[Federal Register: April 17, 2008 (Volume 73, Number 75)]
[Rules and Regulations]
[Page 20782-20785]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr17ap08-6]
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DEPARTMENT OF HOMELAND SECURITY
U.S. Customs and Border Protection
DEPARTMENT OF THE TREASURY
19 CFR Parts 12, 113 and 163
[CBP Dec. 08-10; USCBP-2006-0108]
RIN 1505-AB73
Entry of Softwood Lumber Products From Canada
AGENCIES: U.S. Customs and Border Protection, Department of Homeland
Security; Department of the Treasury.
ACTION: Final rule.
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SUMMARY: This document adopts as a final rule, with changes, the
interim rule amending title 19 of the Code of Federal Regulations (19
CFR) that was published in the Federal Register (71 FR 61399) on
October 18, 2006 as Customs and Border Protection (CBP) Dec. 06-25. The
interim rule amended the CBP regulations by prescribing the collection
of certain entry summary information for purposes of monitoring and
enforcing the Softwood Lumber Agreement (SLA 2006) between the
Governments of Canada and the United States, entered into on September
12, 2006. In an effort to better enable CBP to accurately and timely
fulfill its data collection and reporting obligations
[[Page 20783]]
under the SLA 2006, this document identifies an additional entry code
option that designates softwood lumber products that are specifically
identified as exempt from SLA 2006 export measures pursuant to Annex 1A
of the Agreement, notwithstanding the fact that the exempt goods are
classifiable in residual Harmonized Tariff Schedule of the United
States provisions that are listed as covered by the SLA 2006. This
document also amends the list of required entry records set forth in
the Appendix to part 163 of title 19 of the Code of Federal Regulations
(19 CFR part 163) to reflect the recordkeeping requirements prescribed
in CBP Dec. 06-25. Lastly, this document conforms the bond provisions
applicable to certain imports of Canadian softwood lumber to reflect
the softwood lumber provisions set forth in Sec. 12.140 of title 19 of
the Code of Federal Regulations.
DATES: Effective Date: April 17, 2008.
FOR FURTHER INFORMATION CONTACT: Millie Gleason, Office of
International Trade, Tel: (202) 863-6557.
SUPPLEMENTARY INFORMATION:
Background
On September 12, 2006, the Governments of the United States and
Canada (the ``Parties'') signed a bilateral Softwood Lumber Agreement
(``SLA 2006'') concerning trade in softwood lumber products.
On October 18, 2006, Customs and Border Protection (CBP) published
in the Federal Register (71 FR 61399), as CBP Dec. 06-25, an interim
rule amending Sec. 12.140 of title 19 of the Code of Federal
Regulations (19 CFR 12.140) to reflect the terms of the SLA 2006 by
prescribing special entry requirements applicable to shipments of
softwood lumber products from Canada. The interim amendments required
importers to enter a letter code representing the softwood lumber
product's Canadian Region of Origin in the data entry field entitled
``Country of Origin'' located on the CBP Form 7501. Importers were also
required to enter a Canadian-issued 8-digit export permit number
preceded by a letter code designating either: (1) The date of shipment;
(2) a Canadian Region whose exports of softwood lumber products are
exempt from the export measures contained in the SLA 2006; or (3) a
company listed in Annex 10 of the SLA 2006 as exempt from the
Agreement's export measures. Importers of softwood lumber products from
the Maritimes were required to provide CBP with the original paper
Certificate of Origin issued by the Maritime Lumber Bureau with the
paper entry summary documentation. CBP Dec. 06-25 also amended, on an
interim basis, the ``List of Records Required for the Entry of
Merchandise'' set forth in the Appendix to part 163 of title 19 of the
CFR (19 CFR part 163) to reflect the entry document requirements
mandated by the SLA 2006.
Comments were solicited on the interim rule.
Discussion of Comments
Three comments were received in response to the solicitation of
comments in CBP Dec. 06-25. One comment was retracted by the commenter.
A description of the comments received, together with CBP's analyses,
is set forth below.
Comment: One commenter offered support for the requirement set
forth in CBP Dec. 06-25 that an original Certificate of Origin from the
Maritime Lumber Bureau must accompany each entry of softwood lumber
into the United States and requested that this requirement be retained
in the final rule.
CBP Response: This entry requirement is retained in the final rule.
Comment: One commenter suggested that CBP adopt two additional
data-input requirements for imports of Canadian softwood lumber
products. The commenter recommended that CBP require importers to
disclose the ``Export Price'' of the merchandise within the meaning of
Article XXI.25 of the SLA 2006. As defined in the agreement, the Export
Price is the taxable value for purposes of calculating SLA 2006 export
fees that Canada is obligated to collect. The commenter also suggests
that CBP require importers of all Canadian softwood lumber products to
declare the merchandise's ``Date of Shipment'' within the meaning of
Article XXI.16 of the SLA 2006. The commenter asserts that this date is
important because, depending on volumes shipped during specific periods
(as determined by Date of Shipment), shipments from the Maritimes, the
Territories, or by companies listed as excluded from export measures in
the SLA 2006, can be subject to export measures notwithstanding
normally applicable exemptions. The commenter notes that, under the
terms of the interim rule, CBP is collecting Date of Shipment data
regarding imports of most Canadian softwood lumber, but not on lumber
produced in the Maritime Provinces, the Territories, or by excluded
Canadian lumber producers.
CBP Response: Pursuant to Article XV.B of the SLA 2006, the U.S. is
obligated to provide Canada with the appraised value, as defined by
CBP, for each entry of softwood lumber products filed during the
preceding month. The U.S. does not collect export prices; exporters of
softwood lumber to the U.S provide that data to Canada.
The commenter correctly notes that CBP collects Date of Shipment
data for all imports of softwood lumber covered by the SLA 2006, except
for entries of softwood lumber that claim an exemption from the
Agreement's export measures. Although CBP does not require Date of
Shipment data for imports claiming exemption from SLA 2006 export
measures, CBP collects the export date for these imports and uses that
date to assess the Date of Shipment and, consequently, whether an
exempt status remains valid for a given month.
Other Comments: Additional comments were received after the close
of the comment period proposing unilateral enforcement of the Softwood
Lumber Agreement and the collection of additional information in order
to determine if the correct amount of tax is actually collected by
Canadian authorities.
CBP Response: Such proposals exceed the scope of CBP authority and
the requirements of the Softwood Lumber Agreement and consequently are
not adopted in this document.
Conclusion
After review of the comments and further consideration, CBP has
decided to adopt as final the interim rule published in the Federal
Register (71 FR 61399) on October 18, 2006, as CBP Dec. 06-25, with the
additional modifications set forth below.
As noted above, CBP Dec. 06-25 identifies a series of letter codes
that are to be used as prefixes for the export permit numbers entered
on the CBP Form 7501. These codes designate either an exclusion from
export measures based on a product's Region of Origin, or a company's
exempt-status, or the date of shipment as defined in Article XXI.16 of
the SLA 2006. These codes enable the United States to fulfill its
information collection and exchange obligations under Article XV of the
Agreement by being able to assess monthly volumes attributable to
specific Regions and excluded companies. This document clarifies CBP
Dec. 06-25 by providing importers with an additional entry code option,
``P88888888'', which is used to designate entries of softwood lumber
products that are specifically identified as exempt from SLA 2006
export measures pursuant to Annex 1A of the Agreement, notwithstanding
the fact that the exempt goods are classifiable in residual Harmonized
[[Page 20784]]
Tariff Schedule of the United States provisions that are otherwise
listed as covered by the SLA 2006.
In addition, Sec. 12.140(b) and (c) are amended to clarify that
all entries of softwood lumber products must be submitted to CBP in an
electronic format, except for entries of softwood lumber products whose
region of origin is the Maritimes, which must be submitted to CBP in
paper.
The ``List of Records Required for the Entry of Merchandise'' set
forth in the Appendix to part 163 of title 19 of the CFR (19 CFR part
163) is also amended by this document to clarify that, in addition to
the Certificate of Origin issued by Canada's Maritime Lumber Bureau,
the Canadian-issued Export Permit is a required entry document as per
the SLA 2006 and 19 CFR 12.140(d).
Lastly, this document conforms the bond provisions applicable to
certain imports of Canadian softwood lumber, set forth in 19 CFR
113.62(k), to reflect the new organizational structure of the softwood
lumber provisions set forth in 19 CFR 12.140. To that end, Sec.
113.62(k) is amended by removing the reference to paragraph (a) within
Sec. 12.140, and the existing time period of 20 days within which a
principal must establish to the satisfaction of CBP that the applicable
export permit has been issued by the Government of Canada is changed to
10 days to reflect the fact that, pursuant to the SLA 2006, the export
permit number must be submitted to CBP at the time of entry summary.
Inapplicability of Notice and Delayed Effective Date Requirements
Pursuant to 5 U.S.C. 553(a)(1), public notice and a delayed
effective date are inapplicable to this regulation because it involves
a foreign affairs function of the United States.
Executive Order 12866
Because this rule involves a foreign affairs function of the United
States, it is not subject to Executive Order 12866 and has not been
reviewed by the Office of Management and Budget.
Regulatory Flexibility Act
Because no notice of proposed rulemaking is required for this rule,
the provisions of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.)
do not apply.
Paperwork Reduction Act
The collection of information referenced in this regulation, CBP
Form 7501, has been previously reviewed and approved by the Office of
Management and Budget in accordance with the requirements of the
Paperwork Reduction Act (44 U.S.C. 3507) under OMB-assigned control
number 1651-0022.
Signing Authority
This document is being issued in accordance with 19 CFR 0.1(a)(1).
List of Subjects
19 CFR Part 12
Bonds, Customs duties and inspection, Entry of merchandise,
Imports, Prohibited merchandise, Reporting and recordkeeping
requirements, Restricted merchandise.
19 CFR Part 113
Bonds, Customs duties and inspection, Imports, Reporting and
recordkeeping requirements, Surety bonds.
19 CFR Part 163
Customs duties and inspection, Reporting and recordkeeping
requirements.
Amendment to the Regulations
0
For the reasons stated above, parts 12, 113 and 163 of title 19 of the
Code of Federal Regulations are amended as set forth below.
PART 12--SPECIAL CLASSES OF MERCHANDISE
0
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 3(i),
Harmonized Tariff Schedule of the United States (HTSUS)), 1624;
* * * * *
0
2. Section 12.140 is revised to read as follows:
Sec. 12.140 Entry of softwood lumber products from Canada.
The requirements set forth in this section are applicable for as
long as the Softwood Lumber Agreement (SLA 2006), entered into on
September 12, 2006, by the Governments of the United States and Canada,
remains in effect.
(a) Definitions. The following definitions apply for purposes of
this section:
(1) British Columbia Coast. ``British Columbia Coast'' means the
Coastal Forest Regions as defined by the existing Forest Regions and
Districts Regulation, B.C. Reg. 123/2003.
(2) British Columbia Interior. ``British Columbia Interior'' means
the Northern Interior Forest Region and the Southern Interior Forest
Region as defined by the existing Forest Regions and Districts
Regulation, B.C. Reg. 123/2003.
(3) Date of shipment. ``Date of shipment'' means, in the case of
products exported by rail, the date when the railcar that contains the
products is assembled to form part of a train for export; otherwise,
the date when the products are loaded aboard a conveyance for export.
If a shipment is transshipped through a Canadian reload center or other
inventory location, the date of shipment is the date the merchandise
leaves the reload center or other inventory location for final shipment
to the United States.
(4) Maritimes. ``Maritimes'' means New Brunswick, Canada; Nova
Scotia, Canada; Prince Edward Island, Canada; and Newfoundland and
Labrador, Canada.
(5) Region. ``Region'' means British Columbia Coast or British
Columbia Interior as defined in paragraphs (a)(1) and (2) of this
section; Alberta, Canada; Manitoba, Canada; Maritimes, Canada;
Northwest Territories, Canada; Nunavut Territory, Canada; Ontario,
Canada; Saskatchewan, Canada; Quebec, Canada; or Yukon Territory,
Canada.
(6) Region of Origin. ``Region of Origin'' means the Region where
the facility at which the softwood lumber product was first produced
into such a product is located, regardless of whether that product was
further processed (for example, by planing or kiln drying) or was
transformed from one softwood lumber product into another such product
(for example, a remanufactured product) in another Region, with the
following exceptions:
(i) The Region of Origin of softwood lumber products first produced
in the Maritime Provinces from logs originating in a non-Maritime
Region will be the Region, as defined above, where the logs originated;
and
(ii) The Region of Origin of softwood lumber products first
produced in the Yukon, Northwest Territories or Nunavut (the
`Territories') from logs originating outside the Territories will be
the Region where the logs originated.
(7) SLA 2006. ``SLA 2006'' or ``SLA'' means the Softwood Lumber
Agreement entered into between the Governments of Canada and the United
States on September 12, 2006.
(8) Softwood lumber products. ``Softwood lumber products'' mean
those products described as covered by the SLA 2006 in Annex 1A of the
Agreement.
(b) Reporting requirements. In the case of softwood lumber products
from Canada listed in Annex 1A of the SLA 2006 as covered by the scope
of the Agreement, the following information must be included on the
electronic entry summary documentation (CBP Form 7501) for each entry
(except for entries of softwood lumber products whose
[[Page 20785]]
Region of Origin is the Maritimes, in which case entry summary
documentation must be submitted in paper as set forth in paragraph (c)
of this section):
(1) Region of Origin. The letter code representing a softwood
lumber product's Canadian Region of Origin, as posted on the
Administrative Message Board in the Automated Commercial System. (For
example, the letter code ``XD'' designates softwood lumber products
whose Region of Origin is British Columbia Coast. The letter code
``XE'' designates softwood lumber products whose Region of Origin is
British Columbia Interior.)
(2) Export Permit Number--(i) Export Permit Number issued by Canada
at time of filing entry summary documentation. The 8-digit Canadian-
issued Export Permit Number, preceded by one of the following letter
codes:
(A) The letter code assigned to represent the date of shipment
(i.e., ``A'' represents January, ``B'' represents February, ``C''
represents March, etc.), except for those softwood lumber products
produced by a company listed in Annex 10 of the SLA 2006 or whose
Region of Origin is the Maritimes, Yukon, Northwest Territories or
Nunavut;
(B) The letter code ``X'', which designates a company listed in
Annex 10 of the SLA 2006; or
(C) The letter code assigned to represent the Maritimes (code M);
Yukon (code Y); Northwest Territories (code W); or Nunavut (code N),
for softwood lumber products originating in these regions.
(ii) No Export Permit Number required due to softwood lumber
product's exempt status. Where an Export Permit Number is not required
because the imported softwood lumber product is specifically identified
as exempt from SLA 2006 export measures pursuant to Annex 1A of the
Agreement, notwithstanding the fact that the exempt goods are
classifiable in residual Harmonized Tariff Schedule of the United
States provisions otherwise listed as covered by the SLA 2006, the
alpha-numeric code ``P88888888'' must be used in the Export Permit
Number data entry field on the CBP Form 7501.
(c) Original Maritime Certificate of Origin. Where a softwood
lumber product's Region of Origin is the Maritimes, the original paper
copy of the Certificate of Origin issued by the Maritime Lumber Bureau
must be submitted to CBP and the entry summary documentation for each
such entry must be in paper and not electronic. The Certificate of
Origin must specifically state that the corresponding CBP entries are
for softwood lumber products first produced in the Maritimes from logs
originating in the Maritimes or State of Maine.
(d) Recordkeeping. Importers must retain copies of export permits,
certificates of origin, and any other substantiating documentation
issued by the Canadian Government pursuant to the recordkeeping
requirements set forth in part 163 of title 19 to the CFR.
PART 113--CUSTOMS BONDS
0
3. The general authority citation for part 113 continues to read as
follows:
Authority: 6 U.S.C. 101, et seq.; 19 U.S.C. 66, 1623, 1624.
* * * * *
Sec. 113.62 [Amended]
0
4. In Sec. 113.62, paragraph (k) is amended by:
0
a. Removing the term ``Sec. 12.140(a)'' and adding in its place the
term ``Sec. 12.140'';
0
b. Removing the number ``20'' and adding in its place the number
``10''; and
0
c. Removing the word ``Customs'' and adding in its place the term
``CBP''.
PART 163--RECORDKEEPING
0
5. The authority citation for part 163 continues to read as follows:
Authority: 5 U.S.C. 301; 19 U.S.C. 66, 1484, 1508, 1509, 1510,
1624.
0
6. The Appendix to part 163 is amended by removing the listing for
Sec. 12.140(c) and adding in its place Sec. 12.140(b) and (c) under
section IV to read as follows:
Appendix to Part 163--Interim (a)(1)(A) List
* * * * *
IV. * * *
Sec. 12.140(b) and (c) Canadian-issued Export Permit, Certificate of
Origin issued by Canada's Maritime Lumber Bureau.
* * * * *
W. Ralph Basham,
Commissioner, U.S. Customs and Border Protection.
Approved: April 10, 2008.
Timothy E. Skud,
Deputy Assistant Secretary of the Treasury.
[FR Doc. E8-8095 Filed 4-16-08; 8:45 am]
BILLING CODE 9111-14-P