Supporting Regulation

§ 19.3

19 CFR Ch. I (4–1–02 Edition)

therein must be furnished to the port
director upon request. The procedures
in the manual shall provide reasonable
assurance that conditionally duty-free
merchandise sold therein will be exported;
(3) If an airport duty-free store, a description of the store’s procedures for
restricting sales of conditionally dutyfree merchandise to personal-use quantities; and
(4) A statement by an authorized official of the appropriate state, local or
other governmental authority administering the exit point facility that the
applicant duty-free store is authorized
to deliver conditionally duty-free merchandise to purchasers at or through
that exit point facility. A separate
statement shall be required for each
governments authority having jurisdiction over exit point facilities through
which the duty-free store intends to deliver merchandise to purchasers. If the
merchandise will be delivered through
an exit point which is not under the jurisdiction of a governmental authority,
the applicant will provide a statement
to that effect.
(c) On approval of the application to
bond a warehouse of any class, except
class 1, a bond shall be executed on
Customs Form 301, containing the bond
conditions set forth in § 113.63 of this
chapter.
(d) [Reserved]
(e) Any proprietor of a bonded warehouse may be required on 10 days’ notice from the port director to furnish a
new bond on Customs Form 301, containing the bond conditions set forth in
§ 113.63 of this chapter; and if he fails to
do so, no more goods shall be sent to
the warehouse and those therein shall
be removed at the expense of such proprietor. A new bond is required if the
bonded warehouse is substantially altered or rebuilt.
(f) As a condition of approval of the
application, the port director may
order an inquiry by a Customs officer
into the qualification, character, and
experience of the applicant (e.g. personal history, financial and business
data, credit and personal references),
and into the security, suitability, and
fitness of the facility. The port director
may require an individual applicant to
submit fingerprints on form FD 258 or

electronically at the time of filing the
application, or in the case of applications from a business entity, may require the fingerprints, on form FD 258
or electronically, of all officers and
managing officials of the business entity.
(g) The port director shall promptly
notify the applicant in writing of his
decision to approve or deny the application to bond the warehouse. If the
application is denied the notification
shall state the grounds for denial. The
decision of the port director will be the
final Customs administrative determination in the matter.
[28 FR 14763, Dec. 31, 1963, as amended by
T.D. 56393, 30 FR 5580, Apr. 20, 1965; T.D. 78–
80, 43 FR 10685, Feb. 15, 1978; T.D. 82–204, 47
FR 49368, Nov. 1, 1982; T.D. 84–213, 49 FR
41169, Oct. 19, 1984; T.D. 92–81, 57 FR 37696,
Aug. 20, 1992; T.D. 93–18, 58 FR 15772, Mar. 24,
1993; T.D. 95–99, 60 FR 62733, Dec. 7, 1995; T.D.
97–19, 62 FR 15834, Apr. 3, 1997; T.D. 99–27, 64
FR 13675, Mar. 22, 1999; T.D. 01–14, 66 FR 8767,
Feb. 2, 2001]

§ 19.3 Bonded warehouses; alterations;
relocation; suspensions; discontinuance.
(a) Alterations or relocation. Alterations to or relocation of a warehouse
may be made with the permission of
the director of the port nearest to
where the facility is located.
(b) Suspensions. The use of all or part
of a bonded warehouse or bonded floor
space may be temporarily suspended by
the port director of a period not to exceed one year on written application of
the proprietor if there are no bonded
goods in the area. Upon written application of the proprietor and upon the
removal of all nonbonded goods, if any,
the premises may again be used for the
storage of bonded goods. If the application is approved, the port director shall
indicate the approval by endorsement
on the application. Rebonding will not
be necessary as long as the original
bond remains in force.
(c) Discontinuance. If a proprietor
wishes to discontinue the bonded status of the warehouse, he shall make
written application to the port director. The port director shall not approve
the application until all goods in the
warehouse are transferred to another
bonded warehouse without expense to
the Government. To reestablish the

292

VerDate Mar<13>2002

12:40 Apr 10, 2002

Jkt 197056

PO 00000

Frm 00292

Fmt 8010

Sfmt 8010

Y:\SGML\197056T.XXX

pfrm03

PsN: 197056T

United States Customs Service, Treasury
bonded warehouse, application shall be
made and approved under the provision
of § 19.2 of this chapter.
(d) Employee lists. The port director
may make a written demand upon the
proprietor to submit, within 30 days
after the date of demand, a written list
of the names, addresses, social security
numbers, and dates and places of birth
of all persons employed by the proprietor in the carriage, receiving, storage,
or delivery of any bonded merchandise.
If a list has been previously furnished
the proprietor shall advise the port director in writing of the names, addresses, social security numbers, and dates
and places of birth of any new personnel employed by him in the carriage, receiving, storage, or delivery of
bonded merchandise within 10 days
after such employment. For the purpose of this part a person shall not be
deemed to be employed by a warehouse
proprietor if he is an officer or employee of an independent contractor
engaged by the warehouse proprietor to
load, unload, transport, or otherwise
handle bonded merchandise.
(e) Revocation or suspension for cause.
The port director may revoke or suspend for cause the right of a proprietor
to continue the bonded status of the
warehouse for any ground specified in
this paragraph. An action to suspend or
revoke the right to operate a bonded
warehouse shall be taken in accordance
with the procedures set forth in paragraph (f) of this section. If the bonded
status is revoked or suspended for
cause, the port director shall require
all goods in the warehouse to be transferred to a bonded warehouse without
expense to the Government. The bonded status of a warehouse may be revoked or suspended for cause if:
(1) The approval of the application to
bond the warehouse was obtained
through fraud or the misstatement of a
material fact;
(2) The warehouse proprietor refuses
or neglects to obey any proper order of
a Customs officer or any Customs
order, rule, or regulation relative to
the operation or administration of a
bonded warehouse;
(3) The warehouse proprietor or an
officer of a corporation which has been
granted the right to operate a bonded
warehouse is convicted of or has com-

§ 19.3
mitted acts which would constitute a
felony, or a 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 warehouse proprietor does not
provide secured facilities or properly
safeguard merchandise within the
bonded warehouse;
(5) The warehouse proprietor fails to
furnish a current list of names, addresses, and other information required
by § 19.3(d);
(6) The bond required by § 19.2(c) or
(d) of this chapter is determined to be
insufficient in amount or lacking sufficient sureties, and a satisfactory new
bond with goods and sufficient sureties
is not furnished within a reasonable
time;
(7) Bonded merchandise has not been
stored in the warehouse for a period of
2 year; or
(8) The warehouse proprietor or an
employee of the warehouse proprietor
discloses proprietary information in, or
proprietary information contained on,
documents to be included in the permit
file folder to an unauthorized person.
(9) The proprietor of a Class 9 warehouse is or has been unable to provide
reasonable
assurance
that
conditionally duty-free merchandise is or
was exported in compliance with the
regulations of this part.
(f) Procedure for revocation or suspension for cause. The port director may at
any time serve notice in writing upon
any proprietor of a bonded warehouse
to show cause why his right to continue the bonded status of his warehouse should not be revoked or suspended for cause. Such notice shall advise the proprietor of the grounds for
the proposed action and shall afford
the proprietor an opportunity to respond in writing within 30 days. Thereafter, the port director shall consider
the allegations and responses made by
the proprietor unless the proprietor in
his response requests a hearing. If a

293

VerDate Mar<13>2002

12:40 Apr 10, 2002

Jkt 197056

PO 00000

Frm 00293

Fmt 8010

Sfmt 8010

Y:\SGML\197056T.XXX

pfrm03

PsN: 197056T

§ 19.4

19 CFR Ch. I (4–1–02 Edition)

hearing is requested, it shall be held
before a hearing officer designated by
the Commissioner of Customs or his
designee within 30 days following the
proprietor’s request. The proprietor
may be represented by counsel at such
hearing, and all evidence and testimony of witnesses in such proceedings,
including substantiation of the allegations and the responses thereto shall be
presented, with the right of cross-examination to both parties. A stenographic record of any such proceeding
shall be made and a copy thereof shall
be delivered to the proprietor of the
warehouse. At the conclusion of the
hearing, the hearing officer shall
promptly transmit all papers and the
stenographic record of the hearing to
the Assistant Commissioner, Office of
Field Operations or designee together
with his recommendation for final action. The proprietor may submit in
writing additional views or arguments
to the Assistant Commissioner, Office
of Field Operations or designee following a hearing on the basis of the
stenographic record, within 10 days
after delivery to him of a copy of such
record. The Assistant Commissioner,
Office of Field Operations or designee
shall thereafter render his decision in
writing, stating his reasons therefor.
Such decision shall be served on the
proprietor of the warehouse, and shall
be considered the final administrative
action.
(g) Review by the Court of International Trade. Any proprietor adversely affected by a decision of the Assistant Commissioner, Office of Field
Operations or designee may appeal the
decision in the Court of International
Trade.
[T.D. 82–204, 47 FR 49369, Nov. 1, 1982, as
amended by T.D. 85–90, 50 FR 21431, May 24,
1985; T.D. 88–63, 53 FR 40219, Oct. 14, 1988; T.D.
92–81, 57 FR 37697, Aug. 20, 1992; T.D. 95–99, 60
FR 62733, Dec. 7, 1995; T.D. 99–27, 64 FR 13675,
Mar. 22, 1999]

§ 19.4 Customs and proprietor responsibility and supervision over warehouses.
(a) Customs supervision. The character
and extent of Customs supervision to
be exercised in connection with any
warehouse facility or transaction provided for in this part shall be in accord-

ance with § 101.2(c) of this chapter.
Independent of any need to appraise or
classify merchandise, the port director
may authorize a Customs officer to supervise any transaction or procedure at
the bonded warehouse facility. Such
supervision may be performed through
periodic audits of the warehouse proprietor’s records, quantity counts of
goods in warehouse inventories, spot
checks of selected warehouse transactions or procedures or reviews of conditions of recordkeeping, storage, security, or safety in a warehouse facility.
(b) Proprietor responsibility and supervision—(1) Supervision. The proprietor
shall supervise all transportation, receipts, deliveries, sampling, recordkeeping, repacking, manipulation, destruction, physical and procedural security, conditions of storage, and safety in the warehouse as required by law
and regulations. Supervision by the
proprietor shall be that which a prudent manager of a storage and manipulation facility would be expected to exercise.
(2) Customs access. The warehouse
proprietor shall permit access to the
warehouse and present merchandise
within a reasonable time after request
by any Customs officer.
(3) Safekeeping of merchandise and
records. The proprietor is responsible
for safekeeping of merchandise and
records concerning merchandise entered in Customs bonded warehouses.
The proprietor or his employees shall
safeguard and shall not disclose proprietary information contained in or on
related documents to anyone other
than the importer, importer’s transferee, or owner of the merchandise to
whom the document relates or their
authorized agent.
(4) Records maintenance—(i) Maintenance. The proprietor shall:
(A) Maintain the inventory control
and recordkeeping system in accordance with the provisions of § 19.12 of
this part;
(B) Retain all records required in this
part and defined in § 163.1(a) of this
chapter, pertaining to bonded merchandise for 5 years after the date of the
final withdrawal under the entry; and
(C) Protect proprietary information
in its custody from unauthorized disclosure.

294

VerDate Mar<13>2002

12:40 Apr 10, 2002

Jkt 197056

PO 00000

Frm 00294

Fmt 8010

Sfmt 8010

Y:\SGML\197056T.XXX

pfrm03

PsN: 197056T