Import Administration, International Trade Administration, Department of Commerce; Office of Insular Affairs, Department of the Interior.
Notice of proposed rulemaking and request for comments.
The Departments propose amending their regulations governing watch duty-exemption allocations and the watch and jewelry duty-refund benefits for producers in the United States insular possessions (the U.S. Virgin Islands, Guam, American Samoa and the Commonwealth of the Northern Mariana Islands). The proposed rule would amend ITA regulations by clarifying the meaning of “permanent resident” which is a term used in Pub. L. 97-446 and the current regulations.
Written comments must be received on or before September 30, 2002.
Address written comments to Faye Robinson, Acting Director, Statutory Import Programs Staff, FCB, Suite 4100W, U.S. Department of Commerce, 14th and Constitution Ave., NW., Washington, DC 20230.Start Further Info
FOR FURTHER INFORMATION CONTACT:
Faye Robinson, (202) 482-3526, same address as above.End Further Info End Preamble Start Supplemental Information
The insular possessions watch industry provision in Sec. 110 of Pub. L. 97-446 (96 Stat. 2331) (1983), as amended by Sec. 602 of Pub. L. 103-465 (108 Stat. 4991) (1994); additional U.S. Note 5 to chapter 91 of the Harmonized Tariff Schedule of the United States (“HTSUS”), as amended by Pub. L. 94-241 (90 Stat. 263) (1976) requires the Secretary of Commerce and the Secretary of the Interior, acting jointly, to establish a limit on the quantity of watches and watch movements which may be entered free of duty during each calendar year. The law also requires the Secretaries to establish the shares of this limited quantity which may be entered from the Virgin Islands, Guam, American Samoa and the Commonwealth of the Northern Mariana Islands (“CNMI”). After the Departments have verified the data submitted on the annual application (Form ITA-334P), the producers' duty-exemption allocations are calculated from the territorial share in accordance with 15 CFR 303.14 and each producer is issued a duty-exemption license. The law further requires the Secretaries to issue duty-refund certificates to each territorial watch and watch movement producer based on the company's duty-free shipments and creditable wages paid during the previous calendar year.
Pub. L. 106-36 (113 Stat. 127) (1999) authorizes the issuance of a duty-refund certificate to each territorial jewelry producer for any article of jewelry provided for in heading 7113 of the HTSUS which is the product of any such territory. The value of the certificate is based on creditable wages paid and duty-free units shipped into the United States during the previous calendar year. Although the law specifically mentions the U.S. Virgin Islands, Guam and American Samoa, the issuance of the duty-refund certificate would also apply to the CNMI due to the Covenant to Establish a Commonwealth of the Northern Mariana Islands in Political Union with the United States of America (Pub. L. 94-241), which states that goods from the CNMI are entitled to the same tariff treatment as imports from Guam. See also 19 CFR 7.2(a). In order to be considered a product of such territories, the jewelry must meet the U.S. Customs Service substantial transformation requirements (the jewelry must become a new and different article of commerce as a result of production or manufacture performed in the territory). To receive duty-free treatment, the jewelry must also satisfy the requirements of General Note 3(a)(iv) of the HTSUS and applicable Customs Regulations (19 CFR 7.3).
We propose amending Subpart A § 303.2(a) by adding paragraph (a)(16) and Subpart B § 303.16(a) by adding paragraph (a)(11) to provide a definition for “permanent resident” in order to clarify the meaning of the term for purposes of the insular program. The program was designed to spur local employment by giving producers benefits based on creditable wages paid to local people who were permanently domiciled in the insular possessions. Therefore, the Annual Application (Form ITA-334P) has always required each applicant to state the wages paid to employees who did not reside and work in the territory for at least six months during the calendar year so that the wages paid to non-residents could be deducted from the total wages before the creditable wages benefits were calculated. The program was not designed to give benefits based on creditable wages paid to program owners, shareholders or employees who are not domiciled in the insular possessions. We propose a definition that would continue to provide producers with benefits based on creditable wages including the creditable wages paid to program workers who meet the permanent resident criteria which require a person with one or more residences outside the insular possessions to maintain his or her domicile in the insular possessions, to reside (i.e., be physically present for at least 183 days per year) and work in the territory at a program company, and to maintain his or her principal office for day-to-day work in the insular possessions. There will continue to be no benefits based on wages paid to persons who do not meet these permanent resident criteria.
Administrative Law Requirements
Regulatory Flexibility Act
In accordance with the Regulatory Flexibility Act, 5 U.S.C. 601 et seq., the Chief Counsel for Regulation at the Department of Commerce has certified to the Chief Counsel for Advocacy, Small Business Administration, that the proposed rule, if promulgated as final, will not have a significant economic impact on a substantial number of small entities. This rulemaking would clarify the meaning of “permanent resident”. The clarification would have no economic impact on the companies since this would not be a change in policy and this would have no new burdens since there would be no new paperwork requirements.
Paperwork Reduction Act
This proposed rulemaking does not involve new collection-of-information requirements subject to review and approval by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995. Collection activities are currently approved by the Start Printed Page 55376Office of Management and Budget under control numbers 0625-0040 and 0625-0134.
Notwithstanding any other provision of the 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 unless it displays a currently valid OMB Control Number.
Executive Order 12866
It has been determined that the proposed rulemaking is not significant for purposes of Executive Order 12866.Start List of Subjects
List of Subjects in 15 CFR Part 303
- Administrative practice and procedure
- American Samoa
- Customs duties and inspection
- Marketing quotas
- Northern Mariana Islands
- Reporting and recordkeeping requirements
- Virgin Islands
- Watches and jewelry
For reasons set forth above, the Departments propose to amend 15 CFR Part 303 as follows:Start Part
PART 303—WATCHES, WATCH MOVEMENTS AND JEWELRY PROGRAM
1. The authority citation for 15 CFR Part 303 continues to read as follows:
2. Section 303.2 is amended by adding paragraph (a)(16) as follows:
(a) * * *
(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.
3. Section 303.16 is amended by adding paragraph (a)(11) as follows:
(a) * * *
(11) 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.
Assistant Secretary for Import Administration, Department of Commerce.
Acting Deputy Assistant Secretary for Insular Affairs, Department of the Interior.
[FR Doc. 02-22106 Filed 8-28-02; 8:45 am]
BILLING CODES 3510-DS-P; 4310-93-P