[Federal Register Volume 59, Number 157 (Tuesday, August 16, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-20028]


[[Page Unknown]]

[Federal Register: August 16, 1994]


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DEPARTMENT OF THE TREASURY
19 CFR Part 191

 

Eliminate Notice of Exportation, Customs Form 7511, as Proof of 
Exportation for Drawback; Withdrawal

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

ACTION: Proposed rule; withdrawal.

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SUMMARY: This document withdraws the proposed amendment to the Customs 
Regulations, which would have eliminated the requirement that the 
notice of exportation, Customs Form 7511, be submitted as proof of 
exportation for the purpose of obtaining drawback, and instead 
permitted the use of other documents generated internally in the course 
of trade to prove exportation. Customs has concluded that the retention 
of the notice of exportation is essential, especially in those 
circumstances where the drawback claimant is not the direct exporter, 
and the exporter refuses to provide its own documentary evidence to the 
claimant because of business confidentiality or the administrative cost 
of providing such supporting documents.

EFFECTIVE DATE: This withdrawal is effective on August 16, 1994.

FOR FURTHER INFORMATION CONTACT: Bruce Friedman, Office of Trade 
Operations, (202-927-0916).

SUPPLEMENTARY INFORMATION:

Background

    Drawback is a refund or remission, in whole or in part, of a 
Customs duty, internal revenue tax or fee. There are a number of 
different kinds of drawback authorized under law, including, for 
example, manufacturing drawback and unused merchandise drawback. In 
order to qualify for drawback, there must be an exportation or a 
destruction under Customs supervision. The statute providing for 
specific types of drawback is 19 U.S.C. 1313. Part 191, Customs 
Regulations (19 CFR part 191), contains the general regulations for 
drawback claims and specialized provisions for specific types of 
drawback claims.

    The requirements for establishing the exportation of merchandise as 
part of a drawback claim are set forth in subpart E of part 191. This 
subpart authorizes the use of several alternative procedures to 
establish exportation. Two such alternatives, contained in 
Secs. 191.51(a) and 191.52 (19 CFR 191.51(a), 191.52), require a 
claimant, in order to receive drawback, to file a notice of exportation 
on Customs Form (CF) 7511, either uncertified, or certified by a 
Customs officer at the time of exportation, for each shipment of 
merchandise exported. The information required on a CF 7511 consists of 
the name of the exporting vessel or carrier, the number and kinds of 
packages and their marks and numbers, a description of the merchandise, 
the name of the exporter, and the country of ultimate destination. This 
information, however, is also available from other paperwork, 
particularly documents usually generated by the exporter internally in 
the process of trade.
    Accordingly, Customs published a notice of proposed rulemaking in 
the Federal Register on October 7, 1992 (57 FR 46113), which would have 
eliminated the notice of exportation, CF 7511, and instead permitted 
the use of such other documents generated internally in the course of 
trade to prove exportation for purposes of obtaining drawback. It was 
believed that this would result in a saving of paperwork to the benefit 
of both Customs as well as the drawback claimant.

Discussion of Comments

    Thirty comments were received in response to the notice of proposed 
rulemaking. Of the thirty comments only four generally were in favor of 
eliminating or replacing the CF 7511. The remaining twenty-six comments 
strongly opposed the elimination of the CF 7511.
    Almost all of the commenters opposing the elimination of the CF 
7511 stated that they would be forced to relinquish their right to 
claim drawback whenever they were not the direct exporter. A separate 
exporter might not be willing to provide documentation that would 
reveal information such as the name and address of the foreign 
purchaser and prices charged by the exporter.
    Also, many of these commenters believed that the CF 7511 was 
necessary for shipments to Mexico and Canada, citing the unavailability 
of other documents as a continuing problem for drawback claimants.
    Another reason against the proposed change mentioned by several 
commenters was the fact that the reverse side of the CF 7511 is used 
for the endorsement of drawback rights from one party to another. This 
endorsement also satisfies the requirement of Sec. 191.73(a), which 
requires satisfactory evidence that the reservation was made with the 
knowledge and consent of the exporter. If this form were to be 
abolished, Customs would probably have to develop another form to take 
its place.
    It was further asserted that the CF 7511 in fact also provided 
information that might not be readily available on other documents, 
such as the name of the carrier, the date of exportation, the 
destination, and the shipper.

Conclusion

    Though the concerns about proof of exportation to Mexico and Canada 
have been resolved by Sec. 181.47(c), Customs Regulations (19 CFR 
181.47(c)), which also allows a copy of the Canadian or Mexican customs 
entry to be used as proof of exportation, Customs is, nevertheless, 
constrained to conclude that the comments submitted point out 
persuasive, and controlling, reasons militating against adoption of the 
proposal, and that, on balance, the retention of the notice of 
exportation satisfies the concerns of the trade, while occasioning 
relatively minimum and reasonably justified time and effort in its 
preparation and/or certification. In particular, the retention of the 
notice is essential, especially in those circumstances where the 
drawback claimant is not the direct exporter, and the exporter refuses 
to provide its own documentary evidence to the claimant because of 
business confidentiality or the administrative cost of providing such 
supporting documents.

Withdrawal of Proposal

    In view of the foregoing, and after consideration of the comments 
received and further review of the matter, Customs has determined to 
withdraw the notice of proposed rulemaking published in the Federal 
Register on October 7, 1992 (57 FR 46113).

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.
Michael H. Lane,
Acting Commissioner of Customs.
    Approved: July 22, 1994.
John P. Simpson,
Deputy Assistant Secretary of the Treasury.
[FR Doc. 94-20028 Filed 8-15-94; 8:45 am]
BILLING CODE 4820-02-P