[Federal Register Volume 82, Number 109 (Thursday, June 8, 2017)]
[Rules and Regulations]
[Pages 26582-26584]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-11908]


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DEPARTMENT OF HOMELAND SECURITY

U.S. Customs and Border Protection

DEPARTMENT OF THE TREASURY

19 CFR Part 12

[CBP Dec. No. 17-04]
RIN 1515-AE22


Merchandise Produced by Convict, Forced, or Indentured Labor; 
Conforming Amendment and Technical Corrections

AGENCY:  U.S. Customs and Border Protection, Department of Homeland 
Security; Department of the Treasury.

ACTION: Final rule.

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SUMMARY: This document amends the U.S. Customs and Border Protection 
regulations to reflect section 910 of the Trade Facilitation and Trade 
Enforcement Act of 2015 by removing the ``consumptive demand'' clause 
from the regulations concerning the prohibition on the importation of 
merchandise produced by convict, forced, or indentured labor. It also 
updates the regulations to reflect the correct name of the agency and 
includes a minor procedural change with regard to the filing of proof 
of admissibility.

DATES: This final rule is effective on June 8, 2017.

FOR FURTHER INFORMATION CONTACT: Thomas Kendrick, Trade Remedy Law 
Enforcement Directorate, Office of Trade, [email protected], 
(202) 863-6057.

SUPPLEMENTARY INFORMATION: 

I. Background

    Section 307 of the Tariff Act of 1930, as amended (19 U.S.C. 1307) 
prohibits

[[Page 26583]]

the importation of merchandise that has been mined, produced, or 
manufactured, wholly or in part, in any foreign country by forced 
labor, including prison labor and forced child labor. Despite this 
general prohibition, the Tariff Act of 1930 included a ``consumptive 
demand'' clause, which allowed for the importation of forced-labor-
derived goods if the goods were not produced in such quantities in the 
United States as to meet the ``consumptive demands'' of the United 
States.
    On February 24, 2016, the President signed into law the Trade 
Facilitation and Trade Enforcement Act of 2015 (TFTEA) (Pub. L. 114-
125). Section 910 of TFTEA repeals the ``consumptive demand'' clause in 
section 307 of the Tariff Act of 1930, thereby eliminating the 
consumptive demand exception to the prohibition on importation of goods 
made with convict labor, forced labor, or indentured servitude. This 
amendment went into effect on March 10, 2016.

II. Amendments to the Regulations To Remove the ``Consumptive Demand'' 
Clause

    The regulations corresponding to section 307 of the Tariff Act of 
1930, as amended, are contained within title 19 of the Code of Federal 
Regulations (CFR) at 19 CFR 12.42-12.45, ``Merchandise Produced by 
Convict, Forced, or Indentured Labor.'' This document amends these 
regulations to remove the ``consumptive demand'' exception from the 
general prohibition against the importation of goods produced by 
convict, forced, or indentured labor. While U.S. Customs and Border 
Protection (CBP) has been enforcing the ban on the importation of 
merchandise produced through convict, forced, or indentured labor 
without taking consumptive demand into consideration since section 910 
of TFTEA has gone into effect, this conforming amendment is necessary 
to ensure that 19 CFR reflects the recent statutory amendment. This 
rulemaking is limited to this conforming amendment and other minor non-
substantive amendments.
    The non-substantive amendments included in this rulemaking are 
amendments to correct a spelling error, replace outdated references to 
``Customs'' with ``CBP'', and make a minor procedural change. The 
change in terminology from ``Customs'' to ``CBP'' is consistent with 
the transfer of the legacy U.S. Customs Service of the Department of 
the Treasury to the Department of Homeland Security (DHS) in 2003 and 
the subsequent renaming of the agency as U.S. Customs and Border 
Protection (CBP) by DHS on March 31, 2007. See 72 FR 20131, April 23, 
2007. See also 75 FR 12445, March 16, 2010.
    The procedural change involves the addition of a person (i.e., the 
Port Director) to whom an importer may submit proof of admissibility 
when contending that an article was not mined, produced, or 
manufactured in any part with the use of a prohibited class of labor. 
The current regulation (19 CFR 12.43(b)) provides that the importer 
shall submit this information to the Commissioner. To provide more 
flexibility, and for consistency with 19 CFR 12.42(b), CBP is amending 
this provision to allow for the proof of admissibility to be submitted 
to the Commissioner of CBP or to the Port Director.

III. Inapplicability of Notice and Delayed Effective Date

    The Administrative Procedure Act (APA) generally requires agencies 
to publish a notice of proposed rulemaking in the Federal Register and 
provide interested persons the opportunity to submit comments. See 5 
U.S.C. 553(b) and (c). However, certain exceptions are provided.
    The APA provides an exception from notice and comment procedures 
when an agency finds for good cause that those procedures are 
``impracticable, unnecessary, or contrary to the public interest.'' See 
5 U.S.C. 553(b)(3)(B). In this case, CBP finds that good cause exists 
for dispensing with notice and public procedure as unnecessary because 
the conforming amendment and technical corrections set forth in this 
document are required to ensure that 19 CFR reflects both the recent 
amendments to the underlying statutory authority effected by section 
910 of TFTEA and the most up-to-date terminology. For this same reason, 
pursuant to 5 U.S.C. 553(d)(3), CBP finds that good cause exists for 
dispensing with the requirement for a delayed effective date.
    The APA also provides an exception to the prior notice and comment 
requirement for ``rules of agency organization, procedure, or 
practice.'' See 5 U.S.C. 553(b)(A). The procedural change discussed 
above, i.e., including an additional person to whom an importer may 
submit proof of admissibility when contending that an article was not 
mined, produced, or manufactured in any part with the use of a 
prohibited class of labor, is a minor change that has been promulgated 
for agency efficiency purposes, and is a rule of internal agency 
procedure.

IV. Statutory and Regulatory Requirements

A. Executive Orders 12866 and 13563

    Executive Orders 13563 and 12866 direct agencies to assess the 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). Executive 
Order 13563 emphasizes the importance of quantifying both costs and 
benefits, of reducing costs, of harmonizing rules, and of promoting 
flexibility. As these amendments are a conforming amendment and 
technical corrections to the regulations to reflect statutory changes 
and to make minor non-substantive edits, these amendments do not meet 
the criteria for a ``significant regulatory action,'' under section 
3(f) of Executive Order 12866.
The Regulatory Flexibility Act
    Because this document is not subject to the notice and public 
procedure requirements of 5 U.S.C. 553, it is not subject to the 
provisions of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.).

B. Paperwork Reduction Act

    There is no new collection of information required in this 
document; therefore, the provisions of the Paperwork Reduction Act of 
1995 (44 U.S.C. 3507) are inapplicable.

C. Signing Authority

    This regulation is being issued in accordance with 19 CFR 
0.1(a)(1), pertaining to the Secretary of the Treasury's authority (or 
that of his delegate) to approve regulations related to certain customs 
revenue functions.

List of Subjects in 19 CFR Part 12

    Customs duties and inspection, Reporting and recordkeeping 
requirements.

Amendments to the CBP Regulations

    For the reasons stated above in the preamble, CBP amends 19 CFR 
part 12 as set forth below.

PART 12--SPECIAL CLASSES OF MERCHANDISE

0
1. The general authority citation for part 12 continues and the 
specific authority for Sections 12.42 through 12.44 is revised to read 
as follows:

    Authority: 5 U.S.C. 301; 19 U.S.C. 66, 1202 (General Note 3(i), 
Harmonized Tariff

[[Page 26584]]

Schedule of the United States (HTSUS)), 1624.
* * * * *
    Sections 12.42 through 12.44 also issued under 19 U.S.C. 1307, 
Pub. L. 105-61 (111 Stat. 1272), and Public L. 114-125 (130 Stat. 
122);
* * * * *


0
2. Amend Sec.  12.42 as follows:
0
a. Revise the section heading;
0
b. In paragraph (a), remove the words ``Commissioner of Customs'' and 
add in their place ``Commissioner of CBP'';
0
c. Revise paragraph (b);
0
d. In paragraphs (c), (d), (e), and (f) remove the words ``Commissioner 
of Customs'' and add in their place ``Commissioner of CBP''; and
0
e. In paragraph (g), remove the word ``specifed'' and add in its place 
``specified'' and remove the word ``Customs'' and add in its place 
``CBP'';
    The revisions read as follows:


Sec.  12.42   Findings of Commissioner of CBP.

* * * * *
    (b) Any person outside CBP who has reason to believe that 
merchandise produced in the circumstances mentioned in paragraph (a) of 
this section is being, or is likely to be, imported into the United 
States may communicate his belief to any port director or the 
Commissioner of CBP. Every such communication shall contain, or be 
accompanied by:
    (1) A full statement of the reasons for the belief;
    (2) A detailed description or sample of the merchandise; and
    (3) All pertinent facts obtainable as to the production of the 
merchandise abroad.
* * * * *


Sec.  12.43   [Amended]

0
3. In Sec.  12.43, in paragraphs (a) and (b), remove the words 
``Commissioner of Customs'' and add in their place the words ``port 
director or Commissioner of CBP''.


Sec.  12.44   [Amended]

0
5. Amend Sec.  12.44 as follows:
0
a. In paragraphs (a) and (b) remove all instances of the words 
``Commissioner of Customs'' and add in their place ``Commissioner of 
CBP''; and
0
b. In paragraph (c) remove the word ``Customs'' and add in its place 
``CBP''.

    Dated: June 5, 2017.
Kevin K. McAleenan,
Acting Commissioner, U.S. Customs and Border Protection.
Timothy E. Skud,
Deputy Assistant Secretary of the Treasury.
[FR Doc. 2017-11908 Filed 6-7-17; 8:45 am]
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