[Federal Register Volume 64, Number 148 (Tuesday, August 3, 1999)]
[Rules and Regulations]
[Pages 42031-42032]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-19807]


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DEPARTMENT OF THE TREASURY

Customs Service

19 CFR Part 24

[TD 99-61]
RIN 1515-AC47


Exemption of Originating Mexican Goods From Certain Customs User 
Fees

AGENCY: U.S. Customs Service, Department of the Treasury.

ACTION: Final rule.

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SUMMARY: This document amends the Customs Regulations to reflect that 
goods imported from Mexico that qualify as originating goods under the 
North American Free Trade Agreement (NAFTA) Implementation Act (the 
Act) and qualify as goods of Mexico for marking under the NAFTA Marking 
Rules will no longer be subject to the merchandise processing fees 
assessed under 19 U.S.C. 58c(a)(9) and (10). This amendment results 
from a provision of Title II of the Act, which eliminates application 
of the fees for originating Mexican goods after June 29, 1999.

EFFECTIVE DATE: August 3, 1999.

FOR FURTHER INFORMATION CONTACT: Howard Duchan, Office of Field 
Operations (202-927-0639).

SUPPLEMENTARY INFORMATION:

Background

    Section 13031 of the Consolidated Omnibus Budget Reconciliation Act 
of 1985, as amended (codified at 19 U.S.C. 58c and referred to in this 
document as the COBRA provision), provides for the collection of 
various fees for providing Customs services in connection with the 
arrival of vessels, vehicles, railroad cars, aircraft, passengers and 
dutiable mail, in connection with the entry or release of merchandise, 
and in connection with Customs broker permits. The fees pertaining to 
the entry or release of merchandise are set forth in subsections (a)(9) 
and (10) of the COBRA provision (19 U.S.C. 58c(a)(9) and (10)) and 
include an ad valorem fee for each formal entry or release (subject to 
specific maximum and minimum limits), a surcharge for each manual entry 
or release, and specific fees for three types of informal entry or 
release.
    Title II of the North American Free Trade Agreement (NAFTA) 
Implementation Act (the Act), Pub. L. 103-182, 107 Stat. 2057 (December 
8, 1993), contains provisions relating to the administration of certain 
Customs laws. In section 204 of Title II, paragraph (10) of section 
13031(b) of the COBRA (19 U.S.C. 58c(b)(10)) was amended to provide, in 
pertinent part, that for goods qualifying under the rules of origin set 
out in section 202 of the Act (19 U.S.C. 3332 and General Note 12, 
Harmonized Tariff Schedule of the United States (HTSUS) (pertaining to 
rules of origin)), the fees under subsection (a)(9) or (10) may not be 
increased after December 31, 1993, and may not be charged after June 
29, 1999, with respect to goods that qualify to be marked as goods of 
Mexico pursuant to Annex 311 of the Act, for such time as Mexico is a 
NAFTA country (see 19 U.S.C. 58c(b)(10)(B)(ii)).
    Regulations implementing the COBRA provision regarding merchandise 
processing fees are contained in Sec. 24.23 of the Customs Regulations 
(19 CFR 24.23). Section 24.23(c)(3) pertains to an exemption from the 
merchandise processing fees (provided for under paragraphs (b)(1) and 
(b)(2)(i) of Sec. 24.23) for goods originating in Canada within the 
meaning of either General Note 9 or General Note 12 of the HTSUS, where 
such goods qualify to be marked as goods of Canada pursuant to Annex 
311 of the Act.
    Customs, in this document, amends Sec. 24.23(c)(3) to: (1) Add to 
the merchandise subject to the exemption goods originating in Mexico 
within the meaning of General Note 12, HTSUS, where such goods qualify 
to be marked as goods of Mexico pursuant to Annex 311 of the Act; (2) 
add language specifying that the exemption applies to such Mexican 
goods entered or released after June 29, 1999; and (3) remove the 
reference to General Note 9, HTSUS. Regarding the effective date, this 
exemption will apply to qualifying Mexican goods ``entered or 
released'' after June 29, 1999, within the meaning of that term as 
defined in Sec. 24.23(a)(2) and 19 U.S.C. 58c(b)(8)(E). Regarding 
removal of the reference to General Note 9, HTSUS, this General Note 
pertained to the Canadian Free Trade Agreement which is suspended. 
Consequently, reference to it is no longer relevant for purposes of the 
section.

Inapplicability of Public Notice and Comment and Delayed Effective 
Date Requirements

    Pursuant to the provisions of 5 U.S.C. 553(b)(B), Customs has 
determined that prior public notice and comment procedures on this 
regulation are unnecessary. The regulatory change conforms the Customs 
Regulations to the terms of a statutory provision that is already in 
effect. In addition, the regulatory change benefits the public by 
providing specific information regarding the right to an exemption from 
the payment of certain import fees. Pursuant to the provisions of 5 
U.S.C. 553(a)(1), public notice and comment is also inapplicable to 
this final regulation because it is within the foreign affairs function 
of the United States. For the same reasons, pursuant to the provisions 
of 5 U.S.C. 553(d)(1) and (3), Customs finds that there is good cause 
for dispensing with a delayed effective date.

Executive Order 12866

    This document does not meet the criteria for a ``significant 
regulatory action'' as specified in E.O. 12866.

Regulatory Flexibility Act

    Because no notice of proposed rulemaking is required for this rule, 
the provisions of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) 
do not apply.

Drafting Information

    The principal author of this document was Bill Conrad, Office of 
Regulations and Rulings, U.S. Customs Service. However, personnel from 
other offices participated in its development.

List of Subjects in 19 CFR Part 24

    Accounting, Claims, Customs duties and inspection, Taxes, User 
fees, Wages.

Amendment to the Regulations

    For the reasons stated in the preamble, part 24 of the Customs 
Regulations (19 CFR Part 24) is amended as set forth below.

PART 24--CUSTOMS FINANCIAL AND ACCOUNTING PROCEDURE

    1. The authority citation for part 24 continues to read in part, 
and a new authority citation for Sec. 24.23 is added to read, as 
follows:

    Authority: 5 U.S.C. 301; 19 U.S.C. 58a-58c, 66, 1202 (General 
Note 20, Harmonized Tariff Schedule of the United States), 1450, 
1624; 31 U.S.C. 9701.
* * * * *
    Section 24.23 also issued under 19 U.S.C. 3332;
* * * * *
    2. Section 24.23(c)(3) is revised to read as follows:


Sec. 24.23   Fees for processing merchandise.

* * * * *
    (c) Exemptions and limitations. * * *

[[Page 42032]]

    (3) The ad valorem, surcharge, and specific fees provided for under 
paragraphs (b)(1) and (b)(2)(i) of this section shall not apply to 
goods originating in Canada or Mexico within the meaning of General 
Note 12, HTSUS (see also 19 U.S.C. 3332), where such goods qualify to 
be marked, respectively, as goods of Canada or Mexico pursuant to Annex 
311 of the North American Free Trade Agreement and without regard to 
whether the goods are marked. For qualifying goods originating in 
Mexico, the exemption applies to goods entered or released (as defined 
in this section) after June 29, 1999. Where originating goods as 
described above are entered or released with other goods that are not 
originating goods, the ad valorem, surcharge, and specific fees shall 
apply only to those goods which are not originating goods.
* * * * *
    Approved: June 14, 1999.
Raymond W. Kelly,
Commissioner of Customs.
John P. Simpson,
Deputy Assistant Secretary of the Treasury.
[FR Doc. 99-19807 Filed 8-2-99; 8:45 am]
BILLING CODE 4820-02-U