[Federal Register Volume 67, Number 138 (Thursday, July 18, 2002)]
[Proposed Rules]
[Pages 47338-47341]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-18042]


 ========================================================================
 Proposed Rules
                                                 Federal Register
 ________________________________________________________________________
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 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
 
 ========================================================================
 

  Federal Register / Vol. 67, No. 138 / Thursday, July 18, 2002 / 
Proposed Rules  

[[Page 47338]]



DEPARTMENT OF COMMERCE

International Trade Administration

19 CFR Chapter III

[020711168-2168-01]
RIN: 0625-AA60


Steel Import Licensing and Surge Monitoring

AGENCY: Import Administration, International Trade Administration, 
Commerce.

ACTION: Proposed rule and request for public comment.

-----------------------------------------------------------------------

SUMMARY: The Department of Commerce is issuing, and requesting public 
comment on, a proposed rule to establish a steel licensing and surge 
monitoring system as instructed by the President in his announcement of 
safeguard remedies on certain steel products.

DATES: Written comments must be received on or before 5 p.m. Eastern 
daylight savings time on August 19, 2002. Please keep written comments 
to five pages or less.

ADDRESSES: Written comments should be sent to Roland L. MacDonald, 
Director of Policy and Analysis, Import Administration, Room 3713, 
Department of Commerce, 14th and Constitution Ave., NW., Washington, DC 
20230.

FOR FURTHER INFORMATION CONTACT: Kelly Parkhill (202) 482-3791; Julie 
Al-Saadawi (202) 482-1930; or Laura Merchant (202) 482-0367.

SUPPLEMENTARY INFORMATION: On March 5, 2002, President Bush announced 
the imposition of safeguard measures on certain steel products pursuant 
to Section 203 of the Trade Act of 1974 (see 67 FR 10593; a copy of the 
President's proclamation is available on the White House website: 
http://www.whitehouse.gov/news/releases/2002/03/20020305-7.html). These 
measures, in the form of tariffs ranging from 8 to 30 percent on a 
number of steel products and a tariff-rate quota on slabs, were the 
result of a section 201 investigation requested by the President and 
initiated by the International Trade Commission (ITC) in June 2001. The 
effective date of the safeguard measures was March 20, 2002.
    A number of countries were exempted from the safeguard measures 
because of international commitments under bilateral free trade 
agreements, NAFTA and the WTO. However, in granting these exemptions, 
the President made clear that the exclusionary status would be revoked 
for developing countries, in full or part, if a surge in imports from 
that exempted country were to undermine the effectiveness of the 
safeguard measure. The President also stated that the United States 
Trade Representative (USTR):

is authorized to determine whether a surge in imports of a product 
that is the product of a country listed in subdivision (d)(i) 
undermines the effectiveness of the pertinent safeguard measure and, 
if so, upon publication of a notice in the Federal Register, to 
revise subdivision (d) of Note 11 in the Annex to this proclamation 
to indicate that such product from such country is not excluded from 
such safeguard measure.

    The President instructed USTR to review import data on a quarterly 
basis for signs of material increases in imports, which would then be 
the basis for immediate consultations and possible inclusion in the 
safeguard measure. To assist this effort, the President instructed the 
Secretary of the Treasury and the Secretary of Commerce to:

establish a system of import licensing to facilitate the monitoring 
of imports of certain steel products. * * * [and] the Secretary of 
Commerce, within 120 days of the effective date of the safeguard 
measures established by the Proclamation, to publish regulations in 
the Federal Register establishing such a system of import licensing.

    The Secretary of Commerce has delegated the responsibility for 
issuing these regulations to the Import Administration. In fulfillment 
of the President's instructions, the International Trade Administration 
is today publishing this proposed rule and request for comment to 
establish an internet-based steel licensing and surge monitoring 
system. The system will be comprised of three parts:


    (1) An online registration system for steel importers;
    (2) An automatic steel license issuance system; and
    (3) An import surge monitoring website.

    Although portions of these systems will be linked, for security 
purposes and the protection of proprietary information collected, the 
three systems will operate separately on a stand-alone basis. There 
will be an alternative backup method in place at Commerce, such as a 
telephone or fax system, should there be a malfunction of the internet-
based system.
    All imports of steel products listed in the President's section 201 
relief determination, including those products subject to country 
exemptions or product exclusions will be required to obtain a steel 
import license and provide the license number to U.S. Customs on the 
entry summary. The only exceptions are the low-valued imports described 
below under ``informal entries''. Information gathered from these 
licenses will be used to ensure that the purpose of the 201 relief is 
not undermined. An interagency group will assist USTR with analysis 
required of the data collected beyond the data posted for the surge 
monitor.
    Steel Import Licensing System. The steel import licensing system 
includes both the online registration system for importers and the 
automatic steel import license issuance system. In order to obtain a 
steel import license, an importer or the importer's agent or customs 
broker, must first register with the Department of Commerce (Commerce) 
and be assigned a user identification number. This identification 
number will be required to log on to the steel import license issuance 
system. A single user identification number will be issued to an 
importing company or brokerage house. Operating units within the 
company (e.g., individual branches, divisions or employees) will all 
use the same company user identification code. The steel import license 
issuance system will be designed to allow multiple users of a single 
identification number from different locations within the company to 
enter information simultaneously.
    Any company or broker with a United States address may register and 
obtain a user identification number. There is no fee to register and a 
user identification number will be issued within two (2) business days. 
As part of the registration

[[Page 47339]]

process, the importer, agent or customs broker will be required to 
provide certain general information. Such information will include the 
applicant company name, Employer Identification Number (EIN) or the 
Customs ID number (where no EIN is available), address, phone number, 
contact information and email address for both the company headquarters 
and any branch offices that will be applying for steel licenses. This 
information will be used solely for the purposes of administering the 
steel import licensing and surge monitoring programs. The information 
will not be released by Commerce, except as required by U.S. law. 
Commerce will begin registering and issuing user identification numbers 
at least two weeks prior to the implementation date of the steel 
licensing program. Should a company prefer to apply for an ID non-
electronically, a fax/phone option will be available at Commerce during 
regular business hours. The user ID will be needed to apply for the 
license. One option for the user ID may be the Employer Identification 
Number or Customs ID number (where there is no EIN).
    Steel import licenses will be issued to registered importers, 
customs brokers or their agents through an automatic steel import 
licensing system. The separately issued user identification number 
discussed above will be required to access the system. There will be no 
fee charged to apply for the import licenses.
    Steel import licenses will be issued automatically after the 
completion of the application form. In order to obtain the license, the 
applicant must report the following information about the steel import 
transaction:
    (1) Applicant company name and address;
    (2) Applicant contact name, phone number, fax number and email 
address;
    (3) Importer name;
    (4) Exporter name;
    (5) Manufacturer name;
    (6) Country of origin;
    (7) Country of exportation;
    (8) Expected date of export;
    (9) Expected date of import;
    (10) Expected port of entry;
    (11) Customs entry number;
    (12) Current HTS number (from Chapters 72, 73, or 99);
    (13) Original HTS number in Chapter 72 or 73 (if HTS number in 12 
above is a Chapter 99 product);
    (14) Quantity (in kilograms); and
    (15) Customs value (U.S. $).
    Much of the information requested on the application form will be 
filled out automatically based on information provided in the 
registration process (e.g., applicant company name and address) or will 
be self-generated from other information reported in the form (e.g., 
product description, section 201 remedy category or average unit 
value). Other information will be available from flip down lists in the 
application form (e.g., HTS numbers covered by the section 201 remedy, 
country of origin, port of entry) and will not have to be typed. A 
sample copy of the steel import license is available for viewing on 
Import Administration's website (http://ia.ita.doc/steel/license/). As 
currently proposed, a Customs entry number must be reported in order to 
obtain a license. Parties are encouraged to comment on whether the 
Customs entry number should remain a required field or if it should 
only be required if available at the time of filing. Parties are also 
encouraged to comment whether applicants should be allowed to enter 
``unknown'' in the fields for exporter and manufacturer name.
    Upon completion of the application form, the importer, customs 
broker or the importer's agent will certify as to the accuracy and 
completeness of the information and submit the form electronically. 
After refreshing the page, the system will automatically issue a steel 
import license number. The refreshed form containing the submitted 
information and the newly issued license number will appear on the 
screen (the ``license form''). Applicants can print the license form 
themselves only at that time. For security purposes, users will not be 
able to retrieve licenses themselves from the license system at a later 
date for reprinting. If needed, copies of completed license forms can 
be requested from Commerce during normal business hours.
    The steel import license will be required on every entry of covered 
steel products (except informal entries covered below). As currently 
envisioned, a single license could cover multiple products as long as 
the importer, exporter, manufacturer, and country of origin and 
exportation are the same. However, separate licenses would be required 
if any of the above information differed with respect to a given set of 
covered imported steel products. As a result, a single Customs entry 
may require more than one steel import license. The applicable license 
number(s) must cover the total quantity of steel entered and should 
match the information provided on the Customs entry summary. There is 
no requirement to present physical copies of the license forms at the 
time of entry summary; however, copies must be maintained in accordance 
with Customs' normal requirements.
    Commerce is examining two alternative licensing procedures: a 
single license per entry and a multiple entry license. Under the 
multiple entry option, the license could be obtained for the quantity 
of goods to be imported over an extended period (up to 30 days) and the 
same license number would be reported until the quantity is exhausted 
or the license has expired. Parties interested in such alternative 
licensing procedures should submit comments on the requirements of such 
licenses and the ways in which the necessary accuracy of such 
information can be ensured.
    Certain aggregate information collected from the license 
application system will be posted on the steel import surge monitoring 
website. Subject to comment received, only the aggregate information 
described below will be available to the public. All other information 
including copies of the licenses and the names of importers, exporters, 
and manufacturers, will be considered business proprietary information 
and will not be released to the public. Its use will be strictly 
limited to the administration of the section 201 remedies imposed by 
the President and it will not be kept longer than the period of time 
legally required beyond the expiration of these remedies.
    In addition to the sample steel import license, prototype versions 
of the online registration system and the automatic steel import 
license issuance system are available for test use on Import 
Administration's website (http://ia.ita.doc.gov/steel/license/). 
Interested parties are encouraged to test the system and comment on any 
concerns about the system or provide suggested improvements.
    Steel Import Surge Monitoring System. Commerce will create a stand-
alone steel import surge monitoring website. This website will report 
certain aggregate information on imports of section 201 product 
categories obtained from the steel licenses. Aggregate information will 
be reported on a monthly basis by country of origin and section 201 
product category and will include import quantity (metric tons), import 
Customs value (U.S. dollars) and average unit value (dollars per metric 
ton). Reported monthly import data will be refreshed each week with new 
data on licenses issued in the prior week. This data collected may be 
adjusted periodically for canceled or unused steel import licenses, if 
deemed appropriate for accurate monitoring purposes. Parties are 
encouraged to comment whether additional aggregate data should be 
reported (e.g., port of entry data) and any disclosure concerns

[[Page 47340]]

they may have over the currently proposed system (e.g., as currently 
proposed Commerce will not adjust, range or redact any aggregate 
information reported by the monitoring system)
    The monitoring system will also present a range of historical data 
for comparison purposes. This will include comparisons to the previous 
month and to the same month in the previous year, three month rolling 
averages along with similar comparisons to the immediately preceding 
period, the same period from the preceding year, and monthly import 
data on each complete section 201 product category. A sample version of 
the steel import surge website is available for viewing on Import 
Administration's website (http://ia.ita.doc.gov/steel/license/).
    At present, Commerce is still considering whether similar aggregate 
data on excluded products will be reported on the monitoring system 
website given the more specific nature of these products. As currently 
envisioned, such information would only be available for review by the 
appropriate government agencies. However, we encourage parties to 
comment on whether some sort of aggregate data on these products could 
or should be reported on the monitoring website (e.g., quantity by 
country of origin and remedy product category).
    Duration of the Steel Import License. The steel import license can 
be applied for up to 30 days prior to the expected date of importation 
and until the date of filing of the entry summary documents. The steel 
import license is valid for up to 45 days; however, import licenses 
that were valid on the date of importation but expired prior to the 
filing of entry summary documents will be accepted. Special timing 
issues surrounding withdrawal of products from a warehouse, FTZ issues, 
and temporary imports will be handled separately.
    Handling of Steel to Foreign Trade Zones. Commerce proposes to 
require a license for steel shipped into a U.S. FTZ. Because a Custom 
entry number would not be available for shipments entering the FTZ, an 
alternate code would be entered in the Customs entry number field on 
the license application. Upon withdrawal from the FTZ as an import into 
the U.S., another license would be required filed in the standard 
fashion with a Customs entry number identifier.
    U.S. Customs Requirements. U.S. Customs intends to publish a 
separate Notice of Proposed Rulemaking (NPRM), setting requirements for 
the timely filing of the steel import license information at entry 
summary. Customs intends to propose that an entry summary not completed 
in the allowed filing period will be subject to liquidated damages for 
violation of the bond condition requiring timely completion of entry. 
In accordance with 19 USC 1623(c), Customs will publish guidelines 
establishing standards for setting the terms and conditions for 
mitigation of these claims.
    Hours of Operation. As currently proposed, parties will be able to 
access the system 24 hours a day, 7 days a week. If the system is down 
for an extended period of time, parties will be able to obtain licenses 
from Commerce via fax during regular business hours. Should the system 
be inaccessible for an extended period of time, Customs may consider 
this as part of mitigation.
    Informal Entries. No import license shall be required on informal 
entries of steel products, such as merchandise valued at less than 
$2,000. For additional information, refer to 19 CFR 143.21-28.
    Interim Monitoring. Census added a special section 201 monitoring 
report to its monthly early release of steel import data. This special 
section includes two summary reports that provide preliminary section 
201 import figures for each of the section 201 product categories as 
well as figures for each of the top 20 excluded countries. Full reports 
covering imports of steel products subject to section 201 remedies are 
also made available by Census. These two full reports, one sorted by 
country of origin, the other, by section 201 product category provide 
aggregate import information by product category for all countries 
starting with the early release of April import data on May 29, 2002. 
All information is posted on Census' website (http://www.census.gov/
foreign-trade/Press-Release/steel--index.html).
    The new early release import data reported by Census provides the 
Administration and the public with an interim means of monitoring 
potential import surges from excluded countries until the steel 
licensing and surge monitoring system is operational. Once the new 
steel licensing and surge monitoring program is in place, the early 
release data reported by Census will then act as a check on the 
accuracy of the data collected under the steel licensing program.
    Duration. The licensing program will be in effect for the duration 
of the safeguard measures only. The licenses, however, will be valid 
for 10 business days after the expiration of the safeguard measures to 
allow for the final filing of required Customs documentation.

Classification

    Regulatory Flexibility Act. The Chief Counsel for Regulation 
certified to the Chief Counsel for Advocacy of the Small Business 
Administration that this proposed rule, if adopted, will not have a 
significant impact on a substantial number of small entities as that 
term is defined in the Regulatory Flexibility Act, 5 U.S.C. 601 et seq. 
A summary of the factual basis for this certification is below.
    This proposed rule will not have a significant impact on a 
substantial number of companies. In most cases, brokerage companies 
will apply for the license for the steel importers. Most brokerage 
companies that are currently involved in filing documentation for 
importing goods into the U.S., are accustomed to Customs' automated 
systems. Today, more than 99% of the Customs filings are handled 
electronically. Therefore, the web-based nature of this simple license 
application should not be a significant obstacle to any firm in 
completing this new requirement. However, should a company need to 
apply for an ID or license non-electronically, a fax/phone option will 
be available at Commerce during regular business hours. There is no 
cost to register for a company-specific ID user code and no cost to 
file for the license. Each license form is expected to take about 10 
minutes to complete using much of the same information used to complete 
the Customs Entry Summary documentation. This is the one additional 
requirement of the importers' broker to fulfill U.S. entry requirements 
to import each covered steel product shipment. Commerce estimates that 
approximately 400 brokerage companies and importers will apply for 
steel import licenses annually. Of this number, Commerce estimates that 
fewer than 5% of brokerage companies would be considered small 
entities. Commerce estimates about 1%, or $33,333.00, represents the 
amount that small entities will incur as a result of this proposed 
rule.
    Paperwork Reduction Act. This proposed rule contains collection-of-
information requirements subject to review and approval by OMB under 
the Paperwork Reduction Act (PRA). These requirements will be submitted 
to OMB for approval. Public reporting burden for these collections of 
information is estimated at 10 minutes. The licensing system requests 
information already required of an importer, approval is automatic, and 
the importer will have

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ample opportunity and time to apply. These estimates include the time 
for reviewing instructions, searching existing data sources, gathering 
and maintaining the data needed, and completing and reviewing the 
collection of information. Send comments on the reporting burden 
estimate or any other aspect of the requirements in this proposed rule 
to ITA Office of Policy at the ADDRESSES above and to OMB at the Office 
of Information and Regulatory Affairs, Office of Management and Budget, 
Washington, DC 20503 (Attention: ITA Desk Officer).
    Notwithstanding any other provision of law, no person is required 
to respond to, nor shall any person be subject to a penalty for failure 
to comply with a collection of information subject to the Paperwork 
Reduction Act unless that collection displays a valid OMB Control 
Number.

Executive Order 12866

    It has been determined that this rule is not significant for 
purposes of EO 12866.

Executive Order 12866

    This rule does not contain policies with federalism implications as 
that term is defined in EO 13132.

    Dated: July 11, 2002.
Faryar Shirzad,
Assistant Secretary for Import Administration.
[FR Doc. 02-18042 Filed 7-17-02; 8:45 am]
BILLING CODE 3510-DS-P