.C. 2462(b)) shall be treated as one country for purposes of §§ 10.171 through 10.178.

[T.D. 76–2, 40 FR 60047, Dec. 31, 1975, as amended by T.D. 80–271, 45 FR 75641, Nov. 17, 1980; T.D. 00–67, 65 FR 59675, Oct. 5, 2000]

§ 10.172 Claim for exemption from duty under the Generalized System of Preferences.

A claim for an exemption from duty on the ground that the Generalized System of Preferences applies shall be allowed by the port director only if he is satisfied that the requirements set forth in this section and §§ 10.173 through 10.178 have been met. If duty- free treatment is claimed at the time of entry, a written claim shall be filed on the entry document by placing the symbol ‘‘A’’ as a prefix to the sub- heading of the Harmonized Tariff Schedule of the United States for each article for which such treatment is claimed.

[T.D. 76–2, 40 FR 60048, Dec. 31, 1975, as amended by T.D. 77–36, 42 FR 5041, Jan. 27, 1977; T.D. 89–1, 53 FR 51252, Dec. 21, 1988; T.D. 94–47, 59 FR 25569, May 17, 1994; T.D. 99–27, 64 FR 13675, Mar. 22, 1999]

§ 10.173 Evidence of country of origin.

(a) Shipments covered by a formal entry—(1) Merchandise not wholly the growth, product, or manufacture of a ben- eficiary developing country. (i) Declara- tion. In a case involving merchandise covered by a formal entry which is not wholly the growth, product, or manu- facture of a single beneficiary devel- oping country, the exporter of the mer- chandise or other appropriate party having knowledge of the relevant facts shall be prepared to submit directly to the port director, upon request, a dec- laration setting forth all pertinent de- tailed information concerning the pro- duction or manufacture of the mer- chandise. When requested by the port director, the declaration shall be pre- pared in substantially the following form:

GSP DECLARATION

I, lllllllllllllllllllll

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00168 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

159

U.S. Customs and Border Protection, DHS; Treasury § 10.174

(name), hereby declare that the articles de- scribed below were produced or manufac- tured in llllllll (country) by means of processing operations performed in that country as set forth below and were also sub- jected to processing operations in the other country or countries which are members of

the same association of countries as set forth below and incorporate materials pro- duced in the country named above or in any other country or countries which are mem- bers of the same association of countries as set forth below:

Number and date of invoices Description of articles and

quantity

Processing operations per- formed on articles

Materials produced in a bene- ficiary developing country or

members of the same associa- tion

Description of processing op- erations and

country of processing

Direct costs of processing op-

erations

Description of material, pro- duction proc-

ess, and coun- try of produc-

tion

Cost or value of material

Date lllllllllllllllllllll Address lllllllllllllllllll Signature llllllllllllllllll Title lllllllllllllllllllll

(ii) Retention of records and submission of declaration. The information nec- essary for preparation of the declara- tion shall be retained in the files of the party responsible for its preparation and submission for a period of 5 years. In the event that the port director re- quests submission of the declaration during the 5-year period, it shall be submitted by the appropriate party di- rectly to the port director within 60 days of the date of the request or such additional period as the port director may allow for good cause shown. Fail- ure to submit the declaration in a timely fashion will result in a denial of duty-free treatment.

(2) Merchandise wholly the growth, product, or manufacture of a beneficiary developing country. In a case involving merchandise covered by a formal entry which is wholly the growth, product, or manufacture of a single beneficiary de- veloping country, a statement to that effect shall be included on the commer- cial invoice provided to Customs.

(b) Shipments covered by an informal entry. Although the filing of the dec- laration provided for in paragraph (a)(1)(i) of this section will not be re- quired for a shipment covered by an in- formal entry, the port director may re- quire such other evidence of country of origin as deemed necessary.

(c) Verification of documentation. Any evidence of country of origin submitted under this section shall be subject to such verification as the port director deems necessary. In the event that the port director is prevented from obtain- ing the necessary verification, the port director may treat the entry as duti- able.

[T.D. 94–47, 59 FR 25569, May 17, 1994]

§ 10.174 Evidence of direct shipment.

(a) Documents constituting evidence of direct shipment. The port director may require that appropriate shipping pa- pers, invoices, or other documents be submitted within 60 days of the date of entry as evidence that the articles were ‘‘imported directly’’, as that term is defined in § 10.175. Any evidence of di- rect shipment required by the port di- rector shall be subject to such verification as he deems necessary.

(b) Waiver of evidence of direct ship- ment. The port director may waive the submission of evidence of direct ship- ment when he is otherwise satisfied, taking into consideration the kind and value of the merchandise, that the merchandise clearly qualifies for treat- ment under the Generalized System of Preferences.

[T.D. 76–2, 40 FR 60048, Dec. 31, 1975, as amended by T.D. 77–27, 42 FR 3162, Jan. 17, 1977]

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00169 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

160

19 CFR Ch. I (4–1–12 Edition)§ 10.175

§ 10.175 Imported directly defined. Eligible articles shall be imported di-

rectly from a beneficiary developing country to qualify for treatment under the Generalized System of Preferences. For purposes of §§ 10.171 through 10.178 the words ‘‘imported directly’’ mean:

(a) Direct shipment from the bene- ficiary country to the United States without passing through the territory of any other country; or

(b) If the shipment is from a bene- ficiary developing country to the U.S. through the territory of any other country, the merchandise in the ship- ment does not enter into the commerce of any other country while en route to the U.S., and the invoice, bills of lad- ing, and other shipping documents show the U.S. as the final destination; or

(c) If shipped from the beneficiary de- veloping country to the United States through a free trade zone in a bene- ficiary developing country, the mer- chandise shall not enter into the com- merce of the country maintaining the free trade zone, and

(1) The eligible articles must not un- dergo any operation other than:

(i) Sorting, grading, or testing, (ii) Packing, unpacking, changes of

packing, decanting or repacking into other containers,

(iii) Affixing marks, labels, or other like distinguishing signs on articles or their packing, if incidental to oper- ations allowed under this section, or

(iv) Operations necessary to ensure the preservation of merchandise in its condition as introduced into the free trade zone.

(2) Merchandise may be purchased and resold, other than at retail, for ex- port within the free trade zone.

(3) For the purposes of this section, a free trade zone is a predetermined area or region declared and secured by or under governmental authority, where certain operations may be performed with respect to articles, without such articles having entered into the com- merce of the country maintaining the free trade zone; or

(d) If the shipment is from any bene- ficiary developing country to the U.S through the territory of any other country and the invoices and other documents do not show the U.S as the

final destination, the articles in the shipment upon arrival in the U.S. are imported directly only if they:

(1) Remained under the control of the customs authority of the intermediate country;

(2) Did not enter into the commerce of the intermediate country except for the purpose of sale other than at retail, and the port director is satisfied that the importation results from the origi- nal commercial transaction between the importer and the producer or the latter’s sales agent; and

(3) Were not subjected to operations other than loading and unloading, and other activities necessary to preserve the articles in good condition; or

(e)(1) Shipment to the U.S. from a beneficiary developing country which is a member of an association of coun- tries treated as one country under sec- tion 507(2), Trade Act of 1974, as amend- ed (19 U.S.C. 2467(2)), through the terri- tory of a former beneficiary developing country whose designation as a mem- ber of the same association for GSP purposes was terminated by the Presi- dent pursuant to section 502(d), Trade Act of 1974, as amended (19 U.S.C. 2462(d)), provided the articles in the shipment did not enter into the com- merce of the former beneficiary devel- oping country except for purposes of performing one or more of the oper- ations specified in paragraph (c)(1) of this section and except for purposes of purchase or resale, other than at retail, for export.

(2) The designation of the following countries as members of an association of countries for GSP purposes has been terminated by the President pursuant to section 502(d) of the Trade Act of 1974 (19 U.S.C. 2462(d)):

The Bahamas Brunei Darussalam Malaysia Singapore

[T.D. 76–2, 40 FR 60048, Dec. 31, 1975, as amended by T.D. 83–144, 48 FR 29684, June 28, 1983; T.D. 84–237, 49 FR 47992, Dec. 7, 1984; T.D. 86–107, 51 FR 20816, June 9, 1986; T.D. 92– 6, 57 FR 2018, Jan. 17, 1992; T.D. 94–47, 59 FR 25569, May 17, 1994; T.D. 95–30, 60 FR 18543, Apr. 12, 1995; T.D. 00–67, 65 FR 59675, Oct. 5, 2000]

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00170 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

161

U.S. Customs and Border Protection, DHS; Treasury § 10.176

§ 10.176 Country of origin criteria. (a) Merchandise produced in a bene-

ficiary developing country or any two or more countries which are members of the same association of countries—(1) Gen- eral. Except as otherwise provided in this section, any article which either is wholly the growth, product, or manu- facture of, or is a new or different arti- cle of commerce that has been grown, produced, or manufactured in, a bene- ficiary developing country may qualify for duty-free entry under the General- ized System of Preferences (GSP). No article will be considered to have been grown, produced, or manufactured in a beneficiary developing country by vir- tue of having merely undergone simple (as opposed to complex or meaningful) combining or packaging operations or mere dilution with water or mere dilu- tion with another substance that does not materially alter the characteristics of the article. Duty-free entry under the GSP may be accorded to an article only if the sum of the cost or value of the materials produced in the bene- ficiary developing country or any two or more countries that are members of the same association of countries and are treated as one country under sec- tion 507(2) of the Trade Act of 1974, as amended (19 U.S.C. 2467(2)), plus the di- rect costs of processing operations per- formed in the beneficiary developing country or member countries, is not less than 35 percent of the appraised value of the article at the time it is en- tered.

(2) Combining, packaging, and diluting operations. No article which has under- gone only a simple combining or pack- aging operation or a mere dilution in a beneficiary developing country within the meaning of paragraph (a)(1) of this section will be entitled to duty-free treatment even though the processing operation causes the article to meet the value requirement set forth in that paragraph. For purposes of this sec- tion:

(i) Simple combining or packaging operations and mere dilution include, but are not limited to, the following:

(A) The addition of batteries to de- vices;

(B) Fitting together a small number of components by bolting, glueing, sol- dering, etc.;

(C) Blending foreign and beneficiary developing country tobacco;

(D) The addition of substances such as anticaking agents, preservatives, wetting agents, etc.;

(E) Repacking or packaging compo- nents together;

(F) Reconstituting orange juice by adding water to orange juice con- centrate; and

(G) Diluting chemicals with inert in- gredients to bring them to standard de- grees of strength;

(ii) Simple combining or packaging operations and mere dilution will not be taken to include processes such as the following:

(A) The assembly of a large number of discrete components onto a printed circuit board;

(B) The mixing together of two bulk medicinal substances followed by the packaging of the mixed product into individual doses for retail sale;

(C) The addition of water or another substance to a chemical compound under pressure which results in a reac- tion creating a new chemical com- pound; and

(D) A simple combining or packaging operation or mere dilution coupled with any other type of processing such as testing or fabrication (for example, a simple assembly of a small number of components, one of which was fab- ricated in the beneficiary developing country where the assembly took place); and

(iii) The fact that an article has un- dergone more than a simple combining or packaging operation or mere dilu- tion is not necessarily dispositive of the question of whether that proc- essing constitutes a substantial trans- formation for purposes of determining the country of origin of the article.

(b) [Reserved] (c) Merchandise grown, produced, or

manufactured in a beneficiary developing country. Merchandise which is wholly the growth, product, or manufacture of a beneficiary developing country, or an association of countries treated as one country under section 507(2) of the Trade Act of 1974 (19 U.S.C. 2467(2)) and § 10.171(b), and manufactured products consisting of materials produced only

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00171 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

162

19 CFR Ch. I (4–1–12 Edition)§ 10.177

in such country or countries, shall nor- mally be presumed to meet the require- ments set forth in this section.

[T.D. 76–2, 40 FR 60048, Dec. 31, 1975, as amended by T.D. 80–271, 45 FR 75641, Nov. 17, 1980; T.D. 00–67, 65 FR 59675, Oct. 5, 2000]

§ 10.177 Cost or value of materials pro- duced in the beneficiary developing country.

(a) ‘‘Produced in the beneficiary devel- oping country’’ defined. For purposes of §§ 10.171 through 10.178, the words ‘‘pro- duced in the beneficiary developing country’’ refer to the constituent ma- terials of which the eligible article is composed which are either:

(1) Wholly the growth, product, or manufacture of the beneficiary devel- oping country; or

(2) Substantially transformed in the beneficiary developing country into a new and different article of commerce.

(b) Questionable origin. When the ori- gin of an article either is not ascertain- able or not satisfactorily demonstrated to the port director, the article shall not be considered to have been pro- duced in the beneficiary developing country.

(c) Determination of cost or value of materials produced in the beneficiary de- veloping country. (1) The cost or value of materials produced in the bene- ficiary developing country includes:

(i) The manufacturer’s actual cost for the materials;

(ii) When not included in the manu- facturer’s actual cost for the materials, the freight, insurance, packing, and all other costs incurred in transporting the materials to the manufacturer’s plant;

(iii) The actual cost of waste or spoil- age (material list), less the value of re- coverable scrap; and

(iv) Taxes and/or duties imposed on the materials by the beneficiary devel- oping country, or an association of countries treated as one country, pro- vided they are not remitted upon ex- portation.

(2) Where the material is provided to the manufacturer without charge, or at less than fair market value, its cost or value shall be determined by com- puting the sum of:

(i) All expenses incurred in the growth, production, manufacture or as-

sembly of the material, including gen- eral expenses;

(ii) An amount for profit; and (iii) Freight, insurance, packing, and

all other costs incurred in transporting the materials to the manufacturer’s plant.

If the pertinent information needed to compute the cost or value of the mate- rials is not available, the appraising of- ficer may ascertain or estimate the value thereof using all reasonable ways and means at his disposal.

[T.D. 76–2, 40 FR 60049, Dec. 31, 1975, as amended by T.D. 86–118, 51 FR 22515, June 20, 1986]

§ 10.178 Direct costs of processing op- erations performed in the bene- ficiary developing country.

(a) Items included in the direct costs of processing operations. As used in § 10.176, the words ‘‘direct costs of processing operations’’ means those costs either directly incurred in, or which can be reasonably allocated to, the growth, production, manufacture, or assembly of the specific merchandise under con- sideration. Such costs include, but are not limited to:

(1) All actual labor costs involved in the growth, production, manufacture, or assembly of the specific merchan- dise, including fringe benefits, on-the- job training, and the cost of engineer- ing, supervisory, quality control, and similar personnel;

(2) Dies, molds, tooling, and deprecia- tion on machinery and equipment which are allocable to the specific mer- chandise;

(3) Research, development, design, engineering, and blueprint costs inso- far as they are allocable to the specific merchandise; and

(4) Costs of inspecting and testing the specific merchandise.

(b) Items not included in the direct costs of processing operations. Those items which are not included within the meaning of the words ‘‘direct costs of processing operations’’ are those which are not directly attributable to the merchandise under consideration or are not ‘‘costs’’ of manufacturing the prod- uct. These include, but are not limited to:

(1) Profit; and

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00172 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

163

U.S. Customs and Border Protection, DHS; Treasury § 10.178a

(2) General expenses of doing business which are either not allocable to the specific merchandise or are not related to the growth, production, manufac- ture, or assembly of the merchandise, such as administrative salaries, cas- ualty and liability insurance, adver- tising, and salesmen’s salaries, com- missions, or expenses.

[T.D. 76–2, 40 FR 60049, Dec. 31, 1975]

§ 10.178a Special duty-free treatment for sub-Saharan African countries.

(a) General. Section 506A of the Trade Act of 1974 (19 U.S.C. 2466a) authorizes the President to provide duty-free treatment for certain articles other- wise excluded from duty-free treat- ment under the Generalized System of Preferences (GSP) pursuant to section 503(b)(1)(B) through (G) of the Trade Act of 1974 (19 U.S.C. 2463(b)(1)(B) through (G)) and authorizes the Presi- dent to designate a country listed in section 107 of the African Growth and Opportunity Act (19 U.S.C. 3706) as an eligible beneficiary sub-Saharan Afri- can country for purposes of that duty- free treatment.

(b) Eligible articles. The duty-free treatment referred to in paragraph (a) of this section will apply to any article within any of the following classes of articles, provided that the article in question has been designated by the President for that purpose and is the growth, product, or manufacture of an eligible beneficiary sub-Saharan Afri- can country and meets the require- ments specified or referred to in para- graph (d) of this section:

(1) Watches, except those watches en- tered after June 30, 1989, that the Presi- dent specifically determines, after pub- lic notice and comment, will not cause material injury to watch or watch band, strap, or bracelet manufacturing and assembly operations in the United States or the United States insular possessions;

(2) Certain electronic articles; (3) Certain steel articles; (4) Footwear, handbags, luggage, flat

goods, work gloves, and leather wear- ing apparel which were not eligible ar- ticles for purposes of the GSP on Janu- ary 1, 1995, as the GSP was in effect on that date;

(5) Certain semimanufactured and manufactured glass products; and

(6) Any other articles which the President determines to be import-sen- sitive in the context of the GSP.

(c) Claim for duty-free treatment. A claim for the duty-free treatment re- ferred to in paragraph (a) of this sec- tion must be made by placing on the entry document the symbol ‘‘D’’ as a prefix to the subheading of the Har- monized Tariff Schedule of the United States for each article for which duty- free treatment is claimed;

(d) Origin and related rules. The provi- sions of §§ 10.171, 10.173, and 10.175 through 10.178 will apply for purposes of duty-free treatment under this sec- tion. However, application of those pro- visions in the context of this section will be subject to the following rules:

(1) The term ‘‘beneficiary developing country,’’ wherever it appears, means ‘‘beneficiary sub-Saharan African country;’

(2) In the GSP declaration set forth in § 10.173(a)(1)(i), the column heading ‘‘Materials produced in a beneficiary developing country or members of the same association’’ should read ‘‘Mate- rial produced in a beneficiary sub-Sa- haran African country or in the U.S.;’’

(3) The provisions of § 10.175(c) will not apply; and

(4) For purposes of determining com- pliance with the 35 percent value con- tent requirement set forth in § 10.176(a):

(i) An amount not to exceed 15 per- cent of the appraised value of the arti- cle at the time it is entered may be at- tributed to the cost or value of mate- rials produced in the customs territory of the United States, and the provi- sions of § 10.177 will apply for purposes of identifying materials produced in the customs territory of the United States and the cost or value of those materials; and

(ii) The cost or value of materials in- cluded in the article that are produced in more than one beneficiary sub-Saha- ran African country may be applied without regard to whether those coun- tries are members of the same associa- tion of countries.

(e) Importer requirements. In order to make a claim for duty-free treatment under this section, the importer:

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00173 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

164

19 CFR Ch. I (4–1–12 Edition)§ 10.179

(1) Must have records that explain how the importer came to the conclu- sion that the article qualifies for duty- free treatment;

(2) Must have records that dem- onstrate that the importer is claiming that the article qualifies for duty-free treatment because it is the growth of a beneficiary sub-Saharan African coun- try or because it is the product of a beneficiary sub-Saharan African coun- try or because it is the manufacture of a beneficiary sub-Saharan African country. If the importer is claiming that the article is the growth of a bene- ficiary sub-Saharan African country, the importer must have records that indicate that the product was grown in that country, such as a record of re- ceipt from a farmer whose crops are grown in that country. If the importer is claiming that the article is the prod- uct of, or the manufacture of, a bene- ficiary sub-Saharan African country, the importer must have records that indicate that the manufacturing or processing operations reflected in or applied to the article meet the country of origin rules set forth in § 10.176(a) and paragraph (d) of this section. A properly completed GSP declaration in the form set forth in § 10.173(a)(1) is one example of a record that would serve this purpose;

(3) Must establish and implement in- ternal controls which provide for the periodic review of the accuracy of the declarations or other records referred to in paragraph (e)(2) of this section;

(4) Must have shipping papers that show how the article moved from the beneficiary sub-Saharan African coun- try to the United States. If the im- ported article was shipped through a country other than a beneficiary sub- Saharan African country and the in- voices and other documents from the beneficiary sub-Saharan African coun- try do not show the United States as the final destination, the importer also must have documentation that dem- onstrates that the conditions set forth in § 10.175(d)(1) through (3) were met;

(5) Must have records that dem- onstrate the cost or value of the mate- rials produced in the United States and the cost or value of the materials pro- duced in a beneficiary sub-Saharan Af- rican country or countries and the di-

rect costs of processing operations in- curred in the beneficiary sub-Saharan African country that were relied upon by the importer to determine that the article met the 35 percent value con- tent requirement set forth in § 10.176(a) and paragraph (c) of this section. A properly completed GSP declaration in the form set forth in § 10.173(a)(1) is one example of a record that would serve this purpose; and

(6) Must be prepared to produce the records referred to in paragraphs (e)(1), (e)(2), (e)(4), and (e)(5) of this section within 30 days of a request from Cus- toms and must be prepared to explain how those records and the internal con- trols referred to in paragraph (e)(3) of this section justify the importer’s claim for duty-free treatment.

[T.D. 00–67, 65 FR 59675, Oct. 5, 2000]

CANADIAN CRUDE PETROLEUM

§ 10.179 Canadian crude petroleum subject to a commercial exchange agreement between United States and Canadian refiners.

(a) Crude petroleum (as defined in Chapter 27, Additional U.S. Note 1, Harmonized Tariff Schedule of the United States (19 U.S.C. 1202)) produced in Canada may be admitted free of duty if the entry is accompanied by a cer- tificate from the importer establishing that:

(1) The petroleum is imported pursu- ant to a commercial exchange agree- ment between United States and Cana- dian refiners which has been approved by the Secretary of Energy;

(2) An equivalent amount of domestic or duty-paid foreign crude petroleum on which the importer has executed a written waiver of drawback, has been exported to Canada pursuant to the ex- port license and previously has not been used to effect the duty-free entry of like Canadian products; and,

(3) An export license has been issued by the Secretary of Commerce for the petroleum which has been exported to Canada.

(b) The provisions of this section may be applied to:

(1) Liquidated or reliquidated entries if the required certification is filed with the director of the port where the original entry was made on or before

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00174 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

165

U.S. Customs and Border Protection, DHS; Treasury § 10.183

the 180th day after the date of entry; and

(2) Articles entered, or withdrawn from warehouse, for consumption, pur- suant to a commercial exchange agree- ment.

(c) Verification of the quantities of crude petroleum exported to or im- ported from Canada under such a com- mercial exchange agreement shall be made in accordance with import verification provided in Part 151, Sub- part C, Customs Regulations (19 CFR part 151, subpart C).

[T.D. 81–292, 46 FR 58069, Nov. 30, 1981, as amended by T.D. 89–1, 53 FR 51252, Dec. 21, 1988; T.D. 91–82, 56 FR 49845, Oct. 2, 1991]

CERTAIN FRESH, CHILLED, OR FROZEN BEEF

§ 10.180 Certification. (a) The foreign official’s meat-inspec-

tion certificate required by U.S. De- partment of Agriculture regulations (9 CFR 327.4) shall be modified to include the certification below when fresh, chilled, or frozen beef is to be entered under the provisions of subheadings 0201.20.10, 0201.30.02, 0202.20.02, 0202.20.10, Harmonized Tariff Schedule of the United States (HTSUS). The certifi- cation shall be made, prior to expor- tation of the beef, by an official of the government of the exporting country and filed with Customs with the entry summary or with the entry when the entry summary is filed at the time of entry. The requirements of this section shall be in addition to those require- ments contained in 9 CFR 327.4. Appro- priate officials of the exporting coun- try should consult with the U.S. De- partment of Agriculture as to the beef grades or standards within their coun- try that satisfy the certification re- quirement. Exporters or importers of beef to be entered under the provisions of subheadings 0201.20.10, 0201.30.02, 0202.20.02, 0202.20.10, HTSUS, should consult with the U.S. Department of Agriculture prior to exportation in order to insure that the beef will sat- isfy the certification requirements. This certification is relevant only to U.S. Customs tariff classification and is not applicable to marketing of beef under U.S. Department of Agriculture grading standards, a matter within

U.S. Department of Agriculture’s juris- diction.

CERTIFICATION

I hereby certify to the best of my knowl- edge and belief that the herein described fresh, chilled, or frozen beef, meets the speci- fications prescribed in regulations issued by the U.S. Department of Agriculture (7 CFR 2853.106 (a) and (b)).

(b) Appropriate officials of the fol- lowing countries have agreed with the U.S. Department of Agriculture as to the grades or standards for fresh, chilled, or frozen beef within their re- spective countries which will satisfy the certification requirements of para- graph (a) of this section: Canada.

[T.D. 82–8, 47 FR 945, Jan. 8, 1982, as amended by T.D. 89–1, 53 FR 51252, Dec. 21, 1988; T.D. 97–82, 62 FR 51769, Oct. 3, 1997]

WATCHES AND WATCH MOVEMENTS FROM U.S. INSULAR POSSESSIONS

§§ 10.181–10.182 [Reserved]

CIVIL AIRCRAFT

§ 10.183 Duty-free entry of civil air- craft, aircraft engines, ground flight simulators, parts, components, and subassemblies.

(a) Applicability. Except as provided in paragraph (b) of this section, this section applies to aircraft, aircraft en- gines, and ground flight simulators, in- cluding their parts, components, and subassemblies, that qualify as civil air- craft under General Note 6(b) ofthe Harmonized Tariff Schedule of the United States (HTSUS) by meeting the following requirements:

(1) The aircraft, aircraft engines, ground flight simulators, or their parts, components, and subassemblies, are used as original or replacement equipment in the design, development, testing, evaluation, manufacture, re- pair, maintenance, rebuilding, modi- fication, or conversion of aircraft; and

(2) They are either: (i) Manufactured or operated pursu-

ant to a certificate issued by the Ad- ministrator of the Federal Aviation Administration (FAA) under 49 U.S.C. 44704 or pursuant to the approval of the airworthiness authority in the country of exportation, if that approval is rec- ognized by the FAA as an acceptable substitute for the FAA certificate;

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00175 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

166

19 CFR Ch. I (4–1–12 Edition)§ 10.183

(ii) Covered by an application for such certificate, submitted to and ac- cepted by the FAA, filed by an existing type and production certificate holder pursuant to 49 U.S.C. 44702 and imple- menting regulations (Federal Aviation Administration Regulations, title 14, Code of Federal Regulations); or

(iii) Covered by an application for such approval or certificate which will be submitted in the future by an exist- ing type and production certificate holder, pending the completion of de- sign or other technical requirements stipulated by the FAA (applicable only to the quantities of parts, components, and subassemblies as are required to meet the stipulation).

(b) Department of Defense or U.S. Coast Guard use. If purchased for use by the Department of Defense or the United States Coast Guard, aircraft, aircraft engines, and ground flight simulators, including their parts, components, and subassemblies, are subject to this sec- tion only if they are used as original or replacement equipment in the design, development, testing, evaluation, man- ufacture, repair, maintenance, rebuild- ing, modification, or conversion of air- craft and meet the requirements of ei- ther paragraph (a)(2)(i) or (a)(2)(ii) of this section.

(c) Claim for admission free of duty. Merchandise qualifying under para- graph (a) or paragraph (b) of this sec- tion is entitled to duty-free admission in accordance with General Note 6, HTSUS, upon meeting the require- ments of this section. An importer will make a claim for duty-free admission under this section and General Note 6, HTSUS, by properly entering quali- fying merchandise under a provision for which the rate of duty ‘‘Free (C)’’ appears in the ‘‘Special’’ subcolumn of the HTSUS and by placing the special indicator ‘‘C’’ on the entry summary. The fact that qualifying merchandise has previously been exported with ben- efit of drawback does not preclude free entry under this section.

(d) Importer certification. In making a claim for duty-free admission as pro- vided for under paragraph (c) of this section, the importer is deemed to cer- tify, in accordance with General Note 6(a)(ii), HTSUS, that the imported mer- chandise is, as described in paragraph

(a) or paragraph (b) of this section, a civil aircraft or has been imported for use in a civil aircraft and will be so used.

(e) Documentation. Each entry sum- mary claiming duty-free admission for imported merchandise in accordance with paragraph (c) of this section must be supported by documentation to verify the claim for duty-free admis- sion, including the written order or contract and other evidence that the merchandise entered qualifies under General Note 6, HTSUS, as a civil air- craft, aircraft engine, or ground flight simulator, or their parts, components, and subassemblies. Evidence that the merchandise qualifies under the gen- eral note includes evidence of compli- ance with paragraph (a)(1) of this sec- tion concerning use of the merchandise and evidence of compliance with the airworthiness certification require- ment of paragraph (a)(2)(i), (a)(2)(ii), or (a)(2)(iii) of this section, including, as appropriate in the circumstances, an FAA certification; approval of air- worthiness by an airworthiness author- ity in the country of export and evi- dence that the FAA recognizes that ap- proval as an acceptable substitute for an FAA certification; an application for a certification submitted to and ac- cepted by the FAA; a type and produc- tion certificate issued by the FAA; and/ or evidence that a type and production certificate holder will submit an appli- cation for certification or approval in the future pending completion of de- sign or other technical requirements stipulated by the FAA and of estimates of quantities of parts, components, and subassemblies as are required to meet design and technical requirements stip- ulated by the FAA. This documenta- tion need not be filed with the entry summary but must be maintained in accordance with the general note and with the recordkeeping provisions of part 163 of this chapter. Customs may request production of documentation at any time to verify the claim for duty-free admission. Failure to produce documentation sufficient to satisfy the port director that the merchandise qualifies for duty-free admission will result in a denial of duty-free treat- ment and may result in such other

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00176 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

167

U.S. Customs and Border Protection, DHS; Treasury § 10.191

measures permitted under the regula- tions as the port director finds nec- essary to more closely monitor the im- porter’s importations of merchandise claimed to be duty-free under this sec- tion. Proof of end use of the entered merchandise need not be maintained.

(f) Post-entry claim. An importer may file a claim for duty-free treatment under General Note 6, HTSUS, after fil- ing an entry that made no such duty- free claim, by filing a written state- ment with Customs any time prior to liquidation of the entry or prior to the liquidation becoming final. When filed, the written statement constitutes the importer=s claim for duty-free treat- ment under the general note and its certification that the entered merchan- dise is a civil aircraft or has been im- ported for use in a civil aircraft and will be so used. In accordance with General Note 6, HTSUS, any refund re- sulting from a claim made under this paragraph will be without interest, notwithstanding the provision of 19 U.S.C. 1505(c).

(g) Verification. The port director will monitor and periodically audit selected entries made under this section.

[T.D. 02–31, 67 FR 39289, June 7, 2002]

Subpart B—Caribbean Basin Initiative

SOURCE: Sections 10.191 through 10.197 issued by T.D. 84–237, 49 FR 47993, Dec. 7, 1984, unless otherwise noted.

§ 10.191 General. (a) Statutory authority. Subtitle A,

Title II, Pub. L. 98–67, entitled the Car- ibbean Basin Economic Recovery Act (19 U.S.C. 2701–2706) and referred to as the Caribbean Basin Initiative (CBI), authorizes the President to proclaim duty-free treatment for all eligible ar- ticles from any beneficiary country.

(b) Definitions—(1) Beneficiary coun- try. For purposes of § 10.191 through § 10.199 and except as otherwise pro- vided in § 10.195(b), the term ‘‘bene- ficiary country’’ means any country or territory or successor political entity with respect to which there is in effect a proclamation by the President desig- nating such country, territory or suc- cessor political entity as a beneficiary

country in accordance with section 212(a)(1)(A) of the Caribbean Basin Eco- nomic Recovery Act (19 U.S.C. 2702(a)(1)(A)). See General Note 7(a), Harmonized Tariff Schedule of the United States (HTSUS). For purposes of this paragraph, when the word ‘‘former’’ is used in conjunction with the term ‘‘beneficiary country’’, it means a country that ceases to be des- ignated as a beneficiary country under the CBERA because the country has become a party to a free trade agree- ment with the United States. See Gen- eral Note 7(b)(i)(C), HTSUS.

(2) Eligible articles. Except as provided herein, for purposes of § 10.191(a), the term ‘‘eligible articles’’ means any merchandise which is imported di- rectly from a beneficiary country as provided in § 10.193 and which meets the country of origin criteria set forth in § 10.195 or in § 10.198b. The following merchandise shall not be considered el- igible articles entitled to duty-free treatment under the CBI.

(i) Textile and apparel articles which were not eligible articles for purposes of the CBI on January 1, 1994, as the CBI was in effect on that date.

(ii) Footwear not designated on Au- gust 5, 1983, as eligible articles for the purpose of the Generalized System of Preferences under Title V, Trade Act of 1974, as amended (19 U.S.C. 2461 through 2467).

(iii) Tuna, prepared or preserved in any manner, in airtight containers.

(iv) Petroleum, or any product de- rived from petroleum, provided for in headings 2709 and 2710, HTSUS.

(v) Watches and watch parts (includ- ing cases, bracelets and straps), of whatever type including, but not lim- ited to, mechanical, quartz digital or quartz analog, if such watches or watch parts contain any material which is the product of any country with re- spect to which HTSUS column 2 rates of duty apply.

(vi) Articles to which reduced rates of duty apply under § 10.198a.

(vii) Sugars, sirups, and molasses, provided for in subheadings 1701.11.00 and 1701.12.00, HTSUS, to the extent that importation and duty-free treat- ment of such articles are limited by Additional U.S. Note 4, Chapter 17, HTSUS.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00177 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

168

19 CFR Ch. I (4–1–12 Edition)§ 10.192

(viii) Articles subject to the provi- sions of the subheadings of Subchapter III, from the beginning through 9903.85.21, Chapter 99, HTSUS, to the extent that such provisions have not been modified or terminated by the President pursuant to section 213(e)(5) of the Caribbean Basin Economic Re- covery Act (19 U.S.C. 2703(e)(5)).

(ix) Merchandise for which duty-free treatment under the CBI is suspended or withdrawn by the President pursu- ant to sections 213 (c)(2), (e)(1), or (f)(3) of the Caribbean Basin Economic Re- covery Act (19 U.S.C. 2703 (c)(2), (e)(1), or (f)(3)).

(3) Wholly the growth, product, or man- ufacture of a beneficiary country. For purposes of § 10.191 through § 10.199, the expression ‘‘wholly the growth, prod- uct, or manufacture of a beneficiary country’’ refers both to any article which has been entirely grown, pro- duced, or manufactured in a bene- ficiary country or two or more bene- ficiary countries and to all materials incorporated in an article which have been entirely grown, produced, or man- ufactured in any beneficiary country or two or more beneficary countries, as distinguished from articles or mate- rials imported into a beneficiary coun- try from a non-beneficiary country whether or not such articles or mate- rials were substantially transformed into new or different articles of com- merce after their importation into the beneficiary country.

(4) Entered. For purposes of § 10.191 through § 10.199, the term ‘‘entered’’ means entered, or withdrawn from warehouse for consumption, in the cus- toms territory of the U.S.

[T.D. 84–237, 49 FR 47993, Dec. 7, 1984, as amended by T.D. 89–1, 53 FR 51252, Dec. 21, 1988; T.D. 00–68, 65 FR 59657, Oct. 5, 2000; T.D. 01–17, 66 FR 9645, Feb. 9, 2001; CBP Dec. 10–29, 75 FR 52450, Aug. 26, 2010]

§ 10.192 Claim for exemption from duty under the CBI.

A claim for an exemption from duty on the ground that the CBI applies shall be allowed by the port director only if he is satisfied that the require- ments set forth in this section and § 10.193 through § 10.198b have been met. Duty-free treatment may be claimed at the time of filing the entry summary

by placing the symbol ‘‘E’’ as a prefix to the HTSUS subheading number for each article for which such treatment is claimed on that document.

[T.D. 84–237, 49 FR 47993, Dec. 7, 1984, as amended by T.D. 89–1, 53 FR 51252, Dec. 21, 1988; T.D. 94–47, 59 FR 25570, May 17, 1994; T.D. 00–68, 65 FR 59658, Oct. 5, 2000]

§ 10.193 Imported directly.

To qualify for treatment under the CBI, an article shall be imported di- rectly from a beneficiary country into the customs territory of the U.S. For purposes of § 10.191 through § 10.198b the words ‘‘imported directly’’ mean:

(a) Direct shipment from any bene- ficiary country to the U.S. without passing through the territory of any non-beneficiary country; or

(b) If the shipment is from any bene- ficiary country to the U.S. through the territory of any non-beneficiary coun- try, the articles in the shipment do not enter into the commerce of any non- beneficiary country while en route to the U.S. and the invoices, bills of lad- ing, and other shipping documents show the U.S. as the final destination; or

(c) If the shipment is from any bene- ficiary country to the U.S. through the territory of any non-beneficiary coun- try, and the invoices and other docu- ments do not show the U.S. as the final destination, the articles in the ship- ment upon arrival in the U.S. are im- ported directly only if they:

(1) Remained under the control of the customs authority of the intermediate country;

(2) Did not enter into the commerce of the intermediate country except for the purpose of sale other than at retail, and the port director is satisfied that the importation results from the origi- nal commericial transaction between the importer and the producer or the latter’s sales agent; and

(3) Were not subjected to operations other than loading and unloading, and other activities necessary to preserve the articles in good condition.

[T.D. 84–237, 49 FR 47993, Dec. 7, 1984, as amended by T.D. 00–68, 65 FR 59658, Oct. 5, 2000]

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00178 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

169

U.S. Customs and Border Protection, DHS; Treasury § 10.195

§ 10.194 Evidence of direct shipment. (a) Documents constituting evidence of

direct shipment. The port director may require that appropriate shipping pa- pers, invoices, or other documents be submitted within 60 days of the date of entry as evidence that the articles were ‘‘imported directly’’, as that term is defined in § 10.193. Any evidence of di- rect shipment required shall be subject to such verification as deemed nec- essary by the port director.

(b) Waiver of evidence of direct ship- ment. The port director may waive the submission of evidence of direct ship- ment when otherwise satisfied, taking into consideration the kind and value of the merchandise, that the merchan- dise was, in fact, imported directly and that it otherwise clearly qualifies for treatment under the CBI.

§ 10.195 Country of origin criteria. (a) Articles produced in a beneficiary

country—(1) General. Except as provided herein, any article which is either wholly the growth, product, or manu- facture of a beneficiary country or a new or different article of commerce which has been grown, produced, or manufactured in a beneficiary country, may qualify for duty-free entry under the CBI. No article or material shall be considered to have been grown, pro- duced, or manufactured in a bene- ficiary country by virtue of having merely undergone simple (as opposed to complex or meaningful) combining or packaging operations, or mere dilu- tion with water or mere dilution with another substance that does not mate- rially alter the characteristics of the article. Duty-free entry under the CBI may be accorded to an article only if the sum of the cost or value of the ma- terial produced in a beneficiary coun- try or countries, plus the direct costs of processing operations performed in a beneficiary country or countries, is not less than 35 percent of the appraised value of the article at the time it is en- tered.

(2) Combining, packaging, and diluting operations. No article which has under- gone only a simple combining or pack- aging operation or a mere dilution in a beneficiary country within the mean- ing of paragraph (a)(1) of this section shall be entitled to duty-free treatment

even though the processing operation causes the article to meet the value re- quirement set forth in that paragraph.

(i) For purposes of this section, sim- ple combining or packaging operations and mere dilution include, but are not limited to, the following processes:

(A) The addition of batteries to de- vices;

(B) Fitting together a small number of components by bolting, glueing, sol- dering etc.;

(C) Blending foreign and beneficiary country tobacco;

(D) The addition of substances such as anticaking agents, preservatives, wetting agents, etc.;

(E) Repacking or packaging compo- nents together;

(F) Reconstituting orange juice by adding water to orange juice con- centrate; and

(G) Diluting chemicals with inert in- gredients to bring them to standard de- grees of strength.

(ii) For purposes of this section, sim- ple combining or packaging operations and mere dilution shall not be taken to include processes such as the following:

(A) The assembly of a large number of discrete components onto a printed circuit board;

(B) The mixing together of two bulk medicinal substances followed by the packaging of the mixed product into individual doses for retail sale;

(C) The addition of water or another substance to a chemical compound under pressure which results in a reac- tion creating a new chemical com- pound; and

(D) A simple combining or packaging operation or mere dilution coupled with any other type of processing such as testing or fabrication (e.g., a simple assembly of a small number of compo- nents, one of which was fabricated in the beneficiary country where the as- sembly took place).

The fact that an article or material has undergone more than a simple com- bining or packaging operation or mere dilution is not necessarily dispositive of the question of whether that proc- essing constitutes a substantial trans- formation for purposes of determining the country of origin of the article or material.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00179 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

170

19 CFR Ch. I (4–1–12 Edition)§ 10.196

(b) Commonwealth of Puerto Rico, U.S. Virgin Islands, and former beneficiary countries—(1) General. For purposes of determining the percentage referred to in paragraph (a) of this section, the term ‘‘beneficiary country’’ includes the Commonwealth of Puerto Rico, U.S. Virgin Islands, and any former beneficiary countries. Any cost or value of materials or direct costs of processing operations attributable to the U.S. Virgin Islands or any former beneficiary country must be included in the article prior to its final expor- tation from a beneficiary country to the United States.

(2) Manufacture in the Commonwealth of Puerto Rico after final exportation. Notwithstanding the provisions of 19 U.S.C. 1311, if an article from a bene- ficiary country is entered under bond for processing or use in manufacturing in the Commonwealth of Puerto Rico, no duty will be imposed on the with- drawal from warehouse for consump- tion of the product of that processing or manufacturing provided that:

(i) The article entered in the ware- house in the Commonwealth of Puerto Rico was grown, produced, or manufac- tured in a beneficiary country within the meaning of paragraph (a) of this section and was imported directly from a beneficiary country within the mean- ing of § 10.193; and

(ii) At the time of its withdrawal from the warehouse, the product of the processing or manufacturing in the Commonwealth of Puerto Rico meets the 35 percent value-content require- ment prescribed in paragraph (a) of this section.

(c) Materials produced in the U.S. For purposes of determining the percentage referred to in paragraph (a) of this sec- tion, an amount not to exceed 15 per- cent of the appraised value of the arti- cle at the time it is entered may be at- tributed to the cost or value of mate- rials produced in the customs territory of the U.S. (other than the Common- wealth of Puerto Rico). In the case of materials produced in the customs ter- ritory of the U.S., the provisions of § 10.196 shall apply.

(d) Textile components cut to shape in the U.S. The percentage referred to in paragraph (c) of this section may be at- tributed in whole or in part to the cost

or value of a textile component that is cut to shape (but not to length, width, or both) in the U.S. (including the Commonwealth of Puerto Rico) from foreign fabric and exported to a bene- ficiary country for assembly into an article that is then returned to the U.S. and entered, or withdrawn from warehouse, for consumption on or after July 1, 1996. For purposes of this para- graph, the terms ‘‘textile component’’ and ‘‘fabric’’ have reference only to goods covered by the definition of ‘‘textile or apparel product’’ set forth in § 102.21(b)(5) of this chapter.

(e) Articles wholly grown, produced, or manufactured in a beneficiary country. Any article which is wholly the growth, product, or manufacture of a beneficiary country, including articles produced or manufactured in a bene- ficiary country exclusively from mate- rials which are wholly the growth, product, or manufacture of a bene- ficiary country or countries, shall nor- mally be presumed to meet the require- ments set forth in paragraph (a) of this section.

(f) Country of origin marking. The gen- eral country of origin marking require- ments that apply to all importations are also applicable to articles imported under the CBI.

[T.D. 84–237, 49 FR 47993, Dec. 7, 1984; 49 FR 49575, Dec. 20, 1984, as amended by T.D. 95–69, 60 FR 46197, Sept. 5, 1995; T.D. 95–69, 60 FR 55995, Nov. 6, 1996; T.D. 00–68, 65 FR 59658, Oct. 5, 2000; CBP Dec. 10–29, 75 FR 52450, Aug. 26, 2010]

§ 10.196 Cost or value of materials pro- duced in a beneficiary country or countries.

(a) ‘‘Materials produced in a bene- ficiary country or countries’’ defined. For purposes of § 10.195, the words ‘‘mate- rials produced in a beneficiary country or countries’’ refer to those materials incorporated in an article which are ei- ther:

(1) Wholly the growth, product, or manufacture of a beneficiary country or two or more beneficiary countries; or

(2) Subject to the limitations set forth in § 10.195(a), substantially trans- formed in any beneficiary country or two or more beneficiary countries into a new or different article of commerce

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00180 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

171

U.S. Customs and Border Protection, DHS; Treasury § 10.196

which is then used in any beneficiary country in the production or manufac- ture of a new or different article which is imported directly into the U.S.

Example 1. A raw, perishable skin of an ani- mal grown in one beneficiary country is sent to another beneficiary country where it is tanned to create nonperishable ‘‘crust leath- er’’. The tanned product is then imported di- rectly into the U.S. Because the material of which the imported article is composed is wholly the growth, product, or manufacture of one of more beneficiary countries, the en- tire cost or value of that material may be counted toward the 35 percent value require- ment set forth in § 10.195.

Example 2. A raw, perishable skin of an ani- mal grown in a non-beneficiary country is sent to a beneficiary country where it is tanned to create nonperishable ‘‘crust leath- er’’. The tanned skin is then imported di- rectly into the U.S. Although the tanned skin represents a new or different article of commerce produced in a beneficiary country within the meaning of § 10.195(a), the cost or value of the raw skin may not be counted to- ward the 35 percent value requirement be- cause (1) the tanned material of which the imported article is composed is not wholly the growth, product, or manufacture of a beneficiary country and (2) the tanning oper- ation creates the imported article itself rather than an intermediate article which is then used in the beneficiary country in the production or manufacture of an article im- ported into the U.S. The tanned skin would be eligible for duty-free treatment only if the direct costs attributable to the tanning operation represent at least 35 percent of the appraised value of the imported article.

Example 3. A raw, perishable skin of an ani- mal grown in a non-beneficiary country is sent to a beneficiary country where it is tanned to create nonperishable ‘‘crust leath- er’’. The tanned material is then cut, sewn and assembled with a metal buckle imported from a non-beneficiary country to create a finished belt which is imported directly into the U.S. Because the operations performed in the beneficiary country involved both the substantial transformation of the raw skin into a new or different article and the use of that intermediate article in the production or manufacture of a new or different article imported into the U.S., the cost or value of the tanned material used to make the im- ported article may be counted toward the 35 percent value requirement. The cost or value of the metal buckle imported into the bene- ficiary country may not be counted toward the 35 percent value requirement because the buckle was not substantially transformed in the beneficiary country into a new or dif- ferent article prior to its incorporation in the finished belt.

Example 4. A raw, perishable skin of an ani- mal grown in the U.S. Virgin Islands is sent to a beneficiary country where it is tanned to create nonperishable ‘‘crust leather’’, which is then imported directly into the U.S. The tanned skin represents a new or dif- ferent article of commerce produced in a beneficiary country within the meaning of § 10.195(a), and under § 10.195(b), the raw skin from which the tanned product was made is considered to have been grown in a bene- ficiary country for the purpose of applying the 35 percent value requirement. The tanned material of which the imported arti- cle is composed is considered to be wholly the growth, product, or manufacture of one or more beneficiary countries with the result that the entire cost or value of that material may be counted toward the 35 percent value requirement.

(b) Questionable origin. When the ori- gin of a material either is not ascer- tainable or is not satisfactorily dem- onstrated to the port director, the ma- terial shall not be considered to have been grown, produced, or manufactured in a beneficiary country.

(c) Determination of cost or value of materials produced in a beneficiary coun- try. (1) The cost or value of materials produced in a beneficiary country or countries includes:

(i) The manufacturer’s actual cost for the materials;

(ii) When not included in the manu- facturer’s actual cost for the materials, the freight, insurance, packing, and all other costs incurred in transporting the materials to the manufacturer’s plant;

(iii) The actual cost of waste or spoil- age (material list), less the value of re- coverable scrap; and

(iv) Taxes and/or duties imposed on the materials by any beneficiary coun- try, provided they are not remitted upon exportation.

(2) Where a material is provided to the manufacturer without charge, or at less than fair market value, its cost or value shall be determined by com- puting the sum of:

(i) All expenses incurred in the growth, production, or manufacture of the material, including general ex- penses;

(ii) An amount for profit; and (iii) Freight, insurance, packing, and

all other costs incurred in transporting the material to the manufacturer’s plant.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00181 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

172

19 CFR Ch. I (4–1–12 Edition)§ 10.197

If the pertinent information needed to compute the cost or value of a material is not available, the appraising officer may ascertain or estimate the value thereof using all reasonable ways and means at his disposal.

§ 10.197 Direct costs of processing op- erations performed in a beneficiary country or countries.

(a) Items included in the direct costs of processing operations. As used in § 10.195 and § 10.198, the words ‘‘direct costs of processing operations’’ mean those costs either directly incurred in, or which can be reasonably allocated to, the growth, production, manufacture, or assembly of the specific merchan- dise under consideration. Such costs include, but are not limited to the fol- lowing, to the extent that they are in- cludable in the appraised value of the imported merchandise:

(1) All actual labor costs involved in the growth, production, manufacture or assembly of the specific merchan- dise, including fringe benefits, on-the- job training, and the cost of engineer- ing, supervisory, quality control, and similar personnel;

(2) Dies, molds, tooling, and deprecia- tion on machinery and equipment which are allocable to the specific mer- chandise;

(3) Research, development, design, engineering, and blueprint costs inso- far as they are allocable to the specific merchandise and;

(4) Costs of inspecting and testing the specific merchandise.

(b) Items not included in the direct costs of processing operations. Those items which are not included within the meaning of the words ‘‘direct costs of processing operations’’ are those which are not directly attributable to the merchandise under consideration or are not ‘‘costs’’ of manufacturing the prod- uct. These include, but are not limited to:

(1) Profit; and

(2) General expenses of doing business which are either not allocable to the specific merchandise or are not related to the growth, production, manufac- ture, or assembly of the merchandise, such as administrative salaries, cas- ualty and liability insurance, adver- tising, and salesmen’s salaries, com- missions, or expenses.

[T.D. 84–237, 49 FR 47993, Dec. 7, 1984; 49 FR 49575, Dec. 20, 1984]

§ 10.198 Evidence of country of origin. (a) Shipments covered by a formal

entry—(1) Articles not wholly the growth, product, or manufacture of a beneficiary country—(i) Declaration. In a case in- volving an article covered by a formal entry which is not wholly the growth, product, or manufacture of a single beneficiary country, the exporter or other appropriate party having knowl- edge of the relevant facts in the bene- ficiary country where the article was produced or last processed shall be pre- pared to submit directly to the port di- rector, upon request, a declaration set- ting forth all pertinent detailed infor- mation concerning the production or manufacture of the article. When re- quested by the port director, the dec- laration shall be prepared in substan- tially the following form:

CBI DECLARATION

I, llllllllllllll, (name), hereby declare that the articles de- scribed below (a) were produced or manufac- tured in llllllll (country) by means of processing operations performed in that country as set forth below and were also sub- jected to processing operations in the other beneficiary country or countries (including the Commonwealth of Puerto Rico and the U.S. Virgin Islands) as set forth below and (b) incorporate materials produced in the country named above or in any other bene- ficiary country or countries (including the Commonwealth of Puerto Rico and the U.S. Virgin Islands) or in the customs territory of the United States (other than the Common- wealth of Puerto Rico) as set forth below:

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00182 Fmt 8010 Sfmt 8003 Q:\19\19V1.TXT ofr150 PsN: PC150

173

U.S. Customs and Border Protection, DHS; Treasury § 10.198a

Number and date of invoices Description of articles and

quantity

Processing operations per- formed on articles

Material produced in a bene- ficiary country or in the U.S.

Description of processing op- erations and

country of processing

Direct costs of processing op-

erations

Description of material, pro- duction proc-

ess, and coun- try of produc-

tion

Cost or value of material

Date lllllllllllllllllllll Address lllllllllllllllllll Signature llllllllllllllllll Title lllllllllllllllllllll

(ii) Retention of records and submission of declaration. The information nec- essary for preparation of the declara- tion shall be retained in the files of the party responsible for its preparation and submission for a period of 5 years. In the event that the port director re- quests submission of the declaration during the 5-year period, it shall be submitted by the appropriate party di- rectly to the port director within 60 days of the date of the request or such additional period as the port director may allow for good cause shown. Fail- ure to submit the declaration in a timely fashion will result in a denial of duty-free treatment.

(iii) Value added after final expor- tation. In a case in which value is added to an article in a bonded warehouse or in a foreign-trade zone in the Common- wealth of Puerto Rico or in the U.S. after final exportation of the article from a beneficiary country, in order to ensure compliance with the value re- quirement under § 10.195(a), the declara- tion provided for in paragraph (a)(1)(i) of this section shall be filed by the im- porter or consignee with the entry summary as evidence of the country of origin. The declaration shall be prop- erly completed by the party respon- sible for the addition of such value.

(2) Merchandise wholly the growth, product, or manufacture of a beneficiary country. In a case involving merchan- dise covered by a formal entry which is wholly the growth, product, or manu- facture of a single beneficiary country, a statement to that effect shall be in- cluded on the commercial invoice pro- vided to Customs.

(b) Shipments covered by an informal entry. Although the filing of the dec- laration provided for in paragraph (a)(1)(i) of this section will not be re- quired for a shipment covered by an in- formal entry, the port director may re- quire such other evidence of country of origin as deemed necessary.

(c) Verification of documentation. Any evidence of country of origin submitted under this section shall be subject to such verification as the port director deems necessary. In the event that the port director is prevented from obtain- ing the necessary verification, the port director may treat the entry as duti- able.

[T.D. 94–47, 59 FR 25570, May 17, 1994]

§ 10.198a Duty reduction for certain leather-related articles.

Except as otherwise provided in § 10.233, reduced rates of duty as pro- claimed by the President will apply to handbags, luggage, flat goods, work gloves, and leather wearing apparel that were not designated on August 5, 1983, as eligible articles for purposes of the Generalized System of Preferences under Title V, Trade Act of 1974, as amended (19 U.S.C. 2461 through 2467), provided that the article in question at the time it is entered:

(a) Was grown, produced, or manufac- tured in a beneficiary country within the meaning of § 10.195;

(b) Meets the 35 percent value-con- tent requirement prescribed in § 10.195; and

(c) Was imported directly from a ben- eficiary country within the meaning of § 10.193.

[T.D. 00–68, 65 FR 59658, Oct. 5, 2000]

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00183 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

174

19 CFR Ch. I (4–1–12 Edition)§ 10.198b

§ 10.198b Products of Puerto Rico processed in a beneficiary country.

Except in the case of any article de- scribed in § 10.191(b)(2)(i) through (vi), the duty-free treatment provided for under the CBI will apply to an article that is the growth, product, or manu- facture of the Commonwealth of Puer- to Rico and that is by any means ad- vanced in value or improved in condi- tion in a beneficiary country, provided that:

(a) If any materials are added to the article in the beneficiary country, those materials consist only of mate- rials that are a product of a beneficiary country or the United States; and

(b) The article is imported directly from the beneficiary country into the customs territory of the United States within the meaning of § 10.193.

[T.D. 00–68, 65 FR 59658, Oct. 5, 2000]

§ 10.199 Duty-free entry for certain beverages produced in Canada from Caribbean rum.

(a) General. A spirituous beverage that is imported directly from the ter- ritory of Canada and that is classifi- able under subheading 2208.40 or 2208.90, Harmonized Tariff Schedule of the United States (HTSUS), will be enti- tled, upon entry or withdrawal from warehouse for consumption, to duty- free treatment under section 213(a)(6) of the Caribbean Basin Economic Re- covery Act (19 U.S.C. 2703(a)(6)), also known as the Caribbean Basin Initia- tive (CBI), if the spirituous beverage has been produced in the territory of Canada from rum, provided that the rum:

(1) Is the growth, product, or manu- facture either of a beneficiary country or of the U.S. Virgin Islands;

(2) Was imported directly into the territory of Canada from a beneficiary country or from the U.S. Virgin Is- lands; and

(3) Accounts for at least 90 percent of the alcoholic content by volume of the spirituous beverage.

(b) Claim for exemption from duty under CBI. A claim for an exemption from duty for a spirituous beverage under section 213(a)(6) of the Caribbean Basin Economic Recovery Act (19 U.S.C. 2703(a)(6)) may be made by en- tering such beverage under subheading

9817.22.05, HTSUS, on the entry sum- mary document or its electronic equiv- alent. In order to claim the exemption, the importer must have the records de- scribed in paragraphs (d), (e), (f) and (g) of this section so that, upon Customs request, the importer can establish that:

(1) The rum used to produce the bev- erage is the growth, product or manu- facture either of a beneficiary country or of the U.S. Virgin Islands;

(2) The rum was shipped directly from a beneficiary country or from the U.S. Virgin Islands to Canada;

(3) The beverage was produced in Canada;

(4) The rum accounts for at least 90% of the alcohol content of the beverage; and

(5) The beverage was shipped directly from Canada to the United States.

(c) Imported directly. For a spirituous beverage imported from Canada to qualify for duty-free entry under the CBI, the spirituous beverage must be imported directly into the customs ter- ritory of the United States from Can- ada; and the rum used in its production must have been imported directly into the territory of Canada either from a beneficiary country or from the U.S. Virgin Islands.

(1) ‘‘Imported directly’’ into the cus- toms territory of the United States from Canada means:

(i) Direct shipment from the terri- tory of Canada to the U.S. without passing through the territory of any other country; or

(ii) If the shipment is from the terri- tory of Canada to the U.S. through the territory of any other country, the spirituous beverages do not enter into the commerce of any other country while en route to the U.S.; or

(iii) If the shipment is from the terri- tory of Canada to the U.S. through the territory of another country, and the invoices and other documents do not show the U.S. as the final destination, the spirituous beverages in the ship- ment are imported directly only if they:

(A) Remained under the control of the customs authority of the inter- mediate country;

(B) Did not enter into the commerce of the intermediate country except for

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00184 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

175

U.S. Customs and Border Protection, DHS; Treasury § 10.199

the purpose of sale other than at retail, and the port director is satisfied that the importation results from the origi- nal commercial transaction between the importer and the producer or the latter’s sales agent; and

(C) Were not subjected to operations other than loading and unloading, and other activities necessary to preserve the products in good condition.

(2) ‘‘Imported directly’’ from a bene- ficiary country or from the U.S. Virgin Islands into the territory of Canada means:

(i) Direct shipment from a bene- ficiary country or from the U.S. Virgin Islands into the territory of Canada without passing through the territory of any non-beneficiary country; or

(ii) If the shipment is from a bene- ficiary country or from the U.S. Virgin Islands into the territory of Canada through the territory of any non-bene- ficiary country, the rum does not enter into the commerce of any non-bene- ficiary country while en route to Can- ada; or

(iii) If the shipment is from a bene- ficiary country or from the U.S. Virgin Islands into the territory of Canada through the territory of any non-bene- ficiary country, the rum in the ship- ment is imported directly into the ter- ritory of Canada only if it:

(A) Remained under the control of the customs authority of the inter- mediate country;

(B) Did not enter into the commerce of the intermediate country except for the purpose of sale other than at retail; and

(C) Was not subjected to operations in the intermediate country other than loading and unloading, and other ac- tivities necessary to preserve the prod- uct in good condition.

(d) Evidence of direct shipment—(1) Spirituous beverages imported from Can- ada. The importer must be prepared to provide to the port director, if re- quested, documentary evidence that the spirituous beverages were imported directly from the territory of Canada, as described in paragraph (c)(1) of this section. This evidence may include documents such as a bill of lading, in- voice, air waybill, freight waybill, or cargo manifest. Any evidence of the di- rect shipment of these spirituous bev-

erages from Canada into the U.S. may be subject to such verification as deemed necessary by the port director.

(2) Rum imported into Canada from beneficiary country or U.S. Virgin Is- lands. The importer must be prepared to provide to the port director, if re- quested, evidence that the rum used in producing the spirituous beverages was imported directly into the territory of Canada from a beneficiary country or from the U.S. Virgin Islands, as de- scribed in paragraph (c)(2) of this sec- tion. This evidence may include docu- ments such as a Canadian customs entry, Canadian customs invoice, Cana- dian customs manifest, cargo manifest, bill of lading, landing certificate, air- way bill, or freight waybill. Any evi- dence of the direct shipment of the rum from a beneficiary country or from the U.S. Virgin Islands into the territory of Canada for use there in producing the spirituous beverages may be sub- ject to such verification as deemed nec- essary by the port director.

(e) Origin of rum used in production of the spirituous beverage—(1) Origin cri- teria. In order for a spirituous beverage covered by this section to be entitled to duty-free entry under the CBI, the rum used in producing the spirituous beverage in the territory of Canada must be wholly the growth, product, or manufacture either of a beneficiary country under the CBI or of the U.S. Virgin Islands, or must constitute a new or different article of commerce that was produced or manufactured in a beneficiary country or in the U.S. Virgin Islands. Such rum will not be considered to have been grown, pro- duced, or manufactured in a bene- ficiary country or in the U.S. Virgin Is- lands by virtue of having merely under- gone blending, combining or packaging operations, or mere dilution with water or mere dilution with another sub- stance that does not materially alter the characteristics of the product.

(2) Evidence of origin of rum—(i) Dec- laration. The importer must be pre- pared to submit directly to the port di- rector, if requested, a declaration pre- pared and signed by the person who produced or manufactured the rum, af- firming that the rum is the growth,

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00185 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

176

19 CFR Ch. I (4–1–12 Edition)§ 10.199

product or manufacture of a bene- ficiary country or of the U.S. Virgin Is- lands. While no particular form is pre- scribed for the declaration, it must in- clude all pertinent information con- cerning the processing operations by which the rum was produced or manu- factured, the address of the producer or manufacturer, the title of the party signing the declaration, and the date it is signed.

(ii) Records supporting declaration. The supporting records, including those production records, that are necessary for the preparation of the declaration must also be available for submission to the port director if requested. The declaration and any supporting evi- dence as to the origin of the rum may be subject to such verification as deemed necessary by the port director.

(f) Canadian processor declaration; sup- porting documentation—(1) Canadian processor declaration. The importer must be prepared to submit directly to the port director, if requested, a dec- laration prepared by the person who produced the spirituous beverage(s) in Canada, setting forth all pertinent in- formation concerning the production of the beverages. The declaration will be in substantially the following form:

I, llll declare that the spirituous bev- erages here specified are the products that were produced by me (us), as described below, with the use of rum that was received by me (us); that the rum used in producing the beverages was received by me (us) on

llll (date), from llll (name and ad- dress of owner or exporter in the beneficiary country or in the U.S. Virgin Islands, as ap- plicable); and that such rum accounts for at least 90 percent of the alcoholic content by volume, as shown below, of each spirituous beverage so produced.

Marks and numbers Description of prod-

ucts and of proc- essing

Alcoholic con- tent of prod-

ucts; alcoholic content (%) at-

tributable to rum 1

.................................. ................................. ........................

.................................. ................................. ........................

Marks and numbers Description of prod-

ucts and of proc- essing

Alcoholic con- tent of prod-

ucts; alcoholic content (%) at-

tributable to rum 1

.................................. ................................. ........................

1 The production records must establish, for each lot of bev- erage produced, the quantity of rum the growth, product or manufacture of a CBI beneficiary country or of the U.S. Virgin Islands under 19 U.S.C. 2703(a)(6) that is used in producing the finished beverage; the alcoholic content by volume of the finished beverage; and the alcoholic content by volume of the finished beverage, expressed as a percentage, that is attrib- utable to the qualifying rum. If rum from two or more quali- fying sources (e.g., rum the growth, product or manufacture of a CBI beneficiary country or of the U.S. Virgin Islands and other rum the growth, product or manufacture of another CBI country) are used in processing the beverage, the alcoholic content requirement may be met by aggregating the alcoholic content of the finished beverage that is attributable to rum from each of the qualifying sources used in processing the fin- ished beverage, as reflected in the production records.

Date lllllllllllllllllllll Address lllllllllllllllllll Signature llllllllllllllllll Title lllllllllllllllllllll

(2) Availability of supporting docu- ments. The information, including any supporting documents and records, nec- essary for the preparation of the dec- laration, as described in paragraph (f)(1) of this section, must be available for submission to the port director, if requested. The declaration and any supporting evidence may be subject to such verification as deemed necessary by the port director. The specific docu- mentary evidence necessary to support the declaration consists of those docu- ments and records which satisfactorily establish:

(i) The receipt of the rum by the Ca- nadian processor, including the date of receipt and the name and address of the party from whom the rum was re- ceived (the owner or exporter in the beneficiary country or the U.S. Virgin Islands); and

(ii) For each lot of beverage produced and included in the declaration, the specific identification of the produc- tion lot(s) involved; the quantity of qualifying rum that is used in pro- ducing the finished beverage, including a description of the processing and of the finished products; the alcoholic content by volume of the finished bev- erage; and the alcoholic content by vol- ume of the finished beverage, expressed as a percentage, that is attributable to the qualifying rum.

(g) Importer system for review of nec- essary recordkeeping. The importer will

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00186 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

177

U.S. Customs and Border Protection, DHS; Treasury § 10.202

establish and implement a system of internal controls which demonstrate that reasonable care was exercised in its claim for duty-free treatment under the CBI. These controls should include tests to assure the accuracy and avail- ability of records that establish:

(1) The origin of the rum; (2) The direct shipment of the rum

from a beneficiary country or from the U.S. Virgin Islands to Canada;

(3) The alcohol content of the fin- ished beverage imported from Canada; and

(4) The direct shipment of the fin- ished beverage from Canada to the United States.

(h) Submission of documents to Cus- toms. The importer must be prepared to submit directly to the port director, if requested, those documents and/or sup- porting records as described in para- graphs (d), (e) and (f) of this section, for a period of 5 years from the date of entry of the related spirituous bev- erages under section 213(a)(6) of the Caribbean Basin Economic Recovery Act (19 U.S.C. 2703(a)(6)), as provided in § 163.4(a) of this chapter. If requested, the importer must submit such docu- ments and/or supporting records to the port director within 60 calendar days of the date of the request or such addi- tional period as the port director may allow for good cause shown.

[T.D. 02–59, 67 FR 62882, Oct. 9, 2002]

Subpart C—Andean Trade Preference

SOURCE: Sections 10.201 through 10.208 ap- pear at T.D. 98–76, 63 FR 51292, Sept. 25, 1998, unless otherwise noted.

§ 10.201 Applicability. Title II of Pub. L. 102–182 (105 Stat.

1233), entitled the Andean Trade Pref- erence Act (ATPA) and codified at 19 U.S.C. 3201 through 3206, authorizes the President to proclaim duty-free treat- ment for all eligible articles from any beneficiary country and to designate countries as beneficiary countries. The provisions of §§ 10.202 through 10.207 set forth the legal requirements and proce- dures that apply for purposes of obtain- ing that duty-free treatment for cer- tain articles from a beneficiary coun-

try which are identified for purposes of that treatment in General Note 11, Harmonized Tariff Schedule of the United States (HTSUS), and in the ‘‘Special’’ rate of duty column of the HTSUS. Provisions regarding pref- erential treatment of apparel and other textile articles under the ATPA are contained in §§ 10.241 through 10.248, and provisions regarding preferential treatment of tuna and certain other non-textile articles under the ATPA are contained in §§ 10.251 through 10.257.

[T.D. 03–16, 68 FR 14486, Mar. 25, 2003; 68 FR 67338, Dec. 1, 2003]

§ 10.202 Definitions. The following definitions apply for

purposes of §§ 10.201 through 10.207: (a) Beneficiary country. Except as oth-

erwise provided in § 10.206(b), the term ‘‘beneficiary country’’ refers to any country or successor political entity with respect to which there is in effect a proclamation by the President desig- nating such country or successor polit- ical entity as a beneficiary country in accordance with section 203 of the ATPA (19 U.S.C. 3202).

(b) Eligible articles. The term ‘‘eligi- ble’’ when used with reference to an ar- ticle means merchandise which is im- ported directly from a beneficiary country as provided in § 10.204, which meets the country of origin criteria set forth in § 10.205 and the value-content requirement set forth in § 10.206, and which, if the requirements of § 10.207 are met, is therefore entitled to duty- free treatment under the ATPA. How- ever, the following merchandise shall not be considered eligible articles enti- tled to duty-free treatment under the ATPA:

(1) Textiles and apparel articles which were not eligible articles for purposes of the ATPA on January 1, 1994, as the ATPA was in effect on that date, except as otherwise provided in §§ 10.241 through 10.248;

(2) Rum and tafia classified in sub- heading 2208.40, Harmonized Tariff Schedule of the United States;

(3) Sugars, syrups, and sugar-con- taining products subject to over-quota duty rates under applicable tariff-rate quotas; or

(4) Tuna prepared or preserved in any manner in airtight containers, except

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00187 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

178

19 CFR Ch. I (4–1–12 Edition)§ 10.203

as otherwise provided in §§ 10.251 through 10.257.

(c) Entered. The term ‘‘entered’’ means entered, or withdrawn from warehouse for consumption, in the cus- toms territory of the United States.

(d) Wholly the growth, product, or man- ufacture of a beneficiary country. The ex- pression ‘‘wholly the growth, product, or manufacture of a beneficiary coun- try’’ has the same meaning as that set forth in § 10.191(b)(3) of this part.

[T.D. 98–76, 63 FR 51292, Sept. 25, 1998, as amended by T.D. 03–16, 68 FR 14486, Mar. 25, 2003; 68 FR 67338, Dec. 1, 2003]

§ 10.203 Eligibility criteria in general. An article classifiable under a sub-

heading of the Harmonized Tariff Schedule of the United States for which a rate of duty of ‘‘Free’’ appears in the ‘‘Special’’ subcolumn followed by the symbol ‘‘J’’ or ‘‘J*’’ in paren- theses is eligible for duty-free treat- ment, and will be accorded such treat- ment, if each of the following require- ments is met:

(a) Imported directly. The article is imported directly from a beneficiary country as provided in § 10.204.

(b) Country of origin criteria. The arti- cle complies with the country of origin criteria set forth in § 10.205.

(c) Value content requirement. The ar- ticle complies with the value content requirement set forth in § 10.206.

(d) Filing of claim and submission of supporting documentation. The claim for duty-free treatment is filed, and any required documentation in support of the claim is submitted, in accordance with the procedures set forth in § 10.207.

§ 10.204 Imported directly. In order to be eligible for duty-free

treatment under the ATPA, an article shall be imported directly from a bene- ficiary country into the customs terri- tory of the United States. For purposes of this requirement, the words ‘‘im- ported directly’’ mean:

(a) Direct shipment from any bene- ficiary country to the United States without passing through the territory of any non-beneficiary country; or

(b) If shipment from any beneficiary country to the United States was through the territory of a non-bene- ficiary country, the articles in the

shipment did not enter into the com- merce of the non-beneficiary country while en route to the United States, and the invoices, bills of lading, and other shipping documents show the United States as the final destination; or

(c) If shipment from any beneficiary country to the United States was through the territory of a non-bene- ficiary country and the invoices and other documents do not show the United States as the final destination, then the articles in the shipment, upon arrival in the United States, are im- ported directly only if they:

(1) Remained under the control of the customs authority in the intermediate country;

(2) Did not enter into the commerce of the intermediate country except for the purpose of sale other than at retail, and the articles are imported into the United States as a result of the origi- nal commercial transaction between the importer and the producer or the latter’s sales agent; and

(3) Were not subjected to operations in the intermediate country other than loading and unloading, and other ac- tivities necessary to preserve the arti- cles in good condition.

§ 10.205 Country of origin criteria.

(a) General. Except as otherwise pro- vided in paragraph (b) of this section, an article may be eligible for duty-free treatment under the ATPA if the arti- cle is either:

(1) Wholly the growth, product, or manufacture of a beneficiary country; or

(2) A new or different article of com- merce which has been grown, produced, or manufactured in a beneficiary coun- try.

(b) Exceptions. No article shall be eli- gible for duty-free treatment under the ATPA by virtue of having merely un- dergone simple (as opposed to complex or meaningful) combining or packaging operations, or mere dilution with water or mere dilution with another sub- stance that does not materially alter the characteristics of the article. The principles and examples set forth in § 10.195(a)(2) of this part shall apply equally for purposes of this paragraph.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00188 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

179

U.S. Customs and Border Protection, DHS; Treasury § 10.206

§ 10.206 Value content requirement. (a) General. An article may be eligible

for duty-free treatment under the ATPA only if the sum of the cost or value of the materials produced in a beneficiary country or countries, plus the direct costs of processing oper- ations performed in a beneficiary coun- try or countries, is not less than 35 per- cent of the appraised value of the arti- cle at the time it is entered.

(b) Commonwealth of Puerto Rico, U.S. Virgin Islands and CBI beneficiary coun- tries. For purposes of determining the percentage referred to in paragraph (a) of this section, the term ‘‘beneficiary country’’ includes the Commonwealth of Puerto Rico, the U.S. Virgin Islands, and any CBI beneficiary country as de- fined in § 10.191(b)(1) of this part. Any cost or value of materials or direct costs of processing operations attrib- utable to the Virgin Islands or any CBI beneficiary country must be included in the article prior to its final expor- tation to the United States from a ben- eficiary country as defined in § 10.202(a).

(c) Materials produced in the United States. For purposes of determining the percentage referred to in paragraph (a) of this section, an amount not to ex- ceed 15 percent of the appraised value of the article at the time it is entered may be attributed to the cost or value of materials produced in the customs territory of the United States (other than the Commonwealth of Puerto Rico). The principles set forth in para- graph (d)(1) of this section shall apply in determining whether a material is ‘‘produced in the customs territory of the United States’’ for purposes of this paragraph.

(d) Cost or value of materials—(1) ‘‘Ma- terials produced in a beneficiary country or countries’’ defined. For purposes of paragraph (a) of this section, the words materials produced in a beneficiary coun- try or countries refer to those materials incorporated in an article which are ei- ther:

(i) Wholly the growth, product, or manufacture of a beneficiary country or two or more beneficiary countries; or

(ii) Substantially transformed in any beneficiary country or two or more beneficiary countries into a new or dif-

ferent article of commerce which is then used in any beneficiary country as defined in § 10.202(a) in the production or manufacture of a new or different article which is imported directly into the United States. For purposes of this paragraph (d)(1)(ii), no material shall be considered to be substantially trans- formed into a new or different article of commerce by virtue of having mere- ly undergone simple (as opposed to complex or meaningful) combining or packaging operations, or mere dilution with water or mere dilution with an- other substance that does not materi- ally alter the characteristics of the ar- ticle. The examples set forth in § 10.196(a) of this part, and the prin- ciples and examples set forth in § 10.195(a)(2) of this part, shall apply for purposes of the corresponding context under paragraph (d)(1) of this section.

(2) Questionable origin. When the ori- gin of a material either is not ascer- tainable or is not satisfactorily dem- onstrated to the appropriate port direc- tor, the material shall not be consid- ered to have been grown, produced, or manufactured in a beneficiary country or in the customs territory of the United States.

(3) Determination of cost or value of materials. (i) The cost or value of mate- rials produced in a beneficiary country or countries or in the customs terri- tory of the United States includes:

(A) The manufacturer’s actual cost for the materials;

(B) When not included in the manu- facturer’s actual cost for the materials, the freight, insurance, packing, and all other costs incurred in transporting the materials to the manufacturer’s plant;

(C) The actual cost of waste or spoil- age, less the value of recoverable scrap; and

(D) Taxes and/or duties imposed on the materials by any beneficiary coun- try or by the United States, provided they are not remitted upon expor- tation.

(ii) Where a material is provided to the manufacturer without charge, or at less than fair market value, its cost or value shall be determined by com- puting the sum of:

(A) All expenses incurred in the growth, production, or manufacture of

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00189 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

180

19 CFR Ch. I (4–1–12 Edition)§ 10.207

the material, including general ex- penses;

(B) An amount for profit; and (C) Freight, insurance, packing, and

all other costs incurred in transporting the material to the manufacturer’s plant.

(iii) If the pertinent information needed to compute the cost or value of a material is not available, the ap- praising officer may ascertain or esti- mate the value thereof using all rea- sonable ways and means at his dis- posal.

(e) Direct costs of processing oper- ations—(1) Items included. For purposes of paragraph (a) of this section, the words direct costs of processing oper- ations mean those costs either directly incurred in, or which can be reasonably allocated to, the growth, production, manufacture, or assembly of the spe- cific merchandise under consideration. Such costs include, but are not limited to the following, to the extent that they are includable in the appraised value of the imported merchandise:

(i) All actual labor costs involved in the growth, production, manufacture, or assembly of the specific merchan- dise, including fringe benefits, on-the- job training, and the cost of engineer- ing, supervisory, quality control, and similar personnel;

(ii) Dies, molds, tooling, and depre- ciation on machinery and equipment which are allocable to the specific mer- chandise;

(iii) Research, development, design, engineering, and blueprint costs inso- far as they are allocable to the specific merchandise; and

(iv) Costs of inspecting and testing the specific merchandise.

(2) Items not included. For purposes of paragraph (a) of this section, the words ‘‘direct costs of processing operations’’ do not include items which are not di- rectly attributable to the merchandise under consideration or are not costs of manufacturing the product. These in- clude, but are not limited to:

(i) Profit; and (ii) General expenses of doing busi-

ness which either are not allocable to the specific merchandise or are not re- lated to the growth, production, manu- facture, or assembly of the merchan- dise, such as administrative salaries,

casualty and liability insurance, adver- tising, and salesmen’s salaries, com- missions, or expenses.

(f) Articles wholly the growth, product, or manufacture of a beneficiary country. Any article which is wholly the growth, product, or manufacture of a beneficiary country as defined in § 10.202(a), and any article produced or manufactured in a beneficiary country as defined in § 10.202(a) exclusively from materials which are wholly the growth, product, or manufacture of a bene- ficiary country or countries, shall nor- mally be presumed to meet the require- ment set forth in paragraph (a) of this section.

§ 10.207 Procedures for filing duty-free treatment claim and submitting supporting documentation.

(a) Filing claim for duty-free treatment. Except as provided in paragraph (c) of this section, a claim for duty-free treatment under the ATPA may be made at the time of filing the entry summary by placing the symbol ‘‘J’’ as a prefix to the Harmonized Tariff Schedule of the United States sub- heading number applicable to each ar- ticle for which duty-free treatment is claimed on that document.

(b) Shipments covered by a formal entry—(1) Articles not wholly the growth, product, or manufacture of a beneficiary country—(i) Declaration. In a case in- volving an article covered by a formal entry for which duty-free treatment is claimed under the ATPA and which is not wholly the growth, product, or manufacture of a single beneficiary country as defined in § 10.202(a), the ex- porter or other appropriate party hav- ing knowledge of the relevant facts in the beneficiary country as defined in § 10.202(a) where the article was pro- duced or last processed shall be pre- pared to submit directly to the port di- rector, upon request, a declaration set- ting forth all pertinent detailed infor- mation concerning the production or manufacture of the article. When re- quested by the port director, the dec- laration shall be prepared in substan- tially the following form:

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00190 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

181

U.S. Customs and Border Protection, DHS; Treasury § 10.207

ATPA DECLARATION

I, llllll (name), hereby declare that the articles described below (a) were pro- duced or manufactured in llllll (coun- try) by means of processing operations per- formed in that country as set forth below and were also subjected to processing oper- ations in the other beneficiary country or countries (including the Commonwealth of

Puerto Rico, the U.S. Virgin Islands, and any CBI beneficiary country) as set forth below and (b) incorporate materials produced in the country named above or in any other beneficiary country or countries (including the Commonwealth of Puerto Rico, the U.S. Virgin Islands, and any CBI beneficiary country) or in the customs territory of the United States (other than the Common- wealth of Puerto Rico) as set forth below:

Number and date of invoices

Description of arti- cles and quantity

Processing operations performed on arti- cles

Material produced in a beneficiary coun- try or in the U.S.

Description of processing oper-

ations and country of processing

Direct costs of processing oper-

ations

Description of ma- terial, production

process, and coun- try of production

Cost or value of material

Date lllllllllllllllllllll Address lllllllllllllllllll Signature llllllllllllllllll Title lllllllllllllllllllll

(ii) Retention of records and submission of declaration. The information nec- essary for the preparation of the dec- laration shall be retained in the files of the party responsible for its prepara- tion and submission for a period of 5 years. In the event that the port direc- tor requests submission of the declara- tion during the 5-year period, it shall be submitted by the appropriate party directly to the port director within 60 days of the date of the request or such additional period as the port director may allow for good cause shown. Fail- ure to submit the declaration in a timely fashion will result in a denial of duty-free treatment.

(iii) Value added after final expor- tation. In a case in which value is added to an article in the Commonwealth of Puerto Rico or in the United States after final exportation of the article from a beneficiary country as defined in § 10.202(a), in order to ensure compli- ance with the value requirement under § 10.206(a), the declaration provided for in paragraph (b)(1)(i) of this section shall be filed by the importer or con- signee with the entry summary. The declaration shall be completed by the party responsible for the addition of such value.

(2) Articles wholly the growth, product, or manufacture of a beneficiary country. In a case involving an article covered by a formal entry for which duty-free treatment is claimed under the ATPA

and which is wholly the growth, prod- uct, or manufacture of a single bene- ficiary country as defined in § 10.202(a), a statement to that effect shall be in- cluded on the commercial invoice pro- vided to Customs.

(c) Shipments covered by an informal entry. The normal procedure for filing a claim for duty-free treatment as set forth in paragraph (a) of this section need not be followed, and the filing of the declaration provided for in para- graph (b)(1)(i) of this section will not be required, in a case involving a ship- ment covered by an informal entry. However, the port director may require submission of such other evidence of entitlement to duty-free treatment as deemed necessary.

(d) Evidence of direct importation—(1) Submission. The port director may re- quire that appropriate shipping papers, invoices, or other documents be sub- mitted within 60 days of the date of entry as evidence that the articles were ‘‘imported directly’’, as that term is defined in § 10.204.

(2) Waiver. The port director may waive the submission of evidence of di- rect importation when otherwise satis- fied, taking into consideration the kind and value of the merchandise, that the merchandise was, in fact, imported di- rectly and that it otherwise clearly qualifies for duty-free treatment under the ATPA.

(e) Verification of documentation. The documentation submitted under this section to demonstrate compliance with the requirements for duty-free treatment under the ATPA shall be

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00191 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

182

19 CFR Ch. I (4–1–12 Edition)§ 10.211

subject to such verification as the port director deems necessary. In the event that the port director is prevented from obtaining the necessary verification, the port director may treat the entry as fully dutiable.

Subpart D—Textile and Apparel Articles Under the African Growth and Opportunity Act

SOURCE: T.D. 00–67, 65 FR 59676, Oct. 5, 2000, unless otherwise noted.

§ 10.211 Applicability. Title I of Public Law 106–200 (114

Stat. 251), entitled the African Growth and Opportunity Act (AGOA), author- izes the President to extend certain trade benefits to designated countries in sub-Saharan Africa. Section 112 of the AGOA, codified at 19 U.S.C. 3721, provides for the preferential treatment of certain textile and apparel articles from beneficiary countries. The provi- sions of §§ 10.211–10.217 of this part set forth the legal requirements and proce- dures that apply for purposes of obtain- ing preferential treatment pursuant to section 112.

§ 10.212 Definitions. When used in §§ 10.211 through 10.217,

the following terms have the meanings indicated:

Apparel articles. ‘‘Apparel articles’’ means goods classifiable in Chapters 61 and 62 and headings 6501, 6502, 6503, and 6504 and subheadings 6406.99 and 6505.90 of the HTSUS.

Assembled in one or more beneficiary countries. ‘‘Assembled in one or more beneficiary countries’’ when used in the context of a textile or apparel arti- cle has reference to a joining together of two or more components that oc- curred in one or more beneficiary coun- tries, whether or not a prior joining op- eration was performed on the article or any of its components in the United States.

Beneficiary country. ‘‘Beneficiary country’’ means a country listed in section 107 of the African Growth and Opportunity Act (19 U.S.C. 3706) which has been the subject of a finding by the President or his designee, published in the FEDERAL REGISTER, that the coun-

try has satisfied the requirements of section 113 of the African Growth and Opportunity Act (19 U.S.C. 3722) and which the President has designated as a beneficiary sub-Saharan African country under section 506A of the Trade Act of 1974 (19 U.S.C. 2466a).

Cut in one or more beneficiary coun- tries. ‘‘Cut in one or more beneficiary countries’’ when used with reference to apparel articles means that all fabric components used in the assembly of the article were cut from fabric in one or more beneficiary countries.

Foreign. ‘‘Foreign’’ means of a coun- try other than the United States or a beneficiary country.

HTSUS. ‘‘HTSUS’’ means the Har- monized Tariff Schedule of the United States.

Knit-to-shape articles. ‘‘Knit-to- shape,’’ when used with reference to sweaters or other apparel articles, means any apparel article of which 50 percent or more of the exterior surface area is formed by major parts that have been knitted or crocheted directly to the shape used in the apparel arti- cle, with no consideration being given to patch pockets, appliques, or the like. Minor cutting, trimming, or sew- ing of those major parts will not affect the determination of whether an ap- parel article is ‘‘knit-to-shape.’’

Knit-to-shape components. ‘‘Knit-to- shape,’’ when used with reference to textile components, means components that are knitted or crocheted from a yarn directly to a specific shape con- taining a self-start edge. Minor cutting or trimming will not affect the deter- mination of whether a component is ‘‘knit-to-shape.’’

Major parts. ‘‘Major parts’’ means in- tegral components of an apparel article but does not include collars, cuffs, waistbands, plackets, pockets, linings, paddings, trim, accessories, or similar parts or components.

NAFTA. ‘‘NAFTA’’ means the North American Free Trade Agreement en- tered into by the United States, Can- ada, and Mexico on December 17, 1992.

Originating. ‘‘Originating’’ means having the country of origin deter- mined by application of the provisions of § 102.21 of this chapter.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00192 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

183

U.S. Customs and Border Protection, DHS; Treasury § 10.213

Preferential treatment. ‘‘Preferential treatment’’ means entry, or with- drawal from warehouse for consump- tion, in the customs territory of the United States free of duty and free of any quantitative limitations as pro- vided in 19 U.S.C. 3721.

Wholly assembled in. When used with reference to a textile or apparel article in the context of one or more bene- ficiary countries or one or more lesser developed beneficiary countries, the expression ‘‘wholly assembled in’’ means that all of the components of the textile or apparel article (including thread, decorative embellishments, buttons, zippers, or similar compo- nents) were joined together in one or more beneficiary countries or one or more lesser developed beneficiary countries.

Wholly formed fabrics. ‘‘Wholly formed,’’ when used with reference to fabric(s), means that all of the produc- tion processes, starting with polymers, fibers, filaments, textile strips, yarns, twine, cordage, rope, or strips of fabric and ending with a fabric by a weaving, knitting, needling, tufting, felting, en- tangling or other process, took place in the United States or in one or more beneficiary countries.

Wholly formed on seamless knitting ma- chines. ‘‘Wholly formed on seamless knitting machines,’’ when used to de- scribe apparel articles, has reference to a process that created a knit-to-shape apparel article by feeding yarn(s) into a knitting machine to result in that ar- ticle. When taken from the knitting machine, an apparel article created by this process either is in its final form or requires only minor cutting or trim- ming or the addition of minor compo- nents or parts such as patch pockets, appliques, capping, or elastic strip.

Wholly formed yarns. ‘‘Wholly formed,’’ when used with reference to yarns, means that all of the production processes, starting with the extrusion of filament, strip, film, or sheet and in- cluding slitting a film or sheet into strip, or the spinning of all fibers into yarn, or both, and ending with a yarn or plied yarn, took place in a single country.

[T.D. 00–67, 65 FR 59676, Oct. 5, 2000; 65 FR 67260, Nov. 9, 2000, as amended by T.D. 03–15, 68 FR 13824, Mar. 21, 2003]

§ 10.213 Articles eligible for pref- erential treatment.

(a) General. The preferential treat- ment referred to in § 10.211 applies to the following textile and apparel arti- cles that are imported directly into the customs territory of the United States from a beneficiary country:

(1) Apparel articles sewn or otherwise assembled in one or more beneficiary countries from fabrics wholly formed and cut, or from components knit-to- shape, in the United States, from yarns wholly formed in the United States, (including fabrics not formed from yarns, if those fabrics are classifiable under heading 5602 or 5603 of the HTSUS and are wholly formed and cut in the United States) that are entered under subheading 9802.00.80 of the HTSUS;

(2) Apparel articles sewn or otherwise assembled in one or more beneficiary countries from fabrics wholly formed and cut, or from components knit-to- shape, in the United States, from yarns wholly formed in the United States, (including fabrics not formed from yarns, if those fabrics are classifiable under heading 5602 or 5603 of the HTSUS and are wholly formed and cut in the United States) that are entered under Chapter 61 or 62 of the HTSUS, if, after that assembly, the articles would have qualified for entry under subheading 9802.00.80 of the HTSUS but for the fact that the articles were em- broidered or subjected to stone-wash- ing, enzyme-washing, acid washing, perma-pressing, oven-baking, bleach- ing, garment-dyeing, screen printing, or other similar processes in a bene- ficiary country;

(3) Apparel articles sewn or otherwise assembled in one or more beneficiary countries with thread formed in the United States from fabrics wholly formed in the United States and cut in one or more beneficiary countries from yarns wholly formed in the United States, or from components knit-to- shape in the United States from yarns wholly formed in the United States, or both (including fabrics not formed from yarns, if those fabrics are classifi- able under heading 5602 or 5603 of the HTSUS and are wholly formed in the United States).

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00193 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

184

19 CFR Ch. I (4–1–12 Edition)§ 10.213

(4) Apparel articles wholly assembled in one or more beneficiary countries from fabric wholly formed in one or more beneficiary countries from yarns originating either in the United States or one or more beneficiary countries (including fabrics not formed from yarns, if those fabrics are classified under heading 5602 or 5603 of the HTSUS and are wholly formed in one or more beneficiary countries), or from components knit-to-shape in one or more beneficiary countries from yarns originating either in the United States or in one or more beneficiary coun- tries, or apparel articles wholly formed on seamless knitting machines in a beneficiary country from yarns origi- nating either in the United States or in one or more beneficiary countries, sub- ject to the applicable quantitative limit published in the FEDERAL REG- ISTER pursuant to U.S. Note 2, Sub- chapter XIX, Chapter 98, HTSUS;

(5) Apparel articles wholly assem- bled, or knit-to-shape and wholly as- sembled, or both, in one or more lesser developed beneficiary countries regard- less of the country of origin of the fab- ric or the yarn used to make the arti- cles, subject to the applicable quan- titative limit published in the FEDERAL REGISTER pursuant to U.S. Note 2, Sub- chapter XIX, Chapter 98, HTSUS;

(6) Sweaters, in chief weight of cash- mere, knit-to-shape in one or more beneficiary countries and classifiable under subheading 6110.10 of the HTSUS;

(7) Sweaters, containing 50 percent or more by weight of wool measuring 21.5 microns in diameter or finer, knit-to- shape in one or more beneficiary coun- tries;

(8) Apparel articles, other than bras- sieres classifiable under subheading 6212.10, HTSUS, that are both cut (or knit-to-shape) and sewn or otherwise assembled in one or more beneficiary countries, from fabrics or yarn that is not formed in the United States or a beneficiary country, provided that ap- parel articles of those fabrics or yarn would be considered an originating good under General Note 12(t), HTSUS, if the apparel articles had been im- ported directly from Canada or Mexico;

(9) Apparel articles that are both cut (or knit-to-shape) and sewn or other- wise assembled in one or more bene-

ficiary countries from fabrics or yarn that the President or his designee has designated in the FEDERAL REGISTER as not available in commercial quantities in the United States;

(10) A handloomed, handmade, or folklore article of a beneficiary coun- try or countries that is certified as a handloomed, handmade, or folklore ar- ticle by the competent authority of the beneficiary country or countries, pro- vided that the President or his des- ignee has determined that the article in question will be treated as being a handloomed, handmade, or folklore ar- ticle.

(11) Apparel articles sewn or other- wise assembled in one or more bene- ficiary countries with thread formed in the United States:

(i) From components cut in the United States and in one or more bene- ficiary countries from fabric wholly formed in the United States from yarns wholly formed in the United States (in- cluding fabrics not formed from yarns, if those fabrics are classifiable under heading 5602 or 5603 of the HTSUS);

(ii) From components knit-to-shape in the United States and one or more beneficiary countries from yarns whol- ly formed in the United States; or

(iii) From any combination of two or more of the cutting or knitting-to- shape operations described in para- graph (a)(11)(i) or paragraph (a)(11)(ii) of this section.

(b) Special rules for certain component materials—(1) General. An article other- wise described under paragraph (a) of this section will not be ineligible for the preferential treatment referred to in § 10.211 because the article contains:

(i) Findings and trimmings of foreign origin, if the value of those findings and trimmings does not exceed 25 per- cent of the cost of the components of the assembled article. For purposes of this section ‘‘findings and trimmings’’ include, but are not limited to, hooks and eyes, snaps, buttons, ‘‘bow buds,’’ decorative lace trim, elastic strips (but only if they are each less than 1 inch in width and are used in the production of brassieres), zippers (including zipper tapes), labels, and sewing thread except in the case of an article described in paragraph (a)(3) of this section;

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00194 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

185

U.S. Customs and Border Protection, DHS; Treasury § 10.213

(ii) Interlinings of foreign origin, if the value of those interlinings does not exceed 25 percent of the cost of the components of the assembled article. For purposes of this section ‘‘inter- linings’’ include only a chest type plate, a ‘‘hymo’’ piece, or ‘‘sleeve head- er,’’ of woven or weft-inserted warp knit construction and of coarse animal hair or man-made filaments;

(iii) Any combination of findings and trimmings of foreign origin and inter- linings of foreign origin, if the total value of those findings and trimmings and interlinings does not exceed 25 per- cent of the cost of the components of the assembled article; or

(iv) Fibers or yarns not wholly formed in the United States or one or more beneficiary countries if the total weight of all those fibers and yarns is not more than 7 percent of the total weight of the article.

(2) ‘‘Cost’’and ‘‘value’’ defined. The ‘‘cost’’ of components and the ‘‘value’’ of findings and trimmings or inter- linings referred to in paragraph (b)(1) of this section means:

(i) The price of the components, find- ings and trimmings, or interlinings when last purchased, f.o.b. port of ex- portation, as set out in the invoice or other commercial documents, or, if the price is other than f.o.b. port of expor- tation:

(A) The price as set out in the invoice or other commercial documents ad- justed to arrive at an f.o.b. port of ex- portation price; or

(B) If no exportation to a beneficiary country is involved, the price as set out in the invoice or other commercial documents, less the freight, insurance, packing and other costs incurred in transporting the components, findings and trimmings, or interlinings to the place of production if included in that price; or

(ii) If the price cannot be determined under paragraph (b)(2)(i) of this section or if Customs finds that price to be un- reasonable, all reasonable expenses in- curred in the growth, production, man- ufacture, or other processing of the components, findings and trimmings, or interlinings, including the cost or value of materials and general ex- penses, plus a reasonable amount for profit, and the freight, insurance, pack-

ing, and other costs, if any, incurred in transporting the components, findings and trimmings, or interlinings to the port of exportation.

(3) Treatment of fibers and yarns as findings or trimmings. If any fibers or yarns not wholly formed in the United States or one or more beneficiary coun- tries are used in an article as a finding or trimming described in paragraph (b)(1)(i) of this section, the fibers or yarns will be considered to be a finding or trimming for purposes of paragraph (b)(1) of this section.

(c) Imported directly defined. For pur- poses of paragraph (a) of this section, the words ‘‘imported directly’’ mean:

(1) Direct shipment from any bene- ficiary country to the United States without passing through the territory of any non-beneficiary country;

(2) If the shipment is from any bene- ficiary country to the United States through the territory of any non-bene- ficiary country, the articles in the shipment do not enter into the com- merce of any non-beneficiary country while en route to the United States and the invoices, bills of lading, and other shipping documents show the United States as the final destination; or

(3) If the shipment is from any bene- ficiary country to the United States through the territory of any non-bene- ficiary country, and the invoices and other documents do not show the United States as the final destination, the articles in the shipment upon ar- rival in the United States are imported directly only if they:

(i) Remained under the control of the customs authority of the intermediate country;

(ii) Did not enter into the commerce of the intermediate country except for the purpose of sale other than at retail, and the port director is satisfied that the importation results from the origi- nal commercial transaction between the importer and the producer or the producer’s sales agent; and

(iii) Were not subjected to operations other than loading or unloading, and other activities necessary to preserve the articles in good condition.

[T.D. 00–67, 65 FR 59676, Oct. 5, 2000; 65 FR 67260, Nov. 9, 2000, as amended by T.D. 03–15, 68 FR 13824, Mar. 21, 2003]

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00195 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

186

19 CFR Ch. I (4–1–12 Edition)§ 10.214

§ 10.214 Certificate of Origin.

(a) General. A Certificate of Origin must be employed to certify that a tex- tile or apparel article being exported from a beneficiary country to the United States qualifies for the pref- erential treatment referred to in § 10.211. The Certificate of Origin must be prepared by the exporter in the ben- eficiary country in the form specified in paragraph (b) of this section. Where the beneficiary country exporter is not the producer of the article, that ex-

porter may complete and sign a Certifi- cate of Origin on the basis of:

(1) Its reasonable reliance on the pro- ducer’s written representation that the article qualifies for preferential treat- ment; or

(2) A completed and signed Certifi- cate of Origin for the article volun- tarily provided to the exporter by the producer.

(b) Form of Certificate. The Certificate of Origin referred to in paragraph (a) of this section must be in the following format:

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00196 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

187

U.S. Customs and Border Protection, DHS; Treasury § 10.214

(c) Preparation of Certificate. The fol- lowing rules will apply for purposes of completing the Certificate of Origin set forth in paragraph (b) of this section:

(1) Blocks 1 through 5 pertain only to the final article exported to the United

States for which preferential treat- ment may be claimed;

(2) Block 1 should state the legal name and address (including country) of the exporter;

(3) Block 2 should state the legal name and address (including country)

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00197 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150 ER 21

M R

03 .0

01 <

/G P

H >

188

19 CFR Ch. I (4–1–12 Edition)§ 10.215

of the producer. If there is more than one producer, attach a list stating the legal name and address (including country) of all additional producers. If this information is confidential, it is acceptable to state ‘‘available to Cus- toms upon request’’ in block 2. If the producer and the exporter are the same, state ‘‘same’’ in block 2;

(4) Block 3 should state the legal name and address (including country) of the importer;

(5) In block 4, insert the number and/ or letter that identifies the preference group which applies to the article ac- cording to the description contained in the CFR provision cited on the Certifi- cate for that group;

(6) Block 5 should provide a full de- scription of each article. The descrip- tion should be sufficient to relate it to the invoice description and to the de- scription of the article in the inter- national Harmonized System. Include the invoice number as shown on the commercial invoice or, if the invoice number is not known, include another unique reference number such as the shipping order number;

(7) Blocks 6 through 10 must be com- pleted only when the block in question calls for information that is relevant to the preference group identified in block 4;

(8) Block 6 should state the legal name and address (including country) of the fabric producer;

(9) Block 7 should state the legal name and address (including country) of the yarn producer;

(10) Block 8 should state the legal name and address (including country) of the thread producer;

(11) Block 9 should state the name of the folklore article or should state that the article is handloomed or handmade;

(12) Block 10 should be completed only when the preference group identi- fier ‘‘8’’ and/or ‘‘H’’ is inserted in block 4 and should state the name of the fab- ric or yarn that is in short supply in the NAFTA or that has been designated as not available in commercial quan- tities in the United States;

(13) Block 11 must contain the signa- ture of the exporter or of the exporter’s authorized agent having knowledge of the relevant facts;

(14) Block 15 should reflect the date on which the Certificate was completed and signed;

(15) Block 16 should be completed if the Certificate is intended to cover multiple shipments of identical arti- cles as described in block 5 that are im- ported into the United States during a specified period of up to one year (see § 10.216(b)(4)(ii)). The ‘‘from’’ date is the date on which the Certificate became applicable to the article covered by the blanket Certificate (this date may be prior to the date reflected in block 15). The ‘‘to’’ date is the date on which the blanket period expires;

(16) The telephone and facsimile numbers included in block 17 should be those at which the person who signed the Certificate may be contacted; and

(17) The Certificate may be printed and reproduced locally. If more space is needed to complete the Certificate, at- tach a continuation sheet.

[T.D. 00–67, 65 FR 59676, Oct. 5, 2000, as amended by T.D. 03–15, 68 FR 13825, Mar. 21, 2003]

§ 10.215 Filing of claim for preferential treatment.

(a) Declaration. In connection with a claim for preferential treatment for a textile or apparel article described in § 10.213, the importer must make a written declaration that the article qualifies for that treatment. The inclu- sion on the entry summary, or equiva- lent documentation, of the subheading within Chapter 98 of the HTSUS under which the article is classified will con- stitute the written declaration. Except in any of the circumstances described in § 10.216(d)(1), the declaration re- quired under this paragraph must be based on an original Certificate of Ori- gin that has been completed and prop- erly executed in accordance with § 10.214, that covers the article being imported, and that is in the possession of the importer.

(b) Corrected declaration. If, after making the declaration required under paragraph (a) of this section, the im- porter has reason to believe that a Cer- tificate of Origin on which a declara- tion was based contains information that is not correct, the importer must within 30 calendar days after the date

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00198 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

189

U.S. Customs and Border Protection, DHS; Treasury § 10.216

of discovery of the error make a cor- rected declaration and pay any duties that may be due. A corrected declara- tion will be effected by submission of a letter or other written statement to the Customs port where the declara- tion was originally filed.

[T.D. 00–67, 65 FR 59676, Oct. 5, 2000, as amended by T.D. 03–15, 68 FR 13827, Mar. 21, 2003]

§ 10.216 Maintenance of records and submission of Certificate by im- porter.

(a) Maintenance of records. Each im- porter claiming preferential treatment for an article under § 10.215 must main- tain in the United States, in accord- ance with the provisions of part 163 of this chapter, all records relating to the importation of the article. Those records must include the original Cer- tificate of Origin referred to in § 10.215(a) and any other relevant docu- ments or other records as specified in § 163.1(a) of this chapter.

(b) Submission of Certificate. An im- porter who claims preferential treat- ment on a textile or apparel article under § 10.215(a) must provide, at the request of the port director, a copy of the Certificate of Origin pertaining to the article. A Certificate of Origin sub- mitted to Customs under this para- graph:

(1) Must be in writing or must be transmitted electronically pursuant to any electronic data interchange system authorized by Customs for that pur- pose;

(2) Must be signed by the exporter or by the exporter’s authorized agent hav- ing knowledge of the relevant facts;

(3) Must be completed either in the English language or in the language of the country from which the article is exported. If the Certificate is com- pleted in a language other than English, the importer must provide to Customs upon request a written English translation of the Certificate; and

(4) May be applicable to: (i) A single importation of an article

into the United States, including a sin- gle shipment that results in the filing of one or more entries and a series of shipments that results in the filing of one entry; or

(ii) Multiple importations of iden- tical articles into the United States that occur within a specified blanket period, not to exceed 12 months, set out in the Certificate by the exporter. For purposes of this paragraph and § 10.214(c)(15), ‘‘identical articles’’ means articles that are the same in all material respects, including physical characteristics, quality, and reputa- tion.

(c) Correction and nonacceptance of Certificate. If the port director deter- mines that a Certificate of Origin is il- legible or defective or has not been completed in accordance with para- graph (b) of this section, the importer will be given a period of not less than five working days to submit a cor- rected Certificate. A Certificate will not be accepted in connection with sub- sequent importations during a period referred to in paragraph (b)(4)(ii) of this section if the port director deter- mined that a previously imported iden- tical article covered by the Certificate did not qualify for preferential treat- ment.

(d) Certificate not required—(1) Gen- eral. Except as otherwise provided in paragraph (d)(2) of this section, an im- porter is not required to have a Certifi- cate of Origin in his possession for:

(i) An importation of an article for which the port director has in writing waived the requirement for a Certifi- cate of Origin because the port director is otherwise satisfied that the article qualifies for preferential treatment;

(ii) A non-commercial importation of an article; or

(iii) A commercial importation of an article whose value does not exceed US$2,500, provided that, unless waived by the port director, the producer, ex- porter, importer or authorized agent includes on, or attaches to, the invoice or other document accompanying the shipment the following signed state- ment:

I hereby certify that the article covered by this shipment qualifies for preferential treatment under the AGOA.

Check One: ( ) Producer ( ) Exporter ( ) Importer ( ) Agent

llllllllllllllllllllllll

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00199 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

190

19 CFR Ch. I (4–1–12 Edition)§ 10.217

Name llllllllllllllllllllllll

Title llllllllllllllllllllllll

Address llllllllllllllllllllllll

Signature and Date

(2) Exception. If the port director de- termines that an importation described in paragraph (d)(1) of this section forms part of a series of importations that may reasonably be considered to have been undertaken or arranged for the purpose of avoiding a Certificate of Or- igin requirement under §§ 10.214 through 10.216, the port director will notify the importer in writing that for that importation the importer must have in his possession a valid Certifi- cate of Origin to support the claim for preferential treatment. The importer will have 30 calendar days from the date of the written notice to obtain a valid Certificate of Origin, and a fail- ure to timely obtain the Certificate of Origin will result in denial of the claim for preferential treatment. For pur- poses of this paragraph, a ‘‘series of im- portations’’ means two or more entries covering articles arriving on the same day from the same exporter and con- signed to the same person.

[T.D. 00–67, 65 FR 59676, Oct. 5, 2000, as amended by T.D. 03–15, 68 FR 13827, Mar. 21, 2003]

§ 10.217 Verification and justification of claim for preferential treatment.

(a) Verification by Customs. A claim for preferential treatment made under § 10.215, including any statements or other information contained on a Cer- tificate of Origin submitted to Customs under § 10.216, will be subject to what- ever verification the port director deems necessary. In the event that the port director for any reason is pre- vented from verifying the claim, the port director may deny the claim for preferential treatment. A verification of a claim for preferential treatment may involve, but need not be limited to, a review of:

(1) All records required to be made, kept, and made available to Customs by the importer or any other person under part 163 of this chapter;

(2) Documentation and other infor- mation regarding the country of origin

of an article and its constituent mate- rials, including, but not limited to, production records, information relat- ing to the place of production, the number and identification of the types of machinery used in production, and the number of workers employed in production; and

(3) Evidence to document the use of U.S. materials in the production of the article in question, such as purchase orders, invoices, bills of lading and other shipping documents, and customs import and clearance documents.

(b) Importer requirements. In order to make a claim for preferential treat- ment under § 10.215, the importer:

(1) Must have records that explain how the importer came to the conclu- sion that the textile or apparel article qualifies for preferential treatment. Those records must include documents that support a claim that the article in question qualifies for preferential treatment because it is specifically de- scribed in one of the provisions under § 10.213(a). If the importer is claiming that the article incorporates fabric or yarn that originated or was wholly formed in the United States, the im- porter must have records that identify the U.S. producer of the fabric or yarn. A properly completed Certificate of Or- igin in the form set forth in § 10.214(b) is a record that would serve these pur- poses;

(2) Must establish and implement in- ternal controls which provide for the periodic review of the accuracy of the Certificate of Origin or other records referred to in paragraph (b)(1) of this section;

(3) Must have shipping papers that show how the article moved from the beneficiary country to the United States. If the imported article was shipped through a country other than a beneficiary country and the invoices and other documents from the bene- ficiary country do not show the United States as the final destination, the im- porter also must have documentation that demonstrates that the conditions set forth in § 10.213(c)(3) (i) through (iii) were met; and

(4) Must be prepared to explain, upon request from Customs, how the records and internal controls referred to in paragraphs (b)(1) through (b)(3) of this

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00200 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

191

U.S. Customs and Border Protection, DHS; Treasury § 10.222

section justify the importer’s claim for preferential treatment.

[T.D. 00–67, 65 FR 59676, Oct. 5, 2000, as amended by T.D. 03–15, 68 FR 13827, Mar. 21, 2003]

Subpart E—United States-Carib- bean Basin Trade Partnership Act

TEXTILE AND APPAREL ARTICLES UNDER THE UNITED STATES-CARIBBEAN BASIN TRADE PARTNERSHIP ACT

SOURCE: T.D. 00–68, 65 FR 59658, Oct. 5, 2000, unless otherwise noted.

§ 10.221 Applicability. Title II of Public Law 106–200 (114

Stat. 251), entitled the United States- Caribbean Basin Trade Partnership Act (CBTPA), amended section 213(b) of the Caribbean Basin Economic Recovery Act (the CBERA, 19 U.S.C. 2701–2707) to authorize the President to extend addi- tional trade benefits to countries that have been designated as beneficiary countries under the CBERA. Section 213(b)(2) of the CBERA (19 U.S.C. 2703(b)(2)) provides for the preferential treatment of certain textile and ap- parel articles from CBERA beneficiary countries. The provisions of §§ 10.221– 10.227 of this part set forth the legal re- quirements and procedures that apply for purposes of obtaining preferential treatment pursuant to CBERA section 213(b)(2).

[T.D. 00–68, 65 FR 59658, Oct. 5, 2000; 65 FR 67262, Nov. 9, 2000]

§ 10.222 Definitions. When used in §§ 10.221 through 10.228,

the following terms have the meanings indicated:

Apparel articles. ‘‘Apparel articles’’ means goods classifiable in Chapters 61 and 62 and headings 6501, 6502, 6503, and 6504 and subheadings 6406.99 and 6505.90 of the HTSUS.

Assembled in one or more CBTPA bene- ficiary countries. ‘‘Assembled in one or more CBTPA beneficiary countries’’ when used in the context of a textile or apparel article has reference to a join- ing together of two or more compo- nents that occurred in one or more CBTPA beneficiary countries, whether

or not a prior joining operation was performed on the article or any of its components in the United States.

CBERA. ‘‘CBERA’’ means the Carib- bean Basin Economic Recovery Act, 19 U.S.C. 2701–2707.

CBTPA beneficiary country. ‘‘CBTPA beneficiary country’’ means a ‘‘bene- ficiary country’’ as defined in § 10.191(b)(1) for purposes of the CBERA which the President also has des- ignated as a beneficiary country for purposes of preferential treatment of textile and apparel articles under 19 U.S.C. 2703(b)(2) and which has been the subject of a finding by the President or his designee, published in the FEDERAL REGISTER, that the beneficiary country has satisfied the requirements of 19 U.S.C. 2703(b)(4)(A)(ii).

Cut in one or more CBTPA beneficiary countries. ‘‘Cut in one or more CBTPA beneficiary countries’’ when used with reference to apparel articles means that all fabric components used in the assembly of the article were cut from fabric in one or more CBTPA bene- ficiary countries.

Foreign. ‘‘Foreign’’ means of a coun- try other than the United States or a CBTPA beneficiary country.

HTSUS. ‘‘HTSUS’’ means the Har- monized Tariff Schedule of the United States.

Knit-to-shape. The term ‘‘knit-to- shape’’ applies to any apparel article of which 50 percent or more of the exte- rior surface area is formed by major parts that have been knitted or cro- cheted directly to the shape used in the apparel article, with no consideration being given to patch pockets, appli- ques, or the like. Minor cutting, trim- ming, or sewing of those major parts will not affect the determination of whether an apparel article is ‘‘knit-to- shape.’’

Luggage. ‘‘Luggage’’ means travel goods (such as trunks, hand trunks, lockers, valises, satchels, suitcases, wardrobe cases, overnight bags, pull- man bags, gladstone bags, traveling bags, knapsacks, kitbags, haversacks, duffle bags, and like articles designed to contain clothing or other personal effects during travel) and brief cases, portfolios, school bags, photographic equipment bags, golf bags, camera

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00201 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

192

19 CFR Ch. I (4–1–12 Edition)§ 10.223

cases, binocular cases, gun cases, occu- pational luggage cases (for example, physicians’ cases, sample cases), and like containers and cases designed to be carried with the person. The term ‘‘luggage’’ does not include handbags (that is, pocketbooks, purses, shoulder bags, clutch bags, and all similar arti- cles, by whatever name known, cus- tomarily carried by women or girls). The term ‘‘luggage’’ also does not in- clude flat goods (that is, small flatware designed to be carried on the person, such as banknote cases, bill cases, bill- folds, bill purses, bill rolls, card cases, change cases, cigarette cases, coin purses, coin holders, compacts, cur- rency cases, key cases, letter cases, li- cense cases, money cases, pass cases, passport cases, powder cases, spectacle cases, stamp cases, vanity cases, to- bacco pouches, and similar articles).

Made in one or more CBTPA bene- ficiary countries. ‘‘Made in one or more CBTPA beneficiary countries’’ when used with reference to non-underwear t-shirts means cut in one or more CBTPA beneficiary countries and whol- ly assembled in one or more CBTPA beneficiary countries.

Major parts. ‘‘Major parts’’ means in- tegral components of an apparel article but does not include collars, cuffs, waistbands, plackets, pockets, linings, paddings, trim, accessories, or similar parts or components.

NAFTA. ‘‘NAFTA’’ means the North American Free Trade Agreement en- tered into by the United States, Can- ada, and Mexico on December 17, 1992.

Preferential treatment. ‘‘Preferential treatment’’ means entry, or with- drawal from warehouse for consump- tion, in the customs territory of the United States free of duty and free of any quantitative restrictions, limita- tions, or consultation levels as pro- vided in 19 U.S.C. 2703(b)(2).

Wholly assembled in one or more CBTPA beneficiary countries. ‘‘Wholly assembled in one or more CBTPA bene- ficiary countries’’ when used in the context of a textile or apparel article has reference to a joining together of all components (including thread, deco- rative embellishments, buttons, zip- pers, or similar components) that oc- curred only in one or more CBTPA ben- eficiary countries.

Wholly formed. ‘‘Wholly formed,’’ when used with reference to yarns, means that all of the production proc- esses, starting with the extrusion of filament, strip, film, or sheet and in- cluding slitting a film or sheet into strip or the spinning of all fibers into yarn or both and ending with a yarn or plied yarn, took place in a single coun- try, and, when used with reference to fabric(s), means that all of the produc- tion processes, starting with polymers, fibers, filaments, textile strips, yarns, twine, cordage, rope, or strips of fabric and ending with a fabric by a weaving, knitting, needling, tufting, felting, en- tangling or other process, took place in a single country.

[T.D. 00–68, 65 FR 59658, Oct. 5, 2000; 65 FR 67262, Nov. 9, 2000; T.D. 01–74, 66 FR 50537, Oct. 4, 2001, as amended by T.D. 03–12, 68 FR 13831, Mar. 21, 2003]

§ 10.223 Articles eligible for pref- erential treatment.

(a) General. The preferential treat- ment referred to in § 10.221 applies to the following textile and apparel arti- cles that are imported directly into the customs territory of the United States from a CBTPA beneficiary country:

(1) Apparel articles sewn or otherwise assembled in one or more CBTPA bene- ficiary countries from fabrics wholly formed and cut, or from components knit-to-shape, in the United States, from yarns wholly formed in the United States (including fabrics not formed from yarns, if those fabrics are classifiable under heading 5602 or 5603 of the HTSUS and are wholly formed and cut in the United States) that are entered under subheading 9802.00.80 of the HTSUS, and provided that any other processing involving the article conforms to the rules set forth in para- graph (b) of this section;

(2) Apparel articles sewn or otherwise assembled in one or more CBTPA bene- ficiary countries from fabrics wholly formed and cut, or from components knit-to-shape, in the United States, from yarns wholly formed in the United States (including fabrics not formed from yarns, if those fabrics are classifiable under heading 5602 or 5603 of the HTSUS and are wholly formed and cut in the United States) that are entered under Chapter 61 or 62 of the

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00202 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

193

U.S. Customs and Border Protection, DHS; Treasury § 10.223

HTSUS, if, after that assembly, the ar- ticles would have qualified for entry under subheading 9802.00.80 of the HTSUS but for the fact that the arti- cles were embroidered or subjected to stone-washing, enzyme-washing, acid washing, perma-pressing, oven-baking, bleaching, garment-dyeing, screen printing, or other similar processes in a CBTPA beneficiary country, and pro- vided that any other processing involv- ing the article conforms to the rules set forth in paragraph (b) of this sec- tion;

(3) Apparel articles sewn or otherwise assembled in one or more CBTPA bene- ficiary countries with thread formed in the United States from fabrics wholly formed in the United States and cut in one or more CBTPA beneficiary coun- tries from yarns wholly formed in the United States, or from components knit-to-shape in the United States from yarns wholly formed in the United States, or both (including fab- rics not formed from yarns, if those fabrics are classifiable under heading 5602 or 5603 of the HTSUS and are whol- ly formed in the United States), and provided that any other processing in- volving the article conforms to the rules set forth in paragraph (b) of this section;

(4) Apparel articles (other than socks provided for in heading 6115 of the HTSUS) knit to shape in a CBTPA ben- eficiary country from yarns wholly formed in the United States, and knit- ted or crocheted apparel articles (other than non-underwear t-shirts classifi- able under subheadings 6109.10.00 and 6109.90.10 of the HTSUS and described in paragraph (a)(5) of this section) cut and wholly assembled in one or more CBTPA beneficiary countries from fab- rics formed in one or more CBTPA ben- eficiary countries or in one or more CBTPA beneficiary countries and the United States from yarns wholly formed in the United States (including fabrics not formed from yarns, if those fabrics are classifiable under heading 5602 or 5603 of the HTSUS and are formed in one or more CBTPA bene- ficiary countries);

(5) Non-underwear t-shirts, classifi- able under subheadings 6109.10.00 and 6109.90.10 of the HTSUS, made in one or more CBTPA beneficiary countries

from fabric formed in one or more CBTPA beneficiary countries from yarns wholly formed in the United States;

(6) Brassieres classifiable under sub- heading 6212.10 of the HTSUS, if both cut and sewn or otherwise assembled in the United States, or in one or more CBTPA beneficiary countries, or in both, other than articles entered as ar- ticles described in paragraphs (a)(1) through (a)(5), paragraphs (a)(7) through (a)(9), or paragraph (a)(12), and provided that any applicable additional requirements set forth in § 10.228 are met;

(7) Apparel articles, other than arti- cles described in paragraph (a)(6) of this section, that are both cut (or knit- to-shape) and sewn or otherwise assem- bled in one or more CBTPA beneficiary countries, from fabrics or yarn that is not formed in the United States or in one or more CBTPA beneficiary coun- tries, to the extent that apparel arti- cles of those fabrics or yarn would be eligible for preferential treatment, without regard to the source of the fab- rics or yarn, under Annex 401 of the NAFTA;

(8) Apparel articles that are both cut (or knit-to-shape) and sewn or other- wise assembled in one or more CBTPA beneficiary countries from fabrics or yarn that the President or his designee has designated in the FEDERAL REG- ISTER as not available in commercial quantities in the United States;

(9) A handloomed, handmade, or folk- lore textile or apparel article of a CBTPA beneficiary country that the President or his designee and rep- resentatives of the CBTPA beneficiary country mutually agree is a handloomed, handmade, or folklore ar- ticle and that is certified as a handloomed, handmade, or folklore ar- ticle by the competent authority of the CBTPA beneficiary country;

(10) Textile luggage assembled in a CBTPA beneficiary country from fabric wholly formed and cut in the United States, from yarns wholly formed in the United States, that is entered under subheading 9802.00.80 of the HTSUS;

(11) Textile luggage assembled in a CBTPA beneficiary country from fabric cut in a CBTPA beneficiary country

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00203 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

194

19 CFR Ch. I (4–1–12 Edition)§ 10.223

from fabric wholly formed in the United States from yarns wholly formed in the United States;

(12) Knitted or crocheted apparel ar- ticles cut and assembled in one or more CBTPA beneficiary countries from fab- rics wholly formed in the United States from yarns wholly formed in the United States, or from components knit-to-shape in the United States from yarns wholly formed in the United States, or both (including fab- rics not formed from yarns, if those fabrics are classifiable under heading 5602 or 5603 of the HTSUS and are formed wholly in the United States), provided that the assembly is with thread formed in the United States, and provided that any other processing involving the article conforms to the rules set forth in paragraph (b) of this section; and

(13) Apparel articles sewn or other- wise assembled in one or more CBTPA beneficiary countries with thread formed in the United States:

(i) From components cut in the United States and in one or more CBTPA beneficiary countries from fab- ric wholly formed in the United States from yarns wholly formed in the United States (including fabrics not formed from yarns, if those fabrics are classifiable under heading 5602 or 5603 of the HTSUS);

(ii) From components knit-to-shape in the United States and one or more CBTPA beneficiary countries from yarns wholly formed in the United States; or

(iii) From any combination of two or more of the cutting or knitting-to- shape operations described in para- graph (a)(13)(i) or paragraph (a)(13)(ii) of this section; and

(iv) Provided that any processing not described in this paragraph (a)(13) con- forms to the rules set forth in para- graph (b) of this section.

(b) Dyeing, printing, finishing and other operations—(1) Dyeing, printing and finishing operations. Dyeing, print- ing, and finishing operations may be performed on any yarn, fabric, or knit- to-shape or other component used in the production of any article described under paragraph (a) of this section without affecting the eligibility of the article for preferential treatment, pro-

vided that the operation is performed in the United States or in a CBTPA beneficiary country and not in any other country and subject to the fol- lowing additional conditions:

(i) In the case of an article described in paragraph (a)(1), (a)(2), (a)(3), (a)(12), or (a)(13) of this section that is entered on or after September 1, 2002, and that contains a knitted or crocheted or woven fabric, or a knitted or crocheted or woven fabric component produced from fabric, that was wholly formed in the United States from yarns wholly formed in the United States, any dye- ing, printing, or finishing of that knit- ted or crocheted or woven fabric or component must have been carried out in the United States; and

(ii) In the case of assembled luggage described in paragraph (a)(10) of this section, an operation may be performed in a CBTPA beneficiary country only if that operation is incidental to the as- sembly process within the meaning of § 10.16.

(2) Other operations. An article de- scribed under paragraph (a) of this sec- tion that is otherwise eligible for pref- erential treatment will not be disquali- fied from receiving that treatment by virtue of having undergone one or more operations such as embroidering, stone-washing, enzyme-washing, acid washing, perma-pressing, oven-baking, bleaching, garment-dyeing or screen printing, provided that the operation is performed in the United States or in a CBTPA beneficiary country and not in any other country. However, in the case of assembled luggage described in paragraph (a)(10) of this section, an op- eration may be performed in a CBTPA beneficiary country without affecting the eligibility of the article for pref- erential treatment only if it is inci- dental to the assembly process within the meaning of § 10.16.

(c) Special rules for certain component materials—(1) Foreign findings, trim- mings, interlinings, fibers and yarns—(i) General. An article otherwise described under paragraph (a) of this section will not be ineligible for the preferential treatment referred to in § 10.221 because the article contains:

(A) Findings and trimmings of for- eign origin, if the value of those find- ings and trimmings does not exceed 25

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00204 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

195

U.S. Customs and Border Protection, DHS; Treasury § 10.223

percent of the cost of the components of the assembled article. For purposes of this section ‘‘findings and trim- mings’’ include, but are not limited to, hooks and eyes, snaps, buttons, ‘‘bow buds,’’ decorative lace trim, elastic strips (but only if they are each less than 1 inch in width and are used in the production of brassieres), zippers (in- cluding zipper tapes), labels, and sew- ing thread except in the case of an arti- cle described in paragraph (a)(3) or (a)(12) of this section;

(B) Interlinings of foreign origin, if the value of those interlinings does not exceed 25 percent of the cost of the components of the assembled article. For purposes of this section ‘‘inter- linings’’ include only a chest type plate, a ‘‘hymo’’ piece, or ‘‘sleeve head- er,’’ of woven or weft-inserted warp knit construction and of coarse animal hair or man-made filaments;

(C) Any combination of findings and trimmings of foreign origin and inter- linings of foreign origin, if the total value of those findings and trimmings and interlinings does not exceed 25 per- cent of the cost of the components of the assembled article; or

(D) Fibers or yarns not wholly formed in the United States or in one or more CBTPA beneficiary countries if the total weight of all those fibers and yarns is not more than 7 percent of the total weight of the article, except in the case of any apparel article de- scribed in paragraph (a)(1) through (a)(5) or (a)(12) of this section con- taining elastomeric yarns which will be eligible for preferential treatment only if those yarns are wholly formed in the United States.

(ii) ‘‘Cost’’ and ‘‘value’’ defined. The ‘‘cost’’ of components and the ‘‘value’’ of findings and trimmings or inter- linings referred to in paragraph (c)(1)(i) of this section means:

(A) The price of the components, findings and trimmings, or interlinings when last purchased, f.o.b. port of ex- portation, as set out in the invoice or other commercial documents, or, if the price is other than f.o.b. port of expor- tation:

(1) The price as set out in the invoice or other commercial documents ad- justed to arrive at an f.o.b. port of ex- portation price; or

(2) If no exportation to a CBTPA ben- eficiary country is involved, the price as set out in the invoice or other com- mercial documents, less the freight, in- surance, packing, and other costs in- curred in transporting the components, findings and trimmings, or interlinings to the place of production if included in that price; or

(B) If the price cannot be determined under paragraph (c)(1)(ii)(A) of this sec- tion or if Customs finds that price to be unreasonable, all reasonable ex- penses incurred in the growth, produc- tion, manufacture, or other processing of the components, findings and trim- mings, or interlinings, including the cost or value of materials and general expenses, plus a reasonable amount for profit, and the freight, insurance, pack- ing, and other costs, if any, incurred in transporting the components, findings and trimmings, or interlinings to the port of exportation.

(iii) Treatment of fibers and yarns as findings or trimmings. If any fibers or yarns not wholly formed in the United States or one or more beneficiary coun- tries are used in an article as a finding or trimming described in paragraph (c)(1)(i)(A) of this section, the fibers or yarns will be considered to be a finding or trimming for purposes of paragraph (c)(1)(i) of this section.

(2) Special rule for nylon filament yarn. An article otherwise described under paragraph (a)(1), (a)(2), (a)(3) or (a)(12) of this section will not be ineligible for the preferential treatment referred to in § 10.221 because the article contains nylon filament yarn (other than elas- tomeric yarn) that is classifiable under subheading 5402.10.30, 5402.10.60, 5402.31.30, 5402.31.60, 5402.32.30, 5402.32.60, 5402.41.10, 5402.41.90, 5402.51.00, or 5402.61.00 of the HTSUS duty-free from Canada, Mexico or Israel.

(3) Dyed, printed, or finished thread. An article otherwise described under paragraph (a) of this section will not be ineligible for the preferential treat- ment referred to in § 10.221 because the thread used to assemble the article is dyed, printed, or finished in one or more CBTPA beneficiary countries.

(d) Imported directly defined. For pur- poses of paragraph (a) of this section, the words ‘‘imported directly’’ mean:

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00205 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

196

19 CFR Ch. I (4–1–12 Edition)§ 10.224

(1) Direct shipment from any CBTPA beneficiary country to the United States without passing through the territory of any country that is not a CBTPA beneficiary country;

(2) If the shipment is from any CBTPA beneficiary country to the United States through the territory of any country that is not a CBTPA bene- ficiary country, the articles in the shipment do not enter into the com- merce of any country that is not a CBTPA beneficiary country while en route to the United States and the in- voices, bills of lading, and other ship- ping documents show the United States as the final destination; or

(3) If the shipment is from any CBTPA beneficiary country to the United States through the territory of any country that is not a CBTPA bene- ficiary country, and the invoices and other documents do not show the United States as the final destination, the articles in the shipment upon ar- rival in the United States are imported directly only if they:

(i) Remained under the control of the customs authority of the intermediate country;

(ii) Did not enter into the commerce of the intermediate country except for the purpose of sale other than at retail, and the port director is satisfied that the importation results from the origi- nal commercial transaction between the importer and the producer or the producer’s sales agent; and

(iii) Were not subjected to operations other than loading or unloading, and other activities necessary to preserve the articles in good condition.

[T.D. 00–68, 65 FR 59658, Oct. 5, 2000; 65 FR 67262, Nov. 9, 2000, as amended by T.D. 01–74, 66 FR 50537, Oct. 4, 2001; T.D. 03–12, 68 FR 13832, Mar. 21, 2003]

§ 10.224 Certificate of Origin.

(a) General. A Certificate of Origin must be employed to certify that a tex- tile or apparel article being exported from a CBTPA beneficiary country to the United States qualifies for the pref- erential treatment referred to in § 10.221. The Certificate of Origin must be prepared by the exporter in the CBTPA beneficiary country in the form specified in paragraph (b) of this sec- tion. Where the CBTPA beneficiary country exporter is not the producer of the article, that exporter may com- plete and sign a Certificate of Origin on the basis of:

(1) Its reasonable reliance on the pro- ducer’s written representation that the article qualifies for preferential treat- ment; or

(2) A completed and signed Certifi- cate of Origin for the article volun- tarily provided to the exporter by the producer.

(b) Form of Certificate. The Certificate of Origin referred to in paragraph (a) of this section must be in the following format:

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00206 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

197

U.S. Customs and Border Protection, DHS; Treasury § 10.224

(c) Preparation of Certificate. The fol- lowing rules will apply for purposes of completing the Certificate of Origin set forth in paragraph (b) of this section:

(1) Blocks 1 through 5 pertain only to the final article exported to the United

States for which preferential treat- ment may be claimed;

(2) Block 1 should state the legal name and address (including country) of the exporter;

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00207 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150 ER 21

M R

03 .0

02 <

/G P

H >

198

19 CFR Ch. I (4–1–12 Edition)§ 10.225

(3) Block 2 should state the legal name and address (including country) of the producer. If there is more than one producer, attach a list stating the legal name and address (including country) of all additional producers. If this information is confidential, it is acceptable to state ‘‘available to Cus- toms upon request’’ in block 2. If the producer and the exporter are the same, state ‘‘same’’ in block 2;

(4) Block 3 should state the legal name and address (including country) of the importer;

(5) In block 4, insert the letter that designates the preference group which applies to the article according to the description contained in the CFR pro- vision cited on the Certificate for that group;

(6) Block 5 should provide a full de- scription of each article. The descrip- tion should be sufficient to relate it to the invoice description and to the de- scription of the article in the inter- national Harmonized System. Include the invoice number as shown on the commercial invoice or, if the invoice number is not known, include another unique reference number such as the shipping order number;

(7) Blocks 6 through 10 must be com- pleted only when the block in question calls for information that is relevant to the preference group identified in block 4;

(8) Block 6 should state the legal name and address (including country) of the fabric producer;

(9) Block 7 should state the legal name and address (including country) of the yarn producer;

(10) Block 8 should state the legal name and address (including country) of the thread producer;

(11) Block 9 should state the name of the folklore article or should state that the article is handloomed or handmade of handloomed fabric;

(12) Block 10 should be completed if the article described in block 5 incor- porates a fabric or yarn described in preference group G and should state the name of the fabric or yarn that has been considered as being in short sup- ply in the NAFTA or that has been des- ignated as not available in commercial quantities in the United States;

(13) Block 11 must contain the signa- ture of the exporter or of the exporter’s authorized agent having knowledge of the relevant facts;

(14) Block 15 should reflect the date on which the Certificate was completed and signed;

(15) Block 16 should be completed if the Certificate is intended to cover multiple shipments of identical arti- cles as described in block 5 that are im- ported into the United States during a specified period of up to one year (see § 10.226(b)(4)(ii)). The ‘‘from’’ date is the date on which the Certificate became applicable to the article covered by the blanket Certificate (this date may be prior to the date reflected in block 15). The ‘‘to’’ date is the date on which the blanket period expires; and

(16) The Certificate may be printed and reproduced locally. If more space is needed to complete the Certificate, at- tach a continuation sheet.

[T.D. 00–68, 65 FR 59658, Oct. 5, 2000; 65 FR 67263, Nov. 9, 2000, as amended by T.D. 03–12, 68 FR 13833, Mar. 21, 2003]

§ 10.225 Filing of claim for preferential treatment.

(a) Declaration. In connection with a claim for preferential treatment for a textile or apparel article described in § 10.223, the importer must make a written declaration that the article qualifies for that treatment. The inclu- sion on the entry summary, or equiva- lent documentation, of the subheading within Chapter 98 of the HTSUS under which the article is classified will con- stitute the written declaration. Except in any of the circumstances described in § 10.226(d)(1), the declaration re- quired under this paragraph must be based on a Certificate of Origin that has been completed and properly exe- cuted in accordance with § 10.224 and that covers the article being imported.

(b) Corrected declaration. If, after making the declaration required under paragraph (a) of this section, the im- porter has reason to believe that a Cer- tificate of Origin on which a declara- tion was based contains information that is not correct, the importer must within 30 calendar days after the date of discovery of the error make a cor- rected declaration and pay any duties

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00208 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

199

U.S. Customs and Border Protection, DHS; Treasury § 10.226

that may be due. A corrected declara- tion will be effected by submission of a letter or other written statement to the Customs port where the declara- tion was originally filed.

[T.D. 00–68, 65 FR 59658, Oct. 5, 2000; 65 FR 67263, Nov. 9, 2000, as amended by T.D. 03–12, 68 FR 13835, Mar. 21, 2003]

§ 10.226 Maintenance of records and submission of Certificate by im- porter.

(a) Maintenance of records. Each im- porter claiming preferential treatment for an article under § 10.225 must main- tain in the United States, in accord- ance with the provisions of part 163 of this chapter, all records relating to the importation of the article. Those records must include the original Cer- tificate of Origin referred to in § 10.225(a) and any other relevant docu- ments or other records as specified in § 163.1(a) of this chapter.

(b) Submission of Certificate. An im- porter who claims preferential treat- ment on a textile or apparel article under § 10.225(a) must provide, at the request of the port director, a copy of the Certificate of Origin pertaining to the article. A Certificate of Origin sub- mitted to Customs under this para- graph:

(1) Must be in writing or must be transmitted electronically pursuant to any electronic data interchange system authorized by Customs for that pur- pose;

(2) Must be signed by the exporter or by the exporter’s authorized agent hav- ing knowledge of the relevant facts;

(3) Must be completed either in the English language or in the language of the country from which the article is exported. If the Certificate is com- pleted in a language other than English, the importer must provide to Customs upon request a written English translation of the Certificate; and

(4) May be applicable to: (i) A single importation of an article

into the United States, including a sin- gle shipment that results in the filing of one or more entries and a series of shipments that results in the filing of one entry; or

(ii) Multiple importations of iden- tical articles into the United States

that occur within a specified blanket period, not to exceed 12 months, set out in the Certificate by the exporter. For purposes of this paragraph and § 10.224(c)(15), ‘‘identical articles’’ means articles that are the same in all material respects, including physical characteristics, quality, and reputa- tion.

(c) Correction and nonacceptance of Certificate. If the port director deter- mines that a Certificate of Origin is il- legible or defective or has not been completed in accordance with para- graph (b) of this section, the importer will be given a period of not less than five working days to submit a cor- rected Certificate. A Certificate will not be accepted in connection with sub- sequent importations during a period referred to in paragraph (b)(4)(ii) of this section if the port director deter- mined that a previously imported iden- tical article covered by the Certificate did not qualify for preferential treat- ment.

(d) Certificate not required—(1) Gen- eral. Except as otherwise provided in paragraph (d)(2) of this section, an im- porter is not required to have a Certifi- cate of Origin in his possession for:

(i) An importation of an article for which the port director has in writing waived the requirement for a Certifi- cate of Origin because the port director is otherwise satisfied that the article qualifies for preferential treatment;

(ii) A non-commercial importation of an article; or

(iii) A commercial importation of an article whose value does not exceed US $2,500, provided that, unless waived by the port director, the producer, ex- porter, importer or authorized agent includes on, or attaches to, the invoice or other document accompanying the shipment the following signed state- ment:

I hereby certify that the article covered by this shipment qualifies for preferential treatment under the CBTPA.

Check One:

( ) Producer ( ) Exporter ( ) Importer ( ) Agent

llllllllllllllllllllllll

Name

llllllllllllllllllllllll

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00209 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

200

19 CFR Ch. I (4–1–12 Edition)§ 10.227

Title llllllllllllllllllllllll

Address llllllllllllllllllllllll

Signature and Date

(2) Exception. If the port director de- termines that an importation described in paragraph (d)(1) of this section forms part of a series of importations that may reasonably be considered to have been undertaken or arranged for the purpose of avoiding a Certificate of Or- igin requirement under §§ 10.224 through 10.226, the port director will notify the importer in writing that for that importation the importer must have in his possession a valid Certifi- cate of Origin to support the claim for preferential treatment. The importer will have 30 calendar days from the date of the written notice to obtain a valid Certificate of Origin, and a fail- ure to timely obtain the Certificate of Origin will result in denial of the claim for preferential treatment. For pur- poses of this paragraph, a ‘‘series of im- portations’’ means two or more entries covering articles arriving on the same day from the same exporter and con- signed to the same person.

[T.D. 00–68, 65 FR 59658, Oct. 5, 2000, as amended by T.D. 03–12, 68 FR 13835, Mar. 21, 2003]

§ 10.227 Verification and justification of claim for preferential treatment.

(a) Verification by Customs. A claim for preferential treatment made under § 10.225, including any statements or other information contained on a Cer- tificate of Origin submitted to Customs under § 10.226, will be subject to what- ever verification the port director deems necessary. In the event that the port director for any reason is pre- vented from verifying the claim, the port director may deny the claim for preferential treatment. A verification of a claim for preferential treatment may involve, but need not be limited to, a review of:

(1) All records required to be made, kept, and made available to Customs by the importer or any other person under part 163 of this chapter;

(2) Documentation and other infor- mation regarding the country of origin of an article and its constituent mate- rials, including, but not limited to,

production records, information relat- ing to the place of production, the number and identification of the types of machinery used in production, and the number of workers employed in production; and

(3) Evidence to document the use of U.S. materials in the production of the article in question, such as purchase orders, invoices, bills of lading and other shipping documents, and customs import and clearance documents.

(b) Importer requirements. In order to make a claim for preferential treat- ment under § 10.225, the importer:

(1) Must have records that explain how the importer came to the conclu- sion that the textile or apparel article qualifies for preferential treatment. Those records must include documents that support a claim that the article in question qualifies for preferential treatment because it is specifically de- scribed in one of the provisions under § 10.223(a). If the importer is claiming that the article incorporates fabric or yarn that was wholly formed in the United States, the importer must have records that identify the U.S. producer of the fabric or yarn. A properly com- pleted Certificate of Origin in the form set forth in § 10.224(b) is a record that would serve these purposes;

(2) Must establish and implement in- ternal controls which provide for the periodic review of the accuracy of the Certificates of Origin or other records referred to in paragraph (b)(1) of this section;

(3) Must have shipping papers that show how the article moved from the CBTPA beneficiary country to the United States. If the imported article was shipped through a country other than a CBTPA beneficiary country and the invoices and other documents from the CBTPA beneficiary country do not show the United States as the final destination, the importer also must have documentation that demonstrates that the conditions set forth in § 10.223(d)(3)(i) through (iii) were met; and

(4) Must be prepared to explain, upon request from Customs, how the records and internal controls referred to in paragraphs (b)(1) through (b)(3) of this

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00210 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

201

U.S. Customs and Border Protection, DHS; Treasury § 10.228

section justify the importer’s claim for preferential treatment.

[T.D. 00–68, 65 FR 59658, Oct. 5, 2000, as amended by T.D. 03–12, 68 FR 13835, Mar. 21, 2003]

§ 10.228 Additional requirements for preferential treatment of bras- sieres.

(a) Definitions. When used in this sec- tion, the following terms have the meanings indicated:

(1) Producer. ‘‘Producer’’ means an in- dividual, corporation, partnership, as- sociation, or other entity or group that exercises direct, daily operational con- trol over the production process in a CBTPA beneficiary country.

(2) Entity controlling production. ‘‘En- tity controlling production’’ means an individual, corporation, partnership, association, or other entity or group that is not a producer and that con- trols the production process in a CBTPA beneficiary country through a contractual relationship or other indi- rect means.

(3) Fabrics formed in the United States. ‘‘Fabrics formed in the United States’’ means fabrics that were produced by a weaving, knitting, needling, tufting, felting, entangling or other fabric- making process performed in the United States.

(4) Cost. ‘‘Cost’’ when used with ref- erence to fabrics formed in the United States means:

(i) The price of the fabrics when last purchased, f.o.b. port of exportation, as set out in the invoice or other commer- cial documents, or, if the price is other than f.o.b. port of exportation:

(A) The price as set out in the invoice or other commercial documents ad- justed to arrive at an f.o.b. port of ex- portation price; or

(B) If no exportation to a CBTPA beneficiary country is involved, the price as set out in the invoice or other commercial documents, less the freight, insurance, packing, and other costs incurred in transporting the fab- rics to the place of production if in- cluded in that price; or

(ii) If the price cannot be determined under paragraph (a)(4)(i) of this section or if CBP finds that price to be unrea- sonable, all reasonable expenses in- curred in the growth, production, man-

ufacture, or other processing of the fabrics, including the cost or value of materials (which includes the cost of non-recoverable scrap generated in forming the fabrics) and general ex- penses, plus a reasonable amount for profit, and the freight, insurance, pack- ing, and other costs, if any, incurred in transporting the fabrics to the port of exportation.

(5) Declared customs value. ‘‘Declared customs value’’ when used with ref- erence to fabric contained in an article means the sum of:

(i) The cost of fabrics formed in the United States that the producer or en- tity controlling production can verify; and

(ii) The cost of all other fabric con- tained in the article, exclusive of all findings and trimmings, determined as follows:

(A) In the case of fabric purchased by the producer or entity controlling pro- duction, the f.o.b. port of exportation price of the fabric as set out in the in- voice or other commercial documents, or, if the price is other than f.o.b. port of exportation:

(1) The price as set out in the invoice or other commercial documents ad- justed to arrive at an f.o.b. port of ex- portation price, plus expenses for em- broidering and dyeing, printing, and finishing operations applied to the fab- ric if not included in that price; or

(2) If no exportation to a CBTPA ben- eficiary country is involved, the price as set out in the invoice or other com- mercial documents, plus expenses for embroidering and dyeing, printing, and finishing operations applied to the fab- ric if not included in that price, but less the freight, insurance, packing, and other costs incurred in trans- porting the fabric to the place of pro- duction if included in that price;

(B) In the case of fabric for which the cost cannot be determined under para- graph (a)(5)(ii)(A) of this section or if CBP finds that cost to be unreasonable, all reasonable expenses incurred in the growth, production, or manufacture of the fabric, including the cost or value of materials (which includes the cost of non-recoverable scrap generated in the growth, production, or manufacture of the fabric), general expenses and em- broidering and dyeing, printing, and

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00211 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

202

19 CFR Ch. I (4–1–12 Edition)§ 10.228

finishing expenses, plus a reasonable amount for profit, and the freight, in- surance, packing, and other costs, if any, incurred in transporting the fabric to the port of exportation;

(C) In the case of fabric components purchased by the producer or entity controlling production, the f.o.b. port of exportation price of those fabric components as set out in the invoice or other commercial documents, less the cost or value of any non-textile mate- rials, and less expenses for cutting or other processing to create the fabric components other than knitting to shape, that the producer or entity con- trolling production can verify, or, if the price is other than f.o.b. port of ex- portation:

(1) The price as set out in the invoice or other commercial documents ad- justed to arrive at an f.o.b. port of ex- portation price, less the cost or value of any non-textile materials, and less expenses for cutting or other proc- essing to create the fabric components other than knitting to shape, that the producer or entity controlling produc- tion can verify; or

(2) If no exportation to a CBTPA ben- eficiary country is involved, the price as set out in the invoice or other com- mercial documents, less the cost or value of any non-textile materials, and less expenses for cutting or other proc- essing to create the fabric components other than knitting to shape, that the producer or entity controlling produc- tion can verify, and less the freight, in- surance, packing, and other costs in- curred in transporting the fabric com- ponents to the place of production if included in that price; and

(D) In the case of fabric components for which a fabric cost cannot be deter- mined under paragraph (a)(5)(ii)(C) of this section or if CBP finds that cost to be unreasonable: all reasonable ex- penses incurred in the growth, produc- tion, or manufacture of the fabric com- ponents, including the cost or value of materials (which does not include the cost of recoverable scrap generated in the growth, production, or manufac- ture of the fabric components) and gen- eral expenses, but excluding the cost or value of any non-textile materials, and excluding expenses for cutting or other processing to create the fabric compo-

nents other than knitting to shape, that the producer or entity controlling production can verify, plus a reason- able amount for profit, and the freight, insurance, packing, and other costs, if any, incurred in transporting the fabric components to the port of exportation.

(6) Year. ‘‘Year’’ means a 12-month period beginning on October 1 and end- ing on September 30 but does not in- clude any 12-month period that began prior to October 1, 2000.

(7) Entered. ‘‘Entered’’ means entered, or withdrawn from warehouse for con- sumption, in the customs territory of the United States.

(b) Limitations on preferential treat- ment—(1) General. During the year that begins on October 1, 2002, and during any subsequent year, articles of a pro- ducer or an entity controlling produc- tion that conform to the production standards set forth in § 10.223(a)(6) will be eligible for preferential treatment only if:

(i) The aggregate cost of fabrics (ex- clusive of all findings and trimmings) formed in the United States that were used in the production of all of those articles of that producer or that entity controlling production that are entered as articles described in § 10.223(a)(6) during the immediately preceding year was at least 75 percent of the aggregate declared customs value of the fabric (exclusive of all findings and trim- mings) contained in all of those arti- cles of that producer or that entity controlling production that are entered as articles described in § 10.223(a)(6) during that year; or

(ii) In a case in which the 75 percent requirement set forth in paragraph (b)(1)(i) of this section was not met during a year and therefore those arti- cles of that producer or that entity controlling production were not eligi- ble for preferential treatment during the following year, the aggregate cost of fabrics (exclusive of all findings and trimmings) formed in the United States that were used in the produc- tion of all of those articles of that pro- ducer or that entity controlling pro- duction that conform to the production standards set forth in § 10.223(a)(6) and that were entered during the imme- diately preceding year was at least 85

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00212 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

203

U.S. Customs and Border Protection, DHS; Treasury § 10.228

percent of the aggregate declared cus- toms value of the fabric (exclusive of all findings and trimmings) contained in all of those articles of that producer or that entity controlling production that conform to the production stand- ards set forth in § 10.223(a)(6) and that were entered during that year; and

(iii) In conjunction with the filing of the claim for preferential treatment under § 10.225, the importer records on the entry summary or warehouse with- drawal for consumption (CBP Form 7501, column 34), or its electronic equivalent, the distinct and unique identifier assigned by CBP to the appli- cable documentation prescribed under paragraph (c) of this section.

(2) Rules of application—(i) General. For purposes of paragraphs (b)(1)(i) and (b)(1)(ii) of this section and for pur- poses of preparing and filing the docu- mentation prescribed in paragraph (c) of this section, the following rules will apply:

(A) The articles in question must have been produced in the manner specified in § 10.223(a)(6) and the arti- cles in question must be entered within the same year;

(B) Articles that are exported to countries other than the United States and are never entered are not to be considered in determining compliance with the 75 or 85 percent standard spec- ified in paragraph (b)(1)(i) or paragraph (b)(1)(ii) of this section;

(C) Articles that are entered under an HTSUS subheading other than the HTSUS subheading which pertains to articles described in § 10.223(a)(6) are not to be considered in determining compliance with the 75 percent stand- ard specified in paragraph (b)(1)(i) of this section;

(D) For purposes of determining com- pliance with the 85 percent standard specified in paragraph (b)(1)(ii) of this section, all articles that conform to the production standards set forth in § 10.223(a)(6) must be considered, re- gardless of the HTSUS subheading under which they were entered;

(E) Fabric components and fabrics that constitute findings or trimmings are not to be considered in determining compliance with the 75 or 85 percent standard specified in paragraph (b)(1)(i) or paragraph (b)(1)(ii) of this section;

(F) Beginning October 1, 2002, in order for articles to be eligible for pref- erential treatment in a given year, a producer of, or entity controlling pro- duction of, those articles must have met the 75 percent standard specified in paragraph (b)(1)(i) of this section during the immediately preceding year. If articles of a producer or entity controlling production fail to meet the 75 percent standard specified in para- graph (b)(1)(i) of this section during a year, articles of that producer or enti- ty controlling production:

(1) Will not be eligible for pref- erential treatment during the fol- lowing year;

(2) Will remain ineligible for pref- erential treatment until the year that follows a year in which articles of that producer or entity controlling produc- tion met the 85 percent standard speci- fied in paragraph (b)(1)(ii) of this sec- tion; and

(3) After the 85 percent standard specified in paragraph (b)(1)(ii) of this section has been met, will again be sub- ject to the 75 percent standard speci- fied in paragraph (b)(1)(i) of this sec- tion during the following year for pur- poses of determining eligibility for preferential treatment in the next year.

(G) A new producer or new entity controlling production, that is, a pro- ducer or entity controlling production which did not produce or control pro- duction of articles that were entered as articles described in § 10.223(a)(6) during the immediately preceding year, must first establish compliance with the 85 percent standard specified in paragraph (b)(1)(ii) of this section as a pre- requisite to preparation of the declara- tion of compliance referred to in para- graph (c) of this section;

(H) A declaration of compliance pre- pared by a producer or by an entity controlling production must cover all production of that producer or all pro- duction that the entity controls for the year in question;

(I) A producer is not required to pre- pare a declaration of compliance if all of its production is covered by a dec- laration of compliance prepared by an entity controlling production;

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00213 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

204

19 CFR Ch. I (4–1–12 Edition)§ 10.228

(J) In the case of a producer, the 75 or 85 percent standard specified in para- graph (b)(1)(i) or paragraph (b)(1)(ii) of this section and the declaration of compliance procedure under paragraph (c) of this section apply to all articles of that producer for the year in ques- tion, even if some but not all of that production is also covered by a declara- tion of compliance prepared by an enti- ty controlling production;

(K) The U.S. importer does not have to be the producer or the entity con- trolling production who prepared the declaration of compliance; and

(L) The exclusion references regard- ing findings and trimmings in para- graph (b)(1)(i) and paragraph (b)(1)(ii) of this section apply to all findings and trimmings, whether or not they are of foreign origin.

(ii) Examples. The following examples will illustrate application of the prin- ciples set forth in paragraph (b)(2)(i) of this section.

Example 1. A CBTPA beneficiary country producer of articles that meet the produc- tion standards specified in § 10.223(a)(6) in the first year sends 50 percent of that production to CBTPA region markets and the other 50 percent to the U.S. market; the cost of the fabrics formed in the United States equals 100 percent of the value of all of the fabric in the articles sent to the CBTPA region and 60 percent of the value of all of the fabric in the articles sent to the United States. Although the cost of fabrics formed in the United States is more than 75 percent of the value of all of the fabric used in all of the articles produced, this producer could not prepare a valid declaration of compliance because the articles sent to the United States did not meet the minimum 75 percent standard.

Example 2. A producer sends to the United States in the first year three shipments of articles that meet the description in § 10.223(a)(6); one of those shipments is en- tered under the HTSUS subheading that cov- ers articles described in § 10.223(a)(6), the sec- ond shipment is entered under the HTSUS subheading that covers articles described in § 10.223(a)(12), and the third shipment is en- tered under subheading 9802.00.80, HTSUS. In determining whether the minimum 75 per- cent standard has been met in the first year for purposes of entry of articles under the HTSUS subheading that covers articles de- scribed in § 10.223(a)(6) during the following (that is, second) year, consideration must be restricted to the articles in the first ship- ment and therefore must not include the ar- ticles in the second and third shipments.

Example 3. A producer in the second year begins production of articles that conform to the production standards specified in § 10.223(a)(6); some of those articles are en- tered in that year under HTSUS subheading 6212.10 and others under HTSUS subheading 9802.00.80 but none are entered in that year under the HTSUS subheading which pertains to articles described in § 10.223(a)(6) because the 75 percent standard had not been met in the preceding (that is, first) year. In this case the 85 percent standard applies, and all of the articles that were entered under the various HTSUS provisions in the second year must be taken into account in determining whether that 85 percent standard has been met. If the 85 percent was met in the aggre- gate for all of the articles entered in the sec- ond year, in the next (that is, third) year ar- ticles of that producer may receive pref- erential treatment under the HTSUS sub- heading which pertains to articles described in § 10.223(a)(6).

Example 4. An entity controlling produc- tion of articles that meet the description in § 10.223(a)(6) buys for the U.S., Canadian and Mexican markets; the articles in each case are first sent to the United States where they are entered for consumption and then placed in a commercial warehouse from which they are shipped to various stores in the United States, Canada and Mexico. Not- withstanding the fact that some of the arti- cles ultimately ended up in Canada or Mex- ico, a declaration of compliance prepared by the entity controlling production must cover all of the articles rather than only those that remained in the United States because all of those articles had been entered for con- sumption.

Example 5. Fabric is cut and sewn in the United States with other U.S. materials to form cups which are joined together to form brassiere front subassemblies in the United States, and those front subassemblies are then placed in a warehouse in the United States where they are held until the fol- lowing year; during that following year all of the front subassemblies are shipped to a CBTPA beneficiary country where they are assembled with elastic strips and labels pro- duced in an Asian country and other fabrics, components or materials produced in the CBTPA beneficiary country to form articles that meet the production standards specified in § 10.223(a)(6) and that are then shipped to the United States and entered during that same year. In determining whether the en- tered articles meet the minimum 75 or 85 percent standard, the fabric in the elastic strips and labels is to be disregarded entirely because the strips and labels constitute find- ings or trimmings for purposes of this sec- tion, and all of the fabric in the front sub- assemblies is countable because it was all formed in the United States and used in the

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00214 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

205

U.S. Customs and Border Protection, DHS; Treasury § 10.228

production of articles that were entered in the same year.

Example 6. A CBTPA beneficiary country producer’s entire production of articles that meet the description in § 10.223(a)(6) is sent to a U.S. importer in two separate ship- ments, one in February and the other in June of the same calendar year; the articles shipped in February do not meet the min- imum 75 percent standard, the articles shipped in June exceed the 85 percent stand- ard, and the articles in the two shipments, taken together, do meet the 75 percent standard; the articles covered by the Feb- ruary shipment are entered for consumption on March 1 of that calendar year, and the ar- ticles covered by the June shipment are placed in a CBP bonded warehouse upon ar- rival and are subsequently withdrawn from warehouse for consumption on November 1 of that calendar year. The CBTPA beneficiary country producer may not prepare a valid declaration of compliance covering the arti- cles in the first shipment because those arti- cles did not meet the minimum 75 percent standard and because those articles cannot be included with the articles of the second shipment on the same declaration of compli- ance since they were entered in a different year. However, the CBTPA beneficiary coun- try producer may prepare a valid declaration of compliance covering the articles in the second shipment because those articles did meet the requisite 85 percent standard which would apply for purposes of entry of articles in the following year.

Example 7. A producer in the second year begins production of articles exclusively for the U.S. market that meet the production standards specified in § 10.223(a)(6), but the entered articles do not meet the requisite 85 percent standard until the third year; the en- tered articles fail to meet the 75 percent standard in the fourth year; and the entered articles do not attain the 85 percent standard until the sixth year. The producer’s articles may not receive preferential treatment dur- ing the second year because there was no production (and thus there were no entered articles) in the immediately preceding (that is, first) year on which to assess compliance with the 75 percent standard. The producer’s articles also may not receive preferential treatment during the third year because the 85 percent standard was not met in the im- mediately preceding (that is, second) year. However, the producer’s articles are eligible for preferential treatment during the fourth year based on compliance with the 85 percent standard in the immediately preceding (that is, third) year. The producer’s articles may not receive preferential treatment during the fifth year because the 75 percent stand- ard was not met in the immediately pre- ceding (that is, fourth) year. The producer’s articles may not receive preferential treat- ment during the sixth year because the 85

percent standard has become applicable and was not met in the immediately preceding (that is, fifth) year. The producer’s articles are eligible for preferential treatment during the seventh year because the 85 percent standard was met in the immediately pre- ceding (that is, sixth) year, and during that seventh year the 75 percent standard is appli- cable for purposes of determining whether the producer’s articles are eligible for pref- erential treatment in the following (that is, eighth) year.

Example 8. An entity controlling produc- tion (Entity A) uses five CBTPA beneficiary country producers (Producers 1–5), all of which produce only articles that meet the description in § 10.223(a)(6); Producers 1–4 send all of their production to the United States and Producer 5 sends 10 percent of its production to the United States and the rest to Europe; Producers 1–3 and Producer 5 produce only pursuant to contracts with En- tity A, but Producer 4 also operates inde- pendently of Entity A by producing for sev- eral U.S. importers, one of which is an entity controlling production (Entity B) that also controls all of the production of articles of one other producer (Producer 6) which sends all of its production to the United States. A declaration of compliance prepared by Enti- ty A must cover all of the articles of Pro- ducers 1–3 and the 10 percent of articles of Producer 5 that are sent to the United States and that portion of the articles of Producer 4 that are produced pursuant to the contract with Entity A, because Entity A controls the production of those articles. There is no need for Producers 1–3 and Producer 5 to prepare a declaration of compliance because they have no production that is not covered by a declaration of compliance prepared by an en- tity controlling production. A declaration of compliance prepared by Producer 4 would cover all of its production, that is, articles produced for Entity A, articles produced for Entity B, and articles produced independ- ently for other U.S. importers; a declaration of compliance prepared by Entity B must cover that portion of the production of Pro- ducer 4 that it controls as well as all of the production of Producer 6 because Entity B also controls all of the production of Pro- ducer 6. Producer 6 would not prepare a dec- laration of compliance because all of its pro- duction is covered by the declaration of com- pliance prepared by Entity B.

(c) Documentation—(1) Initial declara- tion of compliance. In order for an im- porter to comply with the requirement set forth in paragraph (b)(1)(iii) of this section, the producer or the entity con- trolling production must have filed with CBP, in accordance with para- graph (c)(4) of this section, a declara- tion of compliance with the applicable

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00215 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

206

19 CFR Ch. I (4–1–12 Edition)§ 10.228

75 or 85 percent requirement prescribed in paragraph (b)(1)(i) or (b)(1)(ii) of this section. After filing of the declaration of compliance has been completed, CBP will advise the producer or the entity controlling production of the distinct and unique identifier assigned to that declaration. The producer or the entity controlling production will then be re- sponsible for advising each appropriate U.S. importer of that distinct and unique identifier for purposes of re- cording that identifier on the entry summary or warehouse withdrawal. In order to provide sufficient time for ad- vising the U.S. importer of that dis- tinct and unique identifier prior to the arrival of the articles in the United States, the producer or the entity con- trolling production should file the dec- laration of compliance with CBP at least 10 calendar days prior to the date of the first shipment of the articles to the United States.

(2) Amended declaration of compliance. If the information on the declaration of compliance referred to in paragraph (c)(1) of this section is based on an esti- mate because final year-end informa- tion was not available at that time and the final data differs from the esti-

mate, or if the producer or the entity controlling production has reason to believe for any other reason that the declaration of compliance that was filed contained erroneous information, within 30 calendar days after the final year-end information becomes avail- able or within 30 calendar days after the date of discovery of the error:

(i) The producer or the entity con- trolling production must file with the CBP office identified in paragraph (c)(4) of this section an amended dec- laration of compliance containing that final year-end information or other corrected information; or

(ii) If that final year-end information or other corrected information dem- onstrates noncompliance with the ap- plicable 75 or 85 percent requirement, the producer or the entity controlling production must in writing advise both the CBP office identified in paragraph (c)(4) of this section and each appro- priate U.S. importer of that fact.

(3) Form and preparation of declaration of compliance—(i) Form. The declaration of compliance referred to in paragraph (c)(1) of this section may be printed and reproduced locally and must be in the following format:

CARIBBEAN BASIN TRADE PARTNERSHIP ACT DECLARATION OF COMPLIANCE FOR BRASSIERES [19 CFR 10.223(a)(6) and 10.228]

1. Year beginning date: October 1, llll Official U.S. Customs and Border Year ending date: September 30, llll Protection Use Only

Assigned number: lllll Assignment date: lllll

2. Identity of preparer (producer or entity controlling production): Full name and address: Telephone number: lllll

Facsimile number: lllll Importer identification number: lllll

3. If the preparer is an entity controlling production, provide the following for each producer: Full name and address: Telephone number: lllll

Facsimile number: lllll 4. Aggregate cost of fabrics (exclusive of all findings and trimmings) formed in the United States that were used in the produc-

tion of brassieres that were entered during the year: lllll 5. Aggregate declared customs value of the fabric (exclusive of all findings and trimmings) contained in brassieres that were en-

tered during the year: lllll 6. I declare that the aggregate cost of fabric (exclusive of all findings and trimmings) formed in the United States was at least

75 percent (or 85 percent, if applicable under 19 CFR 10.228(b)(1)(ii)) of the aggregate declared customs value of the fabric contained in brassieres entered during the year.

7. Authorized signature: 8. Name and title (print or type): lllllllll

Date:

(ii) Preparation. The following rules will apply for purposes of completing the declaration of compliance set forth in paragraph (c)(3)(i) of this section:

(A) In block 1, fill in the year com- mencing October 1 and ending Sep-

tember 30 of the calendar year during which the applicable 75 or 85 percent standard specified in paragraph (b)(1)(i) or paragraph (b)(1)(ii) of this section was met;

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00216 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

207

U.S. Customs and Border Protection, DHS; Treasury § 10.228

(B) Block 2 should state the legal name and address (including country) of the preparer and should also include the preparer’s importer identification number (see § 24.5 of this chapter), if the preparer has one;

(C) Block 3 should state the legal name and address (including country) of the CBTPA beneficiary country pro- ducer if that producer is not already identified in block 2. If there is more than one producer, attach a list stating the legal name and address (including country) of all additional producers;

(D) Blocks 4 and 5 apply only to arti- cles that were entered during the year identified in block 1; and

(E) In block 7, the signature must be that of an authorized officer, employee, agent or other person having knowl- edge of the relevant facts and the date must be the date on which the declara- tion of compliance was completed and signed.

(4) Filing of declaration of compliance. The declaration of compliance referred to in paragraph (c)(1) of this section:

(i) Must be completed either in the English language or in the language of the country in which the articles cov- ered by the declaration were produced. If the declaration is completed in a language other than English, the pro- ducer or the entity controlling produc- tion must provide to CBP upon request a written English translation of the declaration; and

(ii) Must be filed with the New York Strategic Trade Center, Customs and Border Protection, 1 Penn Plaza, New York, New York 10119.

(d) Verification of declaration of compli- ance—(1) Verification procedure. A dec- laration of compliance filed under this section will be subject to whatever verification CBP deems necessary. In the event that CBP for any reason is prevented from verifying the state- ments made on a declaration of compli- ance, CBP may deny any claim for preferential treatment made under § 10.225 that is based on that declara- tion. A verification of a declaration of compliance may involve, but need not be limited to, a review of:

(i) All records required to be made, kept, and made available to CBP by the importer, the producer, the entity con-

trolling production, or any other per- son under part 163 of this chapter;

(ii) Documentation and other infor- mation regarding all articles that meet the production standards specified in § 10.223(a)(6) that were exported to the United States and that were entered during the year in question, whether or not a claim for preferential treatment was made under § 10.225. Those records and other information include, but are not limited to, work orders and other production records, purchase orders, invoices, bills of lading and other ship- ping documents;

(iii) Evidence to document the cost of fabrics formed in the United States that were used in the production of the articles in question, such as purchase orders, invoices, bills of lading and other shipping documents, and customs import and clearance documents, work orders and other production records, and inventory control records;

(iv) Evidence to document the cost or value of all fabric other than fabrics formed in the United States that were used in the production of the articles in question, such as purchase orders, invoices, bills of lading and other ship- ping documents, and customs import and clearance documents, work orders and other production records, and in- ventory control records; and

(v) Accounting books and documents to verify the records and information referred to in paragraphs (d)(1)(ii) through (d)(1)(iv) of this section. The verification of purchase orders, in- voices and bills of lading will be ac- complished through the review of a dis- tinct audit trail. The audit trail docu- ments must consist of a cash disburse- ment or purchase journal or equivalent records to establish the purchase of the fabric. The headings in each of these journals or other records must contain the date, vendor name, and amount paid for the fabric. The verification of production records and work orders will be accomplished through analysis of the inventory records of the pro- ducer or entity controlling production. The inventory records must reflect the production of the finished article which must be referenced to the original pur- chase order or lot number covering the fabric used in production. In the inven- tory production records, the inventory

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00217 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

208

19 CFR Ch. I (4–1–12 Edition)§ 10.231

should show the opening balance of the inventory plus the purchases made dur- ing the accounting period and the in- ventory closing balance.

(2) Notice of determination. If, based on a verification of a declaration of com- pliance filed under this section, CBP determines that the applicable 75 or 85 percent standard specified in paragraph (b)(1)(i) or paragraph (b)(1)(ii) of this section was not met, CBP will publish a notice of that determination in the FEDERAL REGISTER.

[CBP Dec. 04–40, 69 FR 69518, Nov. 30, 2004]

NON-TEXTILE ARTICLES UNDER THE UNITED STATES-CARIBBEAN BASIN TRADE PARTNERSHIP ACT

SOURCE: T.D. 00–68, 65 FR 59663, Oct. 5, 2000, unless otherwise noted.

§ 10.231 Applicability. Title II of Public Law 106–200 (114

Stat. 251), entitled the United States- Caribbean Basin Trade Partnership Act (CBTPA), amended section 213(b) of the Caribbean Basin Economic Recovery Act (the CBERA, 19 U.S.C. 2701–2707) to authorize the President to extend addi- tional trade benefits to countries that have been designated as beneficiary countries under the CBERA. Section 213(b)(3) of the CBERA (19 U.S.C. 2703(b)(3)) provides for special pref- erential tariff treatment of certain non-textile articles that are otherwise excluded from duty-free treatment under the CBERA. The provisions of §§ 10.231–10.237 of this part set forth the legal requirements and procedures that apply for purposes of obtaining pref- erential tariff treatment pursuant to CBERA section 213(b)(3).

[T.D. 00–68, 65 FR 59663, Oct. 5, 2000; 65 FR 67263, Nov. 9, 2000]

§ 10.232 Definitions. When used in §§ 10.231 through 10.237,

the following terms have the meanings indicated:

CBERA. ‘‘CBERA’’ means the Carib- bean Basin Economic Recovery Act, 19 U.S.C. 2701–2707.

CBTPA beneficiary country. ‘‘CBTPA beneficiary country’’ means a ‘‘bene- ficiary country’’ as defined in § 10.191(b)(1) for purposes of the CBERA which the President also has des-

ignated as a beneficiary country for purposes of preferential duty treat- ment of articles under 19 U.S.C. 2703(b)(3) and which has been the sub- ject of a finding by the President or his designee, published in the FEDERAL REGISTER, that the beneficiary country has satisfied the requirements of 19 U.S.C. 2703(b)(4)(A)(ii).

CBTPA originating good. ‘‘CBTPA originating good’’ means a good that meets the rules of origin for a good as set forth in General Note 12, HTSUS, and in the appendix to part 181 of this chapter and as applied under § 10.233(b).

HTSUS. ‘‘HTSUS’’ means the Har- monized Tariff Schedule of the United States.

NAFTA. ‘‘NAFTA’’ means the North American Free Trade Agreement en- tered into by the United States, Can- ada, and Mexico on December 17, 1992.

Preferential tariff treatment. ‘‘Pref- erential tariff treatment’’ when used with reference to an imported article means entry, or withdrawal from ware- house for consumption, in the customs territory of the United States with duty and other tariff treatment that is identical to the tariff treatment that would be accorded at that time under Annex 302.2 of the NAFTA to an im- ported article described in the same 8- digit subheading of the HTSUS that is a good of Mexico.

[T.D. 00–68, 65 FR 59663, Oct. 5, 2000; 65 FR 67264, Nov. 9, 2000]

§ 10.233 Articles eligible for pref- erential tariff treatment.

(a) General. The preferential tariff treatment referred to in § 10.231 applies to any of the following articles, pro- vided that the article in question is a CBTPA originating good, is imported directly into the customs territory of the United States from a CBTPA bene- ficiary country, and is not accorded duty-free treatment under U.S. Note 2(b), Subchapter II, Chapter 98, HTSUS (see § 10.26):

(1) Footwear not designated on Au- gust 5, 1983, as eligible articles for the purpose of the Generalized System of Preferences under Title V, Trade Act of 1974, as amended (19 U.S.C. 2461 through 2467);

(2) Tuna, prepared or preserved in any manner, in airtight containers;

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00218 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

209

U.S. Customs and Border Protection, DHS; Treasury § 10.234

(3) Petroleum, or any product derived from petroleum, provided for in head- ings 2709 and 2710 of the HTSUS;

(4) Watches and watch parts (includ- ing cases, bracelets, and straps), of whatever type including, but not lim- ited to, mechanical, quartz digital or quartz analog, if those watches or watch parts contain any material which is the product of any country with respect to which HTSUS column 2 rates of duty apply; and

(5) Articles to which reduced rates of duty apply under § 10.198a, except as otherwise provided in paragraph (c) of this section.

(b) Application of NAFTA rules of ori- gin. In determining whether an article is a CBTPA originating good for pur- poses of paragraph (a) of this section, application of the provisions of General Note 12 of the HTSUS and the appendix to part 181 of this chapter will be sub- ject to the following rules:

(1) No country other than the United States and a CBTPA beneficiary coun- try may be treated as being a party to the NAFTA;

(2) Any reference to trade between the United States and Mexico will be deemed to refer to trade between the United States and a CBTPA beneficiary country;

(3) Any reference to a party will be deemed to refer to a CBTPA bene- ficiary country or the United States; and

(4) Any reference to parties will be deemed to refer to any combination of CBTPA beneficiary countries or to the United States and one or more CBTPA beneficiary countries (or any combina- tion involving the United States and CBTPA beneficiary countries).

(c) Duty reductions for leather-related articles. If, after it is determined that an article described in paragraph (a)(5) of this section qualifies as a CBTPA originating good and is eligible for preferential tariff treatment under this section, it is determined that the arti- cle in question also would otherwise qualify for a reduced rate of duty under § 10.198a and that reduced rate of duty is lower than the rate of duty that would apply under this section, that lower rate of duty will apply to the ar- ticle for purposes of preferential tariff treatment under this section.

(d) Imported directly defined. For pur- poses of paragraph (a) of this section, the words ‘‘imported directly’’ mean:

(1) Direct shipment from any CBTPA beneficiary country to the United States without passing through the territory of any country that is not a CBTPA beneficiary country;

(2) If the shipment is from any CBTPA beneficiary country to the United States through the territory of any country that is not a CBTPA bene- ficiary country, the articles in the shipment do not enter into the com- merce of any country that is not a CBTPA beneficiary country while en route to the United States and the in- voices, bills of lading, and other ship- ping documents show the United States as the final destination; or

(3) If the shipment is from any CBTPA beneficiary country to the United States through the territory of any country that is not a CBTPA bene- ficiary country, and the invoices and other documents do not show the United States as the final destination, the articles in the shipment upon ar- rival in the United States are imported directly only if they:

(i) Remained under the control of the customs authority of the intermediate country;

(ii) Did not enter into the commerce of the intermediate country except for the purpose of sale other than at retail, and the port director is satisfied that the importation results from the origi- nal commercial transaction between the importer and the producer or the producer’s sales agent; and

(iii) Were not subjected to operations other than loading or unloading, and other activities necessary to preserve the articles in good condition.

§ 10.234 Certificate of Origin.

A Certificate of Origin as specified in § 10.236 must be employed to certify that an article described in § 10.233(a)(1) through (5) being exported from a CBTPA beneficiary country to the United States qualifies for the pref- erential tariff treatment referred to in § 10.231. The Certificate of Origin must be prepared by the exporter in the CBTPA beneficiary country. Where the CBTPA beneficiary country exporter is

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00219 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

210

19 CFR Ch. I (4–1–12 Edition)§ 10.235

not the producer of the article, that ex- porter may complete and sign a Certifi- cate of Origin on the basis of:

(a) Its reasonable reliance on the pro- ducer’s written representation that the article qualifies for preferential tariff treatment; or

(b) A completed and signed Certifi- cate of Origin for the article volun- tarily provided to the exporter by the producer.

§ 10.235 Filing of claim for preferential tariff treatment.

(a) Declaration. In connection with a claim for preferential tariff treatment for an article described in § 10.233(a)(1) through (5), the importer must make a written declaration that the article qualifies for that treatment. The writ- ten declaration should be made by in- cluding on the entry summary, or equivalent documentation, the symbol ‘‘R’’ as a prefix to the subheading of the HTSUS under which the article in question is classified. Except in any of the circumstances described in § 10.236(d)(1), the declaration required under this paragraph must be based on a complete and properly executed original Certificate of Origin that cov- ers the article being imported and that is in the possession of the importer.

(b) Corrected declaration. If, after making the declaration required under paragraph (a) of this section, the im- porter has reason to believe that a Cer- tificate of Origin on which a declara- tion was based contains information that is not correct, the importer must within 30 calendar days after the date of discovery of the error make a cor- rected declaration and pay any duties that may be due. A corrected declara- tion will be effected by submission of a letter or other written statement to the Customs port where the declara- tion was originally filed.

§ 10.236 Maintenance of records and submission of Certificate by im- porter.

(a) Maintenance of records. Each im- porter claiming preferential tariff treatment for an article under § 10.235 must maintain in the United States, in accordance with the provisions of part 163 of this chapter, all records relating to the importation of the article. Those

records must include the original Cer- tificate of Origin referred to in § 10.235(a) and any other relevant docu- ments or other records as specified in § 163.1(a) of this chapter.

(b) Submission of Certificate. An im- porter who claims preferential tariff treatment on an article under § 10.235(a) must provide, at the request of the port director, a copy of the Cer- tificate of Origin pertaining to the ar- ticle. A Certificate of Origin submitted to CBP under this paragraph:

(1) Must be on CBP Form 450, includ- ing privately-printed copies of that Form, or, as an alternative to CBP Form 450, in an approved computerized format or other medium or format as is approved by the Office of International Trade, U.S. Customs and Border Pro- tection, Washington, DC 20229. An al- ternative format must contain the same information and certification set forth on CBP Form 450;

(2) Must be signed by the exporter or by the exporter’s authorized agent hav- ing knowledge of the relevant facts;

(3) Must be completed either in the English language or in the language of the country from which the article is exported. If the Certificate is com- pleted in a language other than English, the importer must provide to Customs upon request a written English translation of the Certificate; and

(4) May be applicable to: (i) A single importation of an article

into the United States, including a sin- gle shipment that results in the filing of one or more entries and a series of shipments that results in the filing of one entry; or

(ii) Multiple importations of iden- tical articles into the United States that occur within a specified period, not to exceed 12 months, set out in the Certificate by the exporter.

(c) Correction and nonacceptance of Certificate. If the port director deter- mines that a Certificate of Origin is il- legible or defective or has not been completed in accordance with para- graph (b) of this section, the importer will be given a period of not less than five working days to submit a cor- rected Certificate. A Certificate will not be accepted in connection with sub- sequent importations during a period

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00220 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

211

U.S. Customs and Border Protection, DHS; Treasury § 10.237

referred to in paragraph (b)(4)(ii) of this section if the port director deter- mined that a previously imported iden- tical article covered by the Certificate did not qualify for preferential treat- ment.

(d) Certificate not required—(1) Gen- eral. Except as otherwise provided in paragraph (d)(2) of this section, an im- porter is not required to have a Certifi- cate of Origin in his possession for:

(i) An importation of an article for which the port director has in writing waived the requirement for a Certifi- cate of Origin because the port director is otherwise satisfied that the article qualifies for preferential tariff treat- ment;

(ii) A non-commercial importation of an article; or

(iii) A commercial importation of an article whose value does not exceed US$2,500, provided that, unless waived by the port director, the producer, ex- porter, importer or authorized agent includes on, or attaches to, the invoice or other document accompanying the shipment the following signed state- ment:

I hereby certify that the article covered by this shipment qualifies for preferential tariff treatment under the CBTPA.

Check One: ( ) Producer ( ) Exporter ( ) Importer ( ) Agent llllllllllllllllllllllll

Name llllllllllllllllllllllll

Title llllllllllllllllllllllll

Address llllllllllllllllllllllll

Signature and Date

(2) Exception. If the port director de- termines that an importation described in paragraph (d)(1) of this section forms part of a series of importations that may reasonably be considered to have been undertaken or arranged for the purpose of avoiding a Certificate of Or- igin requirement under §§ 10.234 through 10.236, the port director will notify the importer in writing that for that importation the importer must have in his possession a valid Certifi- cate of Origin to support the claim for preferential tariff treatment. The im- porter will have 30 calendar days from

the date of the written notice to obtain a valid Certificate of Origin, and a fail- ure to timely obtain the Certificate of Origin will result in denial of the claim for preferential tariff treatment. For purposes of this paragraph, a ‘‘series of importations’’ means two or more en- tries covering articles arriving on the same day from the same exporter and consigned to the same person.

§ 10.237 Verification and justification of claim for preferential tariff treat- ment.

(a) Verification by Customs. A claim for preferential tariff treatment made under § 10.235, including any statements or other information contained on a Certificate of Origin submitted to Cus- toms under § 10.236, will be subject to whatever verification the port director deems necessary. In the event that the port director for any reason is pre- vented from verifying the claim, the port director may deny the claim for preferential tariff treatment. A verification of a claim for preferential tariff treatment may involve, but need not be limited to, a review of:

(1) All records required to be made, kept, and made available to Customs by the importer or any other person under part 163 of this chapter;

(2) Documentation and other infor- mation in a CBTPA beneficiary coun- try regarding the country of origin of an article and its constituent mate- rials, including, but not limited to, production records, information relat- ing to the place of production, the number and identification of the types of machinery used in production, and the number of workers employed in production; and

(3) Evidence in a CBTPA beneficiary country to document the use of U.S. materials in the production of the arti- cle in question, such as purchase or- ders, invoices, bills of lading and other shipping documents, and customs im- port and clearance documents.

(b) Importer requirements. In order to make a claim for preferential tariff treatment under § 10.235, the importer:

(1) Must have records that explain how the importer came to the conclu- sion that the article qualifies for pref- erential tariff treatment. Those records must include documents that

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00221 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

212

19 CFR Ch. I (4–1–12 Edition)§ 10.241

support a claim that the article in question qualifies for preferential tariff treatment because it meets the appli- cable rule of origin set forth in General Note 12, HTSUS, and in the appendix to part 181 of this chapter. A properly completed Certificate of Origin in the form prescribed in § 10.236(b) is a record that would serve this purpose;

(2) Must establish and implement in- ternal controls which provide for the periodic review of the accuracy of the Certificate of Origin or other records referred to in paragraph (b)(1) of this section;

(3) Must have shipping papers that show how the article moved from the CBTPA beneficiary country to the United States. If the imported article was shipped through a country other than a CBTPA beneficiary country and the invoices and other documents from the CBTPA beneficiary country do not show the United States as the final destination, the importer also must have documentation that demonstrates that the conditions set forth in § 10.233(d)(3)(i) through (iii) were met; and

(4) Must be prepared to explain, upon request from Customs, how the records and internal controls referred to in paragraphs (b)(1) through (b)(3) of this section justify the importer’s claim for preferential tariff treatment.

Subpart F—Andean Trade Pro- motion and Drug Eradication Act

APPAREL AND OTHER TEXTILE ARTICLES UNDER THE ANDEAN TRADE PROMOTION AND DRUG ERADICATION ACT

SOURCE: Sections 10.241 through 10.248 issued by CBP Dec. 06–21, 71 FR 44574, Aug. 7, 2006, unless otherwise noted.

§ 10.241 Applicability. Title XXXI of Public Law 107–210 (116

Stat. 933), entitled the Andean Trade Promotion and Drug Eradication Act (ATPDEA), amended sections 202, 203, 204, and 208 of the Andean Trade Pref- erence Act (the ATPA, 19 U.S.C. 3201– 3206) to authorize the President to ex- tend additional trade benefits to coun- tries that are designated as beneficiary countries under the ATPA. Section

204(b)(3) of the ATPA (19 U.S.C. 3203(b)(3)) provides for the preferential treatment of certain apparel and other textile articles from those ATPA bene- ficiary countries which the President designates as ATPDEA beneficiary countries. The provisions of §§ 10.241 through 10.248 of this part set forth the legal requirements and procedures that apply for purposes of obtaining pref- erential treatment pursuant to ATPA section 204(b)(3) and Subchapter XXI, Chapter 98, HTSUS.

§ 10.242 Definitions.

When used in §§ 10.241 through 10.248, the following terms have the meanings indicated:

Apparel articles. ‘‘Apparel articles’’ means goods classifiable in Chapters 61 and 62 and headings 6501, 6502, 6503, and 6504 and subheadings 6406.99.15 and 6505.90 of the HTSUS.

Assembled or sewn or otherwise assem- bled in one or more ATPDEA beneficiary countries. ‘‘Assembled’’ and ‘‘sewn or otherwise assembled’’ when used in the context of production of an apparel or other textile article in one or more ATPDEA beneficiary countries has ref- erence to a joining together of two or more components that occurred in one or more ATPDEA beneficiary coun- tries, whether or not a prior joining op- eration was performed on the article or any of its components in the United States.

ATPA. ‘‘ATPA’’ means the Andean Trade Preference Act, 19 U.S.C. 3201– 3206.

ATPDEA beneficiary country. ‘‘ATPDEA beneficiary country’’ means a ‘‘beneficiary country’’ as defined in § 10.202(a) for purposes of the ATPA which the President also has des- ignated as a beneficiary country for purposes of preferential treatment of apparel and other textile articles under 19 U.S.C. 3203(b)(3) and which has been the subject of a determination by the President or his designee, published in the FEDERAL REGISTER, that the bene- ficiary country has satisfied the re- quirements of 19 U.S.C. 3203(b)(5)(A)(ii).

Chief value. ‘‘Chief value’’ when used with reference to llama, alpaca, and vicuña means that the value of those materials exceeds the value of any

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00222 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

213

U.S. Customs and Border Protection, DHS; Treasury § 10.242

other single textile material in the fab- ric or component under consideration, with the value in each case determined by application of the principles set forth in § 10.243(c)(1)(ii).

Cut in one or more ATPDEA beneficiary countries. ‘‘Cut’’ when used in the con- text of production of textile luggage in one or more ATPDEA beneficiary coun- tries means that all fabric components used in the assembly of the article were cut from fabric in one or more ATPDEA beneficiary countries, or were cut from fabric in the United States and used in a partial assembly oper- ation in the United States prior to cut- ting of fabric and assembly of the arti- cle in one or more ATPDEA beneficiary countries, or both.

Foreign origin. ‘‘Foreign origin’’ means, in the case of a finding or trim- ming of non-textile materials, that the finding or trimming is a product of a country other than the United States or a ATPDEA beneficiary country and, in the case of a finding, trimming, or interlining of textile materials, that the finding, trimming, or interlining does not meet all of the U.S. and ATPDEA beneficiary country produc- tion requirements for yarns, fabrics, and/or components specified under § 10.243(a) for the article in which it is incorporated.

HTSUS. ‘‘HTSUS’’means the Har- monized Tariff Schedule of the United States.

Knit-to-Shape Components. ‘‘Knit-to- shape,’’ when used with reference to textile components, means components that are knitted or crocheted from a yarn directly to a specific shape, that is, the shape or form of the component as it is used in the apparel article, con- taining at least one self-start edge. Minor cutting or trimming will not af- fect the determination of whether a component is ‘‘knit-to-shape.’’

Luggage. ‘‘Luggage’’ means travel goods (such as trunks, hand trunks, lockers, valises, satchels, suitcases, wardrobe cases, overnight bags, pull- man bags, gladstone bags, traveling bags, knapsacks, kitbags, haversacks, duffle bags, and like articles designed to contain clothing or other personal effects during travel) and brief cases, portfolios, school bags, photographic equipment bags, golf bags, camera

cases, binocular cases, gun cases, occu- pational luggage cases (for example, physicians’ cases, sample cases), and like containers and cases designed to be carried with the person. The term ‘‘luggage’’ does not include handbags (that is, pocketbooks, purses, shoulder bags, clutch bags, and all similar arti- cles, by whatever name known, cus- tomarily carried by women or girls). The term ‘‘luggage’’ also does not in- clude flat goods (that is, small flatware designed to be carried on the person, such as banknote cases, bill cases, bill- folds, bill purses, bill rolls, card cases, change cases, cigarette cases, coin purses, coin holders, compacts, cur- rency cases, key cases, letter cases, li- cense cases, money cases, pass cases, passport cases, powder cases, spectacle cases, stamp cases, vanity cases, to- bacco pouches, and similar articles).

NAFTA. ‘‘NAFTA’’ means the North American Free Trade Agreement en- tered into by the United States, Can- ada, and Mexico on December 17, 1992.

Preferential treatment. ‘‘Preferential treatment’’ means entry, or with- drawal from warehouse for consump- tion, in the customs territory of the United States free of duty and free of any quantitative restrictions, limita- tions, or consultation levels as pro- vided in 19 U.S.C. 3203(b)(3).

Self-start edge. ‘‘Self-start edge’’ when used with reference to knit-to-shape components means a finished edge which is finished as the component comes off the knitting machine. Sev- eral components with finished edges may be linked by yarn or thread as they are produced from the knitting machine.

Wholly formed fabric components. ‘‘Wholly formed,’’ when used with ref- erence to fabric components, means that all of the production processes, starting with the production of wholly formed fabric and ending with a com- ponent that is ready for incorporation into an apparel article, took place in a single country.

Wholly formed fabrics. ‘‘Wholly formed,’’ when used with reference to fabric(s), means that all of the produc- tion processes, starting with polymers, fibers, filaments, textile strips, yarns, twine, cordage, rope, or strips of fabric and ending with a fabric by a weaving,

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00223 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

214

19 CFR Ch. I (4–1–12 Edition)§ 10.243

knitting, needling, tufting, felting, en- tangling or other process, took place in a single country.

Wholly formed yarns. ‘‘Wholly formed,’’ when used with reference to yarns, means that all of the production processes, starting with the extrusion of filament, strip, film, or sheet and in- cluding drawing to fully orient a fila- ment or slitting a film or sheet into strip, or the spinning of all fibers into yarn, or both, and ending with a yarn or plied yarn, took place in the United States or in one or more ATPDEA ben- eficiary countries.

§ 10.243 Articles eligible for pref- erential treatment.

(a) General. Subject to paragraphs (b) and (c) of this section, preferential treatment applies to the following ap- parel and other textile articles that are imported directly into the customs ter- ritory of the United States from an ATPDEA beneficiary country:

(1) Apparel articles sewn or otherwise assembled in one or more ATPDEA beneficiary countries, or in the United States, or in both, exclusively from any one of the following:

(i) Fabrics or fabric components wholly formed, or components knit-to- shape, in the United States, from yarns wholly formed in the United States or in one or more ATPDEA beneficiary countries (including fabrics not formed from yarns, if those fabrics are classifi- able under heading 5602 or 5603 of the HTSUS and are formed in the United States), provided that, if the apparel article is assembled from knitted or crocheted or woven wholly formed fab- rics or from knitted or crocheted or woven wholly formed fabric compo- nents produced from fabric, all dyeing, printing, and finishing of that knitted or crocheted or woven fabric or compo- nent was carried out in the United States;

(ii) Fabrics or fabric components formed, or components knit-to-shape, in one or more ATPDEA beneficiary countries from yarns wholly formed in one or more ATPDEA beneficiary coun- tries, if those fabrics (including fabrics not formed from yarns, if those fabrics are classifiable under heading 5602 or 5603 of the HTSUS and are formed in one or more ATPDEA beneficiary coun-

tries) or components are in chief value of llama, alpaca, and/or vicuña;

(iii) Fabrics or yarns, provided that apparel articles (except articles classi- fiable under subheading 6212.10 of the HTSUS) of those fabrics or yarns would be considered an originating good under General Note 12(t), HTSUS, if the apparel articles had been imported directly from Canada or Mexico; or

(iv) Fabrics or yarns that the Presi- dent or his designee has designated in the FEDERAL REGISTER as fabrics or yarns that cannot be supplied by the domestic industry in commercial quan- tities in a timely manner;

(2) Apparel articles sewn or otherwise assembled in one or more ATPDEA beneficiary countries, or in the United States, or in both, exclusively from a combination of fabrics, fabric compo- nents, knit-to-shape components or yarns described in two or more of para- graphs (a)(1)(i) through (a)(1)(iv) of this section;

(3) A handloomed, handmade, or folk- lore apparel or other textile article of an ATPDEA beneficiary country that the President or his designee and rep- resentatives of the ATPDEA bene- ficiary country mutually agree is a handloomed, handmade, or folklore ar- ticle and that is certified as a handloomed, handmade, or folklore ar- ticle by the competent authority of the ATPDEA beneficiary country;

(4) Brassieres classifiable under sub- heading 6212.10 of the HTSUS, if both cut and sewn or otherwise assembled in the United States, or in one or more ATPDEA beneficiary countries, or in both, other than articles entered as ar- ticles described in paragraphs (a)(1) through (a)(3) and (a)(7) of this section, and provided that any applicable addi- tional requirements set forth in § 10.248 are met;

(5) Textile luggage assembled in an ATPDEA beneficiary country from fab- ric wholly formed and cut in the United States, from yarns wholly formed in the United States, that is en- tered under subheading 9802.00.80 of the HTSUS;

(6) Textile luggage assembled in one or more ATPDEA beneficiary countries from fabric cut in one or more ATPDEA beneficiary countries from fabric wholly formed in the United

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00224 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

215

U.S. Customs and Border Protection, DHS; Treasury § 10.243

States from yarns wholly formed in the United States; and

(7) Apparel articles sewn or otherwise assembled in one or more ATPDEA beneficiary countries from fabrics or from fabric components formed, or from components knit-to-shape, in one or more ATPDEA beneficiary countries from yarns wholly formed in the United States or in one or more ATPDEA beneficiary countries (includ- ing fabrics not formed from yarns, if those fabrics are classifiable under heading 5602 or 5603 of the HTSUS and are formed in one or more ATPDEA beneficiary countries), including ap- parel articles sewn or otherwise assem- bled in part but not exclusively from any of the fabrics, fabric components formed, or components knit-to-shape described in paragraph (a)(1) of this section.

(b) Dyeing, printing, finishing and other operations—(1) Dyeing, printing and finishing operations. Dyeing, print- ing, and finishing operations may be performed on any yarn, fabric, or knit- to-shape or other component used in the production of any article described under paragraph (a) of this section without affecting the eligibility of the article for preferential treatment, pro- vided that the operation is performed in the United States or in an ATPDEA beneficiary country and not in any other country and subject to the fol- lowing additional conditions:

(i) In the case of an article described in paragraph (a)(1), (a)(2), or (a)(7) of this section that contains a knitted or crocheted or woven fabric, or a knitted or crocheted or woven fabric compo- nent produced from fabric, that was wholly formed in the United States from yarns wholly formed in the United States or in one or more ATPDEA beneficiary countries, as de- scribed in paragraph (a)(1)(i) of this section, any dyeing, printing, or fin- ishing of that knitted or crocheted or woven fabric or component must have been carried out in the United States; and

(ii) In the case of assembled luggage described in paragraph (a)(5) of this section, an operation may be performed in an ATPDEA beneficiary country only if that operation is incidental to

the assembly process within the mean- ing of § 10.16.

(2) Other operations. An article de- scribed under paragraph (a) of this sec- tion that is otherwise eligible for pref- erential treatment will not be disquali- fied from receiving that treatment by virtue of having undergone one or more operations such as embroidering, stone-washing, enzyme-washing, acid washing, perma-pressing, oven-baking, bleaching, garment-dyeing or screen printing, provided that the operation is performed in the United States or in an ATPDEA beneficiary country and not in any other country. However, in the case of assembled luggage described in paragraph (a)(5) of this section, an op- eration may be performed in an ATPDEA beneficiary country without affecting the eligibility of the article for preferential treatment only if it is incidental to the assembly process within the meaning of § 10.16.

(c) Special rules for certain component materials—(1) Foreign findings, trim- mings, interlinings, and yarns—(i) Gen- eral. An article otherwise described under paragraph (a) of this section will not be ineligible for the preferential treatment referred to in § 10.241 because the article contains:

(A) Findings and trimmings of for- eign origin, if the value of those find- ings and trimmings does not exceed 25 percent of the cost of the components of the assembled article. For purposes of this section ‘‘findings and trim- mings’’ include, but are not limited to, sewing thread, hooks and eyes, snaps, buttons, ‘‘bow buds,’’ decorative lace trim, elastic strips, zippers (including zipper tapes), and labels;

(B) Interlinings of foreign origin, if the value of those interlinings does not exceed 25 percent of the cost of the components of the assembled article. For purposes of this section ‘‘inter- linings’’ include only a chest type plate, a ‘‘hymo’’ piece, or ‘‘sleeve head- er,’’ of woven or weft-inserted warp knit construction and of coarse animal hair or man-made filaments;

(C) Any combination of findings and trimmings of foreign origin and inter- linings of foreign origin, if the total value of those findings and trimmings

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00225 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

216

19 CFR Ch. I (4–1–12 Edition)§ 10.244

and interlinings does not exceed 25 per- cent of the cost of the components of the assembled article; or

(D) Yarns not wholly formed in the United States or in one or more ATPDEA beneficiary countries if the total weight of all those yarns is not more than 7 percent of the total weight of the article.

(ii) ‘‘Cost’’ and ‘‘value’’ defined. The ‘‘cost’’ of components and the ‘‘value’’ of findings and trimmings or inter- linings referred to in paragraph (c)(1)(i) of this section means:

(A) The ex-factory price of the com- ponents, findings and trimmings, or interlinings as set out in the invoice or other commercial documents, or, if the price is other than ex-factory, the price as set out in the invoice or other com- mercial documents adjusted to arrive at an ex-factory price; or

(B) If the price cannot be determined under paragraph (c)(1)(ii)(A) of this sec- tion or if CBP finds that price to be un- reasonable, all reasonable expenses in- curred in the growth, production, man- ufacture, or other processing of the components, findings and trimmings, or interlinings, including the cost or value of materials and general ex- penses, plus a reasonable amount for profit.

(iii) Treatment of yarns as findings or trimmings. If any yarns not wholly formed in the United States or one or more ATPDEA beneficiary countries are used in an article as a finding or trimming described in paragraph (c)(1)(i)(A) of this section, the yarns will be considered to be a finding or trimming for purposes of paragraph (c)(1)(i) of this section.

(2) Special rule for nylon filament yarn. An article otherwise described under paragraph (a)(1)(i) through (iii), (a)(2), or (a)(7) of this section will not be in- eligible for the preferential treatment referred to in § 10.241 because the arti- cle contains nylon filament yarn (other than elastomeric yarn) that is classifi- able in subheading 5402.10.30, 5402.10.60, 5402.31.30, 5402.31.60, 5402.32.30, 5402.32.60, 5402.41.10, 5402.41.90, 5402.51.00, or 5402.61.00 of the HTSUS and that is en- tered free of duty from Canada, Mexico, or Israel.

(d) Imported directly defined. For pur- poses of paragraph (a) of this section, the words ‘‘imported directly’’ mean:

(1) Direct shipment from any ATPDEA beneficiary country to the United States without passing through the territory of any country that is not an ATPDEA beneficiary country;

(2) If the shipment is from any ATPDEA beneficiary country to the United States through the territory of any country that is not an ATPDEA beneficiary country, the articles in the shipment do not enter into the com- merce of any country that is not an ATPDEA beneficiary country while en route to the United States and the in- voices, bills of lading, and other ship- ping documents show the United States as the final destination; or

(3) If the shipment is from any ATPDEA beneficiary country to the United States through the territory of any country that is not an ATPDEA beneficiary country, and the invoices and other documents do not show the United States as the final destination, the articles in the shipment upon ar- rival in the United States are imported directly only if they:

(i) Remained under the control of the customs authority of the intermediate country;

(ii) Did not enter into the commerce of the intermediate country except for the purpose of sale other than at retail, and the port director is satisfied that the importation results from the origi- nal commercial transaction between the importer and the producer or the producer’s sales agent; and

(iii) Were not subjected to operations other than loading or unloading, and other activities necessary to preserve the articles in good condition.

§ 10.244 Certificate of Origin.

(a) General. A Certificate of Origin must be employed to certify that an apparel or other textile article being exported from an ATPDEA beneficiary country to the United States qualifies for the preferential treatment referred to in § 10.241. The Certificate of Origin must be prepared in the ATPDEA bene- ficiary country by the producer or ex- porter or by the producer’s or export- er’s authorized agent in the format

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00226 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

217

U.S. Customs and Border Protection, DHS; Treasury § 10.244

specified in paragraph (b) of this sec- tion. If the person preparing the Cer- tificate of Origin is not the producer of the article, the person may complete and sign a Certificate of Origin on the basis of:

(1) The person’s reasonable reliance on the producer’s written representa- tion that the article qualifies for pref- erential treatment; or

(2) A completed and signed Certifi- cate of Origin for the article volun- tarily provided to the person by the producer.

(b) Form of Certificate. The Certificate of Origin referred to in paragraph (a) of this section must be in the following format:

ANDEAN TRADE PROMOTION AND DRUG ERADICATION ACT TEXTILE CERTIFICATE OF ORIGIN

1. Exporter Name & Address:

2. Producer Name & Address:

3. Importer Name & Address:

4. Description of Article:

5. Preference Group:

Group Each Description Below Is Only a Summary of the Cited CFR Provision.

19 CFR

A ........ Apparel assembled from U.S. formed, dyed, printed and finished fabrics or fabric components, or U.S. formed knit-to-shape components from U.S. or Andean yarns.

10.243(a)(1)(i).

B ........ Apparel assembled from Andean chief value llama, alpaca or vicuña fabrics, fabric components, or knit-to-shape components, from Andean yarns.

10.243(a)(1)(ii).

C ........ Apparel assembled from fabrics or yarns considered as being in short supply in the NAFTA.

10.243(a)(1)(iii).

D ........ Apparel assembled from fabrics or yarns des- ignated as not available in commercial quan- tities in the United States.

10.243(a)(1)(iv).

E ........ Apparel assembled from a combination of two or more yarns, fabrics, fabric components, or knit- to-shape components described in preference groups A though D.

10.243(a)(2).

F ........ Handloomed, handmade, or folklore textile and ap- parel goods.

10.243(a)(3).

G ........ Brassieres assembled in the U.S. and/or one or more Andean beneficiary countries.

10.243(a)(4).

H ........ Textile luggage assembled from U.S. formed fabrics from U.S. yarns.

10.243(a)(5)&(6).

I ......... Apparel assembled from Andean formed fabrics, fabric components, or knit-to-shape components from U.S. or Andean yarns, whether or not also assembled, in part, from yarns, fabrics and fabric components described in preference groups A through D.

10.243(a)(7).

6. U.S./Andean Fabric Producer Name & Address:

7. U.S./Andean Yarn Producer Name & Address:

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00227 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

218

19 CFR Ch. I (4–1–12 Edition)§ 10.244

ANDEAN TRADE PROMOTION AND DRUG ERADICATION ACT TEXTILE CERTIFICATE OF ORIGIN— Continued

8. Handloomed, Handmade, or Folklore Article:

9. Name of Short Supply Fabric or Yarn:

I certify that the information on this document is complete and accurate and I assume the responsibility for proving such representations. I understand that I am liable for any false statements or material omissions made on or in con- nection with this document. I agree to maintain, and present upon request, documentation necessary to support this certificate.

10. Authorized Signature:

11. Company:

12. Name: (Print or Type)

13. Title:

14. Date: (DD/MM/YY)

15. Blanket Period: From: To:

16. Telephone: Facsimile:

(c) Preparation of Certificate. The fol- lowing rules will apply for purposes of completing the Certificate of Origin set forth in paragraph (b) of this section:

(1) Blocks 1 through 5 pertain only to the final article exported to the United States for which preferential treat- ment may be claimed;

(2) Block 1 should state the legal name and address (including country) of the exporter;

(3) Block 2 should state the legal name and address (including country) of the producer. If there is more than one producer, attach a list stating the legal name and address (including country) of all additional producers. If this information is confidential, it is acceptable to state ‘‘available to Cus- toms and Border Protection (CBP) upon request’’ in block 2. If the pro- ducer and the exporter are the same, state ‘‘same’’ in block 2;

(4) Block 3 should state the legal name and address (including country) of the importer;

(5) Block 4 should provide a full de- scription of each article. The descrip-

tion should be sufficient to relate it to the invoice description and to the de- scription of the article in the inter- national Harmonized System. Include the invoice number as shown on the commercial invoice or, if the invoice number is not known, include another unique reference number such as the shipping order number;

(6) In block 5, insert the letter that designates the preference group which applies to the article according to the description contained in the CFR pro- vision cited on the Certificate for that group;

(7) Blocks 6 through 9 must be com- pleted only when the block in question calls for information that is relevant to the preference group identified in block 5;

(8) Block 6 should state the legal name and address (including country) of the fabric producer;

(9) Block 7 should state the legal name and address (including country) of the yarn producer;

(10) Block 8 should state the name of the folklore article or should state that

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00228 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

219

U.S. Customs and Border Protection, DHS; Treasury § 10.246

the article is handloomed or handmade of handloomed fabric;

(11) Block 9 should be completed if the article described in block 4 incor- porates a fabric or yarn described in preference group C or D and should state the name of the fabric or yarn that has been considered as being in short supply in the NAFTA or that has been designated as not available in commercial quantities in the United States. Block 9 also should be com- pleted if preference group E or I applies to the article described in block 4 and the article incorporates a fabric or yarn described in preference group C or D;

(12) Block 10 must contain the signa- ture of the producer or exporter or the producer’s or exporter’s authorized agent having knowledge of the relevant facts;

(13) Block 14 should reflect the date on which the Certificate was completed and signed;

(14) Block 15 should be completed if the Certificate is intended to cover multiple shipments of identical arti- cles as described in block 4 that are im- ported into the United States during a specified period of up to one year (see § 10.246(b)(4)(ii)). The ‘‘from’’ date is the date on which the Certificate became applicable to the article covered by the blanket Certificate (this date may be prior to the date reflected in block 14). The ‘‘to’’ date is the date on which the blanket period expires; and

(15) The Certificate may be printed and reproduced locally. If more space is needed to complete the Certificate, at- tach a continuation sheet.

§ 10.245 Filing of claim for preferential treatment.

(a) Declaration. In connection with a claim for preferential treatment for an apparel or other textile article de- scribed in § 10.243, the importer must make a written declaration that the article qualifies for that treatment. The inclusion on the entry summary, or equivalent documentation, of the subheading within Chapter 98 of the HTSUS under which the article is clas- sified will constitute the written dec- laration. Except in any of the cir- cumstances described in § 10.246(d)(1), the declaration required under this

paragraph must be based on a Certifi- cate of Origin that has been completed and properly executed in accordance with § 10.244, that covers the article being imported, and that is in the pos- session of the importer.

(b) Corrected declaration. If, after making the declaration required under paragraph (a) of this section, the im- porter has reason to believe that a Cer- tificate of Origin on which a declara- tion was based contains information that is not correct, the importer must within 30 calendar days after the date of discovery of the error make a cor- rected declaration and pay any duties that may be due. A corrected declara- tion will be effected by submission of a letter or other written statement to the CBP port where the declaration was originally filed.

§ 10.246 Maintenance of records and submission of Certificate by im- porter.

(a) Maintenance of records. Each im- porter claiming preferential treatment for an article under § 10.245 must main- tain in the United States, in accord- ance with the provisions of part 163 of this chapter, all records relating to the importation of the article. Those records must include a copy of the Cer- tificate of Origin referred to in § 10.245(a) and any other relevant docu- ments or other records as specified in § 163.1(a) of this chapter.

(b) Submission of Certificate. An im- porter who claims preferential treat- ment on an apparel or other textile ar- ticle under § 10.245(a) must provide, at the request of the port director, a copy of the Certificate of Origin pertaining to the article. A Certificate of Origin submitted to CBP under this para- graph:

(1) Must be in writing or must be transmitted electronically through any electronic data interchange system au- thorized by CBP for that purpose;

(2) If in writing, must be signed by the producer or exporter or the pro- ducer’s or exporter’s authorized agent having knowledge of the relevant facts;

(3) Must be completed either in the English language or in the language of the country from which the article is exported. If the Certificate is com- pleted in a language other than

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00229 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

220

19 CFR Ch. I (4–1–12 Edition)§ 10.247

English, the importer must provide to CBP upon request a written English translation of the Certificate; and

(4) May be applicable to: (i) A single importation of an article

into the United States, including a sin- gle shipment that results in the filing of one or more entries and a series of shipments that results in the filing of one entry; or

(ii) Multiple importations of iden- tical articles into the United States that occur within a specified blanket period, not to exceed 12 months, set out in the Certificate by the exporter. For purposes of this paragraph and § 10.244(c)(14), ‘‘identical articles’’ means articles that are the same in all material respects, including physical characteristics, quality, and reputa- tion.

(c) Correction and nonacceptance of Certificate. If the port director deter- mines that a Certificate of Origin is il- legible or defective or has not been completed in accordance with para- graph (b) of this section, the importer will be given a period of not less than five working days to submit a cor- rected Certificate. A Certificate will not be accepted in connection with sub- sequent importations during a period referred to in paragraph (b)(4)(ii) of this section if the port director deter- mined that a previously imported iden- tical article covered by the Certificate did not qualify for preferential treat- ment.

(d) Certificate not required—(1) Gen- eral. Except as otherwise provided in paragraph (d)(2) of this section, an im- porter is not required to have a Certifi- cate of Origin in his possession for:

(i) An importation of an article for which the port director has in writing waived the requirement for a Certifi- cate of Origin because the port director is otherwise satisfied that the article qualifies for preferential treatment;

(ii) A non-commercial importation of an article; or

(iii) A commercial importation of an article whose value does not exceed US$2,500, provided that, unless waived by the port director, the producer, ex- porter, importer or authorized agent includes on, or attaches to, the invoice or other document accompanying the

shipment the following signed state- ment:

I hereby certify that the article covered by this shipment qualifies for preferential treatment under the ATPDEA. Check One: ( ) Producer ( ) Exporter ( ) Importer ( ) Agent llllllllllllllllllllllll

Name llllllllllllllllllllllll

Title llllllllllllllllllllllll

Address llllllllllllllllllllllll

Signature and Date

(2) Exception. If the port director de- termines that an importation described in paragraph (d)(1) of this section forms part of a series of importations that may reasonably be considered to have been undertaken or arranged for the purpose of avoiding a Certificate of Or- igin requirement under §§ 10.244 through 10.246, the port director will notify the importer in writing that for that importation the importer must have in his possession a valid Certifi- cate of Origin to support the claim for preferential treatment. The importer will have 30 calendar days from the date of the written notice to obtain a valid Certificate of Origin, and a fail- ure to timely obtain the Certificate of Origin will result in denial of the claim for preferential treatment. For pur- poses of this paragraph, a ‘‘series of im- portations’’ means two or more entries covering articles arriving on the same day from the same exporter and con- signed to the same person.

§ 10.247 Verification and justification of claim for preferential treatment.

(a) Verification by CBP. A claim for preferential treatment made under § 10.245, including any statements or other information contained on a Cer- tificate of Origin submitted to CBP under § 10.246, will be subject to what- ever verification the port director deems necessary. In the event that the port director for any reason is pre- vented from verifying the claim, the port director may deny the claim for preferential treatment. A verification of a claim for preferential treatment

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00230 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

221

U.S. Customs and Border Protection, DHS; Treasury § 10.248

may involve, but need not be limited to, a review of:

(1) All records required to be made, kept, and made available to CBP by the importer or any other person under part 163 of this chapter;

(2) Documentation and other infor- mation regarding the country of origin of an article and its constituent mate- rials, including, but not limited to, production records, information relat- ing to the place of production, the number and identification of the types of machinery used in production, and the number of workers employed in production; and

(3) Evidence to document the use of U.S. or ATPDEA beneficiary country materials in the production of the arti- cle in question, such as purchase or- ders, invoices, bills of lading and other shipping documents, and customs im- port and clearance documents.

(b) Importer requirements. In order to make a claim for preferential treat- ment under § 10.245, the importer:

(1) Must have records that explain how the importer came to the conclu- sion that the apparel or other textile article qualifies for preferential treat- ment. Those records must include doc- uments that support a claim that the article in question qualifies for pref- erential treatment because it is specifi- cally described in one of the provisions under § 10.243(a). If the importer is claiming that the article incorporates fabric or yarn that was wholly formed in the United States or in an ATPDEA beneficiary country, the importer must have records that identify the producer of the fabric or yarn. A properly com- pleted Certificate of Origin in the form set forth in § 10.244(b) is a record that would serve these purposes;

(2) Must establish and implement in- ternal controls which provide for the periodic review of the accuracy of the Certificates of Origin or other records referred to in paragraph (b)(1) of this section;

(3) Must have shipping papers that show how the article moved from the ATPDEA beneficiary country to the United States. If the imported article was shipped through a country other than an ATPDEA beneficiary country and the invoices and other documents from the ATPDEA beneficiary country

do not show the United States as the final destination, the importer also must have documentation that dem- onstrates that the conditions set forth in § 10.243(d)(3)(i) through (iii) were met; and

(4) Must be prepared to explain, upon request from CBP, how the records and internal controls referred to in para- graphs (b)(1) through (b)(3) of this sec- tion justify the importer’s claim for preferential treatment.

§ 10.248 Additional requirements for preferential treatment of bras- sieres.

(a) Definitions. When used in this sec- tion, the following terms have the meanings indicated:

(1) Producer. ‘‘Producer’’ means an in- dividual, corporation, partnership, as- sociation, or other entity or group that exercises direct, daily operational con- trol over the production process in an ATPDEA beneficiary country.

(2) Entity controlling production. ‘‘En- tity controlling production’’ means an individual, corporation, partnership, association, or other entity or group that is not a producer and that con- trols the production process in an ATPDEA beneficiary country through a contractual relationship or other in- direct means.

(3) Fabrics formed in the United States. ‘‘Fabrics formed in the United States’’ means fabrics that were produced by a weaving, knitting, needling, tufting, felting, entangling or other fabric- making process performed in the United States.

(4) Cost. ‘‘Cost’’ when used with ref- erence to fabrics formed in the United States means:

(i) The price of the fabrics when last purchased, f.o.b. port of exportation, as set out in the invoice or other commer- cial documents, or, if the price is other than f.o.b. port of exportation:

(A) The price as set out in the invoice or other commercial documents ad- justed to arrive at an f.o.b. port of ex- portation price; or

(B) If no exportation to an ATPDEA beneficiary country is involved, the price as set out in the invoice or other commercial documents, less the freight, insurance, packing, and other

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00231 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

222

19 CFR Ch. I (4–1–12 Edition)§ 10.248

costs incurred in transporting the fab- rics to the place of production if in- cluded in that price; or

(ii) If the price cannot be determined under paragraph (a)(4)(i) of this section or if CBP finds that price to be unrea- sonable, all reasonable expenses in- curred in the growth, production, man- ufacture, or other processing of the fabrics, including the cost or value of materials (which includes the cost of non-recoverable scrap generated in forming the fabrics) and general ex- penses, plus a reasonable amount for profit, and the freight, insurance, pack- ing, and other costs, if any, incurred in transporting the fabrics to the port of exportation.

(5) Declared customs value. ‘‘Declared customs value’’ when used with ref- erence to fabric contained in an article means the sum of:

(i) The cost of fabrics formed in the United States that the producer or en- tity controlling production can verify; and

(ii) The cost of all other fabric con- tained in the article, exclusive of all findings and trimmings, determined as follows:

(A) In the case of fabric purchased by the producer or entity controlling pro- duction, the f.o.b. port of exportation price of the fabric as set out in the in- voice or other commercial documents, or, if the price is other than f.o.b. port of exportation:

(1) The price as set out in the invoice or other commercial documents ad- justed to arrive at an f.o.b. port of ex- portation price, plus expenses for em- broidering and dyeing, printing, and finishing operations applied to the fab- ric if not included in that price; or

(2) If no exportation to an ATPDEA beneficiary country is involved, the price as set out in the invoice or other commercial documents, plus expenses for embroidering and dyeing, printing, and finishing operations applied to the fabric if not included in that price, but less the freight, insurance, packing, and other costs incurred in trans- porting the fabric to the place of pro- duction if included in that price;

(B) In the case of fabric for which the cost cannot be determined under para- graph (a)(5)(ii)(A) of this section or if CBP finds that cost to be unreasonable,

all reasonable expenses incurred in the growth, production, or manufacture of the fabric, including the cost or value of materials (which includes the cost of non-recoverable scrap generated in the growth, production, or manufacture of the fabric), general expenses and em- broidering and dyeing, printing, and finishing expenses, plus a reasonable amount for profit, and the freight, in- surance, packing, and other costs, if any, incurred in transporting the fabric to the port of exportation;

(C) In the case of fabric components purchased by the producer or entity controlling production, the f.o.b. port of exportation price of those fabric components as set out in the invoice or other commercial documents, less the cost or value of any non-textile mate- rials, and less expenses for cutting or other processing to create the fabric components other than knitting to shape, that the producer or entity con- trolling production can verify, or, if the price is other than f.o.b. port of ex- portation:

(1) The price as set out in the invoice or other commercial documents ad- justed to arrive at an f.o.b. port of ex- portation price, less the cost or value of any non-textile materials, and less expenses for cutting or other proc- essing to create the fabric components other than knitting to shape, that the producer or entity controlling produc- tion can verify; or

(2) If no exportation to an ATPDEA beneficiary country is involved, the price as set out in the invoice or other commercial documents, less the cost or value of any non-textile materials, and less expenses for cutting or other proc- essing to create the fabric components other than knitting to shape, that the producer or entity controlling produc- tion can verify, and less the freight, in- surance, packing, and other costs in- curred in transporting the fabric com- ponents to the place of production if included in that price; and

(D) In the case of fabric components for which a fabric cost cannot be deter- mined under paragraph (a)(5)(ii)(C) of this section or if CBP finds that cost to be unreasonable: All reasonable ex- penses incurred in the growth, produc- tion, or manufacture of the fabric com- ponents, including the cost or value of

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00232 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

223

U.S. Customs and Border Protection, DHS; Treasury § 10.248

materials (which does not include the cost of recoverable scrap generated in the growth, production, or manufac- ture of the fabric components) and gen- eral expenses, but excluding the cost or value of any non-textile materials, and excluding expenses for cutting or other processing to create the fabric compo- nents other than knitting to shape, that the producer or entity controlling production can verify, plus a reason- able amount for profit, and the freight, insurance, packing, and other costs, if any, incurred in transporting the fabric components to the port of exportation.

(6) Year. ‘‘Year’’ means a 12-month period beginning on October 1 and end- ing on September 30 but does not in- clude any 12-month period that began prior to October 1, 2002.

(7) Entered. ‘‘Entered’’ means entered, or withdrawn from warehouse for con- sumption, in the customs territory of the United States.

(b) Limitations on preferential treat- ment—(1) General. During the year that begins on October 1, 2003, and during any subsequent year, articles of a pro- ducer or an entity controlling produc- tion that conform to the production standards set forth in § 10.243(a)(4) will be eligible for preferential treatment only if:

(i) The aggregate cost of fabrics (ex- clusive of all findings and trimmings) formed in the United States that were used in the production of all of those articles of that producer or that entity controlling production that are entered as articles described in § 10.243(a)(4) during the immediately preceding year was at least 75 percent of the aggregate declared customs value of the fabric (exclusive of all findings and trim- mings) contained in all of those arti- cles of that producer or that entity controlling production that are entered as articles described in § 10.243(a)(4) during that year; or

(ii) In a case in which the 75 percent requirement set forth in paragraph (b)(1)(i) of this section was not met during a year and therefore those arti- cles of that producer or that entity controlling production were not eligi- ble for preferential treatment during the following year, the aggregate cost of fabrics (exclusive of all findings and trimmings) formed in the United

States that were used in the produc- tion of all of those articles of that pro- ducer or that entity controlling pro- duction that conform to the production standards set forth in § 10.243(a)(4) and that were entered during the imme- diately preceding year was at least 85 percent of the aggregate declared cus- toms value of the fabric (exclusive of all findings and trimmings) contained in all of those articles of that producer or that entity controlling production that conform to the production stand- ards set forth in § 10.243(a)(4) and that were entered during that year; and

(iii) In conjunction with the filing of the claim for preferential treatment under § 10.245, the importer records on the entry summary or warehouse with- drawal for consumption (CBP Form 7501, column 34), or its electronic equivalent, the distinct and unique identifier assigned by CBP to the appli- cable documentation prescribed under paragraph (c) of this section.

(2) Rules of application—(i) General. For purposes of paragraphs (b)(1)(i) and (b)(1)(ii) of this section and for pur- poses of preparing and filing the docu- mentation prescribed in paragraph (c) of this section, the following rules will apply:

(A) The articles in question must have been produced in the manner specified in § 10.243(a)(4) and the arti- cles in question must be entered within the same year;

(B) Articles that are exported to countries other than the United States and are never entered are not to be considered in determining compliance with the 75 or 85 percent standard spec- ified in paragraph (b)(1)(i) or paragraph (b)(1)(ii) of this section;

(C) Articles that are entered under an HTSUS subheading other than the HTSUS subheading which pertains to articles described in § 10.243(a)(4) are not to be considered in determining compliance with the 75 percent stand- ard specified in paragraph (b)(1)(i) of this section;

(D) For purposes of determining com- pliance with the 85 percent standard specified in paragraph (b)(1)(ii) of this section, all articles that conform to the production standards set forth in

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00233 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

224

19 CFR Ch. I (4–1–12 Edition)§ 10.248

§ 10.243(a)(4) must be considered, re- gardless of the HTSUS subheading under which they were entered;

(E) Fabric components and fabrics that constitute findings or trimmings are not to be considered in determining compliance with the 75 or 85 percent standard specified in paragraph (b)(1)(i) or paragraph (b)(1)(ii) of this section;

(F) Beginning October 1, 2003, in order for articles to be eligible for pref- erential treatment in a given year, a producer of, or entity controlling pro- duction of, those articles must have met the 75 percent standard specified in paragraph (b)(1)(i) of this section during the immediately preceding year. If articles of a producer or entity controlling production fail to meet the 75 percent standard specified in para- graph (b)(1)(i) of this section during a year, articles of that producer or enti- ty controlling production:

(1) Will not be eligible for pref- erential treatment during the fol- lowing year;

(2) Will remain ineligible for pref- erential treatment until the year that follows a year in which articles of that producer or entity controlling produc- tion met the 85 percent standard speci- fied in paragraph (b)(1)(ii) of this sec- tion; and

(3) After the 85 percent standard specified in paragraph (b)(1)(ii) of this section has been met, will again be sub- ject to the 75 percent standard speci- fied in paragraph (b)(1)(i) of this sec- tion during the following year for pur- poses of determining eligibility for preferential treatment in the next year.

(G) A new producer or new entity controlling production, that is, a pro- ducer or entity controlling production who did not produce or control produc- tion of articles that were entered as ar- ticles described in § 10.243(a)(4) during the immediately preceding year, must first establish compliance with the 85 percent standard specified in paragraph (b)(1)(ii) of this section as a pre- requisite to preparation of the declara- tion of compliance referred to in para- graph (c) of this section;

(H) A declaration of compliance pre- pared by a producer or by an entity controlling production must cover all production of that producer or all pro-

duction that the entity controls for the year in question;

(I) A producer would not prepare a declaration of compliance if all of its production is covered by a declaration of compliance prepared by an entity controlling production;

(J) In the case of a producer, the 75 or 85 percent standard specified in para- graph (b)(1)(i) or paragraph (b)(1)(ii) of this section and the declaration of compliance procedure under paragraph (c) of this section apply to all articles of that producer for the year in ques- tion, even if some but not all of that production is also covered by a declara- tion of compliance prepared by an enti- ty controlling production;

(K) The U.S. importer does not have to be the producer or the entity con- trolling production who prepared the declaration of compliance; and

(L) The exclusion references regard- ing findings and trimmings in para- graph (b)(1)(i) and paragraph (b)(1)(ii) of this section apply to all findings and trimmings, whether or not they are of foreign origin.

(ii) Examples. The following examples will illustrate application of the prin- ciples set forth in paragraph (b)(2)(i) of this section.

Example 1. An ATPDEA beneficiary coun- try producer of articles that meet the pro- duction standards specified in § 10.243(a)(4) in the first year sends 50 percent of that pro- duction to ATPDEA region markets and the other 50 percent to the U.S. market; the cost of the fabrics formed in the United States equals 100 percent of the value of all of the fabric in the articles sent to the ATPDEA re- gion and 60 percent of the value of all of the fabric in the articles sent to the United States. Although the cost of fabrics formed in the United States is more than 75 percent of the value of all of the fabric used in all of the articles produced, this producer could not prepare a valid declaration of compli- ance because the articles sent to the United States did not meet the minimum 75 percent standard.

Example 2. A producer sends to the United States in the first year three shipments of articles that meet the description in § 10.243(a)(4); one of those shipments is en- tered under the HTSUS subheading that cov- ers articles described in § 10.243(a)(4), the sec- ond shipment is entered under the HTSUS subheading that covers articles described in § 10.243(a)(7), and the third shipment is en- tered under subheading 9802.00.80, HTSUS. In

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00234 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

225

U.S. Customs and Border Protection, DHS; Treasury § 10.248

determining whether the minimum 75 per- cent standard has been met in the first year for purposes of entry of articles under the HTSUS subheading that covers articles de- scribed in § 10.243(a)(4) during the following (that is, second) year, consideration must be restricted to the articles in the first ship- ment and therefore must not include the ar- ticles in the second and third shipments.

Example 3. A producer in the second year begins production of articles that conform to the production standards specified in § 10.243(a)(4); some of those articles are en- tered in that year under HTSUS subheading 6212.10 and others under HTSUS subheading 9802.00.80 but none are entered in that year under the HTSUS subheading which pertains to articles described in § 10.243(a)(4) because the 75 percent standard had not been met in the preceding (that is, first) year. In this case the 85 percent standard applies, and all of the articles that were entered under the various HTSUS provisions in the second year must be taken into account in determining whether that 85 percent standard has been met. If the 85 percent was met in the aggre- gate for all of the articles entered in the sec- ond year, in the next (that is, third) year ar- ticles of that producer may receive pref- erential treatment under the HTSUS sub- heading which pertains to articles described in § 10.243(a)(4).

Example 4. An entity controlling produc- tion of articles that meet the description in § 10.243(a)(4) buys for the U.S., Canadian and Mexican markets; the articles in each case are first sent to the United States where they are entered for consumption and then placed in a commercial warehouse from which they are shipped to various stores in the United States, Canada and Mexico. Not- withstanding the fact that some of the arti- cles ultimately ended up in Canada or Mex- ico, a declaration of compliance prepared by the entity controlling production must cover all of the articles rather than only those that remained in the United States because all of those articles had been entered for con- sumption.

Example 5. Fabric is cut and sewn in the United States with other U.S. materials to form cups which are joined together to form brassiere front subassemblies in the United States, and those front subassemblies are then placed in a warehouse in the United States where they are held until the fol- lowing year; during that following year all of the front subassemblies are shipped to an ATPDEA beneficiary country where they are assembled with elastic strips for use as bras- siere straps and labels produced in an Asian country and other fabrics, components or materials produced in the ATPDEA bene- ficiary country to form articles that meet the production standards specified in § 10.243(a)(4) and that are then shipped to the United States and entered during that same

year. In determining whether the entered ar- ticles meet the minimum 75 or 85 percent standard, the fabric in the labels is to be dis- regarded entirely because the labels con- stitute findings or trimmings for purposes of this section, and all of the fabric in the front subassemblies is countable because it was all formed in the United States and used in the production of articles that were entered in the same year.

Example 6. An ATPDEA beneficiary coun- try producer’s entire production of articles that meet the description in § 10.243(a)(4) is sent to a U.S. importer in two separate ship- ments, one in February and the other in June of the same calendar year; the articles shipped in February do not meet the min- imum 75 percent standard, the articles shipped in June exceed the 85 percent stand- ard, and the articles in the two shipments, taken together, do meet the 75 percent standard; the articles covered by the Feb- ruary shipment are entered for consumption on March 1 of that calendar year, and the ar- ticles covered by the June shipment are placed in a CBP bonded warehouse upon ar- rival and are subsequently withdrawn from warehouse for consumption on November 1 of that calendar year. The ATPDEA beneficiary country producer may not prepare a valid declaration of compliance covering the arti- cles in the first shipment because those arti- cles did not meet the minimum 75 percent standard and because those articles cannot be included with the articles of the second shipment on the same declaration of compli- ance since they were entered in a different year. However, the ATPDEA beneficiary country producer may prepare a valid dec- laration of compliance covering the articles in the second shipment because those arti- cles did meet the requisite 85 percent stand- ard which would apply for purposes of entry of articles in the following year.

Example 7. A producer in the second year begins production of articles exclusively for the U.S. market that meet the production standards specified in § 10.243(a)(4), but the entered articles do not meet the requisite 85 percent standard until the third year. The producer’s articles may not receive pref- erential treatment during the second year because there was no production (and thus there were no entered articles) in the imme- diately preceding (that is, first) year on which to assess compliance with the 75 per- cent standard. The producer’s articles also may not receive preferential treatment dur- ing the third year because the 85 percent standard was not met in the immediately preceding (that is, second) year. However, the producer’s articles are eligible for pref- erential treatment during the fourth year based on compliance with the 85 percent standard in the immediately preceding (that is, third) year.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00235 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

226

19 CFR Ch. I (4–1–12 Edition)§ 10.248

Example 8. An entity controlling produc- tion (Entity A) uses five ATPDEA bene- ficiary country producers (Producers 1–5), all of which produce only articles that meet the description in § 10.243(a)(4); Producers 1–4 send all of their production to the United States and Producer 5 sends 10 percent of its production to the United States and the rest to Europe; Producers 1–3 and Producer 5 produce only pursuant to contracts with En- tity A, but Producer 4 also operates inde- pendently of Entity A by producing for sev- eral U.S. importers, one of which is an entity controlling production (Entity B) that also controls all of the production of articles of one other producer (Producer 6) which sends all of its production to the United States. A declaration of compliance prepared by Enti- ty A must cover all of the articles of Pro- ducers 1–3 and the 10 percent of articles of Producer 5 that are sent to the United States and that portion of the articles of Producer 4 that are produced pursuant to the contract with Entity A, because Entity A controls the production of those articles. There is no need for Producers 1–3 and Producer 5 to prepare a declaration of compliance because they have no production that is not covered by a declaration of compliance prepared by an en- tity controlling production. A declaration of compliance prepared by Producer 4 would cover all of its production, that is, articles produced for Entity A, articles produced for Entity B, and articles produced independ- ently for other U.S. importers; a declaration of compliance prepared by Entity B must cover that portion of the production of Pro- ducer 4 that it controls as well as all of the production of Producer 6 because Entity B also controls all of the production of Pro- ducer 6. Producer 6 would not prepare a dec- laration of compliance because all of its pro- duction is covered by the declaration of com- pliance prepared by Entity B.

(c) Documentation—(1) Initial declara- tion of compliance. In order for an im- porter to comply with the requirement set forth in paragraph (b)(1)(iii) of this section, the producer or the entity con- trolling production must have filed with CBP, in accordance with para- graph (c)(4) of this section, a declara- tion of compliance with the applicable 75 or 85 percent requirement prescribed in paragraph (b)(1)(i) or (b)(1)(ii) of this section. After filing of the declaration of compliance has been completed, CBP will advise the producer or the entity controlling production of the distinct and unique identifier assigned to that

declaration. The producer or the entity controlling production will then be re- sponsible for advising each appropriate U.S. importer of that distinct and unique identifier for purposes of re- cording that identifier on the entry summary or warehouse withdrawal. In order to provide sufficient time for ad- vising the U.S. importer of that dis- tinct and unique identifier prior to the arrival of the articles in the United States, the producer or the entity con- trolling production should file the dec- laration of compliance with CBP at least 10 calendar days prior to the date of the first shipment of the articles to the United States.

(2) Amended declaration of compliance. If the information on the declaration of compliance referred to in paragraph (c)(1) of this section is based on an esti- mate because final year-end informa- tion was not available at that time and the final data differs from the esti- mate, or if the producer or the entity controlling production has reason to believe for any other reason that the declaration of compliance that was filed contained erroneous information, within 30 calendar days after the final year-end information becomes avail- able or within 30 calendar days after the date of discovery of the error:

(i) The producer or the entity con- trolling production must file with the CBP office identified in paragraph (c)(4) of this section an amended dec- laration of compliance containing that final year-end information or other corrected information; or

(ii) If that final year-end information or other corrected information dem- onstrates noncompliance with the ap- plicable 75 or 85 percent requirement, the producer or the entity controlling production must in writing advise both the CBP office identified in paragraph (c)(4) of this section and each appro- priate U.S. importer of that fact.

(3) Form and preparation of declaration of compliance—(i) Form. The declaration of compliance referred to in paragraph (c)(1) of this section may be printed and reproduced locally and must be in the following format:

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00236 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

227

U.S. Customs and Border Protection, DHS; Treasury § 10.248

ANDEAN TRADE PROMOTION AND DRUG ERADICATION ACT DECLARATION OF COMPLIANCE FOR BRASSIERES

[19 CFR 10.243(a)(4) and 10.248]

1. Year beginning date: October 1, llllllllllll

Official U.S. CBP Use Only

Year ending date: September 30, llllllllllll

Assigned number: llllllllllll

Assignment date:llllllllllll

2. Identity of preparer (producer or entity con- trolling production):

Full name and address: Telephone number: llllllllllll Facsimile number: llllllllllll Importer identification number:llllll

3. If the preparer is an entity controlling production, provide the following for each producer:

Full name and address: llllllllllll

Telephone number: llllllllllll

Facsimile number: llllllllllll

4. Aggregate cost of fabrics (exclusive of all findings and trimmings) formed in the United States that were used in the production of brassieres that were entered during the year:

llllllllllll

5. Aggregate declared customs value of the fabric (exclusive of all findings and trimmings) con- tained in brassieres that were entered during the year:

llllllllllll

6. I declare that the aggregate cost of fabric (exclusive of all findings and trimmings) formed in the United States was at least 75 percent (or 85 percent, if applicable under 19 CFR 10.248(b)(1)(ii)) of the aggregate declared customs value of the fabric contained in bras- sieres entered during the year.

7. Authorized signa- ture:llllllllllll

8. Name and title (print or type):llllllllllll

Date:

(ii) Preparation. The following rules will apply for purposes of completing the declaration of compliance set forth in paragraph (c)(3)(i) of this section:

(A) In block 1, fill in the year com- mencing October 1 and ending Sep- tember 30 of the calendar year during which the applicable 75 or 85 percent standard specified in paragraph (b)(1)(i) or paragraph (b)(1)(ii) of this section was met;

(B) Block 2 should state the legal name and address (including country) of the preparer and should also include the preparer’s importer identification number (see § 24.5 of this chapter), if the preparer has one;

(C) Block 3 should state the legal name and address (including country) of the ATPDEA beneficiary country producer if that producer is not already identified in block 2. If there is more than one producer, attach a list stating the legal name and address (including country) of all additional producers;

(D) Blocks 4 and 5 apply only to arti- cles that were entered during the year identified in block 1; and

(E) In block 7, the signature must be that of an authorized officer, employee, agent or other person having knowl- edge of the relevant facts and the date

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00237 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

228

19 CFR Ch. I (4–1–12 Edition)§ 10.248

must be the date on which the declara- tion of compliance was completed and signed.

(4) Filing of declaration of compliance. The declaration of compliance referred to in paragraph (c)(1) of this section:

(i) Must be completed either in the English language or in the language of the country in which the articles cov- ered by the declaration were produced. If the declaration is completed in a language other than English, the pro- ducer or the entity controlling produc- tion must provide to CBP upon request a written English translation of the declaration; and

(ii) Must be filed with the New York Strategic Trade Center, Customs and Border Protection, 1 Penn Plaza, New York, New York 10119.

(d) Verification of declaration of compli- ance—(1) Verification procedure. A dec- laration of compliance filed under this section will be subject to whatever verification CBP deems necessary. In the event that CBP for any reason is prevented from verifying the state- ments made on a declaration of compli- ance, CBP may deny any claim for preferential treatment made under § 10.245 that is based on that declara- tion. A verification of a declaration of compliance may involve, but need not be limited to, a review of:

(i) All records required to be made, kept, and made available to CBP by the importer, the producer, the entity con- trolling production, or any other per- son under part 163 of this chapter;

(ii) Documentation and other infor- mation regarding all articles that meet the production standards specified in § 10.243(a)(4) that were exported to the United States and that were entered during the year in question, whether or not a claim for preferential treatment was made under § 10.245. Those records and other information include, but are not limited to, work orders and other production records, purchase orders, invoices, bills of lading and other ship- ping documents;

(iii) Evidence to document the cost of fabrics formed in the United States that were used in the production of the articles in question, such as purchase orders, invoices, bills of lading and other shipping documents, and customs import and clearance documents, work

orders and other production records, and inventory control records;

(iv) Evidence to document the cost or value of all fabric other than fabrics formed in the United States that were used in the production of the articles in question, such as purchase orders, invoices, bills of lading and other ship- ping documents, and customs import and clearance documents, work orders and other production records, and in- ventory control records; and

(v) Accounting books and documents to verify the records and information referred to in paragraphs (d)(1)(ii) through (d)(1)(iv) of this section. The verification of purchase orders, in- voices and bills of lading will be ac- complished through the review of a dis- tinct audit trail. The audit trail docu- ments must consist of a cash disburse- ment or purchase journal or equivalent records to establish the purchase of the fabric. The headings in each of these journals or other records must contain the date, vendor name, and amount paid for the fabric. The verification of production records and work orders will be accomplished through analysis of the inventory records of the pro- ducer or entity controlling production. The inventory records must reflect the production of the finished article which must be referenced to the original pur- chase order or lot number covering the fabric used in production. In the inven- tory production records, the inventory should show the opening balance of the inventory plus the purchases made dur- ing the accounting period and the in- ventory closing balance.

(2) Notice of determination. If, based on a verification of a declaration of com- pliance filed under this section, CBP determines that the applicable 75 or 85 percent standard specified in paragraph (b)(1)(i) or paragraph (b)(1)(ii) of this section was not met, CBP will publish a notice of that determination in the FEDERAL REGISTER.

EXTENSION OF ATPA BENEFITS TO TUNA AND CERTAIN OTHER NON-TEXTILE AR- TICLES

SOURCE: Sections 10.251 through 10.257 issued by T.D. 03–16, 68 FR 14497, Mar. 25, 2003; 68 FR 67349, Dec. 1, 2003, unless other- wise noted.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00238 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

229

U.S. Customs and Border Protection, DHS; Treasury § 10.253

§ 10.251 Applicability. Title XXXI of Public Law 107–210 (116

Stat. 933), entitled the Andean Trade Promotion and Drug Eradication Act (ATPDEA), amended sections 202, 203, 204, and 208 of the Andean Trade Pref- erence Act (the ATPA, 19 U.S.C. 3201– 3206) to authorize the President to ex- tend additional trade benefits to ATPA beneficiary countries that have been designated as ATPDEA beneficiary countries. Sections 204(b)(1) and (b)(4) of the ATPA (19 U.S.C. 3203(b)(1) and (b)(4)) provide for the preferential treatment of certain non-textile arti- cles that were not entitled to duty-free treatment under the ATPA prior to en- actment of the ATPDEA. The provi- sions of §§ 10.251–10.257 of this part set forth the legal requirements and proce- dures that apply for purposes of obtain- ing preferential treatment pursuant to ATPA sections 204(b)(1) and (b)(4).

§ 10.252 Definitions. When used in §§ 10.251 through 10.257,

the following terms have the meanings indicated:

ATPA. ‘‘ATPA’’ means the Andean Trade Preference Act, 19 U.S.C. 3201– 3206.

ATPDEA beneficiary country. ‘‘ATPDEA beneficiary country’’ means a ‘‘beneficiary country’’ as defined in § 10.202(a) for purposes of the ATPA which the President also has des- ignated as a beneficiary country for purposes of preferential treatment of products under 19 U.S.C. 3203(b)(1) and (b)(4) and which has been the subject of a finding by the President or his des- ignee, published in the FEDERAL REG- ISTER, that the beneficiary country has satisfied the requirements of 19 U.S.C. 3203(b)(5)(A)(ii).

ATPDEA beneficiary country vessel. ‘‘ATPDEA beneficiary country vessel’’ means a vessel:

(a) Which is registered or recorded in an ATPDEA beneficiary country;

(b) Which sails under the flag of an ATPDEA beneficiary country;

(c) Which is at least 75 percent owned by nationals of an ATPDEA beneficiary country or by a company having its principal place of business in an ATPDEA beneficiary country, of which the manager or managers, chairman of the board of directors or of the super-

visory board, and the majority of the members of those boards are nationals of an ATPDEA beneficiary country and of which, in the case of a company, at least 50 percent of the capital is owned by an ATPDEA beneficiary country or by public bodies or nationals of an ATPDEA beneficiary country;

(d) Of which the master and officers are nationals of an ATPDEA bene- ficiary country; and

(e) Of which at least 75 percent of the crew are nationals of an ATPDEA ben- eficiary country.

HTSUS. ‘‘HTSUS’’ means the Har- monized Tariff Schedule of the United States.

Preferential treatment. ‘‘Preferential treatment’’ means entry, or with- drawal from warehouse for consump- tion, in the customs territory of the United States free of duty and free of any quantitative restrictions in the case of tuna described in § 10.253(a)(1) and free of duty in the case of any arti- cle described in § 10.253(a)(2).

United States vessel. ‘‘United States vessel’’ means either: a vessel having a certificate of documentation with a fishery endorsement under chapter 121 of title 46 of the United States Code; or a vessel that is documented under the laws of the United States and for which a license has been issued pursuant to section 9 of the South Pacific Tuna Act of 1988.

[T.D. 03–16, 68 FR 14497, Mar. 25, 2003; 68 FR 67349, Dec. 1, 2003, as amended by CBP Dec. 06–21, 71 FR 44583, Aug. 7, 2006]

§ 10.253 Articles eligible for pref- erential treatment.

(a) General. Preferential treatment applies to any of the following articles, provided that the article in question is imported directly into the customs ter- ritory of the United States from an ATPDEA beneficiary country within the meaning of paragraph (b) of this section:

(1) Tuna that is harvested by United States vessels or ATPDEA beneficiary country vessels, that is prepared or preserved in any manner, in an ATPDEA beneficiary country, in foil or other flexible airtight containers weighing with their contents not more than 6.8 kilograms each; and

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00239 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

230

19 CFR Ch. I (4–1–12 Edition)§ 10.253

(2) Any of the following articles that the President has determined are not import-sensitive in the context of im- ports from ATPDEA beneficiary coun- tries, provided that the article in ques- tion meets the country of origin and value content requirements set forth in paragraphs (c) and (d) of this section:

(i) Footwear not designated on De- cember 4, 1991, as eligible articles for the purpose of the Generalized System of Preferences (GSP) under Title V, Trade Act of 1974, as amended (19 U.S.C. 2461 through 2467);

(ii) Petroleum, or any product de- rived from petroleum, provided for in headings 2709 and 2710 of the HTSUS;

(iii) Watches and watch parts (includ- ing cases, bracelets, and straps), of whatever type including, but not lim- ited to, mechanical, quartz digital or quartz analog, if those watches or watch parts contain any material which is the product of any country with respect to which HTSUS column 2 rates of duty apply; and

(iv) Handbags, luggage, flat goods, work gloves, and leather wearing ap- parel that were not designated on Au- gust 5, 1983, as eligible articles for pur- poses of the GSP.

(b) Imported directly defined. For pur- poses of paragraph (a) of this section, the words ‘‘imported directly’’ mean:

(1) Direct shipment from any ATPDEA beneficiary country to the United States without passing through the territory of any country that is not an ATPDEA beneficiary country;

(2) If the shipment is from any ATPDEA beneficiary country to the United States through the territory of any country that is not an ATPDEA beneficiary country, the articles in the shipment do not enter into the com- merce of any country that is not an ATPDEA beneficiary country while en route to the United States and the in- voices, bills of lading, and other ship- ping documents show the United States as the final destination; or

(3) If the shipment is from any ATPDEA beneficiary country to the United States through the territory of any country that is not an ATPDEA beneficiary country, and the invoices and other documents do not show the United States as the final destination, the articles in the shipment upon ar-

rival in the United States are imported directly only if they:

(i) Remained under the control of the customs authority of the intermediate country;

(ii) Did not enter into the commerce of the intermediate country except for the purpose of sale other than at retail, and the port director is satisfied that the importation results from the origi- nal commercial transaction between the importer and the producer or the producer’s sales agent; and

(iii) Were not subjected to operations other than loading or unloading, and other activities necessary to preserve the articles in good condition.

(c) Country of origin criteria—(1) Gen- eral. Except as otherwise provided in paragraph (c)(2) of this section, an arti- cle described in paragraph (a)(2) of this section may be eligible for preferential treatment if the article is either:

(i) Wholly the growth, product, or manufacture of an ATPDEA bene- ficiary country; or

(ii) A new or different article of com- merce which has been grown, produced, or manufactured in an ATPDEA bene- ficiary country.

(2) Exceptions. No article will be eligi- ble for preferential treatment by virtue of having merely undergone simple (as opposed to complex or meaningful) combining or packaging operations, or mere dilution with water or mere dilu- tion with another substance that does not materially alter the characteristics of the article. The principles and exam- ples set forth in § 10.195(a)(2) will apply equally for purposes of this paragraph.

(d) Value content requirement—(1) Gen- eral. An article may be eligible for pref- erential treatment only if the sum of the cost or value of the materials pro- duced in an ATPDEA beneficiary coun- try or countries, plus the direct costs of processing operations performed in an ATPDEA beneficiary country or countries, is not less than 35 percent of the appraised value of the article at the time it is entered.

(2) Commonwealth of Puerto Rico, U.S. Virgin Islands and CBI beneficiary coun- tries. For the specific purpose of deter- mining the percentage referred to in paragraph (d)(1) of this section, the term ‘‘ATPDEA beneficiary country’’ includes the Commonwealth of Puerto

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00240 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

231

U.S. Customs and Border Protection, DHS; Treasury § 10.253

Rico, the U.S. Virgin Islands, and any CBI beneficiary country as defined in § 10.191(b)(1). Any cost or value of mate- rials or direct costs of processing oper- ations attributable to the Virgin Is- lands or any CBI beneficiary country must be included in the article prior to its final exportation to the United States from an ATPDEA beneficiary country as defined in § 10.252.

(3) Materials produced in the United States. For purposes of determining the percentage referred to in paragraph (d)(1) of this section, an amount not to exceed 15 percent of the appraised value of the article at the time it is en- tered may be attributed to the cost or value of materials produced in the cus- toms territory of the United States (other than the Commonwealth of Puerto Rico). The principles set forth in paragraph (d)(4)(i) of this section will apply in determining whether a material is ‘‘produced in the customs territory of the United States’’ for pur- poses of this paragraph.

(4) Cost or value of materials—(i) ‘‘Ma- terials produced in an ATPDEA bene- ficiary country or countries’’ defined. For purposes of paragraph (d)(1) of this sec- tion, the words ‘‘materials produced in an ATPDEA beneficiary country or countries’’ refer to those materials in- corporated in an article which are ei- ther:

(A) Wholly the growth, product, or manufacture of an ATPDEA bene- ficiary country or two or more ATPDEA beneficiary countries; or

(B) Substantially transformed in any ATPDEA beneficiary country or two or more ATPDEA beneficiary countries into a new or different article of com- merce which is then used in any ATPDEA beneficiary country as de- fined in § 10.252 in the production or manufacture of a new or different arti- cle which is imported directly into the United States. For purposes of this paragraph (d)(4)(i)(B), no material will be considered to be substantially trans- formed into a new or different article of commerce by virtue of having mere- ly undergone simple (as opposed to complex or meaningful) combining or packaging operations, or mere dilution with water or mere dilution with an- other substance that does not materi- ally alter the characteristics of the ar-

ticle. The examples set forth in § 10.196(a), and the principles and exam- ples set forth in § 10.195(a)(2), will apply for purposes of the corresponding con- text under paragraph (d)(4)(i) of this section.

(ii) Failure to establish origin. If the importer fails to maintain adequate records to establish the origin of a ma- terial, that material may not be con- sidered to have been grown, produced, or manufactured in an ATPDEA bene- ficiary country or in the customs terri- tory of the United States for purposes of determining the percentage referred to in paragraph (d)(1) of this section.

(iii) Determination of cost or value of materials. (A) The cost or value of ma- terials produced in an ATPDEA bene- ficiary country or countries or in the customs territory of the United States includes:

(1) The manufacturer’s actual cost for the materials;

(2) When not included in the manu- facturer’s actual cost for the materials, the freight, insurance, packing, and all other costs incurred in transporting the materials to the manufacturer’s plant;

(3) The actual cost of waste or spoil- age, less the value of recoverable scrap; and

(4) Taxes and/or duties imposed on the materials by any ATPDEA bene- ficiary country or by the United States, provided they are not remitted upon exportation.

(B) Where a material is provided to the manufacturer without charge, or at less than fair market value, its cost or value will be determined by computing the sum of:

(1) All expenses incurred in the growth, production, or manufacture of the material, including general ex- penses;

(2) An amount for profit; and (3) Freight, insurance, packing, and

all other costs incurred in transporting the material to the manufacturer’s plant.

(5) Direct costs of processing oper- ations—(i) Items included. For purposes of paragraph (d)(1) of this section, the

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00241 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

232

19 CFR Ch. I (4–1–12 Edition)§ 10.254

words ‘‘direct costs of processing oper- ations’’ mean those costs either di- rectly incurred in, or which can be rea- sonably allocated to, the growth, pro- duction, manufacture, or assembly of the specific merchandise under consid- eration. Those costs include, but are not limited to the following, to the ex- tent that they are includable in the ap- praised value of the imported merchan- dise:

(A) All actual labor costs involved in the growth, production, manufacture, or assembly of the specific merchan- dise, including fringe benefits, on-the- job training, and the cost of engineer- ing, supervisory, quality control, and similar personnel;

(B) Dies, molds, tooling, and depre- ciation on machinery and equipment which are allocable to the specific mer- chandise;

(C) Research, development, design, engineering, and blueprint costs inso- far as they are allocable to the specific merchandise; and

(D) Costs of inspecting and testing the specific merchandise.

(ii) Items not included. For purposes of paragraph (d)(1) of this section, the words ‘‘direct costs of processing oper- ations’’ do not include items which are not directly attributable to the mer- chandise under consideration or are not costs of manufacturing the prod- uct. These include, but are not limited to:

(A) Profit; and (B) General expenses of doing busi-

ness which either are not allocable to the specific merchandise or are not re- lated to the growth, production, manu- facture, or assembly of the merchan- dise, such as administrative salaries, casualty and liability insurance, adver- tising, and salesmen’s salaries, com- missions, or expenses.

(6) Articles wholly the growth, product, or manufacture of an ATPDEA bene- ficiary country. Any article which is wholly the growth, product, or manu- facture of an ATPDEA beneficiary country as defined in § 10.252, and any article produced or manufactured in an ATPDEA beneficiary country as de- fined in § 10.252 exclusively from mate- rials which are wholly the growth, product, or manufacture of an ATPDEA beneficiary country or coun-

tries, will normally be presumed to meet the requirement set forth in para- graph (d)(1) of this section.

§ 10.254 Certificate of Origin. A Certificate of Origin as specified in

§ 10.256 must be employed to certify that an article described in § 10.253(a) being exported from an ATPDEA bene- ficiary country to the United States qualifies for the preferential treatment referred to in § 10.251. The Certificate of Origin must be prepared in the ATPDEA beneficiary country by the producer or exporter or by the pro- ducer’s or exporter’s authorized agent. If the person preparing the Certificate of Origin is not the producer of the ar- ticle, the person may complete and sign a Certificate on the basis of:

(a) The person’s reasonable reliance on the producer’s written representa- tion that the article qualifies for pref- erential treatment; or

(b) A completed and signed Certifi- cate of Origin for the article volun- tarily provided to the person by the producer.

[CBP Dec. 06–21, 71 FR 44583, Aug. 7, 2006]

§ 10.255 Filing of claim for preferential treatment.

(a) Declaration. In connection with a claim for preferential treatment for an article described in § 10.253(a), the im- porter must make a written declara- tion that the article qualifies for that treatment. The written declaration should be made by including on the entry summary, or equivalent docu- mentation, the symbol ‘‘J+’’ as a prefix to the subheading of the HTSUS in which the article in question is classi- fied. Except in any of the cir- cumstances described in § 10.256(d)(1), the declaration required under this paragraph must be based on a complete and properly executed original Certifi- cate of Origin that covers the article being imported and that is in the pos- session of the importer.

(b) Corrected declaration. If, after making the declaration required under paragraph (a) of this section, the im- porter has reason to believe that a Cer- tificate of Origin on which a declara- tion was based contains information that is not correct, the importer must within 30 calendar days after the date

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00242 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

233

U.S. Customs and Border Protection, DHS; Treasury § 10.256

of discovery of the error make a cor- rected declaration and pay any duties that may be due. A corrected declara- tion will be effected by submission of a letter or other written statement to the Customs port where the declara- tion was originally filed.

§ 10.256 Maintenance of records and submission of Certificate by im- porter.

(a) Maintenance of records. Each im- porter claiming preferential treatment for an article under § 10.255 must main- tain in the United States, in accord- ance with the provisions of part 163 of this chapter, all records relating to the importation of the article. Those records must include the original Cer- tificate of Origin referred to in § 10.255(a) and any other relevant docu- ments or other records as specified in § 163.1(a) of this chapter.

(b) Submission of Certificate. An im- porter who claims preferential treat- ment on an article under § 10.255(a) must provide, at the request of the port director, a copy of the Certificate of Origin pertaining to the article. A Cer- tificate of Origin submitted to Customs under this paragraph:

(1) Must be on CBP Form 449, includ- ing privately-printed copies of that Form, or, as an alternative to CBP Form 449, in an approved computerized format or other medium or format as is approved by the Office of International Trade, U.S. Customs and Border Pro- tection, Washington, DC 20229. An al- ternative format must contain the same information and certification set forth on CBP Form 449;

(2) Must be signed by the producer or exporter or by the producer’s or export- er’s authorized agent having knowledge of the relevant facts;

(3) Must be completed either in the English language or in the language of the country from which the article is exported. If the Certificate is com- pleted in a language other than English, the importer must provide to Customs upon request a written English translation of the Certificate; and

(4) May be applicable to: (i) A single importation of an article

into the United States, including a sin- gle shipment that results in the filing

of one or more entries and a series of shipments that results in the filing of one entry; or

(ii) Multiple importations of iden- tical articles into the United States that occur within a specified blanket period, not to exceed 12 months, set out in the Certificate by the exporter. For purposes of this paragraph, ‘‘identical articles’’ means articles that are the same in all material respects, includ- ing physical characteristics, quality, and reputation.

(c) Correction and nonacceptance of Certificate. If the port director deter- mines that a Certificate of Origin is il- legible or defective or has not been completed in accordance with para- graph (b) of this section, the importer will be given a period of not less than five working days to submit a cor- rected Certificate. A Certificate will not be accepted in connection with sub- sequent importations during a period referred to in paragraph (b)(4)(ii) of this section if the port director deter- mined that a previously imported iden- tical article covered by the Certificate did not qualify for preferential treat- ment.

(d) Certificate not required—(1) Gen- eral. Except as otherwise provided in paragraph (d)(2) of this section, an im- porter is not required to have a Certifi- cate of Origin in his possession for:

(i) An importation of an article for which the port director has in writing waived the requirement for a Certifi- cate of Origin because the port director is otherwise satisfied that the article qualifies for preferential treatment;

(ii) A non-commercial importation of an article; or

(iii) A commercial importation of an article whose value does not exceed US$2,500, provided that, unless waived by the port director, the producer, ex- porter, importer or authorized agent includes on, or attaches to, the invoice or other document accompanying the shipment the following signed state- ment:

I hereby certify that the article covered by this shipment qualifies for preferential tariff treatment under the ATPDEA.

Check One:

( ) Producer ( ) Exporter ( ) Importer

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00243 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

234

19 CFR Ch. I (4–1–12 Edition)§ 10.257

( ) Agent lllllllllllllllll

Name lllllllllllllllll

Title lllllllllllllllll

Address lllllllllllllllll

Signature and Date

(2) Exception. If the port director de- termines that an importation described in paragraph (d)(1) of this section forms part of a series of importations that may reasonably be considered to have been undertaken or arranged for the purpose of avoiding a Certificate of Or- igin requirement under §§ 10.254 through 10.256, the port director will notify the importer in writing that for that importation the importer must have in his possession a valid Certifi- cate of Origin to support the claim for preferential treatment. The importer will have 30 calendar days from the date of the written notice to obtain a valid Certificate of Origin, and a fail- ure to timely obtain the Certificate of Origin will result in denial of the claim for preferential treatment. For pur- poses of this paragraph, a ‘‘series of im- portations’’ means two or more entries covering articles arriving on the same day from the same exporter and con- signed to the same person.

[T.D. 03–16, 68 FR 14497, Mar. 25, 2003; 68 FR 67349, Dec. 1, 2003, as amended by CBP Dec. 06–21, 71 FR 44583, Aug. 7, 2006]

§ 10.257 Verification and justification of claim for preferential treatment.

(a) Verification by Customs. A claim for preferential treatment made under § 10.255, including any statements or other information contained on a Cer- tificate of Origin submitted to Customs under § 10.256, will be subject to what- ever verification the port director deems necessary. In the event that the port director for any reason is pre- vented from verifying the claim, the port director may deny the claim for preferential treatment. A verification of a claim for preferential treatment may involve, but need not be limited to, a review of:

(1) All records required to be made, kept, and made available to Customs by the importer or any other person under part 163 of this chapter;

(2) Documentation and other infor- mation regarding the country of origin of an article and its constituent mate- rials, including, but not limited to, production records, information relat- ing to the place of production, the number and identification of the types of machinery used in production, and the number of workers employed in production; and

(3) Evidence to document the use of U.S. or ATPDEA beneficiary country materials in the production of the arti- cle in question, such as purchase or- ders, invoices, bills of lading and other shipping documents, and customs im- port and clearance documents.

(b) Importer requirements. In order to make a claim for preferential treat- ment under § 10.255, the importer:

(1) Must have records that explain how the importer came to the conclu- sion that the article qualifies for pref- erential treatment. Those records must include documents that support a claim that the article in question qualifies for preferential treatment be- cause it meets the country of origin and value content requirements set forth in § 10.253(c) and (d). A properly completed Certificate of Origin in the form prescribed in § 10.254(b) is a record that would serve this purpose;

(2) Must establish and implement in- ternal controls which provide for the periodic review of the accuracy of the Certificate of Origin or other records referred to in paragraph (b)(1) of this section;

(3) Must have shipping papers that show how the article moved from the ATPDEA beneficiary country to the United States. If the imported article was shipped through a country other than an ATPDEA beneficiary country and the invoices and other documents from the ATPDEA beneficiary country do not show the United States as the final destination, the importer also must have documentation that dem- onstrates that the conditions set forth in § 10.253(b)(3)(i) through (iii) were met; and

(4) Must be prepared to explain, upon request from Customs, how the records and internal controls referred to in paragraphs (b)(1) through (b)(3) of this section justify the importer’s claim for preferential treatment.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00244 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

235

U.S. Customs and Border Protection, DHS; Treasury § 10.303

Subpart G—United States-Canada Free Trade Agreement

SOURCE: Sections 10.301 through 10.311 issued by T.D. 89–3, 53 FR 51766, Dec. 23, 1988, unless otherwise noted.

§ 10.301 Scope and applicability.

The provisions of §§ 10.302 through 10.311 of this part relate to the proce- dures for obtaining duty preferences on imported goods under the United States-Canada Free-Trade Agreement (the Agreement) entered into on Janu- ary 2, 1988, and the United States-Can- ada Free-Trade Agreement Implemen- tation Act of 1988 (102 Stat. 1851). The United States and Canada agreed to suspend operation of the Agreement with effect from January 1, 1994, to co- incide with the entry into force of the North American Free Trade Agreement (see part 181 of this chapter) and, ac- cordingly, the provisions of §§ 10.302 through 10.311 of this part apply only to goods imported from Canada that were entered for consumption, or with- drawn from warehouse for consump- tion, during the period January 1, 1989, through December 31, 1993. In situa- tions involving goods subject to bilat- eral restrictions or prohibitions, or country of origin marking, other cri- teria for determining origin may be ap- plicable pursuant to Article 407 of the Agreement.

[T.D. 96–35, 61 FR 19835, May 3, 1996]

§ 10.302 Eligibility criteria in general.

Subject to the more specific expla- nations of the criteria in §§ 10.303 and 10.305 of this part, goods classifiable under an HTSUS heading or sub- heading for which the symbol ‘‘CA’’ ap- pears in the ‘‘special’’ column are eligi- ble for a preference if:

(a) Originating goods. The goods origi- nate in Canada or the United States, or both, and

(b) Direct shipment required. Except as provided in § 10.306(b), are directly shipped to the United States from Can- ada.

§ 10.303 Originating goods.

(a) General. For purposes of eligi- bility for a preference under the Agree-

ment, goods may be regarded as origi- nating goods if:

(1) Wholly of Canadian or United States origin. The goods are wholly obtained or produced in the Territory of Canada or the United States, or both, as set forth in General Note 3(c), HTSUS;

(2) Transformed with a change in classi- fication. The goods have been trans- formed by a processing which results in a change in classification and, if re- quired, a sufficient value-content, as set forth in General Note 3(c), HTSUS; or

(3) Transformed without a change in classification. An assembly of goods, other than goods of chapters 61 to 63 of the HTSUS, which does not result in a change in classification because the goods were imported in an unassembled or disassembled form and classified as the goods, unassembled or disassem- bled, pursuant to General Rule of In- terpretation 2(a), HTSUS, or because the tariff subheading for the goods pro- vides for both the goods themselves and their parts, shall nonetheless be treated as originating goods if:

(i) The value of originating materials and the direct cost of assembling in Canada or the United States, or both, as defined in § 10.305 constitute not less than 50 percent of the value of the goods when exported to the United States;

(ii) The assembled goods are not sub- sequently processed or further assem- bled in a third country; and

(iii) The goods satisfy the require- ment in § 10.306.

(b) Originating materials. For purposes of this section and § 10.305, the term ‘‘materials’’ means goods, other than those included as part of the direct cost of processing or assembling, used or consumed in the production of other goods, and the term ‘‘orginating’’ when used with reference to such materials means that the materials satisfy one of the criteria for originating goods set forth in paragraph (a) of this section.

(c) Change in classification. For pur- poses of paragraph (a) of this section, the expression ‘‘change in classifica- tion’’ means a change of classification within the Harmonized Commodity De- scription and Coding System (Har- monized System) as published and

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00245 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

236

19 CFR Ch. I (4–1–12 Edition)§ 10.304

amended from time to time by the Cus- toms Cooperation Council.

(d) Articles of feather. The goods are eligible to be treated as originating in Canada pursuant to General Note 3(c)(vii)(R)(12)(ee), HTSUS.

[T.D. 92–8, 57 FR 2453, Jan. 22, 1992]

§ 10.304 Exclusions. (a) Changes based on simple processing.

No goods shall be considered origi- nating for purposes of eligibility under the Agreement if they have merely un- dergone simple packaging or simple combining operations, or have under- gone mere dilution with water or with another substance that does not mate- rially alter the characteristics of the goods.

(b) Other excluded processing. No goods shall be considered to be origi- nating merely by virtue of having un- dergone any process or work in which the facts clearly justify the presump- tion that the sole object was to cir- cumvent the provisions of Chapter 3 of the Agreement.

§ 10.305 Value content requirement. (a) Direct cost of processing or assem-

bling—(1) Definition. For purposes of ap- plying a specific rule of origin under the Agreement which requires a value content determination, the terms ‘‘di- rect cost of processing’’ and ‘‘direct cost of assembling’’ mean the costs di- rectly incurred in, or that can be rea- sonably allocated to, the production of goods, including:

(i) The cost of all labor, including benefits and on-the-job training, labor provided in connection with super- vision, quality control, shipping, re- ceiving, storage, packaging, manage- ment at the location of the process or assembly, and other like labor, wheth- er provided by employees or inde- pendent contractors;

(ii) The cost of inspecting and testing the goods;

(iii) The cost of energy, fuel, dies, molds, tooling, and the depreciation and maintenance of machinery and equipment, without regard to whether they originate within the territory of the United States or Canada;

(iv) Development, design, and engi- neering costs;

(v) Rent, mortgage interest, deprecia- tion on buildings, property insurance premiums, maintenance, taxes and the cost of utilities for real property used in the production of the goods; and

(vi) Royalty, licensing, or other like payments for the right to the goods.

(2) Exclusions from direct costs of proc- essing or assembling. Excluded from the direct costs of processing or assembling are:

(i) Costs relating to the general ex- pense of doing business, such as the cost of providing executive, financial, sales, advertising, marketing, account- ing and legal services, and insurance;

(ii) Brokerage charges relating to the importation and exportation of goods;

(iii) Costs for telephone, mail, and other means of communication;

(iv) Packing costs for exporting the goods;

(v) Royalty payments related to a li- censing agreement to distribute or sell the goods;

(vi) Rent, mortgage interest, depre- ciation on buildings, property insur- ance premiums, maintenance, taxes, and the cost of utilities for real prop- erty used by personnel charged with administrative functions; and

(vii) Profit on the goods. (3) Interpretation—(i) Indirect mate-

rials. Under the definition of ‘‘mate- rials’’ set forth in § 10.303(b), certain types of materials are treated as direct costs of processing or assembling under paragraph (a) of this section. This ap- plies principally to materials used or consumed indirectly in the production of exported goods, where no portion of those materials is physically incor- porated in the exported goods. In addi- tion to the items specified in paragraph (a)(1)(iii) of this section, such mate- rials include items such as gloves and safety glasses worn by production workers, tape used in painting proc- esses, and tools, materials and spare parts used in the repair and mainte- nance of machinery and equipment used in the production of the exported goods. Such materials are to be distin- guished from waste and spoilage speci- fied in paragraph (b)(1)(ii)(C) of this section, which relate to materials that are physically incorporated in the ex- ported goods.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00246 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

237

U.S. Customs and Border Protection, DHS; Treasury § 10.305

(ii) Directly incurred. In order for costs incurred by a production facility to be treated as direct costs of proc- essing or assembling, those costs must be directly incurred in the production of the exported goods and not merely associated with the production facility as peripheral costs necessary to oper- ate the facility. In addition to the ex- clusions set forth in paragraph (a)(2) of this section, such peripheral costs in- clude labor costs for nurses tending to employees, for accounting personnel involved in physical inventory taking, for personnel responsible for pur- chasing or requisitioning materials to be used or consumed in the production process, and for second level super- visors and above who are not directly involved in the production process.

(iii) Labor costs. Under paragraph (a)(1)(i) of this section, labor costs in- cludable as direct costs of processing or assembling are limited to labor pro- vided by the producer’s employees or by independent contractors. Thus, for example, where processing operations are performed on components in the United States and those components are sold to a manufacturer in Canada where they are incorporated in goods exported to the United States, the cost of those processing operations in the United States cannot be separately counted as a direct cost of processing attributable to the finished goods ex- ported to the United States.

(iv) Interest expense. Bona fide inter- est payments on debt of any form, se- cured or unsecured, undertaken on arm’s length terms in the ordinary course of business to finance the acqui- sition of fixed assets such as real prop- erty, a plant, and/or equipment used in the production of goods in the territory of Canada or the U.S. are includable in the direct cost of processing or direct cost of assembling. Interest will be treated as a direct cost of processing or assembling, but only that portion of the interest which is related to a fixed asset directly used in the production of the goods exported; thus, where an en- tire production facility is covered by a mortgage and incorporates both pro- duction and administrative or other general expense space, an appropriate allocation must be made in order to en- sure that only that portion of the in-

terest allocated to the production area is counted toward the value-content re- quirement. Interest expenses attrib- utable to general and administrative costs or expenses, including interest on funds borrowed to meet the payroll of personnel directly involved in the pro- duction of goods, are not considered di- rect costs of processing or assembly.

(b) Value of originating materials—(1) Definition. The term ‘‘value of mate- rials originating in the United States or Canada or both’’ means the aggre- gate of:

(i) The price paid by the producer of exported goods for materials origi- nating in either the United States or Canada, or both, or for materials im- ported from a third country used or consumed in the production of such originating materials; and

(ii) When not included in that price, the following costs related thereto:

(A) Freight, insurance, packing and all other costs incurred in transporting any of the materials referred to in paragraph (b)(1)(i) of this section to the location of the producer;

(B) Duties, taxes and brokerage fees on such materials paid in the United States, or Canada, or both;

(C) The cost of waste or spoilage re- sulting from the use or consumption of such materials, less the value of renew- able scrap or by-product; and

(D) The value of goods and services relating to such materials determined in accordance with subparagraph 1(b) of Article 8 of the Agreement on Imple- mentation of Article VII of the General Agreement on Tariffs and Trade.

(2) Directly attributable. Whenever a value-content determination is re- quired by the rules of the Agreement and whenever originating materials and materials obtained or produced in a third country are used or consumed together in the production of goods in the United States or Canada, the value of originating materials may be treat- ed as such only to the extent that the value is directly attributable to the goods under consideration.

(3) Interpretation. (i) Price paid. As provided in paragraph (b)(1) of this sec- tion, the ‘‘price paid’’ for materials by the producer of exported goods forms the basis for determining the value of such materials when incorporated in

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00247 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

238

19 CFR Ch. I (4–1–12 Edition)§ 10.305

the exported goods. The actual price paid for such materials will determine the value of those materials for pur- poses of the value-content require- ment, even though a relationship be- tween the producer and the seller of the materials may have influenced the price, except where the price did not include items specified in paragraph (b)(1)(ii) of this section that relate to the materials. The following examples will illustrate these principles. Not- withstanding these examples, the to- tality of the facts must be examined in each case to determine whether § 10.304(b) is applicable.

Example 1. Non-originating materials are sold by Company X (a foreign corporation lo- cated outside the United States or Canada) to Company Y (a Canadian corporation) for $100; Company X also sold identical mate- rials to Company Z (a U.S. corporation) for $200 which was the price Company Z had paid to Company X for similar materials prior to implementation of the Agreement; and those non-originating materials sold by Company X to Company Y are then incorporated by Company Y into goods exported to the United States. In this case the $100 price paid by Company Y to Company X constitutes the value of those materials for purposes of the value-content requirement.

Example 2. Company X purchased materials for $100, added a four percent mark-up to the price paid to defray purchasing expenses, and then sold the marked-up materials to Com- pany Y (a Canadian corporation) which in- corporated the materials in goods exported to the United States. In this case the $104 price paid by Company Y to Company X con- stitutes the value of the materials for pur- poses of the value-content requirement.

Example 3. Company X (a foreign corpora- tion located outside the United States) sold non-originating materials to Company Y (a U.S. corporation) for $200, and Company Y then sold those materials for $100 to Com- pany Z (a Canadian corporation) which in- corporated the materials in goods which were imported into the United States by Company P (the U.S. parent company of Company Y). In this case, in accordance with paragraph (b)(1)(ii)(D) of this section, $100 would be added to the price paid by Company Z for purposes of the value-content require- ment because the materials were sold at a reduced cost within the meaning of subpara- graph 1(b) of Article 8 of the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade.

(ii) Originating materials for which no price paid. In cases involving a vertically integrated producer (that is,

an entity which produces goods for ex- port from materials which that pro- ducer has also made) a ‘‘price paid’’ for such originating materials normally does not exist. Even in the absence of a ‘‘price paid’’, such a vertically inte- grated producer may still claim the materials as originating materials for purposes of qualifying the finished goods exported to the United States as goods originating in Canada. However, under paragraph (b)(1)(i) of this section the value of those materials for pur- poses of applying the value-content re- quirement is limited to the price paid for those materials imported from the third country plus any costs added thereto under paragraph (b)(1)(ii) of this section. The following examples will illustrate these principles.

Example 1. If an automobile producer in the United States or Canada fabricates body pan- els wholly from third country steel coil, those body panels can qualify as originating materials without having to satisfy a value- content requirement because steel coil is classified in chapter 72 of the Harmonized System and body panels are classified in chapter 87 and the change in classification rules in chapter 87 do not incorporate a value-content requirement in this context. Thus, the producer can claim the body pan- els fabricated from the third country steel as originating materials for purposes of the value-content requirement applicable to the finished automobile which will be exported to the United States. The value of those originating materials is the price paid for the steel coil imported from the third coun- try and used or consumed in the production of the body panels.

Example 2. An automobile exporter in Can- ada purchases and imports body panels fab- ricated in a third country in order to join them with vertically (locally) fabricated body panels to form an automobile body. If the body qualifies as an originating mate- rial, the exporter has two options. Under the first option, the exporter can claim the body as originating material, in which case the value of originating material is the price paid for the foreign body panels. Under the second option, the exporter may elect not to claim the body as originating material; but, rather, the exporter may claim as origi- nating material any domestic steel coil used in producing the vertically (locally) fab- ricated body panels, in which case the value of originating material is the price paid for the domestic steel coil.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00248 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

239

U.S. Customs and Border Protection, DHS; Treasury § 10.307

(c) Value of goods when exported. The term ‘‘value of the goods when ex- ported to the United States’’ means the aggregate of:

(1) The price paid by the producer for all materials, whether or not the mate- rials originate in the United States, or Canada, or both, and, when not in- cluded in the price paid for the mate- rials, the following costs related there- to:

(i) Freight, insurance, packing, and all other costs incurred in transporting all materials to the location of the pro- ducer;

(ii) Duties, taxes, and brokerage fees on all materials paid in the United States, or Canada, or both;

(iii) The cost of waste or spoilage re- sulting from the use or consumption of such materials, less the value of renew- able scrap or by-product; and

(iv) The value of goods and services relating to all materials determined in accordance with subparagraph 1(b) of Article 8 of the Agreement on Imple- mentation of Article VII of the General Agreement on Tariffs Trade; and

(2) The direct cost of processing or the direct cost of assembling the goods.

[T.D. 92–8, 57 FR 2453, Jan. 22, 1992; 57 FR 4793, Feb. 7, 1992, as amended by T.D. 92–98, 57 FR 46504, Oct. 9, 1992]

§ 10.306 Direct shipment to the United States.

Goods shall be considered as directly shipped to the United States from Can- ada for the purpose of eligibility for preferences under the Agreement only under the following circumstances:

(a) Through shipment. The goods have been shipped directly from Canada to the United States without passage through the territory of any third country; or

(b) Shipment through a third country. The goods were shipped through the territory of a third country but:

(1) The goods did not enter the com- merce of any third country;

(2) The goods did not undergo any op- eration other than unloading, reload- ing, or any operation necessary to transport them to the United States or to preserve them in good condition; and

(3) All shipping and export docu- ments show the United States as the final destination.

§ 10.307 Documentation. (a) Claims for a preference. A pref-

erence in accordance with the Agree- ment may be claimed by including on the entry summary, or equivalent doc- umentation, the symbol ‘‘CA’’ as a pre- fix to the subheading of the HTSUS under which each eligible good is clas- sified.

(b) Failure to claim a preference. Fail- ure to make a timely claim for a pref- erence under the Agreement will result in liquidation at the rate which would otherwise be applicable.

(c) Documentation showing origin. A claim for a preference under the Agree- ment shall be based on the Exporter’s Certificate of Origin, properly com- pleted and signed by the person who ex- ports or knowingly causes the goods to be exported from Canada. The Export- er’s Certificate of Origin must be avail- able at the time the preference is claimed and shall be presented to the port director upon request.

(d) Exporter’s Certificate of Origin—(1) General. The Exporter’s Certificate of Origin shall be prepared on Customs Form 353. In lieu of the Customs Form 353, the exporter may use an approved computerized format or such other for- mat as is approved by the Head- quarters, U.S. Customs Service, Office of Trade Operations, Washington, DC 20229. Alternative formats must con- tain the same information and certifi- cation set forth on Customs Form 353.

(2) Blanket certifications. A blanket Exporter’s Certificate of Origin, not to exceed a period of 12 months, issued for goods claimed as originating goods under the Agreement, can only be used if the certifying exporter is able to verify that the goods in each shipment to be covered by the blanket certifi- cation actually qualify for treatment under the Agreement. A blanket cer- tification does not allow an exporter to average its costs over the blanket cer- tification period in order to establish that the exported goods meet the cri- teria for originating goods under the Agreement. Under § 10.308, the exporter must retain supporting records that will permit a review of the eligibility

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00249 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

240

19 CFR Ch. I (4–1–12 Edition)§ 10.308

of the goods in each shipment covered by a blanket certification.

(e) Exceptions to documentation re- quirements. Exceptions to the foregoing documentation requirements may be authorized at the discretion of the port director in the following cir- cumstances:

(1) Exception for informal entries. As set forth in paragraphs (e)(1) (i) and (ii) of this section, an Exporter’s Certifi- cate of Origin may be waived in con- nection with an entry entitled to infor- mal entry procedures as authorized in §§ 143.21 and 143.22 of this chapter if:

(i) Commercial goods which qualify for informal entry. The invoice, or an ap- propriate Customs release document, for commercial goods which qualify both for informal entry and a pref- erence must include the following statement, on the invoice or appro- priate Customs document:

I hereby certify that the goods described herein are eligible for a preference based upon the rules of origin enumerated in the United States-Canada Free-Trade Agree- ment.

Check One:

( ) Manufacturer ( ) Supplier ( ) Exporter llllllllllllllllllllllll

Signature llllllllllllllllllllllll

Title Date: llllllllllllllllllll

(ii) Noncommercial goods which qualify for informal entry. The importation of goods from Canada by a person for non- commercial use may be exempt from documentation requirements if the goods are legally marked ‘‘Made in Canada’’, or it can otherwise be shown that they are originating goods under the Agreement and there is no evidence to the contrary.

(2) Waiver of evidence of direct ship- ment. The port director may waive the submission of evidence of direct ship- ment when otherwise satisfied, taking into consideration the kind and value of the goods, that the goods were, in fact, imported directly from Canada, and that they otherwise qualify for a

preference in accordance with the Agreement.

[T.D. 89–3, 53 FR 51766, Dec. 23, 1988, as amended by T.D. 92–8, 57 FR 2455, Jan. 22, 1992]

§ 10.308 Records retention. (a) Importer. The importer of record

shall retain the exporter’s certificate of origin required by § 10.307(d) for a pe- riod of 5 years and it must be made available upon request by the appro- priate Customs official.

(b) Exporter. Any person who exports, or who knowlingly causes to be ex- ported, any merchandise to Canada shall make, keep, and render for exam- ination and inspection, such records (including certifications of origin or copies thereof), which pertain to such exportation for a period of 5 years from the date of exportation. In the event that the appropriate Customs official requests submission of the records, they shall be submitted directly to the requesting official.

§ 10.309 Verification of documentation. Any evidence of country of origin or

of direct shipment submitted in sup- port of a preference under the Agree- ment shall be subject to such verification as the appropriate Cus- toms official may deem necessary. If the U.S. importer or U.S. exporter or their agent does not provide the infor- mation requested by the appropriate Customs officer, the port director may refuse to grant the claim for pref- erence, in addition to other available sanctions.

§ 10.310 Election to average for motor vehicles.

(a) Election. In determining whether a motor vehicle is originating for pur- poses of the preferences under the Agreement or a Canadian article under the Automotive Products Trade Act of 1965 (APTA), a manufacturer may elect to average, over its 12-month financial year, its calculation of the value-con- tent requirement for vehicles of the same class or sister vehicles which are assembled in the same plant as pro- vided for in the Agreement. A manufac- turer must declare its election to aver- age before the importation of any vehi- cles produced within the identified 12-

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00250 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

241

U.S. Customs and Border Protection, DHS; Treasury § 10.401

month period. The election to average is subject to the conditions and re- quirements set forth in §§ 10.310 and 10.311.

(b) Effect of election. An election to average shall be binding at the time of the first entry of vehicles for which the election has been made and shall re- main binding for the plant for the en- tire period covered by the election. If a manufacturer’s annual report, required by § 10.311, does not verify the claim that the vehicles are originating goods under the Agreement or Canadian arti- cles under APTA, or if a manufacturer otherwise fails to comply with the re- porting requirements, entries of the ve- hicles identified in the averaging dec- laration will be subject to liquidation in accordance with the rate of duty which would otherwise apply.

(c) Election in lieu of certificate of ori- gin. In lieu of the Exporter’s Certificate of Origin required in § 10.307(c), an im- porter of vehicles covered by an elec- tion to average under this section may have its claim for preference based on a copy of the declaration of election.

[T.D. 89–3, 53 FR 51766, Dec. 23, 1988, as amended by T.D. 92–8, 57 FR 2455, Jan. 22, 1992]

§ 10.311 Documentation for election to average for motor vehicles.

A manufacturer who elects to aver- age for motor vehicles shall submit a declaration of election to average, quarterly reports, and an annual report in the form and manner as follows:

(a) Declaration of election. A declara- tion of election to average, signed by an authorized company official, shall be submitted by the manufacturer to the U.S. Customs and Border Protec- tion, Office of International Trade, Regulatory Audit, Detroit, Michigan 48226–2568 on CBP Form 355, Declara- tion of Election to Average.

(b) Quarterly Report. A quarterly re- port shall be submitted to the Office of International Trade, Regulatory Audit, at the above address, on CBP Form 356, Vehicle Cost Report (Quarterly), with- in 30 days after the end of each quarter. In lieu of the CBP Form 356, the manu- facturer may submit the information required on the form in an approved computerized format or such other for- mat as is approved by the U.S. Customs

and Border Protection, Office of Inter- national Trade, Regulatory Audit, De- troit, Michigan 48226–2568. Alternative formats must contain the same infor- mation set forth on the CBP Form 356. Negative quarterly reports are re- quired.

(c) Annual Report. An annual report shall be submitted to the U.S. Customs and Border Protection, Office of Inter- national Trade, Regulatory Audit, De- troit, Michigan 48226–2568, on CBP Form 357, Vehicle Cost Report (An- nual), within 90 days of the end of the financial year identified in the Elec- tion to Average, CBP Form 355. In lieu of the CBP Form 357, Vehicle Cost Re- port (Annual), the manufacturer may submit the information required on the form in an approved computerized for- mat or such other format as is ap- proved by the U.S. Customs and Border Protection, Office of International Trade, Regulatory Audit, Detroit, Michigan 48226–2568. Alternative for- mats must contain the same informa- tion set forth on CBP Form 357.

Subpart H—United States-Chile Free Trade Agreement

SOURCE: CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, unless otherwise noted.

GENERAL PROVISIONS

§ 10.401 Scope.

This subpart implements the duty preference and related customs provi- sions applicable to imported goods under the United States-Chile Free Trade Agreement (the US-CFTA) signed on June 6, 2003, and under the United States-Chile Free Trade Agree- ment Implementation Act (the Act; 117 Stat. 909). Except as otherwise speci- fied in this subpart, the procedures and other requirements set forth in this subpart are in addition to the customs procedures and requirements of general application contained elsewhere in this chapter. Additional provisions imple- menting certain aspects of the US- CFTA and the Act are contained in parts 12, 24, 162, and 163 of this chapter.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76131, Dec. 20, 2006]

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00251 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

242

19 CFR Ch. I (4–1–12 Edition)§ 10.402

§ 10.402 General definitions.

As used in this subpart, the following terms will have the meanings indicated unless either the context in which they are used requires a different meaning or a different definition is prescribed for a particular section of this subpart:

(a) Certification. ‘‘Certification’’ means, either when used by itself or in the expression ‘‘certification of ori- gin’’, the certification established under article 4.13 of the US-CFTA, that a good qualifies as an originating good under the US-CFTA;

(b) Claim of origin. ‘‘Claim of origin’’ means a claim that a textile or apparel good is an originating good or a good of a Party;

(c) Claim for preferential tariff treat- ment. ‘‘Claim for preferential tariff treatment’’ means a claim that a good is entitled to the duty rate applicable under the US–CFTA and to an exemp- tion from the merchandise processing fee;

(d) Customs authority. ‘‘Customs au- thority’’ means the competent author- ity that is responsible under the law of a Party for the administration of cus- toms laws and regulations;

(e) Customs Valuation Agreement. ‘‘Customs Valuation Agreement’’ means the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994, which is part of the WTO Agreement;

(f) Days. ‘‘Days’’ means calendar days;

(g) Customs duty. ‘‘Customs duty’’ in- cludes any customs or import duty and a charge of any kind imposed in con- nection with the importation of a good, including any form of surtax or sur- charge in connection with such impor- tation, but, for purposes of imple- menting the US-CFTA, does not in- clude any:

(1) Charge equivalent to an internal tax imposed consistently with Article III:2 of the GATT 1994; in respect of like, directly competitive, or substitut- able goods of the Party, or in respect of goods from which the imported good has been manufactured or produced in whole or in part;

(2) Antidumping or countervailing duty; and

(3) Fee or other charge in connection with importation commensurate with the cost of services rendered;

(h) Enterprise. ‘‘Enterprise’’ means any entity constituted or organized under applicable law, whether or not for profit, and whether privately-owned or governmentally-owned, including any corporation, trust, partnership, sole proprietorship, joint venture, or other association;

(i) GATT 1994. ‘‘GATT 1994’’ means the General Agreement on Tariffs and Trade 1994, which is part of the WTO Agreement;

(j) Goods. ‘‘Goods’’ means domestic products as these are understood in the GATT 1994 or such goods as the Parties may agree, and includes originating goods of that Party. A good of a Party may include materials of other coun- tries;

(k) Harmonized System. ‘‘Harmonized System (HS)’’ means the Harmonized Commodity Description and Coding Sys- tem, including its General Rules of In- terpretation, Section Notes, and Chap- ter Notes, as adopted and implemented by the Parties in their respective tariff laws;

(l) Heading. ‘‘Heading’’ means the first four digits in the tariff classifica- tion number under the Harmonized System;

(m) HTSUS. ‘‘HTSUS’’ means the Harmonized Tariff Schedule of the United States as promulgated by the U.S. International Trade Commission;

(n) Identical goods. ‘‘Identical goods’’ means goods that are the same in all respects relevant to the particular rule of origin that qualifies the goods as originating;

(o) Indirect material. ‘‘Indirect mate- rial’’ means a good used in the produc- tion, testing, or inspection of a good in the territory of the United States or Chile but not physically incorporated into the good, or a good used in the maintenance of buildings or the oper- ation of equipment associated with the production of a good in the territory of the United States or Chile, including—

(1) Fuel and energy; (2) Tools, dies, and molds; (3) Spare parts and materials used in

the maintenance of equipment and buildings;

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00252 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

243

U.S. Customs and Border Protection, DHS; Treasury § 10.410

(4) Lubricants, greases, compounding materials, and other materials used in production or used to operate equip- ment and buildings;

(5) Gloves, glasses, footwear, cloth- ing, safety equipment, and supplies;

(6) Equipment, devices, and supplies used for testing or inspecting the goods;

(7) Catalysts and solvents; and (8) Any other goods that are not in-

corporated into the good but whose use in the production of the good can rea- sonably be demonstrated to be a part of that production;

(p) Originating. ‘‘Originating’’ means qualifying under the rules of origin set out in Chapter Four (Rules of Origin and Origin Procedures) of the US- CFTA;

(q) Party. ‘‘Party’’ means the United States or the Republic of Chile;

(r) Person. ‘‘Person’’ means a natural person or an enterprise;

(s) Preferential tariff treatment. ‘‘Pref- erential tariff treatment’’ means the duty rate applicable to an originating good under the US–CFTA, and an ex- emption from the merchandise proc- essing fee.

(t) Subheading. ‘‘Subheading’’ means the first six digits in the tariff classi- fication number under the Harmonized System;

(u) Tariff preference level. ‘‘Tariff pref- erence level’’ means a quantitative limit for certain non-originating tex- tiles and textile apparel goods that may be entitled to preferential tariff treatment as if such goods were origi- nating based on the goods meeting the production requirements set forth in § 10.421 of this subpart.

(v) Textile or apparel good. ‘‘Textile or apparel good’’ means a good listed in the Annex to the Agreement on Tex- tiles and Clothing (commonly referred to as ATC), which is part of the WTO Agreement;

(w) Territory. ‘‘Territory’’ means: (1) With respect to Chile, the land,

maritime and air space under its sov- ereignty, and the exclusive economic zone and the continental shelf within which it exercises sovereign rights and jurisdiction in accordance with inter- national law and its domestic law; and

(2) With respect to the United States,

(i) The customs territory of the United States, which includes the 50 states, the District of Columbia, and Puerto Rico,

(ii) The foreign trade zones located in the United States and Puerto Rico, and

(iii) Any areas beyond the territorial seas of the United States within which, in accordance with international law and its domestic law, the United States may exercise rights with respect to the seabed and subsoil and their natural re- sources;

(x) WTO Agreement. ‘‘WTO Agree- ment’’ means the Marrakesh Agreement Establishing the World Trade Organiza- tion of April 15, 1994.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76131, Dec. 20, 2006]

IMPORT REQUIREMENTS

§ 10.410 Filing of claim for preferential tariff treatment upon importation.

(a) Declaration. In connection with a claim for preferential tariff treatment for an originating good under the US- CFTA, including an exemption from the merchandise processing fee, the U.S. importer must make a written declaration that the good qualifies for such treatment. The written declara- tion is made by including on the entry summary, or equivalent documenta- tion, the symbol ‘‘CL’’ as a prefix to the subheading of the HTSUS under which each qualifying good is classi- fied, or by the method specified for equivalent reporting via electronic interchange.

(b) Corrected declaration. If, after making the declaration required under paragraph (a) of this section, the U.S. importer has reason to believe that the declaration or the certification or other information on which the dec- laration was based contains informa- tion that is not correct, the importer must, within 30 calendar days after the date of discovery of the error, make a corrected declaration and pay any du- ties that may be due. A corrected dec- laration will be effected by submission of a letter or other statement either in writing or via an authorized electronic data interchange system to the CBP of- fice where the original declaration was

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00253 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

244

19 CFR Ch. I (4–1–12 Edition)§ 10.411

filed specifying the correction (see §§ 10.482 and 10.483 of this subpart).

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76131, Dec. 20, 2006]

§ 10.411 Certification of origin or other information.

(a) Contents. An importer who claims preferential tariff treatment on a good must submit, at the request of the port director, a certification of origin or other information demonstrating that the good qualifies as originating. A cer- tification or other information sub- mitted to CBP under this paragraph:

(1) Need not be in a prescribed format but must be in writing or must be transmitted electronically pursuant to any electronic means authorized by CBP for that purpose;

(2) Must include the following infor- mation:

(i) The legal name, address, tele- phone and e-mail address of the im- porter of record of the good (if known);

(ii) The legal name, address, tele- phone and e-mail address of the ex- porter of the good (if different from the producer);

(iii) The legal name, address, tele- phone and e-mail address of the pro- ducer of the good (if known);

(iv) A description of the good for which preferential tariff treatment is claimed, which must be sufficiently de- tailed to relate it to the invoice and the HS nomenclature;

(v) The HTSUS tariff classification, to six or more digits, as necessary for the specific change in tariff classifica- tion rule for the good set forth in Gen- eral Note 26(n), HTSUS;

(vi) The preference criterion as set forth in paragraph (f) of this section.

(b) Statement. A certification sub- mitted to CBP under paragraph (a) of this section must include a statement, in substantially the following form:

‘‘I Certify that: The information on this document is true

and accurate and I assume the responsibility for proving such representations. I under- stand that I am liable for any false state- ments or material omissions made on or in connection with this document;

I agree to maintain, and present upon re- quest, documentation necessary to support this certification, and to inform, in writing, all persons to whom the certification was

given of any changes that could affect the accuracy or validity of this certification; and

The goods originated in the territory of one or more of the parties, and comply with the origin requirements specified for those goods in the United States-Chile Free Trade Agreement; there has been no further pro- duction or any other operation outside the territories of the parties, other than unload- ing, reloading, or any other operation nec- essary to preserve it in good condition or to transport the good to the United States; and

This document consists of ll pages, in- cluding all attachments.’’

(c) Responsible official or agent. A cer- tification submitted under paragraph (a) of this section must be signed and dated by a responsible official of the importer; exporter; or producer; or by the importer’s, exporter’s, or pro- ducer’s authorized agent having knowl- edge of the relevant facts. The certifi- cation must include the legal name and address of the responsible official or authorized agent signing the certifi- cation, and should include that per- son’s telephone and e-mail address, if available. If the person making the cer- tification is not the producer of the good, or the producer’s authorized agent, the person may sign the certifi- cation of origin based on:

(1) A certification that the good qualifies as originating issued by the producer; or

(2) Knowledge of the exporter or im- porter that the good qualifies as an originating good.

(d) Language. The certification or other information submitted under paragraph (a) of this section must be completed either in the English or Spanish language. If the certification or other information is completed in Spanish, the importer must also pro- vide to the port director, upon request, a written English translation of the certification or other information.

(e) Applicability of certification. A cer- tification may be applicable to:

(1) A single importation of a good into the United States, including a sin- gle shipment that results in the filing of one or more entries and a series of shipments that results in the filing of one entry; or

(2) Multiple importations of identical goods into the United States that occur within a specified blanket period,

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00254 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

245

U.S. Customs and Border Protection, DHS; Treasury § 10.413

not exceeding 12 months. In the case of multiple shipments of identical goods, the certification must specify the blan- ket period in ‘‘mm/dd/yyyy to mm/dd/ yyyy’’ format.

(f) Preference criteria. The preference criterion to be included on the certifi- cation or other information as required in paragraph (a)(2)(vi) of this section is as follows:

(1) Preference criterion ‘‘A’’, refers to a good that is wholly obtained or pro- duced entirely in the territory of Chile or of the United States, or both (see General Note 26(b)(i), HTSUS);

(2) Preference criterion ‘‘B’’, refers to a good that is produced entirely in the territory of Chile or the United States, or both (see General Note 26(b)(ii), HTSUS), and

(i) Each of the non-originating mate- rials used in the production of the good undergoes an applicable change in tar- iff classification specified in General Note 26(n), HTSUS, or

(ii) The good otherwise satisfies any applicable regional value content or other requirements specified in Gen- eral Note 26(n), HTSUS;

(3) Preference criterion ‘‘C’’ refers to a good that is produced entirely in the territory of Chile or the United States, or both, exclusively from originating materials (see General Note 26(b)(iii), HTSUS).

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76132, Dec. 20, 2006; CBP Dec. 10–29, 75 FR 52450, Aug. 26, 2010]

§ 10.412 Importer obligations.

(a) General. An importer who makes a declaration under § 10.410(a) of this sub- part is responsible for the truthfulness of the declaration and of all the infor- mation and data contained in the cer- tification or other information sub- mitted to CBP under § 10.411(a) of this subpart, for submitting any supporting documents requested by CBP, and for the truthfulness of the information contained in those documents. CBP will allow for the direct submission by the exporter or producer of business confidential or other sensitive informa- tion, including cost and sourcing infor- mation.

(b) Compliance. In order to make a claim for preferential treatment under § 10.410 of this subpart, the importer:

(1) Must have records that explain how the importer came to the conclu- sion that the good qualifies for pref- erential tariff treatment. Those records must include documents that support a claim that the article in question qualifies for preferential tariff treatment because it meets the appli- cable rules of origin set forth in Gen- eral Note 26, HTSUS, and in this sub- part. Those records may include a properly completed certification or other information as set forth in § 10.411 of this subpart; and

(2) May be required to demonstrate that the conditions set forth in § 10.463 of this subpart were met if the im- ported article was shipped through an intermediate country.

(c) Information provided by exporter or producer. The fact that the importer has issued a certification based on in- formation provided by the exporter or producer will not relieve the importer of the responsibility referred to in paragraph (a) of this section. A U.S. importer who voluntarily makes a cor- rected declaration will not be subject to penalties for having made an incor- rect declaration (see § 10.481 of this sub- part).

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76132, Dec. 20, 2006]

§ 10.413 Validity of certification.

A certification that is completed, signed and dated in accordance with the requirements listed in § 10.411 of this subpart will be accepted by CBP as valid for four years from the date on which the certification was signed. If the port director determines that a cer- tification is illegible or defective or has not been completed in accordance with § 10.411 of this subpart, the im- porter will be given a period of not less than five business days to submit a corrected certification.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76132, Dec. 20, 2006]

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00255 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

246

19 CFR Ch. I (4–1–12 Edition)§ 10.414

§ 10.414 Certification or other informa- tion not required.

(a) General. Except as otherwise pro- vided in paragraph (b) of this section, an importer will not be required to sub- mit a certification or other informa- tion demonstrating that the good qualifies as originating under § 10.411(a) of this subpart for:

(1) A non-commercial importation of a good; or

(2) A commercial importation of a good whose value does not exceed U.S. $2,500, or the equivalent amount in Chilean currency.

(b) Exception. If the port director de- termines that an importation described in paragraph (a) of this section may reasonably be considered to have been carried out or planned for the purpose of evading compliance with the rules and procedures governing claims for preference under the US-CFTA, the port director will notify the importer in writing that for that importation the importer must submit to CBP a valid certification or other information demonstrating that the good qualifies as originating. The importer must sub- mit such a certification or other infor- mation within 30 calendar days from the date of the written notice. Failure to timely submit the certification or other information will result in denial of the claim for preferential tariff treatment.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76132, Dec. 20, 2006]

§ 10.415 Maintenance of records. (a) General. An importer claiming

preferential tariff treatment for a good imported into the United States must maintain, for five years after the date of importation of the good, a certifi- cation (or a copy thereof) or other in- formation demonstrating that the good qualifies as originating, and any records and documents that the im- porter has relating to the origin of the good, including records and documents associated with:

(1) The purchase of, cost of, value of, and payment for, the good;

(2) Where appropriate, the purchase of, cost of, value of, and payment for, all materials, including recovered

goods and indirect materials, used in the production of the good; and,

(3) Where appropriate, the production of the good in the form in which the good was exported.

(b) Method of maintenance. The records referred to in paragraph (a) of this section must be maintained by im- porters as provided in § 163.5 of this chapter.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76133, Dec. 20, 2006]

§ 10.416 Effect of noncompliance; fail- ure to provide documentation re- garding transshipment.

(a) Effect of noncompliance. If the im- porter fails to comply with any re- quirement under this subpart, includ- ing submission of a certification of ori- gin or other information dem- onstrating that the good qualifies as originating under § 10.411(a) of this sub- part or submission of a corrected cer- tification under § 10.413 of this subpart, the port director may deny preferential tariff treatment to the imported good.

(b) Failure to provide documentation re- garding transshipment. Where the re- quirements for preferential tariff treat- ment set forth elsewhere in this sub- part are met, the port director never- theless may deny preferential tariff treatment to an originating good if the good is shipped through or trans- shipped in a country other than Chile or the United States, and the importer of the good does not provide, at the re- quest of the port director, copies of documents demonstrating to the satis- faction of the port director that the re- quirements set forth in § 10.463 of this subpart were met.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76133, Dec. 20, 2006]

TARIFF PREFERENCE LEVEL

§ 10.420 Filing of claim for tariff pref- erence level.

A cotton or man-made fiber fabric or apparel good described in § 10.421 of this subpart that does not qualify as an originating good under § 10.451 of this subpart may nevertheless be entitled to preferential tariff treatment under the US-CFTA under an applicable tariff

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00256 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

247

U.S. Customs and Border Protection, DHS; Treasury § 10.422

1 The relevant HTSUS subheadings for fab- ric goods in Chapters 58 or 60 eligible under HTSUS 9911.99.20 are as follows: 5801.21, 5801.22, 5801.23, 5801.24, 5801.25, 5801.26, 5801.31, 5801.32, 5801.33, 5801.34, 5801.35, 5801.36, 5802.11, 5802.19, 5802.20.0020, 5802.30.0030, 5803.10, 5803.90.30, 5804.10.10, 5804.21, 5804.29.10, 5804.30.0020, 5805.00.30, 5805.00.4010, 5806.10.10, 5806.10.24, 5806.10.28, 5806.20, 5806.31, 5806.32, 5807.10.05, 5807.10.2010, 5807.10.2020, 5807.90.05, 5807.90.2010, 5807.90.2020, 5808.10.40, 5808.10.70, 5808.90.0010, 5809.00, 5810.10, 5810.91, 5810.92, 5811.00.20, 5811.00.30, 6001.10, 6001.21, 6001.22, 6001.91, 6001.92, 6002.40, 6002.90, 6003.20, 6003.30,

6003.40, 6004.10, 6004.90, 6005.21, 6005.22, 6005.23, 6005.24, 6005.31, 6005.32, 6005.33, 6005.34, 6005.41, 6005.42, 6005.43, 6005.44, 6006.21, 6006.22, 6006.23, 6006.24, 6006.31, 6006.32, 6006.33, 6006.34, 6006.41, 6006.42, 6006.43, 6006.44.

preference level (TPL). To make a TPL claim, the importer must include on the entry summary, or equivalent doc- umentation, the applicable subheading in Chapter 99 of the HTSUS (9911.99.20 for a good described in § 10.421(a) or (b) of this subpart or 9911.99.40 for a good described in § 10.421(c) of this subpart) immediately above the applicable sub- heading in Chapter 52 through 62 of the HTSUS under which each non-origi- nating cotton or man-made fiber fabric or apparel good is classified.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76133, Dec. 20, 2006]

§ 10.421 Goods eligible for tariff pref- erence claims.

The following goods are eligible for a TPL claim filed under § 10.420 of this subpart:

(a) Woven fabrics. Certain woven fab- rics of Chapters 52, 54 and 55 of the HTSUS (Headings 5208 to 5212; 5407 and 5408; 5512 to 5516) that meet the appli- cable conditions for preferential tariff treatment under the US-CFTA other than the condition that they are origi- nating goods, if they are wholly formed in the U.S. or Chile regardless of the origin of the yarn used to produce these fabrics.

(b) Cotton or man-made fabric goods. Certain cotton or man-made fabric goods of Chapters 58 and 60 of the HTSUS that meet the applicable condi- tions for preferential tariff treatment under the US-CFTA other than the condition that they are originating goods if they are wholly formed in the U.S. or Chile regardless of the origin of the fibers used to produce the spun yarn or the yarn used to produce the fabrics. 1

(c) Cotton or man-made apparel goods. Cotton or man-made apparel goods in Chapters 61 and 62 of the HTSUS that are both cut (or knit-to-shape) and sewn or otherwise assembled in the U.S. or Chile regardless of the origin of the fabric or yarn, provided that they meet the applicable conditions for pref- erential tariff treatment under the US- CFTA, other than the condition that they are originating goods.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76133, Dec. 20, 2006]

§ 10.422 Submission of certificate of eligibility.

(a) Contents. An importer who claims preferential tariff treatment on a non- originating cotton or man-made fiber fabric or apparel good must submit, at the request of the port director, a cer- tificate of eligibility containing infor- mation demonstrating that the good satisfies the requirements for entry under the applicable TPL, as set forth in § 10.421 of this subpart. A certificate of eligibility submitted to CBP under this section:

(1) Need not be in a prescribed format but must be in writing or must be transmitted electronically pursuant to any electronic means authorized by CBP for that purpose;

(2) Must include the following infor- mation:

(i) The legal name, address, tele- phone and e-mail address of the im- porter of record of the good;

(ii) The legal name and address of the responsible official or authorized agent of the importer signing the certificate (if different from the importer of record), and that person’s telephone and e-mail address, if available;

(iii) The legal name, address, tele- phone and e-mail address of the ex- porter of the good (if different from the producer);

(iv) The legal name, address, tele- phone and e-mail address of the pro- ducer of the good (if known);

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00257 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

248

19 CFR Ch. I (4–1–12 Edition)§ 10.423

(v) A description of the good, which must be sufficiently detailed to relate it to the invoice and the HS nomen- clature;

(vi) The HTSUS tariff classification of the good, to six or more digits, as well as the applicable subheading in Chapter 99 of the HTSUS (9911.99.20 or 9911.99.40);

(vii) For a single shipment, the com- mercial invoice number;

(viii) For multiple shipments of iden- tical goods, the blanket period in ‘‘mm/ dd/yyyy to mm/dd/yyyy’’ format (12- month maximum); and

(3) Must include a statement, in sub- stantially the following form:

‘‘I Certify that: The information on this document is true

and accurate and I assume the responsibility for proving such representations. I under- stand that I am liable for any false state- ments or material omissions made on or in connection with this document;

I agree to maintain and present upon re- quest, documentation necessary to support this certificate, and to inform, in writing, all persons to whom the certificate was given of any changes that could affect the accuracy or validity of this certificate; and

The goods were produced in the territory of one or more of the parties, and comply with the preference requirements specified for those goods in the United States-Chile Free Trade Agreement and Chapter 99, sub- chapter XI of the HTSUS. There has been no further production or any other operation outside the territories of the parties, other than unloading, reloading, or any other oper- ation necessary to preserve it in good condi- tion or to transport the good to the United States; and

This document consists of ll pages, in- cluding all attachments.’’

(b) Responsible official or agent. The certificate of eligibility required to be submitted under this section must be signed and dated by a responsible offi- cial of the importer or by the import- er’s authorized agent having knowledge of the relevant facts.

(c) Language. The certificate of eligi- bility must be completed either in the English or Spanish language. If the cer- tificate is completed in Spanish, the importer must also provide to the port director, upon request, a written English translation of the certificate;

(d) Applicability of certificate of eligi- bility. A certificate of eligibility may be applicable to:

(1) A single importation of a good into the United States, including a sin- gle shipment that results in the filing of one or more entries and a series of shipments that results in the filing of one entry; or

(2) Multiple importations of identical goods into the United States that occur within a specified blanket period, not exceeding 12 months, set out in the certificate.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76133, Dec. 20, 2006]

§ 10.423 Certificate of eligibility not re- quired.

(a) General. Except as otherwise pro- vided in paragraph (b) of this section, an importer will not be required to sub- mit a certificate of eligibility for:

(1) A non-commercial importation of a good; or

(2) A commercial importation of a good whose value does not exceed U.S. $2,500, or the equivalent amount in Chilean currency.

(b) Exception. If the port director de- termines that an importation described in paragraph (a) of this section may reasonably be considered to have been carried out or planned for the purpose of evading compliance with the rules and procedures governing TPL claims for preference under the US-CFTA, the port director will notify the importer in writing that for that importation the importer must submit to CBP a valid certificate of eligibility. The im- porter must submit such a certificate within 30 calendar days from the date of the written notice. Failure to timely submit the certificate will result in de- nial of the claim for preferential tariff treatment.

§ 10.424 Effect of noncompliance; fail- ure to provide documentation re- garding transshipment of non-origi- nating cotton or man-made fiber fabric or apparel goods.

(a) Effect of noncompliance. If the im- porter fails to comply with any re- quirement under this subpart, includ- ing submission of a certificate of eligi- bility under § 10.422 of this subpart, the port director may deny preferential tariff treatment to the imported good.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00258 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

249

U.S. Customs and Border Protection, DHS; Treasury § 10.430

(b) Failure to provide documentation re- garding transshipment. Where the re- quirements for preferential tariff treat- ment set forth elsewhere in this sub- part are met, the port director never- theless may deny preferential tariff treatment to a good for which a TPL claim is made if the good is shipped through or transshipped in a country other than Chile or the United States, and the importer of the good does not provide, at the request of the port di- rector, copies of documents dem- onstrating to the satisfaction of the port director that the requirements set forth in § 10.425 of this subpart were met.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76133, Dec. 20, 2006]

§ 10.425 Transit and transshipment of non-originating cotton or man- made fiber fabric or apparel goods.

(a) General. A good will not be consid- ered eligible for preferential tariff treatment under an applicable TPL by reason of having undergone production that occurs entirely in the territory of Chile, the United States, or both, that would enable the good to qualify for preferential tariff treatment if subse- quent to that production the good un- dergoes further production or any other operation outside the territories of Chile and the United States, other than unloading, reloading, or any other process necessary to preserve the good in good condition or to transport the good to the territory of Chile or the United States.

(b) Documentary evidence. An im- porter making a claim for preferential tariff treatment may be required to demonstrate, to CBP’s satisfaction, that no further production or subse- quent operation, other than permitted under paragraph (a) of this section, oc- curred outside the territories of Chile or the United States. An importer may demonstrate compliance with this sec- tion by submitting documentary evi- dence. Such evidence may include, but is not limited to, bills of lading, pack- ing lists, commercial invoices, and cus- toms entry and exit documents.

EXPORT REQUIREMENTS

§ 10.430 Export requirements. (a) Submission of certification to CBP.

An exporter or producer in the United States that signs a certification of ori- gin for a good exported from the United States to Chile must provide a copy of the certification (or such other me- dium or format approved by the Chile customs authority for that purpose) to CBP upon request.

(b) Notification of errors in certifi- cation. An exporter or producer in the United States who has completed and signed a certification of origin, and who has reason to believe that the cer- tification contains or is based on infor- mation that is not correct, must imme- diately after the date of discovery of the error notify in writing all persons to whom the certification was given by the exporter or producer of any change that could affect the accuracy or valid- ity of the certification.

(c) Maintenance of records—(1) Gen- eral. An exporter or producer in the United States that signs a certification of origin for a good exported from the United States to Chile must maintain in the United States, for a period of at least five years after the date the cer- tification was signed, all records and supporting documents relating to the origin of a good for which the certifi- cation was issued, including records and documents associated with:

(i) The purchase of, cost of, value of, and payment for, the good;

(ii) Where appropriate, the purchase of, cost of, value of, and payment for, all materials, including recovered goods and indirect materials, used in the production of the good; and

(iii) Where appropriate, the produc- tion of the good in the form in which the good was exported.

(2) Method of maintenance. The records referred to in paragraph (c) of this section must be maintained in ac- cordance with the Generally Accepted Accounting Principles applied in the country of production and in the case of exporters or producers in the United States must be maintained in the same manner as provided in § 163.5 of this chapter.

(3) Availability of records. For pur- poses of determining compliance with

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00259 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

250

19 CFR Ch. I (4–1–12 Edition)§ 10.431

the provisions of this part, the export- er’s or producer’s records required to be maintained under this section must be stored and made available for exam- ination and inspection by the port di- rector or other appropriate CBP officer in the same manner as provided in part 163 of this chapter.

§ 10.431 Failure to comply with re- quirements.

The port director may apply such measures as the circumstances may warrant where an exporter or a pro- ducer in the United States fails to com- ply with any requirement of this part. Such measures may include the impo- sition of penalties pursuant to 19 U.S.C. 1508(g) for failure to retain records required to be maintained under § 10.430.

POST-IMPORTATION DUTY REFUND CLAIMS

§ 10.440 Right to make post-importa- tion claim and refund duties.

Notwithstanding any other available remedy, where a good would have qualified as an originating good when it was imported into the United States but no claim for preferential tariff treatment was made, the importer of that good may file a claim for a refund of any excess duties at any time within one year after the date of importation of the good in accordance with the pro- cedures set forth in § 10.441 of this sub- part. Subject to the provisions of § 10.416 of this subpart, CBP may refund any excess duties by liquidation or re- liquidation of the entry covering the good in accordance with § 10.442(c) of this part.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76133, Dec. 20, 2006]

§ 10.441 Filing procedures. (a) Place of filing. A post-importation

claim for a refund under § 10.440 of this subpart must be filed with the director of the port at which the entry covering the good was filed.

(b) Contents of claim. A post-importa- tion claim for a refund must be filed by presentation of the following:

(1) A written declaration stating that the good qualified as an originating

good at the time of importation and setting forth the number and date of the entry or entries covering the good;

(2) Subject to § 10.413 of this subpart, a copy of a certification of origin or other information demonstrating that the good qualifies for preferential tariff treatment;

(3) A written statement indicating whether or not the importer of the good provided a copy of the entry sum- mary or equivalent documentation to any other person. If such documenta- tion was so provided, the statement must identify each recipient by name, CBP identification number and address and must specify the date on which the documentation was provided; and

(4) A written statement indicating whether or not any person has filed a protest relating to the good under any provision of law; and if any such pro- test has been filed, the statement must identify the protest by number and date.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76133, Dec. 20, 2006]

§ 10.442 CBP processing procedures.

(a) Status determination. After receipt of a post-importation claim under § 10.441 of this subpart, the port direc- tor will determine whether the entry covering the good has been liquidated and, if liquidation has taken place, whether the liquidation has become final.

(b) Pending protest or judicial review. If the port director determines that any protest relating to the good has not been finally decided, the port director will suspend action on the claim for re- fund filed under this subpart until the decision on the protest becomes final. If a summons involving the tariff clas- sification or dutiability of the good is filed in the Court of International Trade, the port director will suspend action on the claim for refund filed under this subpart until judicial review has been completed.

(c) Allowance of claim—(1) Unliqui- dated entry. If the port director deter- mines that a claim for a refund filed under this subpart should be allowed and the entry covering the good has not been liquidated, the port director

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00260 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

251

U.S. Customs and Border Protection, DHS; Treasury § 10.450

will take into account the claim for re- fund under this subpart in connection with the liquidation of the entry.

(2) Liquidated entry. If the port direc- tor determines that a claim for a re- fund filed under this subpart should be allowed and the entry covering the good has been liquidated, whether or not the liquidation has become final, the entry must be reliquidated in order to effect a refund of duties pursuant to this subpart. If the entry is otherwise to be reliquidated based on administra- tive review of a protest or as a result of judicial review, the port director will reliquidate the entry taking into ac- count the claim for refund under this subpart.

(d) Denial of claim—(1) General. The port director may deny a claim for a refund filed under § 10.441 of this sub- part if the claim was not filed timely, if the importer has not complied with the requirements of § 10.441 of this sub- part, if the certification submitted under § 10.441(b)(2) of this subpart can- not be accepted as valid (see § 10.413 of this subpart), or if, following an origin verification under § 10.470 of this sub- part, the port director determines ei- ther that the imported good did not qualify as an originating good at the time of importation or that a basis ex- ists upon which preferential tariff treatment may be denied under § 10.470 of this subpart.

(2) Unliquidated entry. If the port di- rector determines that a claim for a re- fund filed under this subpart should be denied and the entry covering the good has not been liquidated, the port direc- tor will deny the claim in connection with the liquidation of the entry, and notice of the denial and the reason for the denial will be provided to the im- porter in writing or via an authorized electronic data interchange system.

(3) Liquidated entry. If the port direc- tor determines that a claim for a re- fund filed under this subpart should be denied and the entry covering the good has been liquidated, whether or not the liquidation has become final, the claim may be denied without reliquidation of the entry. If the entry is otherwise to be reliquidated based on administra- tive review of a protest or as a result of judicial review, such reliquidation may include denial of the claim filed under

this subpart. In either case, the port di- rector will give the importer notice of the denial and the reason for the denial in writing or via an authorized elec- tronic data interchange system.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76133, Dec. 20, 2006; CBP Dec. 10–29, 75 FR 52450, Aug. 26, 2010]

RULES OF ORIGIN

§ 10.450 Definitions.

For purposes of §§ 10.450 through 10.463 of this subpart:

(a) Adjusted value. ‘‘Adjusted value’’ means the value determined in accord- ance with Articles 1 through 8, Article 15, and the corresponding interpreta- tive notes of the Customs Valuation Agreement, adjusted, if necessary, to exclude any costs, charges, or expenses incurred for transportation, insurance, and related services incident to the international shipment of the mer- chandise from the country of expor- tation to the place of importation and the value of packing materials and containers for shipment as defined in § 10.450(m) of this subpart;

(b) Exporter. ‘‘Exporter’’ means a per- son who exports goods from the terri- tory of a Party;

(c) Fungible goods or materials. ‘‘Fun- gible goods or materials’’ means goods or materials that are interchangeable for commercial purposes and whose properties are essentially identical;

(d) Generally Accepted Accounting Principles. ‘‘Generally Accepted Ac- counting Principles’’ means the prin- ciples, rules, and procedures, including both broad and specific guidelines, that define the accounting practices accept- ed in the territory of a Party;

(e) Good. ‘‘Good’’ means any mer- chandise, product, article, or material;

(f) Goods wholly obtained or produced entirely in the territory of one or both of the Parties. ‘‘Goods wholly obtained or produced entirely in the territory of one or both of the Parties’’ means:

(1) Mineral goods extracted in the territory of one or both of the Parties;

(2) Vegetable goods, as such goods are defined in the Harmonized System, harvested in the territory of one or both of the Parties;

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00261 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

252

19 CFR Ch. I (4–1–12 Edition)§ 10.450

(3) Live animals born and raised in the territory of one or both of the Par- ties;

(4) Goods obtained from hunting, trapping, or fishing in the territory of one or both of the Parties;

(5) Goods (fish, shellfish, and other marine life) taken from the sea by ves- sels registered or recorded with a Party and flying its flag;

(6) Goods produced on board factory ships from the goods referred to in paragraph (f)(5) provided such factory ships are registered or recorded with that Party and fly its flag;

(7) Goods taken by a Party or a per- son of a Party from the seabed or be- neath the seabed outside territorial waters, provided that a Party has rights to exploit such seabed;

(8) Goods taken from outer space, provided they are obtained by a Party or a person of a Party and not proc- essed in the territory of a non-Party;

(9) Waste and scrap derived from: (i) Production in the territory of one

or both of the Parties, or (ii) Used goods collected in the terri-

tory of one or both of the Parties, pro- vided such goods are fit only for the re- covery of raw materials;

(10) Recovered goods derived in the territory of a Party from used goods, and utilized in the Party’s territory in the production of remanufactured goods; and

(11) Goods produced in the territory of one or both of the Parties exclu- sively from goods referred to in para- graphs (f)(1) through (f)(10) of this sec- tion, or from their derivatives, at any stage of production;

(g) Importer. ‘‘Importer’’ means a per- son who imports goods into the terri- tory of a Party;

(h) Issued. ‘‘Issued’’ means prepared by and, where required under a Party’s domestic law or regulation, signed by the importer, exporter, or producer of the good;

(i) Location of the producer. ‘‘Location of the producer’’ means site of produc- tion of a good;

(j) Material. ‘‘Material’’ means a good that is used in the production of an- other good, including a part, ingre- dient, or indirect material;

(k) Non-originating good. ‘‘Non-origi- nating good’’ means a good that does

not qualify as originating under this subpart;

(l) Non-originating material. ‘‘Non- originating material’’ means a mate- rial that does not qualify as origi- nating under this subpart;

(m) Packing materials and containers for shipment. ‘‘Packing materials and containers for shipment’’ means the goods used to protect a good during its transportation to the United States, and does not include the packaging ma- terials and containers in which a good is packaged for retail sale;

(n) Producer. ‘‘Producer’’ means a person who engages in the production of a good in the territory of a Party;

(o) Production. ‘‘Production’’ means growing, mining, harvesting, fishing, raising, trapping, hunting, manufac- turing, processing, assembling, or dis- assembling a good;

(p) Recovered goods. ‘‘Recovered goods’’ means materials in the form of individual parts that are the result of:

(1) The complete disassembly of used goods into individual parts; and

(2) The cleaning, inspecting, testing, or other processing of those parts as necessary for improvement to sound working condition by one or more of the following processes: welding, flame spraying, surface machining, knurling, plating, sleeving, and rewinding in order for such parts to be assembled with other parts, including other re- covered parts in the production of a re- manufactured good of Annex 4.18, US- CFTA;

(q) Remanufactured goods. ‘‘Remanu- factured goods’’ means industrial goods assembled in the territory of a Party, listed in Annex 4.18, US-CFTA, that:

(1) Are entirely or partially com- prised of recovered goods;

(2) Have the same life expectancy and meet the same performance standards as new goods; and

(3) Enjoy the same factory warranty as such new goods; and

(r) Self-produced material. ‘‘Self-pro- duced material’’ means a material that is produced by the producer of a good and used in the production of that good; and

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00262 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

253

U.S. Customs and Border Protection, DHS; Treasury § 10.455

(s) Value. ‘‘Value’’ means the value of a good or material for purposes of cal- culating customs duties or for purposes of applying this subpart.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76133, Dec. 20, 2006]

§ 10.451 Originating goods. A good imported into the customs

territory of the United States will be considered an originating good under the US-CFTA only if:

(a) The good is wholly obtained or produced entirely in the territory of Chile or of the United States, or both; or

(b) The good is produced entirely in the territory of Chile or of the United States, or both, satisfies all other ap- plicable requirements of this subpart, and

(1) Each of the non-originating mate- rials used in the production of the good undergoes an applicable change in tar- iff classification specified in General Note 26(n), HTSUS, and

(2) The good otherwise satisfies any applicable regional value content or other requirements specified in Gen- eral Note 26(n), HTSUS; or

(c) The good is produced entirely in the territory of Chile or the United States, or both, exclusively from origi- nating materials.

§ 10.452 Exclusions. A good will not be considered to be

an originating good and a material will not be considered to be an originating material by virtue of having under- gone:

(a) Simple combining or packaging operations; or

(b) Mere dilution with water or with another substance that does not mate- rially alter the characteristics of the good or material.

§ 10.453 Treatment of textile and ap- parel sets.

Notwithstanding the specific rules specified in General Note 26(n), HTSUS, textile and apparel goods classifiable as goods put up in sets for retail sale as provided for in General Rule of Inter- pretation 3, HTSUS, will not be re- garded as originating goods unless each of the goods in the set is an originating

good or the non-originating goods in the set do not exceed 10 percent of the adjusted value of the set.

§ 10.454 Regional value content.

Where General Note 26, subdivision (n), HTSUS, sets forth a rule that specifies a regional value content test for a good, the regional value content of such good may be calculated, at the choice of the person claiming the tariff treatment authorized by this note for such good, on the basis of the build- down method or the build-up method described in this section, unless other- wise specified in the note.

(a) Build-down method. For the build- down method, the regional value con- tent must be calculated on the basis of the formula RVC = ((AV–VNM)/AV) × 100, where RVC is the regional value content, expressed as a percentage; AV is the adjusted value; and VNM is the value of non-originating materials used by the producer in the production of the good; or

(b) Build-up method. For the build-up method, the regional value content must be calculated on the basis of the formula RVC = (VOM/AV) × 100, where RVC is the regional value content, ex- pressed as a percentage; AV is the ad- justed value; and VOM is the value of originating materials used by the pro- ducer in the production of the good.

§ 10.455 Value of materials.

(a) Calculating the regional value con- tent. For purposes of calculating the re- gional value content of a good under General Note 26(n), HTSUS, and for purposes of applying the de minimis (see § 10.459) provisions of subdivision (e) of the note, the value of a material is:

(1) In the case of a material imported by the producer of the good, the ad- justed value of the material with re- spect to that importation;

(2) In the case of a material acquired in the territory where the good is pro- duced, except for a material to which paragraph (a)(3) of this section applies, the producer’s price actually paid or payable for the material;

(3) In the case of a material provided to the producer without charge, or at a price reflecting a discount or similar reduction, the sum of—

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00263 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

254

19 CFR Ch. I (4–1–12 Edition)§ 10.456

(i) All expenses incurred in the growth, production or manufacture of the material, including general ex- penses, and

(ii) A reasonable amount for profit; or

(4) In the case of a material that is self-produced, the sum of—

(i) All expenses incurred in the pro- duction of the material, including gen- eral expenses, and

(ii) A reasonable amount for profit. (b) Permissible additions to, and deduc-

tions from, the value of materials. The value of materials may be adjusted as follows:

(1) For originating materials, the fol- lowing expenses, if not included under paragraph (a) of this section, may be added to the value of the originating material:

(i) The costs of freight, insurance, packing and all other costs incurred in transporting the material to the loca- tion of the producer;

(ii) Duties, taxes and customs broker- age fees on the material paid in the territory of Chile or of the United States, or both, other than duties and taxes that are waived, refunded, re- fundable or otherwise recoverable, in- cluding credit against duty or tax paid or payable; and

(iii) The cost of waste and spoilage resulting from the use of the material in the production of the good, less the value of renewable scrap or by-product; and

(2) For non-originating materials, if included under paragraph (a) of this section, the following expenses may be deducted from the value of the non- originating material:

(i) The costs of freight, insurance, packing and all other costs incurred in transporting the material to the loca- tion of the producer;

(ii) Duties, taxes and customs broker- age fees on the material paid in the territory of Chile or of the United States, or both, other than duties and taxes that are waived, refunded, re- fundable or otherwise recoverable, in- cluding credit against duty or tax paid or payable;

(iii) The cost of waste and spoilage resulting from the use of the material in the production of the good, less the

value of renewable scrap or by-prod- ucts; and

(iv) The cost of originating materials used in the production of the non-origi- nating material in the territory of Chile or of the United States.

(c) Accounting method. Any cost or value referenced in General Note 26(n), HTSUS, and this subpart, must be re- corded and maintained in accordance with the generally accepted accounting principles applicable in the territory of the Party in which the good is pro- duced (whether Chile or the United States).

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76133, Dec. 20, 2006]

§ 10.456 Accessories, spare parts or tools.

Accessories, spare parts or tools that form part of the good’s standard acces- sories, spare parts or tools and are de- livered with the good will be treated as a material used in the production of the good, if—

(a) The accessories, spare parts or tools are classified with and not invoiced separately from the good; and

(b) The quantities and value of the accessories, spare parts or tools are customary for the good.

§ 10.457 Fungible goods and materials. (a) A person claiming preferential

tariff treatment under the US-CFTA for a good may claim that a fungible good or material is originating either based on the physical segregation of each fungible good or material or by using an inventory management meth- od. For purposes of this subpart, the term ‘‘inventory management method’’ means—

(1) Averaging, (2) ‘‘Last-in, first-out,’’ (3) ‘‘First-in, first-out,’’ or (4) Any other method that is recog-

nized in the generally accepted ac- counting principles of the Party in which the production is performed (whether Chile or the United States) or otherwise accepted by that Party.

(b) A person selecting an inventory management method under paragraph (a) of this section for particular fun- gible goods or materials must continue to use that method for those fungible

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00264 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

255

U.S. Customs and Border Protection, DHS; Treasury § 10.459

goods or materials throughout the fis- cal year of that person.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76134, Dec. 20, 2006]

§ 10.458 Accumulation. (a) Originating goods or materials of

Chile or the United States that are in- corporated into a good in the territory of the other Party will be considered to originate in the territory of the other Party for purposes of determining the eligibility of the goods or materials for preferential tariff treatment under the US-CFTA.

(b) A good that is produced in the territory of Chile, the United States, or both, by one or more producers, will be considered as an originating good if the good satisfies the applicable require- ments of § 10.451 and General Note 26, HTSUS.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76134, Dec. 20, 2006]

§ 10.459 De minimis. (a) Except as provided in paragraphs

(b) and (c) of this section, a good that does not undergo a change in tariff classification pursuant to General Note 26(n), HTSUS, will nonetheless be con- sidered to be an originating good if—

(1) The value of all non-originating materials that are used in the produc- tion of the good and do not undergo the applicable change in tariff classifica- tion does not exceed 10 percent of the adjusted value of the good;

(2) The value of such non-originating materials is included in calculating the value of non-originating materials for any applicable regional value-content requirement under this note; and

(3) The good meets all other applica- ble requirements of General Note 26(n), HTSUS.

(b) Paragraph (a) of this section does not apply to:

(1) A non-originating material pro- vided for in Chapter 4 of the Har- monized System, or a non-originating dairy preparation containing over 10 percent by weight of milk solids pro- vided for in subheadings 1901.90 or 2106.90 of the Harmonized System, that is used in the production of a good pro-

vided for in Chapter 4 of the Har- monized System;

(2) A non-originating material pro- vided for in Chapter 4 of the Har- monized System, or non-originating dairy preparations containing over 10 percent by weight of milk solids pro- vided for in subheading 1901.90 of the Harmonized System, that are used in the production of the following goods: infant preparations containing over 10 percent in weight of milk solids pro- vided for in subheading 1901.10 of the Harmonized System; mixes and doughs, containing over 25 percent by weight of butterfat, not put up for retail sale, provided for in subheading 1901.20 of the Harmonized System; dairy prepara- tions containing over 10 percent by weight of milk solids provided for in subheadings 1901.90 or 2106.90 of the Harmonized System; goods provided for in heading 2105 of the Harmonized Sys- tem; beverages containing milk pro- vided for in subheading 2202.90 of the Harmonized System; or animal feeds containing over 10 percent by weight of milk solids provided for in subheading 2309.90 of the Harmonized System;

(3) A non-originating material pro- vided for in heading 0805 of the Har- monized System or subheadings 2009.11 through 2009.30 of the Harmonized Sys- tem that is used in the production of a good provided for in subheadings 2009.11 through 2009.30 of the Harmonized Sys- tem, or in fruit or vegetable juice of any single fruit or vegetable, fortified with minerals or vitamins, con- centrated or unconcentrated, provided for in subheadings 2106.90 or 2202.90 of the Harmonized System;

(4) A non-originating material pro- vided for in Chapter 15 of the Har- monized System that is used in the production of a good provided for in headings 1501 through 1508, 1512, 1514, or 1515 of the Harmonized System;

(5) A non-originating material pro- vided for in heading 1701 of the Har- monized System that is used in the production of a good provided for in headings 1701 through 1703 of the Har- monized System;

(6) A non-originating material pro- vided for in Chapter 17 or in heading 1805 of the Harmonized System that is

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00265 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

256

19 CFR Ch. I (4–1–12 Edition)§ 10.460

used in the production of a good pro- vided for in subheading 1806.10 of the Harmonized System;

(7) A non-originating material pro- vided for in headings 2203 through 2208 of the Harmonized System that is used in the production of a good provided for in heading 2207 or 2208 of the Har- monized System; and

(8) A non-originating material used in the production of a good provided for in Chapters 1 through 21 of the Har- monized System unless the non-origi- nating material is provided for in a dif- ferent subheading than the good for which origin is being determined under this section.

(c) A textile or apparel good provided for in Chapters 50 through 63 of the Harmonized System that is not an originating good because certain fibers or yarns used in the production of the component of the good that determines the tariff classification of the good do not undergo an applicable change in tariff classification set out in General Note 26(n), HTSUS, shall nonetheless be considered to be an originating good if the total weight of all such fibers or yarns in that component is not more than seven percent of the total weight of that component. A good containing elastomeric yarns in the component of the good that determines the tariff classification of the good shall be con- sidered to be an originating good only if such yarns are wholly formed in the territory of a Party. For purposes of this paragraph, if a good is a fiber, yarn or fabric, the component of the good that determines the tariff classi- fication of the good is all of the fibers in the yarn, fabric or group of fibers.

§ 10.460 Indirect materials. An indirect material, as defined in

§ 10.402(o), will be considered to be an originating material without regard to where it is produced.

Example. Chilean Producer C produces good C using non-originating material A. Pro- ducer C imports non-originating rubber gloves for use by workers in the production of good C. Good C is subject to a tariff shift requirement. As provided in § 10.451(b)(1) and General Note 26(n), each of the non-origi- nating materials in good C must undergo the specified change in tariff classification in order for good C to be considered originating. Although non-originating material A must

undergo the applicable tariff shift in order for good C to be considered originating, the rubber gloves do not because they are indi- rect materials and are considered origi- nating without regard to where they are pro- duced.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76134, Dec. 20, 2006]

§ 10.461 Retail packaging materials and containers.

Packaging materials and containers in which a good is packaged for retail sale, if classified with the good for which preferential tariff treatment under the US-CFTA is claimed, will be disregarded in determining whether all non-originating materials used in the production of the good undergo the ap- plicable change in tariff classification set out in General Note 26(n), HTSUS. If the good is subject to a regional value content requirement, the value of such packaging materials and con- tainers will be taken into account as originating or non-originating mate- rials, as the case may be, in calculating the regional value content of the good.

Example 1. Chilean Producer A of good C imports 100 non-originating blister packages to be used as retail packaging for good C. As provided in § 10.455(a)(1), the value of the blis- ter packages is their adjusted value, which in this case is $10. Good C has a regional value content requirement. The United States importer of good C decides to use the build-down method, RVC = ((AV–VNM)/AV) × 100 (see § 10.454(a) of this subpart), in deter- mining whether good C satisfies the regional value content requirement. In applying this method, the non-originating blister packages are taken into account as non-originating. As such, their $10 adjusted value is included in the VNM, value of non-originating mate- rials, of good C.

Example 2. Same facts as in Example 1, but the blister packages are originating. In this case, the adjusted value of the originating blister packages would not be included as part of the VNM of good C under the build- down method. However, if the United States importer had used the build-up method, RVC = (VOM/AV) × 100 (see § 10.454(b)), the adjusted value of the blister packaging would be in- cluded as part of the VOM, value of origi- nating material.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76134, Dec. 20, 2006]

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00266 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

257

U.S. Customs and Border Protection, DHS; Treasury § 10.470

§ 10.462 Packing materials and con- tainers for shipment.

(a) Packing materials and containers for shipment, as defined in § 10.450(m), are to be disregarded in determining whether the non-originating materials used in the production of the good un- dergo an applicable change in tariff classification set out in General Note 26(n), HTSUS. Accordingly, such mate- rials and containers do not have to un- dergo the applicable change in tariff classification even if they are non-orig- inating.

(b) Packing materials and containers for shipment, as defined in § 10.450(m), are to be disregarded in determining the regional value content of a good imported into the United States. Ac- cordingly, in applying either the build- down or build-up method for deter- mining the regional value content of the good imported into the United States, the value of such packing mate- rials and containers for shipment (whether originating or non-origi- nating) is disregarded and not included in AV, adjusted value, VNM, value of non-originating materials, or VOM, value of originating materials.

Example. Chilean Producer A produces good C. Producer A ships good C to the United States in a shipping container which it pur- chased from Company B in Chile. The ship- ping container is originating. The value of the shipping container determined under sec- tion § 10.455(a)(2) is $3. Good C is subject to a regional value content requirement. The transaction value of good C is $100, which in- cludes the $3 shipping container. The U.S. importer decides to use the build-up method, RVC = (VOM/AV) × 100 (see § 10.454(b)), in de- termining whether good C satisfies the re- gional value content requirement. In deter- mining the AV, adjusted value, of good C im- ported into the U.S., paragraph (b) of this section requires a $3 deduction for the value of the shipping container. Therefore, the AV is $97 ($100–$3). In addition, the value of the shipping container is disregarded and not in- cluded in the VOM, value of originating ma- terials.

§ 10.463 Transit and transshipment. (a) General. A good will not be consid-

ered an originating good by reason of having undergone production that oc- curs entirely in the territory of Chile, the United States, or both, that would enable the good to qualify as an origi- nating good if subsequent to that pro-

duction the good undergoes further production or any other operation out- side the territories of Chile and the United States, other than unloading, reloading, or any other process nec- essary to preserve the good in good condition or to transport the good to the territory of Chile or the United States.

(b) Documentary evidence. An im- porter making a claim that a good is originating may be required to dem- onstrate, to CBP’s satisfaction, that no further production or subsequent oper- ation, other than permitted under paragraph (a) of this section, occurred outside the territories of Chile or the United States. An importer may dem- onstrate compliance with this section by submitting documentary evidence. Such evidence may include, but is not limited to, bills of lading, packing lists, commercial invoices, and cus- toms entry and exit documents.

ORIGIN VERIFICATIONS AND DETERMINATIONS

§ 10.470 Verification and justification of claim for preferential treatment.

(a) Verification. A claim for pref- erential tariff treatment made under § 10.410 or § 10.442 of this subpart, in- cluding any statements or other infor- mation submitted to CBP in support of the claim, will be subject to such verification as the port director deems necessary. In the event that the port director is provided with insufficient information to verify or substantiate the claim, the port director may deny the claim for preferential tariff treat- ment. A verification of a claim for preferential treatment may involve, but is not limited to, a review of:

(1) All records required to be made, kept, and made available to CBP by the importer or any other person under part 163 of this chapter;

(2) Documentation and other infor- mation regarding the country of origin of an article and its constituent mate- rials, including, but not limited to, production records, supporting ac- counting and financial records, infor- mation relating to the place of produc- tion, the number and identification of

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00267 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

258

19 CFR Ch. I (4–1–12 Edition)§ 10.471

the types of machinery used in produc- tion, and the number of workers em- ployed in production; and

(3) Evidence that documents the use of U.S. or Chilean materials in the pro- duction of the article subject to the verification, such as purchase orders, invoices, bills of lading and other ship- ping documents, customs import and clearance documents, and bills of ma- terial and inventory records.

(b) Applicable accounting principles. When conducting a verification of ori- gin to which Generally Accepted Ac- counting Principles may be relevant, CBP will apply and accept the Gen- erally Accepted Accounting Principles applicable in the country of produc- tion.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76134, Dec. 20, 2006; CBP Dec. 10–29, 75 FR 52450, Aug. 26, 2010]

§ 10.471 Special rule for verifications in Chile of U.S. imports of textile and apparel products.

(a) Procedures to determine whether a claim of origin is accurate. For the pur- pose of determining that a claim of ori- gin for a textile or apparel good is ac- curate, CBP may request that the gov- ernment of Chile conduct a verification, regardless of whether a claim is made for preferential tariff treatment. While a verification under this paragraph is being conducted, CBP may take appropriate action, as di- rected by The Committee for the Im- plementation of Textile Agreements (CITA), which may include suspending the application of preferential treat- ment to the textile or apparel good for which a claim of origin has been made. If CBP is unable to make the deter- mination described in this paragraph within 12 months after a request for a verification, CBP may take appro- priate action with respect to the tex- tile and apparel good subject to the verification, and with respect to simi- lar goods exported or produced by the entity that exported or produced the good, if directed by CITA.

(b) Procedures to determine compliance with applicable customs laws and regula- tions of the U.S. For purposes of ena- bling CBP to determine that an ex- porter or producer is complying with

applicable customs laws, regulations, and procedures in cases in which CBP has a reasonable suspicion that a Chil- ean exporter or producer is engaging in unlawful activity relating to trade in textile and apparel goods, CBP may re- quest that the government of Chile conduct a verification, regardless of whether a claim is made for pref- erential tariff treatment. A ‘‘reason- able suspicion’’ for the purpose of this paragraph will be based on relevant factual information, including infor- mation of the type set forth in Article 5.5 of the US-CFTA, that indicates cir- cumvention of applicable laws, regula- tions or procedures regarding trade in textile and apparel goods. CBP may un- dertake or assist in a verification under this paragraph by conducting visits in Chile, along with the com- petent authorities of Chile, to the premises of an exporter, producer or any other enterprise involved in the movement of textile or apparel goods from Chile to the United States. While a verification under this paragraph is being conducted, CBP may take appro- priate action, as directed by CITA, which may include suspending the ap- plication of preferential tariff treat- ment to the textile and apparel goods exported or produced by the Chilean entity where the reasonable suspicion of unlawful activity relates to those goods. If CBP is unable to make the de- termination described in this para- graph within 12 months after a request for a verification, CBP may take appro- priate action with respect to any tex- tile or apparel goods exported or pro- duced by the entity subject to the verification, if directed by CITA.

(c) Assistance by CBP to Chilean au- thorities. CBP may undertake or assist in a verification under this section by conducting visits in Chile, along with the competent authorities of Chile, to the premises of an exporter, producer or any other enterprise involved in the movement of textile or apparel goods from Chile to the United States.

(d) Treatment of documents and infor- mation provided to CBP. Any produc- tion, trade and transit documents and other information necessary to conduct a verification under this section, pro- vided to CBP by the government of

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00268 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

259

U.S. Customs and Border Protection, DHS; Treasury § 10.473

Chile consistent with the laws, regula- tions, and procedures of Chile, will be considered confidential as provided for in Article 5.6 of the US-CFTA.

(e) Notification to Chile. Prior to com- mencing appropriate action under paragraph (a) or (b) of this section, CBP will notify the government of Chile. CBP may continue to take ap- propriate action under paragraph (a) or (b) of this section until it receives in- formation sufficient to enable it to make the determination described in paragraphs (a) and (b) of this section.

(f) Retention of authority by CBP. If CBP requests a verification before Chile fully implements its obligations under Article 3.21 of the US-CFTA, the verification will be conducted prin- cipally by CBP, including through means described in paragraphs (a) and (b) of this section. CBP retains the au- thority to exercise its rights under paragraphs (a) and (b) of this section.

§ 10.472 Verification in the United States of textile and apparel goods.

(a) Procedures to determine whether a claim of origin is accurate. CBP will en- deavor, at the request of the govern- ment of Chile, to conduct a verification for the purpose of determining that a claim of origin for a textile or apparel good is accurate. A verification will be conducted under this paragraph regard- less of whether a claim is made for preferential tariff treatment. If the government of Chile is unable to make the determination described in this paragraph within 12 months after a re- quest for a verification, Chile may take appropriate action with respect to the textile and apparel good subject to the verification, and with respect to simi- lar goods exported or produced by the entity that exported or produced the good.

(b) Procedures to determine compliance with applicable customs laws and regula- tions of Chile. CBP will endeavor to con- duct a verification at the request of the government of Chile for purposes of en- abling Chile to determine that the U.S. exporter or producer is complying with applicable customs laws, regulations, and procedures, if Chile has a reason- able suspicion that a U.S. exporter or producer is engaging in unlawful activ- ity relating to trade in textile and ap-

parel goods. A verification will be con- ducted under this paragraph regardless of whether a claim is made for pref- erential tariff treatment. A ‘‘reason- able suspicion’’ for the purpose of this paragraph will be based on relevant factual information, including infor- mation of the type set forth in Article 5.5 of the US-CFTA, that indicates cir- cumvention of applicable laws, regula- tions or procedures regarding trade in textile and apparel goods. If the gov- ernment of Chile is unable to make the determination described in this para- graph within 12 months after a request for a verification, it may take action as permitted under its laws with re- spect to any textile or apparel goods exported or produced by the entity sub- ject to the verification.

(c) Visits by CBP. CBP may conduct visits to the premises of a U.S. ex- porter or producer or any other enter- prise involved in the movement of tex- tile or apparel goods from the United States to Chile in order to undertake or assist in a verification pursuant to paragraphs (a) and (b) of this section.

(d) Initiation of verification by CBP. CBP may conduct, on its own initia- tive, a verification for the purpose of determining that a claim of origin for a textile or apparel good is accurate.

(e) Treatment of documents and infor- mation. CBP will endeavor to provide to the government of Chile, consistent with U.S. laws, regulations, and proce- dures, production, trade, and transit documents and other information nec- essary to conduct a verification under paragraphs (a) and (b) of this section. Such information will be considered confidential as provided for in Article 5.6 of the US-CFTA.

§ 10.473 Issuance of negative origin de- terminations.

If CBP determines, as a result of an origin verification initiated under this subpart, that the good which is the subject of the verification does not qualify as an originating good, it will issue a determination in writing or via an authorized electronic data inter- change system to the importer that sets forth the following:

(a) A description of the good that was the subject of the verification together with the identifying numbers and dates

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00269 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

260

19 CFR Ch. I (4–1–12 Edition)§ 10.474

of the export and import documents pertaining to the good;

(b) A statement setting forth the findings of fact made in connection with the verification and upon which the determination is based;

(c) With specific reference to the rules applicable to originating goods as set forth in General Note 26, HTSUS, and in §§ 10.450 through 10.463 of this subpart, the legal basis for the deter- mination; and

(d) A notice of intent to deny pref- erential tariff treatment on the good which is the subject of the determina- tion.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76134, Dec. 20, 2006]

§ 10.474 Repeated false or unsupported preference claims.

Where verification or other informa- tion reveals indications of a pattern of conduct by an importer of false or un- supported representations that a good imported into the United States quali- fies as originating, CBP may deny sub- sequent claims for preferential tariff treatment on identical goods imported by that person until compliance with the rules applicable to originating goods as set forth in General Note 26, HTSUS is established to the satisfac- tion of CBP.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76134, Dec. 20, 2006]

PENALTIES

§ 10.480 General. Except as otherwise provided in this

subpart, all criminal, civil or adminis- trative penalties which may be im- posed on U.S. importers, exporters and producers for violations of the customs and related laws and regulations will also apply to U.S. importers, exporters and producers for violations of the laws and regulations relating to the US- CFTA.

§ 10.481 Corrected declaration by im- porters.

A U.S. importer who makes a cor- rected declaration under § 10.410(b) will not be subject to civil or administra- tive penalties for having made an in-

correct declaration, provided that the corrected declaration was voluntarily made.

§ 10.482 Corrected certifications of ori- gin by exporters or producers.

Civil or administrative penalties pro- vided for under the U.S. customs laws and regulations will not be imposed on an exporter or producer in the United States who voluntarily provides writ- ten notification pursuant to § 10.430(b) with respect to the making of an incor- rect certification.

§ 10.483 Framework for correcting dec- larations and certifications.

(a) ‘‘Voluntarily’’ defined. For pur- poses of this subpart, the making of a corrected declaration or the providing of written notification of an incorrect certification will be deemed to have been done voluntarily if:

(1) Done before the commencement of a formal investigation; or

(2) Done before any of the events specified in § 162.74(i) of this chapter have occurred; or

(3) Done within 30 calendar days after either the U.S. importer, exporter or producer had reason to believe that the declaration or certification was not correct; and is

(4) Accompanied by a written state- ment setting forth the information specified in paragraph (c) of this sec- tion; and

(5) In the case of a corrected declara- tion, accompanied or followed by a ten- der of any actual loss of duties and merchandise processing fees, if applica- ble, in accordance with paragraph (e) of this section.

(b) Cases involving fraud. Notwith- standing paragraph (a) of this section, a person who acted fraudulently in making an incorrect declaration or certification may not make a vol- untary correction. For purposes of this paragraph, the term ‘‘fraud’’ will have the meaning set forth in paragraph (B)(3) of appendix B to part 171 of this chapter.

(c) Statement. For purposes of this subpart, each corrected declaration or notification of an incorrect certifi- cation must be accompanied by a state- ment, submitted in writing or via an

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00270 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

261

U.S. Customs and Border Protection, DHS; Treasury § 10.490

authorized electronic data interchange system, which:

(1) Identifies the class or kind of good to which the incorrect declaration or certification relates;

(2) In the case of a corrected declara- tion, identifies each affected import transaction, including each port of im- portation and the approximate date of each importation, and in the case of a notification of an incorrect certifi- cation, identifies each affected expor- tation transaction, including each port of exportation and the approximate date of each exportation. A U.S. pro- ducer who provides written notifica- tion that certain information in a cer- tification of origin is incorrect and who is unable to identify the specific export transactions under this paragraph must provide as much information con- cerning those transactions as the pro- ducer, by the exercise of good faith and due diligence, is able to obtain;

(3) Specifies the nature of the incor- rect statements or omissions regarding the declaration or certification; and

(4) Sets forth, to the best of the per- son’s knowledge, the true and accurate information or data which should have been covered by or provided in the dec- laration or certification, and states that the person will provide any addi- tional pertinent information or data which is unknown at the time of mak- ing the corrected declaration or certifi- cation within 30 calendar days or with- in any extension of that 30-day period as CBP may permit in order for the person to obtain the information or data.

(d) Substantial compliance. For pur- poses of this section, a person will be deemed to have voluntarily corrected a declaration or certification even though that person provides corrected information in a manner which does not conform to the requirements of the written statement specified in para- graph (c) of this section, provided that:

(1) CBP is satisfied that the informa- tion was provided before the com- mencement of a formal investigation; and

(2) The information provided in- cludes, orally or in writing, substan- tially the same information as that specified in paragraph (c) of this sec- tion.

(e) Tender of actual loss of duties. A U.S. importer who makes a corrected declaration must tender any actual loss of duties at the time of making the corrected declaration, or within 30 cal- endar days thereafter, or within any extension of that 30-day period as CBP may allow in order for the importer to obtain the information or data nec- essary to calculate the duties owed.

(f) Applicability of prior disclosure pro- visions. Where a person fails to meet the requirements of this section be- cause the correction of the declaration or the written notification of an incor- rect certification is not considered to be done voluntarily as provided in this section, that person may nevertheless qualify for prior disclosure treatment under 19 U.S.C. 1592(c)(4) and § 162.74 of this chapter.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as amended by CBP Dec. 06–39, 71 FR 76134, Dec. 20, 2006]

GOODS RETURNED AFTER REPAIR OR ALTERATION

§ 10.490 Goods re-entered after repair or alteration in Chile.

(a) General. This section sets forth the rules which apply for purposes of obtaining duty-free treatment on goods returned after repair or alteration in Chile as provided for in subheadings 9802.00.40 and 9802.00.50, HTSUS. Goods returned after having been repaired or altered in Chile, whether or not pursu- ant to a warranty, are eligible for duty-free treatment, provided that the requirements of this section are met. For purposes of this section, ‘‘repairs or alterations’’ means restoration, ad- dition, renovation, re-dyeing, cleaning, re-sterilizing, or other treatment which does not destroy the essential characteristics of, or create a new or commercially different good from, the good exported from the United States.

(b) Goods not eligible for treatment. The duty-free treatment referred to in paragraph (a) of this section will not apply to goods which, in their condi- tion as exported from the United States to Chile, are incomplete for their intended use and for which the processing operation performed in Chile constitutes an operation that is performed as a matter of course in the

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00271 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

262

19 CFR Ch. I (4–1–12 Edition)§ 10.501

preparation or manufacture of finished goods.

(c) Documentation. The provisions of § 10.8(a), (b), and (c) of this part, relat- ing to the documentary requirements for goods entered under subheading 9802.00.40 or 9802.00.50, HTSUS, will apply in connection with the entry of goods which are returned from Chile after having been exported for repairs or alterations and which are claimed to be duty free.

Subpart I—United States- Singapore Free Trade Agreement

SOURCE: CBP Dec. 07–28, 72 FR 31995, June 11, 2007, unless otherwise noted.

GENERAL PROVISIONS

§ 10.501 Scope. This subpart implements the duty

preference and related customs provi- sions applicable to imported goods under the United States-Singapore Free Trade Agreement (the SFTA) signed on May 6, 2003, and under the United States-Singapore Free Trade Agreement Implementation Act (the Act; 117 Stat. 948). Except as otherwise specified in this subpart, the proce- dures and other requirements set forth in this subpart are in addition to the customs procedures and requirements of general application contained else- where in this chapter. Additional pro- visions implementing certain aspects of the SFTA and the Act are contained in parts 24, 162, and 163 of this chapter.

§ 10.502 General definitions. As used in this subpart, the following

terms will have the meanings indicated unless either the context in which they are used requires a different meaning or a different definition is prescribed for a particular section of this subpart:

(a) Claim for preferential tariff treat- ment. ‘‘Claim for preferential tariff treatment’’ means a claim that a good is entitled to the duty rate applicable under the SFTA to an originating good or other good specified in the SFTA, and to an exemption from the mer- chandise processing fee;

(b) Customs duty. ‘‘Customs duty’’ in- cludes any customs or import duty and a charge of any kind imposed in con-

nection with the importation of a good, including any form of surtax or sur- charge in connection with such impor- tation, but, for purposes of imple- menting the SFTA, does not include any:

(1) Charge equivalent to an internal tax imposed consistently with Article III:2 of GATT 1994 in respect of the like domestic good or in respect of goods from which the imported good has been manufactured or produced in whole or in part;

(2) Antidumping or countervailing duty that is applied pursuant to a Par- ty’s domestic law;

(3) Fee or other charge in connection with importation commensurate with the cost of services rendered; or

(4) Duty imposed pursuant to Article 5 of the WTO Agreement on Agri- culture.

(c) Customs Valuation Agreement. ‘‘Customs Valuation Agreement’’ means the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994, which is part of the WTO Agreement;

(d) Days. ‘‘Days’’ means calendar days;

(e) Enterprise. ‘‘Enterprise’’ means an entity constituted or organized under applicable law, whether or not for prof- it, and whether privately-owned or gov- ernmentally-owned, including any cor- poration, trust, partnership, sole pro- prietorship, joint venture, or other as- sociation;

(f) GATT 1994. ‘‘GATT 1994’’ means the General Agreement on Tariffs and Trade 1994, which is part of the WTO Agreement;

(g) Harmonized System. ‘‘Harmonized System (HS)’’ means the Harmonized Commodity Description and Coding Sys- tem, including its General Rules of In- terpretation, Section Notes, and Chap- ter Notes, as adopted and implemented by the Parties in their respective tariff laws;

(h) Heading. ‘‘Heading’’ means the first four digits in the tariff classifica- tion number under the Harmonized System;

(i) HTSUS. ‘‘HTSUS’’ means the Har- monized Tariff Schedule of the United States as promulgated by the U.S. International Trade Commission;

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00272 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

263

U.S. Customs and Border Protection, DHS; Treasury § 10.510

(j) Indirect material. ‘‘Indirect mate- rial’’ means a good used in the produc- tion, testing, or inspection of a good in the territory of the United States or Singapore but not physically incor- porated into the good, or a good used in the maintenance of buildings or the op- eration of equipment associated with the production of a good in the terri- tory of the United States or Singapore, including:

(1) Fuel and energy; (2) Tools, dies, and molds; (3) Spare parts and materials used in

the maintenance of equipment and buildings;

(4) Lubricants, greases, compounding materials, and other materials used in production or used to operate equip- ment and buildings;

(5) Gloves, glasses, footwear, cloth- ing, safety equipment, and supplies;

(6) Equipment, devices, and supplies used for testing or inspecting the good;

(7) Catalysts and solvents; and (8) Any other goods that are not in-

corporated into the good but whose use in the production of the good can rea- sonably be demonstrated to be a part of that production;

(k) Originating. ‘‘Originating’’ means qualifying for preferential tariff treat- ment under the rules of origin set out in SFTA Chapter Three (Rules of Ori- gin) and General Note 25, HTSUS;

(l) Party. ‘‘Party’’ means the United States or the Republic of Singapore;

(m) Person. ‘‘Person’’ means a nat- ural person or an enterprise;

(n) Preferential tariff treatment. ‘‘Pref- erential tariff treatment’’ means the duty rate applicable under the SFTA to an originating good, and an exemption from the merchandise processing fee;

(o) Subheading. ‘‘Subheading’’ means the first six digits in the tariff classi- fication number under the Harmonized System;

(p) Tariff preference level. ‘‘Tariff pref- erence level’’ means a quantitative limit for certain non-originating tex- tiles and textile apparel goods that may be entitled to preferential tariff treatment based on the goods meeting the production requirements set forth in § 10.521 of this subpart;

(q) Textile or apparel good. ‘‘Textile or apparel good’’ means a good listed in the Annex to the Agreement on Tex-

tiles and Clothing (commonly referred to as ‘‘the ATC’’), which is part of the WTO Agreement;

(r) Territory. ‘‘Territory’’ means: (1) With respect to Singapore, its

land territory, internal waters and ter- ritorial sea as well as the maritime zones beyond the territorial sea, in- cluding the seabed and subsoil over which the Republic of Singapore exer- cises sovereign rights or jurisdiction under its national laws and inter- national law for the purpose of explo- ration and exploitation of the natural resources of such areas; and

(2) With respect to the United States; (i) The customs territory of the

United States, which includes the 50 states, the District of Columbia, and Puerto Rico;

(ii) The foreign trade zones located in the United States and Puerto Rico; and

(iii) Any areas beyond the territorial seas of the United States within which, in accordance with international law and its domestic law, the United States may exercise rights with respect to the seabed and subsoil and their natural re- sources; and

(s) WTO Agreement. ‘‘WTO Agree- ment’’ means the Marrakesh Agreement Establishing the World Trade Organiza- tion of April 15, 1994.

IMPORT REQUIREMENTS

§ 10.510 Filing of claim for preferential tariff treatment upon importation.

(a) Claim. An importer may make a claim for SFTA preferential tariff treatment, including an exemption from the merchandise processing fee, based on the importer’s knowledge or information in the importer’s posses- sion that the good qualifies as an origi- nating good. For goods that qualify as originating goods under the Integrated Sourcing Initiative (see subdivisions (b)(ii) and (m) of General Note 25, HTSUS, and § 10.532 of this subpart), the claim is made by including on the entry summary, or equivalent docu- mentation, the tariff item 9999.00.84, HTSUS, or by the method specified for equivalent reporting via an authorized electronic data interchange system. For all other qualifying goods, the claim is made by including on the

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00273 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

264

19 CFR Ch. I (4–1–12 Edition)§ 10.511

entry summary, or equivalent docu- mentation, the letters ‘‘SG’’ as a prefix to the subheading of the HTSUS under which each qualifying good is classi- fied, or by the method specified for equivalent reporting via an authorized electronic data interchange system.

(b) Corrected claim. If, after making the claim required under paragraph (a) of this section, the importer becomes aware that the claim is invalid, the im- porter must promptly correct the claim and pay any duties that may be due. The importer must submit a state- ment either in writing or via an au- thorized electronic data interchange system to the CBP office where the original claim was filed specifying the correction (see §§ 10.561 and 10.562 of this subpart).

§ 10.511 Supporting statement.

(a) Contents. An importer who makes a claim under § 10.510(a) of this subpart must submit, at the request of the port director, a statement setting forth the reasons that the good qualifies as an originating good, including pertinent cost and manufacturing data. A state- ment submitted to CBP under this paragraph:

(1) Need not be in a prescribed format but must be in writing or must be transmitted electronically pursuant to any electronic means authorized by CBP for that purpose;

(2) Must include the following infor- mation:

(i) The legal name, address, tele- phone, and e-mail address (if any) of the importer of record of the good;

(ii) The legal name, address, tele- phone, and e-mail address (if any) of the responsible official or authorized agent of the importer signing the sup- porting statement (if different from the information required by paragraph (a)(2)(i) of this section);

(iii) The legal name, address, tele- phone, and e-mail address (if any) of the exporter of the good (if different from the producer);

(iv) The legal name, address, tele- phone, and e-mail address (if any) of the producer of the good (if known);

(v) A description of the good for which preferential tariff treatment is claimed, which must be sufficiently de-

tailed to relate it to the invoice and the HS nomenclature;

(vi) The HTSUS tariff classification, to six or more digits, as necessary for the specific change in tariff classifica- tion rule for the good set forth in Gen- eral Note 25(o), HTSUS;

(vii) The applicable rule of origin set forth in General Note 25, HTSUS, under which the good qualifies as an origi- nating good; and

(3) Must include a statement, in sub- stantially the following form:

I certify that: The information on this document is true

and accurate and I assume the responsibility for proving such representations. I under- stand that I am liable for any false state- ments or material omissions made on or in connection with this document;

I agree to maintain and present upon re- quest, documentation necessary to support these representations;

The goods originated or are considered to have originated in the territory of one or more of the Parties, and comply with the or- igin requirements specified for those goods in the United States-Singapore Free Trade Agreement; there has been no further pro- duction or any other operation outside the territories of the parties, other than unload- ing, reloading, or any other operation nec- essary to preserve the goods in good condi- tion or to transport the goods to the United States; and

This document consists of lll pages, in- cluding all attachments.’’

(b) Responsible official or agent. The supporting statement required to be submitted under paragraph (a) of this section must be signed and dated by a responsible official of the importer or by the importer’s authorized agent having knowledge of the relevant facts.

(c) Language. The supporting state- ment required to be submitted under paragraph (a) of this section must be completed in the English language.

(d) Applicability of supporting state- ment. The supporting statement re- quired to be submitted under para- graph (a) of this section may be appli- cable to:

(1) A single importation of a good into the United States, including a sin- gle shipment that results in the filing of one or more entries and a series of shipments that results in the filing of one entry; or

(2) Multiple importations of identical goods into the United States that

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00274 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150

265

U.S. Customs and Border Protection, DHS; Treasury § 10.514

occur within a specified blanket period, not exceeding 12 months, set out in the statement. For purposes of this para- graph, ‘‘identical goods’’ means goods that are the same in all respects rel- evant to the particular rule of origin that qualifies the goods as originating.

§ 10.512 Importer obligations.

(a) General. An importer who makes a claim under § 10.510(a) of this subpart is responsible for the truthfulness of the claim and of all the information and data contained in the supporting state- ment provided for in § 10.511 of this sub- part, for submitting any supporting documents requested by CBP, and for the truthfulness of the information contained in those documents. How- ever, an importer will not be subject to civil or administrative penalties under 19 U.S.C. 1592 for making an invalid claim for preferential tariff treatment or submitting an incorrect supporting statement, provided that the importer promptly and voluntarily corrects the claim or supporting statement and pays any duty owing (see §§ 10.561 and 10.562 of this subpart). In instances in which CBP requests the submission of supporting documents, CBP will allow for the direct submission by the ex- porter or producer of business confiden- tial or other sensitive information, in- cluding cost and sourcing information.

(b) Compliance. In order to make a claim for preferential tariff treatment under § 10.510(a) of this subpart, the im- porter:

(1) Must have records that explain how the importer came to the conclu- sion that the good qualifies for pref- erential tariff treatment. Those records must include documents that support a claim that the article in question qualifies for preferential tariff treatment because it meets the appli- cable rules of origin set forth in Gen- eral Note 25, HTSUS, and in this sub- part. Those records may include a properly completed importer’s sup- porting statement as set forth in § 10.511 of this subpart; and

(2) May be required to present evi- dence that the conditions set forth in § 10.542 of this subpart were met if the imported article was shipped through an intermediate country.

(c) Information provided by exporter or producer. The fact that the importer has made a claim or supporting state- ment based on information provided by an exporter or producer will not relieve the importer of the responsibility re- ferred to in the first sentence of para- graph (a) of this section.

§ 10.513 Supporting statement not re- quired.

(a) General. Except as otherwise pro- vided in paragraph (b) of this section, an importer will not be required to sub- mit a supporting statement under § 10.511 of this subpart for:

(1) A non-commercial importation of a good; or

(2) A commercial importation for which the value of the goods does not exceed U.S. $2,500.

(b) Exception. If the port director de- termines that an importation described in paragraph (a) of this section may reasonably be considered to have been carried out or planned for the purpose of evading compliance with the rules and procedures governing claims for preference under the SFTA, the port director will notify the importer that for that importation the importer must submit to CBP a supporting statement. The importer must submit such a statement within 30 days from the date of the notice. Failure to timely submit the supporting statement will result in denial of the claim for preferential treatment.

§ 10.514 Maintenance of records. (a) General. An importer claiming

preferential tariff treatment for a good imported into the United States under § 10.510(a) of this subpart must main- tain, for five years after the date of im- portation of the good, any records and documents that the importer has relat- ing to the origin of the good, including records and documents associated with:

(1) The purchase of, cost of, value of, and payment for, the good;

(2) Where appropriate, the purchase of, cost of, value of, and payment for, all materials, including recovered goods and indirect materials, used in the production of the good; and

(3) Where appropriate, the production of the good in the form in which the good was exported.

VerDate Mar<15>2010 16:45 Jun 06, 2012 Jkt 226060 PO 00000 Frm 00275 Fmt 8010 Sfmt 8010 Q:\19\19V1.TXT ofr150 PsN: PC150