[Federal Register Volume 64, Number 52 (Thursday, March 18, 1999)]
[Proposed Rules]
[Pages 13370-13372]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-6640]
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DEPARTMENT OF THE TREASURY
Customs Service
19 CFR Part 4
RIN 1515-AC35
Vessel Equipment Temporarily Landed for Repair
AGENCY: U.S. Customs Service, Department of the Treasury.
ACTION: Proposed rule.
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SUMMARY: This document proposes to amend the Customs Regulations to
provide for the temporary landing in the United States of vessel
equipment in need of repair, without requiring entry of that equipment
under a Temporary Importation Bond (TIB). It is proposed that such
equipment be permitted to be landed for repair and relading aboard the
same vessel, subject to Customs issuance of a special permit or license
for the landed equipment, under an International Carrier Bond.
Uncertainty exists whether the relading of repaired equipment on
vessels departing the United States would satisfy the TIB requirement
that such merchandise be exported. The proposed amendments will
eliminate this uncertainty while still allowing Customs adequate
control over such unladings and ladings.
DATES: Comments must be received on or before May 17, 1999.
ADDRESSES: Written comments may be addressed to and inspected at the
Regulations Branch, U.S. Customs Service, 1300 Pennsylvania Avenue,
N.W., 3rd Floor, Washington, D.C. 20229.
[[Page 13371]]
FOR FURTHER INFORMATION CONTACT: Larry L. Burton, Office of Regulations
and Rulings, 202-927-1287.
SUPPLEMENTARY INFORMATION:
Background
Section 446, Tariff Act of 1930, as amended (19 U.S.C. 1446),
provides that vessels arriving in the United States from foreign ports
may retain vessel equipment and other named items aboard without the
payment of duty. The statute also provides, however, that any of the
named items that are landed and delivered from such a vessel are
considered and treated as imported merchandise.
The cited statute is implemented by Sec. 4.39 of the Customs
Regulations (19 CFR 4.39), paragraph (b) of which provides that any
articles other than cargo or baggage that are landed for delivery for
consumption in this country are treated the same as any other imported
article. Articles imported for consumption into the United States are
subject to merchandise entry and the payment of applicable duty.
It is Customs' view that when necessary equipment is unladed from a
vessel only temporarily for the purpose of being repaired and then
reladed, it is not being delivered for consumption into the commerce of
the United States. It is also clear, however, that when anything is
landed in the United States, Customs has the duty and responsibility to
exercise sufficient control and to protect the revenue from any
unlawful introduction of merchandise into the commerce of the country.
There has been a lack of uniformity in the treatment that Customs
has accorded vessel equipment temporarily landed for repair and
relading. Some ports have employed Temporary Importation Bond (TIB)
procedures in seeking to provide the necessary mechanisms for Customs
control and the protection of the revenue, but a problem exists with
the use of a TIB for this purpose. While a TIB would adequately protect
the revenue during the period when vessel equipment was in the United
States, the bond provisions could only be satisfied and potential
liability extinguished when the covered equipment was exported from the
United States. Exportation is defined in Sec. 101.1 of the Customs
Regulations (19 CFR 101.1), which provides that something is exported
when it is separated from the goods of this country with the intent
that it be made a part of the goods belonging to some foreign country.
Customs does not believe that relading vessel equipment that is
intended to remain aboard that vessel meets the definition of
exportation so that TIB bond liability may be adequately terminated.
Section 4.30 of the Customs Regulations (19 CFR 4.30) provides that
in all cases relevant to the present circumstances, no cargo, baggage,
or other articles may be unladed from or laded upon any vessel arriving
directly or indirectly from a foreign port or place, unless the Customs
port director issues a permit allowing the activity (Customs Form
3171). This would provide adequate control by Customs over equipment
unladings and ladings in terms of advance notice and actual knowledge.
Further, operators of vessels, or vessel agents acting in their
stead, either have in place or can be required by local Customs
officials to obtain International Carrier Bonds as reproduced in
Sec. 113.64, Customs Regulations (19 CFR 113.64). Paragraph (b) of that
bond provision (Sec. 113.64(b)) obligates the bond for matters relating
to the unlading, safekeeping, and disposition of merchandise, supplies,
crew purchases, and other articles to be found on a vessel. This would
provide adequate protection of the revenue in terms of any potential
introduction of temporarily landed vessel equipment into the commerce
of the United States.
This proposal would add a new paragraph (g) to Sec. 4.39 of the
Customs Regulations (19 CFR 4.39(g)) to provide that equipment of a
vessel arriving either directly or indirectly from a foreign port or
place, if in need of repair, may be landed temporarily in order to be
repaired. Unlading and relading would be in accord with the permit
provisions of Sec. 4.30, and the appropriate International Carrier Bond
would be obligated as provided under Sec. 113.64(b).
Comments
Before adopting this proposal, consideration will be given to any
written comments that are timely submitted to Customs. Comments
submitted will be available for public inspection in accordance with
the Freedom of Information Act (5 U.S.C. 552), Sec. 1.4, Treasury
Department Regulations (31 CFR 1.4), and Sec. 103.11(b), Customs
Regulations (19 CFR 103.11(b)), on regular business days between the
hours of 9:00 a.m. and 4:30 p.m. at the Regulations Branch, U.S.
Customs Service, 1300 Pennsylvania Avenue, N.W., 3rd Floor, Washington,
D.C.
Regulatory Flexibility Act and Executive Order 12866
Because the proposed rule would merely provide a different method
to allow vessel equipment to be temporarily landed for repair without
the payment of duty, it is certified pursuant to the Regulatory
Flexibility Act (5 U.S.C. 601 et seq.) that, if adopted, the proposed
rule will not have a significant economic impact on a substantial
number of small entities. Accordingly, it is not subject to the
regulatory analysis or other requirements of 5 U.S.C. 603 and 604. Nor
does the document meet the criteria for a ``significant regulatory
action'' as specified in E.O. 12866.
Paperwork Reduction Act
The collections of information contained in this notice of proposed
rulemaking have been previously reviewed and approved by the Office of
Management and Budget (OMB) in accordance with the Paperwork Reduction
Act of 1995 and assigned OMB control numbers 1515-0013 (Application-
Permit-Special License, Unlading-Lading, Overtime Services (Customs
Form 3171)) and 1515-0144 (Customs Bond Structure (Customs Form 301 and
Customs Form 5297)). An agency may not conduct or sponsor, and a person
is not required to respond to, a collection of information unless the
collection of information displays a valid control number assigned by
OMB. Although this document restates the collections of information
without substantive change, comments are specifically requested
concerning:
Whether the proposed collections of information are necessary for
the proper performance of the functions of the agency, including
whether the information will have practical utility;
The accuracy of the estimated burden associated with the proposed
collections of information (see below);
How to enhance the quality, utility, and clarity of the information
to be collected;
How to minimize the burden of complying with the proposed
collections of information, including the application of automated
collection techniques or other forms of information technology; and
Estimates of capital or start-up costs and costs of operation,
maintenance, and purchase of services to provide information.
The collection of information in this proposed regulation is in
Sec. 4.39. This information is required and will be used to effect the
temporary unlading and lading of vessel equipment landed for repair, in
order to ensure enforcement of the Customs and related laws and the
[[Page 13372]]
protection of the revenue. The likely respondents are business or other
for-profit institutions.
Estimated annual reporting and/or recordkeeping burden: one hour.
Estimated average annual burden per respondent/recordkeeper: one
hour.
Estimated number of respondents and/or recordkeepers: one.
Estimated annual frequency of responses: one.
Comments concerning suggestions for reducing the burden of the
collections of information should be sent to the Regulations Branch,
Office of Regulations and Rulings, U.S. Customs Service, 1300
Pennsylvania Avenue, N.W., 3rd Floor, Washington, D.C. 20229. A copy
should also be sent to U.S. Customs Service, Information Services
Group, Attention: J. Edgar Nichols, Room 3.2-C, 1300 Pennsylvania
Avenue, N.W., Washington, D.C. 20229. Comments should be submitted
within the time frame that comments are due regarding the substance of
the proposal.
Drafting Information: The principal author of this document was
Larry L. Burton, Office of Regulations and Rulings, U.S. Customs
Service. However, personnel from other offices participated in its
development.
List of Subjects in 19 CFR Part 4
Customs duties and inspection, Entry, Inspection, Merchandise,
Reporting and recordkeeping requirements, Vessels.
Proposed Amendments to the Regulations
It is proposed to amend part 4, Customs Regulations (19 CFR part
4), as set forth below.
PART 4--VESSELS IN FOREIGN AND DOMESTIC TRADES
1. The general authority citation for part 4 as well as the
specific authority citation for Sec. 4.39 would continue to read as
follows:
Authority: 5 U.S.C. 301; 19 U.S.C. 66, 1431, 1433, 1434, 1624;
46 U.S.C. App. 3, 91;
* * * * *
Section 4.39 also issued under 19 U.S.C. 1446;
* * * * *
2. It is proposed to amend Sec. 4.39 by adding a new paragraph (g)
to read as follows:
Sec. 4.39 Stores and equipment of vessels and crews' effects; unlading
or lading and retention on board.
* * * * *
(g) Equipment of a vessel arriving either directly or indirectly
from a foreign port or place, if in need of repairs in the United
States, may be unladen from and reladen upon the same vessel under the
procedures set forth in Sec. 4.30 relating to the granting of permits
and special licenses on Customs Form 3171 (CF 3171). Adequate
protection of the revenue is insured under the appropriate
International Carrier Bond during the period that equipment is
temporarily landed for repairs (see Sec. 113.64(b) of this chapter),
and so resort to the procedures established for the temporary
importation of merchandise under bond is unnecessary. Once equipment
which has been unladen under the terms of a CF 3171 has been reladen on
the same vessel, potential liability for that transaction existing
under the bond will be extinguished.
Approved: February 23, 1999.
Raymond W. Kelly,
Commissioner of Customs.
John P. Simpson,
Deputy Assistant Secretary of the Treasury.
[FR Doc. 99-6640 Filed 3-17-99; 8:45am]
BILLING CODE 4820-02-P
