[Senate Treaty Document 108-6]
[From the U.S. Government Publishing Office]



108th Congress                                              Treaty Doc.
 1st Session                     SENATE                     108-6
_______________________________________________________________________
 
 PROTOCOL OF AMENDMENT TO INTERNATIONAL CONVENTION ON SIMPLIFICATION 
                AND HARMONIZATION OF CUSTOMS PROCEDURES

                               __________

                                MESSAGE

                                  from

                   THE PRESIDENT OF THE UNITED STATES

                              transmitting

     PROTOCOL OF AMENDMENT TO THE INTERNATIONAL CONVENTION ON THE 
SIMPLIFICATION AND HARMONIZATION OF CUSTOMS PROCEDURES DONE AT BRUSSELS 
                            ON JUNE 26, 1999




April 30, 2003.--The Treaty was read the first time, and together with 
the accompanying papers, referred to the Committee on Foreign Relations 
          and ordered to be printed for the use of the Senate
                         LETTER OF TRANSMITTAL

                              ----------                              

                                   The White House, April 30, 2003.
To the Senate of the United States:
    I transmit herewith for Senate advice and consent to 
accession, the Protocol of Amendment to the International 
Convention on the Simplification and Harmonization of Customs 
Procedures done at Brussels on June 26, 1999. The Protocol 
amends the International Convention on the Simplification and 
Harmonization of Customs Procedures done at Kyoto on May 18, 
1973, and replaces the Annexes to the 1973 Convention with a 
General Annex and 10 Specific Annexes (together, the ``Amended 
Convention''). I am also transmitting, for the information of 
the Senate, the report of the Department of State on the 
Amended Convention.
    The Amended Convention seeks to meet the needs of 
international trade and customs services through the 
simplification and harmonization of customs procedures. It 
responds to modernization in business and administrative 
methods and techniques and to the growth of international 
trade, without compromising standards of customs control. 
Accession by the United States would further the U.S. interest 
in reducing non-tariff barriers to international trade.
    By acceding to the Protocol, a state consents to be bound 
by the amended 1973 Convention and the new General Annex. At 
the same time, or anytime thereafter, Parties have the option 
of accepting any of the Specific Annexes (or Chapters thereof), 
and may at that time enter reservations with respect to any 
Recommended Practices contained in the Specific Annexes. In 
accordance with these terms, I propose that the United States 
accept seven of the Specific Annexes in their entirety and all 
the Chapters, but one of each of two other Specific Annexes (A-
E, G, and H, as well as Chapters 1, 2, and 3 of F, and Chapters 
1, 3, 4, and 5 of J), and enter the reservations proposed by 
the Bureau of Customs and Border Protection as set forth in the 
enclosure to the report of the Department of State. The 
provisions for which reservation is recommended conflict with 
current U.S. legislation or regulations. With these proposed 
reservations, no new implementing legislation is necessary in 
order to comply with the Amended Convention.
    Accession to the Protocol by the United States would 
contribute to important U.S. interests. First, accession by the 
United States would benefit the United States and U.S. 
businesses by facilitating greater economic growth, increasing 
foreign investment, and stimulating U.S. exports through more 
predictable, standard, and harmonized customs procedures 
governing cross-border trade transactions. Setting forth 
standardized and simplified methods for conducting customs 
business is important for U.S. trade interests in light of the 
demands of increased trade flows, as is the use of modernized 
technology and techniques for customs facilitation. These 
achievements can best be pursued by the United States as a 
Party to the Amended Convention. Second, through early 
accession, the United States can continue to take a leadership 
role in the areas of customs and international trade 
facilitation as the U.S. accession would encourage other 
nations, particularly developing nations, to accede as well.
    I recommend that the Senate give early and favorable 
consideration to the Protocol and give its advice and consent 
to accession.

                                                    George W. Bush.
    The White House, April 30, 2003.
                          LETTER OF SUBMITTAL

                              ----------                              

                                       Department of State,
                                      Washington, February 6, 2003.
The President,
The White House.
    The President: I have the honor to submit to you the 
Protocol of Amendment to the International Convention on the 
Simplification and Harmonization of Customs Procedures done at 
Brussels on June 26, 1999. The Protocol amends the 
International Convention on the Simplification and 
Harmonization of Customs Procedures done at Kyoto on May 18, 
1973 (the ``original Convention''), which entered into force 
for the United States on January 28, 1984. The Secretary of the 
Treasury and I recommend that the Protocol be transmitted to 
the Senate for its advice and consent to accession, including 
nine of its Specific Annexes, subject to certain U.S. 
reservations. The proposed text of these reservations is 
enclosed.
    The original Convention entered into force in 1974 and 
currently has 62 Parties, which include many of the largest 
U.S. trading partners. The United States acceded to the 
original Convention in October 1983. However, recent changes in 
technology and patterns of international trade have made the 
original Convention outdated. In addition, the original 
Convention is not sufficiently comprehensive, requiring 
acceptance of only one of its 31 Annexes in order for a state 
or eligible customs union to become a Party. The United States 
took an active role in negotiating the Protocol in order to 
produce the kind of modernization and customs harmonization 
that is becoming increasingly necessary to U.S. exporters and 
other traders alike. The revision process also included 
participation by the private sector through various groups such 
as the International Chamber of Commerce, the International 
Federation of Brokers Association and the International Express 
Couriers Conference. On June 26, 1999, after 4 years of study 
and deliberation, the Protocol was adopted by the members of 
the World Customs Organizations (formerly known as the Customs 
Cooperation Council) in Brussels, Belgium.
    The Protocol amends the original Convention and replaces 
the Annexes of the original Convention with a General Annex and 
with 10 Specific Annexes (together, the Amended Convention). By 
acceding to the Protocol a state consents to be bound by the 
amended 1973 original Convention (Appendix I to the Protocol) 
and the General Annex (Appendix II to the Protocol). At the 
same time, or anytime thereafter, Parties have the option of 
accepting any of the Specific Annexes (Appendix III to 
theProtocol), or Chapters therein (each Chapter contains Standards and 
Recommended Practices), and may enter reservations with respect to any 
Recommended Practices.
    The Amended Convention is designed to enable Parties to 
better meet the needs of much expanded international trade 
through the simplification and harmonization of customs 
procedures. It responds to the modernization of business and 
administrative methods and techniques and to the growth of 
international trade, without compromising standards of customs 
control. The amended Convention recognizes that simplification 
and harmonization of customs procedures can be accomplished by 
applying, inter alia, the following principles: continuous 
modernization of customs procedures; predictable, consistent 
and transparent application of customs procedures; availability 
of information on customs laws, regulations, guidelines and 
practices; adoption of modern techniques such as risk 
management, audit based controls and the maximum use of 
information technology; cooperation of relevant international 
standards; and a transparent system of administrative and 
judicial review of customs decisions.
    The General Annex contains 10 Chapters that encompass 
standards applicable to all customs procedures and practices 
covered by the Amended Convention and that must be observed by 
all Parties to the Amended Convention. In particular, General 
Annex Chapters 1 and 2 contain general principles and 
definitions. Chapter 3 sets forth standards on clearance and 
other customs formalities. Chapter 4 sets forth standards on 
assessment and collection and payment of duties and taxes, 
while Chapter 5 concerns security to ensure fulfillment of a 
customs-related obligation. Chapter 6 sets forth standards for 
customs control such as use of risk management. Chapter 7 
focuses on the application of information technology to support 
customs operations. Chapter 8 relates to rights of third 
parties representing others before customs services, and 
Chapter 9 addresses the availability of information on customs 
matters. Chapter 10 concerns appeals in customs matters. The 
Chapters of the General Annex contain Standards and 
Transitional Standards. However, pursuant to Article 13 of the 
Amended Convention, a Party has 36 months from the time the 
General Annex has entered into force for that Party within 
which to implement the provisions contained in a Standard and 
60 months within which to implement the provisions of a 
Transitional Standard.
    In addition to the General Annex there are 10 Specific 
Annexes (enumerated A-K, although there is no Specific Annex 
I), which contain provisions applicable to one or more of 
theindividual customs procedures and practices referred to in the 
Amended Convention. Pursuant to Article 4 of the Protocol and Article 
12 of the Amended Convention, a Party may accept one or more of the 
Specific Annexes or one or more of the Chapters that compose a Specific 
Annex. Each Specific Annex Chapter includes both Standards and 
Recommended Practices (and may also contain specialized definitions). 
In particular, Specific Annex A concerns the arrival of goods in a 
customs territory and addresses formalities prior to the lodgment of 
the Goods Declaration as well as temporary storage of goods. Specific 
Annexes B and C address general customs procedures related to 
importation and exportation. Specific Annex D deals with customs 
warehouses and free zones. Specific Annex E concerns transit of goods. 
Specific Annex F focuses on goods imported or exported for processing, 
while Specific Annex G concerns temporary admission. Specific Annex H 
relates to customs services' approaches (and due process matters) 
related to branches of customs law. Specific Annex J describes special 
customs procedures pertaining to, among other things, travelers, postal 
traffic and processing of aid consignments for disasters. Finally, 
Specific Annex K concerns rules of origin. By accepting a Specific 
Annex or Chapter(s) of a Specific Annex a Party is bound by all the 
Standards and Recommended Practices found therein, unless, pursuant to 
Article 4 of the Protocol and Article 12 of the Amended Convention, a 
Party enters reservations in respect of Recommended Practices (but not 
Standards) in a Specific Annex it has accepted to accommodate 
differences in its national legislation (defined in Article 1 of the 
Amended Convention to include laws, regulations and other measures).
    It is proposed that the United States accept seven of the 
Specific Annexes in their entirety and all the Chapters but one 
of each of two other Specific Annexes (A-E, G, and H, as well 
as Chapters 1, 2, and 3 of F and Chapters 1, 3, 4, and 5 of J), 
subject to the enclosed reservations proposed by the U.S. 
Customs Service. By not accepting Specific Annex F Chapter 4 
and Specific Annex J Chapter 2, which contain Standards 
inconsistent with U.S. law, and with the proposed reservations, 
no new implementing legislation would be necessary. The tenth 
Specific Annex (Specific Annex K) deals with rules of origin, 
which the United States is not seeking to accept at this time 
as the harmonization work between the World Customs 
Organization and the World Trade Organization on this issue is 
not yet completed. Under Article 12(3) of the Amended 
Convention, the United States would be obligated periodically 
to review the provisions of the Amended Convention for which it 
has enteredreservations to consider the possibility of 
withdrawing any of its reservations and to notify the Secretary of the 
World Customs Organization of the results of that review.
    The Protocol will enter into force 3 months after 40 
contracting parties have consented to be bound by it. To date, 
the following countries have consented to be bound: Algeria, 
Australia, Canada, China, the Czech Republic, Japan, Latvia, 
Lesotho, Morocco, New Zealand and Uganda.
    A customs or economic union, which has competence to adopt 
its own regulations on matters governed by the Amended 
Convention that are binding on its member states, may become a 
Party to the Protocol. Pursuant to Article 8(5) of Appendix I, 
such union shall inform the Depositary of its competence with 
respect to matters governed by the Amended Convention. Pursuant 
to Article 8(5) of Appendix I, such a union shall, for matters 
within its competence, exercise in its own name the rights, and 
fulfill the responsibilities which the Amended Convention 
confers on union members that are Parties. In such cases, these 
union members shall not be entitled to individually exercise 
these rights, including the right to vote. Therefore, the 
European Community (EC), were it to become a Party, could only 
exercise in its own name the right to vote of those EC members 
that are parties to the Amended convention. The EC would not 
have a vote in addition to those of its member states that are 
Parties. Though such unions were eligible to be Parties to the 
original Convention--and the EC is a Party to the original 
Convention--they were not entitled to vote under the original 
Convention.
    The United States, by acceding to the Protocol, can 
continue to take a leadership role in the areas of customs and 
international trade facilitation. Accession by the United 
States to the Protocol is also significant because it will 
encourage other nations, particularly developing nations, to 
accede as well. The U.S. accession would benefit the United 
States and U.S. businesses directly by facilitating greater 
economic growth, increased foreign investment and stimulation 
of U.S. exports through more predictable, standard and 
harmonized customs procedures governing cross-borders trade 
transactions. The Amended Convention embodies standardized 
global trade processes and data standards that are critical for 
fast, efficient and reliable delivery of U.S. products 
overseas. The standardized processes in the Amended Convention 
would not only enhance the ability of U.S. businesses to 
deliver to their current customers, but would expand export 
markets and access to new customers and new partners in the 
global economy.
    The Amended Convention would also advance U.S. interests in 
reducing non-tariff barriers to international trade. The U.S. 
Department of the Treasury, the U.S. Customs Service and the 
U.S. Inter-Agency Committee on the Customs Cooperation Council 
concur in my recommendation that the Protocol be submitted to 
the Senate for its consideration and advice and consent to 
accession.
            Respectfully submitted,
                                                   Colin L. Powell.
    Enclosure: As stated.
    
    
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