Customs bonded warehouses: Inventory reports filing,

[Federal Register: October 26, 1999 (Volume 64, Number 206)]

[Rules and Regulations]

[Page 57564-57565]

From the Federal Register Online via GPO Access [wais.access.gpo.gov]

[DOCID:fr26oc99-11]

DEPARTMENT OF THE TREASURY

Customs Service

19 CFR Part 19

[T.D. 99-78]

RIN 1515-AC41

Customs Bonded Warehouses

AGENCY: Customs Service, Department of the Treasury.

ACTION: Final rule.

SUMMARY: This document amends the Customs Regulations regarding the filing of certain inventory reports by bonded warehouse proprietors. Instead of requiring that these reports be filedwith Customs, the document requires that bonded warehouse proprietors maintain these inventory reports after their preparation. In some instances when the inventory report is prepared, a letter must be submitted to Customs certifying that the report has been prepared. As amended, the port director is the Customs officer to whom certification letters must be submitted and to whom the annual report covering smelting or refining operations must be submitted. These changes and other changes made by this document are intended to simplify inventory recordkeeping procedures for warehouse proprietors. The changes are consistent with Customs' movement toward a post-audit environment and the spirit of ``shared responsibility'' embodied in the Customs Modernization provisions of the North American Free Trade Agreement Implementation Act.

EFFECTIVE DATE: November 26, 1999.

FOR FURTHER INFORMATION CONTACT: Edward Bowles, Senior Auditor, Regulatory Audit Division, (202-927-0071).

SUPPLEMENTARY INFORMATION:

Background

By a document published in the Federal Register (64 FR 16868) on April 7, 1999, Customs proposed several amendments to part 19, Customs Regulations (19 CFR part 19), concerning the submission to Customs of certain inventory reports covering merchandise in a bonded warehouse. Instead of requiring that certain reports be filedwith Customs, the document proposed to amend the Customs Regulations to require that bonded warehouse proprietors maintain these inventory reports after their preparation. In certain instances, when the inventory report is prepared, a letter must be submitted to Customs certifying that the report has been prepared. Under the proposed amendment, the port director would be the Customs officer to whom certification letters would be submitted and to whom the annual report covering smelting or refining operations would be submitted. These proposed changes and other changes contained in the proposed rule were intended to simplify inventory recordkeeping procedures for warehouse proprietors and are consistent with Customs' movement toward a post-audit environment and the spirit of ``shared responsibility'' embodied in the Customs Modernization provisions of the North American Free Trade Agreement Implementation Act (Pub. L. 103-182).

Adoption of Proposal

No comments were received from the public in response to the proposed rule. Following further consideration and review of the matter, Customs has determined that the proposed rule published in the Federal Register (64 FR 16868) on April 7, 1999, should be adopted as a final rule without change.

The Regulatory Flexibility Act and Executive Order 12866

The amendments are intended to simplify inventory recordkeeping procedures for warehouse proprietors and be consistent with Customs' movement toward a post-audit environment and the spirit of ``shared responsibility'' embodied in the Customs Modernization provisions of the North American Free Trade Agreement Implementation Act. As such, pursuant to the provisions of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.), it is certified that the amendments will not have a significant economic impact on a substantial number of small entities. Accordingly, they are not subject to the regulatory analysis or other requirements of 5 U.S.C. 603 and 604. Nor do the amendments result in a ``significant regulatory action'' under E.O. 12866.

Paperwork Reduction Act

The collections of information contained in this 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 the following OMB control numbers: 1515-0093 for bonded warehouse proprietor's submissions; 1515-0121 for information to be supplied by owners or lessees in support of applications to establish a bonded warehouse facility; 1515-0127 for applications by manufacturers to bond (or discontinue a previously bonded) an establishment engaged in the smelting or refining of metal-bearing materials; and 1515-0135 for records of smelting or refining operations showing receipt and disposition of each

[[Page 57565]]

shipment of material. This document restates the collections of information without substantive change.

An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a valid control number assigned by OMB.

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, NW., 3rd Floor, Washington, DC 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, NW., Washington, DC 20229.

List of Subjects in 19 CFR Part 19

Customs duties and inspection, Exports, Freight, Imports, Reporting and recordkeeping requirements, Warehouses.

Amendments to the Regulations

Part 19, Customs Regulations (19 CFR part 19), is amended as set forth below.

PART 19--CUSTOMS WAREHOUSES, CONTAINER STATIONS, AND CONTROL OF MERCHANDISE THEREIN

1. The general authority citation for part 19, and the relevant sectional authority citation, continue to read as follows:

   Authority: 5 U.S.C. 301; 19 U.S.C. 66, 1202 (General Note 20, Harmonized Tariff Schedule of the United States), 1624. * * * * *

   Sections 19.17-19.25 also issued under 19 U.S.C. 1312; * * * * *

2. Section 19.12 is amended by revising the seventh and eighth sentences of paragraph (d)(3), by revising the first sentence of paragraph (g), adding a sentence thereafter, and revising the last sentence of paragraph (g), and by revising the first sentence, respectively, of paragraphs (h)(1) and (h)(3), to read as follows:

   Sec. 19.12 Inventory control and recordkeeping system.

   * * * * *

   (d) Accountability for merchandise in a warehouse. * * *

   (3) Theft, shortage, overage or damage. * * * The proprietor must also record all shortages and overages as required in the Customs Form 300 or annual reconciliation report under paragraphs (g) or (h) of this section, as appropriate. Duties and taxes applicable to any non- extraordinary shortage or damage and not required to be paid earlier must be reported and submitted to the port director no later than the date the certification of preparation of Customs Form 300 is due or at the time the certification of preparation of the annual reconciliation report is due, as prescribed in paragraphs (g) or (h) of this section. * * * * * * * *

   (g) Warehouse proprietor submission. Except as otherwise provided in paragraph (h) of this section or Sec. 19.19(b) of this part, the warehouse proprietor must prepare a Warehouse Proprietor's Submission on Customs Form (CF) 300 within 45 calendar days from the end of the business year and maintain the Submission on file for 5 years from the end of the business year covered by the Submission. The proprietor must submit to the port director, within 10 business days after preparation of the CF 300, a letter signed by the proprietor certifying that the CF 300 has been prepared, is available for Customs review, and is accurate. * * * An alternative format may be used for providing the information required on the CF 300.

   (h) Annual reconciliation. * * *

   (1) Report. Instead of preparing Customs Form 300 as required under paragraph (g) of this section, the proprietor of a class 2, importers' private bonded warehouse, and proprietors of classes 4, 5, 6, 7, 8, and 9 warehouses if the warehouse proprietor and the importer are the same party, must prepare a reconciliation report within 90 days after the end of the fiscal year unless the port director authorizes an extension for reasonable cause. * * * * * * * *

   (3) Certification. The proprietor must submit to the port director within 10 business days after preparation of the annual reconciliation report, a letter signed by the proprietor certifying that the annual reconciliation has been prepared, is available for Customs review, and is accurate. * * * * * * * *

3. Section 19.17 is amended by revising the first and second sentences of paragraph (g) to read as follows:

   Sec. 19.17 Application to establish warehouse; bond.

   * * * * *

   (g) Statement of inventory and bond charges. Where two or more smelting or refining warehouses are included under one blanket smelting and refining bond, an overall statement must be prepared and maintained by the principal named in the bond by the 28th of each month, showing the inventory as of the close of the preceding month, of all metals on hand at each plant covered by the blanket bond and the total of bonded charges for all plants. If the warehouses covered by an overall statement are located in more than one port, each port director may choose to verify the accuracy of the inventory report only with respect to that portion of the report that relates to amounts held at a plant that is located within that port director's jurisdiction. * * *

4. Section 19.19 is amended by revising the first sentence of paragraph (b) to read as follows:

   Sec. 19.19 Manufacturers' records; annual statement.

   * * * * *

   (b) Every manufacturer engaged in smelting or refining, or both, must prepare and submit to the port director at the port nearest which the plant is located an annual statement for the fiscal year for the plant involved not later than 60 days after the termination of that fiscal year. * * * Raymond W. Kelly, Commissioner of Customs.

   Approved: September 15, 1999. John P. Simpson, Deputy Assistant Secretary of the Treasury.

   [FR Doc. 99-27965Filed10-25-99; 8:45 am]

   BILLING CODE 4820-02-P