[Code of Federal Regulations] [Title 15, Volume 2] [Revised as of January 1, 2004] From the U.S. Government Printing Office via GPO Access [CITE: 15CFR303.2] [Page 21-23] TITLE 15--COMMERCE AND FOREIGN TRADE CHAPTER III--INTERNATIONAL TRADE ADMINISTRATION, DEPARTMENT OF COMMERCE PART 303_WATCHES, WATCH MOVEMENTS AND JEWELRY PROGRAM--Table of Contents Subpart A_Watches and Watch Movements Sec. 303.2 Definitions and forms. (a) Definitions. Unless the context indicates otherwise: (1) Act means Pub. L. 97-446, enacted January 12, 1983 (19 U.S.C. 1202), 96 Stat. 2329, as amended by Pub. L. 103-465, enacted on December 8, 1994, 108 Stat. 4991. (2) Secretaries means the Secretary of Commerce and the Secretary of Interior or their delegates, acting jointly. (3) Director means the Director of the Statutory Import Programs Staff, International Trade Administration, U.S. Department of Commerce. (4) Sale or tranfer of a business means the sale or transfer of control, whether temporary or permanent, over a firm to which a duty- exemption has been allocated, to any other firm, corporation, partnership, person or other legal entity by any means whatsoever, including, but not limited to, merger and transfer of stock, assets or voting trusts. (5) New firm is a watch firm not affiliated through ownership or control with any other watch duty-refund recipient. In assessing whether persons or parties are affiliated, the Secretaries will consider the following factors, among others: stock ownership; corporate or family groupings; franchise or joint venture agreements; debt financing; and close supplier relationships. The Secretaries may not find that control exists on the basis of these factors unless the relationship has the potential to affect decisions concerning production, pricing, or cost. Also, no watch duty-refund recipient may own or control more than one jewelry duty-refund recipient. A new entrant is a new watch firm which has received an allocation. (6) Producer means a duty-exemption holder which has maintained its eligibility for further allocations by complying with these regulations. (7) Established industry means all producers, including new entrants, that have maintained their eligibility for further allocations. (8) Territories, territorial, and insular possessions refer to the insular possessions of the United States (i.e., the U.S. Virgin Islands, Guam, and American Samoa) and the Northern Mariana Islands. (9) Duty-exemption refers to the authorization of duty-free entry of a specified number of watches and watch movements into the Customs Territory of the United States. (10) Total annual duty-exemption refers to the entire quantity of watches or watch components which may enter duty-free into the customs territory of the United States from the territories under 91/5 in a calendar year, as determined by the Secretaries or by the International Trade Commission in accordance with the Act. (11) Territorial distribution refers to the apportionment by the Secretaries of the total annual duty-exemption among the separate territories; territorial share means the portion consigned to each territory by this apportionment. (12) Allocation refers to the distribution of all parts of a territorial share, or a portion thereof, among the several producers in a territory. (13) Creditable wages means all wages, up to an amount equal to 65% of the contribution and benefit base for Social Security as defined in the Social Security Act for the year in which the wages were earned, paid to permanent residents of the territories employed in a firm's 91/5 watch and watch movement assembly operations, plus wages paid for the repair of non-91/5 watches up to an amount equal to 50% of the firm's total creditable wages, and for wages paid for the complete assembly of watches in the insular possession, with the exception of the movement, only in situations where the desired movement can not be purchased in an unassembled condition. Excluded, however, are wages paid to any outside consultants or other professional personnel, such as lawyers and accountants, or to those persons not involved in the day-to-day assembly operations or servicing and maintenance of equipment and fixtures necessary for the assembly or manufacturing operations or [[Page 22]] administrative work and security activities directly related to the operations of the company, such as gardeners or construction workers, and for the repair of non-91/5 watches and movements to the extent that such wages exceed the foregoing percentage. Wages paid to persons engaged in both creditable and non-creditable assembly and repair activities may be credited proportionately provided the firm maintains production and payroll records adequate for the Departments' verification of the creditable portion. (14) Non-91/5 watches and watch movements include, but are not limited to, watches and movements which are liquidated as dutiable by the Bureau of Customs and Border Protection but do not include, for purposes of the duty refund, watches that are completely assembled in the insular possessions, with the exception of a desired movement if the movement cannot be purchased in an unassembled condition; contains any material which is the product of any country with respect to which Column 2 rates of duty apply; are ineligible for duty-free treatment pursuant to law or regulation; or are units the assembly of which the Departments have determined not to involve substantial and meaningful work in the territories (as elsewhere defined in these regulations). (15) Discrete movements and components means screws, parts, components and subassemblies not assembled together with another part, component or subassembly at the time of importation into the territory. (A mainplate containing set jewels or shock devices, together with other parts, would be considered a single discrete component, as would a barrel bridge subassembly.) (16) Permanent resident means a person with one residence which is in the insular possessions or a person with one or more residences outside the insular possessions who meets criteria that include maintaining his or her domicile in the insular possessions, residing (i.e., be physically present for at least 183 days per year) and working in the territory at a program company, and maintaining his or her primary office for day-to-day work in the insular possessions. (b) Forms--(1) ITA-334P ``Application for License to Enter Watches and Watch Movements into the Customs Territory of the United States.'' This form must be completed annually by all producers desiring to receive an annual allocation. It is also used, with appropriate special instructions for its completion, by new firms applying for duty- exemptions and by producers who wish to receive the duty refund in installments on a biannual basis. (2) ITA-333 ``License to Enter Watches and Watch Movements into the Customs Territory of the United States.'' This form is issued by the Director to producers who have received an allocation and constitutes authorization for issuing specific shipment permits by the territorial governments. It is also used to record the balance of a producer's remaining duty-exemptions after each shipment permit is issued. (3) ITA-340 ``Permit to Enter Watches and Watch Movements into the Customs Territory of the United States.'' This form may be obtained, by producers holding a valid license, from the territorial government or may be produced by the licensee in an approved computerized format or any other medium or format approved by the Departments of Commerce and the Interior. The completed form authorizes duty-free entry of a specified amount of watches or watch movements at a specified U.S. Customs port. (4) ITA-360P ``Certificate of Entitlement to Secure the Refund of Duties on Watches and Watch Movements.'' This document authorizes an insular producer to request the refund of duties on imports of watches, watch movements and parts therefor, with certain exceptions, up to a specified value. Certificates may be used to obtain duty refunds only when presented with a properly executed Form ITA-361P. (5) ITA-361P ``Request for Refund of Duties on Watches and Watch Movements.'' This form must be completed to obtain the refund of duties authorized by the Director through Form ITA-360P. After authentication by the Department of Commerce, it may be used for the refund of duties on items which were entered into the customs territory of the United States during a [[Page 23]] specified time period. Copies of the appropriate Customs entries must be provided with this form to establish a basis for issuing the claimed amounts. The forms may also be used to transfer all or part of the producer's entitlement to another party. (See Sec. 303.12.) (The information collection requirements in paragraph (b)(1) were approved by the Office of Management and Budget under control number 0625-0040. The information collection requirements in paragraphs (b)[hairsp](4) through (6) were approved under control number 0625-0134) [49 FR 17740, Apr. 25, 1984, as amended at 50 FR 43568, Oct. 28, 1985; 53 FR 52994, Dec. 30, 1988; 56 FR 9621, Mar. 7, 1991; 61 FR 55884, 55885, Oct. 30, 1996; 65 FR 8049, Feb. 17, 2000; 66 FR 34812, July 2, 2001; 67 FR 77408, Dec. 18, 2002; 68 FR 56555, Oct. 1, 2003]