[Federal Register Volume 80, Number 117 (Thursday, June 18, 2015)]
[Notices]
[Pages 34924-34926]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-14968]
[[Page 34924]]
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DEPARTMENT OF HOMELAND SECURITY
U.S. Customs and Border Protection
Notice of Opportunity and Procedures To Request Assistance on
Tariff Classification and Customs Valuation Treatment by Other Customs
Administrations Affecting United States Exports
AGENCY: U.S. Customs and Border Protection, Department of Homeland
Security.
ACTION: General notice.
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SUMMARY: This document describes opportunities available to U.S.
exporters to obtain assistance from U.S. Customs and Border Protection
(CBP) to resolve matters concerning the tariff classification and
customs valuation applied to U.S. exports by other governments. By
publication of this notice, CBP invites U.S. exporters to submit
requests for such assistance.
DATES: June 18, 2015.
ADDRESSES: Requests for assistance may be addressed to U.S. Customs and
Border Protection, Office of International Trade, Regulations &
Rulings, Attention: Commercial and Trade Facilitation Division, 90 K
St. NE., 10th Floor, Washington, DC 20229-1177.
FOR FURTHER INFORMATION CONTACT: For tariff classification matters,
please contact Jacinto Juarez, Tariff Classification and Marking
Branch, at (202) 325-0027, or Greg Connor, Tariff Classification and
Marking Branch, at (202) 325-0025. For matters involving customs
valuation, please contact Yuliya Gulis, Valuation and Special Programs
Branch, at (202) 325-0042.
SUPPLEMENTARY INFORMATION:
Background
U.S. Customs and Border Protection (CBP) has direct responsibility
for enhancing U.S. economic competitiveness through the enforcement of
the laws of the United States and the fostering of lawful international
trade and travel. By reducing costs for industry and enforcing trade
laws against counterfeit, unsafe, and fraudulently imported goods, CBP
is working to facilitate legitimate trade, contribute to American
economic prosperity, and protect against risks to public health and
safety.
As part of CBP's mission to secure and facilitate lawful
international trade, CBP applies a number of legal requirements to
goods imported into the customs territory of the United States. In
almost all cases, imported goods must be ``entered'' (that is, declared
to CBP), and are subject to detention and examination by CBP officers
to ensure compliance with all laws and regulations enforced and
administered by CBP. As part of the entry process, goods must be
classified under the Harmonized Tariff Schedule of the United States
(HTSUS) and their customs value must be determined. CBP is responsible
for fixing the final tariff classification and customs valuation of
entered goods through a process called ``liquidation.'' In making
classification and valuation determinations, CBP applies two
international instruments: The Harmonized Commodity Description Coding
System (also known as the Harmonized System (HS)), and the Agreement on
Implementation of Article VII of the General Agreement on Tariffs and
Trade (GATT) 1994 (also known as the World Trade Organization (WTO)
Agreement on Customs Valuation or the ``WTO Valuation Agreement'').
Both international instruments share a similar goal of ensuring, at the
technical level, a standard or uniform approach to the interpretation
and application of tariff classification and valuation principles,
respectively.
Tariff Classification
Pursuant to the International Convention on the Harmonized
Commodity Description and Coding System (the ``HS Convention''), the
World Customs Organization (WCO) developed the HS. The HS is an
internationally-standardized product nomenclature used to classify
traded products by name and number, and is intended to ensure, at the
technical level, a uniform approach to the interpretation and
application of tariff classifications. The WCO, established in 1952 as
the Customs Co-operation Council (CCC), is an independent,
intergovernmental body whose mission is to enhance the effectiveness
and efficiency of customs administrations. The United States, along
with 149 other countries and the European Union, is a contracting party
to the HS Convention and uses the HS as a basis for its customs tariffs
and the collection of international trade statistics.
Subtitle B of title I of the Omnibus Trade and Competitiveness Act
of 1988 (Sec. 1201, Pub. L. 100-418, 102 Stat. 1147, Aug. 23, 1988 (19
U.S.C. 3001)) (the Act) provides for the approval and implementation in
the United States of the tariff classification principles set forth in
the HS Convention and its associated Harmonized System nomenclature.
More specifically, the Act provides for congressional approval of U.S.
accession to the HS Convention (section 1203), enactment of the HTSUS
(section 1204), and the publication of foreign trade statistics in
conformity with the HS nomenclature (section 1208). In addition, under
section 1209, the United States Trade Representative (USTR) is made
responsible for coordinating trade policy concerning the HS Convention.
Section 1210 of the Act provides that, subject to the policy
direction of USTR, the Departments of Treasury and Commerce and the
United States International Trade Commission (the Commission) shall
have responsibility for formulating U.S. positions on technical and
procedural issues relating to tariff classification under the HS
Convention, and for representing the United States government at the
WCO with respect thereto.
To foster international uniformity in tariff classification matters
under the HS, contracting parties have vested the WCO with
responsibility for securing uniform interpretation of the HS and its
periodic updating in light of developments in technology and changes in
trade patterns. See Article 7 of the HS Convention. The WCO manages
this process through the Harmonized System Committee (HSC), a committee
composed of contracting parties to the HS Convention which meets twice
a year to examine policy matters, take decisions on classification
questions, settle disputes, and prepare amendments to the HS
nomenclature and its Explanatory Notes. In accord with procedures
established by the WCO governing body (the WCO Council), the HSC also
prepares amendments updating the HS every four to six years.
On November 10, 1988, the Office of the U.S. Trade Representative
published in a Federal Register notice procedures to implement sections
1209 and 1210 of the Act. See 53 FR 45646. Therein, USTR designated the
Treasury Department, represented at the time by legacy U.S. Customs
Service (now CBP, as part of the Department of Homeland Security), to
lead the U.S. delegation at meetings of the HSC at the WCO in Brussels,
Belgium. Accordingly, Regulations and Rulings, within CBP's Office of
International Trade, leads U.S. delegations at semi-annual meetings of
the HSC at the WCO. CBP also serves with the Commission on U.S.
delegations at meetings of the Harmonized System Review Subcommittee,
which occur twice per year at the WCO.
Article 10 of the HS Convention provides that any dispute between
contracting parties concerning the
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interpretation or application of the HS Convention is to be settled by
negotiation between the contracting parties to the extent possible. If
this cannot be accomplished, the parties (that is, the governments
concerned) are to refer the dispute to the HSC for its consideration
and recommendations. The HSC, in turn, is to refer irreconcilable
disputes to the WCO Council for its recommendations.
Customs Valuation
With respect to customs valuation, the WTO Valuation Agreement
established a standard system for the valuation of imported goods. The
WTO Valuation Agreement ensures that determinations of the customs
value for the application of duty rates to imported goods are applied
in a neutral and uniform manner, precluding the use of arbitrary or
fictitious customs values. As one of 160 Members of the WTO, the United
States uses the Valuation Agreement as the basis for proper customs
valuation methodology.
Merchandise imported into the United States is appraised for
customs purposes in accordance with Section 402 of the Tariff Act of
1930, as amended by the Trade Agreements Act of 1979 (19 U.S.C. 1401a)
(TAA). Consistent with principles set forth in the WTO Valuation
Agreement, the primary method of appraisement is transaction value,
which is defined as ``the price actually paid or payable for the
merchandise when sold for exportation to the United States,'' plus
amounts for certain statutorily enumerated additions to the extent not
otherwise included in the price actually paid or payable. See 19 U.S.C.
1401a(b)(1). When transaction value cannot be applied, then the
appraised value is determined based on the other valuation methods in
the order specified in 19 U.S.C. 1401a(a).
The WTO Valuation Agreement established the Technical Committee on
Customs Valuation (TCCV), which operates under the auspices of the WCO,
with a view to ensuring the uniform interpretation and application of
internationally agreed upon customs valuation principles. The TCCV is
responsible for the examination of technical problems arising in the
day-to-day administration of the customs valuation systems of WTO
Valuation Agreement signatories. In addition, the TCCV renders advisory
opinions on appropriate solutions based upon the facts presented. The
TCCV meets twice a year at the WCO to discuss issues concerning the
interpretation and application of the WTO Valuation Agreement.
Pursuant to Annex II to the WTO Valuation Agreement, the United
States has the right to be represented at the TCCV to examine specific
problems arising from the administration of the customs valuation
systems of Members. The United States, which currently serves as Chair
to the TCCV, may nominate one delegate and one or more alternates to be
its representatives on the TCCV at semi-annual meetings in Brussels.
CBP represents the United States at the semi-annual meetings of the
TCCV at the WCO.
Additionally, under Article 19 of the WTO Valuation Agreement, the
United States may request consultation with a Member or Members if the
U.S. considers any benefit to it under the Agreement is being nullified
or impaired, or that the achievement of any objective of the Agreement
is being impeded, directly or indirectly, as a result of the actions of
another Member. Disputes arising under Article 19 of the WTO Valuation
Agreement may be referred to the TCCV for an examination of any
questions requiring technical consideration.
CBP Participation at Meetings of the Harmonized System Committee and
the Technical Committee on Customs Valuation
Accordingly, at meetings of the HSC and TCCV at the WCO, the United
States and other customs administrations participate and communicate
regularly on issues concerning the interpretation and application of
the HS and the WTO Valuation Agreement. Historically, it has been
useful for CBP to conduct discussions with other customs
administrations at the WCO with a view to reaching a common
understanding and interpretation of these instruments. Such discussions
can often serve to eliminate or resolve export issues for U.S. traders.
For example, in 2014 CBP was contacted by a U.S. exporter who
believed that its textile article was being misclassified by another
customs administration. The company brought to CBP's attention the
analysis applicable to the merchandise under published CBP rulings
available at http://rulings.cbp.gov. The company requested that CBP
contact the foreign customs administration to resolve the tariff
classification matter, and if the matter could not be resolved, the
U.S. company requested that CBP refer the matter to the HSC at the WCO.
Within 30 days of receiving the technical assistance request,
attorneys from the Tariff Classification and Marking Branch and import
specialists from the National Commodity Specialist Division, within the
Office of Regulations and Rulings (R&R), Office of International Trade
reviewed the underlying classification issue and determined that the
foreign customs administration's treatment of the merchandise was
inconsistent with the proper interpretation of the HS. Following CBP's
determination of the correct classification of the merchandise, R&R
attorneys raised the issue bilaterally with the foreign customs
administration and asked them to consider the matter.
Following this bilateral exchange, and within seven months of the
initial technical assistance request, CBP secured a favorable decision
by the foreign customs administration to classify the merchandise in a
manner consistent with the U.S. position and as requested by the
exporter. As a result of CBP's engagement with the foreign customs
administration, the U.S. company was able to obtain the correct tariff
treatment of its imported merchandise in the foreign country.
Inquiries Concerning Tariff Classification or Customs Valuation by
Other Customs Administrations Affecting U.S. Exports
By publication of this notice, U.S. Customs and Border Protection
emphasizes that opportunities exist to strengthen communication and
coordination between industry, CBP, other customs administrations, and
the WCO to advance the shared goal of facilitating international trade.
Greater collaboration with industry promotes improved technical
understanding among contracting parties and helps to foster uniformity
in the interpretation and application of the HS Convention and WTO
Valuation Agreement.
On matters involving non-uniform tariff classification or customs
valuation treatment by other customs administrations, individual
parties or firms do not have standing to initiate dispute settlement
procedures or consultations under the HS Convention or the WTO
Valuation Agreement. Consequently, for a U.S. individual or firm to
raise a tariff classification or customs valuation dispute, that party
must file an inquiry or complaint with the U.S. government and provide,
or assist in the collection of, any information relating to the matter
which may be required.
Accordingly, CBP hereby invites U.S. exporters to file with CBP
requests for assistance in resolving any tariff classification or
customs valuation treatment by other customs administrations affecting
U.S. exports.
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Of course, as a threshold technical matter, in order to provide the
requested assistance, CBP must agree with the position of the exporter
with regard to the specific matter brought to CBP's attention.
CBP will endeavor to provide an initial response to such requests
within 60 days of their receipt. Thereafter, in cooperation with the
appropriate agencies, CBP will consider the appropriate course of
action, including but not limited to the initiation of consultations or
dispute settlement at meetings of the HSC or TCCV at the WCO. The
inquirer or complainant will be informed of the progress achieved in
resolving the matter. Requests for assistance on tariff classification
or customs valuation treatment by other customs administrations
affecting U.S. exports should be addressed to U.S. Customs and Border
Protection, Office of International Trade, Regulations & Rulings,
Attention: Commercial and Trade Facilitation Division, 90 K St. NE.,
10th Floor, Washington, DC 20229-1177.
Confidentiality
Information submitted by U.S. exporters concerning requests for
assistance may, in some instances, include confidential commercial or
financial information, the disclosure of which could result in
competitive harm to the business submitter. Such information is,
generally, protected under the provisions of the Freedom of Information
Act (5 U.S.C. 552) (FOIA), the Privacy Act (5 U.S.C. 552a), and the
Trade Secrets Act (18 U.S.C. 1905). If confidential treatment is
requested, submitters should specifically designate the information it
considers confidential. Such requests will be handled in accordance
with CBP Regulations (19 CFR 103.35) regarding the protection of such
information.
Dated: June 12, 2015.
Brenda B. Smith,
Assistant Commissioner, Office of International Trade.
[FR Doc. 2015-14968 Filed 6-17-15; 8:45 am]
BILLING CODE 9111-14-P