[Federal Register Volume 62, Number 127 (Wednesday, July 2, 1997)]
[Notices]
[Pages 35834-35835]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-17368]


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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 comments on draft proposals for chapters 85 
and 90.

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EFFECTIVE DATE: June 26, 1997.

FOR FURTHER INFORMATION CONTACT: Eugene A. Rosengarden, Director, 
Office of Tariff Affairs and Trade Agreements (O/TA&TA) (202-205-2595), 
or Craig Houser, Nomenclature Analyst (202-205-2597).
    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 telephone 
(202-205-2610) or by mail at the Commission, 500 E Street 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 in the Office of External Relations (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), which has 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 this work, the ARO called 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 other standards.
    The draft U.S. proposed rules for the goods of:

Chapter 85--Electrical machinery and equipment and parts thereof; sound 
recorders and reproducers, television image and sound recorders and 
reproducers, and parts and accessories of such articles
Chapter 90--Optical, photographic, cinematographic, measuring, 
checking, precision, medical or surgical instruments and apparatus; 
parts and accessories thereof

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 home page (http://www.usitc.gov), or by 
submitting a request on the Office of Tariff Affairs and Trade 
Agreements voice messaging system (202-205-2592).
    These proposals are intended to serve as the basis for the U.S. 
proposal to the

[[Page 35835]]

TCRO of WCO. 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, the proposed draft rules released at this time do not 
contain any special provisions concerning the origin of goods 
classified either as unfinished articles or parts of articles and which 
undergo significant processing or assembly operations sufficient to 
result in a substantial transformation but which do not result in a 
change of classification. Comments are requested with respect to the 
extent that processing and/or assembly operations performed in those 
circumstances should be recognized as origin--conferring for purposes 
of these rules, particularly for chapters 84 through 90. 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 within 30 days of the date of publication of this notice in 
the Federal Register, in order to be considered. 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 as well as imports. 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 
Sec. 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, 
U.S. International Trade Commission, 500 E Street SW., Washington DC 
20436.

    Issued: June 26, 1997.

    By order of the Commission.
Donna R. Koehnke,
Secretary.
[FR Doc. 97-17368 Filed 7-1-97; 8:45 am]
BILLING CODE 7020-02-P