[Federal Register Volume 66, Number 150 (Friday, August 3, 2001)]
[Proposed Rules]
[Pages 40649-40659]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-19337]



[[Page 40649]]

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DEPARTMENT OF THE TREASURY

Customs Service

19 CFR Parts 122 and 123

RIN 1515-AC73


Private Aircraft Programs: Establishment of the General Aviation 
Telephonic Entry (GATE) Program and Revisions to the Overflight Program

AGENCY: Customs Service, Treasury.

ACTION: Notice of proposed rulemaking.

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SUMMARY: This document proposes to amend the Customs Regulations to 
provide for the GATE Program--a voluntary program designed to 
facilitate Customs processing of certain pre-qualified frequent 
travelers on pre-registered general aviation aircraft arriving in the 
United States directly from Canada. This document also discusses 
Customs evaluation of the GATE Program tests which were conducted to 
determine whether to propose GATE as a regular Customs program. The 
proposed amendments provide that GATE participants that are in 
compliance with the program's requirements are exempted to some degree 
from the general Customs requirements concerning entry into the United 
States.
    This document also proposes to amend the Customs Regulations 
regarding the Overflight Program that exempts certain private aircraft 
arriving in the continental United States via certain areas south of 
the United States from the special landing requirements applicable to 
such aircraft. The proposed amendments will modify the application 
process to standardize and streamline the information required and to 
provide for centralized processing of requests for overflight 
privileges. This will reduce the processing time of applications, 
without compromising Customs drug enforcement responsibilities.
    These proposed regulatory changes are designed to allow inspection 
resources to be relocated where they are most effective.

DATES: Comments must be received on or before October 2, 2001.

ADDRESSES: Written comments may be addressed to, and inspected at, U.S. 
Customs Service, Office of Regulations and Rulings--Regulations Branch, 
1300 Pennsylvania Avenue, NW--3rd Floor, Washington, D.C. 20229.

FOR FURTHER INFORMATION CONTACT: Steve Gilbert, Office of Field 
Operations, Passenger Programs Division, (202) 927-1391.

SUPPLEMENTARY INFORMATION:

Background

General Customs Requirements Concerning Entry Into the United States 
(Report of Arrival and Landing, Inspection, and Clearance Requirements)

    In general, except as otherwise authorized by the Secretary, all 
individuals entering the United States are required to (1) enter only 
at designated border crossing points, (2) immediately report their 
arrival to Customs (and other Federal inspection agencies, such as the 
Immigration and Naturalization Service (INS), that have reporting 
requirements), and (3) present themselves and their vehicle, and all 
persons and merchandise (including baggage) on board, for inspection at 
the designated Customs facility, and may not depart from the designated 
facility until authorized to do so by the appropriate Customs officer. 
See 19 U.S.C. 1433 and 1459. Failure to report such arrival and make 
such presentation for inspection may result in the individual being 
liable for certain civil and criminal penalties. See 19 U.S.C. 1459, 
1436, and 1497. These general Customs requirements concerning entry, 
which include the reporting of arrival, landing, inspection, and 
clearance requirements, applicable to individuals and aircraft entering 
the U.S. are provided for in Parts 122 and 123 of the Customs 
Regulations (19 CFR Parts 122 and 123). In general, aircraft arriving 
in the U.S. from a foreign area must give advance notice of arrival, as 
required by Sec. 122.31 of the Customs Regulations (19 CFR 122.31).
    Certain private aircraft that arrive in the continental U.S. via 
certain areas south of the U.S. are subject to special report of 
arrival and landing requirements. Such aircraft must give advance 
notice of their intended arrival at least one hour before crossing the 
U.S. coastline or border, see, Sec. 122.23(b) of the Customs 
Regulations (19 CFR 122.23(b)), and land at airports nearest to the 
coastline or border crossing point designated for Customs processing, 
see Sec. 122.24 of the Customs Regulations (19 CFR 122.24), unless 
exempted from these requirements in accordance with the provisions of 
Sec. 122.25 of the Customs Regulations (19 CFR 122.25).
    This document concerns two private aircraft programs: the General 
Aviation Telephonic Entry (GATE) Program, which concerns general 
aviation aircraft arriving the United States directly from Canada, and 
the Overflight Program, which concerns certain private aircraft 
arriving in the continental United States from areas south of the 
United States. This document proposes to amend the Customs Regulations 
by modifying the existing Overflight Program and by establishing a new 
permanent GATE Program.

I. The GATE Program

Facilitated Arrival and Clearance of General Aviation Aircraft Through 
the General Aviation Telephonic Entry (GATE) Program

    Customs and other U.S. border-enforcement agencies frequently 
design and test programs that aim to facilitate the processing of 
certain, non-importing, frequent travelers arriving in the United 
States; such travelers pose low risks to these agencies' law-
enforcement responsibilities. (See T.D. 97-48 (62 FR 32030, June 12, 
1997), which makes provision for certain technologically-innovative, 
land-border inspection programs, collectively known as the Port 
Passenger Accelerated Service System (PORTPASS).) Participation in 
these kinds of programs is voluntary and requires participants to agree 
to the program's requirements, which include the pre-filing of certain 
personal information and requires the participant to arrive in the U.S. 
only at designated locations. In exchange for this cooperation, 
participants are exempted to some degree from the general Customs 
requirements concerning entry into the United States set forth at 19 
CFR 123.1.
    Historical data on certain general aviation aircraft (private 
aircraft and certain commercial aircraft, consisting of small charter/
air taxi aircraft and air ambulances that have a seating capacity for 
fifteen or fewer individuals, when such aircraft are not in commercial 
service) arriving in the United States directly from Canada indicates a 
high degree of compliance with Customs and other federal agency 
reporting laws. Based on this history and pursuant to the U.S.-Canada 
Shared Border Accord, Customs developed the General Aviation Telephonic 
Entry (GATE) Program. The GATE Program was designed to facilitate 
Customs processing of certain frequent travelers (low-risk and pre-
qualified) on selected flights (pre-registered) of general aviation 
aircraft by allowing the aircraft to report its arrival information 
telephonically and by Customs generally pre-clearing the flight: upon 
landing the frequent travelers may depart the aircraft with their 
personal effects at the time of arrival reported. Random inspections 
also were built into the program. Thus, the GATE Program

[[Page 40650]]

was designed to combine the proven benefits of facilitating the arrival 
and clearance of those low-risk frequent travelers that choose to 
participate in this voluntary program with inspection selectivity, so 
that Customs inspectional resources could be utilized where they are 
most effective.

GATE Program Tests Conducted

    For programs designed to evaluate the effectiveness of new 
technology or operations procedures regarding the processing of 
passengers, vessels, or merchandise, Sec. 101.9(a) of the Customs 
Regulations (19 CFR 101.9(a)), implements the general testing 
procedures. The general testing of the GATE Program--to evaluate the 
effectiveness of the new operations procedure--was established pursuant 
to that regulation.
    On November 4, 1996, Customs implemented the GATE Program test for 
one year (see 61 FR 46902, dated September 5, 1996). The initial test 
allowed certain pre-registered, passenger-carrying flights of certain 
general aviation aircraft to report their arrival telephonically when 
entering the United States directly from Canada. If all the information 
regarding the GATE flight met the program's requirements, then Customs 
assigned an advance arrival number which gave permission for that 
flight to land at a GATE-designated airport. The test was implemented 
at designated airports of entry located nationwide.
    Although the initial test was to be open to all qualified flights 
along the northern border, many eligible flights could not participate 
in the GATE Program test due to personnel constraints and other 
matters. Accordingly, because an evaluation of the initial test yielded 
only partial results and an analysis of comments received showed a 
willingness by the traveling community to participate in GATE if only 
the program were more readily available, on July 6, 1998 (see 63 FR 
36483), Customs announced its plan to conduct a second test of GATE for 
one year, beginning August 5, 1998. The second test expanded the scope 
of participation to include ports with one full-time inspector and 
additional flights of certain commercial aircraft (small charter/air 
taxi aircraft returning with flight crew members only).
A. Evaluation of GATE Tests
    Customs evaluated the GATE Program tests by developing certain 
performance criteria and measuring over time the test population's 
overall compliance rating with these performance criteria against 
baseline measurements.
    Overall, 235 airports were designated for GATE Program use and 
2,982 aircraft participated in the two GATE Program tests. The data was 
collected over the period from September 1996 to September 1999.
B. Evaluation Process
    To evaluate the achievement of the program tests, Customs 
established two performance criteria to measure such operational issues 
as whether participants met the requirements concerning advance 
notification and complete declarations. Baseline compliance 
measurements for each aircraft were recorded and subsequent compliance 
measurements were taken monthly and averaged quarterly. To evaluate the 
various performance statistics, the raw data was compiled and the 
following factor ratings were used in measuring participant's 
compliance:
    If the criterion was met 100% of the time, an ``Excellent'' rating 
was ascribed;
    If the criterion was met 90-99% of the time, a ``Good'' rating was 
ascribed; and
    If the criterion was met less than 90% of the time, a ``Poor'' 
rating was ascribed.
C. Performance Criteria and Results of Evaluation
    Customs evaluation of the GATE Program tests is based on the 
proficiency results of the 2,982 aircraft that participated in meeting 
the following performance criteria:
    Criterion A measured the number of seizures resulting from 
attempted importation of prohibited or undeclared articles. Two surveys 
were conducted to determine the compliance rate for this criterion: the 
first, conducted between October 1, 1997-October 31, 1998, showed an 
overall compliance rating of 100%, and the second, conducted between 
April 1, 1999-June 30, 1999, similarly showed an overall compliance 
rating of 100%, which constitutes an ``Excellent'' rating for this 
criterion.
    Criterion B measured the number of other violations, such as 
failure to timely report arrival. Again, two surveys were conducted to 
determine the compliance rate for this criterion: the first, conducted 
between October 1, 1997-October 31, 1998, showed an overall compliance 
rating of 100%, and the second, conducted between April 1, 1999-June 
30, 1999, similarly showed an overall compliance rating of 100%, which 
constitutes an ``Excellent'' rating for this criterion.
    In addition to these favorable compliance ratings, Customs received 
many comments from participants stating that the GATE Program was an 
effective procedure for expediting the processing of certain flights 
carrying low-risk frequent travelers arriving in the United States.
    Overall, an ``Excellent'' compliance rating was scored by the 
participants, which convinces Customs that the program tests were 
successful and that GATE achieved its quicker processing and law-
enforcement objectives.

Proposed Amendments to the Regulations to Implement the GATE Program

    Owing to the favorable comments and evaluations received concerning 
the testing of the GATE Program, Customs is proposing regulations to 
implement the GATE Program on a permanent basis. To make provision for 
the GATE Program, it is proposed in this document to amend the Customs 
Regulations at Part 122, which contains Air Commerce Regulations 
applicable to private aircraft, and at Part 123, which pertains to 
Customs relations with Canada and Mexico and contains the general 
report of arrival requirements applicable to individuals. In Part 122, 
a new Sec. 122.39 will be added that explains the specifics of the GATE 
Program. Conforming reference changes also will be made to 
Secs. 122.22, 122.24, 122.26, 122.31, and 122.36. In Part 123, 
Sec. 123.1 will be revised to reference the GATE Program.
    Customs notes that the test notices referenced both ``private'' and 
``corporate'' aircraft as ostensibly separate types of aircraft. In 
these proposed regulations, because ``corporate aircraft'' are 
encompassed within the definition of ``private aircraft'' in 19 CFR 
122.1(h) and private aircraft are included within the description of 
aircraft eligible for the GATE Program, there is no need to provide 
separately for corporate aircraft. Customs also notes that although the 
test notices stated that the GATE Program was concerned with allowing 
qualified flights to telephonically report their ``entry'' into the 
U.S., technically, these flights were reporting their ``arrival'', 
which is the nature of the reporting exemption proposed at 
Sec. 123.1(a)(2). Also, because ``private aircraft'' are exempt from 
formal entry requirements, see 19 CFR 122.26, the proposed regulatory 
text references ``arrival and clearance'' requirements and not 
``entry'' requirements.

Discussion of Proposed New Section 122.39

Section 122.39(a)--``Description of Program''

    Under the heading ``Description of program'', paragraph (a) will 
describe

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the GATE Program in general terms. It will provide that this program is 
designed to facilitate the processing of certain pre-qualified frequent 
travelers on pre-registered general aviation aircraft arriving in the 
United States directly from Canada; that participation in the GATE 
Program is voluntary and requires participants to comply with the 
program's requirements, which include the pre-filing of certain 
personal information and arriving in the U.S. only at designated 
locations; and that in exchange for this cooperation, participants are 
exempted from the general Customs requirements for entry into the 
United States, so long as the participants are in compliance with the 
program's requirements. This paragraph also will caution that 
participants should be aware that failure to follow program 
requirements on GATE-approved flights can result in revocation of their 
participation in the program and may result in their being liable for 
certain civil and criminal penalties. It further provides that, 
although applications may be approved for a period of years, particular 
flights may be denied GATE privileges because of the further conditions 
pertaining to landing rights airports, found at Sec. 122.14(d).
    Paragraph (a) also will explain the modified arrival procedure of 
the GATE Program: that the pilot of the GATE-approved flight provides 
Customs with the required advance notice of the flight's arrival; that 
Customs then gives the GATE flight an advance arrival number which 
gives permission for the flight to land at an airport which has been 
designated for program use; and that upon landing in the U.S., the 
participants on board may depart the aircraft with their personal 
effects. However, if the flight is ahead of schedule, then all 
individuals must remain onboard the aircraft until the time of arrival 
that was reported. See 19 U.S.C. 1433(e) and 1454. Because the 
individuals on GATE-approved flights are to be pre-cleared 
telephonically, all individuals onboard must be participants in the 
GATE Program and in compliance with the program's requirements. This 
facilitated processing procedure is in lieu of the general Customs 
requirements concerning entry into the U.S., contained at Sec. 123.1 of 
the Customs Regulations.

Section 122.39(b)--``Eligibility and Application Procedures''

    Under the heading ``Eligibility and application procedures'', 
paragraph (b) will explain both the eligibility criteria of individual 
frequent travelers, general aviation aircraft, and designated airports, 
and the application procedure that only the aircraft owners/operators 
must follow. Although three entities (aircraft, airports, and 
individual frequent travelers) are separately identified as being 
eligible to participate in the GATE Program, the association between 
eligible general aviation aircraft and individual frequent travelers is 
very direct: the individuals to be carried on the aircraft must be 
either members of the flight crew, corporate employees/officers, or the 
pilot of the aircraft.
    Regarding aircraft eligibility, only U.S.-and Canadian-registered 
general aviation aircraft that arrive in the United States directly 
from Canada are eligible to participate in the GATE Program. Aircraft 
transiting Canada and aircraft that will carry cargo, merchandise 
requiring the payment of Customs duties or merchandise that is 
restricted or prohibited, or monetary instruments in excess of $10,000 
are not eligible to participate in the GATE Program. For GATE Program 
purposes, the term ``general aviation aircraft'' means private 
aircraft, and certain commercial aircraft, consisting of small charter/
air taxi aircraft and air ambulances that have a seating capacity for 
fifteen or fewer individuals, when such aircraft are not in commercial 
service. Aircraft accepted into the GATE Program maintain their 
eligibility status so long as they make at least one flight per year.
    Regarding airports, eligible flights must land at airports that are 
designated for GATE use. While airports already designated for GATE use 
are generally within a port of entry, other airports located outside of 
a port of entry also may be approved for GATE use. If an airport which 
is not already designated for GATE use is requested on a GATE 
application, the requested airport will be reviewed by the local port 
director, who will take the following factors into consideration in 
determining whether to approve the airport for GATE use:
    a. Willingness of the airport operator to participate in the GATE 
Program;
    b. The distance to the airport from the nearest Customs port of 
entry (so that random inspections can be performed), commuting time 
required for Customs officers, and Customs officer safety en route to 
the airport;
    c. Whether a secure place to work is provided at the airport; and
    d. Whether communications equipment is accessible.
    Regarding the eligibility of individual frequent travelers, only 
U.S. citizens, permanent resident aliens of the United States, Canadian 
citizens, or landed immigrants in Canada from Commonwealth countries 
who are either members of the flight crew, corporate employees/
officers, or the pilot of the general aviation aircraft are eligible to 
participate in the GATE Program. Each individual must demonstrate his 
right to be legally admitted into the United States by passing a 
``face-to-face'' inspection with either a U.S. Immigration or Customs 
officer. Further, on GATE-approved flights each individual must agree 
to carry all required personal identification and immigration documents 
and not to carry merchandise that requires the payment of Customs 
duties or merchandise that is restricted or prohibited, or monetary 
instruments in excess of $10,000.
    Applications for GATE are to be submitted only by eligible general 
aviation aircraft owners/operators who want all or certain of their 
flights considered for participation in the GATE Program. An 
application is filed on new Customs Form (CF) 442 (Application for 
Exemption from Special Landing Requirements (Overflight) or General 
Aviation Telephonic Entry Program (GATE)). Copies of the new CF 442 are 
available at any Customs port. The following specific information is 
required to be submitted on the CF 442: the name of the aircraft owner/
operator applicant; identification of the aircraft to be flown; 
identification of the airport(s) of intended landing in the U.S.; and 
the names and other personal identification information of individual 
frequent travelers, which include the pilot of the aircraft, the 
members of the flight crew, and corporate employees/officers intended 
to be carried onboard GATE-approved flights. The CF 442 also contains a 
statement which the applicant is required to sign that certifies the 
truthfulness of the information provided, authorizes Customs to perform 
whatever checks and inspections as are necessary to verify the 
information provided, and states that the applicant acknowledges having 
read the program's requirements, agrees to abide by them, and 
understands that failure to follow such requirements on GATE-approved 
flights can render participants liable for certain civil and criminal 
penalties. By signing and submitting a CF 442, an aircraft owner/
operator acknowledges that individual frequent travelers identified 
have been informed of the program's requirements and the penalties for 
failure to comply with these requirements, and agrees that a 
participating aircraft will not carry individuals who are not approved 
and that frequent travelers onboard will not be allowed to carry 
merchandise that

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requires the payment of Customs duties or merchandise that is 
restricted or prohibited, or monetary instruments in excess of $10,000 
on GATE-approved flights.
    Individual frequent travelers who wish to participate in the 
program on aircraft of eligible general aviation aircraft owners/
operators do not file a CF 442; they provide their personal 
identification information to the aircraft owner/operator who includes 
the information on his CF 442. Individual frequent travelers who 
provide their personal information for inclusion on an aircraft 
owner's/operator's CF 442 must sign a Privacy Act waiver provided to 
them by the aircraft owner/operator that authorizes Customs to perform 
whatever checks are necessary to determine their eligibility for 
participation in the program and to advise the aircraft owner/operator 
as to whether the individual is approved. Customs will verify 
information through the Treasury Enforcement Communications System 
(TECS). The waiver is to be submitted to the aircraft owner/operator 
who will forward all the individual Privacy Act waivers with his CF 442 
to Customs. Individuals approved by Customs to participate in the GATE 
Program must abide by the program's requirements and not carry 
merchandise that requires the payment of Customs duties or merchandise 
that is restricted or prohibited, or monetary instruments in excess of 
$10,000 on GATE-approved flights.
    Applications for GATE with the individual frequent traveler's 
signed Privacy Act waiver attached are to be filed with the GATE 
Program Center--U.S. Customs Service, Detroit Metropolitan Airport, 
GATE Program Center, International Terminal, Detroit, Michigan 48242. 
In general, applications must be submitted to the GATE Program Center 
at least 30 days prior to the date of the first scheduled flight and 
addenda or modifications reflecting material changes must be submitted 
at least 30 days prior to the date of the flight for which the changes 
are in effect. (Although the time frame for submitting applications was 
45 days prior to the date of the scheduled flight during the test 
phases of this program, Customs considers a 30-day time frame 
sufficient to process applications.)

Section 122.39(c)--``Notice of Action on Application; Appeal Rights''

    Under the heading ``Notice of action on application; appeal 
rights'', paragraph (c) will explain Customs notification procedure 
following its evaluation of an application to participate in the GATE 
Program. This paragraph will provide that the GATE Program Center 
determines whether the information provided on the CF 442 meets the 
various eligibility criteria, and notifies the aircraft owner/operator-
applicant within 30 days as to whether the application is approved or 
denied. Paragraph (c) will also delineate the specific grounds for not 
approving an application. Finally, the paragraph will reference the 
various administrative appeal procedures that general aviation aircraft 
owner/operator-applicants must follow to challenge Customs initial 
notice of denial (and any subsequent adverse determinations that may be 
issued). Individual frequent travelers designated by applicants will 
have no direct appeal rights.
    In cases where certain of multiple frequent travelers listed on the 
CF 442 are not approved, those not approved will be lined out by the 
GATE Program Center and the overall application will be approved. In 
cases where either the aircraft, the owner/operator of the aircraft, or 
the pilot is not approved, then the GATE Program Center will deny the 
application. The applicant may then either submit a new application 
after waiting a period of 30 days from the date of issuance of the 
initial notice of denial or exercise its appeal rights. (The appeal 
procedure actually will be provided at paragraph (d), but is discussed 
here for convenience.)
    The appeal procedure will allow for two levels of administrative 
review. The first level of appeal will be to the Detroit Port Director 
and the appeal must be filed within 10 calendar days of the date of 
issuance of the initial notice of denial. Within 30 days of receipt of 
the appeal, the Detroit Port Director, or his designee, will make a 
determination regarding the appeal and notify the appellant of the 
decision in writing. If the appeal to the Detroit Port Director results 
in an adverse determination, then a second level of appeal may be taken 
to the Assistant Commissioner, Office of Field Operations, U.S. Customs 
Service, 1300 Pennsylvania Avenue, Washington, D.C. 20229, provided the 
appeal is filed within 10 calendar days of the date of issuance of the 
Detroit Port Director's adverse determination. Within 30 days of 
receipt of the appeal, the Assistant Commissioner, or his designee, 
will make a determination regarding the appeal and notify the appellant 
of the decision in writing. If the appeal to the Assistant Commissioner 
again results in an adverse determination, no further administrative 
recourse is available.
    If an application designates multiple airports for landing and some 
of the airports cannot be approved for GATE use, the application will 
be approved for GATE participation and the unapproved airports will be 
lined out. If an application designates only one airport for landing 
and that airport cannot be approved for GATE use, the application will 
be approved and the nearest GATE-approved airport will be designated 
for the applicant. Regarding airport designations, no appeal is 
available.

Section 122.39(d)--``Notice of Revocation; Appeal Procedures''

    Under the heading ``Notice of revocation; appeal procedures'', 
paragraph (d) will delineate the specific reasons participation in the 
GATE Program may be immediately revoked and explain the two levels of 
administrative appeal procedure, discussed above, common to both 
nonselected applicants and revoked participants who want to challenge 
Customs initial notices of action in the matter. An aircraft's 
participation in the GATE Program may be immediately revoked by the 
GATE Program Center for any of the following reasons:
    (1) The application contained false or misleading information 
concerning a material fact;
    (2) An approved individual:
    (a) Is subsequently indicted for, convicted of, or has committed 
acts which would constitute any felony or misdemeanor under United 
States Federal or State law. In the absence of an indictment, 
conviction, or other legal process, Customs must have probable cause to 
believe proscribed acts occurred. This provision will also apply to the 
owner/ operator of the aircraft;
    (b) Allows an unauthorized individual to use his GATE certificate 
or other approved form of identification;
    (c) Refuses or otherwise fails to follow any proper order of a 
Customs officer or any Customs order, rule, or regulation; or
    (d) Fails to adhere to the conditions or restrictions imposed by 
the GATE Program;
    (3) Reasonable grounds exist to believe that Federal rules and 
regulations pertaining to public health or safety, Customs, or other 
inspectional activities have not been followed; or
    (4) Continuation of GATE privileges would endanger the revenue or 
otherwise invite circumvention of laws enforced by Customs.
    When a decision revoking participation has been made, the Gate 
Program Center will notify the aircraft owner/operator-participant of 
the decision in writing. The notice of revocation will state the 
reason(s) for revocation and advise the participant of its 
administrative appeal rights and

[[Page 40653]]

alternate recourse of submitting a new application after waiting a 
period of 30 days from the date of issuance of the initial notice of 
revocation or any subsequent adverse determination.

II. The Overflight Program

    Although special report of arrival and landing requirements are 
applicable to private aircraft that arrive in the continental U.S. from 
areas south of the U.S. (19 CFR 122.23-122.24), private aircraft owners 
or operators may seek an exemption from the special landing 
requirements (overflight privileges), for either a single flight or for 
a number of flights over a period of one year, by filing a written 
request with the port director having jurisdiction over the airport 
designated for landing, as provided by Sec. 122.25. The processing of 
requests for exemption(s) and the revocation of overflight privileges 
are administered by the Overflight Program.
    Various amendments are proposed to the regulations concerning the 
Overflight Program. The present overflight regulatory procedure does 
not provide for the uniform processing of exemption requests. Requests 
for exemption(s) frequently contain nonstandardized information and are 
processed differently across the country. Customs is proposing to amend 
the overflight provisions at Sec. 122.25 to provide for a more uniform 
approach to collecting information. Certain information regarding 
business activity is no longer considered necessary and the requirement 
to provide justification for the exemption sought are proposed to be 
removed. It is also proposed to provide for a centralized location--
Newark International Airport in New Jersey--to process applications for 
exemptions. In addition, advance notification requirements are proposed 
to be changed. Section 122.25(a) currently provides that aircraft 
traveling under an exemption must continue to follow the advance notice 
requirements of Sec. 122.23(b), which provide that the aircraft furnish 
the notice of intended arrival to Customs at the nearest designated 
airport to the point of crossing listed at Sec. 122.24(b). Customs is 
proposing that the advance notice of arrival from exempted aircraft be 
made to the airport to which the aircraft is destined rather than to 
the nearest landing airport, designated by Sec. 122.24(b), from which 
the aircraft has been exempted. Amendments are also proposed concerning 
the duration of term exemptions. Also, Customs proposes an appeal 
procedure similar to that already discussed under the proposed GATE 
regulations, so that private aircraft owners/operators either 
requesting an exemption from the special landing requirements and being 
denied or having an approved exemption revoked can have administrative 
review of such decisions.
    Conforming reference changes also will be made to Secs. 122.22 and 
122.24.

Discussion of Proposed Amendments to Sec. 122.25

Section 122.25(a)--``Description of Overflight Program''

    In Sec. 122.25, the heading of paragraph (a), currently entitled 
``Request'', will be amended to read ``Description of Overflight 
Program'' to explain the program in general terms. Revisions to the 
regulatory text will more clearly show that exemptions can be requested 
by eligible private aircraft owner/operators (applicants) either for a 
single flight or for a number of flights over a period of two years 
(increased from one year). Further, these regulations will clarify that 
failure to follow program requirements can result in revocation of 
overflight privilege(s) and liability for certain civil and criminal 
penalties.
    Paragraph (a) will more clearly describe the scope of the 
overflight privilege. It will provide that an exemption (overflight 
privileges) from the special landing requirements is available and 
specify the advance report of arrival procedures regarding when, where, 
and how Customs must be notified. Further, this paragraph will set 
forth the conditions and continuing responsibilities of aircraft 
owners/operators whose private aircraft have been granted an overflight 
privilege; this information is currently provided for at paragraphs (b) 
and (d).
    Paragraph (a) will also inform participants that, although their 
applications may be approved for a period of years, particular flights 
may be denied because of the further conditions pertaining to landing 
rights airports, found at Sec. 122.14(d). Lastly, the current 
provisions of paragraph (e) pertaining to inspection of the aircraft 
will be relocated to paragraph (a), since the inspection of the 
aircraft normally occurs before the overflight privilege is granted.

Section 122.25(b)--``Eligibility and Application Procedures''

    The heading of paragraph (b), currently entitled ``Procedure'', 
will be amended to read ``Eligibility and application procedures''. 
This paragraph will explain both the eligibility criteria for private 
aircraft and individuals to be routinely carried onboard the 
Overflight-approved flights, and the application procedure that only 
the aircraft owners/operators must follow who want all or certain of 
their flights considered for the Overflight Program.
    Regarding aircraft eligibility, only private aircraft arriving in 
the continental United States via certain areas south of the United 
States are eligible to participate in the Overflight Program. For 
purposes of the Overflight Program, it is important to note that the 
definition of ``private aircraft'' is broader than the general aviation 
aircraft term employed by the GATE Program. ``Private aircraft'' in the 
context of this program includes aircraft with a seating capacity of 30 
passengers. See Sec. 122.23(a).
    Regarding the identification of individuals to be carried on 
Overflight-approved flights, personal identification information of the 
pilot, members of the flight crew, and any individuals who will be the 
usual or anticipated passengers intended to be routinely onboard an 
eligible private aircraft must be provided on the application for an 
overflight privilege. On Overflight-approved flights each individual 
must agree not to carry restricted or prohibited merchandise on their 
person or in their baggage.
    As discussed above for the GATE Program, the applications for 
exemptions from the special landing requirements (overflight 
privileges) are to be filed on the new Customs Form (CF) 442, which are 
available at any Customs port. The new CF 442 will streamline the 
amount of information required of applicants. Customs will no longer 
require information concerning business activities and justification 
for the exemptions. This should speed the processing of both the 
original request and any subsequent renewals for exemptions already on 
file.
    Further as stated in the discussion on GATE, the following specific 
information is required to be submitted on the CF 442: the name of the 
aircraft owner/operator applicant; identification of the aircraft to be 
flown; identification of the airport(s) of intended landing in the 
U.S.; and the names of individuals, which include the pilot, and 
applicable flight crew and all usual or anticipated passengers, 
intended to be routinely carried onboard Overflight-approved flights. 
(Unlike the GATE Program where the approved flight is pre-cleared, the 
Overflight Program does not require information on every passenger that 
will be onboard because the approved flight will be met by Customs at 
the airport approved for the overflight.) Also, as discussed above for 
the GATE Program, the CF 442 contains a certification statement that 
must be signed and states that the applicant acknowledges having

[[Page 40654]]

read the program's requirements and agrees to abide by them and 
understands that failure to follow such requirements on Overflight-
approved flights can render participants liable for certain civil and 
criminal penalties. By signing and submitting a CF 442, an aircraft 
owner/operator acknowledges that individual passengers identified have 
been informed of the program's requirements and the penalties for 
failure to comply with these requirements, and agrees not to knowingly 
carry individuals who do not comply with the Overflight Program 
requirements, or who carry restricted or prohibited merchandise on 
their person or in their baggage on Overflight-approved flights.
    Also as discussed above for the GATE Program, individuals that are 
routinely carried on eligible private aircraft who wish to participate 
in the program do not file a CF 442; they provide their personal 
identification information to the aircraft owner/operator who includes 
the information on his CF 442. The proposed provisions regarding the 
collection of personal information from individual passengers and the 
signing of the Privacy Act waiver that must be submitted to Customs 
parallel the procedures discussed above for GATE applications.
    Applications for an overflight privilege with the individual 
passenger's Privacy Act waivers attached are to be filed with the 
Overflight Program Center--U.S. Customs Service, Sealand Building, 
Overflight Program Center, 1210 Corbin Street, Elizabeth, New Jersey 
07201. In general, applications are to be submitted to the Overflight 
Program Center at least 30 days prior to the date of the first 
scheduled flight and addenda or modifications reflecting material 
changes must be submitted at least 30 days prior to the date of the 
flight for which the changes are in effect.

Section 122.25(c)--``Notice of Action on Application; Appeal Rights''

    Since the current provisions of paragraph (c) will be covered in 
new paragraph (b), the heading of paragraph (c), currently entitled 
``Content of request'', will be amended to read ``Notice of action on 
application; appeal rights''. This paragraph will provide that, after 
consulting with the port director having jurisdiction over the airport 
designated for landing, the Overflight Program Center determines 
whether the information provided on the CF 442 meets the program's 
criteria, and notifies the aircraft owner/operator-applicant within 30 
days as to whether the application is approved or denied. Paragraph (c) 
will also delineate the specific grounds for not approving an 
application. Finally, the paragraph will reference the various 
administrative appeal procedures that private aircraft owner/operator-
applicants must follow to challenge Customs initial notice of denial 
(and any subsequent adverse determinations that may be issued). 
Individual passengers designated by applicants will have no direct 
appeal rights.
    As discussed for the GATE Program, in cases where certain of 
multiple passengers listed on the CF 442 are not approved, those not 
approved will be lined out by the Overflight Program Center and the 
overall application will be approved. In cases where either the 
aircraft, the owner/operator of the aircraft, or the pilot is not 
approved, then the Overflight Program Center will deny the application. 
Applicants denied an exemption request may either submit a new 
application to the Overflight Program Center after waiting a period of 
30 days from the date of issuance of the initial denial notice or 
appeal the notice of denial through two levels of administrative 
review. The first level of administrative review of Customs initial 
denial of an application is to the Director of Field Operations at the 
Customs Management Center responsible for supporting the particular 
port of entry. The second level of administrative review is to the 
Assistant Commissioner, Office of Field Operations. Appeals must be 
filed within 10 calendar days of the date of issuance of a denial and 
the appeal decision will be made within 30 days of the date of receipt 
of the appeal.

Section 122.25(d)--``Notice of Revocation; Appeal Procedures''

    Since the current provisions of paragraph (d) will be covered in 
new paragraph (a), the heading of paragraph (d), currently entitled 
``Procedure following exemption'', will be amended to read ``Notice of 
revocation; appeal procedures''. This paragraph will provide that 
exemption(s) can be immediately revoked by the Overflight Program 
Center, after consulting with the port director having jurisdiction 
over the airport designated for landing, for any of the specified 
reasons, which parallel the reasons given above for the GATE Program. 
When Customs decides to revoke an exemption, notice of the action will 
be in writing and advise the applicant of its appeal rights, discussed 
above under paragraph (c), which also parallel the procedures discussed 
for the GATE Program.

III. Privacy/Freedom of Information Acts Notice

    Customs files containing the information provided on the CF 442, 
the individual frequent traveler's/passenger's signed Privacy Act 
waivers authorizing Customs to advise the aircraft owner/operator 
whether the individual is approved for program participation, and 
information concerning Customs determinations of individuals' 
eligibility to participate in a private aircraft program will be 
maintained in filing cabinets and are retrievable only by aircraft tail 
number reference. For the GATE Program, the files will be located at 
the GATE Program Center in Detroit, Michigan; for the Overflight 
Program, the files will be located at the Overflight Program Center in 
Elizabeth, New Jersey. Information may also be retrieved electronically 
through TECS, again using only the aircraft tail number as a reference.

Comments

    Before adopting these proposed regulations as a final rule, 
consideration will be given to any written comments timely submitted to 
Customs, including comments on the clarity of this proposed rule and 
how it may be made easier to understand. Comments submitted will be 
available for public inspection in accordance with the Freedom of 
Information Act (5 U.S.C. 552), Sec. 1.4 of the Treasury Department 
Regulations (31 CFR 1.4), and Sec. 103.11(b) of the Customs Regulations 
(19 CFR 103.11(b)), on regular business days between the hours of 9 
a.m. and 4:30 p.m. at the Regulations Branch, Office of Regulations and 
Rulings, U.S. Customs Service, 1300 Pennsylvania Avenue--3rd Floor, NW, 
Washington, D.C.

The Regulatory Flexibility Act and Executive Order 12866

    Pursuant to provisions of the Regulatory Flexibility Act (5 U.S.C. 
601 et seq.), it is certified that, if adopted, the proposed amendments 
will not have a significant economic impact on a substantial number of 
small entities because the proposed amendments either pertain to a 
voluntary program (the GATE Program), which confers a benefit on 
private and general aviation aircraft, or streamline the information 
collection of an existing program (the Overflight Program). 
Accordingly, the proposed amendments are not subject to the regulatory 
analysis or other requirements of 5 U.S.C. 603 and 604. These proposed 
amendments do not meet the criteria for a ``significant

[[Page 40655]]

regulatory action'' as specified in Executive Order 12866.

Paperwork Reduction Act

    The collections of information contained in this notice of proposed 
rulemaking have been submitted to the Office of Management and Budget 
(OMB) for review in accordance with the Paperwork Reduction Act of 1995 
(44 U.S.C. 3507). Comments on the collections of information should be 
sent to the Office of Management and Budget, Attention: Desk Officer 
for the Department of the Treasury, Office of Information and 
Regulatory Affairs, Washington, D.C. 20503. A copy should also be sent 
to Customs at the address set forth previously.
    Comments are invited on:
    (a) Whether the collection of information is necessary for the 
proper performance of the functions of the agency, including whether 
the information shall have practical utility;
    (b) The accuracy of the agency's estimate of the information 
collection burden;
    (c) Ways to enhance the quality, utility, and clarity of the 
information to be collected;
    (d) Ways to minimize the information collection burden on 
respondents, including through the use of automated collection 
techniques or other forms of information technology; and
    (e) Estimates of capital or startup costs and costs of operations, 
maintenance, and purchase of services to provide information.
    An agency may not conduct or sponsor, and a person is not required 
to respond to, a collection of information unless the collection of 
information displays a valid control number.
    The collections of information in these proposed regulations are at 
Sec. 122.39(b)(2) (for the GATE Program) and Sec. 122.25(b) (for the 
Overflight Program).
    For the GATE Program, the information to be collected is necessary 
so that Customs can select only those frequent traveler individuals who 
present no risk to the northern border by their voluntary participation 
in the GATE Program. The likely respondents are individuals and general 
aviation aircraft owners/operators that engage in foreign commerce and 
trade along the northern border of the United States.
    Estimated total annual reporting and/or recordkeeping burden: 203 
hours.
    Estimated average annual burden per respondent/recordkeeper: 10 
minutes.
    Estimated number or respondents and/or recordkeepers: 3,497.
    Estimated annual frequency of responses: on occasion.
    For the Overflight Program, the information to be collected is 
necessary so that Customs can grant exemptions from the special landing 
requirements (overflight privileges) only to those private aircraft 
that will not be endeavoring to smuggle narcotics from countries south 
of the U.S. The likely respondents are individuals and private aircraft 
owners/operators that engage in foreign commerce and trade along the 
southern border of the United States.
    Estimated total annual reporting and/or recordkeeping burden: 15 
hours.
    Estimated average annual burden per respondent/recordkeeper: 3 
minutes.
    Estimated number or respondents and/or recordkeepers: 300.
    Estimated annual frequency of responses: on occasion.
    Part 178 of the Customs Regulations (19 CFR part 178), which lists 
the information collections contained in the regulations and control 
numbers assigned by OMB, will be amended accordingly if this proposal 
is adopted.

Drafting Information

    The principal author of this document was Gregory R. Vilders, 
Attorney, Regulations Branch, Office of Regulations and Rulings. 
However, personnel from other offices participated in its development.

List of Subjects

19 CFR Part 122

    Administrative practice and procedure, Air carriers, Aircraft, 
Airports, Air transportation, Baggage, Customs duties and inspection, 
Drug traffic control, Entry procedures, Imports, Penalties, Reporting 
and recordkeeping requirements, Security measures.

19 CFR Part 123

    Administrative practice and procedure, Aircraft, Aliens, Canada, 
Customs duties and inspection, Forms, Immigration, Imports, Mexico, 
Reporting and recordkeeping requirements.

Proposed Amendments to the Regulations

    For the reasons stated above, it is proposed to amend parts 122 and 
123 of the Customs Regulations (19 CFR parts 122 and 123) as set forth 
below:

PART 122--AIR COMMERCE REGULATIONS

    1. The authority citation for part 122 continues to read as 
follows:

    Authority:  5 U.S.C. 301; 19 U.S.C. 58b, 66, 1433, 1436, 1448, 
1459, 1590, 1594, 1623, 1624, 1644, 1644a.

    2. Section 122.22 is amended by adding at the end before the period 
the words '', unless authorized to participate in the GATE Program (see 
Sec. 122.39) or exempted from this requirement in accordance with the 
Overflight Program (see Sec. 122.25)''.
    3. In Sec. 122.24, paragraph (a) is amended by adding at the end 
before the period the words '', unless authorized to participate in the 
GATE Program (see Sec. 122.39) or exempted from this requirement in 
accordance with the Overflight Program (see Sec. 122.25)''.
    4. Section 122.25 is revised to read as follows:


Sec. 122.25  Exemption from special landing requirements.

    (a) Description of Overflight Program.--(1) In general. Any company 
or individual that has operational control over a private aircraft as 
defined under Sec. 122.23(a), that is required to give advance notice 
of arrival under the provisions of Sec. 122.23(b), and is required to 
land for Customs processing at the nearest designated airport to the 
border or coastline crossing under the provisions of Sec. 122.24 may 
request an exemption from the special landing requirements. Exemptions 
(overflight privileges), granted based on the pre-filing of certain 
personal and aircraft information, may be requested by the owners/
operators of eligible private aircraft either for a single flight or 
for all flights over a period of two years. Term exemptions may be 
renewed for two-year periods of time. Failure to follow program 
requirements on Overflight-approved flights can result in revocation of 
overflight privileges and may result in liability for certain civil and 
criminal penalties. Owners/operators participating in the Overflight 
Program also should note that, although their applications may be 
approved for a period of years, particular flights may be denied 
because of the further conditions pertaining to landing rights 
airports, found at Sec. 122.14(d).
    (2) Overflight procedures. Where an exemption has been granted, the 
aircraft commander must give Customs notice of arrival as follows:
    (i) When to report. The notice of arrival must be reported at least 
60 minutes prior to landing, unless Customs notifies the aircraft 
commander that more advance notice of arrival is necessary because the 
airport of destination is located in a remote area, see Sec. 122.31(e);
    (ii) Where to report. The notice of arrival must be reported to 
Customs at the approved airport of destination; and

[[Page 40656]]

    (iii) How to report. The notice to Customs may be furnished 
directly to Customs by telephone, radio, or other method, or indirectly 
through the Federal Aviation Administration to Customs. Where the 
notice is furnished indirectly, it is still the responsibility of the 
aircraft commander to ensure that Customs is properly notified of the 
aircraft's arrival.
    (3) Overflight conditions and responsibilities.--(i) Flight rules. 
An overflight must be conducted pursuant to an instrument flight rule 
(IFR) flight plan filed with the Federal Aviation Administration (FAA) 
or equivalent foreign aviation authority prior to commencement of the 
overflight. The crossing into the U.S. must be made within an FAA 
authorized airway.
    (ii) Flight crew and passengers. On Overflight-approved flights the 
pilot(s) and all crew members must be approved, and, if passengers are 
on board, at least one of the passengers must be approved. Further, all 
individuals must abide by the program's requirements and not carry 
restricted or prohibited merchandise on their person or in their 
baggage.
    (iii) Other requirements. The owner/operator of the private 
aircraft granted an exemption from the special landing requirements 
must:
    (A) Notify Customs of any of the following events regarding the 
aircraft or flight crew members of the aircraft either within 5 working 
days of the event or before a scheduled flight of that aircraft, 
whichever occurs earlier:
    (1) A change of Federal Aviation Administration or foreign 
registration number for the aircraft;
    (2) The sale, theft, modification or destruction of the aircraft; 
or
    (3) Changes of pilots or crewmembers. Every pilot and crewmember 
participating in an overflight must have prior Customs approval either 
through the initial application or a supplemental application before 
commencement of the aircraft's first overflight with that pilot or crew 
member;
    (B) Request permission from Customs to fly to any airport that is 
not listed in the initial exemption application; and
    (C) Retain on board the aircraft copies of the initial application 
for an exemption, all applicable supplemental applications filed, and 
all requests for additional landing privileges, as well as a copy of 
the letter from Customs approving each of these requests.
    (b) Eligibility and application procedures.--(1) Eligibility. 
Private aircraft that arrive in the continental U.S. from areas south 
of the U.S. may seek an exemption from the special landing requirements 
of Sec. 122.24 (overflight privileges), for either a single flight or 
for a number of flights over a period of two year. Private aircraft 
that carry restricted or prohibited merchandise are not eligible for 
this program. For Overflight Program purposes, the term ``private 
aircraft'' is defined at Sec. 122.23(a).
    (2) Application procedure.--(i) Who applies for the overflight 
privilege. Owners/operators of eligible private aircraft (see paragraph 
(b)(1) of this section) who want all or certain of their flights 
considered for participation in the Overflight Program should contact 
the following Customs office to request an application for exemption 
from the special landing requirements of Sec. 122.24: U.S. Customs 
Service, Sealand Building, Overflight Program Center, 1210 Corbin 
Street, Elizabeth, New Jersey 07201. Customs Form (CF) 442 (Application 
for Exemption from Special Landing Requirements (Overflight) or General 
Aviation Telephonic Entry Program (GATE)) is the application form. The 
owner/operator applying for an exemption will provide on the 
application the personal identification information of pilot(s), 
members of the flight crew, and any individuals who will be the usual 
or anticipated passengers intended to be routinely carried onboard an 
Overflight-approved flight. Individual passengers who provide their 
personal information for inclusion on an aircraft owner's/ operator's 
CF 442 must sign a Privacy Act waiver provided to them by the aircraft 
owner/operator that authorizes Customs to perform whatever checks are 
necessary to determine their eligibility for participation in the 
program and to advise the aircraft owner/operator as to whether the 
individual is approved. Customs will verify information through the 
Treasury Enforcement Communications System (TECS). The waiver is to be 
submitted to the aircraft owner/operator who will forward all the 
individual Privacy Act waivers with his CF 442 to Customs. By signing 
and submitting a CF 442, a private aircraft owner/operator acknowledges 
that the individuals identified on the form have been informed of the 
program's requirements to not carry restricted or prohibited 
merchandise on their person or in their baggage and of the penalties 
for failure to comply with these requirements, and agrees that he will 
not knowingly carry individuals who do not comply with the program's 
requirements on Overflight-approved flights.
    (ii) When to apply. Generally, applications, with the individual 
Privacy Act waivers attached, must be submitted to the Overflight 
Program Center at least 30 days prior to the date of the first 
scheduled flight and addenda or modifications reflecting material 
changes must be submitted at least 30 days prior to the date of the 
flight for which the changes are in effect. However, in cases involving 
air ambulance operations when emergency situations arise or where other 
flights of private aircraft entail the non-emergency transport of 
persons seeking medical treatment in the U.S., Customs may accept 
exemption requests when the aircraft is in flight through a Federal 
Aviation Administration Flight Service Station.
    (3) Aircraft inspection requirement. Applicants for the Overflight 
Program must agree to make the subject aircraft available for Customs 
inspection to determine if the aircraft is capable of meeting Customs 
requirements for the proper conduct of an overflight privilege. 
Inspections may be conducted during the review of an initial 
application or at any time during the term of an exemption.
    (c) Notice of action on application; appeal rights. Applications 
will be evaluated based on the information provided on the CF 442 as 
verified by Customs. Following an evaluation of the information 
submitted and after consulting with the port director having 
jurisdiction over the airport designated for landing, the Overflight 
Program Center will notify the applicant within 30 days whether the 
application is approved or denied. In cases where the application is 
denied, notice will be in writing and state the reason(s) for denial, 
advise the applicant of its administrative appeal rights under 
paragraph (c)(2) of this section and of the alternate recourse of 
submitting a new application after waiting a period of 30 days, and 
recite the appeal procedures under paragraph (d)(3) of this section.
    (1) Grounds for denial. The Overflight Program Center may deny an 
application for any of the following reasons:
    (i) Failure of the applicant to meet the eligibility criteria, 
specified at paragraph (b)(1) of this section;
    (ii) Evidence that the application contains false or misleading 
information concerning a material fact;
    (iii) Evidence of criminal or dishonest conduct regarding the 
owner/operator of the aircraft or the designated pilot; or
    (iv) A determination is made that the grant of an overflight 
privilege would endanger the revenue or otherwise invite circumvention 
of laws enforced by Customs.
    (2) Appeal rights. Applicants denied overflight privileges have 
appeal rights,

[[Page 40657]]

and, upon receiving notice of the denial, may either:
    (i) Submit a new application to the Overflight Program Center after 
waiting a period of 30 days from the date of issuance of the initial 
denial notice; or
    (ii) Appeal the notice of denial in accordance with the 
administrative appeal procedures set forth in paragraph (d)(3) of this 
section.
    (d) Notice of revocation; appeal procedures.--(1) Revocation. The 
Overflight Program Center may immediately revoke an exemption for any 
of the following reasons:
    (i) The application contained false or misleading information 
concerning a material fact;
    (ii) An approved individual or the owner/operator of the aircraft 
is subsequently indicted for, convicted of, or has committed acts which 
would constitute any felony or misdemeanor under United States Federal 
or State law. In the absence of an indictment, conviction, or other 
legal process, Customs must have probable cause to believe proscribed 
acts occurred;
    (iii) Any individual carried on an Overflight-approved flight 
refuses or otherwise fails to follow any proper order of a Customs 
officer or any Customs order, rule, or regulation;
    (iv) Reasonable grounds exist to believe that Federal rules and 
regulations pertaining to public health or safety, Customs, or other 
inspectional activities have not been followed;
    (v) Any individual carried on an Overflight-approved flight fails 
to adhere to the conditions or restrictions imposed by the Overflight 
Program; or
    (vi) Continuation of the overflight privilege would endanger the 
revenue or otherwise invite circumvention of laws enforced by Customs.
    (2) Notice. When a decision to revoke an exemption or to deny an 
applicant overflight privileges is made, the Overflight Program Center, 
after consulting with the port director having jurisdiction over the 
airport designated for landing, will notify the participant or 
applicant of the decision in writing. The notice of revocation or 
notice of denial and any subsequent notices of adverse determination 
will state the reason(s) for the adverse action, advise the participant 
or applicant of its administrative appeal rights and of the alternate 
recourse of submitting a new application after waiting a period of 30 
days from the date of issuance of the initial notice of revocation or 
notice of denial, or any subsequent adverse determination, and recite 
the appeal procedures under paragraph (d)(3) of this section.
    (3) Appeal procedures. An Overflight Program participant who 
receives notice of revocation or an applicant for overflight privileges 
who receives notice of denial may administratively appeal the initial 
notice of adverse action in writing within 10 calendar days of the date 
of issuance of the notice to the next level of administrative review. 
Appeals must be filed in duplicate and must set forth the appellant's 
responses to the grounds specified in the notice of adverse action or 
the subsequent notice of adverse determination issued by the Overflight 
Program Center.
    (i) The Director of Field Operations. The first appeal is to the 
Director of Field Operations at the appropriate Customs Management 
Center, which will be specified by the Overflight Program Center in its 
notice of adverse action. Within 30 days of receipt of the appeal, the 
Director of Field Operations, or his designee, will make a 
determination regarding the appeal and notify the appellant of the 
decision in writing. If the determination is adverse to the appellant, 
the notice of adverse determination will contain the information 
specified at paragraph (d)(2) of this section. If the appellant wants 
to appeal the Director of Field Operation's adverse determination to 
the Assistant Commissioner, then the appellant must file the second 
appeal within 10 calendar days of the date of issuance of the Director 
of Field Operation's adverse determination.
    (ii) The Assistant Commissioner. The second appeal is to the 
Assistant Commissioner, Office of Field Operations, U.S. Customs 
Service, 1300 Pennsylvania Avenue, Washington, D.C. 20229. Within 30 
days of receipt of the appeal, the Assistant Commissioner, or his 
designee, will make a determination regarding the appeal and notify the 
appellant of the decision in writing. If the determination is adverse 
to the appellant, the notice of adverse determination will state the 
reason(s) for the adverse action.
    5. In Sec. 122.26, the second sentence is amended at the end before 
the period by adding the words '', unless they are participating in and 
in compliance with the GATE Program (see Sec. 122.39)''.
    6. In Sec. 122.31:
    (a) paragraph (a) is amended in the second sentence at the end 
before the period by adding the words ``or, if applicable, 
Sec. 122.25''; and
    (b) paragraph (c)(1) is amended in the second sentence by adding 
after the words ``place of first landing'' the words ``or, in cases of 
GATE-approved flights (see Sec. 122.39), to the GATE Program Center as 
required''.
    7. Section 122.36 is revised to read as follows:


Sec. 122.36  Responsibility of aircraft commander.

    Generally, if Customs officers are not present when an aircraft 
lands in the U.S., the aircraft commander must hold the aircraft and 
all merchandise and baggage on the aircraft for inspection. Passengers 
and crewmembers must be kept in a separate place until they are 
authorized by Customs officers to depart. If the aircraft is 
participating in the GATE Program (see Sec. 122.39), the participants 
onboard GATE-authorized flights may depart the landed aircraft with 
their personal effects, which must not include merchandise that 
requires the payment of Customs duties or merchandise that is 
restricted or prohibited, or monetary instruments in excess of $10,000; 
however, if the flight is ahead of schedule, they must remain on the 
aircraft until the time that was reported to be their estimated time of 
arrival.
    8. A new Sec. 122.39 is added in subprt D to read as follows:


Sec. 122.39  The General Aviation Telephonic Entry (GATE) Program.

    (a) Description of program.--(1) In general. The General Aviation 
Telephonic Entry (GATE) Program is a program designed to facilitate the 
processing of certain pre-qualified frequent travelers on pre-
registered general aviation aircraft arriving in the United States 
directly from Canada. Participation in the GATE Program is voluntary 
and requires participants to comply with the program's requirements, 
which include the pre-filing of certain personal information and 
arriving in the U.S. only at designated locations. In exchange for this 
cooperation, participants are exempted from the general Customs 
requirements for entry into the United States, contained at Sec. 123.1 
of this chapter. Because GATE flights are pre-cleared telephonically, 
GATE-approved flights may carry only individuals that are approved to 
participate in the GATE Program. Participants should be aware that 
failure to follow program requirements on GATE-approved flights can 
result in revocation of their participation in the program and may 
result in liability for certain civil and criminal penalties. Owners/
operators participating in the GATE Program also should note that, 
although their applications may be approved for a period of years, 
particular flights may be denied GATE privileges because of the further 
conditions pertaining to landing rights airports, found at 
Sec. 122.14(d).

[[Page 40658]]

    (2) GATE procedures. The pilot of the GATE-approved flight provides 
Customs with the required advance notice of the flight's arrival. 
Customs then assigns the GATE-approved flight an advance arrival number 
which gives permission for the flight to land at a GATE-designated 
airport. Upon landing in the U.S., the participants onboard may depart 
the landed aircraft with their personal effects, which must not include 
merchandise that requires the payment of Customs duties or merchandise 
that is restricted or prohibited, or monetary instruments in excess of 
$10,000. However, if the flight is ahead of schedule, then all 
individuals must remain onboard the aircraft until the time that was 
reported to be their estimated time of arrival.
    (b) Eligibility and application procedures.--(1) Eligibility.--(i) 
Aircraft. U.S.- and Canadian-registered general aviation aircraft that 
arrive in the United States directly from Canada are eligible to 
participate in the GATE Program. Aircraft transiting Canada are not 
eligible to participate in the GATE Program. Further, aircraft that 
will carry cargo or merchandise requiring the payment of Customs duties 
or merchandise that is restricted or prohibited, or monetary 
instruments in excess of $10,000 are not eligible for this program. For 
GATE Program purposes, the term ``general aviation aircraft'' means 
private aircraft, and certain commercial aircraft, consisting of small 
charter/air taxi aircraft and air ambulances that have a seating 
capacity for fifteen or fewer individuals, when such aircraft are not 
in commercial service. Aircraft accepted into the GATE Program maintain 
their eligibility status so long as they make at least one flight per 
year.
    (ii) Airports. Airports already designated for GATE flights and 
other airports not previously considered may be requested on an 
application. In these later cases, the local port director will 
determine whether the airport specified is suitable to receive GATE 
flights by reviewing the facilities at the airport.
    (iii) Individuals. The pilot(s), members of the flight crew, and 
corporate employees/officers who frequently travel on general aviation 
aircraft are individuals eligible to be carried on GATE-approved 
flights. Each individual must meet the following additional criteria:
    (A) Citizenship. Each individual must be a:
    (1) U.S. citizen;
    (2) Permanent resident of the U.S.;
    (3) Canadian citizen; or
    (4) Landed immigrant in Canada from a Commonwealth country;
    (B) Admissibility into the U.S. Each individual must demonstrate 
his right to be legally admitted into the United States by passing a 
``face-to-face'' inspection with either a U.S. Immigration or Customs 
officer; and
    (C) Compliance with program requirements. On GATE-approved flights, 
each individual must agree to carry all required personal 
identification and immigration documents and not to carry merchandise 
that requires the payment of Customs duties or merchandise that is 
restricted or prohibited, or monetary instruments in excess of $10,000.
    (2) Application procedure.--(i) Who applies for GATE entry 
privileges. Owners/operators of eligible general aviation aircraft (see 
paragraph (b)(1)(i) of this section) who want all or certain of their 
flights considered for participation in the GATE Program should contact 
the following Customs office to request an application for GATE: U.S. 
Customs Service, Detroit Metropolitan Airport, GATE Program Center, 
International Terminal, Detroit, Michigan 48242. Customs Form (CF) 442 
(Application for Exemption from Special Landing Requirements 
(Overflight) or General Aviation Telephonic Entry Program (GATE)) is 
the application form. The owner/operator applying for the GATE Program 
will provide on the application the personal identification information 
of individual frequent travelers who will be carried onboard a GATE-
approved flight. Individual frequent travelers who provide their 
personal information for inclusion on an aircraft owner's/operator's CF 
442 must sign a Privacy Act waiver provided to them by the aircraft 
owner/operator that authorizes Customs to perform whatever checks are 
necessary to determine their eligibility for participation in the 
program and to advise the aircraft owner/operator as to whether the 
individual is approved. Customs will verify information through the 
Treasury Enforcement Communications System (TECS). The waiver is to be 
submitted to the aircraft owner/operator who will forward all the 
individual Privacy Act waivers with his CF 442 to Customs. By signing 
and submitting a CF 442, a general aviation aircraft owner/operator 
acknowledges that individual frequent travelers identified on the form 
have been informed of the program's requirements to not carry 
merchandise that requires the payment of Customs duties or merchandise 
that is restricted or prohibited, or monetary instruments in excess of 
$10,000 and of the penalties for failure to comply with these 
requirements. Further, the applicant agrees that he will not allow his 
participating aircraft to carry individuals who are not listed on their 
application and approved by Customs and that he will not allow any 
individuals to carry merchandise or monetary instruments that violate 
the program's requirements on GATE-approved flights.
    (ii) When to apply. Generally, applications, with the individual 
Privacy Act waivers attached, must be submitted to the GATE Program 
Center at least 30 days prior to the date of the first scheduled flight 
and addenda or modifications reflecting material changes must be 
submitted at least 30 days prior to the date of the flight for which 
the changes are in effect.
    (c) Notice of action on application; appeal rights. Applications 
will be evaluated based on the information provided on the CF 442 as 
verified by Customs. Following an evaluation of the information 
submitted, the GATE Program Center will notify the applicant within 30 
days whether the application is approved or denied. In cases where the 
application is denied, notice will be in writing and state the 
reason(s) for denial, advise the applicant of its administrative appeal 
rights under paragraph (c)(2) of this section and of the alternate 
recourse of submitting a new application after waiting a period of 30 
days, and recite the appeal procedures under paragraph (d)(3) of this 
section.
    (1) Grounds for denial. The GATE Program Center may deny an 
application for any of the following reasons:
    (i) Failure of the applicant to meet the eligibility criteria, 
specified at paragraph (b)(1) of this section;
    (ii) Evidence that the application contains false or misleading 
information concerning a material fact;
    (iii) Evidence of criminal or dishonest conduct regarding the 
owner/operator of the aircraft or the designated pilot; or
    (iv) A determination is made that the grant of GATE privileges 
would endanger the revenue or otherwise invite circumvention of laws 
enforced by Customs.
    (2) Appeal rights. Applicants denied participation in the GATE 
Program have appeal rights, and, upon receiving notice of the denial, 
may either:
    (i) Submit a new application to the GATE port director after 
waiting a period of 30 days from the date of issuance of the initial 
notice of denial; or
    (ii) Appeal the notice of denial in accordance with the 
administrative appeal procedures set forth in paragraph (d)(3) of this 
section.

[[Page 40659]]

    (d) Notice of revocation; appeal procedures.--(1) Revocation. The 
GATE Program Center may immediately revoke an aircraft's participation 
in the GATE Program for any of the following reasons:
    (i) The application contained false or misleading information 
concerning a material fact;
    (ii) A participating individual or the owner/operator of the 
aircraft is subsequently indicted for, convicted of, or has committed 
acts which would constitute any felony or misdemeanor under United 
States Federal or State law. In the absence of an indictment, 
conviction, or other legal process, Customs must have probable cause to 
believe proscribed acts occurred;
    (iii) A participating individual allows an unauthorized individual 
to use his GATE certificate or other approved form of identification;
    (iv) A participating individual refuses or otherwise fails to 
follow any proper order of a Customs officer or any Customs order, 
rule, or regulation;
    (v) Reasonable grounds exist to believe that Federal rules and 
regulations pertaining to public health or safety, Customs, or other 
inspectional activities have not been followed;
    (vi) A participating individual fails to adhere to the conditions 
or restrictions imposed by the GATE Program; or
    (vii) Continuation of GATE privileges would endanger the revenue or 
otherwise invite circumvention of laws enforced by Customs.
    (2) Notice. When a decision to revoke participation in the GATE 
Program or deny an applicant GATE privileges is made, the GATE Program 
Center will notify the participant or applicant of the decision in 
writing. The notice of revocation or notice of denial and any 
subsequent notices of adverse determination will state the reason(s) 
for the adverse action, advise the participant or applicant of its 
administrative appeal rights and of the alternate recourse of 
submitting a new application after waiting a period of 30 days from the 
date of issuance of the initial notice of revocation or notice of 
denial or any subsequent adverse determination, and recite the appeal 
procedures under paragraph (d)(3) of this section.
    (3) Appeal procedures. A GATE Program participant who receives 
notice of revocation or an applicant for GATE privileges who receives 
notice of denial may administratively appeal the initial notice of 
adverse action in writing within 10 calendar days of the date of 
issuance of the notice to the next level of administrative review. 
Appeals must be filed in duplicate and must set forth the appellant's 
responses to the grounds specified in the notice of adverse action or 
the subsequent notice of adverse determination issued by the Detroit 
Port Director.
    (i) The Detroit Port Director. The first appeal is to the Detroit 
Port Director, U.S. Customs Service, Detroit Metropolitan Airport, GATE 
Program Center, International Terminal, Detroit, Michigan 48242. Within 
30 days of receipt of the appeal, the Detroit Port Director, or his 
designee, will make a determination regarding the appeal and notify the 
appellant of the decision in writing. If the determination is adverse 
to the appellant, the notice of adverse determination will contain the 
information specified at paragraph (c)(2) of this section. If the 
appellant wants to appeal the Detroit Port Director's adverse 
determination, then the appellant must file the second appeal within 10 
calendar days of the date of issuance of the Detroit Port Director's 
adverse determination.
    (ii) The Assistant Commissioner. The second appeal is to the 
Assistant Commissioner, Office of Field Operations, U.S. Customs 
Service, 1300 Pennsylvania Avenue, Washington, D.C. 20229. Within 30 
days of receipt of the appeal, the Assistant Commissioner, or his 
designee, will make a determination regarding the appeal and notify the 
appellant of the decision in writing. If the determination is adverse 
to the appellant, the notice of adverse determination will state the 
reason(s) for the adverse action.

PART 123--CUSTOMS RELATIONS WITH CANADA AND MEXICO

    1. The authority citation for part 123 continues to read in part as 
follows:

    Authority: 19 U.S.C. 66, 1202 (General Note 20, Harmonized 
Tariff Schedule of the United States (HTSUS)), 1431, 1433, 1436, 
1448, 1624. Section 123.1 also issued under 19 U.S.C. 1459;
* * * * *
    2. In Sec. 123.1, paragraph (a)(2) is amended at the end before the 
period by adding the words ``except in the case of a GATE-approved 
flight''.

Raymond W. Kelly,
Commissioner of Customs.
    Approved: July 30, 2001.
Timothy E. Skud,
Acting Deputy Assistant Secretary of the Treasury.
[FR Doc. 01-19337 Filed 8-2-01; 8:45 am]
BILLING CODE 4820-02-P