[Federal Register Volume 60, Number 96 (Thursday, May 18, 1995)]
[Notices]
[Pages 26745-26746]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-12344]



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OFFICE OF THE UNITED STATES TRADE REPRESENTATIVE

[Docket No. 301-93]


Notice of Determination and Request for Public Comment Concerning 
Proposed Determination of Action Pursuant to Section 301: Barriers to 
Access to the Auto Parts Replacement Market in Japan

AGENCY: Office of the United States Trade Representative.

ACTION: Notice of determination under section 304(a)(1)(A) of the Trade 
Act of 1974, as amended (Trade Act) (19 U.S.C. 2414(a)(1)(A)); notice 
of proposed determination of action to be taken under section 
304(a)(1)(B) of the Trade Act and notice of public hearing and request 
for public comment pursuant to section 304(b) of the Trade Act.

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SUMMARY: The United States Trade Representative (USTR) has determined 
pursuant to section 304(a)(1)(A)(ii) of the Trade Act that certain 
Acts, policies and practices of Japan that restrict or deny suppliers 
of U.S. auto parts access to the auto parts replacement and accessories 
market (``after-market'') in Japan are unreasonable and discriminatory 
and burden or restrict U.S. commerce. The USTR is seeking public 
comment and will hold a public hearing on June 8 and 9, 1995, regarding 
the proposed determination pursuant to section 304(a)(1)(B) on the 
appropriate action under section 301 being considered in response to 
these acts, policies and practices.

DATES: Written comments on the determination are due by noon, Monday, 
June 19, 1995. Requests to testify at the hearing must be submitted by 
noon, Thursday, May 25, 1995. Written testimony is due by noon, Friday, 
June 2, 1995, and written rebuttals are due by noon, Wednesday, June 
21, 1995.

ADDRESSES: Office of the United States Trade Representative, 600 17th 
Street NW., Washington, DC 20506.

FOR FURTHER INFORMATION CONTACT:
David Burns, Senior Advisor for Japan, (202) 395-5050, or James 
Southwick, Assistant General Counsel, (202) 395-7203. Questions about 
the public hearing, written testimony and written comments should be 
directed to Sybia Harrison, Staff Assistant to Section 301 Committee, 
(202) 395-3432.

SUPPLEMENTARY INFORMATION: On October 1, 1994, the USTR initiated an 
investigation pursuant to section 302(b) of the Trade Act to determine 
whether specific barriers to access to the after-market for auto parts 
in Japan are unreasonable or discriminatory and burden or restrict U.S. 
commerce. By Federal Register notice dated October 13, 1994 (59 FR 
52034), the USTR requested public comment on the issues raised in the 
investigation. The comment period was subsequently extended by a 
Federal Register notice dated November 10, 1994 (59 FR 56099).
    Officials of the Office of the USTR and other United States 
agencies have conducted extensive consultations with Japanese 
government officials concerning these market access barriers, but 
negotiations have failed to resolve the issues under investigation. 
Consequently, on May 10, 1995, the USTR pursuant to section 
304(a)(1)(A)(ii) of the Trade Act determined that certain acts, 
policies and practices of Japan that restrict or deny suppliers of U.S. 
auto parts access to the auto parts replacement and accessories market 
(``after-market'') in Japan are unreasonable and discriminatory and 
burden or restrict U.S. commerce.

Reasons for Determination

    The Japanese market for replacement auto parts is restricted by a 
complex system that is not reasonable or justifiable. This system 
channels most repair work to government-certified garages that use very 
few foreign parts, and the system restricts the development of other 
garages more likely to carry and use foreign parts. In addition, even 
minor additions of accessories to motor vehicles require a full vehicle 
inspection and tax payment, which severely limits opportunities for 
U.S. automotive accessories suppliers.
    The United States pressed Japan for broad reform in the 
aftermarket. The U.S. proposals did not ask for reduction of safety or 
environmental standards, but for measures that would allow for 
substantially more repair work to be performed outside the certified 
garages, and therefore would open up opportunities for foreign 
suppliers. The Government of Japan was unwilling to make changes to key 
elements of the system which restricts opportunities for U.S. and other 
foreign parts suppliers.

Proposed Determination on Appropriate Action

    If the USTR makes an affirmative determination pursuant to section 
304(a)(1)(A)(ii) of the Trade Act, pursuant to section 304(a)(1)(B) the 
USTR also must determine what action, if any, by the United States is 
appropriate. If the USTR determines that action is appropriate, section 
301(b) of the Trade Act directs the USTR to take all appropriate and 
feasible action to obtain the elimination of the unreasonable or 
discriminatory act, policy or practice.
    Therefore, the USTR proposes to take the following action, pursuant 
to the authority provided by section 301(c)(1)(B) of the Trade Act:
    To impose prohibitive (100 percent ad valorem) duties upon luxury-
type motor vehicles from Japan. The increased tariffs will apply to the 
following motor cars and other motor vehicles principally designed for 
the transport of persons provided for in heading 8703 of the Harmonized 
Tariff Schedule of the United States (HTS):
    (1) Motor vehicles having 4 doors, a wheelbase more than 260 cm 
(102.4 inches) but not more than 263 cm (103.6 inches), a curb weight 
more than 1,495 kg (3,295.9 pounds), a height not more than 138 cm 
(54.3 inches), and a spark-ignition internal combustion reciprocating 
piston engine with 6 or more cylinders, having a total cylinder 
capacity exceeding 2,900 cc or a rotary piston engine (provided for in 
HTS subheadings 8703.23, 8703.24 or 8703.90); and
    (2) Motor vehicles having a wheelbase exceeding 266 cm (104.7 
inches), a curb weight more than 1,365 kg (3009.3 pounds), a height not 
more than 145 cm (57 inches), and either a spark-ignition 
[[Page 26746]] internal combustion reciprocating piston engine having a 
total cylinder capacity exceeding 2,900 cc or a rotary piston engine 
(provided for in HTS subheadings 8703.23, 8703.24 or 8703.90).
    The USTR has asked the Customs Service to withhold liquidation of 
the entries of the goods identified above which are entered, or 
withdrawn from warehouse for consumption, on or after May 20, 1995. If 
the proposed duty increases enter into effect, the USTR intends to make 
these increases effective as of May 20, 1995.
    In making this determination, the USTR will consider public 
comments submitted in accordance with the requirements set forth below.

Public Comment on Proposed Determination; Hearing Participation

    In accordance with section 304(b) of the Trade Act, the USTR 
invites all interested persons to provide written comments on the 
proposed determination. Comments may address: (1) The appropriateness 
of subjecting the motor vehicles described above to an increase in 
duties; (2) the levels at which duties should be set; and (3) the 
degree to which an increase in duties might have an adverse effect on 
U.S. consumers. Written comments are due by noon, Monday, June 19, 
1995.
    The USTR also will consider the written, oral, and rebuttal 
comments submitted in the context of public hearings held pursuant to 
section 304(b) of the Trade Act and in accordance with 15 CFR 2006.7 
through 2006.9. The hearings will commence at 10 a.m. on Thursday, June 
8, 1995, and continue on Friday, June 9, 1995, if necessary. The 
hearings will be held in Room 100 at the U.S. International Trade 
Commission, 500 E Street, SW., Washington, DC 20436.
    Request to Testify: Interested persons wishing to testify orally at 
the hearings must provide a written request to do so by noon, Thursday, 
May 25, 1995, to Sybia Harrison, Staff Assistant to the Section 301 
Committee, Office of the U.S. Trade Representative, 600 17th Street 
NW., Washington, DC 20506. Requests to testify must include the 
following information: (1) Name, address, telephone number, and firm or 
affiliation of the person wishing to testify; and (2) a brief summary 
of the comments to be presented. Requests to testify must conform to 
the requirements of 15 CFR 2006.8(a). After the Chairman of the Section 
301 Committee considers the request to present oral testimony, Ms. 
Harrison will notify the applicant of the time of his or her testimony. 
Remarks at the hearing will be limited to 5 minutes.
    Written Testimony and Rebuttal Briefs: In addition, persons 
presenting oral testimony must submit their complete written testimony 
by noon, Friday, June 2, 1995. In order to assure each party an 
opportunity to contest the information provided by other parties, USTR 
will entertain rebuttal briefs filed by any party by noon, Wednesday 
June 21, 1995. In accordance with 15 CFR 2006.8(c), rebuttal briefs 
should be strictly limited to demonstrating errors of fact or analysis 
not pointed out in the briefs or hearing and should be as concise as 
possible.
    Requirements for Submissions: Written comments on the proposed 
determination, written testimony, and rebuttal briefs must be filed in 
accordance with thr requirements set forth in 15 CFR 2006.8(b). 
Comments must state clearly the position taken and describe with 
particularity the supporting rationale, be in English, and be provided 
in twenty copies to: Chairman, Section 301 Committee, Attn: Auto Parts 
Investigation, Room 223, USTR, 600 17th St NW., Washington, DC 20506.
    Written comments, testimony, and briefs will be placed in a file 
(Docket 301-93) open to public inspection pursuant to 15 CFR 2006.13, 
except confidential business information exempt from public inspection 
in accordance with 15 CFR 2006.15. Persons wishing to submit 
confidential business information must certify in writing that such 
information is confidential in accordance with 15 CFR 2006.15(b), and 
such information must be clearly marked ``Business Confidential'' in a 
contrasting color ink at the top of each page on each of the twenty 
copies and must be accompanied by a nonconfidential summary of the 
confidential information. The nonconfidential summary will be placed in 
the Docket open to public inspection. An appointment to review the 
docket may be made by calling Brenda Webb (202) 395-6186. The USTR 
Reading room is open to the public from 10 a.m. to 12 noon and 1 p.m. 
to 4 p.m., Monday through Friday, and is located in: Room 101, Office 
of the United States Trade Representative, 600 17th Street NW., 
Washington, DC 20506.
Irving A. Williamson,
Chairman, Section 301 Committee.
[FR Doc. 95-12344 Filed 5-16-95; 8:45 am]
BILLING CODE 3190-01-M