[Federal Register Volume 64, Number 61 (Wednesday, March 31, 1999)]
[Rules and Regulations]
[Pages 15301-15302]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-7916]


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DEPARTMENT OF THE TREASURY

Customs Service

19 CFR Part 4

[T.D. 99-32]


Addition of Brazil to the List of Nations Entitled to Reciprocal 
Exemption from the Payment of Special Tonnage Taxes

AGENCY: Customs Service, Department of the Treasury.

ACTION: Final rule.

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SUMMARY: This document amends the Customs Regulations to include Brazil 
in the list of nations whose vessels are entitled to reciprocal 
exemption from the payment of special tonnage taxes and light money. 
Brazil was recently removed from the list because the Department of 
State had informed Customs that Brazil had implemented a law 
discriminating against U.S. vessels in its preferential tax treatment 
of cargoes carried on certain specially-registered Brazilian vessels. 
However, the Department of State now informs Customs that recent 
actions by the Brazilian government have effectively eliminated this 
discriminatory tax treatment; thus, Brazil now qualifies for the 
exemption. Accordingly, Customs is restoring the exemption privileges 
to vessels of Brazil.

EFFECTIVE DATE: This amendment is effective, and the reciprocal 
privileges are restored to all Brazilian-registered vessels, as of 
March 31, 1999.

FOR FURTHER INFORMATION CONTACT:
    Gerry O'Brien, Entry Procedures and Carriers Branch, (202-927-
2320).
SUPPLEMENTARY INFORMATION:

Background

    Generally, the United States imposes regular and special tonnage 
taxes, and a duty of a specified amount per ton denominated ``light 
money,'' on all foreign vessels which enter U.S. ports (46 U.S.C. App. 
121 and 128).
    Vessels of a foreign nation, however, may be exempted from the 
payment of such special tonnage taxes and light money upon presentation 
of satisfactory proof that no discriminatory duties of tonnage or 
impost are imposed by that foreign nation on U.S. vessels or their 
cargoes (46 U.S.C. App. 141).
    The list of nations whose vessels have been found to be 
reciprocally exempt from the payment of any higher tonnage duties than 
are applicable to vessels of the U.S. and from the payment of light 
money is found at Sec. 4.22, Customs Regulations (19 CFR 4.22). Nations 
granted these commercial privileges that subsequently impose 
discriminatory

[[Page 15302]]

duties are subject to retaliatory suspension of the exemption from 
payment of special tonnage tax and light money (46 U.S.C. App. 141).
    Brazil had previously been included in the list of nations in 
Sec. 4.22 whose vessels are exempt from the payment of special tonnage 
taxes and light money (see T.D. 95-14, 60 FR 6966, dated February 6, 
1995). However, Brazil was recently removed from the list because the 
Department of State had informed Customs that Brazil had enacted a law 
that discriminated against U.S. vessels and the vessels of other 
countries in its preferential tax treatment of cargoes carried by 
certain specially-registered Brazilian vessels (see T.D. 98-79, 63 FR 
52967, dated October 2, 1998). Specifically, under that law, the 
dutiable value of imported merchandise carried by the specially-
registered Brazilian vessels did not include freight charges, while 
identical imports carried by U.S. vessels or the vessels of other 
countries were subject to duty on freight charges. This violated the 
reciprocal nature of the exemption privilege granted, and, as such, 
Brazil no longer qualified for the exemption.
    However, the Department of State has now informed Customs that the 
Brazilian government has since effectively eliminated the 
discriminatory tax treatment in question and that both the Department 
of State and the Department of Transportation's Maritime Administration 
support the restoration of Brazil to the list of nations whose vessels 
are exempt from the payment of special tonnage taxes and light money.
    As a result, the Department of State, in accordance with 46 U.S.C. 
App. 141 and Executive Order 10289 of September 17, 1951 (16 FR 9499, 3 
CFR 1949-1953 Comp. p. 787, as amended, see 3 U.S.C.A. 301 note), has 
recommended to the Secretary of the Treasury, through Customs, that 
Brazil be restored to the list of nations in Sec. 4.22.

Finding

    The Customs Service has determined that the vessels of Brazil are 
exempt from the payment of special tonnage taxes and light money, 
effective as of March 31, 1999, and that Sec. 4.22 of the Customs 
Regulations should be amended accordingly. The authority to amend this 
section of the Customs Regulations has been delegated to the Chief, 
Regulations Branch.

The Regulatory Flexibility Act, Executive Order 12866 and 
Inapplicability of Public Notice and Comment and Delayed Effective 
Date Requirements

    Because this amendment concerns a foreign affairs function of the 
United States, merely implements a statutory mandate, and involves a 
matter in which the general public has no significant interest, 
pursuant to 5 U.S.C. 553, notice and public procedure in this case are 
considered unnecessary; further, for the same reason, good cause exists 
for dispensing with a delayed effective date under 5 U.S.C. 553(d)(3). 
Since this document is not subject to the notice and public procedure 
requirements of 5 U.S.C. 553, it is not subject to the provisions of 
the Regulatory Flexibility Act (5 U.S.C. 601 et seq.). Nor does the 
amendment meet the criteria for a ``significant regulatory action'' 
under E.O. 12866.

List of Subjects in 19 CFR Part 4

    Cargo vessels, Customs duties and inspection, Entry, Maritime 
carriers, Vessels.

Amendment to the Regulations

    Part 4, Customs Regulations (19 CFR part 4), is amended as set 
forth below.

PART 4--VESSELS IN FOREIGN AND DOMESTIC TRADES

    1. The general and relevant specific authority citations for part 4 
continue to read as follows:

    Authority: 5 U.S.C. 301; 19 U.S.C. 66, 1431, 1433, 1434, 1624; 
46 U.S.C. App. 3, 91.
* * * * *
    Section 4.22 also issued under 46 U.S.C. App. 121, 128, 141;
* * * * *


Sec. 4.22   [Amended]

    2. Section 4.22 is amended by adding ``Brazil'', in appropriate 
alphabetical order, to the list of nations entitled to exemption from 
special tonnage taxes and light money.

    Dated: March 26, 1999.
Harold M. Singer,
Chief, Regulations Branch.
[FR Doc. 99-7916 Filed 3-30-99; 8:45 am]
BILLING CODE 4820-02-P