02-20165. Entry of Certain Steel Products

AGENCY:

U.S. Customs Service, Department of the Treasury.

ACTION:

Notice of proposed rulemaking.

SUMMARY:

This document proposes to amend the Customs Regulations to set forth special requirements for the entry of certain steel products. The steel products in question are those listed by the President in Proclamation 7529 of March 5, 2002, pursuant to the safeguard provisions of section 203 of the Trade Act of 1974, including those products subject to country exceptions and product exclusions. The proposed amendment would require the inclusion of an import license number on the entry summary documentation filed with Customs for any steel product for which the U.S. Department of Commerce requires an import license under its steel licensing and import monitoring program.

DATES:

Comments must be submitted on or before September 9, 2002.

ADDRESSES:

Written comments are to be addressed to the U.S. Customs Service, Office of Regulations and Rulings, Attention: Regulations Branch, 1300 Pennsylvania Avenue NW., Washington, DC 20229. Submitted comments may be inspected at U.S. Customs Service, 799 9th Street NW., Washington, DC.

FOR FURTHER INFORMATION CONTACT:

Patty Fitzpatrick, Office of Field Operations (202-927-1106).

SUPPLEMENTARY INFORMATION:

Background

On March 5, 2002, President Bush signed Proclamation 7529 “To Facilitate Positive Adjustment to Competition From Imports of Certain Steel Products,” which was published in the Federal Register (67 FR 10553) on March 7, 2002. The Proclamation was issued under section 203 of the Trade Act of 1974, as amended (19 U.S.C. 2253), and was in response to determinations by the U.S. International Trade Commission (ITC) under section 202 of the Trade Act of 1974, as amended (19 U.S.C. 2252), that certain steel products were being imported into the United States in such increased quantities as to be a substantial cause of serious injury, or threat of serious injury, to the domestic industries producing like or directly competitive articles. The action taken by the President in the Proclamation consisted of the implementation of certain “safeguard measures,” specifically, the imposition of a tariff-rate quota on imports of specified steel slabs and an increase in duties on other specified steel products. The Proclamation included an Annex setting forth appropriate modifications to the Harmonized Tariff Schedule of the United States (HTSUS) to effectuate the President's action. The modifications to the HTSUS, which involved Subchapter III of Chapter 99 and included the addition of a new U.S. Note 11 and the addition of numerous new subheadings to cover the affected steel products, were made effective with respect to goods entered, or withdrawn from warehouse for consumption, on or after March 20, 2002.

On March 5, 2002, the President issued a Memorandum to the Secretary of the Treasury, the Secretary of Commerce, and the United States Trade Representative entitled “Action Under Section 203 of the Trade Act of 1974 Concerning Certain Steel Products,” which also was published in the Federal Register (67 FR 10593) on March 7, 2002. The Memorandum included an instruction to the Secretary of the Treasury and the Secretary of Commerce to establish a system of import licensing to facilitate the monitoring of imports of certain steel products. In addition, the Memorandum instructed the Secretary of Commerce, within 120 days of the effective date of the safeguard measures established by Proclamation 7529, to publish regulations in the Federal Register establishing the system of import licensing.

On July 18, 2002, the International Trade Administration of the Department of Commerce published in the Federal Register (67 FR 47338) a proposed rule to establish a steel licensing and surge monitoring system as instructed by the President in the March 5, 2002, Memorandum. Under the Commerce proposal, all importers of steel products covered by the President's section 203 action, including those products subject to country exemptions or product exclusions, would be required to obtain a steel import license and to provide the license information (that is, the license number) to Customs except in the case of merchandise which is eligible for informal entry under § 143.21 of the Customs Regulations (19 CFR 143.21). Commerce proposes to institute a registration system for steel importers, and steel import licenses would be issued to registered importers, customs brokers or their agents through an automatic steel import licensing system. Once registered, an importer or broker would submit the required license application information electronically to Commerce, and the system would then automatically issue a steel import license number for inclusion on the entry summary documentation filed with Customs.

Primary responsibility for the steel product import licensing and monitoring rests with the Secretary of Commerce. The Secretary of the Treasury, through the U.S. Customs Service, is responsible for the promulgation and administration of regulations regarding making entry of the subject merchandise into the United States. Accordingly, this document proposes to amend the Customs Regulations to provide an appropriate regulatory basis for the collection of the steel import license number on the entry summary documentation in accordance with the proposed regulatory standards promulgated by the Department of Commerce. The proposed amendment set forth in this document consists of the addition of a new § 12.145 (19 CFR 12.145) which requires the inclusion of a steel import license number on the entry summary in any case in which a steel import license number is required to be obtained under regulations promulgated by the Department of Commerce.

It should be noted that failure to provide the required steel import license number to Customs on a timely basis would constitute a breach of the terms of the importer's bond under § 113.62 of the Customs Regulations (19 CFR 113.62) and therefore could give rise to a claim for liquidated damages under the bond equal to the value of the merchandise involved in the default. However, a claim for liquidated damages under a Customs bond may be reduced or cancelled in accordance with mitigation guidelines published pursuant to section 623 of the Tariff Act of 1930, as amended (19 U.S.C. 1623). After new § 12.145 has been adopted as a final rule, Customs will publish appropriate guidelines under section 623. It is presently contemplated that those guidelines will include circumstances in which liquidated damage claims in these cases may be reduced to $50 for a late filing of the required information or to $100 in the case of a complete failure to file the information.

Comments

Before adopting this proposed regulation as a final rule, consideration will be given to any written comments timely submitted to Customs, including comments on the clarity of this proposed rule and how it may be made easier to understand. Comments submitted will be available for public inspection in accordance with the Freedom of Information Act (5 U.S.C. 552), § 1.4 of the Treasury Department Regulations (31 CFR 1.4), and § 103.11(b) of the 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 Office of Regulations and Rulings, U.S. Customs Service, 799 9th Street, NW., Washington, DC. Arrangements to inspect submitted comments should be made in advance by calling Mr. Joseph Clark at [phone].

Executive Order 12866

This document does not meet the criteria for a “significant regulatory action” as specified in E.O. 12866.

Regulatory Flexibility Act

Pursuant to the provisions of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.), it is certified that, if adopted, the proposed amendment will not have a significant economic impact on a substantial number of small entities. Customs believes that the proposed amendment, which involves the addition of only one data element to an existing required Customs form, will have a negligible impact on importer operations. Accordingly, the proposed amendment is not subject to the regulatory analysis or other requirements of 5 U.S.C. 603 and 604.

Paperwork Reduction Act

The collections of information in the current regulations have already been approved by the Office of Management and Budget (OMB) in accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3507) and assigned OMB control number 1515-0065 (Entry summary and continuation sheet). This rule does not involve any material change to the existing approved information collection.

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.

Drafting Information

The principal author of this document was Francis W. Foote, 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 12

• Bonds
• Customs duties and inspection
• Entry of merchandise
• Imports
• Prohibited merchandise
• Reporting and recordkeeping requirements
• Restricted merchandise

Proposed Amendment to the Regulations

For the reasons stated above, it is proposed to amend Part 12 of the Customs Regulations (19 CFR Part 12) as set forth below.

PART 12—SPECIAL CLASSES OF MERCHANDISE

1. The authority citation for Part 12 continues to read in part as follows:

Authority: 5 U.S.C. 301; 19 U.S.C. 66, 1202 (General Note 23, Harmonized Tariff Schedule of the United States (HTSUS)), 1624;

* * * * *

2. A new center heading and new § 12.145 are added to read as follows:

Steel Products

§ 12.145

Entry of certain steel products.

Except in the case of merchandise that is eligible for informal entry under § 143.21 of this chapter, in any case in which a steel import license number is required to be obtained under regulations promulgated by the U.S. Department of Commerce, that license number must be included on the entry summary, Customs Form 7501, or on an electronic equivalent.

Robert C. Bonner,

Commissioner of Customs.

Approved: August 6, 2002.

Timothy E. Skud,

Deputy Assistant Secretary of the Treasury.