[Federal Register Volume 61, Number 250 (Friday, December 27, 1996)]
[Notices]
[Pages 68295-68296]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-33012]


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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 50-
63 (Textiles).

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EFFECTIVE DATE: December 20, 1996.

FOR FURTHER INFORMATION CONTACT: Eugene A. Rosengarden, Director, 
Office of Tariff Affairs and Trade Agreements (O/TA&TA) (202-205-2595), 
or Jan Summers (202-205-2605).
    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, D.C. 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 WCO. 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 WCO 
program, which was formally initiated in July, 1995. 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 supplementary or exclusive 
origin criteria based on value, manufacturing or processing operations 
or on other standards.
    The draft rules for chapters 50-63 of the Harmonized System that 
are being made available for public comment cover goods 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. Due to their length, the rules will not be available by FAX. 
These proposals are intended to serve as the basis for the U.S. 
proposal to the Technical Committee on Rules of Origin of the WCO. The 
proposals are based on the principles of application enacted by 
Congress in Section 334 of the Uruguay Round Agreements Act (19 U.S.C. 
3592) with respect to country of origin determinations for textile 
goods but may not necessarily reflect or restate existing Customs 
treatment in all cases for all current nonpreferential 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. 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.
    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 concerning this phase of the Commission's investigation. 
Written statements should be submitted as quickly as possible, and 
follow-up statements are permitted; but all statements must be received 
at the Commission by the close of business on February 7, 1997 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

[[Page 68296]]

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: December 23, 1996.

    By order of the Commission.
Donna R. Koehnke,
Secretary.
[FR Doc. 96-33012 Filed 12-26-96; 8:45 am]
BILLING CODE 7020-02-P