[Federal Register Volume 61, Number 109 (Wednesday, June 5, 1996)]
[Proposed Rules]
[Pages 28522-28524]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-14124]
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DEPARTMENT OF THE TREASURY
Customs Service
19 CFR Part 151
RIN 1515-AB75
Detention of Merchandise
AGENCY: Customs Service, Department of the Treasury.
ACTION: Proposed rule.
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SUMMARY: This document proposes amendments to the Customs Regulations
to provide for procedures regarding the detention of merchandise that
is undergoing extended Customs examination. It is intended that the
[[Page 28523]]
Customs Regulations regarding this subject accurately reflect recent
amendments to the underlying statutory authority, enacted as part of
the Customs modernization portion of the North American Free Trade
Agreement Implementation Act.
DATES: Comments must be received on or before August 5, 1996.
ADDRESSES: Written comments (preferably in triplicate) may be addressed
to the Regulations Branch, Office of Regulations and Rulings, U.S.
Customs Service, 1301 Constitution Avenue, NW., Washington, DC 20229.
Comments submitted may be inspected at the Regulations Branch, Office
of Regulations and Rulings, Franklin Court, 1099 14th Street, Suite
4000, Washington, DC.
FOR FURTHER INFORMATION CONTACT: Jeremy Baskin, Penalties Branch, 202-
482-6950.
SUPPLEMENTARY INFORMATION:
Background
On December 8, 1993, amendments to certain Customs and navigation
laws became effective as the result of the enactment of the North
American Free Trade Agreement (NAFTA) Implementation Act, Public Law
103-182, Title VI of which is the Customs modernization portion
thereof, popularly known as the Customs Modernization Act (Mod Act).
Section 613 of the Mod Act amended the provisions of section 499 of the
Tariff Act of 1930, as amended (19 U.S.C. 1499), to provide for the
detention of merchandise in any case where Customs is unable, upon
initial examination, to make a determination as to whether that
imported merchandise complies with requirements of the laws of the
United States. Much of the new legislation brought the law into
conformity with existing Customs practice with regard to the
examination and detention of merchandise.
Prior to this amendment, Customs, while having extensive
examination authority, had no specific statutory or regulatory
procedures for detaining merchandise whose admissibility had not yet
been determined. The Mod Act codified Customs current detention
practices. Importers are provided an accelerated method to receive
administrative or judicial review of any decision to exclude.
Customs has five days after merchandise is presented for
examination to determine whether such merchandise should be detained or
can be released. Through this document Customs is proposing that
merchandise shall be considered to be presented for Customs examination
when it is in a condition to be viewed and examined by a Customs
officer. Mere presentation to the examining officer of a cargo van,
container or instrument of international traffic in which the
merchandise to be examined is contained will not be considered to be
presentation of the merchandise for Customs examination for purposes of
starting the five-day period in which the decision to detain or release
must be made. Further, consistent with the provisions of Sec. 151.7 of
the Customs Regulations (19 CFR 151.7), relating to the examination of
merchandise at a place other than the public stores, the importer shall
bear any expense involved in preparing the merchandise for Customs
examination.
Customs is required to issue a written notice of detention to the
importer or other party having an interest in the subject merchandise.
The notice shall advise the importer or other interested party of the
initiation of the detention, the specific reason for same, the
anticipated length of the detention, the nature of the tests or
inquiries to be conducted and the nature of any information which, if
supplied to Customs, may accelerate the disposition of the detention.
The importer or other interested party shall be afforded the
opportunity to remedy the cause for detention and bring the detained
merchandise into compliance within 30 days after issuance of the
notice. After 30 days or such longer period as authorized by law, if
Customs has not made a final determination to release or seize, the
goods are deemed to be excluded. Under Customs proposal, the 30-day
limitation may be extended when the importer or interested party
requests in writing an extension of the detention period, in order to
comply with Customs requirements. In the absence of a written request
for an extension, the importer or interested party may file a protest
as to the exclusion. If, within 30 days after filing of the protest,
Customs fails to act, the importer or interested party may seek
judicial review in the Court of International Trade. The detention/
exclusion period will generally not extend beyond 60 days (unless a
longer period is authorized by law) without the importer or interested
party being afforded judicial review. At any time during the detention
period, the merchandise may be seized and forfeited, if the facts so
warrant. The proposed regulations also permit Customs to allow
exportation of the goods in lieu of seizure with all costs of
exportation being borne by the importer.
The law compels Customs to make timely decisions, provide timely
notices, disclose available testing results and descriptions of
procedures and methodologies that are not proprietary to Customs or the
holder of any copyright or patent, and process any exclusion protests
within a prescribed statutory time period. If a notice to exclude is
not issued within such time period, the burden of proof is on Customs
to show, by a preponderance of the evidence, good cause as to why an
admissibility decision had not been made prior to the time the importer
commenced suit. If Customs makes the decision to exclude, an importer
wishing to challenge the decision shall bear the burden of proof. These
procedures are applicable to those cases where Customs has the
responsibility and authority to determine the admissibility of the
merchandise. They do not apply to those situations where the decision
of admissibility lies with another Federal agency.
This document proposes to amend the regulations to accurately
reflect the statutory changes promulgated by the Mod Act.
Comments
Before adopting the proposed amendments, consideration will be
given to any written comments (preferably in triplicate) that are
timely submitted to Customs. Comments submitted will be available for
public inspection in accordance with the Freedom of Information Act (5
U.S.C. 552), Sec. 1.4, Treasury Regulations (31 CFR 1.4) and
Sec. 103.11(b), Customs Regulations (19 CFR 103.11(b)), on regular
business days between the hours of 9 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
For the reasons given in the preamble to this document, pursuant to
the provisions of the Regulatory Flexibility Act (5 U.S.C. 601 et
seq.), it is certified that the proposed amendments would not have a
significant economic impact on a substantial number of small entities.
Thus, they are not subject to the requirements of 5 U.S.C. 603 or 604.
Nor would the proposed rule result in a ``significant regulatory
action'' under E.O. 12866.
Paperwork Reduction Act
The collection of information contained in this notice of proposed
rulemaking has been submitted to the Office of Management and Budget
for review in accordance with the Paperwork Reduction Act of 1995 (44
U.S.C. 3507).
[[Page 28524]]
An agency may not conduct or sponsor, and a person is not required
to respond to a collection of information unless the collection of
information displays a valid control number.
The collection of information in this document is in Sec. 151.16
(d) and (f). This information is necessary and will be used to
determine the admissibility of imported merchandise and to otherwise
comply with the requirements of the Mod Act and protect the revenue.
The likely respondents and/or recordkeepers are business or other for-
profit institutions.
Estimated annual reporting and/or recordkeeping burden: 500 hours.
Estimated average annual burden per respondent/recordkeeper: 2
hours.
Estimated number of respondents and/or recordkeepers: 250.
Estimated annual frequency of responses: 1.
Comments on the collection of information should be sent to the
Office of Management and Budget, Attention: Desk Officer of the
Department of the Treasury, Office of Information and Regulatory
Affairs, Washington, DC 20503. A copy should also be sent to the
Regulations Branch, Office of Regulations and Rulings, U.S. Customs
Service, 1301 Constitution Avenue, NW., Washington, DC 20229. Comments
should be submitted within the time frame that comments are due
regarding the substance of the proposal.
Comments are invited on: (a) Whether the collection of information
is necessary for the proper performance of the functions of the agency,
including whether the information shall have practical utility; (b) the
accuracy of the agency's estimate of the burden of the collection of
the information; (c) ways to enhance the quality, utility, and clarity
of the information to be collected; and (d) ways to minimize the burden
of the collection of information on respondents, including through the
use of automated collection techniques or other forms of information
technology.
List of Subjects in 19 CFR Part 151
Examination, Sampling and testing of merchandise.
Proposed Amendments to the Regulations
It is proposed to amend part 151, Customs Regulations (19 CFR part
151), as set forth below:
PART 151--EXAMINATION, SAMPLING AND TESTING OF MERCHANDISE
1. The general authority citation for part 151, and the specific
authority for subpart A, would continue to read as follows:
Authority: 19 U.S.C. 66, 1202 (General Notes 20 and 21,
Harmonized Tariff Schedule of the United States), 1624. Subpart A
also issued under 19 U.S.C. 1499. * * *
2. It is proposed to amend part 151 by adding a new Sec. 151.16 to
read as follows:
Sec. 151.16 Detention of merchandise.
(a) Other agencies not affected. The provisions of this section are
not applicable to detentions effected by Customs on behalf of other
agencies of the U.S. Government.
(b) Decision to detain or release. Within the 5-day period
(excluding weekends and holidays) following the date on which
merchandise is presented for Customs examination, Customs shall decide
whether to release or detain the merchandise. Merchandise which is not
released within such 5-day period shall be considered to be detained
merchandise. For purposes of this section, merchandise shall be
considered to be presented for Customs examination when it is in a
condition to be viewed and examined by a Customs officer. Mere
presentation to the examining officer of a cargo van, container or
instrument of international traffic in which the merchandise to be
examined is contained will not be considered to be presentation of
merchandise for Customs examination for purposes of this section. All
costs relating to the preparation of merchandise for examination shall
be borne by the importer.
(c) Notice of detention. If a decision to detain merchandise is
made, Customs shall issue a notice to the importer or other party
having an interest in such merchandise no later than 5 days (excluding
weekends and holidays) after such decision. The notice shall be
prepared by the Customs officer detaining the merchandise and shall
advise the importer or other interested party of the:
(1) Initiation of the detention;
(2) Specific reason for the detention;
(3) Anticipated length of the detention;
(4) Nature of the tests or inquiries to be conducted; and
(5) Nature of any information which, if supplied to the Customs,
may accelerate the disposition of the detention.
(d) Providing testing results. Upon written request by the importer
or other party having an interest in the detained merchandise, Customs
shall provide copies of the results of any testing conducted on the
merchandise together with a description of the testing procedures and
methodologies used (unless such procedures or methodologies are
proprietary to the holder of a copyright or patent or were developed by
Customs for enforcement 9 purposes). The results and test description
shall be in sufficient detail to permit the duplication and analysis of
the testing and the results.
(e) Seizure and forfeiture; denial of entry or exportation. If
otherwise provided by law, detained merchandise may be seized and
forfeited. In lieu of seizure and forfeiture, Customs may deny entry
and, where not otherwise prohibited by law, permit the merchandise to
be exported with all expenses of exportation being borne by the
importer.
(f) Final decisions; extension of time. A final decision with
respect to detained merchandise will be made within 30 days from the
date the shipment was detained. The 30-day limitation may be extended
when the importer or interested party requests in writing an extension
of the detention period, in order to comply with Customs requirements.
(g) Effect of failure to make a determination. The failure by
Customs to make a final determination with respect to the admissibility
of detained merchandise within 30 days after the merchandise has been
presented for Customs examination, or such longer period if
specifically authorized by law, or such extension of time as allowed by
paragraph (f) of this section, shall be treated as a decision by
Customs to exclude the merchandise for purposes of Sec. 514(a)(4) of
the Tariff Act of 1930, as amended (19 U.S.C. 1514(a)(4)). Such
decision may be the subject of a protest.
(h) Effect of failure to decide protest. If a protest which is
filed as a result of exclusion of detained merchandise is not allowed
or is denied in whole or in part before the 30th day after the day on
which the protest was filed, it shall be treated as having been denied
on such 30th day.
(i) Burden of proof and decisions of the court. Once an action
respecting a detention is commenced, unless Customs establishes by a
preponderance of the evidence that an admissibility decision has not
been reached for good cause, the court shall grant the appropriate
relief which may include, but is not limited to, an order to cancel the
detention and release the merchandise.
George J. Weise,
Commissioner of Customs.
Approved: April 18, 1996.
John P. Simpson,
Deputy Assistant Secretary of the Treasury.
[FR Doc. 96-14124 Filed 6-4-96; 8:45 am]
BILLING CODE 4820-02-P