[Federal Register Volume 61, Number 59 (Tuesday, March 26, 1996)]
[Notices]
[Pages 13214-13215]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-7213]



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INTERNATIONAL TRADE COMMISSION
[Investigation No. 332-360]


International Harmonization of Customs Rules of Origin

AGENCY: United States International Trade Commission.

ACTION: Request for public comment on draft proposals for chapters 71-
81.

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EFFECTIVE DATE: March 18, 1996.

FOR FURTHER INFORMATION CONTACT: Eugene A. Rosengarden, Director, 
Office of Tariff Affairs and Trade Agreements (O/TA&TA) (202-205-2595), 
or Lawrence A. DiRicco (202-205-2606).
    Parties having an interest in particular products or HTS chapters 
and desiring to be included on a mailing list to receive available 
documents pertaining thereto should advise Diane Whitfield by phone 
(202-205-2610) or by mail at the Commission, 500 E St SW., Room 404, 
Washington, DC 20436. Hearing impaired persons are advised that 
information on this matter can be obtained by contacting the 
Commission's TDD terminal on 202-205-1810. The media should contact 
Margaret O'Laughlin, Director, Office of Public Affairs (202-205-1819).

BACKGROUND: Following receipt of a letter from the United States Trade 
Representative (USTR) on January 25, 1995, the Commission instituted 
Investigation No. 332-360, International Harmonization of Customs Rules 
of Origin, under section 332(g) of the Tariff Act of 1930 (60 FR 19605, 
April 19, 1995).
    The investigation is intended to provide the basis for Commission 
participation in work pertaining to the Uruguay Round Agreement on 
Rules of Origin (ARO), under the General Agreement on Tariffs and Trade 
(GATT) 1994 and adopted along with the Agreement Establishing the World 
Trade Organization (WTO).
    The ARO is designed to harmonize and clarify nonpreferential rules 
of origin for goods in trade on the basis of the substantial 
transformation test; achieve discipline in the rules' administration; 
and provide a framework for notification, review, consultation, and 
dispute settlement. These harmonized rules are intended to make 
country-of-origin determinations impartial, predictable, transparent, 
consistent, and neutral, and to avoid restrictive or distortive effects 
on international trade. The ARO provides that technical work to those 
ends will be undertaken by the Customs Cooperation Council (CCC) (now 
informally known as the World Customs Organization or WCO), which must 
report on specified matters relating to such rules for further action 
by parties to the ARO. Eventually, the WTO Ministerial Conference is to 
``establish the results of the harmonization work program in an annex 
as an integral part'' of the ARO.
    In order to carry out the work, the ARO calls for the establishment 
of a Committee on Rules of Origin of the WTO and a Technical Committee 
on Rules of Origin (TCRO) of the CCC. These Committees bear the primary 
responsibility for developing rules that achieve the objectives of the 
ARO.
    A major component of the work program is the harmonization of 
origin rules for the purpose of providing more certainty in the conduct 
of world trade. To this end, the agreement contemplates a 3-year CCC 
program, to be initiated as soon as possible after the entry into force 
of the Agreement Establishing the WTO. Under the ARO, the TCRO is to 
undertake (1) to develop harmonized definitions of goods considered 
wholly obtained in one country, and of minimal processes or operations 
deemed not to confer origin, (2) to consider the use of change in 
Harmonized System classification as a means of reflecting substantial 
transformation, and (3) for those products or sectors where a change of 
tariff classification does not allow for the reflection of substantial 
transformation, to develop

[[Page 13215]]
supplementary or exclusive origin criteria based on value, 
manufacturing or processing operations or on other standards.
    To assist in the Commission's participation in work under the 
Agreement on Rules of Origin (ARO), the Commission is making available 
for public comment draft proposed rules for goods of:

Chapter 71--Natural or Cultured Pearls, Precious or Semi-precious 
Stones, Precious Metals, Metals Clad with Precious Metal and Articles 
Thereof; Imitation Jewelry; Coin
Chapter 72--Iron and Steel
Chapter 73--Articles of Iron or Steel
Chapter 74--Copper and Articles Thereof
Chapter 75--Nickel and Articles Thereof
Chapter 76--Aluminum and Articles Thereof
Chapter 78--Lead and Articles Thereof
Chapter 79--Zinc and Articles Thereof
Chapter 80--Tin and Articles Thereof
Chapter 81--Other Base Metals; Cermets; Articles Thereof

of the Harmonized System that are not considered to be wholly made in a 
single country. The rules rely largely on the change of heading as a 
basis for ascribing origin.
    Copies of the proposed revised rules will be available from the 
Office of the Secretary at the Commission, from the Commission's 
Internet web server (http://www.usitc.gov), or by submitting a request 
on the Office of Tariff Affairs and Trade Agreements voice messaging 
system, 202-205-2592 or by FAX at 202-205-2616.
    These proposals, which have been reviewed by interested government 
agencies, are intended to serve as the basis for the U.S. proposal to 
the Technical Committee on Rules of Origin (TCRO) of the Customs 
Cooperation Council (CCC) (now known as the World Customs Organization 
or WCO). The proposals do not necessarily reflect or restate existing 
Customs treatment with respect to country of origin applications for 
all current non-preferential purposes. Based upon a decision of the 
Trade Policy Staff Committee, the proposals are intended for future 
harmonization for the nonpreferential purposes indicated in the ARO for 
application on a global basis. They seek to take into account not only 
U.S. Customs current positions on substantial transformation but 
additionally seek to consider the views of the business community and 
practices of our major trading partners as well. As such they represent 
an attempt at reaching a basis for agreement among the contracting 
parties. The proposals may undergo change as proposals from other 
government administrations and the private sector are received and 
considered. Under the circumstances, the proposals should not be cited 
as authority for the application of current domestic law.
    If eventually adopted by the TCRO for submission to the Committee 
on Rules of Origin of the World Trade Organization, these proposals 
would comprise an important element of the ARO work program to develop 
harmonized, non-preferential country of origin rules, as discussed in 
the Commission's earlier notice. Thus, in view of the importance of 
these rules, the Commission seeks to ascertain the views of interested 
parties concerning the extent to which the proposed rules reflect the 
standard of substantial transformation provided in the Agreement. In 
addition, comments are also invited on the format of the proposed rules 
and whether it is preferable to another presentation, such as the 
format for the presentation of the NAFTA origin or marking rules.
    Forthcoming Commission notices will advise the public on the 
progress of the TCRO's work and will contain any harmonized definitions 
or rules that have been provisionally or finally adopted.

WRITTEN SUBMISSIONS: Interested persons are invited to submit written 
statements (original and 14 copies) concerning this phase of the 
Commission's investigation. Written statements should be submitted to 
the Office of the Secretary, and follow-up statements are permitted; 
but all statements must be received at the Commission by the close of 
business on May 3, 1996, in order to be considered. Information 
supplied to the Customs Service in statements filed pursuant to notices 
of that agency has been given to us and need not be separately provided 
to the Commission. Again, the Commission notes that it is particularly 
interested in receiving input from the private sector on the effects of 
the various proposed rules and definitions on U.S. exports. Commercial 
or financial information which a submitter desires the Commission to 
treat as confidential must be submitted on separate sheets of paper, 
each marked ``Confidential Business Information'' at the top. All 
submissions requesting confidential treatment must conform with the 
requirements of section 201.6 of the Commission's Rules of Practice and 
Procedure (19 CFR 201.6). All written submissions, except for 
confidential business information, will be available for inspection by 
interested persons. All submissions should be addressed to the Office 
of the Secretary, United States International Trade Commission, 500 E 
Street SW., Washington, DC 20436.

    Issued: March 18, 1996.

    By order of the Commission.
Donna Koehnke,
Secretary.
[FR Doc. 96-7213 Filed 3-25-96; 8:45 am]
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