[Federal Register Volume 63, Number 72 (Wednesday, April 15, 1998)]
[Proposed Rules]
[Pages 18344-18345]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-9964]
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DEPARTMENT OF COMMERCE
Bureau of the Census
15 CFR Part 30
[Docket No. 980331081-8081-01]
RIN 0607-AA22
Foreign Trade Statistics Regulations; Reporting the Value of
Foreign Military Sales Shipments
AGENCY: Bureau of the Census, Commerce.
ACTION: Notice of proposed rulemaking and request for comments.
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SUMMARY: The Bureau of the Census (Census Bureau) proposes amending the
Foreign Trade Statistics Regulations (FTSR) by adding a section
requiring exporters or their designated agents to include a foreign
military sales indicator code on the Shipper's Export Declaration (SED)
Form, Automated Export System (AES) Record Layout, and Automated Export
Reporting Program (AERP) Record Layout. This would apply whenever a
commercial exporter is shipping goods or reporting the repair of
military equipment under provisions of the Foreign Military Sales (FMS)
program. The Census Bureau is taking this action to assist the Bureau
of Economic Analysis (BEA), Department of Commerce, in improving the
accuracy and reliability of data collected on the value of exports made
under the FMS program. Exports under the FMS program are a component of
the U.S. balance of payments accounts and of the U.S. Gross Domestic
Product (GDP). The Census Bureau also is taking this action to assist
both the Census Bureau and BEA in improving the accuracy and
reliability of estimates presented in the Department of Commerce's
monthly release ``U.S. International Trade in Goods and Services.'' The
BEA has reviewed and approved this proposed rulemaking. The Department
of Treasury concurs with the provisions contained in this rule.
DATES: Written comments must be submitted on or before May 15, 1998.
ADDRESSES: Direct all written comments on this proposed rulemaking to
the Acting Director, Bureau of the Census, Room 2049, Federal Building
3, Washington, D.C. 20233.
FOR FURTHER INFORMATION CONTACT: Requests for additional information
should be directed to C. Harvey Monk, Jr., Chief, Foreign Trade
Division, Bureau of the Census, Room 2104, Federal Building 3,
Washington, D.C. 20233-6700, by telephone on (301) 457-2255 or by fax
on (301) 457-2645.
SUPPLEMENTARY INFORMATION:
Background
The FMS program is authorized under the provisions of the Arms
Export Control Act of 1976 (Public Law 90-629, as amended) and
predecessor legislation. Under this program, goods and services are
transferred directly to foreign governments and international
organizations by the U.S. Department of Defense (DOD). The delivery is
recorded by DOD at the time ownership is transferred to the foreign
government or international organization. This recording is consistent
with balance of payments accounting principles. The transfer may be
made abroad, in the United States for shipment abroad, or for use in
the United States. In the latter case, although the goods physically
remain in the United States (for example, equipment to train foreign
personnel), ownership is transferred to a foreign government. Transfers
also may be made from stocks at U.S. military installations abroad. The
SEDs are not required for FMS transactions by DOD agencies; SEDs are
required by commercial exporters, but these SEDs do not separately
identify FMS transactions.
Program Requirements
The DOD submits quarterly reports to BEA under provisions of the
Office of Management and Budget's (OMB) Statistical Policy Directive
No. 19, ``Reports of the Department of Commerce on International
Transactions.'' These reports contain details of FMS deliveries by
broad product category, by country of destination, and by military
agency (Army, Navy, Air Force, and other DOD agencies). The reports
include deliveries carried out by both DOD and commercial exporters.
The BEA prepares estimates of FMS deliveries based on these reports for
the quarterly balance of payments accounts.
The DOD also submits monthly reports to the Census Bureau that
[[Page 18345]]
contain detailed statistics on military assistance (Foreign Aid/Grant
Aid) shipments made from the United States by the DOD and shipments
made under the FMS program by the military agencies. These monthly
reports are furnished to the Census Bureau in lieu of the SED in order
to facilitate shipments of material under Grant Aid and FMS auspices.
However, these reports do not cover FMS deliveries by commercial
exporters, which comprise a significant share of FMS deliveries.
In order to reconcile the two sets of data provided by DOD, the
Census Bureau is proposing to add an FMS indicator code to the SEDs and
the electronic transmissions required from commercial exporters. The
addition of this indicator code will assure more accurate
identification of FMS transactions in the goods data reported to the
Census Bureau and enable BEA to make a more accurate estimate of this
class of FMS transactions when it removes them from the goods data to
avoid counting these transactions twice when it compiles the balance of
payments accounts. An FMS indicator code on the SEDs and electronic
transmissions from commercial exporters will permit BEA and the Census
Bureau to improve the accuracy and reliability of its balance of
payments and GDP estimates, as well as the estimates published in the
``U.S. International Trade in Goods and Services'' release.
The Census Bureau is proposing to amend Section 30.7(p) of the FTSR
to add paragraph (5) requiring commercial exporters to identify those
exports that represent FMS deliveries with an ``M'' indicator code in
Item (16) on Commerce Form 7525-V and in Item (23) on Commerce Form
7525-V-ALT (Intermodal) on the paper SEDs, with an ``FS'' Export
Information Code on the Commodity Line Item Description (CL1) record on
the AES record layout, and with a ``3'' indicator code in field 2
(Type) of the AERP record layout for participants of the AERP.
Rulemaking Requirements
This rule is exempt from all requirements of Section 553 of the
Administrative Procedure Act because it deals with a foreign affairs
function (5 U.S.C. (A)(1)). However, this rule is being published as a
proposed rule, with an opportunity for public comment because of the
importance of the issues raised by this rulemaking.
Regulatory Flexibility Act
Because a notice of proposed rulemaking is not required by 5 U.S.C.
553 or any other law, a Regulatory Flexibility Analysis is not required
and has not been prepared (5 U.S.C. 603(a)).
Executive Orders
This rule has been determined to be not significant for purposes of
Executive Order 12866. This rule does not contain policies with
federalism implications sufficient to warrant preparation of a
federalism assessment under Executive Order 12612.
Paperwork Reduction Act
Notwithstanding any other provisions of law, no person is required
to respond to, nor shall a person be subject to a penalty for failure
to comply with, a collection of information subject to the requirements
of the Paperwork Reduction Act (PRA) unless that collection of
information displays a currently valid OMB control number.
This rule covers collections of information subject to the
provisions of the PRA, which are cleared by the OMB under OMB control
number 0607-0152.
This rule will not impact the current reporting-hour burden
requirements as approved under OMB control number 0607-0152 under
provisions of the Paperwork Reduction Act of 1995, Public Law 104-13.
List of Subjects in 15 CFR Part 30
Economic statistics. Foreign trade. Exports. Reporting and record
keeping requirements.
For the reasons set out in the preamble, it is proposed that part
30 be amended as follows:
PART 30--FOREIGN TRADE STATISTICS REGULATIONS
1. The authority citation for 15 CFR Part 30 continues to read as
follows:
Authority: 5 U.S.C. 301; 13 U.S.C. 301-307; Reorganization Plan
No. 5 of 1950 (3 CFR 1949-1953 Camp., 1004); Department of Commerce
Organization Order No. 35-2A. August 4, 1975, 40 CFR 42765.
Subpart A--General Requirements--Exporter
2. Section 30.7 is proposed to be amended by adding paragraph
(p)(5) to read as follows:
Sec. 30.7 Information required on Shipper's Export Declarations.
* * * * *
(p) * * *
(5) Foreign Military Sales (FMS) indicator. For any export that
represents the delivery of goods or the repair of military equipment
under provisions of the FMS program, an ``M'' indicator code should be
included in Item (16) on Commerce Form 7525-V and in Item (23) on
Commerce Form 7525-V-ALT (Intermodal) of the paper SED, with an ``FS''
Export Information Code on the Commodity Line Item Description (CL1)
field of the Automated Export System (AES) record layout, and a ``3''
indicator code in field 2 (Type) of the Automated Export Reporting
Program (AERP) record layout. This indicator code should be used in
lieu of the domestic (D) or foreign (F) indicator code required in
those fields on the SED Form, the AES record, and the AERP record. The
FMS indicator code will serve to identify more accurately that segment
of U.S. exports that represent FMS deliveries in the U.S. export
statistics.
* * * * *
Dated: March 25, 1998.
James F. Holmes,
Acting Director, Bureau of the Census.
[FR Doc. 98-9964 Filed 4-14-98; 8:45 am]
BILLING CODE 3510-07-P
