[Federal Register Volume 64, Number 206 (Tuesday, October 26, 1999)]
[Rules and Regulations]
[Pages 57564-57565]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-27965]


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DEPARTMENT OF THE TREASURY

Customs Service

19 CFR Part 19

[T.D. 99-78]
RIN 1515-AC41


Customs Bonded Warehouses

AGENCY: Customs Service, Department of the Treasury.

ACTION: Final rule.

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SUMMARY: This document amends the Customs Regulations regarding the 
filing of certain inventory reports by bonded warehouse proprietors. 
Instead of requiring that these reports be filed with Customs, the 
document requires that bonded warehouse proprietors maintain these 
inventory reports after their preparation. In some instances when the 
inventory report is prepared, a letter must be submitted to Customs 
certifying that the report has been prepared. As amended, the port 
director is the Customs officer to whom certification letters must be 
submitted and to whom the annual report covering smelting or refining 
operations must be submitted. These changes and other changes made by 
this document are intended to simplify inventory recordkeeping 
procedures for warehouse proprietors. The changes are consistent with 
Customs' movement toward a post-audit environment and the spirit of 
``shared responsibility'' embodied in the Customs Modernization 
provisions of the North American Free Trade Agreement Implementation 
Act.

EFFECTIVE DATE: November 26, 1999.

FOR FURTHER INFORMATION CONTACT: Edward Bowles, Senior Auditor, 
Regulatory Audit Division, (202-927-0071).

SUPPLEMENTARY INFORMATION:

Background

    By a document published in the Federal Register (64 FR 16868) on 
April 7, 1999, Customs proposed several amendments to part 19, Customs 
Regulations (19 CFR part 19), concerning the submission to Customs of 
certain inventory reports covering merchandise in a bonded warehouse. 
Instead of requiring that certain reports be filed with Customs, the 
document proposed to amend the Customs Regulations to require that 
bonded warehouse proprietors maintain these inventory reports after 
their preparation. In certain instances, when the inventory report is 
prepared, a letter must be submitted to Customs certifying that the 
report has been prepared. Under the proposed amendment, the port 
director would be the Customs officer to whom certification letters 
would be submitted and to whom the annual report covering smelting or 
refining operations would be submitted. These proposed changes and 
other changes contained in the proposed rule were intended to simplify 
inventory recordkeeping procedures for warehouse proprietors and are 
consistent with Customs' movement toward a post-audit environment and 
the spirit of ``shared responsibility'' embodied in the Customs 
Modernization provisions of the North American Free Trade Agreement 
Implementation Act (Pub. L. 103-182).

Adoption of Proposal

    No comments were received from the public in response to the 
proposed rule. Following further consideration and review of the 
matter, Customs has determined that the proposed rule published in the 
Federal Register (64 FR 16868) on April 7, 1999, should be adopted as a 
final rule without change.

The Regulatory Flexibility Act and Executive Order 12866

    The amendments are intended to simplify inventory recordkeeping 
procedures for warehouse proprietors and be consistent with Customs' 
movement toward a post-audit environment and the spirit of ``shared 
responsibility'' embodied in the Customs Modernization provisions of 
the North American Free Trade Agreement Implementation Act. As such, 
pursuant to the provisions of the Regulatory Flexibility Act (5 U.S.C. 
601 et seq.), it is certified that the amendments will not have a 
significant economic impact on a substantial number of small entities. 
Accordingly, they are not subject to the regulatory analysis or other 
requirements of 5 U.S.C. 603 and 604. Nor do the amendments result in a 
``significant regulatory action'' under E.O. 12866.

Paperwork Reduction Act

    The collections of information contained in this rulemaking have 
been previously reviewed and approved by the Office of Management and 
Budget (OMB) in accordance with the Paperwork Reduction Act of 1995 and 
assigned the following OMB control numbers: 1515-0093 for bonded 
warehouse proprietor's submissions; 1515-0121 for information to be 
supplied by owners or lessees in support of applications to establish a 
bonded warehouse facility; 1515-0127 for applications by manufacturers 
to bond (or discontinue a previously bonded) an establishment engaged 
in the smelting or refining of metal-bearing materials; and 1515-0135 
for records of smelting or refining operations showing receipt and 
disposition of each

[[Page 57565]]

shipment of material. This document restates the collections of 
information without substantive change.
    An agency may not conduct or sponsor, and a person is not required 
to respond to, a collection of information unless it displays a valid 
control number assigned by OMB.
    Comments concerning suggestions for reducing the burden of the 
collections of information should be sent to the Regulations Branch, 
Office of Regulations and Rulings, U.S. Customs Service, 1300 
Pennsylvania Avenue, NW., 3rd Floor, Washington, DC 20229. A copy 
should also be sent to U.S. Customs Service, Information Services 
Group, Attention: J. Edgar Nichols, Room 3.2-C, 1300 Pennsylvania 
Avenue, NW., Washington, DC 20229.

List of Subjects in 19 CFR Part 19

    Customs duties and inspection, Exports, Freight, Imports, Reporting 
and recordkeeping requirements, Warehouses.

Amendments to the Regulations

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

PART 19--CUSTOMS WAREHOUSES, CONTAINER STATIONS, AND CONTROL OF 
MERCHANDISE THEREIN

    1. The general authority citation for part 19, and the relevant 
sectional authority citation, continue to read as follows:

    Authority: 5 U.S.C. 301; 19 U.S.C. 66, 1202 (General Note 20, 
Harmonized Tariff Schedule of the United States), 1624.
* * * * *
    Sections 19.17-19.25 also issued under 19 U.S.C. 1312;
* * * * *
    2. Section 19.12 is amended by revising the seventh and eighth 
sentences of paragraph (d)(3), by revising the first sentence of 
paragraph (g), adding a sentence thereafter, and revising the last 
sentence of paragraph (g), and by revising the first sentence, 
respectively, of paragraphs (h)(1) and (h)(3), to read as follows:


Sec. 19.12  Inventory control and recordkeeping system.

* * * * *
    (d) Accountability for merchandise in a warehouse. * * *
    (3) Theft, shortage, overage or damage. * * * The proprietor must 
also record all shortages and overages as required in the Customs Form 
300 or annual reconciliation report under paragraphs (g) or (h) of this 
section, as appropriate. Duties and taxes applicable to any non-
extraordinary shortage or damage and not required to be paid earlier 
must be reported and submitted to the port director no later than the 
date the certification of preparation of Customs Form 300 is due or at 
the time the certification of preparation of the annual reconciliation 
report is due, as prescribed in paragraphs (g) or (h) of this section. 
* * *
* * * * *
    (g) Warehouse proprietor submission. Except as otherwise provided 
in paragraph (h) of this section or Sec. 19.19(b) of this part, the 
warehouse proprietor must prepare a Warehouse Proprietor's Submission 
on Customs Form (CF) 300 within 45 calendar days from the end of the 
business year and maintain the Submission on file for 5 years from the 
end of the business year covered by the Submission. The proprietor must 
submit to the port director, within 10 business days after preparation 
of the CF 300, a letter signed by the proprietor certifying that the CF 
300 has been prepared, is available for Customs review, and is 
accurate. * * * An alternative format may be used for providing the 
information required on the CF 300.
    (h) Annual reconciliation. * * *
    (1) Report. Instead of preparing Customs Form 300 as required under 
paragraph (g) of this section, the proprietor of a class 2, importers' 
private bonded warehouse, and proprietors of classes 4, 5, 6, 7, 8, and 
9 warehouses if the warehouse proprietor and the importer are the same 
party, must prepare a reconciliation report within 90 days after the 
end of the fiscal year unless the port director authorizes an extension 
for reasonable cause. * * *
* * * * *
    (3) Certification. The proprietor must submit to the port director 
within 10 business days after preparation of the annual reconciliation 
report, a letter signed by the proprietor certifying that the annual 
reconciliation has been prepared, is available for Customs review, and 
is accurate. * * *
* * * * *
    3. Section 19.17 is amended by revising the first and second 
sentences of paragraph (g) to read as follows:


Sec. 19.17  Application to establish warehouse; bond.

* * * * *
    (g) Statement of inventory and bond charges. Where two or more 
smelting or refining warehouses are included under one blanket smelting 
and refining bond, an overall statement must be prepared and maintained 
by the principal named in the bond by the 28th of each month, showing 
the inventory as of the close of the preceding month, of all metals on 
hand at each plant covered by the blanket bond and the total of bonded 
charges for all plants. If the warehouses covered by an overall 
statement are located in more than one port, each port director may 
choose to verify the accuracy of the inventory report only with respect 
to that portion of the report that relates to amounts held at a plant 
that is located within that port director's jurisdiction. * * *
    4. Section 19.19 is amended by revising the first sentence of 
paragraph (b) to read as follows:


Sec. 19.19  Manufacturers' records; annual statement.

* * * * *
    (b) Every manufacturer engaged in smelting or refining, or both, 
must prepare and submit to the port director at the port nearest which 
the plant is located an annual statement for the fiscal year for the 
plant involved not later than 60 days after the termination of that 
fiscal year. * * *
Raymond W. Kelly,
Commissioner of Customs.

    Approved: September 15, 1999.
John P. Simpson,
Deputy Assistant Secretary of the Treasury.
[FR Doc. 99-27965 Filed 10-25-99; 8:45 am]
BILLING CODE 4820-02-P