[Federal Register Volume 87, Number 200 (Tuesday, October 18, 2022)]
[Rules and Regulations]
[Pages 63262-63267]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-22151]



[[Page 63261]]

Vol. 87

Tuesday,

No. 200

October 18, 2022

Part IV





Department of Homeland Security





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U.S. Customs and Border Protection





Department of the Treasury





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19 CFR Parts 24 and 111





Elimination of Customs Broker District Permit Fee and Modernization of 
the Customs Broker Regulations; Final Rules

  Federal Register / Vol. 87 , No. 200 / Tuesday, October 18, 2022 / 
Rules and Regulations  

[[Page 63262]]


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DEPARTMENT OF HOMELAND SECURITY

U.S. Customs and Border Protection

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DEPARTMENT OF THE TREASURY

19 CFR Parts 24 and 111

[USCBP-2020-0010; CBP Dec. 22-22]
RIN 1515-AE43


Elimination of Customs Broker District Permit Fee

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 
(CBP) regulations to eliminate customs broker district permit fees. 
Concurrently with this final rule, CBP is publishing a final rule to, 
among other things, eliminate customs broker districts (see 
``Modernization of the Customs Broker Regulations'' RIN 1651-AB16). 
Specifically, CBP is transitioning all brokers to national permits and 
expanding the scope of the national permit authority to allow national 
permit holders to conduct any type of customs business throughout the 
customs territory of the United States. As a result of the elimination 
of customs broker districts, CBP is amending in this document the 
regulations to eliminate customs broker district permit fees.

DATES: Effective December 19, 2022.

FOR FURTHER INFORMATION CONTACT: Melba Hubbard, Chief, Broker 
Management Branch, (202) 863-6986, [email protected].

SUPPLEMENTARY INFORMATION: 

I. Background

    Section 641 of the Tariff Act of 1930, as amended (19 U.S.C. 1641), 
provides that individuals and business entities must hold a valid 
customs broker's license and permit to transact customs business on 
behalf of others. The statute also sets forth standards for the 
issuance of broker licenses and permits; provides for disciplinary 
action against brokers in the form of suspension or revocation of such 
licenses and permits or assessment of monetary penalties; and, provides 
for the assessment of monetary penalties against other persons for 
conducting customs business without the required broker's license. 
Section 641 authorizes the Secretary of the Treasury to prescribe rules 
and regulations relating to the customs business of brokers as may be 
necessary to protect the public and the revenue of the United States 
and to carry out the provisions of section 641.
    The regulations issued under the authority of section 641 are set 
forth in part 111 of title 19 of the Code of Federal Regulations (CFR) 
(19 CFR part 111) and provide for, among other things, fee payment 
requirements applicable to brokers under section 641 and 19 U.S.C. 
58c(a)(7). The existing customs broker regulations are based on a 
district system in which ports within a district handle entry, entry 
summary, and post-summary activity, and for which a broker district 
permit is required.
    On June 5, 2020, U.S. Customs and Border Protection (CBP) published 
a notice of proposed rulemaking (NPRM) in the Federal Register (85 FR 
34549), proposing the elimination of customs broker district permit 
fees in parts 24 and 111. The NPRM solicited public comments on the 
proposed rulemaking, with a 60-day comment period, which closed on 
August 4, 2020. No comments were received in response to this NPRM.
    In a concurrent NPRM, published elsewhere in the same issue of the 
Federal Register (see ``Modernization of the Customs Broker 
Regulations'' RIN 1651-AB16)(85 FR 34836)), CBP proposed to amend its 
regulations by modernizing the customs broker regulations to coincide 
with the development of CBP trade initiatives, including the Automated 
Commercial Environment (ACE) and the Centers of Excellence and 
Expertise (Centers). Specifically, CBP proposed to transition all 
brokers to national permits and expand the scope of the national permit 
authority to allow national permit holders to conduct any type of 
customs business throughout the customs territory of the United States. 
To accomplish this, CBP proposed to eliminate broker districts and 
district permits, which would also eliminate the need for district 
permit waivers and the requirement for brokers to maintain district 
offices. CBP received 55 public comments during the 60-day solicitation 
period and addressed those comments in a concurrent final rule 
document, published elsewhere in this issue of the Federal Register 
(see ``Modernization of the Customs Broker Regulations'' RIN 1651-
AB16)(hereinafter, referred to as the ``concurrent final rule 
document'').

II. Discussion of Regulatory Changes to Parts 24 and 111

Part 24

    Part 24 of title 19 of the CFR (19 CFR part 24) sets forth 
regulations concerning customs financial and accounting procedures. 
Section 24.22 describes the customs Consolidated Omnibus Budget 
Reconciliation Act (COBRA) user fees and corresponding limitations for 
certain services. Specifically, paragraph (h) of Sec.  24.22 deals with 
the annual customs broker permit user fee. In this final rule, CBP has 
eliminated in Sec. Sec.  24.22(h) and (i)(9), references to the customs 
broker district permit user fee, conforming with amendments in the 
concurrent final rule document, which eliminates broker districts and 
district permits.
    In the concurrent NPRM, CBP had proposed to add a new definition in 
Sec.  111.1 for a ``Designated Center'', which was defined as the 
Center through which an individual, partnership, association, or 
corporation submits an application for a broker's license, or as 
otherwise designated by CBP for already-licensed brokers. After further 
consideration of how CBP will be processing broker matters and taking 
into account the public comments received with regard to the proposed 
definition, CBP has determined in the concurrent final rule document to 
modify the proposed definition to better align with current and future 
processes regarding brokers.
    CBP has concluded that a definition of ``Processing Center'' much 
better reflects how CBP will manage broker applications and broker 
submissions.\1\ As described in the concurrent final rule document, the 
term ``Processing Center'' means the broker management operations of a 
Center that processes applications for licenses under Sec.  111.12(a) 
and permits under Sec.  111.19(b), as well as submissions by already-
licensed brokers required in part 111. The applications and submissions 
will be managed by Center personnel, who are broker management officers 
(BMOs) in 41 port locations throughout the U.S. customs territory.\2\ 
Current brokers will continue to submit any submissions to a location 
where the broker license was issued, and any new applicants for a 
license or permit should choose a location where the applicant intends 
to reside and or conduct customs business. Thus, CBP changed the 
proposed language in Sec.  24.22(h) from ``designated Center'' to 
``processing

[[Page 63263]]

Center (see Sec.  111.1)'', adding a reference as to where the 
definition for processing Center may be found.
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    \1\ In this document, CBP uses ``Processing Center'' in quotes 
to denote a replacement of the proposed term ``Designated Center''; 
when the words ``processing Center'' without quotation marks are 
used, CBP is referring to the Center of Excellence and Expertise 
that is actually performing a processing function.
    \2\ A chart of all 41 BMO locations can be found online on CBP's 
website at https://www.cbp.gov/trade/programs-administration/customs-brokers, by clicking on the tab titled ``Broker Management 
Officer (BMO) Contact Information.''
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Part 111

Elimination of District Permits
    Section 111.19 provides the procedures for obtaining broker 
permits, responsible supervision and control requirements for permits, 
and review procedures for the denial of a permit. Specifically, 
paragraph (c) describes permit fees. As CBP is eliminating district 
permits in the concurrent final rule document, this document makes 
conforming amendments to Sec.  111.19 by eliminating fees for district 
permits. In addition, CBP has removed the specific permit application 
and permit user fee amounts and replaced the numerical figures with a 
reference to the relevant fee provision in Sec.  111.96(b) and (c). CBP 
changed the proposed term ``designated Center'' to ``processing 
Center'', as explained above, in Sec.  111.19(c), and revised the 
second half of the second sentence of paragraph (c) to replace the 
reference to ``online'' submission of the fee payment with a reference 
to the use of a CBP-authorized EDI system. This last change was made to 
conform references to electronic submissions throughout part 111. In 
addition, CBP re-phrased the last part of the sentence in paragraph 
(c), without changing the meaning, to state that the fee needs to be 
submitted at the time the permit application is submitted. The changes 
to Sec.  111.96(b) can be found in the concurrent final rule document.
Elimination of District Permit Fees
    Section 111.96 describes fees required throughout part 111. 
Paragraph (c) of Sec.  111.96 describes the permit user fee. To reflect 
the elimination of broker districts and district permits, CBP has 
eliminated the customs broker district permit user fee, and specified 
that the user fee is applicable for national permits only, issued under 
Sec.  111.19(a).
    As discussed in the concurrent final rule document, CBP published 
an interim final rule that transferred certain trade functions from the 
port director to the Center director (see 81 FR 92978, December 20, 
2016). Similarly, certain broker management functions previously 
performed by the port directors are transferred to the processing 
Centers as part of this final rule. CBP has revised the last sentence 
of Sec.  111.96(c) by splitting it into two sentences, with the second 
sentence providing that the processing Center will notify the broker in 
writing of the failure to pay and the revocation of the permit. For the 
reasons explained above, CBP replaced the proposed term ``designated 
Center'' in Sec.  111.96(c) with the term ``processing Center''. CBP 
also removed the reference to ``director'' to clarify that submissions 
must be made to the broker management operations of a Center, meaning 
to one of the BMO locations throughout the U.S. customs territory. As 
not only Center directors will be handling broker matters, but any BMO, 
depending on where the broker license was issued, CBP determined that 
the removal of the reference to ``director'' was more appropriate.

III. Other Conforming Amendments

    The authority for part 111 currently provides a specific authority 
citation for Sec.  111.3. When the text of Sec.  111.3 was transferred 
to Sec.  111.2 in a final rule published in the Federal Register (65 FR 
13880) on March 15, 2000, CBP inadvertently did not revise the specific 
authority citation for either section. CBP has corrected this oversight 
in this final rule document by adding a specific authority citation for 
Sec.  111.2, and by removing the specific authority citation for Sec.  
111.3. An identical amendment is made in the concurrent final rule 
document.

IV. Conclusion

    Upon further consideration, CBP has decided to adopt, with changes 
as described above, as final the proposed regulations published in the 
Federal Register (85 FR 34549) on June 5, 2020.

V. Executive Orders 13563 and 12866

    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 mentioned above, on June 5, 2020, CBP published in the Federal 
Register an NPRM titled, ``Elimination of Customs Broker District 
Permit Fee,'' and received no comments from the public. Therefore, CBP 
adopts the regulatory amendments specified in the NPRM, with the 
addition of a change to the proposed term ``Designated Center.'' 
``Designated Center'' will be replaced with ``Processing Center,'' in 
accordance with the same change made in the concurrent final rule 
document, as explained above, as well as additional minor changes for 
consistency purposes. With the adoption of the proposed regulatory 
amendments, CBP applies the 2020 proposed rule's economic analysis 
approach to this final rule, updating the data as necessary.
    This final rule is not a ``significant regulatory action,'' under 
section 3(f) of Executive Order 12866. Accordingly, the Office of 
Management and Budget (OMB) has not reviewed this regulation. CBP has 
prepared the following analysis to help inform stakeholders of the 
impacts of this final rule.

1. Need and Purpose of the Final Rule

    Current customs broker regulations are based on the district system 
in which entry, entry summary, and post-summary activity are all 
handled by the ports within a permit district. In the concurrent final 
rule document, CBP is modernizing the regulations governing customs 
brokers to better reflect the current work environment and streamline 
the customs broker permitting process to save money. Under the terms of 
the concurrent final rule document, CBP is transitioning all brokers to 
national permits and expanding the scope of the national permit 
authority to allow national permit holders to conduct any type of 
customs business throughout the customs territory of the United States. 
By transitioning to a national permit, CBP is eliminating the 
requirement for brokers to maintain district permits and pay the annual 
user fee. Therefore, this final rule eliminates customs broker district 
permit annual user fees. CBP has prepared the following analysis to 
help inform stakeholders of the impacts of this final rule.

2. Background

    The customs territory of the United States is divided into seven 
customs regions. Within each region, the customs territory of the 
United States is further divided into districts; there are currently 40 
customs districts.\3\ Under the baseline, or the world as it was 
without this final rule, a district permit was required for each 
district in which a customs broker intended to conduct customs 
business. Brokers could apply for district permits either concurrently 
with their licenses or later on in their careers. Brokers who hold at 
least one

[[Page 63264]]

district permit also had the option to hold a national permit, which 
allows a broker to operate throughout the customs territory of the 
United States.\4\
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    \3\ In addition to the 40 geographically defined customs 
districts, there are three special districts that are responsible 
for specific types of imported merchandise. These special districts 
include districts 60, 70 and 80. District 60 refers to entries made 
by vessels under their own power. District 70 refers to shipments 
with a value under $800. District 80 refers to mail shipments. These 
three special districts do not require the use of a licensed broker 
with a specific district permit and as a result are not affected by 
this final rule.
    \4\ When first introduced in 2000, the national permit was 
restricted to certain activities, allowing a broker to place an 
employee in the facility of a client for whom the broker is 
conducting customs business; file electronic drawback claims; 
participate in remote location filing; and make representations 
after the entry summary has been accepted. Since the national permit 
was introduced, and with the full implementation of ACE, 
restrictions have been gradually eliminated such that only some 
activities requiring physical presence at the port require a 
district permit in lieu of a national permit. Those restrictions 
will be lifted with the concurrent final rule document in place.
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    The concurrent final rule document eliminates the district 
permitting process and automatically grants a national permit to each 
district permit holder who does not already hold a national permit. 
Going forward, licensed brokers have the option to apply for a single 
national permit either concurrently with their licenses or later in 
their careers. With this final rule in place, district permit user fees 
are eliminated, and brokers continue to pay permit fees only for 
national permits. Each district or national permit requires a one-time 
permit fee of $100 and an annual user fee.\5\ The annual user fee is 
$153.19 for calendar year 2022, but is adjusted for inflation each 
year.\6\ Given the uncertainty of future inflation, for the purposes of 
this analysis, we use this fee amount for the full period of analysis.
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    \5\ If a broker chooses to receive a permit with the license, 
then the $100 permit fee is waived. Under the new national 
permitting system, brokers receiving a national permit will pay the 
$100 permit fee regardless of when they do so.
    \6\ The annual user fee payable for calendar year 2022 is 
$153.19 (86 FR 66573). It will be adjusted for inflation each year. 
Sections 24.22 and 24.23 of title 19 CFR provide for and describe 
the procedures that implement the requirements of the Fixing 
America's Surface Transportation Act (FAST Act) (Pub. L. 114-94, 
December 4, 2015), which amended section 13031 of the Consolidated 
Omnibus Budget Reconciliation Act (COBRA), requiring the Secretary 
of the Treasury to adjust certain customs COBRA user fees and 
corresponding limitations to reflect certain increases in inflation. 
Specifically, section 24.22(k) sets forth the methodology to 
determine the change in inflation as well as the factor by which the 
fees and limitations will be adjusted, if necessary.
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    The number of new permits issued each year depends, in part, on the 
number of new licenses issued. CBP issues both individual broker 
licenses as well as corporate licenses, which may be held by 
partnerships, associations, or corporations.\7\ The number of licenses 
issued has been declining for the last several years at a rate of one 
percent for corporate licenses and four percent for individual licenses 
(see Table 1). Additionally, not all licensed brokers choose to apply 
for a permit. Although virtually all corporate license holders do hold 
a permit, many individual brokers work under the auspices of a 
corporate permit and never hold their own permit. Based on data from 
CBP's Broker Management Branch (BMB), approximately 13.5 percent of 
individual brokers hold a district permit.\8\
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    \7\ 19 U.S.C. 1641(b)(3). For any corporate license, at least 
one member of the organization must hold an individual license.
    \8\ Data pulled from ACE on May 10, 2021 and March 31, 2022.

                                           Table 1--Licensing History
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                                                          Total  licenses       Corporate          Individual
                          Year                                 issued        licenses issued    licenses issued
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2016...................................................                653                 21                632
2017...................................................                580                 16                564
2018...................................................                558                 27                531
2019...................................................                464                 15                449
2020...................................................                187                  7                180
2021...................................................                496                 31                465
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3. Benefits

    Brokers must pay an annual permit user fee for each permit held. 
The permit user fee is payable for each district permit and national 
permit a customs broker holds, including when a district permit is 
issued concurrently with the broker's license. As a result of the 
concurrent final rule document, district permits are eliminated and 
customs brokers only need to pay an annual user fee for a single 
national permit.\9\ Therefore, the savings accrued to brokers and CBP 
as a result of many fewer user fees paid qualifies as a benefit and not 
as a transfer payment because CBP is eliminating the district permits 
themselves, as well as the work that goes along with processing and 
issuing them.\10\
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    \9\ The reduction of the fee revenue will result in fewer funds 
available for CBP operations, but this is offset by the reduction in 
costs to process the permits. Thus, there is no net effect to CBP in 
reducing this revenue.
    \10\ As described in OMB Circular A-4, transfer payments occur 
when ``. . . monetary payments from one group [are made] to another 
[group] that do not affect total resources available to society.''
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    Under the baseline, both brokers holding existing permits and 
brokers issued new permits must pay the annual user fee for each permit 
held. As of January 2022, there were 15,226 active, licensed customs 
brokers.\11\ 2,365 brokers hold at least one district permit.\12\ Of 
those, 1,914 brokers hold a national permit in addition to their 
district permit(s). The 2,365 brokers who hold at least one district 
permit hold a total of 3,345 district permits, for an average of 1.4 
district permits per permitted broker.
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    \11\ Data supplied by BMB on May 10, 2021 and March 31, 2022. 
Data is pulled from ACE. The 12,861 brokers who do not hold any 
permits are unaffected by this final rule.
    \12\ This figure represents all current licensed brokers that 
are permit holders, regardless of what year they received their 
license.
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    Based on recent licensing history, CBP projects that over the 
period of analysis from 2022-2026, 2,072 new individual licenses and 75 
new corporate licenses will be issued.\13\ As stated above, 13.5 
percent of individual brokers and 100 percent of corporate brokers hold 
at least one district permit. Under the baseline, an average of 1.4 
district permits held by each broker results in 396 new individual 
permits and 105 new corporate permits, for a total of 501 permits. See 
Table 2 for a summary of licensing and permitting over the period of 
analysis under baseline conditions.
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    \13\ The COVID-19 pandemic and the resulting delays and closures 
resulted in anomalous data for 2020 for corporate licenses. 
Therefore, CBP removed 2020 from the projection, and used data from 
2015-2019 instead to project over the period of analysis from 2022-
2026.

[[Page 63265]]



                    Table 2--Projection of Licensing and Permitting Under Baseline Conditions
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                                              New          New
                  Year                     individual   individual    New corporate     New corporate     Total
                                            licenses      ermits     licenses issued       permits       permits
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2022....................................          447           86                 15               21       107
2023....................................          430           82                 15               21       103
2024....................................          414           79                 15               21       100
2025....................................          398           76                 15               21        97
2026....................................          383           73                 15               21        94
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    Total...............................        2,072          396                 75              105       501
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\*\ Totals may not sum due to rounding.

    With the concurrent final rule document in place, newly licensed 
brokers choosing to hold a permit require only a single national 
permit. Therefore, CBP will issue 355 new permits over the period of 
analysis (see Table 3). Because CBP is eliminating the district permit 
system, these 355 permits will be issued as national permits even 
though, under baseline conditions, they would have been district 
permits.

                               Table 3--Projection of Permits Under the Final Rule
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                                                              New          New                        Total new
                          Year                             individual   individual   New corporate     national
                                                            licenses     permits        permits        permits
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2022....................................................          447           60               15           75
2023....................................................          430           58               15           73
2024....................................................          414           56               15           71
2025....................................................          398           54               15           69
2026....................................................          383           52               15           67
                                                         -------------------------------------------------------
    Total...............................................        2,072          280               75          355
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\*\ Totals may not sum due to rounding.

    With the final rule in place, brokers currently holding only 
district permits or holding a national permit in addition to their 
district permit(s) continue to pay the annual user fee for a single 
national permit.\14\ As of January 2021, 9 brokers each hold more than 
one district permit and do not hold a national permit.\15\ Altogether, 
those brokers hold 18 district permits, for an average of 2 permits 
each. With the final rule in place, those brokers each pay for a single 
national permit instead of paying for the 18 district permits they 
currently collectively hold. Furthermore, there are 1,914 brokers 
holding at least one district permit and one national permit. Those 
brokers hold a total of 2,880 district permits. With the final rule in 
place, these brokers only need to pay the user fee for their national 
permits and will no longer pay fees for their 2,880 district permits. 
Overall, brokers holding permits at the start of the period of analysis 
will no longer need to pay for 2,889 permits.\16\
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    \14\ As stated above, those brokers only holding district 
permits will be automatically granted a national permit under the 
terms of the concurrent final rule document.
    \15\ Brokers who hold a single district permit will have that 
district permit transitioned to a national permit and will continue 
to pay the same amount in user fees. Therefore, they are financially 
unaffected by the final rule.
    \16\ This includes the 9 permits forgone by brokers holding only 
more than one district permit and the 2,880 district permits held by 
brokers holding both district and national permits.
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    Combining both existing and projected permits, over the period of 
analysis brokers who hold permits will pay the user fee for 364 permits 
under the terms of the final rule. This includes 355 new national 
permits issued during the period of analysis in place of 396 new 
district permits (see Tables 2 and 3 above). An additional 9 existing 
district permits held by brokers only holding district permits under 
the baseline will be transitioned to national permits. Those 9 brokers 
will no longer pay for the 9 additional district permits currently 
held, which will be eliminated. Finally, 1,914 brokers who hold a 
national permit and at least one district permit under the baseline 
will only continue paying for their national permits and will no longer 
pay for 2,880 district permits. Overall, brokers will no longer pay for 
3,035 district permits over the period of analysis. With a 2022 user 
fee of $153.19 per permit, brokers will save $2,281,330 from 2022-2026. 
See Table 4 for a summary of these savings.
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    \17\ Under the baseline, these permits would be issued as 
district permits. Under the final rule, they will be issued as 
national permits.
    \18\ For the first three columns, the total number of permits is 
additive throughout the period of analysis instead of at the end of 
the period (that is, all permits issued in 2021 must also be paid 
for in 2022, 2023, 2024, and 2025 in addition to new permits issued 
in those years) so the total is equal to the number of permits 
existing in the final year. The total savings are calculated by 
summing the savings in each year.

[[Page 63266]]



                                   Table 4--Total Savings [2022 U.S. dollars]
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                                           Total district     Total permits    District permits
                  Year                     permits  under   under the  final    no longer  paid       Savings
                                            the baseline        rule\17\              for
----------------------------------------------------------------------------------------------------------------
2022....................................             3,005                84               2,921        $447,393
2023....................................             3,108               158               2,950        $451,959
2024....................................             3,208               229               2,979        $456,398
2025....................................             3,305               298               3,007        $460,709
2026....................................             3,399               364               3,035        $464,871
                                         -----------------------------------------------------------------------
    Total\18\...........................             3,399               364               3,035      $2,281,330
----------------------------------------------------------------------------------------------------------------

4. Costs

    The elimination of the annual user fee for district permits does 
not result in any costs to brokers, but as noted above, this final rule 
yields the aforementioned savings.

5. Net Benefits

    The total annual monetized savings for customs brokers results from 
switching from a district permitting system to a national permitting 
system. Specifically, brokers will only pay the annual permit user fee 
for a single national permit instead of for each of the potentially 
several district permits held. As shown in Table 5 below, total savings 
over the period of analysis are approximately $2.3 million dollars.

  Table 5--Total Annual Undiscounted Savings for Brokers From 2022-2026
                           [2022 U.S. dollars]
------------------------------------------------------------------------
                          Year                             Total savings
------------------------------------------------------------------------
2022....................................................        $447,393
2023....................................................         451,959
2024....................................................         456,398
2025....................................................         460,709
2026....................................................         464,871
                                                         ---------------
    Total...............................................       2,281,330
------------------------------------------------------------------------
Note: Values may not sum to total due to rounding.

    Table 6 summarizes the monetized costs and benefits of this final 
rule to individual and corporate customs brokers. As shown, the total 
monetized present value net benefit of this final rule over a five-year 
period of analysis from 2022-2026 ranges from approximately $1.9 to $2 
million and the annualized net benefit is approximately $456,000. In 
2022, we estimate that 462 brokers will receive their broker licenses 
(447 individual licenses plus 15 corporate licenses). The adoption of 
this final rule will result in an average annual net benefit per broker 
in 2022 of $987 ($456,000 annualized net benefit/462 total new brokers 
for 2022).

                         Table 6--Present Value and Annualized Net Benefit of Final Rule
----------------------------------------------------------------------------------------------------------------
                                                       3% Discount rate                  7% Discount rate
                                              ------------------------------------------------------------------
                                                Present value      Annualized     Present value     Annualized
----------------------------------------------------------------------------------------------------------------
Total Cost...................................               $0              $0                $0              $0
Total Benefit................................        2,027,555         456,008         1,868,359         455,675
Total Net Benefit............................        2,027,555         456,008         1,868,359         455,675
----------------------------------------------------------------------------------------------------------------

VI. Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601 et seq.), as amended 
by the Small Business Regulatory Enforcement and Fairness Act of 1996, 
requires agencies to assess the impact of regulations on small 
entities. A small entity may be a small business (defined as any 
independently owned and operated business not dominant in its field 
that qualifies as a small business per the Small Business Act); a small 
not-for-profit organization; or a small governmental jurisdiction 
(locality with fewer than 50,000 people).
    The final rule will apply to all customs brokers, regardless of 
size. Accordingly, the final rule will affect a substantial number of 
small entities. However, as stated above in section V.5 ``Net 
Benefits,'' the final rule will result in an average annualized savings 
per customs broker of $987. Since brokers, on average, will benefit as 
a result of this final rule, and the savings are relatively small on a 
per broker basis, it will not have a significant impact on customs 
brokers. Accordingly, CBP certifies that this final rule does not have 
a significant impact on a substantial number of small entities.

VII. Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1995 (Pub. L. 
104-13, 44 U.S.C. 3507), an agency may not conduct, and a person is not 
required to respond to, a collection of information unless the 
collection of information displays a valid control number assigned by 
OMB. The collections of information contained in these

[[Page 63267]]

regulations are provided for by OMB control number 1651-0034 (CBP 
Regulations Pertaining to Customs Brokers) and by OMB control number 
1651-0076 (Recordkeeping Requirements). This final rule does not change 
the burden under these information collections.

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 her 
or his delegate) to approve regulations related to certain customs 
revenue functions.
    Chris Magnus, the Commissioner of CBP, having reviewed and approved 
this document, is delegating the authority to electronically sign this 
document to Robert F. Altneu, who is the Director of the Regulations 
and Disclosure Law Division for CBP, for purposes of publication in the 
Federal Register.

List of Subjects

19 CFR Part 24

    Accounting, Claims, Exports, Freight, Harbors, Reporting and 
recordkeeping requirements, Taxes.

19 CFR Part 111

    Administrative practice and procedure, Brokers, Penalties, 
Reporting and recordkeeping requirements.

Amendments to the CBP Regulations

    For the reasons set forth in the preamble, parts 24 and 111 of 
title 19 of the Code of Federal Regulations (19 CFR parts 24 and 111) 
are amended as set forth below.

PART 24--CUSTOMS FINANCIAL AND ACCOUNTING PROCEDURE

0
1. The general and specific authority citations for part 24 continue to 
read as follows:

    Authority:  5 U.S.C. 301; 19 U.S.C. 58a-58c, 66, 1202 (General 
Note 3(i), Harmonized Tariff Schedule of the United States), 1505, 
1520, 1624; 26 U.S.C. 4461, 4462; 31 U.S.C. 3717, 9701; Pub. L. 107-
296, 116 Stat. 2135 (6 U.S.C. 1 et seq.).
* * * * *
    Section 24.22 also issued under Sec. 892, Pub. L. 108-357, 118 
Stat. 1418 (19 U.S.C. 58c); Sec. 32201, Pub. L. 114-94, 129 Stat. 
1312 (19 U.S.C. 58c); Pub. L. 115-271, 132 Stat. 3895 (19 U.S.C. 
58c).


Sec.  24.22  [Amended]

0
2. In Sec.  24.22:
0
a. Paragraph (h) is amended by:
0
i. Removing the phrase ``each district permit and for'' in the first 
sentence;
0
ii. Removing the second sentence; and
0
iii. Removing the word ``port'' from the third sentence and adding in 
its place the words ``processing Center (see Sec.  111.1)''; and
0
b. Paragraph (i)(9) is amended by removing the phrase ``for district 
permits, class code 497;'' from the first sentence.

PART 111--CUSTOMS BROKERS

0
3. The general and specific authority citations for part 111 are 
revised to read as follows:

    Authority:  19 U.S.C. 66, 1202 (General Note 3(i), Harmonized 
Tariff Schedule of the United States), 1624; 1641.
    Section 111.2 also issued under 19 U.S.C. 1484, 1498;
    Section 111.96 also issued under 19 U.S.C. 58c, 31 U.S.C. 9701.

0
4. In Sec.  111.19, revise the section heading and paragraph (c) to 
read as follows:


Sec.  111.19  National permit.

* * * * *
    (c) Fees. A national permit issued under paragraph (a) of this 
section is subject to the permit application fee specified in Sec.  
111.96(b) and to the customs user permit fee specified in Sec.  
111.96(c). The fees must be paid at the processing Center (see Sec.  
111.1) or through a CBP-authorized EDI system at the time the permit 
application is submitted.
* * * * *

0
5. In Sec.  111.96, revise paragraph (c) to read as follows:


Sec.  111.96  Fees.

* * * * *
    (c) Permit user fee. Payment of an annual permit user fee defined 
in Sec.  24.22(h) of this chapter is required for a national permit 
granted to an individual, partnership, association, or corporate 
broker. The permit user fee is payable with the filing of an 
application for a national permit under Sec.  111.19(b), and for each 
subsequent calendar year at the processing Center referred to in Sec.  
111.19(b). The permit user fee must be paid by the due date as 
published annually in the Federal Register, and must be remitted in 
accordance with the procedures set forth in Sec.  24.22(i) of this 
chapter. When a broker submits an application for a national permit 
under Sec.  111.19(b), the full permit user fee must be remitted with 
the application, regardless of the point during the calendar year at 
which the application is submitted. If a broker fails to pay the annual 
permit user fee by the published due date, the permit is revoked by 
operation of law. The processing Center will notify the broker in 
writing of the failure to pay and the revocation of the permit.
* * * * *

Robert F. Altneu,
Director, Regulations & Disclosure Law Division, Regulations & Rulings, 
Office of Trade, U.S. Customs and Border Protection.

    Approved:
Thomas C. West, Jr.,
Deputy Assistant Secretary of the Treasury for Tax Policy.
[FR Doc. 2022-22151 Filed 10-17-22; 8:45 am]
BILLING CODE 9111-14-P