[Code of Federal Regulations]

[Title 19, Volume 2]

[Revised as of April 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 19CFR146.82]



[Page 116-117]

 

                        TITLE 19--CUSTOMS DUTIES

 

   CHAPTER I--BUREAU OF CUSTOMS AND BORDER PROTECTION, DEPARTMENT OF 

        HOMELAND SECURITY; DEPARTMENT OF THE TREASURY (CONTINUED)

 

PART 146_FOREIGN TRADE ZONES--Table of Contents

 

               Subpart G_Penalties; Suspension; Revocation

 

Sec.  146.82  Suspension.



    (a) For cause. The port director may suspend for cause the activated 

status of a zone or zone site, or the privilege to admit, manufacture, 

manipulate, exhibit, destroy, transfer or remove merchandise at a zone 

or zone site for a period not to exceed 90 days. Upon order of the Board 

the suspension may be continued. If appropriate, the suspension may be 

limited to an individual user or users and not to the zone or zone site 

as a whole, or may be limited to a particular activity of an operator or 

user, such as suspension of the privilege to admit merchandise or the 

privilege to manufacture. An action to suspend will be taken in 

accordance with the procedure in paragraph (b) of this section if:

    (1) The approval of the application to activate the zone was 

obtained through fraud or the misstatement of a material fact;

    (2) The operator neglects or refuses to obey any proper order of a 

Customs officer or any Customs order, rule, or regulation relating to 

the operation or administration of a zone;

    (3) The operator, or any officer of a corporation which has been 

granted the right to operate a zone, is convicted of or has commited 

acts which would constitute a felony, or misdemeanor involving theft, 

smuggling, or a theft-connected crime. Any change in the employment 

status of the corporate officer (e.g., discharge, resignation, demotion, 

or promotion) prior to conviction of a felony or prior to conviction of 

a misdemeanor involving theft, smuggling, or a theft-connected crime, 

resulting from acts committed while a corporate officer, will not 

preclude application of this provision;

    (4) The operator fails to furnish a current list of names, 

addresses, or other information as required by Sec.  146.7;

    (5) The operator does not provide a secure facility or properly 

safeguard merchandise within a zone;

    (6) [Reserved]

    (7) The operator, or any officer, agent, or employee of the 

operator, discloses to an unauthorized person proprietary information 

contained on a Customs form or in the inventory control and 

recordkeeping system; or

    (8) The inventory control and recordkeeping system is impaired to 

the point where the identity of merchandise in zone status has been lost 

and cannot be reestablished without a suspension of zone operations.

    (b) Procedure--(1) Notice. The port director may, at any time, serve 

notice, in writing, upon an operator to show cause why its right to 

continue operation of a zone should not be suspended or why an 

individual user or activities of an individual user should not be 

suspended, as provided for in paragraph (a) of this section. The notice 

will advise the operator of the grounds for the proposed action and will 

afford the operator an opportunity to respond, in writing, within 15 

days after receipt of the notice. Thereafter, the port director shall 

consider the allegations and any response made by the operator and issue 

a decision, unless the operator requests a hearing in the matter.

    (2) Hearing. If the operator requests a hearing, it will be held 

before a hearing officer designated by the Commissioner of Customs or 

his designee within 30 days following the operator's request. The 

operator may be represented by counsel at the hearing, and any evidence 

and testimony of witnesses in the proceeding, including substantiation 

of the allegations and the response thereto, will be presented. The 

right of cross-examination will be available to both parties. A 

stenographic record of the proceeding will be made and a copy will be 

delivered to the operator. At the conclusion of the hearing, the hearing 

officer shall transmit promptly all papers and the stenographic record 

of the hearing to the Assistant Commissioner, Office of Field 

Operations, or designee, together with a recommendation for final 

action.

    (3) Decision of Assistant Commissioner. Within 10 calendar days 

after delivery to the operator of a copy of the stenographic record of 

the hearing, the operator may submit to the Assistant Commissioner, 

Office of Field Operations,



[[Page 117]]



or designee, in writing any additional views or arguments. The Assistant 

Commissioner, Office of Field Operations, or designee, shall then render 

a written decision stating his reasons therefor. That decision will be 

served on the operator and will be considered the final Customs 

administrative action in the case.

    (4) Grantee. If the grantee of the zone is not the operator, a copy 

of the notice to show cause will be served upon the grantee. The 

grantee, as a party-in-interest, may join the operator in any 

proceedings under this section.



[T.D. 86-16, 51 FR 5049, Feb. 11, 1986, as amended by T.D. 88-63, 53 FR 

40220, Oct. 14, 1988; T.D. 95-99, 60 FR 62733, Dec. 7, 1995]