[Federal Register Volume 59, Number 112 (Monday, June 13, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-14255]


[[Page Unknown]]

[Federal Register: June 13, 1994]


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DEPARTMENT OF THE TREASURY

Customs Service

19 CFR Parts 10, 101, 111, 123, 128, 141, 143, 145, 148, 159

[T.D. 94-51]
RIN 1515-AB53

 

Express Consignments; Formal and Informal Entries of Merchandise; 
Administrative Exemptions

AGENCY: U.S. Customs Service, Department of the Treasury.

ACTION: Interim regulations; solicitation of comments.

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SUMMARY: The amendments contained in this document are being published 
as interim regulations to implement certain statutory amendments to the 
Customs laws regarding administrative exemptions. These statutory 
amendments are contained in the Customs modernization provisions of the 
North American Free Trade Agreement Implementation Act. Also, the 
interim regulations clarify the procedures for shipments brought into 
the United States by express consignment operators or carriers and make 
clear that all shipments carried into the United States by express 
consignment operators or carriers are required to be entered, unless 
specifically exempt from entry. These interim regulations also 
implement the Customs modernization provisions in the North American 
Free Trade Agreement Implementation Act exempting from entry certain 
merchandise (undeliverable shipments, railway freight locomotives and 
cars, and instruments of international traffic).

DATES: Interim rule effective July 28, 1994; comments must be received 
on or before July 13, 1994.

ADDRESSES: Written comments (preferably in triplicate) must be 
submitted to U.S. Customs Service, ATTN: Regulations Branch, Franklin 
Court, 1301 Constitution Avenue, NW., Washington, DC 20229, and may be 
inspected at the Regulations Branch, 1099 14th Street, NW., suite 4000, 
Washington, DC.

FOR FURTHER INFORMATION CONTACT: William G. Rosoff, Office of 
Regulations and Rulings, (202-482-7040).

SUPPLEMENTARY INFORMATION:

Background

    On December 8, 1993, the President signed into law Public Law 103-
182, the North American Free Trade Agreement Implementation Act (107 
Stat. 2057). Title VI of this Act, popularly known as the Customs 
Modernization Act (the Act) amended certain Customs laws. Section 651 
of the Act amended section 321, Tariff Act of 1930, as amended (19 
U.S.C. 1321).
    Before its amendment by the Act, section 321 authorized 
administrative exemptions from duty and taxes on articles such as gifts 
and personal and household goods, and in certain other situations. 
Specifically, section 321 authorized the Secretary of the Treasury, in 
order to avoid expense and inconvenience to the Government 
disproportionate to the amount of revenue that would otherwise be 
collected, to disregard a difference of less than $10 between the duty 
actually due on an entry and the estimated duties deposited. On the 
same basis, section 321 authorized the Secretary to admit free of duty 
and tax any article the value of which was less than $50 in the case of 
bona fide gifts ($100 if the gift was from certain island possessions) 
sent from persons in foreign countries to persons in the United States. 
Section 321 authorized the Secretary to admit free of duty and tax any 
article the value of which was less than $25 in the case of personal or 
household articles accompanying the traveler. In all other cases (i.e., 
if not a bona fide gift sent from a person in a foreign country to a 
person in the United States or a personal or household article 
accompanying a traveler), the Secretary was authorized to admit free of 
duty and tax any article the value of which was less than $5.
    In the last three cases (i.e., bona fide gifts, personal or 
household articles, and all other cases), the exemptions were subject 
to the condition that the aggregate fair retail value in the country of 
shipment of articles imported by one person on one day could not exceed 
the authorized amount. Also, the exemptions in these cases were not to 
be granted in any case in which merchandise covered by a single order 
or contract was forwarded in separate lots to secure the benefit of the 
provision.
    The Secretary was authorized to prescribe regulations to implement 
these provisions. Section 321 specifically authorized the Secretary to 
diminish any of the dollar amounts referred to above.
    Section 651 of the Act increased the dollar amounts described and, 
instead of setting maximum dollar amounts below which the Secretary was 
authorized to make the exemptions applicable, authorized the Secretary 
to make the exemptions applicable to an amount to be specified in 
regulations, but not less than a stated amount. That is, the amended 
section 321 now provides minimum dollar amounts for the exemptions.
    In the case of the difference between duty actually due on an entry 
and the estimated duties deposited, the dollar amount was increased to 
a minimum of $20. Also, this provision was changed to authorize Customs 
to apply the exemption to the total of duties, fees, and taxes, instead 
of only duties and taxes, as had been the case. In the case of bona 
fide gifts, personal or household articles, and all other cases, the 
dollar amounts were respectively increased to $100 ($200, if the gift 
is from one of the named island possessions), $200, and $200, 
respectively.
    Section 651 removed from Sec. 321 the specific authorization to, by 
regulation, diminish any of the dollar amounts specified in the 
provision. Section 651 retained the specific authorization in section 
321 for regulations to prescribe exceptions to any exemption whenever 
the Secretary finds such action is consistent with the purpose of the 
provisions or is necessary to protect the revenue or to prevent 
unlawful importations.
    The provision in the Customs Regulations containing the 
authorization to disregard a difference of less than $10 between the 
duty actually due on an entry and the estimated duties deposited is 
found in 19 CFR 159.6. The provisions in the Customs Regulations 
pertaining to the administrative exemption for bona fide gifts are 
found in 19 CFR 10.152 and 145.32 and the provision for personal or 
household articles is found in 19 CFR 148.51 (see also Secs. 148.12, 
148.64). The provisions in the Customs Regulations pertaining to the $5 
administrative exemption for all other articles are found in 19 CFR 
10.151 and 145.31. Conditions for the exemptions provided for in 19 CFR 
10.151 and 10.152 are currently found in 19 CFR 10.153.
    Provisions pertaining to the administrative exemptions under 
section 321 are also found in part 128 of the Customs Regulations, 
which relates to express consignments. Section 128.24(d) of that part 
refers to low value shipments (i.e., shipments valued at $5 or less) 
and provides that such shipments must be segregated from shipments 
valued at more than $5 when the special informal entry procedures 
provided for in part 128 are used. This provision was intended to cover 
articles which could be administratively exempted from duties and taxes 
under section 321(a)(2)(C) (see T.D. 89-53, published in the Federal 
Register on May 8, 1989 (54 FR 19561)).
    These interim regulations conform the Customs Regulations to the 
changes made to section 321 by section 651 of the Act. In addition, the 
interim regulations clarify entry procedures applicable to merchandise 
subject to section 321. The dollar amounts currently provided for in 19 
CFR 10.151 through 10.153, 145.31, 145.32, 148.12, 148.51, 148.64 and 
159.6 are changed to the minimums provided for in the amended section 
321.
    The interim regulations amend part 143 to clarify the procedures 
for entries of shipments qualifying for the administrative exemptions 
in section 321(a)(2). Shipments covered in section 321(a)(2) are 
included in the merchandise which may be entered under the procedures 
provided for by regulation under 19 U.S.C. 1498. That provision 
authorizes the Secretary of the Treasury to prescribe rules and 
regulations for the declaration and entry of the merchandise described 
in the section. Entries which may be provided for by regulation under 
section 1498 are distinguished from entries which are required to be 
filed under 19 U.S.C. 1484 (i.e., formal entries). As authorized by 
section 1498, these amendments provide that the person who may make 
entry of shipments covered by section 321(a)(2) is the owner, 
purchaser, or consignee of the merchandise or, when appropriately 
designated by one of these persons, a Customs broker licensed under 19 
U.S.C. 1641. Under the same authority, an amendment to part 143 makes 
it clear that the person who may make entry of other merchandise (i.e., 
merchandise not qualifying for the administrative exemptions in section 
321(a)(2)) which qualifies for informal entry is the owner or purchaser 
of the merchandise or, when appropriately designated by the owner, 
purchaser, or consignee of the merchandise, a Customs broker licensed 
under 19 U.S.C. 1641.
    A corresponding amendment to part 111, concerning Customs brokers, 
is added to the list of transactions for which a broker's license is 
not required. The new provision provides that a person entering 
merchandise qualifying for and entered under the informal entry 
procedures authorized by 19 U.S.C. 1498 is not required to be licensed 
as a broker unless required to be so licensed by regulations issued 
under the authority of section 1498. A reference to the provision 
included in part 143 is included in the new provision.
    Also under the authority of 19 U.S.C. 1498, amendments are made to 
part 143 to clearly provide the procedures for entries of the 
merchandise covered in section 321(a)(2). Shipments of such merchandise 
may be entered by presenting the bill of lading (or a manifest listing 
each bill of lading) or other document used to file or support entry. 
Manifest information is required consisting of the country of origin of 
the merchandise, shipper name, address and country, ultimate consignee 
name and address, specific description of the merchandise, quantity, 
and value. Cross references are provided to section Secs. 148.12 and 
148.62 to make it clear that entry by oral declaration continues to be 
allowed.
    No amendment to the regulations is being promulgated at this time 
to implement the new subsection (a)(3) of section 321, added by section 
651 of the Act. This provision allows Customs to waive the collection 
of duties, fees, and taxes due on entered merchandise when such duties, 
fees, or taxes are less than $20, in order to avoid expense and 
inconvenience to the Government disproportionate to the amount of 
revenue that would otherwise be collected. Regulations implementing 
this provision are being delayed pending an analysis of the expense and 
inconvenience to the Government in view of the revenue involved.
    Section 159.6, authorizing Customs to disregard a difference of 
less than $10 (now $20 under the amended section 321(a)(1)) between 
duties deposited and duties actually due on an entry, is amended to 
authorize Customs to apply the exemption to the total of duties, fees, 
and taxes, as provided for in section 321(a)(1), as amended by section 
651 of the Act.
    Customs also is making amendments to the Customs Regulations in 
part 128 relating to express consignments. These amendments are 
intended to make it clear that all shipments carried into the United 
States by express consignment operators and carriers are required to be 
entered, unless specifically exempt from entry.
    Basically, a 3-tier approach applies to such shipments. That is, 
shipments valued in excess of $1250 are required to be formally 
entered, as provided for under 19 U.S.C. 1484 in parts 141, 142, and 
143 (except subpart C) of the Customs Regulations. Shipments valued 
between $200 and $1250 may be entered under the informal entry 
procedures, as provided for under 19 U.S.C. 1498 (unless the shipments 
consist of merchandise which may not be entered under those 
procedures). These procedures consist of the filing of a Customs Form 
3461, either modified to cover all importations under the special 
procedures for express consignment operator or carrier importations or 
all such importations on a daily or flight basis, and the advance 
filing of the manifest information provided for in 19 CFR 128.21. This 
information consists of the country of origin, shipper name, address 
and country, ultimate consignee name and address, specific description 
of the merchandise and the tariff classification of the merchandise, 
quantity, shipping weight, and value. An entry summary (Customs Form 
7501) and estimated duties are required to be filed with Customs within 
10 days of release of these shipments.
    The third tier is for shipments valued at $200 or less. These 
shipments also may be entered under the informal entry procedures, as 
provided for under 19 U.S.C. 1498 (unless the shipments consist of 
merchandise which may not be entered under those procedures). The 
procedures for these shipments are the same as those for the second-
tier shipments (valued between $200 and $1250), except that the tariff 
classification of the merchandise is not required for the shipments and 
no entry summary or estimated duties is required to be filed.
    An amendment to 19 CFR 101.1, adding a definition of ``shipment'', 
makes it clear that the monetary exemption for third-tier shipments is 
based on the bill of lading or other evidence used to file or support 
entry, or oral declaration when applicable. For example, if the 
document used to file or support entry is an individual bill of lading 
to the ultimate consignee in the United States, the monetary limitation 
is applied on the basis of the value of the shipment on the individual 
bill of lading. This is so whether the document used to file or support 
entry is itself the bill of lading or an advance manifest, as described 
in 19 CFR 128.21, listing each of the individual bills of lading. On 
the other hand, if the document used to file or support entry is a 
master bill of lading (as opposed to each individual bill of lading), 
the monetary limitation is applied on the basis of the total value of 
the shipments on the master bill of lading. The same is true of the 
application of the monetary limitation in section 321(a)(2) for other 
importations (i.e., those not involving an express consignment entity). 
This is so because the definition of ``shipment'' is for general 
purposes in chapter I of title 19 of the CFR, unless the context of the 
term requires a different meaning (see 19 CFR 101.1).
    As is true generally under these amendments, the person who may 
make entry for the shipments valued between $200 and $1250 which may be 
entered under the informal entry procedures is the owner or purchaser 
of the shipment or, when appropriately designated by the owner, 
purchaser, or consignee of the shipment, a Customs broker licensed 
under 19 U.S.C. 1641. The person who may make entry for the shipments 
valued $200 or less which may be entered under the informal entry 
procedures is the owner, purchaser, or consignee or, when appropriately 
designated by one of these persons, a Customs broker licensed under 19 
U.S.C. 1641. As discussed above, the authority for this distinction is 
that these entries are made under 19 U.S.C. 1498 and the Secretary of 
the Treasury is specifically authorized to prescribe rules and 
regulations for the declaration and entry of such shipments.
    Amendments are also made to part 141. Section 141.4 is amended to 
clarify that shipments subject to the administrative exemptions under 
Sec. 321(a)(2) must be entered under special informal entry procedures 
for lower value shipments. Only merchandise specifically exempt from 
entry (i.e., so-called intangibles, under General Note 13 (formerly 
General Note 4), HTSUS, and certain vessels) is exempt from all forms 
of entry. Also, a conforming amendment to the citation of the General 
Note in Sec. 141.4 is necessary because of the redesignation of the 
General Note (i.e., General Note 4, HTSUS, the predecessor to General 
Note 13, was redesignated as General Note 13; see Presidential 
Proclamation 6641, December 15, 1993, published in the Federal Register 
on December 20, 1993 (58 FR 67032, 66867)).

Undeliverable Shipments

    The North American Free Trade Agreement Implementation Act amended 
General Note 4 (now General Note 13) by adding other articles which are 
exempt from entry (section 681 of Pub. L. 103-182). The newly added 
articles are articles which are returned as undeliverable to the United 
States within 45 days of their departure from the United States. The 
articles may not have left the custody of either the carrier or foreign 
customs service during that time. The departure from the United States 
of articles for which the exemption is granted may not be treated as 
satisfying any requirement for exportation in order to receive a 
benefit from, or meet an obligation to, the United States.
    The amendment to Sec. 141.4 implements this provision. The 
amendment requires the person claiming the exemption to certify that 
the merchandise complies with the provision. In addition, the amendment 
requires the person claiming the exemption to provide, upon request by 
Customs, any evidence necessary to support the claim.

Other Exemptions From Entry

    Section 681 of the Act also added a provision to the tariff 
schedule exempting from entry and release requirements railway 
locomotives (provided for in headings 8601 and 8602, HTSUS) and railway 
freight cars (provided for in heading 8606, HTSUS) on which no duty is 
owed (Additional U.S. Note 1, Chapter 86, HTSUS). Also, section 681 of 
the Act provided for the addition of a Note to Chapter 99, HTSUS, under 
which certain Canadian railway freight cars provided duty-free 
treatment in subheadings 9905.86.05 and 9905.86.10, HTSUS, are exempt 
from entry and release requirements. The railway freight cars provided 
for in subheading 9905.86.05, HTSUS, are those produced before July 1, 
1991, or if entered after July 1, 1994, produced not less than 3 years 
before the date of importation, and provided for in heading 8606, 
HTSUS. The railway freight cars provided for in subheading 9905.86.10, 
HTSUS, are those imported for temporary use in transportation in the 
United States and certified by the importer to be exported within 1 
year from the date of importation and provided for in heading 8606, 
HTSUS. In the case of both Notes (to be added to chapter 86 and 99, 
HTSUS), the Secretary of the Treasury is authorized by regulation to 
establish appropriate reporting requirements and to require that a bond 
be posted to ensure compliance.
    The amendment to Sec. 141.4 implements these provisions. In the 
case of railway locomotives and freight cars which are exempt from 
entry on the basis that no duty is owed on them and they are classified 
in headings 8601, 8602, or 8606, HTSUS (i.e., without reference to 
subheading 9905.86.05 or 9905.86.10, HTSUS), no special evidentiary 
requirement is imposed because duty-free treatment is not conditioned 
on any special condition (other than duty-free status because of 
origin).
    In the case of railway freight cars which are exempt from entry by 
virtue of subheading 9905.86.05 or 9905.86.10, HTSUS, because there are 
conditions other than the absence of duty being owed on the freight 
cars, the amendment contains special evidentiary requirements. The 
requirements, concerning the time of production of the freight car and 
the duration of the stay in the United States of the freight car, shall 
be met by a certification (documentary or electronic), subject to 
Customs verification. In the case of the requirement to export the 
freight car within 1 year from the date of importation, in subheading 
9905.86.10, HTSUS, the amendment specifically provides that a freight 
car admitted into the United States under this provision which is not 
exported within the 1 year period becomes subject to entry and the 
payment of any applicable duties.
    As authorized by the statutory provision, the amendment provides 
that locomotives and freight cars described in Additional U.S. Note 1 
of Chapter 86, HTSUS, and freight cars described in subheading 
9905.86.05 or 9905.86.10, HTSUS, may be released only after the 
importer has filed a bond on Customs Form 301, containing either the 
basic importation and entry conditions (19 CFR 113.62) or the 
international carrier bond conditions (19 CFR 113.64). Amendments to 19 
CFR 123.12 are added concerning the entry of foreign locomotives and 
equipment in international traffic, to add references to the provisions 
implementing these provisions.

Instruments of International Traffic

    Section 681 of the Act added a provision to the tariff schedule 
exempting from formal entry procedures instruments of international 
traffic, such as containers, lift vans, rail cars and locomotives, 
truck cabs and trailers, etc. The provision also provided for the 
periodic reporting and payment of fees associated with the importation 
of such instruments of international traffic.
    The exemption from entry for instruments of international traffic 
is already provided for in the Customs Regulations (see 19 CFR 10.41a). 
There are no fees associated with the importation of instruments of 
international traffic. Therefore, no substantive amendment to the 
Customs Regulations is necessary to implement this provision. However, 
to alert the public to the exemption from entry for instruments of 
international traffic, a provision is added referring to this exemption 
from entry and 19 CFR 10.41a in the list of exceptions from the general 
rule in Sec. 141.4.
    Accordingly, Customs is promulgating on an interim basis amendments 
as described above and set forth below.

Delayed Effective Date and Public Comment Requirements

    The agency intends that these interim regulations become effective 
on the 45th day following the date of publication, i.e., 15 days after 
the close of the comment period. The agency believes it has good cause 
under 5 U.S.C. 553(d) (1) and (3) of the Administrative Procedure Act 
(APA) (5 U.S.C. 553) to promulgate interim regulations because the 
regulations provide an immediate benefit to both the Government and the 
public by increasing exemptions which already exist. These interim 
regulations are intended to implement Congressional intent embodied in 
19 U.S.C. 1321, as amended, that these exemptions, when granted, should 
exist at statutory minimums.
    Furthermore, existing rights and obligations are not otherwise 
changed. The agency believes the public wants these new statutory 
minimums to become effective as soon as possible as the public should 
benefit from the efficiencies and savings resulting therefrom. In 
addition, the agency does not believe the public needs time to conform 
its conduct so as to avoid violation of these regulations. The due and 
timely execution of the agency's responsibilities would be 
unnecessarily impeded by a time consuming notice and comment period. 
The agency believes such delay is unnecessary because it does not 
expect the public to object to the regulations being promulgated as 
they merely provide the relief that Congress intended.
    Even though, based on the discussion set forth above, Customs 
believes the amendments in this document may be promulgated on an 
interim basis and could be effective immediately, Customs is providing 
a 45-day delayed effective date, with a 30 day comment period preceding 
that effective date. This represents a practical compromise between the 
need for temporal urgency and the desirability of public participation 
in the rulemaking process.
    In the spirit of the APA, the agency is soliciting public comment 
regarding its decision to promulgate these interim regulations and in 
delaying their effective date only for that period of time necessary to 
review any relevant comments regarding that decision. Unless the 
comments show that there exists good cause for not making the 
regulations effective on an interim basis, the regulations will become 
effective on an interim basis on the 45th day following the date of 
publication.

Comments

    Consequently, the agency hereby solicits comments on both the 
substance of these regulations and their intended effective date. The 
comments should clearly state whether they address the substance of the 
interim rule or the agency's determination to make the rule effective 
on an interim basis. If, based on the comments, good cause is shown 
that the regulations should not become effective on an interim basis, a 
document will be issued withdrawing the interim regulations before 
their effective date. If no such good cause is shown, the interim 
regulations will go into effect. The agency will then be able to gain 
experience with the interim regulation, fully consider substantive 
comments, and decide whether the interim regulation needs amendment 
before its promulgation as a final rule.
    Consideration will be given to any written comments (preferably in 
triplicate) that are timely submitted to Customs. All such comments 
received from the public pursuant to this notice of rulemaking will be 
available for public inspection in accordance with the Freedom of 
Information Act (5 U.S.C. 552), Sec. 1.4, Treasury Department 
Regulations (31 CFR 1.4), and Sec. 103.11(b), Customs Regulations (19 
CFR 103.11(b)), during regular business days between the hours of 9:00 
a.m. and 4:30 p.m. at the Regulations Branch, 1099 14th Street, NW., 
suite 4000, Washington, DC.

Regulatory Flexibility Act and Executive Order 12866

    Since this document is not subject to the notice and public 
procedure requirements of 5 U.S.C. 553, it is not subject to the 
provisions of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.). 
This document is not a ``significant regulatory action'' under E.O 
12866.

Paperwork Reduction Act

    The collections of information contained in this interim rulemaking 
were previously approved by the Office of Management and Budget (OMB) 
in accordance with the Paperwork Reduction Act of 1980 under control 
numbers 1515-0069 (Secs. 128.21, 128.23, 128.24) and 1515-0065 
(Secs. 141.4, 143.23).

Drafting Information

    The principal author of this document was Russell Berger, 
Regulations Branch, U.S. Customs Service. However, personnel from other 
offices participated in its development.

List of Subjects

19 CFR Part 10

    Alterations, Bonds, Customs duties and inspection, Exports, Foreign 
relations, Imports, Preference programs, Repairs, Reporting and 
recordkeeping requirements, Trade agreements.

19 CFR Part 101

    Customs duties and inspection, Exports, Imports, Organization and 
functions (Government agencies).

19 CFR Part 111

    Administrative practice and procedure, Brokers, Customs duties and 
inspection, Imports.

19 CFR Part 123

    Administrative practice and procedure, Aircraft, Bonds, Canada, 
Customs duties and inspection, Imports, Mexico, Reporting and 
recordkeeping requirements, Trade agreements, Vehicles, Vessels.

19 CFR Part 128

    Carriers, Couriers, Customs duties and inspection, Express 
Consignments, Imports.

19 CFR Part 141

    Customs duties and inspection, Entry procedures, Invoices, 
Reporting and recordkeeping requirements.

19 CFR Part 143

    Automated broker interface, Customs duties and inspection, 
Electronic entry filing, Imports, Invoice requirements.

19 CFR Part 145

    Customs duties and inspection, Imports, Postal Service.

19 CFR Part 148

    Customs duties and inspection, Reporting and recordkeeping 
requirements.

19 CFR Part 159

    Liquidation of entries for merchandise, Suspension of liquidation 
pending disposition of American manufacturer's cause of action.

Amendments

    Title 19, chapter I, parts 10, 101, 111, 123, 128, 141, 143, 145, 
148, and 159 of the Customs Regulations (19 CFR parts 10, 101, 111, 
123, 128, 141, 143, 145, 148 and 159) is amended as set forth below:

PART 10--ARTICLES CONDITIONALLY FREE, SUBJECT TO A REDUCED RATE, 
ETC.

    1. The general authority for part 10 is revised to read as follows, 
and the specific section authority for Secs. 10.152 and 10.153 is 
removed:

    Authority: 19 U.S.C. 66, 1202, 1321, 1481, 1484, 1498, 1508, 
1623, 1624;
* * * * *
    2. Part 10 is amended by revising the center heading preceding 
Sec. 10.151 to read as follows:

Importations Not Over $200 And Bona Fide Gifts

    3. Section 10.151 is revised to read as follows:


Sec. 10.151  Importations not over $200.

    Subject to the conditions in Sec. 10.153 of this part, the district 
director shall pass free of duty and tax any shipment of merchandise, 
as defined in Sec. 101.1(o) of this chapter, imported by one person on 
one day having a fair retail value, as evidenced by the bill of lading 
(or other document filed as the entry) or manifest listing each bill of 
lading, in the country of shipment 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 pertinent law or regulation. Merchandise subject to 
this exemption shall be entered under the informal entry procedures 
(see subpart C, part 143, and Secs. 128.24, 145.31, 148.12, and 148.62, 
of this chapter).

    4. Section 10.152 is revised to read as follows:


Sec. 10.152  Bona-fide gifts.

    Subject to the conditions in Sec. 10.153 of this part, the district 
director shall pass free of duty and tax any article sent as a bona-
fide gift from a person in a foreign country to a person in the United 
States, provided that the aggregate fair retail value in the country of 
shipment 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 entered under the informal entry procedures 
(see subpart C, part 143, and Secs. 145.32, 148.12, 148.51, and 148.64, 
of this chapter). An article is ``sent'' for purposes of this section 
if it is conveyed in any manner other than on the person or in the 
accompanied or unaccompanied baggage of the donor or donee.

    5. Section 10.153 is amended by removing the references to ``$50'' 
and ``$100'' wherever appearing in paragraphs (b), (d)(2), (d)(3) and 
(f), and by adding in place thereof, respectively, ``$100'' and 
``$200''.

PART 101--GENERAL PROVISIONS

    1. The authority for part 101 is revised to read as set forth 
below, and the authority citations following Secs. 101.1 and 101.4 are 
removed.

    Authority: 5 U.S.C. 301; 19 U.S.C. 2, 66, 1202 (General Note 17, 
Harmonized Tariff Schedule of the United States), 1623, 1624.

    2. Section 101.1 is amended by adding a new paragraph (o) to read 
as follows:


Sec. 101.1  Definitions.

* * * * *
    (o) Shipment. ``Shipment'' means the merchandise described on the 
bill of lading or other document used to file or support entry, or in 
the oral declaration when applicable.

PART 111--CUSTOMS BROKERS

    1. The general authority for part 111, and the specific section 
authority for Sec. 111.3, are revised to read as follows:

    Authority: 19 U.S.C. 66, 1202 (General Note 17, Harmonized 
Tariff Schedule of the United States (HTSUS)), 1624, 1641.

    Section 111.3 also issued under 19 U.S.C. 1484, 1498;
* * * * *
    2. Section 111.3 is amended by adding a new paragraph (e) to read 
as follows:


Sec. 111.3  Transactions for which license is not required.

* * * * *
    (e) Informal entries. A person entering merchandise qualifying for, 
and entered under, the informal entry procedures authorized by 19 
U.S.C. 1498 is not required to be licensed as a broker, unless required 
to be so licensed under Sec. 143.26 of this chapter, issued under the 
authority of 19 U.S.C. 1498.

PART 123--CUSTOMS RELATIONS WITH CANADA AND MEXICO

    1. The general authority for part 123, and the specific section 
authority for Secs. 123.12-123.18, are revised to read as follows:

    Authority: 19 U.S.C. 66, 1202 (General Note 17, Harmonized 
Tariff Schedule of the United States (HTSUS)), 1431, 1624;
* * * * *
    Sections 123.12 also issued under 19 U.S.C. 1202 (Chapter 86, 
Additional U.S. Note 1, HTSUS), 1322;
    Sections 123.13-123.18 also issued under 19 U.S.C. 1322;
* * * * *
    2. Section 123.12 is amended by revising the first sentence, 
respectively, of paragraphs (a)(1) and (a)(2), and by revising 
paragraph (b), to read as follows:


Sec. 123.12  Entry of foreign locomotives and equipment in 
international traffic.

    (a) * * *
    (1) On inward trip. Unless formally entered and cleared through 
Customs into the United States, or unless exempt from entry as provided 
in Sec. 141.4(b)(4) of this chapter, a foreign locomotive shall be used 
on the inward trip only in connection with taking the inbound train to 
the last place in a continuous haul, including the switching of cars 
which it has hauled into the United States. * * *
    (2) On outward trip. Unless formally entered and cleared through 
Customs into the United States, or unless exempt from entry as provided 
in Sec. 141.4(b)(4) of this chapter, foreign locomotives may be used on 
the outward trip only in connection with through trains crossing the 
boundary, including switching to make up such trains. * * *
    (b) Admission of empty equipment. Empty foreign railroad equipment 
shall be admitted to the United States without formal entry and payment 
of duty only if:
    (1) The passengers or goods to be loaded are to be transported 
directly to or through a foreign country; or
    (2) The equipment is exempt from entry as provided in 
Sec. 141.4(b)(4) of this chapter.
* * * * *

PART 128--EXPRESS CONSIGNMENTS

    1. The authority for part 128 is revised to read as follows:

    Authority: 19 U.S.C. 66, 1202 (General Note 17, Harmonized 
Tariff Schedule of the United States (HTSUS)), 1321, 1484, 1498, 
1551, 1555, 1556, 1565, 1624.

    2. Section 128.21 is amended by revising paragraph (a)(4) to read 
as follows:


Sec. 128.21  Manifest requirements.

    (a) Additional information. * * *
    (4) Specific description of the merchandise, and under the 
following conditions, the Harmonized Tariff Schedule of the United 
States (HTSUS) subheading number:
    (i) If the merchandise is required to be formally entered as 
provided in Sec. 128.25; or
    (ii) If the merchandise is eligible for, and is entered under, the 
informal entry procedures as provided in Sec. 128.24, but may not be 
passed free of duty and tax as consisting of a shipment of merchandise 
imported by one person on one day having a fair retail value in the 
country of shipment not exceeding $200, as provided in Sec. 128.24(e).
* * * * *
    3. Section 128.23 is revised to read as follows:


Sec. 128.23  Entry requirements.

    (a) General rule. Except as provided in paragraph (c) of this 
section, all articles carried by an express consignment entity shall be 
entered by a person with the right to file entry.
    (b) Procedures--(1) General. All express consignment entities 
utilizing the procedures in this part shall comply with the 
requirements of the Customs Automated Commercial System (ACS). These 
requirements include those under the Automated Manifest System (AMS), 
Cargo Selectivity, Statement Processing, the Automated Broker Interface 
System (ABI), and enhancements of ACS.
    (2) Entry number. All entry numbers must be furnished to Customs in 
a Customs approved bar coded readable format in order to assist in the 
processing of express consignment cargo under the Customs Automated 
Commercial System (ACS).
    (3) Paper entry document waiver. The district director is 
authorized, at the time of entry, to accept the appropriate electronic 
equivalent in lieu of entry documents for those entries designated as 
not requiring examination or review when the advance manifest 
requirements of Sec. 128.21(a) of this part have been met.
    (c) Exception. Articles specifically exempt from entry by 
Sec. 141.4(b) of this chapter need not satisfy the general rule as set 
forth in paragraph (a) of this section.

    4. Section 128.24 is amended by revising the last sentence of 
paragraph (b), and the first sentence of paragraph (c), and by revising 
paragraphs (d) and (e) to read as follows:


Sec. 128.24  Informal entry procedures.

* * * * *
    (b) Procedures. * * * The party who may make entry under 
Sec. 143.26 of this chapter may submit a copy of the invoice or the 
advance manifest as described in Sec. 128.21 in lieu of other control 
documents.
    (c) Alternative procedure. The party who may make entry under 
Sec. 143.26 of this chapter may be required to submit an individual 
Customs Form 3461 covering the eligible shipments on a daily basis or 
by flight basis. * * *
    (d) Entry summary. An entry summary (Customs Form 7501) must be 
presented in proper form, and estimated duties deposited within 10 days 
of the release of the merchandise under either the regular or 
alternative procedure described in this section. However, see paragraph 
(e) of this section if the shipment is valued at $200 or less.
    (e) Shipments valued at $200 or less. Shipments valued at $200 or 
less meeting the requirements of Sec. 10.151 of this chapter shall be 
passed free of duty and tax. Such shipments must be segregated from 
shipments valued at more than $200 if an advance manifest is used as 
the entry document, as provided for in Sec. 128.21. If such an advance 
manifest is used as the entry document, the following are not required 
to be provided for shipments qualifying under this paragraph:
    (1) The Harmonized Tariff Schedule of the United States (HTSUS) 
subheading number (see Sec. 128.21(a)(4)); and
    (2) An entry summary (see paragraph (d) of this section).

    5. Section 128.25 is revised to read as follows:


Sec. 128.25  Formal entry procedures.

    Formal entry, as provided for under 19 U.S.C. 1484 in parts 141, 
142, and 143 (except for subpart C), of this chapter, is required for 
all shipments exceeding the monetary limitation for informal entry (see 
Sec. 128.24) and any shipment for which the informal entry procedures 
may not be used (see Sec. 128.24).


Sec. 128.26  [Removed]

    6. Section 128.26 is removed.

PART 141--ENTRY OF MERCHANDISE

    1. The general authority for part 141 continues to read as follows, 
and the specific section authority for Sec. 141.4 is revised to read as 
follows:

    Authority: 19 U.S.C. 66, 1448, 1484, 1624.
* * * * *
    Section 141.4 also issued under 19 U.S.C. 1202 (General Note 13; 
Chapter 86, Additional U.S. Note 1; Chapter 89, Additional U.S. Note 
1; Chapter 98, Subchapter III, U.S. Note 4; Chapter 99, Subchapter 
V, U.S. Note 9, Harmonized Tariff Schedules of the United States 
(HTSUS)), 1498;
* * * * *
    2. Section 141.4 is revised to read as follows:


Sec. 141.4  Entry required.

    (a) General. All merchandise imported into the United States is 
required to be entered, unless specifically excepted.
    (b) Exceptions. The following are the exceptions to the general 
rule:
    (1) The exemptions listed in General Note 13 to the Harmonized 
Tariff Schedule of the United States (HTSUS).
    (2) Vessels (not including vessels classified in headings 8903 and 
8907 and subheadings 8905.90.10 and 8906.00.10 or in Chapter 98, HTSUS, 
such as under subheadings 9804.00.35 or 9813.00.35). See also Chapter 
89, Additional U.S. Note 1, HTSUS.
    (3) Instruments of international traffic described in Sec. 10.41a 
of this chapter, under the conditions provided for in that section. See 
also Chapter 98, Subchapter III, U.S. Note 4, HTSUS.
    (4) Railway locomotives classified in heading 8601 or 8602, HTSUS, 
and freight cars classified in heading 8606, HTSUS, on which no duty is 
owed (see paragraph (d) of this section). See Chapter 86, Additional 
U.S. Note 1, HTSUS; Chapter 99, Subchapter V, U.S. Note 9, HTSUS; see 
also 19 CFR part 123 for reporting requirements for railway equipment 
brought into the United States from Canada or Mexico.
    (c) Undeliverable articles. The exemption from entry for 
undeliverable articles under General Note 13(e), HTSUS, is subject to 
the following conditions:
    (1) The person claiming the exemption must submit a certification 
(documentary or electronic) that:
    (i) The merchandise was intended to be exported to a foreign 
country;
    (ii) The merchandise is being returned within 45 days of departure 
from the United States;
    (iii) The merchandise did not leave the custody of the carrier or 
foreign customs;
    (iv) The merchandise is being returned to the United States because 
it was undeliverable to the foreign consignee; and
    (v) The merchandise was not sent abroad to receive benefit from, or 
fulfill obligations to, the United States as a result of exportation.
    (2) Upon request by Customs, the person claiming the exemption 
shall provide evidence required to support the claim for exemption.
    (d) Railway locomotives and freight cars. To be excepted from 
entry, railway locomotives and freight cars described in Additional 
U.S. Note 1 of Chapter 86, HTSUS, and railway freight cars from Canada 
described in subheading 9905.86.05 or 9905.86.10, HTSUS, are subject to 
the following requirements, as applicable:
    (1) For a railway freight car described in subheading 9905.86.05, 
HTSUS, the importer shall certify, subject to Customs verification, 
that the freight car was produced before July 1, 1991, or if admitted 
after July 1, 1994, that the freight car was produced not less than 3 
years before the date of importation;
    (2) For a railway freight car described in subheading 9905.86.10, 
HTSUS, the importer shall certify, subject to Customs verification, 
that the freight car will be exported within 1 year from the date of 
importation. (Any railway freight car admitted into the United States 
under this provision which is not exported within the 1-year period 
becomes subject to entry and the payment of any applicable duties.);
    (3) For railway locomotives and freight cars described in 
Additional U.S. Note 1 of Chapter 86, HTSUS, and railway freight cars 
described in subheading 9905.86.05 or 9905.86.10, HTSUS, to be released 
in accordance with paragraph (b)(4) of this section, the importer shall 
first file a bond on Customs Form 301, containing the bond conditions 
set forth in either Sec. 113.62 or 113.64 of this chapter.
    (e) Informal entry. Merchandise qualifying for informal entry by 
regulation, pursuant to 19 U.S.C. 1498, is exempt from formal entry 
under 19 U.S.C. 1484 and this part, but must be entered as required 
under applicable regulations (see part 143, subpart C, and Secs. 10.151 
through 10.153, 128.24, 145.31, 145.32, 148.12, 148.13, 148.51, and 
148.62 of this chapter).

PART 143--SPECIAL ENTRY PROCEDURES

    1. The authority for part 143 continues to read as follows:

    Authority: 19 U.S.C. 66, 1481, 1484, 1498, 1624.

    2. Section 143.21 is amended by adding a paragraph (l) to read as 
follows:


Sec. 143.21  Merchandise eligible for informal entry.

* * * * *
    (l) Shipments of merchandise qualifying for the administrative 
exemptions under 19 U.S.C. 1321(a)(2) and provided for in--
    (1) Section 10.151 or 145.31 of this chapter (certain importations 
not exceeding $200 in value);
    (2) Section 10.152 or 145.32 of this chapter (certain bona-fide 
gifts not exceeding $100 in value ($200 in the case of articles sent 
from a person in the Virgin Islands, Guam, or American Samoa)); or
    (3) Section 148.51 or 148.64 of this chapter (certain personal or 
household articles not exceeding $200 in value).

    3. Section 143.23 is amended by adding two new paragraphs (i) and 
(j) to read as follows:


Sec. 143.23  Form of entry.

* * * * *
    (i) A shipment of merchandise not exceeding $1250 in value which is 
imported by an express consignment operator or carrier and which meets 
the requirements in Sec. 128.24 of this chapter may be entered as 
provided in that section.
    (j) Except for mail importations (see Secs. 145.31 and 145.32 of 
this chapter), or in the case of personal written or oral declarations 
(see Secs. 148.12, 148.13 and 148.62 of this chapter), a shipment of 
merchandise not exceeding $200 in value which qualifies for informal 
entry under 19 U.S.C. 1498 and meets the requirements in Sec. 10.151 or 
Sec. 10.152 of this chapter may be entered by presenting the bill of 
lading or a manifest listing each bill of lading (see Secs. 10.151, 
10.152 and 128.24(e) of this chapter). The following information is 
required to be filed as a part of such entry:
    (1) Country of origin of the merchandise;
    (2) Shipper name, address and country;
    (3) Ultimate consignee name and address;
    (4) Specific description of the merchandise;
    (5) Quantity; and
    (6) Value.

    4. Section 143.26 is added to read as follows:


Sec. 143.26  Party who may make informal entry of merchandise.

    (a) Shipments valued between $200 and $1250. A shipment of 
merchandise valued between $200 and $1250 which qualifies for informal 
entry under 19 U.S.C. 1498 may be entered by the owner or purchaser of 
the shipment or, when appropriately designated by the owner, purchaser, 
or consignee of the shipment, a Customs broker licensed under 19 U.S.C. 
1641.
    (b) Shipments valued at $200 or less. A shipment of merchandise 
valued at $200 or less which qualifies for informal entry under 19 
U.S.C. 1498 and meets the requirements in 19 U.S.C. 1321(a)(2) (see 
Secs. 10.151, 10.152, 10.153, 145.31, 145.32, 148.51, 148.64, of this 
chapter) may be entered by the owner, purchaser, or consignee of the 
shipment or, when appropriately designated by one of these persons, a 
Customs broker licensed under 19 U.S.C. 1641.

PART 145--MAIL IMPORTATIONS

    1. The general authority for part 145 is revised to read as 
follows:

    Authority: 19 U.S.C. 66, 1202 (General Note 17, Harmonized 
Tariff Schedule of the United States (HTSUS)), 1624.
* * * * *
    2. Section 145.31 is revised to read as follows:


Sec. 145.31  Importations not over $200 in value.

    The district director shall pass free of duty and tax, without 
preparing an entry as provided for in Sec. 145.12, packages containing 
merchandise having an aggregate fair retail value in the country of 
shipment of not over $200, subject to the requirements set forth in 
Secs. 10.151 and 10.153 of this chapter.

    3. Section 145.32 is revised to read as follows:


Sec. 145.32  Bona-fide gifts.

    The district director shall pass free of duty and tax, without 
preparing an entry as provided for in Sec. 145.12, articles sent as 
bona-fide gifts from persons in foreign countries to persons in the 
United States having an aggregate fair retail value in the country of 
shipment not exceeding $100 ($200, in the case of articles sent from 
persons in the Virgin Islands, Guam, and American Samoa), subject to 
the requirements set forth in Secs. 10.152 and 10.153 of this chapter.

PART 148--PERSONAL DECLARATIONS AND EXEMPTIONS

    1. The general authority for part 148 is revised, and the specific 
section authority for Secs. 148.43, 148.51, 148.63, 148.64 and 148.74 
continues, to read as follows:

    Authority: 19 U.S.C. 66, 1496, 1498, 1624. The provisions of 
this part, except for subpart C, are also issued under 19 U.S.C. 
1202 (General Note 17, Harmonized Tariff Schedule of the United 
States (HTSUS));
* * * * *
    Sections 148.43, 148.51, 148.63, 148.64 and 148.74 also issued 
under 19 U.S.C. 1321;
* * * * *


Secs. 148.12, 148.51, 148.64  [Amended]

    2. Sections 148.12(b)(2)(ii), 148.51(b)(1), and 148.64(b)(1) are 
amended by removing the reference to ``$25'' where appearing therein, 
and by adding in its place ``$200''.

PART 159--LIQUIDATION OF DUTIES

    1. The authority for part 159 continues to read as follows:

    Authority: 19 U.S.C. 66, 1500, 1624. Subpart C also issued under 
31 U.S.C. 5151. Additional authority and statutes interpreted or 
applied are cited in the text or following the sections affected.

    2. Section 159.6 is amended by removing the references to ``$10'' 
and ``duties'' wherever appearing in paragraphs (a), (b) and (c), and 
by adding in place thereof, respectively, ``$20'', and ``duties, fees, 
and taxes''; and by revising paragraph (d) to read as follows:


Sec. 159.6  Difference between liquidated duties and estimated duties.

* * * * *
    (d) Customs duties and fees and internal revenue taxes netted for 
$20 limit. The assessments of Customs duties and fees and internal 
revenue taxes shall be separately stated on the entry at the time of 
liquidation, but the amounts of any differences shall be netted when 
applying the $20 minimum for issuance of a bill or refund check.
George J. Weise,
Commissioner of Customs.

    Approved: May 26, 1994.
John P. Simpson,
Deputy Assistant Secretary of the Treasury.
[FR Doc. 94-14255 Filed 6-8-94; 4:40 pm]
BILLING CODE 4820-02-P