[Federal Register: July 24, 2007 (Volume 72, Number 141)]
[Rules
and Regulations]
[Page 40235-40238]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr24jy07-9]
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DEPARTMENT OF COMMERCE
International Trade Administration
15 CFR Part 336
[Docket Number: 070712324-7325-01]
RIN 0625-AA74
Imports of Certain Cotton Shirting Fabric: Implementation of
Tariff Rate Quota Established Under the Tax Relief and Health Care Act
of 2006
AGENCY: Department of Commerce, International Trade Administration.
ACTION: Interim final rule, request for comments.
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SUMMARY: The Department of Commerce is issuing interim regulations
implementing Section 406 of the Tax Relief and Health Care Act of 2006
(``the Act''), which President Bush signed into law on December 20,
2006 (Pub. L. 109-432). Section 406(b)(1) authorizes the Secretary of
Commerce to issue licenses to eligible manufacturers under headings
9902.52.08 through 9902.52.19 of the Harmonized Tariff Schedule of the
United States, specifying the restrictions under each such license on
the quantity of cotton woven fabrics that may be entered each year by
or on behalf of the manufacturer.
DATES: This interim final rule is effective July 24, 2007. To be
considered, written comments must be received by 5 p.m. on September
24, 2007.
ADDRESSES: Comments should be addressed to: R. Matthew Priest, Deputy
Assistant Secretary for Textiles and Apparel, Room 3001, United States
Department of Commerce, Washington, DC 20230.
FOR FURTHER INFORMATION CONTACT: Sergio Botero, Office of Textiles and
Apparel, U.S. Department of Commerce, (202) 482-4058.
SUPPLEMENTARY INFORMATION:
Background
The Department of Commerce is issuing interim regulations
implementing Section 406 of the Tax Relief and Health Care Act of 2006
(``the Act''), which President Bush signed into law on December 20,
2006 (Pub. L. 109-432). Section 406(b)(1) authorizes the Secretary of
Commerce to issue licenses to eligible manufacturers under headings
9902.52.08 through 9902.52.19 of the Harmonized Tariff Schedule of the
United States, specifying the restrictions under each such license on
the quantity of cotton woven fabrics that may be entered each year by
or on behalf of the manufacturer.
The Act creates an annual tariff rate quota providing for temporary
reductions through December 31, 2009 in the import duties of cotton
woven fabrics suitable for making cotton shirts (new Harmonized Tariff
Schedule of the United States (HTS) headings 9902.52.08, 9902.52.09,
9902.52.10, 9902.52.11, 9902.52.12, 9902.52.13, 9902.52.14, 9902.52.15,
9902.52.16, 9902.52.17, 9902.52.18, and 9902.52.19). The reduction in
duty is limited to 85 percent of the total square meter equivalents of
all imported woven fabrics of cotton containing 85 percent or more by
weight of cotton used by manufacturers in cutting and sewing men's and
boy's cotton shirts in the United States and purchased by such
manufacturers during calendar year 2000.
The Act requires that the Secretary of Commerce must issue licenses
and ensure that the tariff rate quotas are fairly allocated to eligible
manufacturers under such headings 9902.52.08 through 9902.52.19.
The Department, promptly upon promulgation of these interim
regulations, intends to begin the process of soliciting applications
for a license allocation of the 2007 tariff rate quota. Licenses will
be issued to eligible manufacturers within 60 days after the
manufacturer files an application with the Department. In subsequent
years the Department intends to make its determination regarding
allocation of the tariff rate quota no later than December 31 of the
year preceding the tariff rate quota year
The tariff rate quota licenses will be issued to eligible
manufacturers on the basis of the percentage of each manufacturer's
quantity of imported woven fabrics described under HTS headings
9902.52.08 through 9902.52.19 during calendar year 2000, compared to
the imports of such fabric by all manufacturers that qualify for a
tariff rate quota allocation.
Pursuant to statutory requirements, allocation will be limited to
persons (including firms, corporations, or other legal entities) who
cut and sew men's and boys' cotton shirts in the United States and who,
during calendar year 2000, were manufacturers cutting and sewing men's
and boy's cotton shirts in the United States from imported woven
fabrics of cotton containing 85 percent or more by weight of cotton of
the kind described in HTS headings 9902.52.08 through 9902.52.19
purchased by such manufacturers during calendar year 2000. Any
manufacturer who becomes a successor-of-interest to a manufacturer of
the cotton woven shirts described in HTS headings 9902.52.08 through
9902.52.19 during 2000 because of a reorganization or otherwise, shall
be eligible to apply for a TRQ.
In order to receive a license, eligible manufactures must submit
ITA Form ITA-4156P entitled ``Affidavit for Application for TRQ License
Cotton Shirting Fabric Tariff Rate Quota'' containing the following
information:
(1) Company name, address, contact telephone number, e-mail
address, federal tax identification number, name of person submitting
the application, and title, or capacity in which the person is acting
for the applicant.
(2) The name and address of each plant and/or contractor location
in the United States where men's and boy's cotton shirts of imported
woven fabric of the kind described in HTS headings 9902.52.08 through
9902.52.19 was cut and sewn in calendar year 2000.
(3) The date of purchase shall be (a) the invoice date if the
manufacturer is not the importer of record; and (b) the date of entry
if the manufacturer is the importer of record.
(4) The quantity of imported woven fabrics of cotton containing 85
percent or more by weight of cotton purchased during calendar year 2000
for use in the cutting and sewing of men's and boys' shirts in the
United States.
At the conclusion of the application the applicant must attest that
``all information contained in the application is complete and correct
and no false claims, statements or representations have been made.''
Applicants should be aware that, generally, pursuant to 31 U.S.C. 3729
persons providing false or fraudulent claims, and pursuant to 18 U.S.C.
101, persons making materially false statement to representations, are
subject to civil or criminal penalties, respectively. All applications
must be notarized by a licensed public notary.
[[Page 40236]]
Any business confidential information provided pursuant must be
marked ``business confidential.'' Such information will be kept
confidential and protected from disclosure to the full extent permitted
by law.
The applicant must retain records substantiating the information
provided in the application for a period of 3 years. Such records must
be made available upon request by an appropriate government official.
Conditions of License Use
The importer of record of fabric entered or withdrawn from
warehouse for consumption under a license must be the Licensee or an
importer authorized by the Licensee to act on its behalf. A Licensee
may only authorize an importer to import fabric under the license on
its behalf by making such authorization in writing or by electronic
notice to the importer and providing a copy of such authorization to
the Department. The authorization must include the unique number of the
license, must specify the type of fabric imported by micron count, and
must be in the possession of the importer at the time of filing the
entry summary or warehouse withdrawal for consumption (Customs Form
7501) or its electronic equivalent. The authorization also must include
the unique PIN assigned by the licensee to the importer. A copy of the
authorization and PIN assigned to each importer must be provided to the
Department by fax (202) 482-0667 or by mail to the Office of Textiles
and Apparel, Room 3001, United States Department of Commerce,
Washington, DC 20230. This authorization may only be withdrawn by
notifying the importer, in writing or by electronic notice, with a copy
provided to the Department. The licensee also must advise the
Department of each authorized importer's Importer of Record
Identification Number.
The licensee should inform its authorized importers that if they
enter an amount less than the exact amount requested and authorized by
the Import Approval, the importer must annotate the Import Approval
form and send a copy to the Department and to the licensee. This
annotation will be used to correct the record of use of the license.
Failure to provide such information could disrupt the orderly use of
the license. Imports in excess of amount of import approval are not
authorized.
Classification
Executive Order 12866: This rule has been determined to be not
significant under E.O. 12866.
Administrative Procedure Act: The Department of Commerce finds good
cause, under 5 U.S.C. 553(b)(B), to waive the requirement to provide
prior notice and opportunity for public comment as such requirement is
impracticable and contrary to the public interest. The new HTS
categories and allocation system must be implemented as soon as
possible to allow TRQ recipients to import their products under the new
HTS categories and allocation system.
If the new HTS category and allocation system are not implemented
immediately, TRQ recipients will be required to file amended entries
with U.S. Customs and Border Protection (CBP) in order to get the duty
benefit. The Act entered into force in December 20, 2006, created an
annual tariff rate quota providing for temporary reductions through
December 31, 2009 in the import duties of cotton woven fabrics suitable
for making cotton shirts (new Harmonized Tariff Schedule of the United
States (HTS) headings 9902.52.08, 9902.52.09, 9902.52.10, 9902.52.11,
9902.52.12, 9902.52.13, 9902.52.14, 9902.52.15, 9902.52.16, 9902.52.17,
9902.52.18, and 9902.52.19). The reduction in duty is limited to 85
percent of the total square meter equivalents of all imported woven
fabrics of cotton containing 85 percent or more by weight cotton used
by manufacturers in cutting and sewing men's and boy's cotton shirts in
the United States and purchased by such manufacturer during calendar
year 2000. The Act establishes that the TRQ is to be administered on a
calendar year (January 1 to December 31) basis. While the Act does not
specify a start date, Congress plainly intended the TRQ to be in effect
in the first calendar year following the enactment, or January 1, 2007-
December 31, 2007. During the calendar year of the date of application,
an applicant must have cut and sewed men's and boys' cotton woven
shirts in the United States. Furthermore, an applicant must have,
during calendar year 2000, cut and sewed men's and boy's cotton shirts
in the United States from imported woven fabrics of cotton containing
85 percent or more by weight of cotton of the kind described in HTS
headings 9902.52.08 through 9902.5219 purchased by such manufacturer
during calendar year 2000. The applicant may have cut or sewn these
cotton shirts on its own behalf or had another person cut and sew the
cotton shirts on the applicant's behalf, provided the applicant owned
the fabric at the time it was cut and sewn.
Amended entries are costly and time consuming. To obtain the duty
benefits under a TRQ from a license issued after cotton fabric has
cleared CBP, a Licensee would need to request its brokers and other
suppliers to file amended entries on its behalf with CBP in order to
obtain the duty rebates applicable to the TRQ license. This process is
time consuming and costly as additional staff would need to be hired
and extra hours devoted to research and file amended entries. Brokers
would need to research thousand of shipments, imported into several
different ports, in order to file amended entries. Brokers and other
suppliers do not always have the resources and personnel in order to
investigate individual shipments for individual companies to file
entries retroactively. The average cost charged by brokers and
suppliers for researching shipments range from $100 to $200 to file
amended entries, which would in effect nullify the duty benefit for
small shipments which may make up the bulk of the entries for
licensees.
For the same reasons above, there is good cause to find under 5
U.S.C. 553(d)(3) to waive the 30-day delay in effectiveness. As stated
above, the process of researching shipments to file amended entries is
time consuming and costly. If this regulation is not implemented
immediately, the costs incurred by TRQ recipients would in effect
nullify any duty benefits, particularly for those TRQ recipients who
have small shipments.
While these regulations will be effective upon publication, the
Department of Commerce hereby solicits comments on these interim
regulations and will amend them in final regulations if appropriate.
The Department is particularly interested in comments concerning any
impact these regulations might have on small-or-medium sized
businesses.
Paperwork Reduction Act: This interim rule contains information
collection requirements subject to the Paperwork Reduction Act (PRA).
This information collection requirements have been approved by Office
of Management and Budget (OMB) under an emergency request under Control
Number 0625-0260. A request for permanent approval is pending. When the
approval is provided, notice will be published in the Federal Register.
Notwithstanding any other provision of law, no person is required
to respond to, nor shall any person be subject to a penalty for failure
to comply with, a collection of information subject to the requirements
of the PRA unless that collection of information displays a current
valid OMB control number. The information collected will be used by the
Department to allocate the tariff rate
[[Page 40237]]
quota among manufacturers. Responses to the collection of information
are required for a manufacturer to receive allocation of the tariff
rate quota. Records substantiating information provided in an
application must be retained. It is estimated that the annual burden
for the collection will average one hour per application. This includes
the time for reviewing instructions, searching existing data sources,
gathering and maintaining the data needed, and completing and reviewing
the collection of information. Send comments regarding this burden
estimate or any other aspect of this collection of information,
including suggestions for reducing this burden, to the Office of
Management and Budget, Washington, DC 20503 (Attention: ITA Desk
Officer).
Dated: July 18, 2007.
Joseph A. Spetrini,
Deputy Assistant Secretary for Import Administration.
List of Subjects
15 CFR Part 336
Imports, Quotas, Reporting and Recordkeeping, Tariffs, Textiles.
0
For reasons stated in the preamble, Part 336 is added to title 15 of
the Code of Federal Regulations to read as follows:
PART 336--IMPORTS OF COTTON WOVEN FABRIC
Sec.
Sec. 336.1 Purpose.
Sec. 336.2 Definitions.
Sec. 336.3 Eligibility Criteria and Application Requirements to
receive allocation.
Sec. 336.4 Allocation.
Sec. 336.5 Licenses.
Authority: Section 406 Public Law 109-434. Tax Relief and Health
Care Act of 2006. December 9, 2006.
Sec. 336.1 Purpose.
This part sets forth regulations regarding the issuance and effect
of licenses for allocation of Cotton Woven Fabric under the Tariff Rate
Quota established by Section 406 of the Act.
Sec. 336.2 Definitions.
For purposes of these regulations:
Act means the Tax Relief and Health Care Act of 2006 (Public Law
109-434).
Cotton Shirts means men's and boys' cotton shirts made from woven
fabric containing 85 percent or more by weight of cotton.
Cotton Woven Fabric means woven fabrics of cotton containing 85
percent or more by weight of cotton.
Department means the United Sates Department of Commerce.
HTS means the Harmonized Tariff Schedule of the United States.
Imports subject to Tariff Rate Quota are defined by date of
presentation as defined in 19 CFR 132.1(d) and 19 CFR 132.11(a).
Licensee means applicant for an allocation of the Tariff Rate Quota
that receives an allocation and a license.
Manufacturer means a person or entity that cuts and sews men's and
boys' cotton woven shirts in the United States.
Tariff Rate Quota or Quotas means the temporary duty reduction
provided under Section 406 of the Act for limited quantities of cotton
woven fabrics entered under HTS headings 9902.52.08 through 9902.52.19
suitable for use in making men's and boys' cotton woven shirts.
Tariff Rate Quota Year means a calendar year for which the Tariff
Rate Quotas are in effect.
Sec. 336.3 Eligibility Criteria and Application Requirements to
receive allocation.
(a) In each year prior to the Tariff Rate Quota Year, the
Department will cause to be published a Federal Register notice
soliciting applications to receive an allocation of the Tariff Rate
Quotas.
(b) An application for a Tariff Rate Quota must be received, or
postmarked by the U.S. Postal Service, within 30 calendar days after
the date of publication of the Federal Register notice soliciting
applications.
(c) Eligibility
The TRQ is available to manufacturers that during the calendar year
of the date of application, have cut and sewed men's and boys' cotton
woven shirts in the United States. Furthermore, an applicant must have,
during calendar year 2000, cut and sewed men's and boy's cotton shirts
in the United States from imported woven fabrics of cotton containing
85 percent or more by weight of cotton of the kind described in HTS
headings 9902.52.08 through 9902.5219 purchased by such manufacturer
during calendar year 2000. The applicant may have cut or sewn these
cotton shirts on its own behalf or had another person cut and sew the
cotton shirts on the applicant's behalf, provided the applicant owned
the fabric at the time it was cut and sewn. Any manufacturer who
becomes a successor-of-interest to a manufacturer of the cotton shirts
described in HTS headings 9902.52.08 through 9902.52.19 during 2000
because of a reorganization or otherwise, shall be eligible to apply
for a TRQ.
(d) Application Requirements:
To receive consideration for a TRQ, an applicant must submit ITA
Form ITA-4156P providing the following information:
(1) Identification: Company name, address, contact telephone
number, e-mail address, federal tax identification number, name of
person submitting the application, and title, or capacity in which the
person is acting for the applicant.
(2) Manufacturing Facilities: The name and address of each plant or
location in the United States where men's and boy's cotton shirts of
imported woven fabric of the kind described in HTS headings 9902.52.08
through 9902.52.19 was cut and sewn in calendar year 2000.
(3) Date of purchase: The date of purchase shall be (a) the invoice
date if the manufacturer is not the importer of record; and (b) the
date of entry if the manufacturer is the importer of record.
(4) Quantity of fabric: The quantity of imported woven fabrics of
cotton containing 85 percent or more by weight of cotton purchased
during calendar year 2000 for use in the cutting and sewing of men's
and boys' shirts in the United States.
(5) Affidavit: At the conclusion of the application an officer of
the manufacturer must certify that the manufacturer is eligible to
receive a license and stating the quantity of imported woven fabrics of
cotton containing 85 percent or more by weight of cotton purchased
during calendar year 2000 for use in the cutting and sewing of men's
and boys' shirts in the United States and attest that all information
contained in the application is complete and correct and no false
claims, statements or representations have been made. Applicants should
be aware that, generally, pursuant to 31 U.S.C. 3729 persons providing
false or fraudulent claims, and pursuant to 18 U.S.C. 101, persons
making materially false statement to representations, are subject to
civil or criminal penalties, respectively.
(6) Notarization. All application must be notarized by a licensed
public notary.
(e) Confidentiality. Any business confidential information provided
pursuant to this section that is marked ``business confidential'' will
be kept confidential and protected from disclosure to the full extent
permitted by law.
(f) Record Retention: The applicant shall retain records
substantiating the information provided in Sec. 336.3(d)(2), and (3),
and (4) for a period of 3 years and the records must be made available
upon request by an appropriate government official.
[[Page 40238]]
Sec. 336.4 Allocation.
(a) The Tariff Rate Quota licenses will be issued to eligible
manufacturers on the basis of the percentage of each manufacturer's
quantity of imported woven fabrics described under HTS headings
9902.52.08 through 9902.52.19 during calendar year 2000, compared to
the imports of such fabric by all manufacturers that qualify for a
Tariff Rate Quota license.
(b) The Department will cause to be published in the Federal
Register its determination to allocate Tariff Rate Quotas and issue
licenses to manufacturers within 60 days after the manufacturers file
an application with the Department.
Sec. 336.5 Licenses.
(a) Each Licensee will receive a license, which will include a
unique control number.
(b) A license may be exercised only for fabric entered for
consumption, or withdrawn from warehouse for consumption, during the
Tariff Rate Quota Year specified in the license. A licensee will be
debited on the basis of date of entry for consumption or withdrawal
from warehouse for consumption.
(c) A Licensee may import fabric certified by the importer as
suitable for use in making men's and boys' cotton shirts under the
Tariff Rate Quota as specified in the license up to the quantity
specified in the license subject to the Tariff Rate Quota duty rate.
Only a Licensee or an importer authorized by a Licensee will be
permitted to import fabric under the Tariff Rate Quota and to receive
the Tariff Rate Quota duty rate.
(d) The term of the license shall be the Tariff Rate Quota Year for
which it is issued. Fabric may be entered or withdrawn from warehouse
for consumption under a license only during the term of that license.
The license cannot be used for fabric entered or withdrawn from
warehouse for consumption after December 31 of the year of the term of
the license.
(e) The importer of fabric entered or withdrawn from warehouse for
consumption under a license must be the Licensee or an importer
authorized by the licensee to act on its behalf. If the importer of
record is the Licensee, the importer must possess the license at the
time of filing the entry summary or warehouse withdrawal for
consumption (Customs Form 7501).
(f) A Licensee may only authorize an importer to import fabric
under the license on its behalf by making such an authorization in
writing or by electronic notice to the importer and providing a copy of
such authorization to the Department. A Licensee may only withdraw
authorization from an importer by notifying the importer, in writing or
by electronic notice, and providing a copy to the Department.
(g) The written authorization must include a unique number of the
license, must specifically cover the type of fabric imported, and must
be in possession of the importer at the time of filing the entry
summary or warehouse withdrawal for consumption (Customs Form 7501), or
its electronic equivalent, in order for the importer to obtain the
applicable Tariff Rate Quota duty rate. The authorization also must
include the unique PIN assigned by the licensee to the importer. A copy
of the authorization and PIN assigned to each importer must be provided
to the Department by fax (202) 482-0667 or by mail to the Office of
Textiles and Apparel, Room 3001, United States Department of Commerce,
Washington, D.C. 20230 . The licensee also must advise the Department
of each authorized importer's Importer of Record Identification Number.
(h) It is the responsibility of the Licensee to safeguard the use
of the license issued. The Department and U.S. Customs and Border
Protection will not be liable for any improper use of the license.
(i) The licensee should inform its authorized importers that if
they enter an amount less than the exact amount requested and
authorized by the Import Approval, the importer must annotate the
Import Approval form and send a copy to the Department and to the
licensee. This annotation will be used to correct the record of use of
the license. Failure to provide such information could disrupt the
orderly use of the license. Imports in excess of amount of import
approval are not authorized.
[FR Doc. E7-14321 Filed 7-23-07; 8:45 am]
BILLING CODE 3510-DS-S