[Code of Federal Regulations]
[Title 19, Volume 2]
[Revised as of April 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 19CFR177.12]

[Page 343-346]
 
                        TITLE 19--CUSTOMS DUTIES
 
  CHAPTER I--UNITED STATES CUSTOMS SERVICE, DEPARTMENT OF THE TREASURY
 
PART 177--ADMINISTRATIVE RULINGS--Table of Contents
 
                   Subpart A--General Ruling Procedure
 
Sec. 177.12  Modification or revocation of interpretive rulings, protest review decisions, and previous treatment of substantially identical transactions.

    (a) General. An interpretive ruling, which includes an internal 
advice decision, issued under this part, or a holding or principle 
covered by a protest review decision issued under part 174 of this 
chapter, if found to be in error or not in accord with the current views 
of Customs, may be modified or revoked by an interpretive ruling issued 
under this section. In addition, an interpretive ruling issued under 
this section may have the effect of modifying or revoking the treatment 
previously accorded by Customs to substantially identical transactions. 
A modification or revocation under this section must be carried out in 
accordance with the notice procedures set forth in paragraph (b) or 
paragraph (c) of this section except as otherwise provided in paragraph 
(d) of this section, and the modification or revocation will take effect 
as provided in paragraph (e) of this section.
    (b) Interpretive rulings or protest review decisions. Customs may 
modify or revoke an interpretive ruling or holding or principle covered 
by a protest review decision that has been in effect for less than 60 
calendar days by simply giving written notice of the modification or 
revocation to the person to whom the original ruling was issued or whose 
current transaction was the subject of the internal advice decision or, 
in the case of a protest review decision, to the person identified on 
the Customs Form 19 as the protestant or to any other person designated 
to receive notice of denial of a protest under Sec. 174.30(b) of this 
chapter. However, when Customs contemplates the issuance of an 
interpretive ruling that would modify or revoke an interpretive ruling 
or holding or principle covered by a protest review decision which has 
been in effect for 60 or more calendar days, the following procedures 
will apply:
    (1) Publication of proposed action. A notice proposing the 
modification or revocation and inviting public comment on the proposal 
will be published in the Customs Bulletin. The notice will refer to all 
previously issued interpretive rulings or protest review decisions that 
Customs has identified as being the subject of the proposed action and 
will invite any member of the public who has received another 
interpretive ruling or protest review decision involving the issue that 
is the subject of the proposed action to advise Customs of that fact. 
Interested parties will have 30 calendar days from the date of 
publication of the notice to submit written comments on the proposed 
modification or revocation and to advise Customs in writing that they 
are recipients of an affected interpretive ruling or protest review 
decision that was not identified in the notice.
    (2) Notice of final action. In the absence of extraordinary 
circumstances, within 30 calendar days after the close of the public 
comment period, any submitted comments will be considered

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and a final modifying or revoking notice or notice of other appropriate 
final action on the proposed modification or revocation will be 
published in the Customs Bulletin. In addition, a written decision will 
be issued to the person to whom, or on whose transaction, the original 
interpretive ruling was issued or, in the case of a protest review 
decision, to the person identified on the Customs Form 19 as the 
protestant or to any other person designated to receive notice of denial 
of a protest under Sec. 174.30(b) of this chapter. Publication of a 
final modifying or revoking notice in the Customs Bulletin will have the 
effect of modifying or revoking any interpretive ruling or holding or 
principle covered by a protest review decision that involves merchandise 
or an issue that is substantially identical in all material respects to 
the merchandise or issue that is the subject of the modification or 
revocation, including an interpretive ruling or holding or principle 
covered by a protest review decision that is not specifically identified 
in the final modifying or revoking notice.
    (c) Treatment previously accorded to substantially identical 
transactions--(1) General. The issuance of an interpretive ruling that 
has the effect of modifying or revoking the treatment previously 
accorded by Customs to substantially identical transactions must be in 
accordance with the procedures set forth in paragraph (c)(2) of this 
section. The following rules will apply for purposes of determining 
under this section whether a treatment was previously accorded by 
Customs to substantially identical transactions of a person:
    (i) There must be evidence to establish that:
    (A) There was an actual determination by a Customs officer regarding 
the facts and issues involved in the claimed treatment;
    (B) The Customs officer making the actual determination was 
responsible for the subject matter on which the determination was made; 
and
    (C) Over a 2-year period immediately preceding the claim of 
treatment, Customs consistently applied that determination on a national 
basis as reflected in liquidations of entries or reconciliations or 
other Customs actions with respect to all or substantially all of that 
person's Customs transactions involving materially identical facts and 
issues;
    (ii) The determination of whether the requisite treatment occurred 
will be made by Customs on a case-by-case basis and will involve an 
assessment of all relevant factors. In particular, Customs will focus on 
the past transactions to determine whether there was an examination of 
the merchandise (where applicable) by Customs or the extent to which 
those transactions were otherwise reviewed by Customs to determine the 
proper application of the Customs laws and regulations. For purposes of 
establishing whether the requisite treatment occurred, Customs will give 
diminished weight to transactions involving small quantities or values, 
and Customs will give no weight whatsoever to informal entries and to 
other entries or transactions which Customs, in the interest of 
commercial facilitation and accommodation, processes expeditiously and 
without examination or Customs officer review;
    (iii) Customs will not find that a treatment was accorded to a 
person's transactions if:
    (A) The person's own transactions were not accorded the treatment in 
question over the 2-year period immediately preceding the claim of 
treatment;
    (B) The issue in question involves the admissibility of merchandise;
    (C) The person made a material false statement or material omission 
in connection with a Customs transaction or in connection with the 
review of a Customs transaction and that statement or omission affected 
the determination on which the treatment claim is based; or
    (D) Customs advised the person regarding the manner in which the 
transactions should be presented to Customs and the person failed to 
follow that advice; and
    (iv) The evidentiary burden as regards the existence of the previous 
treatment is on the person claiming that treatment. The evidence of 
previous treatment by Customs must include a list of all materially 
identical transactions by entry number (or other

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Customs assigned number), the quantity and value of merchandise covered 
by each transaction (where applicable), the ports of entry, the dates of 
final action by Customs, and, if known, the name and location of the 
Customs officer who made the determination on which the claimed 
treatment is based. In addition, in cases in which an entry is 
liquidated without any Customs review (for example, the entry is 
liquidated automatically as entered), the person claiming a previous 
treatment must be prepared to submit to Customs written or other 
appropriate evidence of the earlier actual determination of a Customs 
officer that the person relied on in preparing the entry and that is 
consistent with the liquidation of the entry.
    (2) Notice procedures--(i) When Customs has reason to believe that a 
contemplated interpretive ruling would have the effect of modifying or 
revoking the treatment previously accorded by Customs to substantially 
identical transactions, notice of the intent to modify or revoke that 
treatment will be published in the Customs Bulletin either as a separate 
action or in connection with a proposed modification or revocation of an 
interpretive ruling or holding or principle covered by a protest review 
decision under paragraph (b)(1) of this section. The notice will give 
interested parties 30 calendar days from the date of publication of the 
notice to submit written comments on the proposed modification or 
revocation and will invite any member of the public whose substantially 
identical transactions have been accorded the same treatment to advise 
Customs in writing of that fact, supported by appropriate details 
regarding those transactions, within that 30-day period. Within 30 
calendar days after the close of the public comment period, any 
submitted comments will be considered, notice of the final interpretive 
ruling or other final action on the proposed modification or revocation 
will be published in the Customs Bulletin. Written confirmation of the 
applicability of a final modification or revocation will be sent to each 
person identified as having had substantially identical transactions 
that were accorded the same treatment.
    (ii) If Customs is not aware prior to issuance that a contemplated 
interpretive ruling would have the effect of modifying or revoking the 
treatment previously accorded by Customs to substantially identical 
transactions, the interpretive ruling will be issued and generally will 
be effective as provided in Sec. 177.9. However, Customs will, upon 
written application by a person claiming that the interpretive ruling 
has the effect of modifying or revoking the treatment previously 
accorded by Customs to his substantially identical transactions, 
consider delaying the effective date of the interpretive ruling with 
respect to that person, and continue the treatment previously accorded 
the substantially identical transactions, pending completion of the 
procedures set forth in paragraph (c)(2)(i) of this section.
    (d) Exceptions to notice requirements--(1) Publication and issuance 
not required. The publication and issuance requirements set forth in 
paragraphs (b) and (c) of this section are inapplicable in circumstances 
in which a Customs position is modified, revoked or otherwise materially 
affected by operation of law or by publication pursuant to other legal 
authority or by other appropriate action taken by Customs in furtherance 
of an order, instruction or other policy decision of another 
governmental agency or entity pursuant to statutory or delegated 
authority. Such circumstances include, but are not limited to, the 
following:
    (i) Adoption or amendment of a statutory provision, including any 
change to the Harmonized Tariff Schedule of the United States;
    (ii) Promulgation of a treaty or other international agreement under 
the foreign affairs function of the United States;
    (iii) Issuance of a Presidential Proclamation or Executive Order, or 
issuance of a decision or policy determination pursuant to authority 
delegated by the President;
    (iv) Subject to the provisions of Sec. 152.16 of this chapter, the 
rendering of a judicial decision which has the effect of overturning the 
Customs position;
    (v) Publication of a decision in the Federal Register as a result of 
a petition by a domestic interested party

[[Page 346]]

pursuant to 19 U.S.C. 1516 (see part 175 of this chapter);
    (vi) Publication of an interim or final rule in the Federal Register 
in accordance with 5 U.S.C. 553;
    (vii) Publication of a final interpretative rule in the Federal 
Register in accordance with 5 U.S.C. 553 following public notice and 
comment procedures; and
    (viii) Publication of a final ruling in the Federal Register in 
accordance with 19 U.S.C. 1315(d) and Sec. 177.10(c) relating to change 
of established and uniform practice.
    (2) Publication not required. In the following circumstances a final 
modifying or revoking ruling will be issued to the person entitled to it 
under paragraph (b) or (c) of this section but Customs Bulletin 
publication under paragraph (b) or (c) of this section is not required:
    (i) The modifying ruling corrects a clerical error; or
    (ii) The modifying or revoking ruling is directed to a ruling issued 
under subpart I of part 181 of this chapter relating to advance rulings 
under the North American Free Trade Agreement.
    (e) Effective date and application to transactions--(1) Rulings or 
decisions in effect for less than 60 days. If an interpretive ruling or 
holding or principle covered by a protest review decision that is 
modified or revoked under this section had been in effect for less than 
60 calendar days, the modifying or revoking interpretive ruling:
    (i) Will be effective on its date of issuance with respect to the 
specific transaction covered by the modifying or revoking interpretive 
ruling: and
    (ii) Will be applicable to merchandise entered, or withdrawn from 
warehouse for consumption, on and after its date of issuance.
    (2) Rulings or decisions in effect for 60 or more days. If an 
interpretive ruling or holding or principle covered by a protest review 
decision that is modified or revoked under this section had been in 
effect for 60 or more calendar days, the modifying or revoking notice 
will, provided that liquidation of the entry in question has not become 
final, apply to merchandise entered, or withdrawn from warehouse for 
consumption:
    (i) Sixty calendar days after the date of publication of the final 
modifying or revoking notice in the Customs Bulletin under paragraph 
(b)(2) of this section; or
    (ii) At the option of any person with regard to that person's 
transaction, on and after the date of publication of the final modifying 
or revoking notice in the Customs Bulletin under paragraph (b)(2) of 
this section.
    (3) Previous treatment accorded to substantially identical 
transactions. A final notice that modifies or revokes the treatment 
previously accorded by Customs to substantially identical transactions:
    (i) Will be effective with respect to transactions that are 
substantially identical to the transaction described in the modifying or 
revoking notice 60 calendar days after the date of publication of the 
final modifying or revoking notice in the Customs Bulletin under 
paragraph (b)(2) or paragraph (c)(2)(i) of this section; and
    (ii) Provided that liquidation of the entry in question has not 
become final, will apply to merchandise entered, or withdrawn from 
warehouse for consumption:
    (A) Sixty calendar days after the date of publication of the final 
modifying or revoking notice in the Customs Bulletin under paragraph 
(b)(2) or paragraph (c)(2)(i) of this section; or
    (B) At the option of a person who makes a valid claim regarding 
previous treatment, on and after the date of publication of the final 
modifying or revoking notice in the Customs Bulletin under paragraph 
(b)(2) or paragraph (c)(2)(i) of this section.

[T.D. 02-49, 67 FR 53497, Aug. 16, 2002; 67 FR 54733, Aug. 26, 2002]