Procedures To Grant Relief From the Quantitative Limitation Applicable to Certain Steel Articles for Brazil for Parties With Preexisting Contracts That Meet Specified Criteria
| Published date | 13 October 2020 |
| Citation | 85 FR 64377 |
| Record Number | 2020-22608 |
| Section | Rules and Regulations |
| Court | Industry And Security Bureau |
Federal Register, Volume 85 Issue 198 (Tuesday, October 13, 2020)
[Federal Register Volume 85, Number 198 (Tuesday, October 13, 2020)]
[Rules and Regulations]
[Pages 64377-64383]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-22608]
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DEPARTMENT OF COMMERCE
Bureau of Industry and Security
15 CFR Part 705
[Docket No. 201006-0266]
RIN 0694-AI26
Procedures To Grant Relief From the Quantitative Limitation
Applicable to Certain Steel Articles for Brazil for Parties With
Preexisting Contracts That Meet Specified Criteria
AGENCY: Bureau of Industry and Security, U.S. Department of Commerce.
ACTION: Temporary final rule.
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SUMMARY: This temporary final rule establishes procedures to grant
relief from the quantitative limitation applicable to certain steel
articles for Brazil for parties with preexisting contracts that meet
specified criteria as authorized by the President as part of the action
he took to adjust imports under Section 232 of the Trade Expansion Act
of 1962, as amended (``section 232'').
DATES: Effective date: This temporary final rule is effective October
13, 2020, through December 31, 2020.
[[Page 64378]]
See SUPPLEMENTARY INFORMATION section for information on submitting
certifications for relief from the quantitative limitation for Brazil
for steel articles.
ADDRESSES: All certifications for relief from the quantitative
limitation for Brazil for steel articles on this temporary final rule
must be submitted through the email: [email protected].
FOR FURTHER INFORMATION CONTACT: For questions regarding this temporary
final rule, contact Erika Maynard at 202-482-5572 or via email
[email protected], or to [email protected].
SUPPLEMENTARY INFORMATION:
Background
On August 28, 2020, President Trump issued Proclamation 10064 (85
FR 54877), Adjusting Imports of Steel Into the United States, which
lowered one of the section 232 quantitative limitations applicable to
Brazil for the remainder of 2020 and added a new basis for relief from
those lowered quantitative limitations. The President determined that
the modification to the quantitative limitations applicable to certain
steel products was necessary to preserve the effectiveness of the
alternative means to address the threatened impairment of national
security posed by steel article imports which were previously agreed to
with Brazil. This temporary final rule implements the President's
directive to the Secretary of Commerce (Secretary) to grant relief from
the modified quantitative limitations in a limited aggregate amount
under specific circumstances related to the fulfillment of existing
contracts.
Background on Quantitative Limitations Applicable to Brazil
On January 11, 2018, the Secretary transmitted to President Trump a
report on his investigation into the effect of imports of steel mill
articles (steel articles) on the national security of the United States
under section 232 of the Trade Expansion Act of 1962, as amended (19
U.S.C. 1862). The Secretary found and advised President Trump that
steel articles were being imported into the United States in such
quantities and under such circumstances as to threaten to impair the
national security of the United States.
In Proclamation 9705 of March 8, 2018 (Adjusting Imports of Steel
Into the United States) (83 FR 11625), President Trump concurred in the
Secretary's finding that certain steel articles were being imported
into the United States in such quantities and under such circumstances
as to threaten to impair the national security of the United States,
and decided to adjust the imports of these steel articles by imposing a
25 percent ad valorem tariff on such articles imported from most
countries.
In Proclamation 9705, President Trump further stated that any
country with which the United States has a security relationship is
welcome to discuss with the United States alternative ways to address
the threatened impairment of the national security caused by imports
from that country. The President noted that, should the United States
and any such country arrive at a satisfactory alternative means to
address the threat to the national security such that he determines
that imports from that country no longer threaten to impair the
national security, the President may remove or modify the restriction
on steel article imports from that country.
Alternative Means To Address the Threatened Impairment to U.S. National
Security Posed by Steel Articles Imported From Brazil
In Proclamation 9759 of May 31, 2018 (Adjusting Imports of Steel
Into the United States) (85 FR 25857), President Trump noted that the
United States had agreed on measures with Brazil that would provide
effective, long-term alternative means to address Brazil's contribution
to the threatened impairment to our national security. These included
quantitative limitations that restrict the volume of steel articles
imported into the United States from Brazil. In light of these agreed-
upon measures, President Trump determined that steel article imports
from Brazil would no longer threaten to impair the national security
and decided to exclude Brazil from the tariff proclaimed in
Proclamation 9705, as amended.
Monitoring Implementation of Quantitative Limitations
In Proclamation 9759, President Trump also noted that the United
States would monitor the implementation and effectiveness of the
quantitative limitations applicable to steel article imports from
Brazil, and directed the Secretary to inform him of any circumstance
that in the Secretary's opinion might indicate that an adjustment of
the quantitative limitation is necessary.
The Secretary has advised President Trump that there have been
significant changes in the United States steel market since the
President decided to exclude Brazil, on a long-term basis, from the
tariff proclaimed in Proclamation 9705, as amended. The United States
steel market has contracted in 2020. After increasing in 2018 and 2019,
steel shipments by domestic producers through June of this year were
approximately 15 percent lower than shipments for the same time period
in 2019, with shipments in April and May of this year more than 30
percent lower than the shipments in the same months in 2019. The
Secretary has further advised President Trump that domestic producers'
adjusted year-to-date capacity utilization rate through August 15, 2020
is below 70 percent and that the rate has been near or below 60 percent
since the second week of April. Brazil is the second largest source of
steel imports to the United States and the largest source of imports of
semi-finished steel products. Moreover, while imports from most
countries have declined this year in a manner commensurate with this
contraction, imports from Brazil have decreased only slightly.
Actions Taken To Address Significant Changes in the United States Steel
Market
In light of these significantly changed market conditions,
President Trump determined in Proclamation 10064 that absent
modifications, the alternative measures applicable to Brazilian steel
imports would be ineffective in eliminating the threat to the national
security posed by imports of such articles in the current environment.
The United States and Brazil have held consultations regarding Brazil's
steel exports to the United States in light of the changed market
conditions. As a result of these discussions, the United States will
lower, for the remainder of 2020, one of the quantitative limitations
set forth in Proclamation 9759 applicable to steel articles imported
from Brazil.
In President Trump's judgment, this modification will preserve the
effectiveness of the alternative means to address the threatened
impairment to U.S. national security by further restraining steel
article exports to the United States from Brazil during the current
period of market contraction. In light of these modifications,
President Trump has determined that steel article imports from Brazil
will not threaten to impair the national security and thus has decided
to continue to exclude Brazil from the tariff proclaimed in
Proclamation 9705, as amended. The United States and Brazil will hold
further consultations in December 2020 to discuss the state of the
steel trade
[[Page 64379]]
between the two countries in light of then-prevailing market
conditions.
Ensuring That Lowered Quantitative Limitations for Brazil Do Not Delay
or Disrupt Specific Production Activities in the United States Already
Contracted for Delivery
President Trump in Proclamation 10064 noted that he has been
informed that a reduction in the quantitative limitation set forth in
Proclamation 9759 applicable to certain steel article imports from
Brazil may delay or disrupt specific production activities in the
United States for which imports of the steel articles covered by the
quantitative limitations have already been contracted for delivery in
the fourth quarter of this year. In light of these circumstances, and
after considering the impact on the economy and the national security
objectives of section 232, President Trump in Proclamation 10064
determined to direct the Secretary to provide relief from the modified
quantitative limitations in certain limited circumstances specified in
more detail below and in paragraph (j) of this rule. This relief is in
addition to the relief from the quantitative limitations that the
Secretary is already authorized to provide pursuant to clause 1 of
Proclamation 9777 of August 29, 2018 (Adjusting Imports of Steel Into
the United States) (83 FR 45025). However, exclusion requests submitted
under paragraph (j) involve different criteria and procedures than
those submitted under existing paragraph (c) and determined pursuant to
the criteria and procedures described in existing paragraphs (a)-(i).
In addition, the Secretary may not, prior to January 1, 2021, grant
relief under paragraph (c) for steel articles for which relief is
granted under paragraph (j).
Proclamation 10064 sets forth several directives that are being
implemented in this rule. Clause 1 of Proclamation 10064 specifies that
the quantitative limitation applicable to imports of steel articles
classified under subheading 9903.80.57 of subchapter III of chapter 99
of the HTSUS from Brazil are being lowered for the remainder of
calendar year 2020, and specifies that the new quantitative limitation
is described in the Annex to the proclamation. For calendar year 2021
and for subsequent years, the annual aggregate limit for steel articles
classified under this subheading from Brazil reverts to the annual
aggregate limit for Brazil set forth in the Annex to Proclamation 9759,
unless that limit is further modified or terminated by President Trump.
Under clause 2 of Proclamation 10064, President Trump directed that
the Secretary shall, on an expedited basis, grant relief from the
modified quantitative limitation now applicable to subheading
9903.80.57 of subchapter III of chapter 99 of the HTSUS for Brazil for
any steel article where:
(i) The party requesting relief entered into a contract or other
written agreement for the production and shipment of such steel article
before August 28, 2020;
(ii) such agreement specifies the quantity of such steel article
that is to be produced and shipped to the United States prior to
December 31, 2020;
(iii) such steel article is to be used in production activities in
the United States and such steel article cannot be procured from
another supplier to meet the delivery schedule and specifications
contained in such agreement; and
(iv) lack of relief from the quantitative limitation on such steel
article would significantly disrupt the production activity in the
United States for which the steel article specified in such agreement
is intended.
Also under clauses 2 and 5, President Trump specified that the
volume of imports for which the Secretary grants relief under this
clause shall not exceed 60,000,000 kilograms in the aggregate, and
under clauses 1 and 5 that any steel article for which relief is
granted must be entered for consumption or withdrawn from warehouse for
consumption on or before December 31, 2020. Also under clause 5,
President Trump further provided that the Secretary may not, prior to
January 1, 2021, grant further relief for such an article through the
preexisting exclusion request process (set out in paragraphs (a)-(i) of
this supplement) applicable to items not available in the United States
in sufficient or reasonably available quantity or of satisfactory
quality or based on specific national security considerations, as
provided for by clause 1 of Proclamation 9777.
Under clause 3 of Proclamation 10064, President Trump directed that
the Secretary shall grant relief under clause 2 of this proclamation
only upon receipt of a sworn statement signed by the chief executive
officer and the chief legal officer of the party requesting relief,
attesting that:
(i) The steel article for which relief is sought and the associated
contract or other written agreement meet the criteria for relief set
forth in clause 2(i) through (iv) of Proclamation 10064;
(ii) the party requesting relief will accurately report to U.S.
Customs and Border Protection (CBP), in the manner that CBP prescribes,
the quantity of steel articles entered for consumption, or withdrawn
from warehouse for consumption, pursuant to any grant of relief; and
(iii) the quantity of steel articles entered pursuant to a grant of
relief will not exceed the quantity for which the Secretary has granted
relief.
Clause 3 of Proclamation 10064 also specified that the Secretary
shall notify CBP of any grant of relief made pursuant to Proclamation
10064. Clause 3 further provided that the Secretary shall revoke any
grant of relief under clause 2 of the proclamation if the Secretary
determines at any time after such grant that the criteria for relief
have not been met and may, if the Secretary deems it appropriate,
notify the Attorney General of the facts that led to such revocation.
Under clause 4 of Proclamation 10064, President Trump directed that
as soon as practicable, the Secretary shall issue procedures for the
requests for relief described in clauses 2 and 3 of the proclamation,
which BIS is doing on behalf of the Secretary with the publication of
this temporary final rule. Lastly, clause 4 specified that CBP shall
implement relief provided under clause 2 of this proclamation as soon
as practicable.
Under clause 5 of Proclamation 10064, until the modified
quantitative limitation provided under subheading 9903.80.57 of
subchapter III of chapter 99 of the HTSUS from Brazil has been reached,
CBP will count steel articles granted relief under clause 2 of
Proclamation 10064 toward that modified quantitative limitation when
the steel article is entered for consumption or withdrawn from
warehouse for consumption. (Clause 5 also provides that steel articles
for which relief is granted pursuant to clause 2 of Proclamation 10064
shall be subject to the duty treatment provided in subheading
9903.80.62 of subchapter III of chapter 99 of the HTSUS for Brazil, as
established by the Annex to Proclamation 10064).
Changes Made in This Temporary Final Rule
In Supplement No. 1 to Part 705--Requirements for Submissions
Requesting Exclusions from the Remedies Instituted in Presidential
Proclamation 9705 of March 8, 2018 Adjusting Imports of Steel Articles
into the United States, under new paragraph (j) (Certification for
requesting relief from quantitative limitation for Brazil), this
temporary final rule makes the following changes:
In Note to paragraph (c)(2), this temporary final rule adds one
sentence to the end of this note to provide a cross
[[Page 64380]]
reference to new paragraph (j) which is added by this rule. The Note to
paragraph (c)(2) provides guidance to directly affected individuals or
organizations located in the United States seeking exclusions from
quantitative limitations imposed on certain countries. The new sentence
that this rule adds to the note specifies that directly affected
individuals or organizations located in the United States and importing
steel articles from Brazil, a country subject to quantitative
limitations, should first review new paragraph (j) prior to submitting
any exclusion requests.
This temporary final rule adds new paragraph (j) to describe the
requirements to request relief from the quantitative limitations
applicable to steel article imports from Brazil under the new process
created by clause 2 of Proclamation 10064. The introductory text of
paragraph (j) provides background on the quantitative limitations for
steel articles for Brazil. This introductory text references
Proclamation 9759 on May 31, 2018 and the most recent Proclamation
10064 of August 28, 2020. The introductory text explains that paragraph
(j) provides a process for relief separate from the section 232
exclusions process as required by Proclamation 10064. Under this
process a party may request relief from the quantitative limitation for
certain steel articles from Brazil, which will be approved by the
Department of Commerce (the ``Department'') under stated criteria.
Paragraph (j) describes the requirements for a party to obtain this
relief, how the Department reviews these requests for relief, the
administration and use of granted requests of relief, and when
revocation of grants of relief may occur. These procedures are all
contained in paragraph (j), which unless extended on or before December
31, 2020, will be removed from the regulations on January 1, 2021. This
process of requesting grants for relief from the quantitative
limitations for Brazil is a separate process from the 232 exclusions
process described elsewhere in supplement no. 1 to part 705.
New paragraph (j) consists of five paragraphs: (j)(1) (Sworn
statement required to grant relief); (j)(2) (Where to submit requests
for grants of relief?); (j)(3) (Disposition of requests for grants of
relief); (j)(4) (Administration and use of granted requests of relief);
and (j)(5) (Revocation of grants of relief).
New paragraph (j)(1) specifies that pursuant to clause 3 of
Proclamation 10064, the Secretary will grant relief from the lowered
quantitative limitation for steel articles under subheading 9903.80.57
of subchapter III of chapter 99 of the HTSUS for Brazil only upon
receipt of a sworn statement signed by the chief executive officer and
the chief legal officer of the party requesting relief. The sworn
statement made under new paragraph (j)(1) must attest to the criteria
specified in paragraphs (j)(1)(i) to (iii). These criteria are required
in order to determine whether the steel article for which relief is
sought and the associated contract or other written agreement meet the
criteria for relief set forth in clause 2(i) through (iv) of
Proclamation 10064.
The party requesting relief must certify under paragraph
(j)(1)(i)(A) that they entered into a contract or other written
agreement for the production and shipment of such steel article before
August 28, 2020. The party requesting relief must also include in the
certification a description of the steel article by HTS classification
and Chapter 99 quota category HTS classification. The certification
must also specify under paragraph (j)(1)(i)(B) that the associated
contract or other written agreement states the quantity of such steel
article that is to be produced and shipped to the United States prior
to December 31, 2020. The party requesting relief must certify under
paragraph (j)(1)(i)(C) that such steel article is to be used in
production activities in the United States. This includes certifying
that such steel article cannot be procured from another supplier to
meet the delivery schedule and specifications contained in such
agreement. Lastly, under the certification requirement under paragraph
(j)(1)(i)(D), the party requesting relief must certify that lack of
relief from the quantitative limitation on such steel article would
significantly disrupt the production activity in the United States for
which the steel article specified in such agreement is intended.
Requesters are required to comply with the certification
requirement under paragraph (j)(1)(ii) in order to ensure that if
approved, the relief provided can be properly administered and enforced
by CBP. Specifically, the party requesting relief must accurately
report to CBP, in the manner that CBP prescribes, the quantity of steel
articles entered for consumption, or withdrawn from warehouse for
consumption, pursuant to any grant of relief. The last requirement of
the certification under paragraph (j)(1)(iii) is to acknowledge that
the requester will not, in entering steel articles pursuant to any
grant of relief, exceed the quantity for which the Secretary grants
relief.
Under new paragraph (j)(2), this temporary final rule specifies
where to submit requests for grants of relief. This paragraph specifies
that all requests for grants of relief pursuant to paragraph (j) must
be in electronic form and submitted by email to [email protected]. This paragraph specifies that in order to submit a
request for a grant of relief under paragraph (j), the request must be
submitted as an attachment to the email sent to [email protected]. Paragraph (j)(2) specifies the only information
required to be submitted for these requests is the sworn statement
under paragraph (j)(1).
New paragraph (j)(3) describes how the Department will dispose of
requests for grants of relief. Paragraph (j)(3) specifies that the
Department will grant requests for relief that meet the criteria
specified in paragraphs (j)(1) and (2) until such time as the maximum
quantity under this relief program is met. Paragraph (j)(3) specifies
that pursuant to Proclamation 10064, the volume of imports for which
the Secretary grants relief under this paragraph shall not exceed
60,000,000 kilograms in the aggregate. The Department will use a
``first submitted, first approved'' process until such time as the
maximum aggregate limit has been approved and will not accept
submissions after this limit is reached.
This rule also adds a Note to paragraph (j)(3) to provide guidance
on when the Department will deny a requested grant for relief. This
note specifies that denials will occur if the sworn statement does not
meet the requirements specified in paragraphs (j)(1) and (2). It also
specifies that requests for relief will be denied to the extent
granting the request would result in the aggregate amount of imports
for which relief is granted under paragraph (j) exceeding 60,000,000
kilograms. This note also clarifies that once the aggregate amount of
approved grants for relief reaches 60,000,000 kilograms, the Department
will post a statement on the BIS website under www.bis.doc.gov/232-steel-Brazil to alert requesters that the aggregate limit has been
reached, so that they are informed that they may no longer submit
requests for grants of relief. This statement will save time for
requesters, as well as the Department.
This temporary final rule adds new paragraph (j)(4) to specify how
granted requests for relief will be administered and the validity
periods for these granted requests for relief. Any relief granted under
paragraph (j) will only be valid if the subject steel article is
entered for consumption, or withdrawn from warehouse for consumption,
on or before December 31, 2020. Paragraph
[[Page 64381]]
(j)(4) also specifies that further relief may not be granted for such
article by the Secretary under clause 1 of Proclamation 9777.
This temporary final rule adds new paragraph (j)(5) to specify when
the Secretary may revoke grants of relief made pursuant to paragraph
(j). Paragraph (j)(5) specifies that the Secretary will revoke any such
grant of relief if the Secretary determines at any time after relief is
granted that the criteria for relief have not been met. Paragraph (j)
also specifies that if the Secretary deems it appropriate, he may
notify the Attorney General of the facts that led to such revocation.
Rulemaking Requirements
1. Executive Orders 13563 and 12866 direct agencies to assess all
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. This rule has been determined to be a ``significant
regulatory action,'' although not economically significant, under
section 3(f) of Executive Order 12866. Pursuant to clause 4 of
Proclamation 10064 of August 28, 2020, this rule is exempt from
Executive Order 13771 (85 FR 54877, September 2, 2020).
2. The Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.)
(PRA) provides that an agency generally cannot conduct or sponsor a
collection of information, and no person is required to respond to nor
be subject to a penalty for failure to comply with a collection of
information, unless that collection has obtained Office of Management
and Budget (OMB) approval and displays a currently valid OMB Control
Number.
This temporary final regulation involves one collection currently
approved by OMB with the following control number: Procedures for
Submitting Requests for Expedited Relief from Quantitative Limits--
Existing Contract: Section 232 National Security Investigations of
Steel Imports (OMB control number 0694-0140).
BIS is making a change to this collection for OMB control number
0694-0140 to account for the certification in the form of a sworn
statement that needs to be made and submitted to the Department by
requesters via email to [email protected] under Supplement No. 1
to 15 CFR part 705, paragraphs (j)(1) and (2), when requesting relief
from the quantitative limitation applicable to Brazil for certain steel
articles. Any comments regarding the collection of information
associated with this rule, including suggestions for reducing the
burden, may be sent to Jasmeet K. Seehra, Office of Management and
Budget (OMB), by email to [email protected], or online at
https://www.reginfo.gov/public/do/PRAMain.
3. This rule does not contain policies with Federalism implications
as that term is defined in Executive Order 13132.
4. The provisions of the Administrative Procedure Act (5 U.S.C.
553) requiring notice of proposed rulemaking, the opportunity for
public comment, and a delay in effective date are inapplicable because
this regulation involves a military or foreign affairs function of the
United States. (See 5 U.S.C. 553(a)(1)). The reduction in the
quantitative limitation for certain steel articles from Brazil is
needed to protect U.S. national security interests in light of recent
deterioration in the U.S. steel industry that was being further harmed
by steel imports from Brazil, as described further below. This needed
measure to protect U.S. national security could also result in adverse
impacts on certain parties in the United States that import steel
articles from Brazil, so this rule creates a process to allow those
parties to request relief that meet specified criteria. Creating this
process to allow parties to request relief is needed to ensure that the
required actions needed to protect U.S. national security can be taken
without doing unintended harm to other parts of the U.S. economy and
national security.
As explained in the report submitted by the Secretary to the
President on January 11, 2018, steel is being imported into the United
States in such quantities or under such circumstances as to threaten to
impair the national security of the United States and therefore the
President has implemented these remedial adjustments of imports (as
described in in Proclamation 9705 of March 8, 2018, as amended) to
protect U.S. national security interests.
In Proclamation 9759, President Trump directed the Secretary to
monitor implementation of quantitative limitations applicable to steel
article imports from Brazil and inform him of any circumstance that in
the Secretary's opinion might indicate that an adjustment of the
quantitative limitation is necessary. The Secretary has advised
President Trump that there have been significant changes in the United
States steel market since the time President Trump decided to exclude,
on a long-term basis, Brazil from the tariff proclaimed in Proclamation
9705.
The United States steel market has contracted in 2020. After
increasing in 2018 and 2019, steel shipments by domestic producers
through June of this year are approximately 15 percent lower than
shipments for the same time period in 2019, with shipments in April and
May of this year more than 30 percent lower than the shipments in the
same months in 2019. The Secretary has further advised President Trump
that domestic producers' adjusted year-to-date capacity utilization
rate through August 15, 2020 is below 70 percent and that the current
rate has been near or below 60 percent since the second week of April.
Brazil is also the second largest source of steel imports to the United
States and the largest source of imports of semi-finished steel
products. Moreover, imports from most countries have declined this year
in a manner commensurate with this contraction, whereas imports from
Brazil have decreased only slightly.
In light of these significantly changed market conditions,
President Trump determined in Proclamation 10064 that the alternative
measures regarding Brazilian steel imports, without any modifications,
would be ineffective in eliminating the threat to the national security
posed by imports of such articles in the current environment. The
United States and Brazil have held consultations regarding Brazil's
steel exports to the United States. As a result of these discussions,
the United States will lower, for the remainder of 2020, one of the
quantitative limitations set forth in Proclamation 9759 applicable to
steel articles imported from Brazil. In President Trump's judgment,
this modification will preserve the effectiveness of the alternative
means to address the threatened impairment to U.S. national security by
further restraining steel article exports to the United States from
Brazil during this period of market contraction. In light of this
modification, President Trump has determined that steel article imports
from Brazil will not threaten to impair the national security and thus
has decided to continue to exclude Brazil from the tariff proclaimed in
Proclamation 9705, as amended.
President Trump in Proclamation 10064 noted that he has been
informed that a reduction in this quantitative limitation set forth in
Proclamation 9759 applicable to steel article imports from Brazil may
delay or disrupt specific production activities in the
[[Page 64382]]
United States for which imports of steel articles covered by the
quantitative limitation have already been contracted for delivery in
the fourth quarter of this year. In light of these circumstances, and
after considering the impact on the economy and the national security
objectives of section 232, President Trump directed the Secretary in
Proclamation 10064 to provide relief from the modified quantitative
limitations in certain limited circumstances specified in paragraph (j)
of this rule.
The implementation of the President's directive includes the
creation of a process by which domestic parties can submit a
certification requesting relief from this modified quantitative
limitation for Brazil. Establishing these procedures in this temporary
final rule are needed to ensure that the reduction in this quantitative
limitation for Brazil can occur as needed to protect U.S. national
security interests while not causing unintended economic harm for those
affected parties in the U.S. with existing contracts that meet the
specified criteria in this rule.
In addition, the Department finds that there is good cause under 5
U.S.C. 553(b)(B) to waive the provisions of the Administrative
Procedure Act requiring prior notice and the opportunity for public
comment and under 5 U.S.C. 553(d)(1) and (d)(3) to waive the delay in
effective date because this rule is a substantive rule which grants or
recognizes an exemption and such delays would be either impracticable
or contrary to the public interest.
Under clause 4 of Proclamation 10064, President Trump directed that
as soon as practicable, the Secretary shall issue procedures for the
requests for relief described in clauses 2 and 3 of this proclamation,
which BIS is doing on behalf of the Secretary with the publication of
this temporary final rule. Clause 4 also specified that CBP shall
implement relief provided under clause 2 of this proclamation as soon
as practicable, which is also contingent on the publication of this
temporary final rule. If this rule was delayed for public comment,
those impacted parties that are intended to benefit from this relief
would not be allowed to benefit from this exemption and may not be able
to import steel articles from Brazil when above the reduced
quantitative limitations.
The provisions of new paragraph (j) are of a temporary nature. As
directed by President Trump, any steel article for which relief is
granted under clause 2 of Proclamation 10064 must be entered for
consumption, or withdrawn from warehouse for consumption, on or before
December 31, 2020. Because of the immediate need for these provisions
and the short term during which these provisions will be effective
(i.e., from October 13, 2020 through December 31, 2020), it would be
impractical to allow for public comments or a delay in effective date
because by the time the changes became effective the public would have
very little time to benefit from these changes.
Because a notice of proposed rulemaking and an opportunity for
prior public comment are not required for this rule by 5 U.S.C. 553, or
by any other law, the analytical requirements of the Regulatory
Flexibility Act, 5 U.S.C. 601 et seq., are not applicable. Accordingly,
no regulatory flexibility analysis is required and none has been
prepared.
List of Subjects in 15 CFR Part 705
Administrative practice and procedure, Business and industry,
Classified information, Confidential business information, Imports,
Investigations, National security.
For the reasons set forth in the preamble, part 705 of subchapter A
of 15 CFR chapter VII is amended as follows:
PART 705--[AMENDED]
0
1. The authority citation for part 705 continues to read as follows:
Authority: Section 232 of the Trade Expansion Act of 1962, as
amended (19 U.S.C. 1862) and Reorg. Plan No. 3 of 1979 (44 FR 69273,
December 3, 1979).
0
2. Supplement No. 1 to part 705 is amended:
0
a. By revising the heading;
0
b. By adding one sentence to the end of Note to Paragraph (c)(2); and
0
c. By adding paragraph (j).
The additions and revision read as follows:
Supplement No. 1 to Part 705--Requirements for Submissions Requesting
Exclusions From the Remedies Instituted in Presidential Proclamations
Adjusting Imports of Steel Articles Into the United States
* * * * *
(c) * * *
(2) * * *
Note to paragraph (c)(2): * * * Parties intending to request an
exclusion from quantitative limitations applicable to imports of
items classified under subheading 9903.80.57 of subchapter III of
chapter 99 of the HTSUS for Brazil should consult paragraph (j) of
this supplement prior to submitting an exclusion request.
* * * * *
(j) Certification for requesting relief from quantitative
limitation for Brazil. Brazil is a country subject to quantitative
limitations for steel articles. Pursuant to Proclamation 10064 of
August 28, 2020, the United States will lower, for the remainder of
2020, one of the quantitative limitations set forth in Proclamation
9759 of May 31, 2018 (Adjusting Imports of Steel Into the United
States) applicable to certain steel articles imported from Brazil in
order to protect U.S. national security interests. President Trump in
Proclamation 10064 noted that he has been informed that a reduction in
this quantitative limitation set forth in Proclamation 9759 applicable
to steel article imports from Brazil may delay or disrupt specific
production activities in the United States for which imports of steel
articles covered by this quantitative limitation have already been
contracted for delivery in the fourth quarter of 2020. In light of
these circumstances, and after considering the impact on the economy
and the national security objectives of section 232 of the Trade
Expansion Act of 1962, as amended, President Trump in Proclamation
10064 directed the Secretary to provide relief from this modified
quantitative limitation in certain limited circumstances that are
specified in Proclamation 10064 and repeated in this paragraph (j).
This authority is in addition to the relief from the quantitative
limitations that the Secretary is already authorized to provide
pursuant to clause 1 of Proclamation 9777 of August 29, 2018 (Adjusting
Imports of Steel Into the United States), and involves different
exclusion criteria and procedures. This paragraph (j) describes what
must be done to obtain this relief, how the U.S. Department of Commerce
reviews these requests for relief, the administration and use of
granted requests of relief, and when revocation of grants of relief may
occur.
(1) Sworn statement required to grant relief. The Secretary will
grant relief from the modified quantitative limitation applicable to
imports of steel articles classified under subheading 9903.80.57 of
subchapter III of chapter 99 of the HTSUS from Brazil only upon receipt
of a sworn statement signed by the chief executive officer and the
chief legal officer of the party requesting relief, attesting to the
following criteria:
(i) The steel article for which relief is sought, (insert
description here of the steel article by HTS classification and Chapter
99 quota category HTS classification), and the associated contract or
other written agreement meet the criteria for relief set forth in
clause 2(i) through (iv) of Proclamation 10064, described here under
paragraphs
[[Page 64383]]
(j)(1)(i)(A) through (D) of this supplement:
(A) The party requesting relief entered into a contract or other
written agreement for the production and shipment of such steel article
before August 28, 2020;
(B) Such agreement specifies the quantity of such steel article
that is to be produced and shipped to the United States prior to
December 31, 2020;
(C) Such steel article is to be used in production activities in
the United States and such steel article cannot be procured from
another supplier to meet the delivery schedule and specifications
contained in such agreement; and
(D) Lack of relief from the quantitative limitation on such steel
article would significantly disrupt the production activity in the
United States for which the steel article specified in such agreement
is intended;
(ii) The party requesting relief will accurately report to U.S.
Customs and Border Protection (CBP), in the manner that CBP prescribes,
the quantity of steel articles entered for consumption, or withdrawn
from warehouse for consumption, pursuant to any grant of relief; and
(iii) The quantity of steel articles entered pursuant to a grant of
relief will not exceed the quantity for which the Secretary has granted
relief.
(2) Where to submit requests for grants of relief? All exclusion
requests for grants of relief pursuant to this paragraph (j) must be in
electronic form and submitted to BIS by email: [email protected]. In order to submit a request for a grant of relief,
you must submit your request for a grant of relief as an attachment to
the email sent to [email protected]. The only documentation
required for a request for a grant of relief is the sworn statement
required under paragraph (j)(1) of this supplement. There are no
objection, rebuttal, or surrebuttal submissions or review periods, and
no provisions of the exclusion request process specified in this
supplement apply except those provided in this paragraph (j).
(3) Disposition of requests for grants of relief. The U.S.
Department of Commerce will grant requests for relief that meet the
criteria specified in paragraphs (j)(1) and (2) of this supplement
until such time as the maximum quantity under this relief program is
met, and will post granted requests publicly on the BIS website as
described below. In Proclamation 10064 under clause 2, President Trump
specified that the volume of imports for which the Secretary grants
relief under this clause shall not exceed 60,000,000 kilograms in the
aggregate and this paragraph (j)(3) imposes this same limitation. The
Department will use a ``first submitted, first approved'' process until
such time as the maximum aggregate limit has been approved and will not
accept submissions after this limit is reached. The Secretary will
notify CBP of any grant of relief made pursuant to this proclamation.
Note to paragraph (j)(3): Denials will occur if the sworn
statement does not meet all of the requirements specified in
paragraphs (j)(1) and (2) of this supplement, or will be denied to
the extent the amount of imports for which the Secretary has granted
relief under this paragraph (j)(3) would exceed 60,000,000 kilograms
in the aggregate. Once the aggregate amount of approved grants for
relief reaches 60,000,000 kilograms, the U.S. Department of Commerce
will post a statement on the BIS website under www.bis.doc.gov/232-steel-Brazil to alert other requesters that the aggregate limit has
been reached, and no more requests will be approved.
(4) Administration and use of granted requests of relief. Any
relief granted under paragraph (j)(3) of this supplement will only be
valid if the subject steel article is entered for consumption, or
withdrawn from warehouse for consumption, on or before December 31,
2020. Where a party has received relief under the provisions of this
paragraph (j), they are not eligible for further relief under clause 1
of Proclamation 9777 prior to January 1, 2021, for the same steel
article pursuant to an exclusion request submitted under paragraph (c)
of this supplement.
(5) Revocation of grants of relief. The Secretary of Commerce will
revoke any grant of relief under paragraph (j)(3) of this supplement if
the Secretary determines at any time after such grant that the criteria
for relief to which the party must attest under paragraphs (j)(1)(i)
through (iii) of this supplement have not been met and may, if the
Secretary deems it appropriate, notify the Attorney General of the
facts that led to such revocation.
Matthew S. Borman,
Deputy Assistant Secretary for Export Administration.
[FR Doc. 2020-22608 Filed 10-8-20; 11:15 am]
BILLING CODE 3510-33-P
