[Federal Register: June 30, 2006 (Volume 71, Number 126)]
[Notices]
[Page 37596-37598]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr30jn06-93]
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DEPARTMENT OF HOMELAND SECURITY
Bureau of Customs and Border Protection
Modification of the CBP NCAP Test Regarding Reconciliation for
Entries Under the Dominican Republic-Central America-United States Free
Trade Agreement
AGENCY: Customs and Border Protection, Homeland Security.
ACTION: General notice.
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SUMMARY: This document announces a modification to the Customs and
Border Protection Automated Commercial
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System (ACS) Reconciliation prototype test that adds to the issues
subject to the Reconciliation process those arising under the Dominican
Republic-Central America-United States Free Trade Agreement. Other than
this modification, the test remains the same as set forth in previously
published Federal Register notices.
DATES: The test modification set forth in this document is effective on
September 28, 2006. The two-year testing period of this Reconciliation
prototype commenced on October 1, 1998, and was extended indefinitely
starting October 1, 2000. Applications to participate in the test will
be accepted throughout the duration of the test.
ADDRESSES: Written inquiries regarding participation in the
Reconciliation prototype test and/or applications to participate should
be addressed to Ms. Monica Crockett, Reconciliation Team, Bureau of
Customs and Border Protection, 1300 Pennsylvania Ave., NW., Room 5.2A,
Washington, DC 20229-0001. Answers to inquiries regarding the test are
also available at Recon.Help@dhs.gov.
FOR FURTHER INFORMATION CONTACT: Ms. Monica Crockett at (202) 344-2511.
SUPPLEMENTARY INFORMATION:
Background
Reconciliation, a planned component of the National Customs
Automation Program (NCAP), as provided for in Title VI (Subtitle B) of
the North American Free Trade Agreement Implementation Act (the NAFTA
Implementation Act; Public Law 103-182, 107 Stat. 2057 (December 8,
1993)), is currently being tested by the Bureau of Customs and Border
Protection (CBP) under the CBP Automated Commercial System (ACS)
Prototype Test. CBP announced and explained the test in a general
notice document published in the Federal Register (63 FR 6257) on
February 6, 1998. Clarifications and operational changes were announced
in subsequent Federal Register notices: 63 FR 44303, published on
August 18, 1998; 64 FR 39187, published on July 21, 1999; 64 FR 73121,
published on December 29, 1999; 66 FR 14619, published on March 13,
2001; 67 FR 61200, published on September 27, 2002 (with a correction
document published at 67 FR 68238 on November 8, 2002); 69 FR 53730,
published on September 2, 2004; 70 FR 1730, published on January 10,
2005; and 70 FR 46882, published on August 11, 2005. A Federal Register
(65 FR 55326) notice published on September 13, 2000, extended the
prototype indefinitely. This document announces a modification to the
Reconciliation test to expand the issues subject to Reconciliation to
include those arising under the Dominican Republic-Central America-
United States Free Trade Agreement. Aside from this modification, the
test remains as set forth in the previously published Federal Register
notices.
For application requirements, see the Federal Register notices
published on February 6, 1998, and August 18, 1998. Additional
information regarding the test can be found at http://www.customs.gov/xp/cgov/import/cargo_summary/reconciliation/
.
Reconciliation Generally
Reconciliation is the process that allows an importer, at the time
an entry summary is filed, to identify undeterminable information
(other than that affecting admissibility) to CBP and to provide that
outstanding information at a later date. The importer identifies the
outstanding information by means of an electronic ``flag'' which is
placed on the entry summary at the time the entry summary is filed and
payment (applicable duty, taxes, and fees) is made. Previously
published Federal Register documents have set forth that the issues for
which an entry summary may be ``flagged'' (for the purpose of later
reconciliation) are limited and relate to: (1) Value issues other than
claims based on latent manufacturing defects; (2) classification
issues, on a limited basis; (3) issues concerning value aspects of
entries filed under heading 9802, Harmonized Tariff Schedule of the
United States (HTSUS) (9802 issues); and (4) issues concerning
merchandise entered under the North American Free Trade Agreement
(NAFTA issues/claims) and under the United States-Chile Free Trade
Agreement (CFTA or Chile issues/claims) that are eligible for treatment
under 19 U.S.C. 1520(d).
The flagged entry summary (the underlying entry summary) is
liquidated for all aspects of the entry except those issues that were
flagged. The means of providing the outstanding information at a later
date relative to the flagged issues is through the filing of a
Reconciliation entry. The flagged issues will be liquidated at the time
the Reconciliation entry is liquidated. Any adjustments in duties,
taxes, and/or fees owed will be made at that time. (See the February 6,
1998, Federal Register notice for a more detailed presentation of the
basic Reconciliation process.)
CBP reminds test participants that the filing of a Reconciliation
entry, like the filing of a regular consumption entry, is governed by
19 U.S.C. 1484 and can be done only by the importer of record as
defined in that statute.
Test Modification
The Agreement and the Implementation Act
The Dominican Republic-Central America-United States Free Trade
Agreement (CAFTA-DR or the Agreement) was entered into by the
governments of Costa Rica, the Dominican Republic, El Salvador,
Guatemala, Honduras, Nicaragua, and the United States on August 5,
2004. The United States Congress approved the CAFTA-DR in the Dominican
Republic-Central America-United States Free Trade Agreement
Implementation Act (the Implementation Act), Public Law 109-53, 119
Stat. 462 (19 U.S.C. 4001 et seq.). Under the Implementation Act, the
provisions of the CAFTA-DR become effective for individual CAFTA-DR
countries (defined under the Implementation Act to include all
countries that are signatory to the Agreement except the United States)
only when the Agreement enters into force for a CAFTA-DR country upon
issuance of a presidential proclamation to that effect, an action that
is conditioned upon the fulfillment of certain requirements (i.e., the
CAFTA-DR country has taken measures to comply with the provisions of
the Agreement). Importations of originating goods of such a CAFTA-DR
country are entitled to the benefits of the Agreement as of the
effective date set forth in the presidential proclamation and in
accordance with the Implementation Act and new General Note 29 of the
Harmonized Tariff Schedule of the United States (HTS).
As of the date of this notice, the Agreement has entered into force
for three CAFTA-DR countries: El Salvador, in accordance with
Presidential Proclamation 7987, issued on February 28, 2006 (71 FR
10827; March 2, 2006) (see also U.S. International Trade Commission
(USITC) Publication 3829, February 2006), and Honduras and Nicaragua,
in accordance with Presidential Proclamation 7996, issued on March 31,
2006 (71 FR 16971; April 4, 2006) (see also USITC Publication 3845,
April 2006).
Ordinary CAFTA-DR Claim and Post-Importation CAFTA-DR Claim Under 19
U.S.C. 1520(d)
A claim for preferential tariff treatment for an originating CAFTA-
DR good, in accordance with CAFTA-DR and applicable procedures
(regulations are forthcoming), is made at the time of
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entry summary. (See General Note 29, HTSUS, for rules of origin.)
However, in some instances, an importer may not be able to make the
claim at that time, usually because the importer does not possess all
the information or documentation required. In those instances, an
importer may make a post-importation CAFTA-DR claim under 19 U.S.C.
1520(d) (section 1520(d)), pursuant to an amendment to that section
made by the Implementation Act (section 207). Under this amendment to
section 1520(d), entries of goods qualifying under CAFTA-DR rules of
origin are eligible for reliquidation when preferential tariff
treatment under CAFTA-DR is not claimed at the time of importation,
notwithstanding that a protest under 19 U.S.C. 1514 (section 1514) is
not timely filed. (A section 1514 protest is a means of objecting to,
among other things, the liquidation of an entry by filing the protest
within 180 days of the liquidation (or other protestable decision or
action by CBP).) A claimant must file a claim under section 1520(d)
within one year of the applicable importation and meet other
requirements, such as applicable documentary requirements, including
(when requested by CBP) the filing of a certification or information
demonstrating that the entered goods are originating CAFTA-DR goods.
Post-Importation CAFTA-DR Claim Under Reconciliation
This notice announces that a post-importation claim for
preferential tariff treatment under section 1520(d) for an entry filed
pursuant to the CAFTA-DR also may be made under the Reconciliation
test, in the same way as a post-importation NAFTA or Chile claim may be
made (see, respectively, notices published in the Federal Register on
September 27, 2002, and September 2, 2004, cited previously). This
alternative requires that an importer follow the Reconciliation test
procedure which, in contrast to the ordinary section 1520(d) procedure
described above, requires action at the time of entry. That action is
to flag the entry summary for the CAFTA-DR issue(s), which will be
followed later by the filing of a Reconciliation entry within one year
of the applicable importation. It is noted that CAFTA-DR Reconciliation
entries cannot include other Reconciliation-eligible issues; i.e., a
CAFTA-DR Reconciliation entry is limited to covering only CAFTA-DR
issues (claims). NAFTA and Chile Reconciliation entries/claims are
similarly limited.
This CAFTA-DR Reconciliation alternative is available for eligible
importations involving any eligible CAFTA-DR country (a CAFTA-DR
country as to which the Agreement has entered into force) 90 days after
the date this notice is published in the Federal Register.
Reconciliation CAFTA-DR Claim Precludes Claims by Other Means
CBP emphasizes that once an importer flags an entry summary for
CAFTA-DR issues for Reconciliation, indicating that it is pursuing the
post-importation, section 1520(d) claim through the Reconciliation
process, the only means of perfecting the CAFTA-DR claim is by
completing the Reconciliation process by filing a timely Reconciliation
entry. (See the September 27, 2002, Federal Register notice for an
explanation of this same limitation relative to NAFTA and Chile
issues.) By flagging the entry summary, the importer makes a commitment
to perfect the claim only through the Reconciliation process--to, in
effect, waive filing the claim any other way. Thus, once entries have
been flagged for Reconciliation of CAFTA-DR issues, CBP will not accept
a claim filed for those entries under the ordinary section 1520(d)
procedure. This will prevent dual filings for the same underlying entry
summaries.
Benefits of Reconciliation
Finally, CBP recommends the use of the Reconciliation test
procedure for making post-importation CAFTA-DR claims because the test
procedure provides the importer with several benefits. First, using the
test procedure is a simpler means of filing claims: i.e., the importer
is able to make potentially thousands of CAFTA-DR claims on one
Reconciliation entry. Second, the importer can receive one check from
CBP rather than many (even up to thousands) upon CBP's liquidation of a
Reconciliation entry and issuance of a refund. Third, because
processing CAFTA-DR claims under Reconciliation is simpler for CBP, the
refund delivery system is more efficient.
Dated: June 23, 2006.
William S. Heffelfinger III,
Acting Assistant Commissioner, Office of Field Operations.
[FR Doc. 06-5875 Filed 6-29-06; 8:45 am]
BILLING CODE 9111-14-P