[Federal Register Volume 63, Number 180 (Thursday, September 17, 1998)]
[Rules and Regulations]
[Pages 49666-49667]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-24962]


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DEPARTMENT OF COMMERCE

International Trade Administration

15 CFR Part 303

DEPARTMENT OF THE INTERIOR

Office of Territorial and International Affairs
[Docket No. 980716178-8234-02]
RIN 0625-AA53


Limit on Duty-Free Insular Watches in Calendar Year 1999

AGENCIES: Import Administration, International Trade Administration, 
Department of Commerce; Office of Insular Affairs, Department of the 
Interior.

ACTION: Final rule.

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SUMMARY: This action amends the Departments' ITA regulations governing 
duty-exemption allocations and duty-refund entitlements for watch 
producers in the United States' insular possessions (the Virgin 
Islands, Guam, and American Samoa) and the Northern Mariana Islands. 
The amendments change the value limit for watches eligible for duty-
exemption, update the creditable wage ceiling, modify the new entrant 
invitation language and establish the total quantity and respective 
territorial shares of insular watches and watch movements which are 
allowed to enter the United States free of duty during calendar year 
1999.

EFFECTIVE DATE: September 17, 1998.

FOR FURTHER INFORMATION CONTACT: Faye Robinson, (202) 482-3526.

SUPPLEMENTARY INFORMATION: We published proposed regulatory revisions 
on July 28, 1998 (63 FR 40230) and invited comments. We received no 
comments.

    The insular possessions watch industry provision in Sec. 110 of 
Pub. L. No. 97-446 (96 Stat. 2331) (1983) as amended by Sec. 602 of 
Pub. L. No. 103-465 (108 Stat. 4991) (1994) additional U.S. Note 5 to 
chapter 91 of the Harmonized Tariff Schedule requires the Secretary of 
Commerce and the Secretary of the Interior, acting jointly, to 
establish a limit on the quantity of watches and watch movements which 
may be entered free of duty during each calendar year. The law also 
requires the Secretaries to establish the shares of this limited 
quantity which may be entered from the Virgin Islands, Guam, American 
Samoa, and the Northern Mariana Islands. Regulations on the 
establishment of these quantities and shares are contained in Secs. 
303.3 and 303.4 of title 15, Code of Federal Regulations (15 CFR 303.3 
and 303.4). The Departments establish for calendar year 1999 a total 
quantity of 3,740,000 units and respective territorial shares as shown 
in the following table:


Virgin Islands.............................................    2,240,000
Guam.......................................................      500,000
American Samoa.............................................      500,000
Northern Mariana Islands...................................      500,000
                                                                        

    The rule raises the maximum value of components for duty-free 
treatment of watches from $200 to $500 by amending Sec. 303.14(b)(3). 
This change increases the value of imported components that may be used 
in the assembly of duty-free insular watches. The increased value level 
is intended to provide the

[[Page 49667]]

producers with a greater choice in the kinds of watches they assemble, 
thereby affording them an opportunity to increase shipments and raise 
territorial employment.
    The rule also raises from $35,000 to $38,650 the maximum dollar 
amount of wages creditable in the calculation of the value of the 
production incentive certificate by amending Sec. 303.14(a)(1)(i). The 
increase in the maximum creditable wage limit is intended to keep pace 
with inflation. The ceiling was last raised in 1994.
    Finally, the amendment eliminates subparagraphs (1) and (2) of Sec. 
303.14(d) and consolidates provisions on new entrant invitations in a 
revised Sec. 303.14(d). There currently is no producer in Guam, leaving 
the Virgin Islands as the only territory with an active industry. The 
change removes the need to amend the regulations when such production 
shifts occur.
    Under the Administrative Procedure Act, 5 U.S.C. 553(d)(1), the 
effective date of this rule need not be delayed for 30 days because 
this rule relieves restrictions. The restrictions are relieved by 
raising the value limit on watches which are allowed into the United 
States free of duty and raising the creditable wage ceiling used in the 
calculation of the duty refund.
    Regulatory Flexibility Act. In accordance with the Regulatory 
Flexibility Act, 5 U.S.C. 601 et seq., the Assistant General Counsel 
for Legislation and Regulation has certified to the Chief Counsel, 
Small Business Administration, that the rule will not have a 
significant economic impact on a substantial number of small entities. 
This is because the rulemaking affects only the five watch companies 
currently participating in the insular possessions watch program, all 
of which are located in the Virgin Islands. Although there is a 
reduction of the 1999 Virgin Islands territorial share of duty-
exemption, the reduced amount still represents more than twice the 
amount of duty-free shipments used in 1997. Accordingly, the reduction 
for the 1999 annual duty-exemption for the Virgin Islands will not 
impose any cost or have any economic effect on these small companies.
    Similarly, updating the creditable wage ceiling, simplifying and 
updating the new entrant invitation language, and raising the value 
limit for watches eligible for duty-exemption will not impose any cost 
or have any other adverse economic effect on the producers.
    Paperwork Reduction Act. This rulemaking involves information 
collection activities subject to the Paperwork Reduction Act of 1980, 
44 U.S.C. 3501 et seq. which are currently approved by the Office of 
Management and Budget under control numbers 0625-0040 and 0625-0134. 
The amendments will not increase the information burden on the public.
    Notwithstanding any other provision of the law, no person is 
required to respond to, nor shall any person be subject to a penalty 
for failure to comply with a collection of information unless it 
displays a currently valid OMB Control Number.
    It has been determined that the rulemaking is not significant for 
purposes of Executive Order 12866.

List of Subjects in 15 CFR Part 303

    Administrative practice and procedure, American Samoa, Customs 
duties and inspection, Guam, Imports, Marketing quotas, Northern 
Mariana Islands, Reporting and recordkeeping requirements, Virgin 
Islands, Watches and jewelry.
    For reasons set forth above, we are amending 15 CFR Part 303 as 
follows:

PART 303 [AMENDED]

    1. The authority citation for 15 CFR Part 303 continues to read as 
follows:

    Authority: Pub. L. 94-241, 90 Stat. 263 (48 U.S.C. 1681, note); 
Pub. L. 97-446, 96 Stat. 2331 (19 U.S.C. 1202, note); Pub. L. 103-
465, 108 Stat. 4991.


Sec. 303.14  [Amended]

    2. Section 303.14(a)(1)(i) is amended by removing ``$35,000'' and 
adding ``$38,650'' in its place.
    3. Section 303.14(b)(3) is amended by removing ``$200'' and adding 
``$500'' in its place.
    4. Section 303.14(d) is revised to read as follows:


Sec. 303.14  Allocation factors and miscellaneous provisions.

* * * * *
    (d) New entrant invitations. Applications from new firms are 
invited for any unused portion of any territorial share.
* * * * *
    5. Section 303.14(e) is amended by removing ``2,640,000'' and 
adding ``2,240,000'' in its place.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration, Department of 
Commerce.
Allen Stayman,
Director, Office of Insular Affairs, Department of the Interior.
[FR Doc. 98-24962 Filed 9-16-98; 8:45 am]
BILLING CODE 3510-DS-P; 4310-93-P