supporting CFR

§ 7.11

19 CFR Ch. I (4–1–11 Edition)

(b) The Form ITA–360 may not be
used to secure refunds. To secure a refund, the party requesting the refund
of duties (claimant) must present to
CBP Form ITA–361, Request for Refund
of Duties on Watches and Watch Movements, properly executed, and authenticated by the Department of Commerce.
(c) By completing Form ITA–361, the
insular producer may either:
(1) Transfer its entitlement, in whole
or in part, to any other party for any
consideration agreed to by the insular
producer and the transferee, or
(2) Request the refund of duties to
itself.
(d) A claimant must file Form ITA–
361 with CBP at the same port where
the watch import entry was originally
filed and duties paid. The documentation accompanying Form ITA–361 shall
include a copy of the import entry, providing proof that duty was paid on the
watches and watch movements.
(e) When requesting the refund of duties on Form ITA–361, the claimant
also must complete and submit to CBP
the declaration on the form which
reads as follows:

is depleted or until the certificate expires 1 year from its date of issuance.
(h) CBP will process only those refund requests made in accordance with
the joint rules of the Departments of
Commerce and the Interior governing
the issuance and handling of certificates and the transfer of entitlements
as contained in 15 CFR part 303.

I declare that the information given above
is true and correct to the best of my knowledge and belief; that no notices of exportation of articles with benefit of drawback
were filed upon exportation of this merchandise from the United States; that no liquidated refunds on the articles relating to
the present claim have been paid; and that
no protest or request for litigation for refund
of duties paid and herewith claimed has been
made.

ARTICLES EXPORTED AND RETURNED

[T.D. 84–16, 49 FR 1481, Jan. 12, 1984, as
amended by T.D. 84–211, 49 FR 39044, Oct. 3,
1984; T.D. 89–1, 53 FR 51252, Dec. 21, 1988. Redesignated and amended by T.D. 97–75, 62 FR
46441, Sept. 3, 1997 ; CBP Dec. 08-25, 73 FR
40725, July 16, 2008]

§ 7.11 Guantanamo Bay Naval Station.
Articles of foreign origin may enter
the area (both land and water) of the
Guantanamo Bay Naval Station free of
duty, but such articles shall be subject
to duty upon their subsequent entry
into the United States.
[28 FR 14636, Dec. 31, 1963]

PART
10—ARTICLES
CONDITIONALLY FREE, SUBJECT TO A
REDUCED RATE, ETC.
Subpart A—General Provisions
Sec.
10.1 Domestic products; requirements on
entry.
10.3 Drawback; internal-revenue tax.
10.4 Internal-revenue marks; erasure.
10.5 Shooks and staves; cloth boards; port
director’s account.
10.6 Shooks and staves; claim for duty exemption.
10.7 Substantial containers or holders.
10.8 Articles exported for repairs or alterations.
10.8a Imported articles exported and reimported.
10.9 Articles exported for processing.
10.10 [Reserved]

(f) A fee of 1 percent will be deducted
from each refund request as reimbursement to salaries and expenses of those
CBP personnel processing the request.
(g) Form ITA–360 expires 1 year from
its date of issuance. Any refund request
on Form ITA–361 made by either the
insular producer itself or any transferee named on Form ITA–360 must be
filed within this 1-year period. This expiration date applies equally to all refund requests, whether a single request
for the entire amount specified in the
Form ITA–361 certificate or multiple
requests for partial amounts. Refund
requests will be accepted until either
the amount specified in the certificate

ARTICLES ASSEMBLED ABROAD WITH UNITED
STATES COMPONENTS
10.11 General.
10.12 Definitions.
10.13 Statutory
provision:
Subheading
9802.00.80, Harmonized Tariff Schedule of
the United States (19 U.S.C. 1202).
10.14 Fabricated components subject to the
exemption.
10.15 Fabricated components not subject to
the exemption.
10.16 Assembly abroad.
10.17 Valuation of exempted components.

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U.S. Customs and Border Protection, DHS; Treasury
BOLTING CLOTHS

10.18 Valuation of assembled articles.
10.19–10.20 [Reserved]
10.21 Updating cost data and other information.
10.23 Standards, quotas, and visas.
10.24 Documentation.
10.25 Textile components cut to shape in
the United States and assembled abroad.
10.26 Articles assembled or processed in a
beneficiary country in whole of U.S.
components or ingredients; articles assembled in a beneficiary country from
textile components cut to shape in the
United States.

10.58

10.59 Exemption from customs duties and
internal-revenue tax.
10.60 Forms of withdrawals; bond.
10.61 Withdrawal permit.
10.62 Bunker fuel oil.
10.62a Blanket withdrawals for certain merchandise.
10.62b Aircraft turbine fuel.
10.63 Landing of supplies and stores from receiving vessel in the United States.
10.64 Crediting or cancellation of bonds.
10.64a [Reserved]
10.65 Cigars and cigarettes.

[Reserved]

TEMPORARY IMPORTATIONS UNDER BOND

ARTICLES EXPORTED FOR EXHIBITION, ETC.

10.31 Entry; bond.
10.33 Theatrical effects.
10.35 Models of women’s wearing apparel.
10.36 Commercial travelers’ samples; professional equipment and tools of trade; theatrical effects and other articles.
10.36a Vehicles, pleasure boats and aircraft
brought in for repair or alteration.
10.37 Extension of time for exportation.
10.38 Exportation.
10.39 Cancellation of bond charges.
10.40 Refund of cash deposits.

10.66 Articles exported for temporary exhibition and returned; horses exported for
horse racing and returned; procedure on
entry.
10.67 Articles exported for scientific or educational purposes and returned; procedure on entry.
EFFECTS,
MOTION-PICTURE
THEATRICAL
FILMS, COMMERCIAL TRAVELERS’ SAMPLES,
AND TOOLS OF TRADE
10.68 Procedure.
10.69 Samples to Great Britain and Ireland
under reciprocal agreement.

INTERNATIONAL TRAFFIC
10.41 Instruments; exceptions.
10.41a Lift vans, cargo vans, shipping tanks,
skids, pallets, and similar instruments of
international traffic; repair components.
10.41b Clearance of serially numbered substantial holders or outer containers.

ANIMALS AND BIRDS
10.70 Purebred animals for breeding purposes; certificate.
10.71 Purebred animals; bond for production
of evidence; deposit of estimated duties;
stipulation.
10.72–10.73 [Reserved]
10.74 Animals straying across boundary for
pasturage; offspring.
10.75 Wild animals and birds; zoological collections.
10.76 Game animals and birds.
10.77 [Reserved]

ARTICLES FOR INSTITUTIONS
10.43 Duty-free status.
10.46 Articles for the United States.
10.47 [Reserved]
WORKS OF ART
10.48 Engravings, sculptures, etc.
10.49 Articles for exhibition; requirements
on entry.
10.50 [Reserved]
10.52 Painted, colored or stained glass windows for religious institutions.
10.53 Antiques.
10.54 Gobelin and other hand-woven tapestries.

PRODUCTS OF AMERICAN FISHERIES
10.78
10.79

Entry.
[Reserved]

10.80
10.81
10.82
10.83

Remission of duty; withdrawal; bond.
Use in any port.
[Reserved]
Bond; cancellation; extension.

SALT FOR CURING FISH

VEGETABLE OILS
10.56

Bolting cloths; marking.

WITHDRAWAL OF SUPPLIES AND EQUIPMENT
FOR VESSELS

FREE ENTRY—ARTICLES FOR THE USE OF
FOREIGN MILITARY PERSONNEL
10.30c

Pt. 10

Vegetable oils, denaturing; release.
AUTOMOTIVE PRODUCTS
POTATOES, CORN, OR MAIZE

10.84 Automotive vehicles and articles for
use as original equipment in the manufacture of automotive vehicles.

10.57 Certified seed potatoes, and seed corn
or maize.

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Pt. 10

19 CFR Ch. I (4–1–11 Edition)

MASTER RECORDS, AND METAL MATRICES
10.90

IMPORTATIONS NOT OVER $200 AND BONA FIDE
GIFTS

Master records and metal matrices.

10.151
10.152
10.153

PROTOTYPES
10.91 Prototypes used exclusively for product development and testing.
10.92–10.97 [Reserved]

GENERALIZED SYSTEM OF PREFERENCES
10.171 General.
10.172 Claim for exemption from duty under
the Generalized System of Preferences.
10.173 Evidence of country of origin.
10.174 Evidence of direct shipment.
10.175 Imported directly defined.
10.176 Country of origin criteria.
10.177 Cost or value of materials produced
in the beneficiary developing country.
10.178 Direct costs of processing operations
performed in the beneficiary developing
country.
10.178a Special duty-free treatment for subSaharan African countries.

FLUXING MATERIAL
10.98

Copper-bearing fluxing material.
ETHYL ALCOHOL

10.99 Importation of ethyl alcohol for nonbeverage purposes.
UNITED STATES GOVERNMENT IMPORTATIONS
10.100 Entry, examination, and tariff status.
10.101 Immediate delivery.
10.102 Duty-free entries.
10.103 American goods returned.
10.104 Temporary importation entries for
United States Government agencies.

CANADIAN CRUDE PETROLEUM
10.179 Canadian crude petroleum subject to
a commercial exchange agreement between United States and Canadian refiners.

WHEAT
10.106

[Reserved]

10.107

Equipment and supplies; admission.

RESCUE AND RELIEF WORK

CERTAIN FRESH, CHILLED, OR FROZEN BEEF
10.180

PRODUCTS EXPORTED UNDER LEASE AND
REIMPORTED

Certification.

WATCHES AND WATCH MOVEMENTS FROM U.S.
INSULAR POSSESSIONS

10.108 Entry of reimported articles exported
under lease.

10.181–10.182

[Reserved]
CIVIL AIRCRAFT

STRATEGIC MATERIALS OBTAINED BY BARTER
OR EXCHANGE
10.110

Importations not over $200.
Bona-fide gifts.
Conditions for exemption.

10.183 Duty-free entry of civil aircraft, aircraft engines, ground flight simulators,
parts, components, and subassemblies.

[Reserved]

LATE FILING OF FREE ENTRY AND REDUCED
DUTY DOCUMENTS

Subpart B—Caribbean Basin Initiative

10.112 Filing free entry documents or reduced duty documents after entry.

10.191 General.
10.192 Claim for exemption from duty under
the CBI.
10.193 Imported directly.
10.194 Evidence of direct shipment.
10.195 Country of origin criteria.
10.196 Cost or value of materials produced
in a beneficiary country or countries.
10.197 Direct costs of processing operations
performed in a beneficiary country or
countries.
10.198 Evidence of country of origin.
10.198a Duty reduction for certain leatherrelated articles.
10.198b Products of Puerto Rico processed in
a beneficiary country.
10.199 Duty-free entry for certain beverages
produced in Canada from Caribbean rum.

INSTRUMENTS AND APPARATUS FOR
EDUCATIONAL AND SCIENTIFIC INSTITUTIONS
10.114 General provisions.
10.115–10.119 [Reserved]
VISUAL OR AUDITORY MATERIALS
10.121 Visual or auditory materials of an
educational, scientific, or cultural character.
RATE OF DUTY DEPENDENT UPON ACTUAL USE
10.131 Circumstances in which applicable.
10.132 [Reserved]
10.133 Conditions required to be met.
10.134 Declaration of intent.
10.135 Deposit of duties.
10.136 Suspension of liquidation.
10.137 Records of use.
10.138 Proof of use.
10.139 Liquidation.

Subpart C—Andean Trade Preference
10.201
10.202
10.203

Applicability.
Definitions.
Eligibility criteria in general.

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U.S. Customs and Border Protection, DHS; Treasury
10.204 Imported directly.
10.205 Country of origin criteria.
10.206 Value content requirement.
10.207 Procedures for filing duty-free treatment claim and submitting supporting
documentation.

10.243 Articles eligible for preferential
treatment.
10.244 Certificate of Origin.
10.245 Filing of claim for preferential treatment.
10.246 Maintenance of records and submission of Certificate by importer.
10.247 Verification and justification of
claim for preferential treatment.
10.248 Additional requirements for preferential treatment of brassieres.

Subpart D—Textile and Apparel Articles
Under the African Growth and Opportunity Act
10.211 Applicability.
10.212 Definitions.
10.213 Articles eligible for preferential
treatment.
10.214 Certificate of Origin.
10.215 Filing of claim for preferential treatment.
10.216 Maintenance of records and submission of Certificate by importer.
10.217 Verification and justification of
claim for preferential treatment.

EXTENSION OF ATPA BENEFITS TO TUNA AND
CERTAIN OTHER NON-TEXTILE ARTICLES
10.251 Applicability.
10.252 Definitions.
10.253 Articles eligible for preferential
treatment.
10.254 Certificate of Origin.
10.255 Filing of claim for preferential treatment.
10.256 Maintenance of records and submission of Certificate by importer.
10.257 Verification and justification of
claim for preferential treatment.

Subpart E—United States-Caribbean Basin
Trade Partnership Act
TEXTILE AND APPAREL ARTICLES UNDER THE
UNITED STATES-CARIBBEAN BASIN TRADE
PARTNERSHIP ACT

Subpart G—United States-Canada Free
Trade Agreement

10.221 Applicability.
10.222 Definitions.
10.223 Articles eligible for preferential
treatment.
10.224 Certificate of Origin.
10.225 Filing of claim for preferential treatment.
10.226 Maintenance of records and submission of Certificate by importer.
10.227 Verification and justification of
claim for preferential treatment.
10.228 Additional requirements for preferential treatment of brassieres.

10.301 Scope and applicability.
10.302 Eligibility criteria in general.
10.303 Originating goods.
10.304 Exclusions.
10.305 Value content requirement.
10.306 Direct shipment to the United States.
10.307 Documentation.
10.308 Records retention.
10.309 Verification of documentation.
10.310 Election to average for motor vehicles.
10.311 Documentation for election to average for motor vehicles.

NON-TEXTILE ARTICLES UNDER THE UNITED
STATES-CARIBBEAN BASIN TRADE PARTNERSHIP ACT

Subpart H—United States-Chile Free Trade
Agreement

10.231 Applicability.
10.232 Definitions.
10.233 Articles eligible for preferential tariff
treatment.
10.234 Certificate of Origin.
10.235 Filing of claim for preferential tariff
treatment.
10.236 Maintenance of records and submission of Certificate by importer.
10.237 Verification and justification of
claim for preferential tariff treatment.

GENERAL PROVISIONS
10.401
10.402

Scope.
General definitions.
IMPORT REQUIREMENTS

10.410 Filing of claim for preferential tariff
treatment upon importation.
10.411 Certification of origin or other information.
10.412 Importer obligations.
10.413 Validity of certification.
10.414 Certification or other information
not required.
10.415 Maintenance of records.
10.416 Effect of noncompliance; failure to
provide documentation regarding transshipment.

Subpart F—Andean Trade Promotion and
Drug Eradication Act
APPAREL AND OTHER TEXTILE ARTICLES
UNDER THE ANDEAN TRADE PROMOTION AND
DRUG ERADICATION ACT
10.241
10.242

Pt. 10

Applicability.
Definitions.

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Pt. 10

19 CFR Ch. I (4–1–11 Edition)
GOODS RETURNED AFTER REPAIR OR
ALTERATION

TARIFF PREFERENCE LEVEL
10.420 Filing of claim for tariff preference
level.
10.421 Goods eligible for tariff preference
claims.
10.422 Submission of certificate of eligibility.
10.423 Certificate of eligibility not required.
10.424 Effect of noncompliance; failure to
provide documentation regarding transshipment of non-originating cotton or
man-made fiber fabric or apparel goods.
10.425 Transit and transshipment of nonoriginating cotton or man-made fiber
fabric or apparel goods.

10.490 Goods re-entered after repair or alteration in Chile.

Subpart I—United States-Singapore Free
Trade Agreement
GENERAL PROVISIONS
10.501
10.502

IMPORT REQUIREMENTS
10.510 Filing of claim for preferential tariff
treatment upon importation.
10.511 Supporting statement.
10.512 Importer obligations.
10.513 Supporting statement not required.
10.514 Maintenance of records.
10.515 Effect of noncompliance; failure to
provide documentation regarding third
country transportation.

EXPORT REQUIREMENTS
10.430
10.431

Scope.
General definitions.

Export requirements.
Failure to comply with requirements.

POST-IMPORTATION DUTY REFUND CLAIMS
10.440 Right to make post-importation
claim and refund duties.
10.441 Filing procedures.
10.442 CBP processing procedures.

TARIFF PREFERENCE LEVEL
10.520 Filing of claim for tariff preference
level.
10.521 Goods eligible for tariff preference
level claims.
10.522 Submission of certificate of eligibility.

RULES OF ORIGIN
10.450 Definitions.
10.451 Originating goods.
10.452 Exclusions.
10.453 Treatment of textile and apparel sets.
10.454 Regional value content.
10.455 Value of materials.
10.456 Accessories, spare parts or tools.
10.457 Fungible goods and materials.
10.458 Accumulation.
10.459 De minimis.
10.460 Indirect materials.
10.461 Retail packaging materials and containers.
10.462 Packing materials and containers for
shipment.
10.463 Transit and transshipment.

RULES OF ORIGIN
10.530 Definitions.
10.531 Originating goods.
10.532 Integrated Sourcing Initiative.
10.533 De minimis.
10.534 Accumulation.
10.535 Regional value content.
10.536 Value of materials.
10.537 Accessories, spare parts, or tools.
10.538 Fungible goods and materials.
10.539 Retail packaging materials and containers.
10.540 Packing materials and containers for
shipment.
10.541 Indirect materials.
10.542 Third country transportation.
10.543 Certain apparel goods made from fabric or yarn not available in commercial
quantities.

ORIGIN VERIFICATIONS AND DETERMINATIONS
10.470 Verification and justification of
claim for preferential treatment.
10.471 Special rule for verification in Chile
of U.S. imports of textile and apparel
products.
10.472 Verification in the United States of
textile and apparel goods.
10.473 Issuance of negative origin determinations.
10.474 Repeated false or unsupported preference claims.

ORIGIN VERIFICATIONS AND DETERMINATIONS
10.550 Verification and justification of
claim for preferential treatment.
10.551 Issuance of negative origin determinations.
10.552 Information sharing by CBP regarding textile and apparel goods produced in
the United States.
10.553 Textile and apparel site visits.
10.554 Exclusion of textile or apparel goods
for intentional circumvention.

PENALTIES
10.480 General.
10.481 Corrected declaration by importers.
10.482 Corrected certification of origin by
exporters or producers.
10.483 Framework for correcting declarations and certifications.

PENALTIES
10.560

General.

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10.561 Corrected claim or supporting statement.
10.562 Framework for correcting claims or
supporting statements.

10.609 Transshipment of non-originating
cotton or man-made fiber apparel goods.
10.610 Effect of noncompliance; failure to
provide documentation regarding transshipment of non-originating cotton or
man-made fiber apparel goods.

GOODS RETURNED AFTER REPAIR OR
ALTERATION

ORIGIN VERIFICATIONS AND DETERMINATIONS

10.570 Goods re-entered after repair or alteration in Singapore.

10.616 Verification and justification of
claim for preferential tariff treatment.
10.617 Special rule for verifications in a
Party of U.S. imports of textile and apparel goods.
10.618 Issuance of negative origin determinations.
10.619 Repeated false or unsupported preference claims.

Subpart J—Dominican Republic-Central
America-United States Free Trade
Agreement
GENERAL PROVISIONS
10.581
10.582

Pt. 10

Scope.
General definitions.
IMPORT REQUIREMENTS

PENALTIES

10.583 Filing of claim for preferential tariff
treatment upon importation.
10.584 Certification.
10.585 Importer obligations.
10.586 Certification not required.
10.587 Maintenance of records.
10.588 Effect of noncompliance; failure to
provide documentation regarding transshipment.

10.620 General.
10.621 Corrected claim or certification by
importers.
10.622 Corrected certification by exporters
or producers.
10.623 Framework for correcting claims or
certifications.
GOODS RETURNED AFTER REPAIR OR
ALTERATION

EXPORT REQUIREMENTS

10.624 Goods re-entered after repair or alteration in a Party.

10.589 Certification for goods exported to a
Party.

RETROACTIVE PREFERENTIAL TARIFF
TREATMENT FOR TEXTILE AND APPAREL GOODS

POST-IMPORTATION DUTY REFUND CLAIMS
10.590 Right to make post-importation
claim and refund duties.
10.591 Filing procedures.
10.592 CBP processing procedures.

10.625

Refunds of excess customs duties.

Subpart K—United States-Jordan Free
Trade Agreement

RULES OF ORIGIN

GENERAL PROVISIONS

10.593 Definitions.
10.594 Originating goods.
10.595 Regional value content.
10.596 Value of materials.
10.597 Accumulation.
10.598 De minimis.
10.599 Fungible goods and materials.
10.600 Accessories, spare parts, or tools.
10.601 Retail packaging materials and containers.
10.602 Packing materials and containers for
shipment.
10.603 Indirect materials.
10.604 Transit and transshipment.
10.605 Goods classifiable as goods put up in
sets.

10.701
10.702

Scope.
Definitions.
IMPORT REQUIREMENTS

10.703 Filing of claim for preferential tariff
treatment.
10.704 Declaration.
10.705 Importer obligations.
10.706 Declaration not required.
10.707 Maintenance of records.
10.708 Effect of noncompliance; failure to
provide documentation regarding thirdcountry transportation.
RULES OF ORIGIN
10.709
10.710
10.711

TARIFF PREFERENCE LEVEL
10.606 Filing of claim for tariff preference
level.
10.607 Goods eligible for tariff preference
level claims.
10.608 Submission of certificate of eligibility for certain apparel goods of Nicaragua.

Country of origin criteria.
Value-content requirement.
Imported directly.
ORIGIN VERIFICATIONS

10.712 Verification of claim for preferential
tariff treatment.

Subpart L [Reserved]

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Pt. 10

19 CFR Ch. I (4–1–11 Edition)
IMPORT REQUIREMENTS

Subpart M—United States-Morocco Free
Trade Agreement

10.803 Filing of claim for preferential tariff
treatment upon importation.
10.804 Declaration.
10.805 Importer obligations.
10.806 Declaration not required.
10.807 Maintenance of records.
10.808 Effect of noncompliance; failure to
provide documentation regarding transshipment.

GENERAL PROVISIONS
10.761
10.762

Scope.
General definitions.
IMPORT REQUIREMENTS

10.763 Filing of claim for preferential tariff
treatment upon importation.
10.764 Declaration.
10.765 Importer obligations.
10.766 Declaration not required.
10.767 Maintenance of records.
10.768 Effect of noncompliance; failure to
provide documentation regarding transshipment.

RULES OF ORIGIN
10.809 Definitions.
10.810 Originating goods.
10.811 Textile or apparel goods.
10.812 Accumulation.
10.813 Value of materials.
10.814 Direct costs of processing operations.
10.815 Packaging and packing materials and
containers for retail sale and for shipment.
10.816 Indirect materials.
10.817 Imported directly.

RULES OF ORIGIN
10.769 Definitions.
10.770 Originating goods.
10.771 Textile or apparel goods.
10.772 Accumulation.
10.773 Value of materials.
10.774 Direct costs of processing operations.
10.775 Packaging and packing materials and
containers for retail sale and for shipment.
10.776 Indirect materials.
10.777 Imported directly.

TARIFF PREFERENCE LEVEL
10.818 Filing of claim for tariff preference
level.
10.819 Goods eligible for tariff preference
claims.
10.820 Certificate of eligibility.
10.821 Declaration.
10.822 Transshipment of non-originating
fabric or apparel goods.
10.823 Effect of non-compliance; failure to
provide documentation regarding transshipment of non-originating fabric or apparel goods.

TARIFF PREFERENCE LEVEL
10.778 Filing of claim for tariff preference
level.
10.779 Goods eligible for tariff preference
claims.
10.780 Transshipment of non-originating
fabric or apparel goods.
10.781 Effect of noncompliance; failure to
provide documentation regarding transshipment of non-originating fabric or apparel goods.

ORIGIN VERIFICATIONS AND DETERMINATIONS
10.824 Verification and justification of
claim for preferential treatment.
10.825 Issuance of negative origin determinations.

ORIGIN VERIFICATIONS AND DETERMINATIONS

PENALTIES

10.784 Verification and justification of
claim for preferential treatment.
10.785 Issuance of negative origin determinations.

10.826

GOODS RETURNED AFTER REPAIR OR
ALTERATION

PENALTIES
10.786

10.827 Goods re-entered after repair or alteration in Bahrain.

Violations relating to the MFTA.

Subpart O—Haitian Hemispheric Opportunity through Partnership Encouragement Act of 2006 and 2008

GOODS RETURNED AFTER REPAIR OR
ALTERATION
10.787 Goods re-entered after repair or alteration in Morocco.

10.841 Applicability.
10.842 Definitions.
10.843 Articles eligible for duty-free treatment.
10.844 Value-content requirement.
10.845 Retroactive application of duty-free
treatment for certain apparel articles.
10.846 Imported directly.

Subpart N—United States-Bahrain Free
Trade Agreement
GENERAL PROVISIONS
10.801
10.802

Violations relating to the BFTA.

Scope.
General definitions.

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U.S. Customs and Border Protection, DHS; Treasury
10.847 Filing of claim for duty-free treatment.
10.848 Declaration of compliance.
10.849 Importer obligations.
10.850 Verification of claim for duty-free
treatment.

PENALTIES
10.889

Violations relating to the OFTA.

GOODS RETURNED AFTER REPAIR OR
ALTERATION
10.890 Goods re-entered after repair or alteration in Oman.

Subpart P—United States-Oman Free Trade
Agreement

AUTHORITY: 19 U.S.C. 66, 1202 (General Note
3(i), Harmonized Tariff Schedule of the
United States (HTSUS)), 1321, 1481, 1484, 1498,
1508, 1623, 1624, 3314.
Section 10.17 also issued under 19 U.S.C.
1401a, 1402;
Sections 10.25 and 10.26 also issued under 19
U.S.C. 3592;
Sections 10.41, 10.41a, 10.107 also issued
under 19 U.S.C. 1322;
Section 10.41b also issued under 19 U.S.C.
1202 (Chapter 98, Subchapter III, U.S. Note 3,
HTSUS);
Section 10.53 also issued under 16 U.S.C.
1521, et seq.;
Section 10.59 also issued under 19 U.S.C.
1309, 1317;
Sections 10.61, 10.62, 10.63, 10.64, 10.64a also
issued under 19 U.S.C. 1309;
Sections 10.62a, 10.65 also issued under 19
U.S.C. 1309, 1317, 1555, 1556, 1557, 1646a;
§ 10.62b also issued under 19 U.S.C. 1557;
Sections 10.70, 10.71 also issued under 19
U.S.C. 1486;
Sections 10.80, 10.81, 10.82, 10.83 also issued
under 19 U.S.C. 1313 (e) and (i);
Section 10.91 also issued under Pub. L. 106–
476 (114 Stat. 2101), sections 1434, 1435;
Sections 10.171 through 10.178a also issued
under 19 U.S.C. 2461 et seq.;
Section 10.183 also issued under 19 U.S.C.
1202 (General Note 6, HTSUS);
Sections 10.191 through 10.199 also issued
under 19 U.S.C. 2701 et seq.;
Sections 10.201 through 10.207 also issued
under 19 U.S.C. 3203;
Sections 10.211 through 10.217 also issued
under 19 U.S.C. 3721;
Sections 10.221 through 10.228 and §§ 10.231
through 10.237 also issued under 19 U.S.C.
2701 et seq.
Sections 10.241 through 10.248 and §§ 10.251
through 10.257 also issued under 19 U.S.C.
3203.
Sections 10.401 through 10.490 also issued
under Pub. L. 108–77, 117 Stat. 909 (19 U.S.C.
3805 note).
Sections 10.501 through 10.570 also issued
under 19 U.S.C. 1202 (General Note 25,
HTSUS) and Pub. L. 108–78, 117 Stat. 948 (19
U.S.C. 3805 note).
Sections 10.581 through 10.625 also issued
under 19 U.S.C. 1202 (General Note 29,
HTSUS), 19 U.S.C. 1520(d), and Pub. L. 109–53,
119 Stat. 462 (19 U.S.C. 4001 note).
Section 10.699 also issued under Pub. L.
109–53, 119 Stat. 462.
Sections 10.701 through 10.712 also issued
under 19 U.S.C. 1202 (General Note 18,

GENERAL PROVISIONS
10.861
10.862

Pt. 10

Scope.
General definitions.
IMPORT REQUIREMENTS

10.863 Filing of claim for preferential tariff
treatment upon importation.
10.864 Declaration.
10.865 Importer obligations.
10.866 Declaration not required.
10.867 Maintenance of records.
10.868 Effect of noncompliance; failure to
provide documentation regarding transshipment.
POST-IMPORTATION DUTY REFUND CLAIMS
10.869 Right to make post-importation
claim and refund duties.
10.870 Filing procedures.
10.871 CBP processing procedures.
RULES OF ORIGIN
10.872 Definitions.
10.873 Originating goods.
10.874 Textile or apparel goods.
10.875 Accumulation.
10.876 Value of materials.
10.877 Direct costs of processing operations.
10.878 Packaging and packing materials and
containers for retail sale and for shipment.
10.879 Indirect materials.
10.880 Imported directly.
TARIFF PREFERENCE LEVEL
10.881 Filing of claim for tariff preference
level.
10.882 Goods eligible for tariff preference
claims.
10.883 [Reserved]
10.884 Declaration.
10.885 Transshipment of non-originating apparel goods.
10.886 Effect of non-compliance; failure to
provide documentation regarding transshipment of non-originating apparel
goods.
ORIGIN VERIFICATIONS AND DETERMINATIONS
10.887 Verification and justification of
claim for preferential treatment.
10.888 Issuance of negative origin determinations.

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§ 10.1

19 CFR Ch. I (4–1–11 Edition)

HTSUS) and Pub. L. 107–43, 115 Stat. 243 (19
U.S.C. 2112 note).
Sections 10.761 through 10.789 also issued
under Pub. L. 108–302, 118 Stat. 1103 (19 U.S.C.
3805 note).
Sections 10.801 through 10.829 also issued
under 19 U.S.C. 1202 (General Note 30,
HTSUS) and Pub. L. 109–169, 119 Stat. 3581 (19
U.S.C. 3805 note).
Sections 10.841 through 10.850 also issued
under 19 U.S.C. 2703A.
Sections 10.861 through 10.890 also issued
under 19 U.S.C. 1202 (General Note 31,
HTSUS) and Pub. L. 109–283, 120 Stat. 1191 (19
U.S.C. 3805 note).

section or elsewhere in this part or in
§ 145.35 of this chapter, the following
documents shall be filed in connection
with the entry of articles in a shipment
valued over $2,000 and claimed to be
free of duty under subheading 9801.00.10
or 9802.00.20, Harmonized Tariff Schedule of the United States (HTSUS):
(1) A declaration by the foreign shipper in substantially the following form:
I, lllllllllll,
declare that to the best of my knowledge and
belief the articles herein specified were exported from the United States, from the port
of
llllllll
on
or
about
llllllll, 19ll, and that they are returned without having been advanced in
value or improved in condition by any process of manufacture or other means.

SOURCE: 28 FR 14663, Dec. 31, 1963, unless
otherwise noted.

Subpart A—General Provisions
ARTICLES EXPORTED AND RETURNED
§ 10.1 Domestic
products;
requirements on entry.
(a) Except as otherwise provided for
in paragraph (g), (h), (i) or (j) of this
Marks

Number

Quantity

Description

Value, in U.S. coin

..........................
..........................
..........................
..........................
..........................
(Date)
..........................
(Address)

..........................
..........................
..........................
..........................
..........................

........................................................
........................................................
........................................................
........................................................

........................................................
........................................................
........................................................
........................................................
........................................................
(Signature)
........................................................
(Capacity)

..........................

the articles were not manufactured or produced in the United States under subheading
9813.00.05, HTSUS, and that the articles were
exported from the United States without
benefit of drawback.
llllllllllllllllllllllll
(Date)
llllllllllllllllllllllll
(Address)
llllllllllllllllllllllll
(Signature)
llllllllllllllllllllllll
(Capacity)

(2) A declaration by the owner, importer, consignee, or agent having
knowledge of the facts regarding the
claim for free entry. If the owner or ultimate consignee is a corporation, such
declaration may be signed by the president, vice president, secretary, or
treasurer of the corporation, or may be
signed by any employee or agent of the
corporation who holds a power of attorney executed under the conditions outlined in subpart C, part 141 of this
chapter and a certification by the corporation that such employee or other
agent has or will have knowledge of the
pertinent facts. This declaration shall
be in substantially the following form:

(b) In any case in which the value of
the returned articles exceeds $2,000 and
the articles are not clearly marked
with the name and address of the U.S.
manufacturer, the port director may
require, in addition to the declarations
required in paragraph (a) of this section, such other documentation or evidence as may be necessary to substantiate the claim for duty-free treatment. Such other documentation or

I, lllllll,
declare that the (above) (attached) declaration by the foreign shipper is true and correct to the best of my knowledge and belief,
that the articles were manufactured by
llllllll (name of manufacturer) located in llllllll (city and state), that

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U.S. Customs and Border Protection, DHS; Treasury
evidence may include a statement from
the U.S. manufacturer verifying that
the articles were made in the United
States, or a U.S. export invoice, bill of
lading or airway bill evidencing the
U.S. origin of the articles and/or the
reason for the exportation of the articles.
(c) A certificate from the master of a
vessel stating that products of the
United States are returned without
having been unladen from the exporting vessel may be accepted in lieu of
the declaration of the foreign shipper
required by paragraph (a)(1) of this section.
(d) If the port director is reasonably
satisfied, because of the nature of the
articles or production of other evidence, that the articles are imported in
circumstances meeting the requirements of subheading 9801.00.10 or
9802.00.20, HTSUS, and related section
and additional U.S. notes, he may
waive the requirements for producing
the documents specified in paragraph
(a) of this section.
(e) No evidence relative to the conditions of subheading 9801.00.10, HTSUS,
shall be required in the case of articles
the product of the U.S. in use at the
time of importation as the usual coverings or containers of merchandise
not subject to an ad valorem rate of
duty unless such articles would be dutiable if not products of the U.S. under
General Rule of Interpretation 5,
HTSUS.
(f) In the case of photographic films
and dry plates manufactured in the
United States (except motion picture
films to be used for commercial purposes) exposed abroad and entered
under subheading 9802.00.20, HTSUS,
the requirements of paragraphs (a) and
(c) of this section are applicable except
that the declaration by the foreign
shipper provided for in paragraph (a)(1)
to the effect that the articles ‘‘are returned without having been advanced
in value or improved in condition by
any process of manufacture or other
means’’ shall be crossed out, and the
entrant shall show on the declaration
provided for in paragraph (a)(2) that
the subject articles when exported were
of U.S. manufacture and are returned
after having been exposed, or exposed
and developed, and, in the case of mo-

§ 10.1

tion picture films, that they will not be
used for commercial purposes.
(g) Aircraft and aircraft parts and
equipment. (1) In the case of aircraft
and aircraft parts and equipment returned to the United States under subheading 9801.00.10, HTSUS, by or for the
account of an aircraft owner or operator and intended for use in his own
aircraft operations, within or outside
the United States, the entry summary
may be made on Customs Form 3311.
The entry summary on Customs Form
3311 shall be executed by the entrant
and supported by the entry documentation required by § 142.3 of this chapter.
If the Customs officer is satisfied that
the articles are products of the United
States, that they have not been improved in condition or advanced in
value while abroad, and that no drawback has been or will be paid, the other
documents described in this section
shall not be required, and no bond need
be filed for their production.
(2) The entrant shall show on Customs Form 3311:
(i) The name and address of the aircraft owner or operator by whom or for
whose account the articles are returned to the United States, in the
block headed ‘‘Articles Returned To
(Name and Address)’’,
(ii) The name of the importing vessel
or conveyance,
(iii) The date of its arrival,
(iv) A description of the articles,
(v) The value of the articles, and
(vi) That the articles are intended for
use by the aircraft owner or operator
in his own aircraft operations.
(3) If Customs Form 3311 is filed at
time of entry, it shall serve as both the
entry and the entry summary.
(h) Nonconsumable vessel stores and
equipment.
(1)
In
the
case
of
nonconsumable vessel stores and equipment returned to the United States
under subheading 9801.00.10, HTSUS,
the entry summary may be made on
Customs Form 3311. The entry summary on Customs Form 3311 shall be
executed in duplicate by the entrant
and supported by the entry documentation required by § 142.3 of this chapter.
Before an entry summary on Customs
Form 3311 may be accepted for

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§ 10.1

19 CFR Ch. I (4–1–11 Edition)

nonconsumable vessel stores and equipment, the Customs officer shall be satisfied that:
(i) The articles are products of the
United States.
(ii) The articles have not been improved in condition or advanced in
value while abroad.
(iii) No drawback has been or will be
paid, and
(iv) No duty equal to an internal revenue tax is payable under subheading
9801.00.80, HTSUS.
(2) The documentation described in
paragraph (a) of this section shall not
be required in connection with an
entry for nonconsumable vessel stores
and equipment on Customs Form 3311.
(3) To satisfy the Customs officer
that no drawback has been or will be
paid on the articles in connection with
their removal from the United States,
the master of the vessel or other person having knowledge of the facts shall
furnish a written declaration which
may be made on the reverse side of
Customs Form 3311 showing that the
articles were:
(i) Exported as stores or equipment
on a United States vessel or a vessel
operated by the United States Government,
(ii) Not landed in a foreign country,
except for any needed repairs, adjustments, or refilling and return to the
vessel from which landed or,
(iii) For transshipment as stores or
equipment to another vessel.
(4) The entrant also shall show:
(i) The name of the importing vessel,
(ii) The date of its arrival,
(iii) A description of the articles, and
(iv) The value of the articles.
(5) If Customs Form 3311 is filed at
time of entry, it shall serve as both the
entry and the entry summary.
(i) When the total value of articles of
claimed American origin contained in
any shipment does not exceed $250 and
such articles are found to be unquestionably products of the United States
and do not appear to have been advanced in value or improved in condition while abroad and no quota is involved, free entry thereof may be made
under subheading 9801.00.10 on Customs
Form 3311, executed by the owner, importer, consignee, or agent and filed in
duplicate, without regard to the re-

quirement of filing the documentation
provided for in paragraph (a) of this
section, unless the Customs officer has
reason to believe that Customs drawback or exemption from internal revenue tax, or both, were probably allowed on exportation of the articles or
that they are otherwise subject to
duty. The entrant shall show on Customs Form 3311 the name of the importing conveyance, the date of its arrival, the name of the country from
which the articles were returned to the
United States, and the value of the articles. The entrant shall also produce
evidence of his right to make entry (except as provided in § 141.11(b) of this
chapter). If the Customs officer is not
entirely certain that the articles to be
entered under this paragraph by a
nominal consignee are products of the
United States, the actual owner or ultimate consignee thereof may be required to execute a Customs Form 3311.
(j) In the case of products of the
United States, when the aggregate
value of the shipment does not exceed
$10,000 and the products are imported—
(1) For the purposes of repair or alteration, prior to reexportation, or
(2) After having been either rejected
or returned by the foreign purchaser to
the United States for credit, free entry
thereof may be made under subheading
9801.00.10, HTSUS, on Customs Form
3311 (a Customs Form 7501 must be submitted as well for such articles as provided in § 143.23(h) of this chapter), executed by the owner, importer, consignee, or agent and filed in duplicate,
without regard to the requirement of
filing the documentation provided for
in paragraph (a) of this section, unless
the Customs officer has reason to believe that Customs drawback or exemption from internal revenue tax, or
both, were probably allowed on exportation of the articles or that they are
otherwise subject to duty. The person
making entry shall show on Customs
Form 3311 the name of the importing
conveyance, the date of its arrival, the
name of the country from which the articles were returned to the United
States, and the value of the articles.
The person making entry shall also
produce evidence of his right to make
entry (except as provided in § 141.11(b)
of this chapter). If the Customs officer

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U.S. Customs and Border Protection, DHS; Treasury

§ 10.3

the manufacture of the returned article
at the rate or rates applicable to such
foreign merchandise on the date of importation of the returned article (see
paragraph (b) of this section), and
(2) If there is any likelihood that a
refund or remission of tax was allowed
on the exportation of the returned article, the amount of any internal-revenue tax which would be payable at the
time of importation if the returned article were wholly of foreign origin, but
in no such case shall there be assessed
more than an amount equal to the duty
and tax that would apply if the returned article were wholly of foreign
origin and originally imported. (See
§ 10.7(a).) Except as provided for in
§ 10.1(f), if the imported article is of a
kind which would be subject to an internal-revenue tax if of foreign origin
and payment of an internal-revenue
tax before exportation without refund
thereof is not established, duty shall be
assessed on the imported article in an
amount equal to the internal-revenue
tax imposed at the time of entry for
consumption or withdrawal from warehouse for consumption on like articles
of foreign origin, plus the amount of
any drawback allowed on the exportation of the article from the United
States; but if no drawback was allowed,
the duty equal to internal-revenue tax
shall be the total duty to be assessed.
If an allowance of drawback on the exportation from the United States of the
imported article is established, duty
shall be assessed in an amount equal to
such drawback, plus an amount equal
to any internal-revenue tax which may
be assessable in accordance with this
paragraph; but in no case shall duty
equal to drawback, or to drawback and
internal-revenue tax, be assessed in an
amount in excess of the ordinary Customs duty and internal-revenue tax applicable to like articles of foreign origin. In any case, where payment of internal-revenue tax before exportation
without refund thereof is established,
no duty equal to an internal-revenue
tax currently in force shall be assessed.
(b) In the absence of satisfactory evidence as to the nonallowance of drawback or the amount thereof allowed on
the following articles of American
manufacture or production, duty shall

is not entirely certain that the articles
to be entered under this paragraph by a
nominal consignee are products of the
United States, the actual owner or ultimate consignee thereof may be required to execute a Customs Form 3311.
[T.D. 72–119, 37 FR 8867, May 2, 1972]
EDITORIAL NOTE: For FEDERAL REGISTER citations affecting § 10.1, see the List of CFR
Sections Affected, which appears in the
Finding Aids section of the printed volume
and at www.fdsys.gov.

§ 10.3 Drawback; internal-revenue tax.
(a) Except as prescribed in § 10.1(f) or
in paragraphs (c) and (f) of this section,
no free entry shall be allowed under
Chapter 98, Subchapter 1, Harmonized
Tariff Schedule of the United States
(HTSUS), in the final liquidation of an
entry unless the port director is satisfied by the certificate of exportation or
other evidence or information that no
drawback was allowed in connection
with the exportation from the United
States, and unless no internal-revenue
tax is imposed on the importation of
like articles not previously exported
from the United States or, if such tax
is being imposed at the time of entry
for consumption or withdrawal from
warehouse for consumption, the port
director is satisfied that an internalrevenue tax on production or importation was paid in respect of the imported article before it was exported
from the United States and was not refunded. Except as provided for in
§ 10.1(f), when it is impracticable, because of the destruction of Customs
records or other circumstances, to determine whether drawback was allowed, or the amount of drawback allowed, with respect to an article established to be a returned product of the
United States which has not been advanced in value or improved in condition while abroad, there shall be assessed on the returned article an
amount of duty determined as follows:
(1) If there is any likelihood that
drawback was allowable on the exportation of like articles at any time when
the imported article may have been exported from the United States, the estimated amount of any drawback
which would have been allowable if
duty had been paid on any foreign merchandise likely to have been used in

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§ 10.4

19 CFR Ch. I (4–1–11 Edition)

be assessed thereon in the amounts respectively
indicated,
the
amount
shown in each case being considered

the fair average amount of drawback
allowed on such articles:

Article

Duty assessment

Drums, metal (when not exempted from duty in accordance with sec. 10.3(c)) ...............
Hosiery, nylon .....................................................................................................................
Lead compound, tetraethyl .................................................................................................
Lithopone ............................................................................................................................
Oxide, zinc ..........................................................................................................................
Piece goods, cotton:
Bleached ......................................................................................................................
Dyed ............................................................................................................................
Printed .........................................................................................................................
Piece goods, nylon: Dyed
Piece goods, rayon:
Printed .........................................................................................................................
Other than printed (white, piece dyed or yarn dyed) ..................................................
Tallow, refined, inedible ......................................................................................................

(c) The following articles shall be admitted free of duty, even though exported from the United States with
benefit of drawback:
(1) Any article of a kind which would
be admitted free of duty otherwise
than under Chapter 98, Subchapter 1,
HTSUS, if of foreign origin;
(2) Substantial containers or holders
of domestic manufacture, including
shooks and staves when returned as
boxes or barrels, when in use at the
time of importation as the usual containers of merchandise;
(3) Any article provided for in subheadings 9801.00.70 or 9801.00.80, HTSUS,
with respect to which the port director
has determined that the collection of
duty under such subheadings 9801.00.70
or 9801.00.80, HTSUS, would involve an
expense and inconvenience to the Government disproportionate to the probable amount of such duty; and
(4) Other articles of domestic manufacture which are in use at the time of
importation as the usual coverings or
containers of merchandise not subject
to an ad valorem rate of duty, and
which have not been advanced in value
or improved in condition while abroad
by any process of manufacture or other
means.
(d) Articles manufactured or produced in the United States in a Customs bonded warehouse and exported
shall be subject on reimportation to a
duty equal to the total duty and internal-revenue tax, if any, imposed at the
time of entry for consumption or withdrawal from warehouse for consump-

24 cents each.
45 cents per dozen.
$0.003 per kilogram.
$0.00065 per kilogram.
$0.0029 per kilogram.
$0.03199
$0.03454
$0.03226
$0.29086

per
per
per
per

square
square
square
square

meter.
meter.
meter.
meter.

$0.04867 per square meter.
$0.08478 per square meter.
$0.003 per kilogram.

tion with respect to the importation of
like articles not previously exported
from the United States.
(e) Animals straying across the border or driven across the border for pasturage purposes or for feeding to improve them for the market and not returned within 8 months are excluded
from free entry as domestic products
returned.
(f) Tobacco products and cigarette
papers and tubes classifiable under subheading 9801.00.80, HTSUS, may be released from customs custody without
the payment of that part of the duty
attributable to the internal-revenue
tax for return to internal-revenue bond
as provided by section 5704(d) of the Internal Revenue Code of 1954.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 68–104, 33 FR 5616, Apr. 11, 1968; T.D. 83–
240, 48 FR 53098, Nov. 25, 1983; T.D. 89–1, 53 FR
51246, Dec. 21, 1988; T.D. 93–66, 58 FR 44130,
Aug. 19, 1993]

§ 10.4

Internal-revenue marks; erasure.

Internal-revenue brands or marks on
casks or other containers previously
exported from the United States must
be erased at the importer’s expense
under Customs supervision before their
delivery from Customs custody.
§ 10.5 Shooks and staves; cloth boards;
port director’s account.
(a) Shooks and staves produced in the
United States and returned in the form
of complete boxes or barrels in use as
the usual containers of merchandise
are exempt from any duties imposed by

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U.S. Customs and Border Protection, DHS; Treasury
the tariff laws upon similar containers
made of foreign shooks or staves, provided their identity is established
under the regulations in this part.
(b) The term ‘‘shook’’ embraces only
shooks which at the time of exportation from this country are ready to
be assembled into boxes or barrels
without further cutting to size; except
that box shooks may be exported in
double lengths and cut abroad. The
number of boxes made from such
shooks which may be imported into
this country free of duty cannot exceed
the number of complete sets of shooks
exported.
(c) [Reserved]
(d) An exporter of shooks or staves in
respect of which free entry is to be
claimed when returned as boxes or barrels shall file in triplicate with the director of the port of exportation, at
least 6 hours before the landing of the
articles on the exporting vessel, a Certificate of Registration, Customs Form
4455.
(e) The Certificate of Registration,
CF 4455, shall be completed in triplicate by the port director after
verification from the manifest of the
exporting vessel and the return of the
lading officer. The original shall be forwarded by the port director to the consignee. The duplicate copy shall be
given to the exporter and the triplicate
copy shall be retained.
(f) Whenever boxes or barrels alleged
to have been manufactured from American shooks or staves are shipped to
the United States from a person abroad
other than the one to whom they were
exported from the United States, the
importer shall be required to obtain
from the foreign consignee to whom
the shooks or staves were originally
exported from this country the certificate or certificates, Customs Form
4455, covering the exportation of the
shooks or staves from the United
States, or an extract therefrom signed
by such consignee, showing the number
of shooks or staves covered by such
certificate or certificates, together
with the number of superficial feet of
such shooks or staves. Such Form 4455,
or extract therefrom, shall be filed by
the importer in connection with the
entry of the boxes or barrels.

§ 10.6

(g) Accounts shall be kept by the director of the port of exportation of the
shooks and staves as to each exportation thereof and as to the returns
thereof in boxes, barrels, etc. Notifications of such returns shall be given to
the port of exportation by the director
of the port of importation. When returns in the form of boxes, barrels,
etc., entirely account for the shooks
and staves exported as shown on the
appropriate Customs Form 4455, the
port director maintaining the account
shall so inform the port director making inquiry about the merchandise
being imported and alleged to contain
shooks or staves covered by the particular exportation.
(h) A record of cloth boards of domestic manufacture exported to be
wrapped with foreign textiles shall be
kept by the port director in a similar
manner as for shooks and staves. Cloth
boards of domestic manufacture are
conditionally free of duty under Chapter 98, subchapter 1, Harmonized Tariff
Schedule
of
the
United
States
(HTSUS). If such boards are advanced
in value or improved in condition while
abroad, free entry shall be denied on
importation.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 78–99, 43 FR 13060, Mar. 29, 1978; T.D. 89–
1, 53 FR 51247, Dec. 21, 1988; T.D. 98–52, 63 FR
29954, June 2, 1998]

§ 10.6 Shooks and staves; claim for
duty exemption.
An importer, seeking an exemption
from duty on account of boxes or barrels made from American shooks or
staves, must make such a claim on
Customs Form 4455 at the time of filing
the entry. Upon receipt, from the director of the port of exportation of the
shooks and staves, of corroboration
that the records of exportation do not
conflict materially with such a claim,
the exemption may be allowed. If the
claim for an exemption is disallowed in
full or in part, the importer may file a
request within 15 days of the date of
the port director’s notice to him of any
disallowance, for referral of the question to the Commissioner of Customs
for review.
[T.D. 87–75, 52 FR 20066, May 29, 1987, as
amended by T.D. 98–52, 63 FR 29954, June 2,
1998]

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§ 10.7

19 CFR Ch. I (4–1–11 Edition)
verified. The procedure in the last two
sentences of § 10.6 shall be applicable.
(e) If claim for exemption from duty
for such containers or holders of foreign production previously imported
duty paid is made at the time of entry,
the certificate of the foreign shipper
may be accepted if produced at any
time prior to the liquidation of the
entry.
(f) When such containers or holders
of foreign production previously imported duty paid are reimported empty,
they may be admitted without entry if
readily identifiable as having been previously imported duty paid.

§ 10.7 Substantial containers or holders.
(a) Substantial containers or holders,
which are products of the United
States, which are of the usual and ordinary types used in the shipment or
transportation of goods, which are reusable for such purposes, and which are
imported containing or holding merchandise, shall be entered under the
general regulations governing the free
entry of domestic products exported
and returned. When such containers or
holders are imported not containing or
holding merchandise they may be admitted without entry if readily identifiable as products of the United States.
(b) Substantial containers or holders,
which are of foreign production and
previously imported duty paid, which
are of the usual or ordinary types used
in the shipment or transportation of
goods, which are reusable for such purpose, and which are imported containing or holding merchandise, shall
be exempt from duty if (1) exported in
accordance with the regulations contained in § 10.5 (d) and (e), and (2) there
is filed in connection with the entry a
certificate of the foreign shipper in the
form prescribed by paragraph (c) of this
section.
(c) The certificate to be furnished by
the foreign shipper for the use of the
director of the port of entry shall be in
the following form:

[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 82–145, 47 FR 35475, Aug. 16, 1982; T.D. 86–
118, 51 FR 22515, June 20, 1986; T.D. 97–82, 62
FR 51769, Oct. 3, 1997]

§ 10.8 Articles exported for repairs or
alterations.
(a) Except as otherwise provided for
in this section and except in the case of
goods covered by § 181.64 of this chapter, the following documents shall be
filed in connection with the entry of
articles which are returned after having been exported for repairs or alterations and which are claimed to be subject to duty only on the value of the repairs or alterations performed abroad
under
subheading
9802.00.40
or
9802.00.50, Harmonized Tariff Schedule
of the United States (HTSUS):
(1) A declaration from the person who
performed such repairs or alterations,
in substantially the following form:

I, llllllll, of llllllll, do
hereby certify that to the best of my knowledge and belief the substantial containers
and holders mentioned in (the annexed invoice) (invoice No. llll of llll, 19ll)
* are of the manufacture of llllllll
and were exported from the United States at
the
port
of
llllll,
per
S.S.
llllllll on lllll, 19ll, and that
the same are being returned to the United
States (empty) filled with llll) (holdings
lllllll).*
———————————————————————
Shipper

I,llllllll, declare that the articles
herein specified are the articles which, in the
condition in which they were exported from
the United States, were received by me (us)
on
llllllll,
19ll,
fromllllllll (name and address of
owner or exporter in the United States); that
they were received by me (us) for the sole
purpose of being repaired or altered; that
only the repairs or alterations described
below were performed by me (us); that the
full cost or (when no charge is made) value of
such repairs or alterations are correctly
stated below; and that no substitution whatever has been made to replace any of the articles originally received by me (us) from the
owner or exporter thereof mentioned above.

(d)
The
port
director,
after
verification of the foreign shipper’s
certificate with the records of the director of the port of exportation in this
country, shall allow free entry to the
extent the basis for such allowance is
* Cross out inapplicable words.

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U.S. Customs and Border Protection, DHS; Treasury

Marks and numbers

Description
of articles
and of repairs or alterations

Full cost or
(when no
charge is
made)
value of
repairs or
alterations
(see subchapter II,
chapter 98,
HTSUS)

§ 10.8a

dence, that the articles are imported
under circumstances meeting the requirements of subheading 9802.00.40 or
9802.00.50, HTSUS, and related section
and additional U.S. notes, he may
waive submission of the declarations
provided for in paragraph (a) of this
section.
(d) The port director shall require at
the time of entry a deposit of estimated duties based upon the full cost
or value of the repairs or alterations.
The cost or value of the repairs or alterations outside the United States,
which is to be set forth in the invoice
and entry papers as the basis for the
assessment of duty under subheading
9802.00.40 or 9802.00.50, HTSUS, shall be
limited to the cost or value of the repairs or alterations actually performed
abroad, which will include all domestic
and foreign articles furnished for the
repairs or alterations but shall not include any of the expenses incurred in
this country whether by way of engineering costs, preparation of plans or
specifications, furnishing of tools or
equipment for doing the repairs or alterations abroad, or otherwise.

Total value
of articles
after repairs or alterations

llllllllllllllllllllllll
(Date)
llllllllllllllllllllllll
(Address)
llllllllllllllllllllllll
(Signature)
llllllllllllllllllllllll
(Capacity)

(2) A declaration by the owner, importer, consignee, or agent having
knowledge of the pertinent facts in
substantially the following form:
I, lllll,
declare that the (above) (attached) declaration by the person who performed the repairs
or alterations abroad is true and correct to
the best of my knowledge and belief; that the
articles were not manufactured or produced
in the United States under subheading
9813.00.05, HTSUS; that such articles were exported from the United States for repairs or
alterations and without benefit of drawback
from
llllllll
(port)
on
llllllll, 19ll; and that the articles
entered in their repaired or altered condition
are the same articles that were exported on
the above date and that are identified in the
(above) (attached) declaration.
llllllllllllllllllllllll
(Date)
llllllllllllllllllllllll
(Address)
llllllllllllllllllllllll
(Signature)
llllllllllllllllllllllll
(Capacity)

[T.D. 94–47, 59 FR 25567, May 17, 1994, as
amended by T.D. 95–68, 60 FR 46361, Sept. 6,
1995]

§ 10.8a Imported articles exported and
reimported.
(a) In addition to regular entry procedures, supplementary documentation
is required in connection with dutyfree entries under subheading 9801.00.25,
Harmonized Tariff Schedule of the
United States (19 U.S.C. 1202), of articles which were originally entered duty
paid, removed from Customs custody,
and subsequently exported, if:
(1) The articles were exported within
3 years after the date of the previous
importation.
(2) The articles were not advanced in
value or improved in condition by any
process of manufacture or other means
while abroad.
(3) The articles did not conform to
sample or specifications abroad.
(4) The articles are reimported by or
for the account of the person who imported them into and exported them
from the United States.
(b) The following supplementary documents shall be filed in connection

(b) The port director may require
such additional documentation as is
deemed necessary to prove actual exportation of the articles from the
United States for repairs or alterations, such as a foreign customs
entry, foreign customs invoice, foreign
landing certificate, bill of lading, or an
airway bill.
(c) If the port director concerned is
satisfied, because of the nature of the
articles or production of other evi-

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§ 10.9

19 CFR Ch. I (4–1–11 Edition)

with the entry of articles claimed to be
free
of
duty
under
subheading
9801.00.25, Harmonized Tariff Schedule
of the United States:
(1) A declaration by the person
abroad who received and is returning
the merchandise to the United States,
in substantially the following form:
I declare that thelllllllllll (Description of articles) were received by me
from lllllllllllllllll (Name
and address of U.S. exporter), that they have
not been advanced in value or improved in
condition by any process of manufacture or
other means and are being returned to
llllllllllllllll(Name and address of consignee in the United States) because they do not conform to sample or specifications for the following reasons:
llllllllllllllllllllllll
llllllllllllllllllllllll
llllllllllllllllllllllll
llllllllllllllllllllllll
(Date)
(Signature)
llllllllllllllllllllllll
(Address)
(Title)

(2) A declaration by the owner, importer, consignee, or agent, in substantially the following form:
I declare that the lllllllllll
(Description of articles) were previously imported into the United States at the Port of
llllllll (Name of port), Entry
No.lll, on lllllll (Date of entry) by
lllllllllll (Name and address of
importer) at which time duty was paid; that
they were exported from the United States
at the Port of llllllll (Name of port)
on llllllllll (Date of exportation)
by lllllllllll (Name and address
of exporter) without benefit of drawback;
that the articles are being reimported by or
for the account of llllllll, and, that
the
attached
declaration
from
llllllllllllllll (Name of foreign shipper) is correct in every respect.
llllllllllllllllllllllll
(Date)
(Signature)
llllllllllllllllllllllll
(Address)
(Title)

(c) If the port director concerned is
reasonably satisfied because of the nature of the articles or production of
other evidence that the requirements
of subheading 9801.00.25, Harmonized
Tariff Schedule of the United States,
and the related section and additional
U.S. notes have been met, he may
waive the production of the documents

provided for in paragraph (b) of this
section.
[T.D. 72–221, 37 FR 17469, Aug. 29, 1972, as
amended by T.D. 89–1, 53 FR 51247, Dec. 21,
1988]

§ 10.9

Articles exported for processing.

(a) Except as otherwise provided for
in this section, the following documents shall be filed in connection with
the entry of articles which are returned after having been exported for
further processing and which are
claimed to be subject to duty only on
the value of the processing performed
abroad under subheading 9802.00.60,
Harmonized Tariff Schedule of the
United States (HTSUS):
(1) A declaration by the person who
performed the processing abroad, in
substantially the following form:
I, lllll, declare that the articles herein specified are the articles which, in the
condition in which they were exported from
the United States, were received by me (us)
on
llllll,
19
lll,
from
llllllll (name and address of owner
or exporter in the United States); that they
were received by me (us) for the sole purpose
of being processed; that only the processing
described below was effected by me (us); that
the full cost or (when no charge is made)
value of such processing and the value of the
articles after processing are correctly stated
below; and that no substitution whatever has
been made to replace any of the articles
originally received by me (us) from the
owner or exporter thereof mentioned above.

Marks and numbers

Description
of articles
and of
processing

Full cost or
(when no
charge is
made)
value of
processing
(see subchapter II,
chapter 98,
HTSUS)

llllllllllllllllllllllll
(Date)
llllllllllllllllllllllll
(Address)
llllllllllllllllllllllll
(Signature)
llllllllllllllllllllllll
(Capacity)

(2) A declaration by the owner, importer, consignee, or agent having

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U.S. Customs and Border Protection, DHS; Treasury
knowledge of the pertinent facts in
substantially the following form:
I, lllll, declare that the (above) (attached) declaration by the person who performed the processing abroad is true and
correct to the best of my knowledge and
belief; that the articles were manufactured
in the United States by llllllll
(name and address) or, if of foreign origin,
were subjected to llllllll (show
processes of manufacture, such as molding,
casting, machining) in the United States
by llllllll (name and address); that
the articles were not manufactured or produced in the United States under subheading 9813.00.05, HTSUS; that the articles were exported for processing and without
benefit
of
drawback
from
llllllll (port) on llllll, 19
lll; that the articles entered in their
processed condition are otherwise the same
articles that were exported on the above
date and that are identified in the (above)
(attached) declaration; and that the returned articles will be subjected to
llllllll (describe processing to be
performed in the United States) by
llllllll (name and address of U.S.
processor).
llllllllllllllll
llllllllllllllllllllllll
(Date)
llllllllllllllllllllllll
(Address)
llllllllllllllllllllllll
(Signature)
llllllllllllllllllllllll
(Capacity)

(b) The port director may require
such additional documentation as is
deemed necessary to prove actual exportation of the articles from the
United States for processing, such as a
foreign customs entry, foreign customs
invoice, foreign landing certificate, bill
of lading, or an airway bill.
(c) If the port director concerned is
satisfied, because of the nature of the
articles or production of other evidence, that the articles are imported
under circumstances meeting the requirements of subheading 9802.00.60,
HTSUS, and related section and additional U.S. notes, he may waive submission of the declarations provided
for in paragraph (a) of this section.
(d) The port director shall require at
the time of entry a deposit of estimated duties based upon the full cost
or value of the processing. The cost or
value of the processing outside the
United States, which is to be set forth

§ 10.11

in the invoice and entry papers as the
basis for the assessment of duty under
subheading 9802.00.60, HTSUS, shall be
limited to the cost or value of the processing actually performed abroad,
which will include all domestic and foreign articles used in the processing but
shall not include the exported United
States metal article or any of the expenses incurred in this country whether by way of engineering costs, preparation of plans or specifications, furnishing of tools or equipment for doing
the processing abroad, or otherwise.
[T.D. 94–47, 59 FR 25568, May 17, 1994]

§ 10.10

[Reserved]

ARTICLES ASSEMBLED ABROAD WITH
UNITED STATES COMPONENTS
§ 10.11 General.
(a) Sections 10.12 through 10.23 set
forth definitions and interpretative
regulations adopted by the Commissioner of Customs pertaining to the
construction of subheading 9802.00.80,
Harmonized Tariff Schedule of the
United States (19 U.S.C. 1202) and related provisions of law. These provisions concern claims for the exemption
from duty provided by subheading
9802.00.80, Harmonized Tariff Schedule
of the United States (19 U.S.C. 1202), for
American-made fabricated components
which are returned to the United
States as parts of articles assembled
abroad. The examples included in these
sections describe specific situations in
which the exemption may or may not
be applicable. The definitions and regulations that follow are promulgated to
inform the public of the constructions
and interpretations that the United
States Customs Service shall give to
relevant statutory terms and to assure
the impartial and uniform assessment
of duties upon merchandise claimed to
be partially exempt from duty under
subheading 9802.00.80, Harmonized Tariff Schedule of the United States (19
U.S.C. 1202), at the various ports of
entry. Nothing in these regulations
purports or is intended to restrict the
legal right of importers or others to a
judicial review of the matters contained therein.
(b) Section 10.24 sets forth the documentary requirements applicable to

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§ 10.12

19 CFR Ch. I (4–1–11 Edition)

the entry of assembled articles claimed
to be subject to the exemption provided
under
subheading
9802.00.80,
Harmonized Tariff Schedule of the United
States (19 U.S.C. 1202). Allowance of an
importer’s claim is dependent upon
meeting the statutory requirements for
the
exemption
under
subheading
9802.00.80, Harmonized Tariff Schedule
of the United States (19 U.S.C. 1202)
and his complying with the documentary requirements set forth in § 10.24.
[T.D. 75–230, 40 FR 43021, Sept. 18, 1975, as
amended by T.D. 89–1, 53 FR 51247, Dec. 21,
1988; T.D. 97–82, 62 FR 51769, Oct. 3, 1997]

§ 10.12

Definitions.

As used in §§ 10.11 through 10.24, the
following terms shall have the meanings indicated:
(a) American-made. The term ‘‘American-made’’ is used to refer to a product
of the United States as defined in paragraph (e) of this section.
(b) Assembly. ‘‘Assembly’’ means the
fitting or joining together of fabricated
components.
(c) Exemption. ‘‘Exemption’’ means the
deduction of the cost or value of products of the United States which were
assembled abroad in accordance with
the
requirements
of
subheading
9802.00.80, Harmonized Tariff Schedule
of the United States (19 U.S.C. 1202),
from the full value of the assembled article.
(d) Fabricated component. ‘‘Fabricated
component’’ means a manufactured article ready for assembly in the condition as exported except for operations
incidental to the assembly.
(e) Product of the United States. A
‘‘product of the United States’’ is an article manufactured within the Customs
territory of the United States and may
consist wholly of United States components or materials, of United States
and foreign components or materials,
or wholly of foreign components or materials. If the article consists wholly or
partially of foreign components or materials, the manufacturing process
must be such that the foreign components or materials have been substantially transformed into a new and dif-

ferent article, or have been merged
into a new and different article.
[T.D. 75–230, 40 FR 43021, Sept. 18, 1975, as
amended by T.D. 89–1, 53 FR 51247, Dec. 21,
1988]

§ 10.13 Statutory
provision:
Subheading 9802.00.80, Harmonized
Tariff Schedule of the United States
(19 U.S.C. 1202).
Subheading 9802.00.80, Harmonized
Tariff Schedule of the United States
(HTSUS), (19 U.S.C. 1202), provides that
articles assembled abroad in whole or
in part of fabricated components, the
product of the United States, which (a)
were exported in condition ready for
assembly without further fabrication,
(b) have not lost their physical identity
in such articles by change in form,
shape, or otherwise, and (c) have not
been advanced in value or improved in
condition abroad except by being assembled and except by operations incidental to the assembly process such as
cleaning, lubricating, and painting, are
subject to a duty upon the full value of
the imported article, less the cost or, if
no charge is made, the value of such
products of the United States. The rate
of duty which is assessed upon the dutiable portion of the imported article is
that which is applicable to the imported article as a whole under the appropriate provision of the HTSUS (19
U.S.C. 1202) for such article. If that
provision requires a specific or compound rate of duty, the total duties assessed on the imported article are reduced in such proportion as the cost or
value of the returned United States
components which qualify for the exemption bears to the full value of the
assembled article.
Example 1. A transistor radio is assembled
abroad from foreign-made components and
American-made transistors. Upon importation, the transistor radio is subject to the ad
valorem rate of duty applicable to transistor
radios upon the value of the radio less the
cost or value of the American-made transistors assembled therein.
Example 2. A solid-state watch movement
is assembled abroad from foreign-made components and an American-made integrated
circuit. If the movement in question is subject to the specific rate of duty of 75 cents if
the value of the assembled movement is $30,
and if the value of the American-made integrated circuit is $10, then the value of the integrated circuit represents one third of the

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U.S. Customs and Border Protection, DHS; Treasury
total value of the assembled article and the
duty on the assembled article will be reduced
by one third ($.25). Therefore, the duty on
the assembled movement is 50 cents.
[T.D. 75–230, 40 FR 43021, Sept. 18, 1975, as
amended by T.D. 89–1, 53 FR 51247, Dec. 21,
1988]

§ 10.14

nents will be cut according to a pattern are
not regarded as fabricated components.
Similarly, other materials, such as lumber,
leather, sheet metal, plastic sheeting, exported in basic shapes and forms to be fabricated into components for assembly, are
not eligible for treatment as fabricated components.

§ 10.14 Fabricated components subject
to the exemption.
(a) Fabricated components, the product
of the United States. Except as provided
in § 10.15, the exemption provided under
subheading 9802.00.80, Harmonized Tariff Schedule of the United States
(HTSUS) (19 U.S.C. 1202), applies to fabricated components, the product of the
United States. The components must
be in condition ready for assembly
without further fabrication at the time
of their exportation from the United
States to qualify for the exemption.
Components will not lose their entitlement to the exemption by being subjected to operations incidental to the
assembly either before, during, or after
their assembly with other components.
Materials undefined in final dimensions and shapes, which are cut into
specific shapes or patterns abroad are
not considered fabricated components.

(b) Substantial transformation of foreign-made articles or materials. Foreignmade articles or materials may become
products of the United States if they
undergo a process of manufacture in
the United States which results in
their substantial transformation. Substantial transformation occurs when,
as a result of manufacturing processes,
a new and different article emerges,
having a distinctive name, character,
or use, which is different from that
originally possessed by the article or
material before being subject to the
manufacturing process. The mere finishing or modification of a partially or
nearly complete foreign product in the
United States will not result in the
substantial transformation of such
product and it remains the product of a
foreign country.

Example 1. Articles identifiable in their exported condition as components or parts of
the article into which they will be assembled, such as transistors, diodes, integrated
circuits, machinery parts, or precut parts of
wearing apparel, are regarded as fabricated
components.
Example 2. Prestamped metal lead frames
for semiconductor devices exported in multiple unit strips in which the individual
frame units are connected to each other, or
integrated circuit wafers containing individual integrated circuit dice which have
been scribed or scored in the United States,
are regarded as fabricated components. The
separation of the individual frames by cutting, or the segmentation of the wafer into
individual dice by flexing and breaking along
scribed or scored lines, is regarded as an operation incidental to the assembly process.
Example 3. Wires of various type, electrical
conductors, metal foils, insulating tapes, ribbons, findings used in dressmaking, and similar products, which are in a finished state
when exported from the United States, and
are ready for use in the assembly of the imported article, are regarded as fabricated
components if they are only cut to length or
subjected to operations incidental to the assembly process while abroad.
Example 4. Uncut textile fabrics exported in
bolts from which wearing apparel compo-

Example 1. A cast metal housing for a valve
is made in the United States from imported
copper ingots, the product of a foreign country. The housing is a product of the United
States because the manufacturing operations
performed in the United States to produce
the housing resulted in a substantial transformation of the foreign copper ingots.
Example 2. An integrated circuit device is
assembled in a foreign country and imported
into the United States where its leads are
formed by bending them to a specified angle.
It is then tested and marked. The imported
article does not become a product of the
United States because the operations performed in the United States do not result in
a substantial transformation of the foreign
integrated circuit device.
Example 3. A circuit board assembly for a
computer is assembled in the United States
by soldering American-made and foreignmade components onto an American-made
printed circuit board. The finished circuit
board assembly has a distinct electronic
function and is ready for incorporation into
the computer. The foreign-made components
have undergone a substantial transformation
by becoming permanent parts of the circuit
board assembly. The circuit board assembly,
including all of its parts is regarded as a fabricated component, the product of the United

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§ 10.15

19 CFR Ch. I (4–1–11 Edition)

States, for purposes of subheading 9802.00.80,
HTSUS (19 U.S.C. 1202).
[T.D. 75–230, 40 FR 43022, Sept. 18, 1975, as
amended by T.D. 89–1, 53 FR 51247, Dec. 21,
1988]

§ 10.15 Fabricated
components
not
subject to the exemption.
Fabricated components which are not
products of the United States are excluded from the exemption. In addition, the exemption is not applicable to
any component exported from the Customs territory of the United States:
(a) From continuous Customs custody with remission, abatement, or refund of duty;
(b) With benefit of drawback;
(c) To comply with any law of the
United States or regulation of any Federal agency requiring exportation; or
(d) After manufacture or production
in the United States under subheading
9813.00.05, HTSUS (19 U.S.C. 1202).
Example. Partially completed components
of an electric motor are imported in several
separate shipments and are entered under a
temporary importation bond to be manufactured into finished motors under the provisions of subheading 9813.00.05, HTSUS (19
U.S.C. 1202). The components are completed
and assembled into finished electric motors.
The finished motors are exported and are assembled abroad into electric fans which are
subsequently imported into the United
States. Irrespective of the fact that the assembly of the motors might involve such a
substantial change that the motor could be
considered a product of the United States, no
exemption may be given for the value of the
electric motors, since they were exported
after manufacture or production in the
United States under the provision of subheading 9813.00.05, HTSUS (19 U.S.C. 1202).
[T.D. 75–230, 40 FR 43023, Sept. 18, 1975, as
amended by T.D. 89–1, 53 FR 51247, Dec. 21,
1988]

§ 10.16 Assembly abroad.
(a) Assembly operations. The assembly
operations performed abroad may consist of any method used to join or fit
together solid components, such as
welding, soldering, riveting, force fitting, gluing, laminating, sewing, or the
use of fasteners, and may be preceded,
accompanied, or followed by operations
incidental to the assembly as illustrated in paragraph (b) of this section.
The mixing or combining of liquids,
gases, chemicals, food ingredients, and

amorphous solids with each other or
with solid components is not regarded
as an assembly.
Example 1. A television yoke is assembled
abroad from American-made magnet wire. In
the foreign assembly plant the wire is
despooled and wound into a coil, the wire cut
from the spool, and the coil united with
other components, including a terminal
panel and housing which are also Americanmade. The completed article upon importation would be subject to the ad valorem rate
of duty applicable to television parts upon
the value of the yoke less the cost or value
of the American-made wire, terminal panel
and housing, assembled therein. The winding
and cutting of the wire are either assembly
steps or steps incidental to assembly.
Example 2. An aluminum electrolytic capacitor is assembled abroad from Americanmade aluminum foil, paper, tape, and Mylar
film. In the foreign assembly plant the aluminum foil is trimmed to the desired width,
cut to the desired length, interleaved with
paper, which may or may not be cut to
length or despooled from a continuous
length, and rolled into a cylinder wherein
the foil and paper are cut and a section of
sealing tape fastened to the surface to prevent these components from unwinding. Wire
or other electric connectors are bonded at
appropriate intervals to the aluminum foil of
the cylinder which is then inserted into a
metal can, and the ends closed with a protective washer. As imported, the capacitor is
subject to the ad valorem rate of duty applicable to capacitors upon the value less the
cost or value of the American-made foil,
paper, tape, and Mylar film. The operations
performed on these components are all either assembly steps or steps incidental to assembly.
Example 3. The manufacture abroad of
cloth on a loom using thread or yarn exported from the United States on spools,
cops, or pirns is not considered an assembly
but a weaving operation, and the thread or
yarn does not qualify for the exemption.
However, American-made thread used to sew
buttons or garment components is qualified
for the exemption because it is used in an operation involving the assembly of solid components.

(b) Operations incidental to the assembly process. Operations incidental to the
assembly process whether performed
before, during, or after assembly, do
not constitute further fabrication, and
will not preclude the application of the
exemption. The following are examples
of operations which are incidental to
the assembly process:
(1) Cleaning;

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U.S. Customs and Border Protection, DHS; Treasury
(2) Removal of rust, grease, paint, or
other preservative coating;
(3) Application of paint or preservative coating, including preservative
metallic coating, lubricants, or protective encapsulation;
(4) Trimming, filing, or cutting off of
small amounts of excess materials;
(5) Adjustments in the shape or form
of a component to the extent required
by the assembly being performed
abroad;
(6) Cutting to length of wire, thread,
tape, foil, and similar products exported in continuous length; separation
by cutting of finished components,
such as prestamped integrated circuit
lead frames exported in multiple unit
strips; and
(7) Final calibration, testing, marking, sorting, pressing, and folding of assembled articles.
(c) Operations not incidental to the assembly process. Any significant process,
operation, or treatment other than assembly whose primary purpose is the
fabrication, completion, physical or
chemical improvement of a component,
or which is not related to the assembly
process, whether or not it effects a substantial transformation of the article,
will not be regarded as incidental to
the assembly and will preclude the application of the exemption to such article. The following are examples of operations not considered incidental to
the assembly as provided under subheading 9802.00.80, Harmonized Tariff
Schedule of the United States (19
U.S.C. 1202):
(1) Melting of exported ingots and
pouring of the metal into molds to
produce cast metal parts;
(2) Cutting of garment parts according to pattern from exported material;
(3) Chemical treatment of components or assembled articles to impart
new
characteristics,
such
as
showerproofing,
permapressing,
sanforizing, dying or bleaching of textiles;
(4) Machining, polishing, burnishing,
peening, plating (other than plating incidental to the assembly), embossing,
pressing, stamping, extruding, drawing,
annealing, tempering, case hardening,
and any other operation, treatment or
process which imparts significant new

§ 10.16

characteristics or qualities to the article affected.
(d) Joining of American-made and foreign-made components. An assembly operation may involve the use of American-made components and foreignmade components. The various requirements for establishing entitlement to
the exemption apply only to the American-made components of the assembly.
Example. Diodes are assembled abroad from
American-made components. The process includes the encapsulation of the assembled
components in a plastic shell. The plastic
used for the encapsulation is in the form of
a pellet, and is of foreign origin. After the
prefabricated diode components are assembled, the assembled unit is placed in a transfer molding machine, where, by use of the
pellet, molten epoxy is caused to flow around
the perimeters of the assembled components,
forming upon solidification a plastic body
for the diode. Upon importation, exemption
may be granted for the value of the American-made components, but not for the value
of the plastic pellet. If the plastic pellet used
for encapsulation was of United States origin, its value would still be a part of the dutiable value of the diode, because the plastic
pellet is not a fabricated component of a
type designed to be fitted together by assembly, but merely a premeasured quantity of
material which was applied to the assembled
unit by a process not constituting an assembly.

(e) Subassembly. An assembly operation may involve the joining or fitting
of American-made components into a
part or subassembly of an article, followed by the installation of the part or
subassembly into the complete article.
Example. Rolls of foil and rolls of paper are
exported and cut to specific length abroad
and interleaved and rolled to form the electrodes and dielectric of a capacitor. Following this procedure, the rolls are assembled with cans and other parts to form a
complete capacitor. The foil and paper are
entitled to the exemption.

(f) Packing. The packing abroad of
merchandise into containers does not
in itself qualify either the containers
or their contents for the exemption.
However, assembled articles which otherwise qualify for the exemption and
which are packaged abroad following
their assembly will not be disqualified
from the exemption by reason of their
having been so packaged, whether for
retail sale or for bulk shipment. The

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§ 10.17

19 CFR Ch. I (4–1–11 Edition)

tariff status of the packing materials
or containers will be determined in accordance with General Rule of Interpretation 5, HTSUS (19 U.S.C. 1202).
[T.D. 75–230, 40 FR 43023, Sept. 18, 1975, as
amended by T.D. 89–1, 53 FR 51248, Dec. 21,
1988; CBP Dec. 08-21, 73 FR 33300, June 12,
2008]

§ 10.17 Valuation of exempted components.
The value of fabricated components
to be subtracted from the full value of
the assembled article is the cost of the
components when last purchased, f.o.b.
United States port of exportation or
point of border crossing as set out in
the invoice and entry papers, or, if no
purchase was made, the value of the
components at the time of their shipment for exportation, f.o.b. United
States port of exportation or point of
border crossing, as set out in the invoice and entry papers. However, if the
appraising officer concludes that the
cost or value of the fabricated components so ascertained does not represent
a reasonable cost or value, then the
value of the components shall be determined in accordance with section 402 or
section 402a, Tariff Act of 1930, as
amended (19 U.S.C. 1401a, 1402).
[T.D. 75–230, 40 FR 43024, Sept. 18, 1975]

§ 10.18 Valuation of assembled articles.
As in the case of the appraisement of
any other import merchandise (see subpart C of part 152 of this chapter), the
full value of assembled articles imported under subheading 9802.00.80, Harmonized Tariff Schedule of the United
States (HTSUS) (19 U.S.C. 1202), is determined in accordance with 19 CFR
152.100 et seq.
[T.D. 87–89, 52 FR 24445, July 1, 1987, as
amended by T.D. 89–1, 53 FR 51248, Dec. 21,
1988]

§§ 10.19–10.20

[Reserved]

§ 10.21 Updating cost data and other
information.
When a claim for the exemption is
predicated on estimated cost data furnished either in advance of or at the

time of entry, this fact should be clearly stated in writing at the time of
entry, and suspension of liquidation
may be requested by the importer or
his agent pending the furnishing of actual cost data. Actual cost data must
be submitted as soon as accounting
procedures permit. To insure that information used for Customs purposes is
reasonably current, the importer shall
ordinarily be required to furnish updated cost and assembly data at least
every six months, regardless of whether he considers that significant
changes have occurred. The 6-month
period for the submission of updated
cost or other data may be extended by
the port director if such extension is
appropriate for the type of merchandise involved, or because of the accounting period normally used in the
trade, or because of other relevant circumstances.
[T.D. 75–230, 40 FR 43025, Sept. 18, 1975]

§ 10.23

Standards, quotas, and visas.

All requirements and restrictions applicable to imported merchandise, such
as labeling, radiation standards, flameretarding properties, quotas, and visas,
apply to assembled articles eligible for
the exemption in the same manner as
they would apply to all other imported
merchandise.
[T.D. 75–230, 40 FR 43025, Sept. 18, 1975]

§ 10.24

Documentation.

(a) Documents required. The following
documents shall be filed in connection
with the entry of assembled articles
claimed to be subject to the exemption
under
subheading
9802.00.80,
Harmonized Tariff Schedule of the United
States (HTSUS) (19 U.S.C. 1202).
(1) Declaration by the assembler. A declaration by the person who performed
the assembly operations abroad shall
be filed in substantially the following
form:
I, lllll, declare that to the best of my
knowledge and belief the lllll were assembled in whole or in part from fabricated
components listed and described below,
which are products of the United States:

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U.S. Customs and Border Protection, DHS; Treasury
Marks of identification, numbers

Description of component

Unit value at time
and place of export
from United
States 1

Quantity

§ 10.24
Port and date of
export from United
States

Name and address
of manufacturer

1 In accordance with U.S. Note 4 to Subchapter II of Chapter 98, Harmonized Tariff Schedule of the United States (19 U.S.C.
1202).
Description of the operations performed abroad on the exported components (in sufficient detail to enable Customs officers to
determine whether the operations performed are within the preview of subheading 9802.00.80, Harmonized Tariff Schedule of
the United States (19 U.S.C. 1202) (attach supplemental sheet if more space is required)):

llllllllllllllllllllllll
Date
Signature
llllllllllllllllllllllll
Address
Capacity

(2) Endorsement by the importer. An endorsement, in substantially the following form, shall be signed by the importer:
I declare that to the best of my knowledge
and belief the (above), (attached) declaration, and any other information submitted
herewith, or otherwise supplied or referred
to, is correct in every respect and there has
been compliance with all pertinent legal
notes to the Harmonized Tariff Schedule of
the United States (19 U.S.C. 1202).
llllllllllllllllllllllll
Date
Signature
llllllllllllllllllllllll
Address
Capacity

(b) Revision of format. In specific
cases, the port director may revise the
format of either of the documents specified in paragraph (a) of this section
and may make such changes as conditions warrant, provided the data and
information required to be supplied in
these documents are presented. For example, if the components were furnished by the importer, the information on components may be supplied as
part of the importer’s endorsement,
rather than as part of the assembler’s
declaration.
(c) Reference to previously filed documents. In lieu of filing duplicate lists of
components and descriptions of assembly operations with each entry, the
documents specified in paragraph (a) of
this section may refer to assembly descriptions and lists of components previously filed with and approved by the
port director, or to records showing
costs, names of manufacturers, and
other necessary data on components,
provided the importer has arranged
with the port director to maintain such

records and keep them available for examination by authorized Customs officers.
(d) Waiver of specific details for each
entry. There are cases where large
quantities of United States components are purchased from various
sources or exported at various ports
and dates on a continuing basis, so that
it is impractical to identify the exact
source, port and date of export for each
particular component included in an
entry of merchandise claimed to be
subject to the exemption under subheading 9802.00.80, HTSUS (19 U.S.C.
1202). In these cases, specific details
such as the port and date of export and
the name of the manufacturer of the
United States components may be
waived if the port director is satisfied
that the importer and assembler have
established reliable controls to insure
that all components for which the exemption is claimed are in fact products
of the United States. These controls
shall include strict physical segregation of United States and foreign components, as well as records of United
States components showing quantities,
sources, costs, dates shipped abroad,
and other necessary information. These
records shall be maintained by the importer and assembler for 5 years from
the date of the released entry in a manner so that they are readily available
for audit, inspection, copying, reproduction or other official use by authorized Customs officers.
(e) Waiver of documents. When the
port director is satisfied that unusual
circumstances make the production of
either or both of the documents specified in paragraph (a) of this section, or
of any of the information set forth
therein, impractical and is further satisfied that the requirements of subheading 9802.00.80, HTSUS, and related

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§ 10.25

19 CFR Ch. I (4–1–11 Edition)

legal notes have been met, he may
waive the production of such document(s) or information.
(f) Unavailability of documents at time
of entry. If either or both of the documents specified in paragraph (a) of this
section are not available at the time of
entry, a bond on Customs Form 301
containing the bond conditions set
forth in § 113.62 of this chapter for the
production of the document(s) may be
given pursuant to §§ 113.41–113.46 and
141.66 of this chapter.
(g) Responsibility of correctness. Subject to the civil and criminal sanctions
provided by law for false or fraudulent
entries, the importer has the ultimate
responsibility for supplying all information needed by the Customs Service
to process an entry, and for the completeness and truthfulness of such information. If certain information cannot be supplied by the assembler, it
must be provided by the importer.
[T.D. 75–230, 40 FR 43025, Sept. 18, 1975, as
amended by T.D. 79–159, 44 FR 31967, June 4,
1979; T.D. 84–213, 49 FR 41165, Oct. 19, 1984;
T.D. 89–1, 53 FR 51248, Dec. 21, 1988]

§ 10.25 Textile components cut to
shape in the United States and assembled abroad.
Where a textile component is cut to
shape (but not to length, width, or
both) in the United States from foreign
fabric and exported to another country,
territory, or insular possession for assembly into an article that is then returned to the United States and entered, or withdrawn from warehouse,
for consumption on or after July 1,
1996, the value of the textile component
shall not be included in the dutiable
value of the article. For purposes of determining whether a reduction in the
dutiable value of an imported article
may be allowed under this section:
(a) The terms ‘‘textile component’’
and ‘‘fabric’’ have reference only to
goods covered by the definition of
‘‘textile or apparel product’’ set forth in
§ 102.21(b)(5) of this chapter;
(b) The operations performed abroad
on the textile component shall conform
to the requirements and examples set
forth in § 10.16 insofar as they may be
applicable to a textile component; and

(c) The valuation and documentation
provisions of §§ 10.17, 10.18, 10.21 and
10.24 shall apply.
[T.D. 95–69, 60 FR 46196, Sept. 5, 1995; T.D. 95–
69, 60 FR 55995, Nov. 6, 1995]

§ 10.26 Articles assembled or processed
in a beneficiary country in whole of
U.S. components or ingredients; articles assembled in a beneficiary
country from textile components
cut to shape in the United States.
(a) No article (except a textile article, apparel article, or petroleum, or
any product derived from petroleum,
provided for in heading 2709 or 2710,
Harmonized Tariff Schedule of the
United States (HTSUS)) shall be treated as a foreign article or as subject to
duty:
(1) If the article is assembled or processed in a beneficiary country in whole
of fabricated components that are a
product of the United States; or
(2) If the article is processed in a beneficiary country in whole of ingredients (other than water) that are a product of the United States; and
(3) Neither the fabricated components, materials or ingredients after
their exportation from the United
States, nor the article before its importation into the United States, enters
into the commerce of any foreign country other than a beneficiary country.
(b) No article (except a textile or apparel product) entered, or withdrawn
from warehouse, for consumption on or
after July 1, 1996, shall be treated as a
foreign article or as subject to duty:
(1) If the article is assembled in a
beneficiary country in whole of textile
components cut to shape (but not to
length, width, or both) in the United
States from foreign fabric; or
(2) If the article is assembled in a
beneficiary country in whole of both
textile components described in paragraph (b)(1) of this section and components that are products of the United
States; and
(3) Neither the components after
their exportation from the United
States, nor the article before its importation into the United States, enters
into the commerce of any foreign country other than a beneficiary country.
(c) For purposes of this section:

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U.S. Customs and Border Protection, DHS; Treasury
(1) The terms ‘‘textile article’’, ‘‘apparel article’’, and ‘‘textile or apparel
product’’ cover all articles, other than
footwear and parts of footwear, that
are classifiable in an HTSUS subheading which carries a textile and apparel category number designation;
(2) The term ‘‘beneficiary country’’
has
the
meaning
set
forth
in
§ 10.191(b)(1); and
(3) A component, material, ingredient, or article shall be deemed to
have not entered into the commerce of
any foreign country other than a beneficiary country if:
(i) The component, material, or ingredient was shipped directly from the
United States to a beneficiary country,
or the article was shipped directly to
the United States from a beneficiary
country, without passing through the
territory of any non-beneficiary country; or
(ii) Where the component, material,
ingredient, or article passed through
the territory of a non-beneficiary country while en route to a beneficiary
country or the United States:
(A) The invoices, bills of lading, and
other shipping documents pertaining to
the component, material, ingredient,
or article show a beneficiary country
or the United States as the final destination and the component, material,
ingredient, or article was neither sold
at wholesale or retail nor subjected to
any processing or other operation in
the non-beneficiary country; or
(B) The component, material, ingredient, or article remained under the
control of the customs authority of the
non-beneficiary country and was not
subjected to operations in that nonbeneficiary country other than loading
and unloading and activities necessary
to preserve the component, material,
ingredient, or article in good condition.
[T.D. 95–69, 60 FR 46197, Sept. 5, 1995]

FREE ENTRY—ARTICLES FOR THE USE OF
FOREIGN MILITARY PERSONNEL
§ 10.30c

[Reserved]

TEMPORARY IMPORTATIONS UNDER BOND
§ 10.31 Entry; bond.
(a)(1) Entry of articles brought into
the United States temporarily and

§ 10.31

claimed to be exempt from duty under
Chapter 98, Subchapter XIII, Harmonized Tariff Schedule of the United
States (HTSUS), unless covered by an
A.T.A. carnet or a TECRO/AIT carnet
as provided in part 114 of this chapter,
shall be made on Customs Form 3461 or
7533, supported by the documentation
required by § 142.3 of this chapter. However, when § 10.36 or § 10.36a is applicable, or the aggregate value of the article is not over $250, the form prescribed
for the informal entry of importations
by mail, in baggage, or by other means,
may be used. When entry is made on
Customs Form 3461 or 7533, an entry
summary, Customs Form 7501, shall be
filed within 10 days after time of entry,
in accordance with subpart B, part 142
of this chapter.
(2) If Customs Form 7501 is filed at
time of entry, it shall serve as both the
entry and entry summary, and Customs Form 3461 or 7533 shall not be required. Customs Form 7501 shall be in
original only, except for entries under
subheading 9813.00.05, HTSUS, which
require a duplicate copy for statistical
purposes. When articles are entered
under an A.T.A. carnet or a TECRO/
AIT carnet, the importation voucher of
the carnet shall serve as the entry.
(3) In addition to the data usually
shown on a regular consumption entry
summary, each temporary importation
bond entry summary shall include:
(i) The HTSUS subheading number
under which entry is claimed.
(ii) A statement of the use to be
made of the articles in sufficient detail
to enable the port director to determine whether they are entitled to
entry as claimed, and
(iii) A declaration that the articles
are not to be put to any other use and
that they are not imported for sale or
sale on approval.
(b) The port director, if he is satisfied
as to the importer’s identity and good
faith, may admit a vehicle or craft
brought in by a nonresident to take
part in a race or other specific contest
for which no money purse is awarded,
under the provisions of subheading
9813.00.35, HTSUS, without formal
entry or security for exportation. If at
the time of arrival it appears that the
article is likely to remain in the

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§ 10.31

19 CFR Ch. I (4–1–11 Edition)

United States beyond 90 days, formal
entry and bond shall be taken.
(c) When any article has been admitted without formal entry or security
for exportation and the importer thereafter desires to prolong his stay beyond
90 days, an entry covering the article
and security for its exportation shall
be accepted at any port where the article may be presented for entry. The
time during which the imported article
may remain in the United States under
the entry shall be computed from the
date of its original arrival in the
United States. The estimated duties for
the purpose of fixing the amount of any
bond required by paragraph (f) of this
section shall be the estimated duties
which would have been required to be
deposited had the article been entered
under an ordinary consumption entry
on the date of the original arrival.
(d) [Reserved]
(e) The entry or invoice shall: (1) Describe each article in detail; (2) set
forth the value of each article; and (3)
set forth any marks or numbers thereon or other distinguishing features
thereof. In the case of a vehicle, aircraft, or pleasure boat entered under
subheading 9813.00.05, HTSUS and
§ 10.36a, the registration number, and
engine or motor number, and the body
number (if available) shall also be
shown on the entry. Examination of
the imported articles shall be made
whenever the circumstances warrant,
and occasionally in any event to an extent which will enable the Customs officer to determine that the importation
is in agreement with the invoice or
entry as to identity and quantity and
for the purpose of accepting the entry
under the applicable provisions of
Chapter 98, Subchapter XIII, HTSUS.
No examination for the purpose of appraisement and no appraisement of the
articles shall be made.
(f) With the exceptions stated herein,
a bond shall be given on Customs Form
301, containing the bond conditions set
forth in § 113.62 of this chapter, in an
amount equal to double the duties, including fees, which it is estimated
would accrue (or such larger amount as
the port director shall state in writing
or by the electronic equivalent to the
entrant is necessary to protect the revenue) had all the articles covered by

the entry been entered under an ordinary consumption entry. In the case of
samples solely for use in taking orders
entered under subheading 9813.00.20,
HTSUS, motion-picture advertising
films
entered
under
subheading
9813.00.25, HTSUS, and professional
equipment, tools of trade and repair
components for such equipment or
tools
entered
under
subheading
9813.00.50, HTSUS, the bond required to
be given shall be in an amount equal to
110 percent of the estimated duties, including fees, determined at the time of
entry. If appropriate a carnet, under
the provisions of part 114 of this chapter, may be filed in lieu of a bond on
Customs Form 301 (containing the bond
conditions set forth in § 113.62 of this
chapter). Cash deposits in the amount
of the bond may be accepted in lieu of
sureties. When the articles are entered
under subheading 9813.00.05, 9813.00.20,
or 9813.00.50, HTSUS without formal
entry, as provided for in §§ 10.36 and
10.36a, or the amount of the bond taken
under any subheading of Chapter 98,
Subchapter XIII, HTSUS, is less than
$25, the bond shall be without surety or
cash deposit, and the bond shall be
modified to so indicate. In addition,
notwithstanding any other provision of
this paragraph, in the case of professional equipment necessary for carrying out the business activity, trade
or profession of a business person,
equipment for the press or for sound or
television
broadcasting,
cinematographic equipment, articles imported
for sports purposes and articles intended for display or demonstration, if
brought into the United States by a
resident of Canada, Mexico, Singapore,
Chile, Morocco, El Salvador, Guatemala, Honduras, Nicaragua, the Dominican Republic, Costa Rica, Bahrain,
or Oman and entered under Chapter 98,
Subchapter XIII, HTSUS, no bond or
other security will be required if the
entered article is a good originating,
within the meaning of General Notes
12, 25, 26, 27, 29, 30, and 31, HTSUS, in
the country of which the importer is a
resident.
(g) Claim for free entry under Chapter 98, Subchapter XIII, HTSUS may be

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U.S. Customs and Border Protection, DHS; Treasury
made for articles of any character described therein which have been previously entered under any other provision of law and the entry amended accordingly upon compliance with the requirements of this section, provided
the articles have not been released
from CBP custody, or even though released from CBP custody if it is established that the original entry was made
on the basis of a clerical error, mistake
of fact, or other inadvertence within
the meaning of section 514(a), Tariff
Act of 1930, as amended, and was
brought to the attention of CBP within
the time limits of that section. If an
entry is so amended, the period of time
during which the merchandise may remain in the customs territory of the
United States under bond shall be computed from the date of importation. In
the case of articles covered by an informal mail entry, such a claim may be
made within a reasonable time either
before or after the articles have been
released from CBP custody.
(h) After the entry and bond have
been accepted, the articles may be released to the importer. The entry shall
not be liquidated as the transaction
does not involve liquidated duties.
However, a TIB importer may be required to file an entry for consumption
and pay duties, or pay liquidated damages under its bond for a failure to do
so, in the case of merchandise imported
under subheading 9813.00.05, HTSUS,
and subsequently exported to Canada
or Mexico (see § 181.53 of this chapter).
[28 FR 14663, Dec. 31, 1963, as amended at CBP
Dec. 11-01, 76 FR 708, Jan. 6, 2011]
EDITORIAL NOTE: For FEDERAL REGISTER citations affecting § 10.31, see the List of CFR
Sections Affected, which appears in the
Finding Aids section of the printed volume
and at www.fdsys.gov.

§ 10.33 Theatrical effects.
For purposes of the entry of theatrical scenery, properties and apparel
under
subheading
9817.00.98,
Harmonized Tariff Schedule of the United
States:
(a) Animals imported for use or exhibition in theaters or menageries may
be classified as theatrical properties;
and
(b) The term ‘‘theatrical scenery,
properties and apparel’’ shall not be

§ 10.36

construed to include motion-picture
films.
For provisions relating to the return
without formal entry of theatrical effects taken from the United States, see
§ 10.68 of this part.
[T.D. 92–85, 57 FR 40605, Sept. 4, 1992, as
amended by CBP Dec. 04–28, 69 FR 52599, Aug.
27, 2004]

§ 10.35 Models of women’s wearing apparel.
(a) Models of women’s wearing apparel
admitted
under
subheading
9813.00.10, Harmonized Tariff Schedule
of the United States (HTSUS), shall
not be removed from the importer’s establishment for reproducing, copying,
painting, sketching, or for any other
use by others, nor be used in the importer’s establishment for such purposes except by the importer or his employees.
(b) Invoices covering models of women’s wearing apparel entered under subheading 9813.00.10 or 9813.00.25, HTSUS
shall state the kind and color of the
principal material from which the apparel is made, and shall contain a description of the lining and the trimming, stating whether composed of fur,
lace, embroidery, or other material. Invoices shall also contain a statement
as to how the trimming is applied, that
is, whether on the cuffs, collar, sleeves,
or elsewhere, and the total value of
each completed garment or article.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 87–75, 52 FR 20066, May 29, 1987; T.D. 89–
1, 53 FR 51248, Dec. 21, 1988]

§ 10.36 Commercial travelers’ samples;
professional equipment and tools of
trade; theatrical effects and other
articles.
(a) Samples accompanying a commercial traveler who presents an adequate descriptive list or a special CBP
invoice, and professional equipment,
tools of trade, and repair components
for such equipment or tools imported
in his baggage for his own use by a
nonresident sojourning temporarily in
the United States may be entered on
the importer’s baggage declaration in
lieu of formal entry and examination
and may be passed under subheadings
9813.00.20 or 9813.00.50, Harmonized Tariff Schedule of the United States,

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§ 10.36a

19 CFR Ch. I (4–1–11 Edition)

(HTSUS), at the place of arrival in the
same manner as other passengers’ baggage. The examination may be made by
an inspector who is qualified, in the
opinion of the port director, to determine the amount of the bond required
by § 10.31(c) to be filed in support of the
entry. If the articles are a commercial
traveler’s samples and exceed $500 in
value, a special Customs invoice or a
descriptive list shall be furnished.
(b) When the proprietor or manager
of a theatrical exhibition arriving from
abroad who has entered his scenery,
properties, and apparel under subheading
9817.00.98,
HTSUS,
contemplates side trips to a contiguous
country with the exhibition within the
period of time during which the merchandise may remain in the customs
territory of the United States under
bond, including any lawful extension, a
copy of the entry covering the effects
and a copy of a descriptive list of such
effects or invoice furnished by him
may be certified by the examining officer and returned to the proprietor or
manager for use in registering the effects with the CBP officers at the port
of exit, and in clearing them through
CBP on his return. Cancellation of the
bond shall be effected by exportation in
accordance with the provisions of
§ 10.38 at the time the theatrical effects
are finally taken out of the United
States before the expiration of the period of time during which the merchandise may remain in the customs territory of the United States under bond,
including any lawful extension. Similar treatment may be accorded articles
entered under other subheadings in
chapter 98, subchapter XIII, HTSUS,
upon approval by Headquarters, U.S.
Customs and Border Protection.
(c) When a commercial traveler contemplates side trips to a contiguous
country within the period of time during which the merchandise may remain
in the customs territory of the United
States under bond, including any lawful extension, a copy of his baggage
declaration and a copy of the descriptive list or special CBP invoice furnished by him may be certified by the
examining officer and returned to the
traveler for use in registering the samples with CBP officers at the port of
exit, and in clearing them through CBP

upon his return. Cancellation of the
bond shall be effected by exportation in
accordance with the provisions of
§ 10.38 at the time the samples are finally taken out of the United States
before the expiration of the period of
time during which the merchandise
may remain in the customs territory of
the United States under bond, including any lawful extension.
(d) The privilege of clearance of commercial travelers’ samples or professional equipment, tools of trade, and
repair components for such equipment
or tools imported for his own use by a
nonresident sojourning temporarily in
the United States on a baggage declaration under bond without surety or
cash deposit shall not be accorded to a
commercial traveler or such nonresident who, through fraud or culpable
negligence, has failed to comply with
the provisions of such a bond in connection with a prior arrival.
Such a commercial traveler or nonresident shall be required to file a formal entry under subheading 9813.00.20
or subheading 9813.00.50, HTSUS with a
bond supported by a surety or cash deposit in lieu of surety.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 69–146, 34 FR 9799, June 25, 1969; T.D. 84–
213, 49 FR 41165, Oct. 19, 1984; T.D. 89–1, 53 FR
51248, Dec. 21, 1988; CBP Dec. 10–29, 75 FR
52450, Aug. 26, 2010]

§ 10.36a Vehicles, pleasure boats and
aircraft brought in for repair or alteration.
(a) A vehicle (such as an automobile,
truck, bus, motorcycle, tractor, trailer), pleasure boat, or aircraft brought
into the United States by an operator
of such vehicle, pleasure boat, or aircraft for repair or alteration (as defined in §§ 10.8, 10.490, 10.570, and 181.64
of this chapter) may be entered on the
operator’s baggage declaration, in lieu
of formal entry and examination, and
may be passed under subheading
9813.00.05, Harmonized Tariff Schedule
of the United States (HTSUS), at the
place of arrival in the same manner as
passengers’ baggage. When the vehicle,
aircraft, or pleasure boat to be entered
is being towed by or transported on another vehicle, the operator of the towing or transporting vehicle may make

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U.S. Customs and Border Protection, DHS; Treasury
entry for the vehicle, aircraft or pleasure boat to be repaired or altered. The
bond, prescribed by § 10.31(f), filed to
support entry under this section shall
be without surety or cash deposit except as provided by this paragraph and
paragraph (d) of this section. The examination may be made by an inspector who is qualified to determine the
amount of such bond to be filed in support of the entry. The privilege accorded by this paragraph shall not
apply when two or more vehicles,
pleasure boats, or aircraft are to be entered by the same importer under subheading 9813.00.05, HTSUS, at the same
time. In that event, the importer must
file a formal entry supported by bond
with surety or cash deposit in lieu of
surety.
(b) Each vehicle, pleasure boat, or
aircraft to which paragraph (a) of this
section is applicable shall be identified
on the operator’s baggage declaration,
which must include the data prescribed
in paragraphs (a) and (e) of § 10.31.
(c) Exportation shall be effected in
accordance with the provisions of
§ 10.38.
(d) The privilege of clearance of a vehicle, pleasure boat, or aircraft
brought in by the operator of such vehicle, pleasure boat, or aircraft, for repair or alteration on his baggage declaration under bond without surety or
cash deposit shall not be granted to an
individual who has failed to comply
with the provisions of such a bond in
connection with any prior arrival.
Such individual shall be required to
file a formal entry under subheading
9813.00.05, HTSUS, with a bond supported by a surety or cash deposit in
lieu of surety.
[T.D. 66–39, 31 FR 2817, Feb. 17, 1966, as
amended by T.D. 84–213, 49 FR 41165, Oct. 19,
1984; T.D. 89–1, 53 FR 51248, Dec. 21, 1988; T.D.
94–1, 58 FR 69470, Dec. 30, 1993; CBP Dec. 05–
07, 70 FR 10872, Mar. 7, 2005; CBP Dec. 07–28,
72 FR 31995, June 11, 2007]

§ 10.37 Extension of time for exportation.
The period of time during which merchandise entered under bond under
chapter 98, subchapter XIII, Harmonized Tariff Schedule of the United
States (19 U.S.C. 1202), may remain in
the customs territory of the United

§ 10.38

States, may be extended for not more
than two further periods of 1 year each,
or such shorter period as may be appropriate. Extensions may be granted by
the director of the port where the
entry was filed upon written application on CBP Form 3173, provided the
articles have not been exported or destroyed before the receipt of the application, and liquidated damages have
not been assessed under the bond before receipt of the application. Any untimely request for an extension of time
for exportation shall be referred to the
Director, Commercial and Trade Facilitation Division, Office of International Trade, CBP Headquarters, for
disposition. Any request for relief from
a liquidated damage assessment in excess of a Fines, Penalties, and Forfeitures Officer’s delegated authority shall
be referred to the Director, Border Security and Trade Compliance Division,
Office of International Trade, CBP
Headquarters, for disposition. No extension of the period for which a carnet
is valid shall be granted.
[T.D. 69–146, 34 FR 9799, June 25, 1969, as
amended by T.D. 84–213, 49 FR 41165, Oct. 19,
1984; T.D. 89–1, 53 FR 51249, Dec. 21, 1988; T.D.
91–77, 56 FR 46114, Sept. 10, 1991; T.D. 99–27, 64
FR 13675, Mar. 22, 1999]

§ 10.38

Exportation.

(a) Articles entered under chapter 98,
subchapter XIII, Harmonized Tariff
Schedule of the United States (HTSUS)
(19 U.S.C. 1202) may be exported at the
port of entry or at another port. An application on Customs Form 3495 shall
be filed in duplicate with the port director a sufficient length of time in advance of exportation to permit the examination and identification of the articles if circumstances warrant such
action and, in such event, the applicant
shall be notified on a copy of Customs
Form 3495 where the articles are to be
sent for identification. If a carnet was
used for entry purposes, the reexportation voucher of the carnet shall be
filed, in addition to Customs Form
3495, and the carnet shall be presented
for certification.
(b) All expenses in connection with
the delivery of the articles for examination, the cording and sealing of such

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§ 10.39

19 CFR Ch. I (4–1–11 Edition)

articles, and their transfer for exportation shall be paid by the parties in
interest.
(c) If exportation is to be made at a
port other than the one at which the
merchandise was entered, the application on Customs Form 3495 shall be
filed in triplicate. There shall also be
filed with the application a certified
copy of the import entry or a certified
copy of the invoice used on entry.
(d) If the goods are examined at one
port and are to be exported from another port, they shall be forwarded to
the port of exportation under a transportation and exportation entry. In
such cases Customs Form 3495 shall be
filed in triplicate. Articles entered
under a carnet shall not be examined
elsewhere than at the port from which
they are to be exported.
(e) If the articles are to be exported
by mail or parcel post, the package
containing the articles must be mailed
under Customs supervision after examination. Waiver of the right to withdraw the package from the mails shall
be endorsed on each package to be so
exported and signed by the exporter.
(f) Whenever the circumstances warrant, and occasionally in any event,
port directors shall cause the fact of
exportation to be verified by the Office
of Enforcement in harmony with the
procedures provided for in §§ 18.7 and
191.61 of this chapter.
(g) Upon the presentation of satisfactory evidence to the director of the
port at which samples were entered
under subheading 9813.00.20, HTSUS, or
professional equipment or tools of
trade were entered under subheading
9813.00.50, HTSUS, that such articles
cannot be exported for the reason that
they have been seized (other than by
seizure at the suit of private persons),
the requirement of exportation shall be
suspended for the duration of the seizure. The articles shall be exported
promptly after release from seizure.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 69–146, 34 FR 9799, June 25, 1969; T.D. 83–
212, 48 FR 46771, Oct. 14, 1983; T.D. 84–213, 49
FR 41165, Oct. 19, 1984; T.D. 89–1, 53 FR 51249,
Dec. 21, 1988; T.D. 91–77, 56 FR 46114, Sept. 10,
1991; T.D. 98–16, 63 FR 11004, Mar. 5, 1998]

§ 10.39

Cancellation of bond charges.

(a) Charges against bonds taken pursuant to Chapter 98, Subchapter XIII,
Harmonized Tariff Schedule of the
United States, (HTSUS), may be canceled in the manner prescribed in
§ 113.55 of this chapter. A completed reexportation counterfoil on a carnet establishes that the articles covered by
the carnet have been exported, and no
claim shall be brought against the
guaranteeing association under the
carnet for failure to export, except
under the provisions of § 114.26 of this
chapter. In the case of articles entered
under subheading 9813.00.30, HTSUS,
which are destroyed because of their
use for the purposes of importation,
the bond charge shall not be canceled
unless there is submitted to the port
director a certificate of the importer
that the articles were destroyed during
the course of a specifically described
use, and the port director is satisfied
that the articles were so destroyed as
articles of commerce within the period
of time during which the articles may
remain in the Customs territory of the
United States under bond (including
any lawful extension). Bonds covering
articles entered under other provisions
of law shall not be canceled upon proof
of destruction, except as provided for
in paragraph (c) of this section, unless
the articles are destroyed under Customs supervision in accordance with
section 557, Tariff Act of 1930, as
amended, and § 158.43 of this chapter.
(b) Where exportation has been made
at a port other than the port of entry,
the bond may be canceled upon the certificate of lading received from the
port of exportation, showing that such
exportation was made within the period of time during which the articles
may remain in the Customs territory
of the United States under bond. In addition, the port director may require
the production of a landing certificate
signed by a revenue officer of the country to which the merchandise is exported.
(c) When articles entered temporarily
free of duty under bond are destroyed
within the bond period by death, accidental fire, or other casualty, petition
for relief from liability under the bond

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U.S. Customs and Border Protection, DHS; Treasury
shall be made to the United States Customs Service. The petition shall be accompanied by a statement of the importer, or other person having knowledge of the facts, setting forth the circumstances of the destruction of the
articles.
(d)(1) If any article entered under
Chapter 98, subchapter XIII, HTSUS,
except those entered under a carnet,
has not been exported or destroyed in
accordance with the regulations in this
part within the period of time during
which the articles may remain in the
Customs territory of the United States
under bond (including any lawful extension), the Fines, Penalties, and Forfeitures Officer shall make a demand in
writing under the bond for the payment of liquidated damages equal to
double the estimated duties applicable
to such entry, unless a different
amount is prescribed by § 10.31(f). The
demand shall include a statement that
a written petition for relief from the
payment of the full liquidated damages
may be filed with the Fines, Penalties,
and Forfeitures Officer within 60 days
after the date of the demand. For purposes of this section, the term estimated duties shall include any merchandise processing fees applicable to
such entry.
(2) If articles entered under a carnet
have not been exported or destroyed in
accordance with the regulations in this
part within the carnet period, the port
director shall promptly after expiration of that period make demand in
writing upon the importer and guaranteeing association for the payment of
liquidated damages in the amount of
110 percent of the estimated duties on
the articles not exported or destroyed.
The guaranteeing association shall
have a period of 6 months from the
date of claim in which to furnish proof
of the exportation or destruction of the
articles under conditions set forth in
the Convention or Agreement under
which the carnet is issued. If such
proof is not furnished within the 6–
month period, the guaranteeing association shall forthwith pay the liquidated damages provided for above.
The payment shall be refunded if the
guaranteeing association within 3
months from the date of payment furnishes the proof referred to above. No

§ 10.39

claim for payment under a carnet covering a temporary importation may be
made against the guaranteeing association more than 1 year after the expiration of the period for which the carnet
was valid.
(3) Demand for return to Customs
custody. When the demand for return
to Customs custody is made in the case
of merchandise entered under Chapter
98, subchapter XIII, HTSUS (19 U.S.C.
1202), liquidated damages in an amount
equal to double the estimated duties on
the merchandise not returned shall be
demanded, except that in the case of
samples solely for use in taking orders,
motion-picture advertising films, professional equipment, tools of trade, and
repair components for professional
equipment and tools of trade, the liquidated damages demanded shall be in
an amount equal to 110 percent of the
estimated duties.
(e) If there has been a default with
respect to any or all of the articles covered by the bond and a written petition
for relief is filed as provided in part 172
of this chapter, it will be reviewed by
the Fines, Penalties, and Forfeitures
Officer having jurisdiction in the port
where the entry was filed. If the Fines,
Penalties, and Forfeitures Officer is
satisfied that the importation was
properly entered under Chapter 98, subchapter XIII, and that there was no intent to defraud the revenue or delay
the payment of duty, the Fines, Penalties, and Forfeitures Officer may cancel the liability for the payment of liquidated damages in any case in his or
her delegated authority as follows:
(1) If evidence is furnished which satisfies the Fines, Penalties, and Forfeitures Officer that the article would have
been entitled to free entry as domestic
products exported and returned had the
evidence been furnished at the time of
entry, without the collection of liquidated damages.
(2) If the article has been exported or
destroyed under Customs supervision
but not within the period of time during which the articles may remain in
the Customs territory of the United
States under bond, upon the payment
of such lesser amount as the port director may deem appropriate under the
law and in view of the circumstances,
or without the collection of liquidated

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§ 10.40

19 CFR Ch. I (4–1–11 Edition)

damages if the Fines, Penalties, and
Forfeitures Officer is satisfied that the
delay in exportation or destruction was
for the benefit of the United States or
was
occasioned
wholly
by
circumstances reasonably beyond the control of the parties concerned and which
could not have been anticipated by a
reasonably prudent person.
(3) If the article was exported or destroyed within the period of time during which the articles may remain in
the Customs territory of the United
States under bond but not under Customs supervision and satisfactory documentary evidence of actual exportation, such as a foreign landing certificate, or of death or other complete
destruction, such as a veterinarian’s
certificate or certificates of two disinterested witnesses, are furnished together with a complete explanation by
the applicant of the failure to obtain
Customs supervision, upon the payment of such lesser amount as the
Fines, Penalties, and Forfeitures Officer may deem appropriate under the
law and in view of the circumstances,
or without the collection of liquidated
damages if the port director is satisfied
that the merchandise was destroyed
under circumstances which precluded
any arrangement to obtain Customs
supervision. Satisfactory documentary
evidence of exportation, in the case of
carnets, would include the particulars
regarding importation or reimportation entered in the carnet by the Customs authorities of another contracting party, or a certificate with respect to importation or reimportation
issued by those authorities, based on
the particulars shown on a voucher
which was detached from the carnet on
importation or reimportation into
their territory, provided it is shown
that the importation or reimportation
took place after the exportation which
it is intended to establish.
(4) Upon the payment of an amount
equal to double the duty which would
have accrued on the articles had they
been entered under an ordinary consumption entry, or equal to 110 percent
of such duties where that percentage is
prescribed in § 10.31(f), if such amount
is determined to be less than the full
amount of the bond.

(f) Anticipatory breach. If an importer
anticipates that the merchandise entered under a Temporary Importation
Bond will not be exported or destroyed
in accordance with the terms of the
bond, the importer may indicate to
Customs in writing before the bond period has expired of the anticipatory
breach. At the time of written notification of the breach, the importer shall
pay to Customs the full amount of liquidated damages that would be assessed at the time of breach of the
bond, and the entry will be closed. The
importer shall notify the surety in
writing of the breach and payment. By
this payment, the importer waives his
right to receive a notice of claim for
liquidated damages as required by
§ 172.1(a) of this chapter.
(g) If the petitioner is not satisfied
with the port director’s action under
this section and submits a supplemental petition, both the original and
the supplemental petitions shall be
transmitted to the designated Headquarters official with a full report on
the case.
[28 FR 14663, Dec. 31, 1963]
EDITORIAL NOTE: For FEDERAL REGISTER citations affecting § 10.39, see the List of CFR
Sections Affected, which appears in the
Finding Aids section of the printed volume
and at www.fdsys.gov.

§ 10.40

Refund of cash deposits.

(a) When a cash deposit is made in
lieu of surety, it shall be refunded to
the person in whose name the entry is
made upon exportation in compliance
with § 10.38.
(b) If any article entered under Chapter 98, subchapter XIII, Harmonized
Tariff Schedule of the United States, is
not exported or destroyed within the
period of time during which articles
may remain in the Customs territory
of the United States under bond (including any lawful extension), the port
director shall notify the importer in
writing that the entire cash deposit
will be transferred to the regular account as liquidated damages unless a
written application for relief from the
payment of the full liquidated damages
is filed with the port director within 60
days after the date of the notice. If
such an application is timely filed, the

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U.S. Customs and Border Protection, DHS; Treasury
transfer of the cash deposit to the regular account as liquidated damages
shall be deferred pending the decision
of the Headquarters, U.S. Customs
Service or, in appropriate cases, the
port director on the application.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 84–213, 49 FR 41165, Oct. 19, 1984; T.D. 89–
1, 53 FR 41249, Dec. 21, 1988]

INTERNATIONAL TRAFFIC
§ 10.41 Instruments; exceptions.
(a) Locomotives and other railroad
equipment, trucks, buses, taxicabs, and
other vehicles used in international
traffic shall be subject to the treatment provided for in part 123 of this
chapter.
(b) [Reserved]
(c) Foreign-owned aircraft arriving in
the United States shall be subject to
the treatment provided for in part 122
of this chapter, unless entered under
the provisions of §§ 10.31, 10.183, or paragraph (d) of this section.
(d) Any foreign-owned locomotive or
other railroad equipment, truck, bus,
taxicab, or other vehicle, aircraft, or
undocumented boat brought into the
United States for the purpose of carrying merchandise or passengers between points in the United States for
hire or as an element of a commercial
transaction, except as provided at
§§ 123.12 (a) and (b), 123.14(c), and
141.4(b)(4), is subject to treatment as an
importation of merchandise from a foreign country and a regular entry for
such vehicle, aircraft or boat will be
made. The use of any such vehicle, aircraft, or boat without a proper entry
having been made may result in liabilities being incurred under section 592,
Tariff Act of 1930, as amended (19
U.S.C. 1592).
(e) [Reserved]
(f) Material for the maintenance or
repair of international cables under the
high seas, if requiring storage in special tanks for preservation, may be
placed in tanks specially bonded for
the purpose and withdrawn therefrom
for high-seas installation without the
payment of duty and without limitation of the storage period to the usual
3-year warehousing period. International cables laid under the territorial waters of the United States but

§ 10.41a

not brought on shore in the United
States shall be admitted without entry
or the payment of duty. With respect
to international cables laid under the
territorial waters of the United States
but brought on shore in the United
States, only that part of the cable in
the United States between the point of
entry into the territorial waters of the
United States and the first point of
support on land in the United States
shall be admitted without the payment
of duty.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 70–121, 35 FR 8222, May 26, 1970; T.D. 79–
160, 44 FR 31956, June 4, 1979; T.D. 84–109, 49
FR 19450, May 8, 1984; T.D. 88–12, 53 FR 9315,
Mar. 22, 1988; T.D. 93–66, 58 FR 44130, Aug. 19,
1993; T.D. 99–79, 64 FR 61205, Nov. 10, 1999]

§ 10.41a Lift vans, cargo vans, shipping
tanks, skids, pallets, and similar instruments of international traffic;
repair components.
(a)(1) Lift vans, cargo vans, shipping
tanks, skids, pallets, caul boards, and
cores for textile fabrics, arriving
(whether loaded or empty) in use or to
be used in the shipment of merchandise
in international traffic are hereby designated as ‘‘instruments of international traffic’’ within the meaning of
section 322(a), Tariff Act of 1930, as
amended. The Commissioner of Customs is authorized to designate as instruments of international traffic, in
decisions to be published in the weekly
Customs Bulletin, such additional articles or classes of articles as he shall
find should be so designated. Such instruments may be released without
entry or the payment of duty, subject
to the provisions of this section.
(2) Repair components, accessories,
and equipment for any container of foreign production which is an instrument
of international traffic may be entered
or withdrawn from warehouse for consumption without the deposit of duty if
the person making the entry or withdrawal from warehouse files a declaration that the repair component was imported to be used in the repair of a container of foreign production which is
an instrument of international traffic,
or that the accessory or equipment is
for a container of foreign production
which is an instrument of international traffic. The port director must

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§ 10.41a

19 CFR Ch. I (4–1–11 Edition)

be satisfied that the importer of the repair component, accessory, or equipment had the declared intention at the
time of importation.
(3) As used in this section, ‘‘instruments of international traffic’’ includes
the normal accessories and equipment
imported with any such instrument
which is a ‘‘container’’ as defined in Article 1 of the Customs Convention on
Containers.
(b) The reexportation of a container,
as defined in Article 1 of the Customs
Convention on Containers, which has
become badly damaged, shall not be required in the case of a duly authenticated accident if the container (1) is
subjected to applicable import duties
and import taxes, or (2) is abandoned
free of all expense to the Government
or destroyed under Customs supervision at the expense of the parties
concerned, following the procedure
outlined in § 158.43(c) of this chapter.
Any salvaged parts and materials shall
be subjected to applicable import duties and import taxes. Replaced parts
which are not reexported shall be subjected to import duties and import
taxes except where abandoned free of
expense to the Government or destroyed under Customs supervision at
the expense of the parties concerned.
(c) The instruments of international
traffic designated in paragraph (a) of
this section may be released in accordance with the provisions of that paragraph only after the applicant for such
release has filed a bond on Customs
Form 301, containing the bond conditions set forth in § 113.66 of this chapter. The required application may be
filed at the port of arrival or at a subsequent port to which an instrument
shall have been transported in bond or
to which a container shall have been
moved under cover of a TIR carnet (see
part 114 of this chapter) showing the
characteristics and value of the container on the Goods Manifest of the
carnet. If the container is listed on the
Goods Manifest of the carnet, the application may be filed at the port of arrival or at the subsequent port. If the
container is not listed on the Goods
Manifest, the application shall be filed
at the port of arrival. When the application is filed at a port other than the

port at which the bond is on file, the
following procedure applies:
(1) When the application is filed before the fact of approval of the applicant’s bond has been established, the
applicant must submit with the application, or the Customs officer to whom
the application is made must obtain,
evidence that a current bond is on file
at another port. That evidence may
consist of a certified copy of the bond,
or any other evidence which will satisfy the Customs officer to whom the
application is made that a current
bond is on file at another port.
(2) If the application is filed after the
fact of approval of the applicant’s bond
has been established, a certified copy
of that bond need not be filed at the
port of release. Upon determination by
the appropriate Customs officer that
the fact of approval of the applicant’s
bond has been established, and the
bond has not been subsequently discontinued, the instruments of international traffic will be released as provided for in paragraph (a) of this section.
(3) Upon the request of the applicant,
the appropriate Customs officer at the
port at which the instruments of international traffic are to be released will
determine whether or not the fact of
approval of the applicant’s bond has
been established. If the approval has
not been established, the Customs officer with whom the application has
been filed will advise the applicant of
the nature of the evidence required to
establish the fact that a current bond
is on file at another port.
(d) If an instrument of foreign origin,
or of United States origin which has
been increased in value or improved in
condition by a process of manufacture
or other means while abroad, is released under this section and is subsequently diverted to point-to-point local
traffic within the United States, or is
otherwise withdrawn in the United
States from its use as an instrument of
international traffic, it becomes subject to entry and the payment of any
applicable duties. An instrument of
United States origin which has not
been increased in value or improved in
condition by a process of manufacture
or other means while abroad and which
is released under this section shall not

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U.S. Customs and Border Protection, DHS; Treasury
be subject to entry or the payment of
duty if it is so diverted or otherwise
withdrawn.
(e) The person who filed the application for release under paragraph (a)(1)
of this section shall promptly notify a
director of a port of entry in the
United States as defined in Section
401(k), Tariff Act of 1930, as amended,
(1) that the container is to be abandoned or destroyed, as described in
paragraph (b) of this section, or (2) that
the instrument is the subject of a diversion or withdrawal as described in
paragraph (d) of this section, in which
event he shall file with the port director a consumption entry for the instrument and pay all import duties and import taxes due on the container or instrument at the rate or rates in effect
and in its condition on the date of such
diversion or withdrawal.
(f)(1) Except as provided in paragraph
(j) of this section, an instrument of
international traffic (other than a container as defined in Article 1 of the
Customs Convention on Containers
that is governed by paragraphs (g) (1)–
(3) of this section) may be used as follows in point-to-point traffic, provided
such traffic is incidental to the efficient and economical utilization of the
instrument in the course of its use in
international traffic:
(i) Picking up and delivering loads at
intervening points in the United States
while en route between the port of arrival and the point of destination of its
imported cargo; or
(ii) Picking up and delivering loads
at intervening points in the United
States while en route from the point of
destination of imported cargo to a
point where export cargo is to be loaded or to an exterior port of departure
by a reasonably direct route to, or
nearer to, the place of such loading or
departure.
(2) Neither use as enumerated in
paragraph (f)(1)(i) or (ii) of this section
constitutes a diversion to unpermitted
point-to-point local traffic within the
United States or a withdrawal of an instrument in the United States from its
use as an instrument of international
traffic under this section.
(g)(1) Except as provided in paragraph (j) of this section, a container (as
defined in Article 1 of the Customs

§ 10.41a

Convention on Containers) that is designated as an instrument of international traffic is deemed to remain in
international traffic provided that the
container exits the U.S. within 365 days
of the date on that it was admitted
under this section. An exit from the
U.S. in this context means a movement
across the border of the United States
into a foreign country where either:
(i) All merchandise is unladen from
the container; or
(ii) Merchandise is laden aboard the
container (if the container is empty).
(2) The person who filed the application for release under paragraph (a)(1)
of this section is responsible for keeping and maintaining such records, otherwise generated and retained in the
ordinary course of business, as may be
necessary to establish the international movements of the containers.
Such records shall be made available
for inspection by Customs officials
upon reasonable notice.
(3) If the container does not exit the
U.S. within 365 days of the date on
which it is admitted under this section,
such container shall be considered to
have been removed from international
traffic, and entry for consumption
must be made within 10 business days
after the end of the month in which the
container is deemed removed from
international traffic. When entry is required under this section, any containers considered removed from international traffic in the same month
may be listed on one entry. Such entry
may be made at any port of entry.
Under 19 U.S.C. 1484(a)(1)(B), the importer of record is required, using reasonable care, to complete the entry by
filing with Customs the declared value,
classification and rate of duty applicable to the merchandise. The importer
of record must use the value of the container as determined in accordance
with section 402, Tariff Act of 1930 (19
U.S.C. 1401a), as amended by the Trade
Agreements Act of 1979 (TAA).
(h) For failure promptly to report the
diversion or withdrawal or promptly to
make the required entry and pay the
duties due, the applicant shall be liable
for the payment of liquidated damages
equal to the domestic value of the instrument established in accordance
with Section 606, Tariff Act of 1930.

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§ 10.41b

19 CFR Ch. I (4–1–11 Edition)

(i) When an instrument of international traffic, as provided in paragraph (a) of this section, is returned to
the United States and released in accordance with the provisions of that
paragraph, any repairs which may have
been made to the instrument while it
was abroad are not subject to entry or
the payment of duty whether the instrument is of foreign or domestic
manufacture, whether it left the
United States empty or loaded, and
whether or not the repairs made abroad
were in contemplation when the instrument left the United States.
(j) Containers and other articles designated as instruments of international
traffic in accordance with this section
are nevertheless subject to the application of the coastwise laws of the United
States, with particular reference to
Section 883, Title 46, United States
Code (see § 4.93 of this chapter).
[28 FR 14663, Dec. 31, 1963]
EDITORIAL NOTE: For FEDERAL REGISTER citations affecting § 10.41a, see the List of CFR
Sections Affected, which appears in the
Finding Aids section of the printed volume
and at www.fdsys.gov.

§ 10.41b Clearance of serially numbered substantial holders or outer
containers.
(a) The holders and containers described in this section may be released
without entry or the payment of duty,
subject to the provisions of this section.
(b) Subject to the approval of a port
director pursuant to the procedures described in this paragraph, certain
foreign- or U.S.-made shipping devices
arriving from Canada or Mexico, including racks, holders, pallets, totes,
boxes and cans, need not be serially
numbered or marked if they are always
transported on or within either intermodal and similar containers or containers which are themselves vehicles
or vehicle appurtenances and accessories such as twenty and forty foot
containers of general use and ‘‘igloo’’
air freight containers. The following or
similar notation shall appear on the
vehicle or vessel manifest in relation
to such shipping devices which are exempt from serial numbering or marking requirements pursuant to this
paragraph: ‘‘The shipping devices trans-

ported herein, which are not serially
numbered or marked, have been exempted from such requirement pursuant to an application approved under 19
CFR 10.41b(b).’’ Also, pallets and other
solid wood shipping devices must be accompanied by an importer document,
to the extent that this is required by
the U.S. Department of Agriculture,
Animal and Plant Health Inspection
Service, attesting to the admissibility
of such devices as regards plant pest
risk, as provided for in 7 CFR 319.40–3.
(1) An importer or his agent, regardless of whether the importer is the
owner of the foreign- or U.S.-manufactured shipping devices, may apply to a
port director of Customs at one of the
importer’s chiefly utilized Customs
ports or the port within which the importer’s or agent’s recordkeeping center is located for permission to have
such shipping devices arriving from
Canada or Mexico released without
entry and payment of duty at the time
of arrival and without the devices
being serially numbered or marked.
Application may be filed in only one
port. Although no particular format is
specified for the application, it must
contain the information enumerated in
paragraph (b)(2) of this section. Any
duty which may be due on these shipping devices shall be tendered and paid
cumulatively at the time specified in
an approved application, which may be
either before or after the arrival of the
shipping devices in the U.S. (such as, at
the time a contract, purchase order or
lease agreement is issued).
(2) The application shall:
(i) Describe the types of shipping devices covered, their classification
under the Harmonized Tariff Schedule
of the U.S. (HTSUS), their countries of
origin, and whether and to whom required duty was paid for them or when
it will be paid for them, including duties for repair and modifications to
such shipping devices while outside the
U.S.;
(ii) Identify the intended ports where
it is anticipated the shipping devices
will be arriving and departing the U.S.,
as well as the particular movements
and conveyances in which they are intended to be utilized;

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U.S. Customs and Border Protection, DHS; Treasury
(iii) Describe the applicant’s proposed program for accounting for and
reporting these shipping devices;
(iv) Identify the reporting period
(which shall in no event be less frequent than annual), as well as the payment period within which applicable
duty and fees must be tendered (which
shall in no event exceed 90 days following the close of the related reporting period);
(v) Describe the type of inventory
control and recordkeeping, including
the specific records, to be maintained
to support the reports of the shipping
devices; and
(vi) Provide the location in the
United States, including the name and
address, where the records supporting
the reports will be retained by law and
will be made available for inspection
and audit upon reasonable notice. (The
records supporting the reports of the
shipping devices must be kept for a period of at least 3 years from the date
such reports are filed with the port director.)
(3) The application shall be filed
along with a continuous bond containing the conditions set forth in
§ 113.66(c) of this chapter. If the application is approved by the port director
and the conditions set forth in the application or of the bond are violated,
the port director may issue a claim for
liquidated damages equal to the domestic value of the container. If the domestic value exceeds the amount of the
bond, the claim for liquidated damages
will be equal to the amount of the
bond.
(4) The port director receiving the application shall evaluate the program
proposed to account for, report and
maintain records of the shipping devices. The port director may suggest
amendments to the applicant’s proposal. The port director shall notify
the applicant in writing of his decision
on the application within 90 days of its
receipt, unless this period is extended
for good cause and the applicant is so
informed in writing. Approval of the
application by the port director with
whom it is filed shall be binding on all
Customs ports nationwide.
(5) If the decision is to deny the application, in whole or in part, the port
director shall specify the reason for the

§ 10.41b

denial in a written reply, and inform
the applicant that such denial may be
appealed to the Assistant Commissioner, Office of Field Operations, Customs Headquarters, within 21 days of
its date. The Assistant Commissioner’s
decision shall be issued, in writing,
within 30 days of the receipt of the appeal, and shall constitute the final Customs determination concerning the application.
(6) If the application is approved, an
importer may later apply to amend his
application to add or delete particular
types of shipping devices listed in the
application in which the procedures set
forth in the application may be utilized. If a requested amendment to an
approved application should be denied,
or if an approved application should be
revoked, in whole or in part, by the
port director, the procedures described
in paragraph (b)(5) of this section shall
apply.
(7) Application for and approval of a
reporting program shall not limit or
restrict the use of other alternative
means for obtaining the release of
holders, containers and shipping devices.
(c) In the case of serially numbered
holders or containers of United States
manufacture for which free clearance
under
subheading
9801.00.10,
Harmonized Tariff Schedule of the United
States, is claimed, the owner shall
place thereon the following markings:
(1) 9801.00.10, unless the holder or container has permanently attached thereto the manufacturer’s metal tag or
plate showing, among other things, the
name and address of the manufacturer
who is located in the United States.
(2) The name of the owner, either positioned as indicated in the example
below, or elsewhere conspicuously
shown on the holder or container.
(3) The serial number assigned by the
owner, which shall be one of consecutive numbers and not to be duplicated.
For example: 9801.00.10 * * * Zenda
* * * 2468.
(d)(1) In the case of serially numbered holders or containers of foreign
manufacture, other than those provided for in paragraph (d)(2) of this section, for which free clearance under the
second
provision
in
subheading
9803.00.50, HTSUS (19 U.S.C. 1202), is

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§ 10.41b

19 CFR Ch. I (4–1–11 Edition)

claimed, the owner shall place thereon
the following markings:
(i) 9803.00.50.
(ii) The district and port code numbers of the port of entry, the entry
number, and the last two digits of the
fiscal year of entry covering the importation of the holders and containers on
which duty was paid.
(iii) The name of the owner, either
positioned as indicated in the example
below, or elsewhere conspicuously
shown on the holder or container.
(iv) The serial number assigned by
the owner, which shall be one of consecutive numbers and not to be duplicated. For example: 9803.00.50 * * * 10–
1–366–63 * * * Zenda * * * 2468.
(2) In the case of substantial holders
or containers of either U.S. or foreign
manufacture, specially designed and
equipped to facilitate the carriage of
goods by one or more modes of transport without intermediate reloading,
each having a gross mass rating of at
least 18,120 kilograms, for which dutyfree entry is requested under either the
first or the second proviso in subheading 9803.00.50, HTSUS (19 U.S.C.
1202), is claimed, only the following
clear, conspicuous and durable markings are required to be on the container:
(i) The identity of the owner or operator of the container.
(ii) The serial number assigned by
the owner or operator of the container,
which shall be one of consecutive numbers and shall not be duplicated.
(e) The prescribed markings shall be
clear and conspicuous, that is, they
shall appear on an exposed side of the
holder or container in letters and figures of such size as to be readily discernible. The markings will be stricken
out or removed when the holders or
containers are taken out of service or
when ownership is transferred, except
that appropriate changes may be made
if a new owner wishes to use the holders and containers under this procedure.
(f) The owner shall keep adequate
records open to inspection by Customs
officers, which shall show the current
status of the serially numbered holders
and containers in service and the disposition made of such holders and containers taken out of service.

(g) Nothing in this procedure shall be
deemed to affect:
(1) The requirements for outward or
inward manifesting of such holders or
containers. The manifests will show for
each holder or container its markings
as provided for herein.
(2) The requirements of the Department of Commerce on exportation with
respect to the filing of ‘‘Shipper’s Export Declaration,’’ Form 7525–V.
(3) The treatment of articles covered
herein under the coastwise laws of the
United States, with particular reference to section 883, Title 46, United
States Code.
(h) If the holder or container and its
contents are to move in bond or under
cover of a TIR carnet (see part 114 of
this chapter) from the port of arrival
intact, the holder or container shall
appear on the inward foreign manifest
so as to be related to the cargo contained therein and will be released
under this procedure at a subsequent
port. If the holder or container is to
move in bond or under cover of a TIR
carnet from the port of arrival not intact with its contents, the holder or
container may appear on the inward
foreign manifest separate from and not
related to the cargo contained therein
and will be released under this procedure at the port of arrival before it
moves forward and will not appear on
the in-bond document.
(i) A continuous bond containing the
conditions set forth in § 113.66 of this
chapter shall be filed with the port director. If the conditions are violated
the port director shall issue a claim for
liquidated damages equal to the domestic value of the holder or container established in accordance with section
606, Tariff Act of 1930, as amended (19
U.S.C. 1606). If the domestic value exceeds the amount of the bond the claim
for liquidated damages will be equal to
the amount of the bond.
[T.D. 56542, 30 FR 15143, Dec. 8, 1965, as
amended by T.D. 71–70, 36 FR 4485, Mar. 6,
1971; T.D. 84–213, 49 FR 41165, Oct. 19, 1984;
T.D. 86–13, 51 FR 4164, Feb. 3, 1986; T.D. 89–1,
53 FR 51249, Dec. 21, 1988; T.D. 96–20, 61 FR
7989, Mar. 1, 1996; T.D. 97–82, 62 FR 51769, Oct.
3, 1997; T.D. 99–64, 64 FR 43265, Aug. 10, 1999]

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U.S. Customs and Border Protection, DHS; Treasury
ARTICLES FOR INSTITUTIONS
§ 10.43 Duty-free status.
(a) The port director may, at his discretion, require appropriate proof of
duty-free status for articles for institutions claimed to be exempt from duty
under subheadings 9810.00.05, 9810.00.15,
9810.00.25, 9810.00.30, 9810.00.40, 9810.00.45,
9810.00.50, 9810.00.55, Harmonized Tariff
Schedule of the United States (19
U.S.C. 1202).
(b) Appropriate proof may be a copy
of the charter or other evidence of the
character of the institution for the use
of which the articles are imported.
[T.D. 85–123, 50 FR 29953, July 23, 1985, as
amended by T.D. 89–1, 53 FR 51249, Dec. 21,
1988]

§ 10.46 Articles for the United States.
Pursuant to subheadings 9808.00.10
and 9808.00.20, books, engravings, and
other articles therein enumerated,
which are imported by authority or for
the use of the United States or for the
use of the Library of Congress, shall be
admitted free of duty upon the written
request of the head of the bureau or executive department concerned.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 67–108, 32 FR 6392, Apr. 25, 1967; T.D. 89–
1, 53 FR 51249, Dec. 21, 1988; T.D. 97–82, 62 FR
51769, Oct. 3, 1997]

§ 10.47

[Reserved]

§ 10.49

made from the original work or model;
and in the case of etchings, engravings,
woodcuts, lithographs, or prints made
by other hand-transfer processes, that
they were printed by hand from handetched, hand-drawn, or hand-engraved
plates, stones, or blocks:
I, llll, do hereby declare that I am the
producer, seller, shipper or importer of certain works of art, namely llll covered by
the annexed invoice dated llll; that any
sculptures or statuary included in that invoice are the original works or models or one
of the first twelve castings, replicas, or reproductions made from the sculptor’s original work or model; and that any etchings,
engravings, woodcuts, lithographs, or prints
made by other hand-transfer processes included in that invoice were printed by hand
from hand-etched, hand-drawn, or hand-engraved plates, stones, or blocks.

(c) The port director may waive the
declaration requirement set forth in
paragraph (b) of this section.
(d)
Artists’
proof
etchings,
engravings, woodcuts, lithographs, or
prints made by other hand-transfer
processes should bear the genuine signature or mark of the artist as evidence of their authenticity. In the absence of such a signature or mark,
other evidence shall be required which
will establish the authenticity of the
work to the satisfaction of the port director.
[T.D. 94–3, 58 FR 68742, Dec. 29, 1993]

WORKS OF ART
§ 10.48 Engravings, sculptures, etc.
(a) Invoices covering works of art
claimed to be free of duty under subheadings
9702.00.00
and
9703.00.00,
HTSUS, shall show whether they are
originals, replicas, reproductions, or
copies, and also the name of the artist
who produced them, unless upon examination the Customs officer is satisfied
that such statement is not necessary to
a proper determination of the facts.
(b) The following evidence shall be
filed in connection with the entry: A
declaration in the following form by
the artist who produced the article, or
by the seller, shipper or importer,
showing whether it is original, or in
the case of sculpture, the original work
or model, or one of the first twelve
castings, replicas, or reproductions

§ 10.49 Articles for exhibition; requirements on entry.
(a) There shall be filed in connection
with the entry of works of art and
other articles claimed to be free of
duty under Chapter 98, Subchapter XII,
Harmonized Tariff Schedule of the
United States (HTSUS), a declaration
by a qualified officer of the institution
in sufficient detail to demonstrate entitlement to entry as claimed, and a
bond on Customs Form 301, containing
the bond conditions set forth in § 113.62
of this chapter. Claim for free entry
under Chapter 98, Subchapter XII may
be made for articles of the character
described therein which have been previously entered under any other provision of law and the entry amended accordingly upon compliance with the requirements of this section, provided

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§ 10.50

19 CFR Ch. I (4–1–11 Edition)

the articles have not been released
from Customs custody.
(b) The port director may require a
copy of the charter or other evidence of
the character of the institution for
which the articles are imported, and
may also require the production of the
original of any order given by such society or institution to any importing
agent or dealer for such articles. The
society or institution shall file, within
6 months after the date of filing the
entry, any document or proof demanded by the port director in connection with the entry.
(c) Articles entered under subheading
9812.00.20, HTSUS, may be transferred
from one institution to another upon
an application in writing in the case of
each transfer describing the articles
and stating the name of the institution
to which transfer is to be made, provided the sureties to the bond assent in
writing under seal or a new bond is
filed. No entry or withdrawal shall be
required for such a transfer.
(d) If any of the articles accorded free
entry under Chapter 98, Subchapter XII
shall be sold, offered or exposed for
sale, transferred, or used in any manner contrary to the provisions of the
regulations in this part, within 5 years
after the date of entry under such part,
the amount of the duties shall be collected immediately by the director of
the port of entry and deposited as duties. If the articles are exported or destroyed under Customs supervision
within such 5-year period, the liability
under the bond shall be treated as terminated.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 84–213, 49 FR 41166, Oct. 19, 1984; T.D. 89–
1, 53 FR 51249, Dec. 21, 1988; T.D. 92–85, 57 FR
40605, Sept. 4, 1992]

§ 10.50

[Reserved]

§ 10.52 Painted, colored or stained
glass windows for religious institutions.
When painted, colored, or stained
glass windows or parts thereof, are
claimed free of duty under subheading
9810.00.10, Harmonized Tariff Schedule
of the United States (19 U.S.C. 1202),
the port director may, at his discretion, require appropriate proof that the
importation was designed by, and pro-

duced by or under the direction of, a
professional artist, and that it is for
the use of an institution established
solely for religious purposes.
[T.D. 85–123, 50 FR 29953, July 23, 1985, as
amended by T.D. 89–1, 53 FR 51250, Dec. 21,
1988]

§ 10.53 Antiques.
(a) Articles accompanying a passenger and entitled to entry under the
passenger’s declaration and entry, or
articles entered under an informal
entry which are claimed to be free of
duty under subheading 9706.00.00, Harmonized Tariff Schedule of the United
States (HTSUS), may be admitted free
of duty upon the execution of a declaration on the face of the entry provided that the passenger or person filing the informal entry is the owner of
the articles and that they are for his
personal use and not for sale or other
commercial use and provided the Customs officer concerned is satisfied that
the articles are of the requisite age.
(b) Antiques of the age prescribed by
subheading 9706.00.00, HTSUS, or admitted under the provisions of paragraph (e) of this section, shall be admitted free of duty though repaired or
renovated. If, however, an antique has
been repaired with a substantial
amount of additional material, without
changing the original form or shape,
the original and added portions shall be
appraised and reported as separate entities and the basis for such report
shall be plainly indicated on the invoice by the appraiser. In such cases
duty shall be assessed on the portion
added. If the repairs consist of an addition to an article of a feature which
changes it substantially from the article originally produced, or if the antique portion has otherwise been so
changed as to lose its identity as the
article which was in existence prior to
the time prescribed in subheading
9706.00.00, HTSUS, the entire article
shall be excluded from free entry under
subheading 9706.00.00, HTSUS.
(c) Except for furniture admitted
under the provisions of paragraph (e) of
this section, furniture claimed to be
free
of
duty
under
subheading
9706.00.00, Harmonized Tariff Schedule
of the United States (HTSUS) may be
entered for consumption at any port of

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U.S. Customs and Border Protection, DHS; Treasury
entry within the customs territory of
the United States. Furniture as used in
this section of the regulations is defined as ‘movable articles of convenience or decoration for use in furnishing a house, apartment, place of
business or accommodation’. This definition embraces most articles claimed
to be free of duty as antiques.
(d) A claim for the free entry of an
article under subheading 9706.00.00,
HTSUS on the basis of antiquity may
be made on the entry, or filed after
entry at any time prior to liquidation
of the entry, provided the article has
not been released from Customs custody or it has been found upon examination before such release to be described
in
subheading
9706.00.00,
HTSUS.
(e) Antique articles otherwise prohibited entry by the Endangered Species
Act of 1973 (16 U.S.C. 1521, et seq.) may
be entered if:
(1) The article is composed in whole
or in part of any endangered or threatened species listed in 50 CFR 17.11 or
17.12,
(2) The article is not less than 100
years of age,
(3) The article has not been repaired
or modified with any part of any such
endangered or threatened species, on or
after December 28, 1973,
(4) The article is entered at a port
designated in § 12.26 of this chapter,
(5) A Declaration for Importation or
Exportation of Fish or Wildlife
(USFWS Form 3–177) is filed at the
time of entry with the port director
who will forward the form to the U.S.
Fish and Wildlife Service, and
(6) The importer meets the requirements of paragraph (a) of this section.
(f) The additional duty imposed by
additional U.S. Note 2, Chapter 97,
HTSUS, shall apply to any article
which is imported for sale and claimed,
either at the time of entry or at a later
date, to be free of duty under subheading 9706.00.00, HTSUS, if such article is later found to be unauthentic in
respect of the antiquity claimed as a
basis for such free entry, unless the
claim under subheading 9706.00.00,
HTSUS, is withdrawn in writing before
the examination of the article for the
purpose of appraisement or classification has begun.

§ 10.56

(g) The additional duty provided for
in additional U.S. Note 2, Chapter 97,
HTSUS shall not be assessed if the importer established by evidence satisfactory to the port director that the article was not imported for sale. In the
case of any article imported in a passenger’s baggage or entered under an
informal entry, the Customs officer
concerned may accept the statement of
the owner that the article was not imported for sale if he is satisfied of the
truth of such statement.
[28 FR 14663, Dec. 31, 1963]
EDITORIAL NOTE: For FEDERAL REGISTER citations affecting § 10.53, see the List of CFR
Sections Affected, which appears in the
Finding Aids section of the printed volume
and at www.fdsys.gov.

§ 10.54 Gobelin and other hand-woven
tapestries.
Pursuant to subheading 5805.00.10,
Harmonized Tariff Schedule of the
United States, Gobelin tapestries produced in the Manufacture Nationale
des Gobelins factories at Paris and
Beauvais under the direction and control of the French Government, and
other hand-woven tapestries, shall be
accorded free entry if of a kind fit only
for use as wall hangings, and valued
over $215 per square meter.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 87–75, 52 FR 20066, May 29, 1987; T.D. 89–
1, 53 FR 51250, Dec. 21, 1988]

VEGETABLE OILS
§ 10.56 Vegetable oils, denaturing; release.
(a) Olive, palm-kernel, rapeseed, sunflower, and sesame oil shall be classifiable under subheadings 1509.10.20,
1509.10.40, 1509.90.20, 1509.90.40, 1510.00.20,
1512.19.20, 1513.29.00, 1514.90.10, 1514.90.50,
1515.50.00, Harmonized Tariff Schedule
of the United States, if denatured
abroad or under Customs supervision
after importation but before release
from Customs custody, at the request
and expense of the importer, by a formula prescribed by Headquarters, U.S.
Customs Service, or if by their method
of production abroad they are rendered
unfit for use as food or for any but mechanical or manufacturing purposes.

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§ 10.57

19 CFR Ch. I (4–1–11 Edition)

(b) Each cask or package of oil
claimed to have been before importation denatured or otherwise rendered
unfit for use as food or for any but mechanical or manufacturing purposes
shall be sampled and tested by an appraising officer.
(c) Formulas prescribed by Headquarters, U.S. Customs Service, except
proprietary mixtures, will be circulated to all Customs officers and will
appear as abstracts of United States
Customs Service decisions published in
the weekly Customs Bulletins. Proprietary mixtures approved by the Commissioner of Customs will not be published but appropriate notice of their
approval will be given to all Customs
officers.
(d) The Headquarters, U.S. Customs
Service, will from time to time prescribe additional formulas, and will
consider any formula for special denaturing that may be submitted.
(e) The port director may, if he
deems it advisable, require an importer
requesting permission to use any authorized denaturant to submit to the
appraiser an adequate sample of such
denaturant, in order that the appraiser
may report to the port director whether or not such denaturant is suitable
for rendering the oil unfit for use as
food or for any but mechanical or manufacturing purposes.
(f) No such oil shall be released free
of duty until the appraiser shall have
made a special report that it has been
properly denatured.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 66–182, 31 FR 11416, Aug. 30, 1966; T.D. 87–
75, 52 FR 20066, May 29, 1987; T.D. 89–1, 53 FR
51250, Dec. 21, 1988]

POTATOES, CORN, OR MAIZE
§ 10.57 Certified seed
seed corn or maize.

potatoes,

country in which the contents were
grown, or an agency of such government. The tag shall bear a certificate
to the effect that the specified contents
of the container were grown, and have
been approved, especially for use as
seed. The tag shall also bear a number
or other symbol identifying the potatoes or corn in the container with an
inspection record of the foreign government or its agency on the basis of
which the certificate was issued.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 89–1, 53 FR 51250, Dec. 21, 1988]

BOLTING CLOTHS
§ 10.58 Bolting cloths; marking.
(a) As a prerequisite to the free entry
of bolting cloth for milling purposes
under
subheading
5911.20.20,
Harmonized Tariff Schedule of the United
States, the cloth shall be indelibly
marked from selvage to selvage at intervals of not more then 10.16 centimeters with ‘‘bolting cloth expressly
for milling purposes’’ in block letters
7.62 centimeters in height. Bolting
cloths composed of silk imported expressly for milling purposes shall be
considered only such cloths as are suitable for and are used in the act or process of grading, screening, bolting, separating, classifying, or sifting dry materials, or dry materials mixed with
water, if the water is merely a carrying
medium.
(b) Bolting cloths not marked in the
manner above indicated at the time of
importation may be so marked by the
importers in public stores under the supervision of customs officers.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 87–75, 52 FR 20066, May 29, 1987; T.D. 89–
1, 53 FR 51250, Dec. 21, 1988]

and

Claim for classification as seed potatoes under subheading 0701.10.00, as
seed corn (maize) under subheading
1005.10., HTSUS, shall be made at the
time of entry. Such classification shall
be allowed only if the articles are
white or Irish potatoes, or maize or
corn, imported in containers and if, at
the time of importation, there is firmly
affixed to each container an official tag
supplied by the government of the

WITHDRAWAL OF SUPPLIES AND
EQUIPMENT FOR VESSELS
§ 10.59 Exemption from customs duties
and internal-revenue tax.
(a) A vessel shall not be considered to
be actually engaged in the foreign
trade, or in trade between the Atlantic
and Pacific ports of the United States,
or between the United States and its
possessions, or between Hawaii and any
other part of the United States or between Alaska and any other part of the

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U.S. Customs and Border Protection, DHS; Treasury
United States, as the case may be, for
the purpose of withdrawing supplies
free of duty and internal-revenue tax
pursuant to section 309(a), Tariff Act of
1930, as amended, unless it is—
(1) Operating on a regular schedule in
a class of trade which entitles it to the
privilege;
(2) Actually transporting passengers
or merchandise to or from a foreign
port, a port on the opposite coast of
the United States, or between a port in
a possession of the United States and a
port in the United States or in another
of its possessions, or between Hawaii
and any other part of the United States
or between Alaska and any other part
of the United States;
(3) Departing in ballast (without
cargo or passengers) from one port for
another, domestic or foreign, for the
purpose of lading passengers or cargo
at the port of destination for carriage
in a class of trade specified in section
309(a), Tariff Act of 1930, as amended,
for which class of trade the vessel is
suitable and substantially ready for
service with necessary fittings, outfit,
and equipment already installed on its
departure in ballast, and from which it
is not diverted prior to carriage of passengers or cargo in such trade. A written declaration of the owner or agent
of the vessel may be required in connection with the withdrawal, certifying
to the vessel’s suitableness and substantial readiness with necessary fittings, outfit, and equipment already installed on its departure in ballast for
service in a class of trade specified in
section 309 and agreeing to notify the
port director if it is laid up or diverted
from such class of trade prior to the
carriage of cargo or passengers in such
trade.
(b) A withdrawal of articles may not
be made under section 309, Tariff Act of
1930, as amended, for use on a trial or
test trip of a vessel preparatory to its
actually engaging in trades.
(c) The classes of articles which may
be withdrawn as provided for by section 309, Tariff Act of 1930, as amended,
include the containers in which the articles are withdrawn and laden even
though for tariff purposes the containers are classifiable separately from
their contents, except unusual containers within the purview of General

§ 10.59

Rule of Interpretation 5, Harmonized
Tariff Schedule of the United States
(HTSUS).
(d) For the purpose of allowing the
privileges of section 309, Tariff Act of
1930, as amended, to aircraft as provided for therein, an aircraft shall be
deemed to be a vessel within the meaning of each provision of this section
and of §§ 10.60 through 10.64 which may
be applied to aircraft.
(e) A documented vessel with a fisheries license endorsement and foreign
fishing vessels of 5 net tons or over
may be allowed to withdraw distilled
spirits (including alcohol), wines, and
beer conditionally free under section
309, Tariff Act of 1930, as amended (19
U.S.C. 1309), if the port director is satisfied from the quantity requested, in
the light of (1) whether the vessel is
employed in substantially continuous
fishing activities, and (2) the vessel’s
complement, that none of the withdrawn articles is intended to be removed from the vessel in, or otherwise
returned to, the United States without
the payment of duty or tax. Such withdrawal shall be permitted only after
the approval by the port director of a
special written application, in triplicate, on Customs Form 5125, of the
withdrawer, supported by a bond on
Customs Form 301, containing the bond
conditions set forth in § 113.62 of this
chapter executed by the withdrawer.
Such application shall be filed with
Customs Form 7501 or 7512, as the case
may be. The original and the triplicate
copy of the application, after approval,
shall be stamped with the withdrawal
number and date thereof and shall be
returned to the withdrawer for use as
prescribed below. Approval of each
such application shall be subject to the
condition that the original and the
triplicate copy shall be presented
thereafter by the withdrawer or the
vessel’s master to the port director
within 24 hours (excluding Saturday,
Sunday, and holidays) after each subsequent arrival of the vessel at a Customs port or station and that an accounting shall be made at the time of
such presentation of the disposition of
the articles until the port director is
satisfied that all of them have been
consumed on board, or landed under
Custom’s supervision, and takes up the

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§ 10.59

19 CFR Ch. I (4–1–11 Edition)

original application. (The withdrawer
shall retain the triplicate copy as evidence of consumption on board or landing under Customs supervision.) The
approval shall be subject to the further
conditions that any such withdrawn article remaining on board while the vessel is in port shall be safeguarded in
the manner and to such extent as the
district director for the port or place of
arrival shall deem necessary and that
failure to comply with the conditions
upon which a conditionally free withdrawal is approved shall subject the
total quantity of withdrawn articles to
the assessment and collection of an
amount equal to the duties and taxes
that would have been assessed on the
entire quantity of supplies withdrawn
had such supplies been regularly entered, or withdrawn, for consumption.
Exemption from internal-revenue tax
on distilled spirits, alcohol, wines, and
beer removed from any internal-revenue bonded warehouse, industrial alcohol premises, bonded wine cellar, or
brewery; and drawback on taxpaid distilled spirits or wines removed from an
export storage room, or on taxpaid beer
removed from a brewery (or place of
storage elsewhere), for use as supplies
on vessels under section 309, Tariff Act
of 1930, as amended, are governed by
regulations of the Internal Revenue
Service.
(f) Pursuant to section 309(d) of the
Tariff Act of 1930, as amended, the Department of Commerce has found and
advised the Secretary of the Treasury
of the foreign countries which allow
privileges to aircraft registered in the
United States substantially reciprocal
to those described in sections 309 and
317 of the Tariff Act of 1930, as amended. Advices also have been received of
changes and limitations of privileges
allowed. In accordance with these advices, Treasury decisions are issued extending to the aircraft of foreign countries free withdrawal privileges reciprocal to those found by the Secretary
of Commerce to be extended by those
countries to aircraft registered in the
United States or making changes in
such privileges on the basis of new
findings. Listed below by countries are
the Treasury decisions issued pursuant
to such findings which are currently in
effect:

Country

Treasury
Decision(s)

Abu Dhabi ............
Argentina .............

95–45
54925 (1)
92–20

Australia ...............

54747 (1)

Austria ..................
Bahamas ..............
Bahrain ................
Belgium ................
Benin ....................
Bermuda ..............
Brazil ....................
Canada ................

80–68
52798 (3)
95–45
52846 (2)
71–215,9349944 (4)
53281 (2)
69–149
69–245

Chile .....................
China* ..................
Colombia ..............
Costa Rica ...........
Cuba ....................

66–128 (2)
82–91
70–107 (1)
53658 (1)
81–198

Czechoslovakia ....
Denmark ..............
Dominican Republic.
Ecuador ...............
Egypt ....................

70–107 (1)
51966 (3)
54522 (1)

El Salvador ..........
Finland .................
France ..................

52510 (4)
74–3
85–141
54675 (1)
69–120 (2)
67–96 (1)

Federal Republic
of Germany.
Greece .................
Guyana ................
Honduras .............
Iceland .................
India .....................
Indonesia .............

54847 (1)
78–28
71–154
67–265 (1)
55155 (1)
90–61

Iran .......................
Ireland ..................
Israel ....................
Italy ......................

75–254
55291 (1)
52831 (3)
69–223

Ivory Coast ..........
Jamaica ...............
Japan ...................

71–215
70–250
53550 (1),
88–45

Jordan ..................
Kenya ...................

74–102
71–102

Lebanon ...............
Luxembourg .........

53902 (1)
89–77

Mexico .................
Morocco ...............
Netherlands .........
Netherlands Antilles.
New Zealand .......

54506 (5)
75–254
52494 (2)
71–211

Nicaragua ............
Norway .................
Oman ...................
Pakistan ...............

54640 (1)
51966 (3)
95–45
55416 (1)

69–150

73–52

Exceptions if any, as
noted—
Applicable only as to aircraft equipment, spare
parts, and supplies.
Not applicable to ground
equipment.

Not applicable to ground
equipment during period
May 1 to September 16,
1969, inclusive.

Applicable only as to aircraft supplies.

Not applicable to tobacco
products under section
317 of the tariff act. Not
applicable to ground
equipment.
Not applicable to ground
equipment.

Applicable only as to aviation fuels and lubricants.

Not applicable to ground
equipment.

Not applicable to ground
support equipment as of
August 1, 1986
Applicable only as to aircraft fuels and lubricants.
Applicable only as to aviation fuels.

Not applicable to ground
equipment.

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U.S. Customs and Border Protection, DHS; Treasury
Country

Treasury
Decision(s)

Panama ...............
Peru .....................
Poland ..................
Portugal ...............

55453 (1)
52911 (2)
72–153
68–107 (1)

Qatar ....................
Republic of Korea
Republic of the
Philippines.
Romania ..............
Saudi Arabia ........

95–45
71–140
71–197
75–35
73–307,
92–68
71–215
93–25
69–162

Senegal ................
Singapore ............
South Africa .........
Spain ....................
Sweden ................
Switzerland ..........
Taiwan .................
Tanzania ..............

54522 (2)
51966 (3)
56047
70–107 (1),
82–91
71–102

Thailand ...............

Exceptions if any, as
noted—

Not applicable to ground
equipment.

Not applicable to ground
equipment.

Not applicable to ground
equipment.
Applicable only as to aircraft fuels and lubricants.

71–138,
89–6
56441 (1)

Trinidad and Tobago.
Turkey ..................
Uganda ................

89–7
71–102

Union of Soviet
Socialist Republics.
United Kingdom ...

67–123 (1)

Venezuela ............
Yugoslavia ...........
Zambia .................

55425 (1)
71–138
89–5

69–176

Applicable only as to aircraft fuels and lubricants.

Not applicable to ground
equipment.

*See also Taiwan

[28 FR 14663, Dec. 31, 1963]
EDITORIAL NOTE: For FEDERAL REGISTER citations affecting § 10.59, see the List of CFR
Sections Affected, which appears in the
Finding Aids section of the printed volume
and at www.fdsys.gov.

§ 10.60 Forms of withdrawals; bond.
(a) Withdrawals from warehouse shall
be made on Customs Form 7501. Each
withdrawal shall contain the statement prescribed for withdrawals in
§ 144.32 of this chapter and all of the
statistical information as provided in
§ 141.61(e) of this chapter. Withdrawals
from continuous Customs custody elsewhere than in a bonded warehouse
shall be made on Customs Form 7512,
except as provided for by paragraph (h)
of this section. When a withdrawal of
supplies or other articles is made
which may be used on a vessel while it
is proceeding in ballast to another port
as provided for by § 10.59(a)(3), a notation of this fact shall be made on the

§ 10.60

withdrawal and the name of the other
port given if known.
(b) If the withdrawal is made by
other than the principal on the warehouse or rewarehouse entry, as the
case may be, the assent of such principal shall be endorsed on the withdrawal, unless the principal has otherwise authorized such withdrawal in
writing.
(c) A bond on Customs Form 301, containing the bond conditions set forth in
§ 113.62 of this chapter shall be taken
when the withdrawal from warehouse
is made by a person other than the
principal on the warehouse or rewarehouse entry, as provided for in paragraph (b) of this section.
(d) Except as otherwise provided in
§ 10.62b, relating to withdrawals from
warehouse of aircraft turbine fuel to be
used within 30 days of such withdrawal
as supplies on aircraft under § 309, Tariff Act of 1930, as amended, when the
supplies are to be laden at a port other
than the port of withdrawal from warehouse, they shall be withdrawn for
transportation in bond to the port of
lading. Three copies of the manifest on
Customs Form 7512, in addition to six
copies of the withdrawal on Customs
Form 7501, shall be required. The procedure shall be the same as that prescribed in § 144.37 of this chapter (the
six copies of Customs Form 7501 taking
the place of the entry copies of Customs Form 7512).
(e) No bond shall be required in the
case of war vessels.
(f) Unless transfer is permitted under
the provisions of paragraph (h) of this
section, when articles are withdrawn
from continuous Customs custody elsewhere than in a bonded warehouse for
lading at the port of withdrawal, the
procedure provided for in § 18.25 of this
chapter shall be followed, except that
the bond required shall be on Customs
Form 301, containing the bond conditions set forth in § 113.62 of this chapter. Unless transfer is permitted under
the provisions of paragraph (h) of this
section, when articles are withdrawn
from continuous Customs custody elsewhere than in a bonded warehouse for
lading at another port, the procedure
set forth in § 18.26 of this chapter shall
be followed, except that the withdrawal
when filed shall be supported by a bond

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§ 10.61

19 CFR Ch. I (4–1–11 Edition)

on Customs Form 301, containing the
bond conditions set forth in § 113.62 of
this chapter. There shall be such examination of the articles as may be necessary to satisfy the port director that
they are subject to the privileges of
section 309, Tariff Act of 1930, as
amended, and that the value and quantity declared for them are correct.
(g) A withdrawal under § 10.59(e) shall
be supported by a bond on Customs
Form 301, containing the bond conditions set forth in § 113.62 of this chapter.
(h) If a request is made for permission to transfer supplies or stores from
one vessel to another which would be
entitled to withdraw them free of duty
and tax under section 309 or 317, Tariff
Act of 1930, as amended, the port director in his discretion may permit the articles to be so transferred under Customs supervision under a permit on
Customs Form 3171 in lieu of a formal
withdrawal under the pertinent statute. In such a case, the pertinent statute shall be indicated by an endorsement made on the permit by the port
director.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 73–175, 38 FR 17445, July 2, 1973; T.D. 73–
312, 38 FR 30882, Nov. 8, 1973; T.D. 84–213, 49
FR 41166, Oct. 19, 1984; T.D. 95–81, 60 FR 52295,
Oct. 6, 1995; T.D. 96–18, 61 FR 6777, Feb. 22,
1996]

§ 10.61 Withdrawal permit.
Upon the filing of the withdrawal and
the execution of the bond, when required, the port director shall issue a
permit on Customs Form 7501 or 7512.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 95–81, 60 FR 52295, Oct. 6, 1995]

§ 10.62 Bunker fuel oil.
(a) Withdrawal under section 309, Tariff
Act of 1930, as amended (19 U.S.C. 1309).
Except as otherwise provided in
§ 10.62b, relating to withdrawals from
warehouse of aircraft turbine fuel to be
used within 30 days of such withdrawal
as supplies on aircraft under section
309, Tariff Act of 1930, as amended (19
U.S.C. 1309), when all the bunker fuel
oil in a Customs bonded tank is intended only for lading duty free as supplies on vessels under section 309 at the
port where the tank is located, delivery
of the oil, by Customs bonded carrier,

cartman, or lighterman (including
bonded pipelines), under withdrawals
on Customs Form 7501, either single or
blanket, may be made without the
presence of a Customs officer. When a
blanket withdrawal is filed and a partial release takes place, the partial release procedure set forth in § 19.6(d) of
this chapter shall be followed for each
partial release. However, each abstract
copy of Customs Form 7501 shall include the following additional information:
(1) Type of oil withdrawn.
(2) Number or other identification of
sales order therefor.
(3) Name of bonded carrier, date it received oil.
(4) Receipt signed by master or other
person in charge of delivering conveyance identified by number, or name,
and if Customs bonded lighterman or
cartman, by the carrier’s license number.
(5) Name and location of vessel obtaining oil.
(6) Quantity and identification of
each type of oil received with date, and
signature and title of receiving officer.
If all the oil is laden on the receiving
vessel at the port of withdrawal via
pipeline from the bonded storage tank,
paragraphs (a) (3) and (4) of this section
shall be deemed to be inapplicable.
(b) If a blanket free withdrawal of
bunker fuel oil is filed, to comply with
Bureau of the Census requirements the
withdrawal on Customs Form 7501 shall
be endorsed ‘‘Estimated Withdrawals’’
and limited to the aggregate quantity
and value of fuel oil which it is estimated will be physically removed from
Customs bond during the calendar
month in which the withdrawal is filed
for lading on vessels entitled to dutyfree vessel supplies under section 309 of
the Tariff Act of 1930, as amended.
(c)(1) As an incident of the delivery of
fuel oils classifiable at different rates
of duty to a vessel or vessels under section 309 of the tariff act, the port director may, when necessary to enable a
supplier to meet fuel specifications,
permit the blending of the oils in the
delivering conveyance or in other suitable facilities after withdrawal from
the bonded tanks, upon the condition
that, to the extent of the amount of oil
withdrawn classifiable at the higher

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U.S. Customs and Border Protection, DHS; Treasury
rate, duty at the higher rate will be
paid on any portion of the blended fuel
oil not delivered within a reasonable
time to a qualified vessel. The withdrawer shall be required to file a withdrawal for consumption for the excess
quantity withdrawn. For example, if
the quantity withdrawn consists of
1,500 barrels of bunker C fuel oil classifiable at the rate of one-eighth cent per
gallon and 500 barrels of diesel oil classifiable at the rate of one-fourth cent
per gallon but only 1,400 barrels of the
blended oil are actually laden as fuel
supplies on qualified vessels, withdrawals for consumption are required
for 500 barrels of diesel oil at the higher rate and for 100 barrels of bunker C
fuel oil at the lower rate.
(2) Delivering transferer receipt. The receipt of the delivering carrier on a copy
of Customs Form 7501 for fuel oil which
has been blended under paragraph (c)(1)
of this section with components classifiable at different rates of duty shall
show, for each warehouse entry number
and withdrawal number involved, the
types and quantity of oil received.
(d) Fuel oil withdrawn as vessel supplies at one port may be laden at another port on a vessel or vessels entitled to the free withdrawal privileges
of section 309 of the tariff act, under
procedures prescribed in this section,
provided the movement to the receiving vessel or vessels is under the bond
of a qualified carrier as described in
§ 18.1(a) of this chapter. In such cases,
the provisions of § 10.60(d) of this chapter shall be deemed inapplicable.
(e) If a vessel not entitled to dutyfree withdrawal of supplies from Customs bonded warehouses under section
309 of the Tariff Act of 1930, as amended, should be supplied with fuel oil
from a Customs bonded tank described
in paragraph (a) of this section because
of an emergency, a duty paid withdrawal therefor shall be filed on the
first day that the customhouse is open
for the general transaction of business
after the day on which the oil is laden
on the using vessel. If there should be
willful or repeated instances of late filing of a duty-paid withdrawal in such
cases, the port director shall require a
duty-paid withdrawal to be filed prior
to the removal of fuel oil from the
bonded tank.

§ 10.62a

(f) When the procedures prescribed in
this section are followed, representatives of the port director will from
time to time verify various withdrawals against all pertinent records,
including financial records, of the
withdrawers, deliverers, and receivers
of the oil. The withdrawer shall maintain all pertinent records relating to
the withdrawal, delivery, or receipt of
the fuel oil for 5 years from the date of
liquidation of the related fuel oil
entry.
[T.D. 69–99, 34 FR 6520, Apr. 16, 1969, as
amended by T.D. 79–159, 44 FR 31967, June 4,
1979; T.D. 82–204, 47 FR 49367, Nov. 1, 1982;
T.D. 95–81, 60 FR 52295, Oct. 6, 1995; T.D. 96–
18, 61 FR 6777, Feb. 22, 1996; T.D. 96–51, 61 FR
31395, June 20, 1996; T.D. 99–33, 64 FR 16347,
Apr. 5, 1999]

§ 10.62a Blanket withdrawals for certain merchandise.
(a) Generally. Under this section, a
blanket withdrawal on Customs Form
7501 may be filed for all or part of any
merchandise withdrawn from warehouse except fuel oil covered under
§ 10.62, for use on qualified vessels.
Such a withdrawal shall be made only
for lading on board vessels at the port
where the warehouse is located. The
procedure for the blanket withdrawal
and partial releases after the initial release are the same as those provided in
§ 19.6(d) of this chapter, except as noted
in paragraph (b).
(b) Partial release. A partial release on
Customs Form 7501, in duplicate, or in
triplicate if an extra copy is required
by the port director, shall be presented
to the warehouse proprietor and placed
in the proprietor’s permit file folder
under the partial release procedure set
forth in § 19.6(d) of this chapter, as merchandise is needed for delivery to a
using vessel. The original of the partial
release document shall accompany the
merchandise for delivery to the Customs officer who will supervise lading,
or if a Customs officer does not physically supervise lading, to the master
of the vessel. The original shall be returned to the proprietor for record purposes after the Customs officer or master of the vessel, as appropriate, has

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§ 10.62b

19 CFR Ch. I (4–1–11 Edition)

certified lading of the goods described
in the document.
[T.D. 82–204, 47 FR 49367, Nov. 1, 1982, as
amended by T.D. 95–81, 60 FR 52295, Oct. 6,
1995]

§ 10.62b

Aircraft turbine fuel.

(a) General. Unless otherwise provided, aircraft turbine fuel withdrawn
from a Customs bonded warehouse for
use under section 309, Tariff Act of
1930, as amended (19 U.S.C. 1309), may
be commingled with domestic or other
aircraft turbine fuel after such withdrawal only if such commingling is approved by the appropriate Customs official for the port where the commingling occurs. The appropriate Customs
official may approve such commingling
if the fueling system in which the commingling will occur contains adequate
physical safeguards to prevent the possible unauthorized entry into the Customs territory of the bonded fuel. Such
commingled fuel must be accounted for
in the same 24-hour period in which it
was commingled and must be—
(1) Exported within that 24-hour period;
(2) Used under section 309 within that
24-hour period; or
(3) Entered or withdrawn for consumption, with duty deposited, as required under the applicable regulations
(see part 144 of this chapter).
(b) Duty-free withdrawal from warehouse of aircraft turbine fuel under section 557(a), Tariff Act of 1930, as amended
(19 U.S.C. 1557(a)). Turbine fuel intended for use as supplies on aircraft
under section 309, Tariff Act of 1930, as
amended, and withdrawn from a Customs bonded warehouse shall be entitled to the privileges provided for in
section 309 if an amount equal to or exceeding the quantity of such fuel is established, as provided for in paragraph
(c) of this section, to have been used on
aircraft qualifying for the privileges
provided for in section 309 within 30
days after the withdrawal of the fuel
from the Customs bonded warehouse.
Withdrawal of aircraft turbine fuel
under this paragraph shall be in accordance with the procedures in §§ 10.59
through 10.64, unless otherwise provided in this section. Withdrawals
under this paragraph shall be anno-

tated with the term ‘‘Withdrawal under
19 CFR 10.62b(b)’’.
(c) Establishment of use of fuel by
qualifying aircraft. (1) The person withdrawing aircraft turbine fuel under
paragraph (b) of this section must establish that an aircraft qualifying for
the privileges provided for in section
309, Tariff Act of 1930, as amended, used
fuel in an amount equal to or exceeding
the quantity of the fuel withdrawn that
is not entered and upon which duties
are not paid by submitting to Customs,
at the port where the bonded warehouse entry was filed, within the time
provided in paragraph (d) of this section, either—
(i) Records prepared in the normal
course of business effecting the transfer to identified (e.g., by aircraft company name, flight number, flight origin
and destination, and date of flight) aircraft of fuel in an amount equal to or
exceeding the quantity of the fuel
withdrawn which is not entered and on
which duties are not paid and objective
evidence that the aircraft to which the
fuel was transferred were actually used
in trade qualifying for the privileges
provided in section 309, Tariff Act of
1930, as amended; or
(ii) A certification (documentary or
electronic) that:
(A) All of the fuel withdrawn was intended for use on aircraft entitled to
the privileges provided for in section
309;
(B) Within 30 days of the date of
withdrawal
from
warehouse,
an
amount of fuel equal to or exceeding
the quantity of the fuel withdrawn
which is not entered and on which duties are not paid was transferred as
supplies to aircraft entitled to the
privileges provided for in section 309;
(C) All of the aircraft into which fuel
is loaded hereunder were used in a
trade provided for in section 309; and
(D) The person making the certification possesses evidence (documentary or electronic) available for Customs inspection at a named place
which supports each of the above statements.
(2) Upon request by Customs, the person who submits the certification provided for in paragraph (c)(1) of this section shall promptly provide the evidence required to support the claim for

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U.S. Customs and Border Protection, DHS; Treasury
treatment under this section (including
the records described in § 10.62b(c)(1)(i))
and §§ 10.62 and 19.6(d) and each of the
statements in the certification.
(d) Time for establishment of use of fuel
by qualifying aircraft. The person withdrawing aircraft turbine fuel under
paragraph (b) of this section shall submit the records or certification provided for in paragraph (c) of this section by the 40th day after the date of
withdrawal of the fuel unless the fuel
was withdrawn under a blanket withdrawal under paragraph (g) of this section. If the fuel was withdrawn under a
blanket withdrawal, the person withdrawing aircraft turbine fuel under this
section shall submit the records or certification provided for in paragraph (c)
of this section by the 40th day after all
of the fuel covered by the blanket permit to withdraw has been withdrawn.
(e) Treatment of turbine fuel withdrawn
but not used on qualifying aircraft within
30 days. If turbine fuel is withdrawn
from a Customs bonded warehouse
under paragraph (b) of this section but
fuel in an amount less than the quantity withdrawn is established to have
been used within 30 days of the date of
withdrawal from warehouse on aircraft
qualifying for the privileges provided
for in section 309, Tariff Act of 1930, as
amended, a withdrawal for consumption shall be filed and duties shall be
deposited for the excess of fuel so withdrawn over that used on aircraft so
qualifying. Such withdrawal shall be
filed and such duties shall be deposited
by the 40th day after the date of withdrawal of the fuel in accordance with
the procedures in § 144.38 of this chapter. Interest shall be payable and deposited with such duties, calculated
from the date of withdrawal at the rate
of interest established under 26 U.S.C.
6621.
(f) Liquidated damages. Failure to account for turbine fuel withdrawn under
paragraphs (b) through (h) of this section shall result in liquidated damages
against the person withdrawing the
turbine fuel, as provided for under
§ 113.62 of this chapter. Such failure to
account for turbine fuel includes:
(1) The failure to timely file the
withdrawal for consumption and payment of duty, with interest, on the
quantity of fuel so withdrawn in excess

§ 10.62b

of the quantity of fuel established to
have been used on qualifying aircraft
within 30 days of withdrawal, as provided for in paragraph (e) of this section;
(2) The failure to timely file the evidence or certification establishing such
use of the fuel which is not entered and
on which duties are not paid, as provided for in paragraph (c) of this section; or
(3) The failure to promptly provide
the evidence required to support the
claim for treatment under paragraph
(b) of this section, upon request by Customs, as provided for in paragraph
(c)(2) of this section.
(g) Blanket withdrawals. Blanket
withdrawals, as provided for in §§ 10.62
and 19.6(d), may be used for withdrawals from warehouse under section
557(a), Tariff Act of 1930, as amended,
and paragraphs (b) through (h) of this
section, under the procedures provided
in §§ 10.62 and 19.6(d) except that—
(1) Application by the withdrawer for
a blanket permit to withdraw shall be
on the warehouse entry, or on the
warehouse entry/entry summary when
used as an entry, annotated with the
words ‘‘Some or all of the merchandise
will be withdrawn under blanket permit per §§ 10.62, 10.62b, and 19.6(d).’’;
(2) Turbine fuel withdrawn under a
blanket permit as authorized in this
paragraph may be delivered at a port
other than the port of withdrawal;
(3) Customs acceptance of a properly
completed application for a blanket
permit to withdraw, on the warehouse
entry or warehouse entry/entry summary, will constitute approval of the
blanket permit to withdraw;
(4) A copy of the approved blanket
permit to withdraw will be delivered to
the warehouse proprietor, whereupon
fuel may be withdrawn under the terms
of the blanket permit;
(5) The withdrawal document to be
placed in the proprietor’s permit file
folder (see § 19.6(d)(2)) will be a commercially acceptable document of receipt (such as a ‘‘withdrawal ticket’’)
issued by the warehouse proprietor,
identified with a unique alpha-numeric
code and containing the following information:
(i) Identity of withdrawer;

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§ 10.63

19 CFR Ch. I (4–1–11 Edition)

(ii) Identity of warehouse and tank
from which fuel is withdrawn;
(iii) Date of withdrawal;
(iv) Type of merchandise withdrawn;
and
(v) Quantity of merchandise withdrawn.
(6) The date of withdrawal, for purposes of calculating the 30-day period
in which fuel must be used on qualifying aircraft under this section, shall
be the date on which physical removal
of the fuel from the warehouse commences;
(7) The blanket permit summary prepared by the proprietor as provided for
in § 19.6(d)(4) shall be prepared when all
of the fuel covered by the blanket permit has been withdrawn and shall account for all merchandise withdrawn
under the blanket permit, as required
by § 19.6(d)(4), by stating, in summary
form, the unique alpha-numeric codes
and information required in paragraph
(g)(5) of this section, as well as the
identity of the warehouse entry to
which the withdrawal is attributed;
(8) The certification on the blanket
permit summary (see § 19.6(d)(4)) shall
be that the merchandise listed thereunder was withdrawn in compliance
with §§ 10.62, 10.62b, and 19.6(d); and
(9) The person withdrawing aircraft
turbine fuel under these blanket procedures shall submit the records or certification provided for in § 10.62b(c) by
the 40th day after all of the fuel covered by the blanket permit has been
withdrawn (see § 10.62b(d)). At the discretion of the port director for the port
where blanket withdrawal was approved, submission of the records and
evidence required to establish use of
the fuel on qualifying aircraft may be
required to be submitted electronically, in a format compatible with Customs electronic record-keeping systems.
(h) Recordkeeping. The person withdrawing aircraft turbine fuel from
warehouse under this section is subject
to the recordkeeping requirements in
19 U.S.C. 1508 and 1509, as provided for
in part 162 of this chapter.
[T.D. 96–18, 61 FR 6778, Feb. 22, 1996, as
amended by T.D. 99–33, 64 FR 16347, Apr. 5,
1999]

§ 10.63 Landing of supplies and stores
from receiving vessel in the United
States.
Supplies or stores laden on a vessel
duty and tax free under section 309,
Tariff Act of 1930, as amended, may be
landed under Customs supervision
under proper permit, the same as if
they had been laden in a foreign country. See § 4.39 of this chapter. Except
when transfer to another vessel entitled to the free withdrawal privilege is
permitted under the original withdrawal under section 309, Tariff Act of
1930, as amended, the landed articles
shall be treated as an importation from
a foreign country.
[28 FR 14663, Dec. 31, 12963, as amended by
T.D. 89–1, 53 FR 51250, Dec. 21, 1988; T.D. 97–
82, 62 FR 51769, Oct. 3, 1997]

§ 10.64 Crediting or cancellation of
bonds.
(a) Except as stated below, a bond on
Customs Form 301, containing the bond
conditions set forth in § 113.62 of this
chapter may be credited or canceled in
respect of such articles upon the vessel’s departure from the port of lading
in a class of trade or business entitling
the articles to exemption from duty
and tax under the statute. The withdrawer shall cause the merchandise to
be delivered to the lading vessel, and
shall provide such evidence of lading as
required by the port director within 30
days after lading, except as provided in
this section. If the vessel is not operated by the United States and proceeds
in ballast from the port where the articles are laden to another port to lade
passengers or cargo for carriage in a
class of trade specified in section 309,
Tariff Act of 1930, as amended, the bond
may be credited or canceled upon the
filing with the director of the port of
withdrawal within 3 months after the
date of withdrawal of a proper declaration as prescribed below. The declaration shall be executed by one of the following who has knowledge of the facts:
(1) The operations manager or port
captain for the vessel on which the articles are laden but not a representative of the supplier.
(2) The master or other officer of the
vessel on which the articles are laden.
The declaration shall be in substantially the following form:

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U.S. Customs and Border Protection, DHS; Treasury
I,
—————————————————————
(Operations manager, port captain, master,
or other officer) of the vessel llllll declare that I have knowledge of the facts set
forth herein, and that upon the lading of the
articles described below covered by withdrawal
No.
llll,
filed
at
llllllll(Name of port), the vessel
then
proceeded
in
ballast
to
llllllll(Name of port) to lade cargo
or passengers; that the vessel was suitable
for service in the class of trade checked
below with fittings, outfit, and equipment
for such trade already installed when it so
departed in ballast; and that upon arrival it
proceeded to engage in the carriage of cargo
or passengers in such trade, except as stated
below:
llllllllllllllllllllllll
(If no exception, note ‘‘None’’)
1. Foreign Trade.
2. Trade between Atlantic and Pacific ports
of the United States, when such trade is
not prohibited by coastwise laws.
3. Trade between the United States and any
of its possessions, when such trade is not
prohibited by coastwise laws.
4. Trade between Alaska or Hawaii and any
other part of the United States, when
such trade is not prohibited by coastwise
laws.
Description of articles:
llllllllllllllllllllllll
llllllllllllllllllllllll
llllllllllllllllllllllll
llllllllllllllllllllllll
————————————
(Name and title)

(b) A declaration as to the intended
business or trade of a vessel may, in
the discretion of the port director, be
accepted in lieu of a declaration prescribed in paragraph (a) of this section
when the amount of duty or tax, or
both, involved in a single lading is less
than $100.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 84–213, 49 FR 41166, Oct. 19, 1984]

§ 10.64a

[Reserved]

§ 10.65 Cigars and cigarettes.
(a) Imported cigars and cigarettes in
bonded warehouse or otherwise in Customs custody, and such articles manufactured with the use of imported materials in a bonded manufacturing
warehouse of class 6, may be withdrawn under section 317, Tariff Act of
1930, as amended, for consumption beginning beyond the 3-mile limit or
international boundary, as the case

§ 10.65

may be, (1) on vessels actually engaged
in the foreign, intercoastal, or noncontiguous territory trade within the
purview of § 10.59(a); (2) on vessels departing from the port where the withdrawal is made directly for a foreign
port, a port on the opposite coast, or a
port in one of the possessions of the
United States; or (3) on vessels of war
or other governmental activity.
(b) The privilege shall not be granted
to vessels stationed in American waters for an indefinite period without
sailing schedules, nor shall it be granted to aircraft of foreign registry of a
country for which there is not in effect
a finding and advice by the Department
of Commerce under section 309(d), Tariff Act of 1930, as amended, that such
country allows privileges to aircraft
registered in the United States substantially reciprocal to those described
in section 317, Tariff Act of 1930, as
amended. See section 10.59(f).
(c) With the following additions and
exceptions, the same procedure shall be
followed as in the case of withdrawals
under section 309(a), Tariff Act of 1930,
as amended.
(1) No bond shall be required in the
case of vessels operated by the United
States Government.
(2) When a shipping case containing
cigars and cigarettes is made up of a
number of units, each in a separate
package, such units may be withdrawn
separately, provided each unit is
marked and numbered for identification and contains not less than 250 cigars or 1,000 cigarettes. In the case of
imported cigars and cigarettes so
packed, only one unit from each shipping case shall be opened for examination, unless the port director shall
deem it necessary for the protection of
the revenue to examine a greater quantity. Imported tobacco products on
which the duty or internal-revenue tax
has been paid may not be withdrawn
under section 317, Tariff Act of 1930, as
amended, with a drawback of such duty
or internal-revenue tax.
(3) When all the units in such shipping case are not to be withdrawn at
the same time or for use on the same
vessel, a blanket withdrawal may be
filed for the entire case in lieu of a separate withdrawal for each unit. In such
event, the withdrawal shall be retained

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§ 10.66

19 CFR Ch. I (4–1–11 Edition)

by the warehouse proprietor until delivery receipts are obtained for the entire quantity covered by the withdrawal, provided the total period of
time prior to delivery to the using vessel or aircraft does not exceed 5 years.
A bond on Customs Form 301, containing the bond conditions set forth in
§ 113.62 of this chapter, when required,
shall be filed at the time of or prior to
the removal of any of the merchandise
from the warehouse for delivery to the
vessel on which it is to be used.
(4) Merchandise for which blanket
withdrawals are filed shall be stored in
a separate room or enclosure in a bonded warehouse under separate locks, and
the merchandise clearly marked to
show that it has been withdrawn. If, at
the time of any such inventory, any
merchandise is missing and not properly accounted for, duties shall be paid
thereon before any further withdrawals
are permitted.
(5) The declaration of use, when required, shall include a statement that
consumption of the articles covered by
the withdrawal did not begin until the
withdrawing vessel or aircraft had proceeded beyond the 3 mile limit or the
international boundary.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 67–193, 32 FR 11764, Aug. 16, 1967; T.D. 70–
73, 35 FR 5400, Apr. 1, 1970; T.D. 82–204, 47 FR
49368, Nov. 1, 1982; T.D. 84–213, 49 FR 41166,
Oct. 19, 1984; T.D. 89–1, 53 FR 51250, Dec. 21,
1988]

ARTICLES EXPORTED FOR EXHIBITION,
ETC.
§ 10.66 Articles exported for temporary
exhibition and returned; horses exported for horse racing and returned; procedure on entry.
(a) In connection with the entry of
articles, including livestock or other
animals, exported for temporary exhibition and returned and claimed to be
exempt from duty under subheading
9801.00.50 or 9801.00.60, Harmonized Tariff Schedule of the United States
(HTSUS), there shall be filed:
(1) A certificate of exportation on
Customs Form 3311;
(2) A declaration of the importer on
Customs Form 4455 for articles of either domestic or foreign origin; and
(3) In the case of animals of foreign
origin taken abroad for exhibition in

connection with a circus or menagerie,
a copy of an inventory of these animals
filed prior to their leaving the country
with the director of the port of their
departure.
(b) If it is shown to be impracticable
to produce the certificate of exportation required under paragraph (a)(1)
of this section, the port director may
accept other satisfactory evidence of
exportation, or may take a bond on
Customs Form 301, containing the bond
conditions set forth in § 113.62 of this
chapter to secure the production of
such certificate or other evidence.
(c) Articles claimed to be exempt
from duty under subheading 9801.00.50
or 9801.00.60, Harmonized Tariff Schedule of the United States (HTSUS) (19
U.S.C. 1202), may be returned free of
duty without formal entry and without
regard to the requirements of paragraph (a) or (b) of this section if:
(1) Prior to the exportation of such
articles, an application on Customs
Form 4455 (accompanied by an appropriate inventory, when required by law
or by the port director) is filed with a
declaration thereon that:
(i) Any right to drawback of Customs
duties with respect to that shipment
was waived;
(ii) Any internal revenue tax due has
been paid and no refund thereof will be
sought; and
(iii) The merchandise was identified,
registered, and exported in accordance
with the regulations set forth in
§§ 10.8(e), (g), (h), and (i), governing the
exportation of articles sent abroad for
repairs, and
(2) Upon return, a duplicate Customs
Form 4455 (with accompanying inventory where one was required) is filed.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 74–242, 39 FR 33794, Sept. 20, 1974; T.D.
75–235, 40 FR 44319, Sept. 26, 1975; T.D. 78–153,
43 FR 23709, June 1, 1978; T.D. 82–224, 47 FR
53727, Nov. 29, 1982; T.D. 84–213, 49 FR 41166,
Oct. 19, 1984; T.D. 87–75, 52 FR 20066, May 29,
1987; T.D. 89–1, 53 FR 51250, Dec. 21, 1988; T.D.
94–1, 58 FR 69470, Dec. 30, 1993]

§ 10.67 Articles exported for scientific
or educational purposes and returned; procedure on entry.
(a) In connection with each entry of
articles exported for scientific or educational purposes and returned under

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U.S. Customs and Border Protection, DHS; Treasury
subheading 9801.00.40, Harmonized Tariff Schedule of the United States
(HTSUS), the following shall be required, irrespective of the value of the
shipment:
(1) A certificate of exportation on
Customs Form 3311;
(2) A declaration by the foreign shipper in the same form as that prescribed
in § 10.66(a)(2) but stating that such articles were sent from the United States
solely for temporary scientific or educational use and describing the specific
use to which they were put while
abroad.
(3) A declaration of the ultimate consignee in substantially the following
form:
Port of llllllll, Port Director’s Office, lllllllll, 19ll.
I, llllllllll, declare that the several articles described in the annexed entry
are, to the best of my knowledge and belief,
the identical articles exported from the
United States on the llllll day of
llllll, 19ll, by lllllllll (Actual shipper) address llllllll, for the
account
of
llllllll,
address
llllllllthat they are returned to
llllllll, address llllllll, for
the account of llllllll, address
lllllll that the said articles were exported solely for temporary scientific or educational purposes and for no other use
abroad than for exhibition, examination, or
experimentation; that they are being returned without having been changed in condition in any manner, except by reason of
their bona fide use as follows:
llllllllllllllllllllllll
(Describe change in condition)
llllllllllllllllllllllll
————————————
(Ultimate consignee)

(b) If it is shown to be impracticable
to produce the certificate of exportation required by paragraph (a)(1) of
this section, the port director may accept other satisfactory evidence of exportation. The port director may take
a bond on Customs Form 301, containing the bond conditions set forth in
§ 113.62 of this chapter to secure the
subsequent production of any of the
evidence or documents required by
paragraph (a) of this section which are
not available at the time of entry.
(c) If, prior to the exportation of articles claimed to be exempt from duty
under
subheading
9801.00.40,
Harmonized Tariff Schedule of the United

§ 10.68

States (HTSUS), an application on Customs Form 4455 (accompanied by an appropriate inventory when, in the discretion of the port director, such inventory is deemed necessary) was filed,
such articles may be returned for the
account of the exporter free of duty
without formal entry, without regard
to the requirements of paragraphs (a)
and (b) of this section, upon the filing
of the duplicate Customs Form 4455
(with accompanying inventory, if one
was required), and a declaration of the
ultimate consignee in substantially the
form set forth in paragraph (a)(3) of
this section.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 74–242, 39 FR 33794, Sept. 20, 1974; T.D.
84–213, 49 FR 41166, Oct. 19, 1984; T.D. 89–1, 53
FR 51250, Dec. 21, 1988; T.D. 94–1, 58 FR 69470,
Dec. 30, 1993; T.D. 97–82, 62 FR 51769, Oct. 3,
1997]

THEATRICAL EFFECTS, MOTION-PICTURE
FILMS, COMMERCIAL TRAVELERS’ SAMPLES, AND TOOLS OF TRADE
§ 10.68

Procedure.

(a) Theatrical scenery, properties,
and effects, motion-picture films (including motion-picture films taken
aboard a vessel for exhibition only during an outward voyage and returned for
the same purpose during an inward
voyage on the same or another vessel),
commercial travelers’ samples, and
professional books, implements, instruments, and tools of trade, occupation,
or employment (see § 148.53 of this
chapter), of domestic or foreign origin,
taken abroad may be returned without
formal entry and without payment of
duty if an exportation voucher from a
carnet, when applicable, or an application on Customs Form 4455 was filed,
and the merchandise was identified as
set forth in § 10.8, before exportation of
the articles. Articles exported under
cover of an A.T.A. carnet (where the
carnet serves as the control document)
may, in accordance with this paragraph, be returned without entry or the
payment of duty. If Customs Form 4455
is utilized, commercial travelers’ samples, professional books, implements,
instruments, and tools of trade, occupation, or employment may be returned with either an informal entry or
a declaration on Customs Form 3299;

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§ 10.69

19 CFR Ch. I (4–1–11 Edition)

theatrical scenery, properties, and effects and motion-picture films may be
returned only with an informal entry.
When articles other than those exported by mail or parcel post are examined and registered at one port and exported through another port, the port
director may require proof of exportation in those cases where the carnet
or Customs Form 4455 does not reflect
that these articles were exported under
Customs supervision. In the case of
commercial travelers’ samples taken
abroad for temporary use, except where
exportation involves certification of a
carnet, port directors may waive examination of the samples at the time of
exportation.
When
motion-picture
films are to be taken aboard a vessel
for exhibition only during an outward
voyage and are to be returned for the
same purpose during an inward voyage
on the same or another vessel, port directors may waive examination and supervision at the time of exportation.
When theatrical scenery, properties,
and effects are taken abroad in sealed
carload lots by rail for temporary use,
the cars must be sealed by U.S. Customs officers for entry at any Canadian
or Mexican port where U.S. Customs
officers are stationed. Application and
examination before the time of exportation is waived if a Customs Form 4455
is filed with the U.S. Customs officer in
the appropriate Canadian or Mexican
port, and that officer examines the articles before they are released from foreign customs custody by the foreign
customs officer.
(b) When any such articles are to be
returned to the United States from a
contiguous foreign country in which a
United States Customs officer is stationed, the articles may be presented
to such officer with the duplicate copy
of the application for examination and
comparison with the descriptive list.
Upon completion of such examination,
the packages containing the articles
shall be corded and sealed or forwarded
in cars sealed by Customs officers and
shall be manifested in the same manner as personal baggage. Articles so
treated shall be released upon arrival
in the United States and removal of
the seals by Customs officers.
(c) When commercial travelers’ samples consisting of raw cotton are taken

to and returned from Canada, the application on Customs Form 4455 shall
be executed in triplicate, two copies
thereof to be returned to the traveler
for surrender to the Customs officer on
the return of the samples from Canada.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 69–146, 34 FR 9801, June 25, 1969; T.D. 75–
41, 40 FR 6646, Feb. 13, 1975; T.D. 82–49, 47 FR
12160, Mar. 22, 1980; T.D. 82–116, 47 FR 27261,
June 24, 1982]

§ 10.69 Samples to Great Britain and
Ireland under reciprocal agreement.
Descriptive lists of samples taken to
Great Britain and Ireland by commercial travelers of the United States
under the joint declarations of December 3 and 8, 1910 (State Department
treaty series 552), shall be required in
triplicate, verified by the affidavit of
the commercial traveler before a Customs officer, and shall show that the
samples are for use as models or patterns for the purpose of obtaining orders and not for sale and that the lists
contain a full description of the articles. One copy shall be retained and the
others shall be delivered to the commercial traveler—one for the identification of the samples on their return
to the United States and one for the
use of the foreign customs authorities.
The latter copy must have been attested by a consular officer of the
country concerned in the United
States.
ANIMALS AND BIRDS
CROSS REFERENCE: For regulations with respect to recognition of breeds and purebred
animals, see 9 CFR part 151.

§ 10.70 Purebred animals for breeding
purposes; certificate.
(a) In connection with the entry of
purebred animals for breeding purposes
under
subheading
0101.11.00,
Harmonized Tariff Schedule of the United
States (HTSUS), no claim for free
entry shall be allowed in liquidation of
the entry until the port director has
received from the Department of Agriculture a certificate that the animal is
purebred of a recognized breed and duly
registered in a book of record recognized by the Secretary of Agriculture
for that breed. Importers are required

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U.S. Customs and Border Protection, DHS; Treasury
by regulation of the Department of Agriculture to make application for a certificate of pure breeding to the U.S. Department of Agriculture, Animal and
Plant Health Inspection Service, Veterinary Services, on ANH Form 17–338
before the animal will be examined as
required by 9 CFR 151.7. Application for
the certificate must be executed by the
owner agent, or importer and filed at a
port of entry designated in the regulations of the Department of Agriculture
for the importation of animals (9 CFR
92.3). However, applications for certificates for dogs (other than dogs for handling livestock regulated under 9 CFR
92.18) and cats may be filed either at a
designated port of entry or at any
other port where Customs entry is
made. The regulations of the Department of Agriculture prescribing the requirements for the issuance of certificates of pure breeding provide that all
animals imported under such regulations must be accompanied to the port
at which examination is to be made by
certificates of pedigree and transfer of
ownership in order that identification
may be accomplished, and that, if such
animals are moved from such port
prior to the presentation of such certificates and transfers, such action
shall constitute a waiver of any further
claim to certification under such regulations.
(b) In the cases of cats and dogs arriving at Canadian border ports, Customs officers and employees are hereby
authorized and directed to make the
examination required by such regulations of the Department of Agriculture.
Customs officers and employees are
also authorized and directed to make
such examinations at the ports of New
York and Boston, provided the dog or
cat is brought into the United States
by a passenger. At all airports, Customs officers shall make the examination of dogs and cats, whether or not
accompanied by the owners, if there is
no inspector of the Department of Agriculture stationed there or on duty at
the time of arrival.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 68–154, 33 FR 8730, June 14, 1968; T.D. 78–
99, 43 FR 13060, Mar. 29, 1978; T.D. 87–75, 52 FR
20066, May 29, 1987; T.D. 89–1, 53 FR 51250,
Dec. 21, 1988]

§ 10.71

§ 10.71 Purebred animals; bond for
production of evidence; deposit of
estimated duties; stipulation.
(a) The animal may be released from
Customs custody upon the furnishing
by the importer of a bond on Customs
Form 301, containing the bond conditions set forth in § 113.62 of this chapter
for the production within 6 months of
(1) a certificate of pure breeding issued
by the Department of Agriculture, and
(2) the declaration required by § 10.70(a)
submitted in letter form if such declaration was not filed at the time of
entry. The release of the animal from
customs custody requires the presentation of the pedigree certificate and
evidence of transfer of ownership in accordance with the regulations of the
Department of Agriculture mentioned
in § 10.70(b).
(b) Charges against the bond shall be
canceled only upon the production of
the required evidence or on payment of
duties.
(c) In cases where the pedigree certificate and evidence of transfer of
ownership have been presented in accordance with the regulations of the
Department of Agriculture, the importer, if he so elects, may, in lieu of
giving a bond, deposit estimated duties
and file a stipulation with the port director within 10 days after the date of
entry to produce the declaration and
certificate of pure breeding within 6
months from the date of entry, whereupon the liquidation of the entry shall
be suspended. (See § 113.42 of this chapter.)
(d) If the pedigree certificate and evidence of transfer of ownership were not
presented in accordance with such regulations of the Department of Agriculture, a deposit of estimated duties,
in addition to the regular entry bond,
shall be required.
(e) When a passenger arriving in the
United States with one or more dogs or
cats and with the required certificates
of pedigree and transfers of ownership
in his possession furnishes a properly
executed declaration as required by
§ 10.70(a) along with an application to
the Department of Agriculture on ANH
Form 17–338 for a certificate of pure
breeding, the entry of the animal(s) as
duty-free under subheading 0106.00.50,
Harmonized Tariff Schedule of the

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§§ 10.72–10.73

19 CFR Ch. I (4–1–11 Edition)

United States (HTSUS), may be made
on the passenger’s baggage declaration
if the value of the animals does not exceed $500. In such case the entry shall
be supported by a bond on Customs
Form 301, containing the bond conditions set forth in § 113.62 of this chapter
for the production within 6 months of a
certificate of pure breeding. The bond
shall be without surety or cash deposit
unless the port director on the basis of
information before him finds that a
bond with surety or a cash deposit is
necessary to protect the revenue.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 68–79, 33 FR 4461, Mar. 13, 1968; T.D. 68–
154, 33 FR 8731, June 14, 1968; T.D. 74–227, 39
FR 32015, Sept. 4, 1974; T.D. 78–99 43 FR 13060,
Mar. 29, 1978; T.D. 84–213, 49 FR 41166, Oct. 19,
1984; T.D. 87–75, 52 FR 26142, July 13, 1987;
T.D. 89–1, 53 FR 51250, Dec. 21, 1988; T.D. 93–
66, 58 FR 44130, Aug. 19, 1993]

§§ 10.72–10.73

[Reserved]

§ 10.74 Animals straying across boundary for pasturage; offspring.
When domestic animals for which
free entry is to be claimed under subheading 9801.00.90, Harmonized Tariff
Schedule of the United States, have
strayed across the boundary line, they
may be returned, together with their
offspring, without entry if brought
back within 30 days; otherwise entry
shall be required. The owner of any
such animal shall report its return to
the nearest Customs office and hold it
for such inspection and treatment as
may be deemed necessary by a representative of the Animal and Plant
Health Inspection Service of the Department of Agriculture. Any such arrival found not to have been so reported or held shall be subject to seizure and forfeiture pursuant to 18
U.S.C. 545.
[T.D. 87–75, 52 FR 20067, May 29, 1987, as
amended by T.D. 89–1, 53 FR 51250, Dec. 21,
1988]

§ 10.75 Wild animals and birds; zoological collections.
When wild animals or birds are
claimed to be free of duty under subheading 9810.00.70, Harmonized Tariff
Schedule
of
the
United
States
(HTSUS), (19 U.S.C. 1202), the port director may, at his discretion, require
appropriate proof that the animals or

birds were specially imported pursuant
to negotiations conducted prior to importation for the delivery of animals or
birds of a named species meeting
agreed specifications of reasonable particularity and that they are intended
at the time of importation for public
exhibition in a collection maintained
for scientific or educational purposes
and not for sale or for use in connection with any enterprise conducted for
profit. The fact that an animal or bird
may have been sent on approval shall
not preclude free entry under subheading 9810.00.70, HTSUS, when it is
actually accepted as a part of the zoological collection and so exhibited.
[T.D. 85–123, 50 FR 29953, July 23, 1985, as
amended by T.D. 89–1, 53 FR 51250, Dec. 21,
1988; T.D. 97–82, 62 FR 51769, Oct. 3, 1997]

§ 10.76 Game animals and birds.
(a) The following classes of live game
animals and birds may be admitted free
of duty for stocking purposes under the
provisions of subheading 9817.00.70
without reference to the United States
Customs Service, if the requirements
of the Fish and Wildlife Service, Department of the Interior, have been
complied with.
ANIMALS

1. Cervidae, commonly known as deer and
elk.
2. Leporidae, commonly known as rabbits.
3. Sciuridae, commonly known as squirrels.
BIRDS

1. Anatidae, commonly known as ducks
and geese.
2. Gallinae, commonly known as turkeys,
grouse, pheasants, partridges, and quail.
3. Otididae, commonly known as bustards.
4.
Tinamidae,
commonly
known
as
tinamous.

(b) Application for the free entry of
other live animals or birds under subheading 9817.00.70, Harmonized Tariff
Schedule of the United States shall be
referred to the United States Customs
Service for consideration. Animals imported for fur-farming purposes shall
not be admitted free of duty under that
paragraph.
(c) [Reserved]
(d) Game animals and birds killed in
foreign countries by residents of the
United States, if not imported for sale
or other commercial purposes, may be

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U.S. Customs and Border Protection, DHS; Treasury
admitted free of duty without entry, if
the person has no merchandise requiring a written declaration upon the filing of a declaration on U.S. Fish and
Wildlife Service Form 3–177, Declaration for Importation or Exportation of
Fish or Wildlife. No bond or cash deposit to insure the destruction or exportation of the plumage of such birds
shall be required.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 82–145, 47 FR 35475, Aug. 16, 1982; T.D. 86–
118, 51 FR 22515, June 20, 1986; T.D. 89–1, 53
FR 51250, Dec. 21, 1988; T.D. 90–78, 55 FR 40166,
Oct. 2, 1990]

§ 10.77

[Reserved]

PRODUCTS OF AMERICAN FISHERIES
§ 10.78 Entry.
(a) No entry shall be required for fish
or other marine products taken on the
high seas by vessels of the U.S. or by
residents of the U.S. in undocumented
vessels owned in the U.S. when such
fish or other products are brought into
port by the taking vessel or are transferred at sea to another fishing vessel
of the same fleet and brought into port.
(b) An American fishery, within the
meaning of Subchapter XV of Chapter
98, Harmonized Tariff Schedule of the
United States, is defined as a fishing
enterprise conducted under the American flag by vessels of the United
States on the high seas or in foreign
waters in which such vessels have the
right by treaty or otherwise, to take
fish or other marine products and may
include a shore station operated in conjunction with such vessels by the
owner or master thereof.
(c) The employment of citizens of a
foreign country by an American fishery
is permissible but the purchase by an
American fishery of fish or other marine products taken by citizens of a foreign country on the high seas or in foreign waters will subject such fish or
other marine products to treatment as
foreign merchandise.
(d) Products of an American fishery
shall be entitled to free entry although
prepared, preserved, or otherwise
changed in condition, provided the
work is done at sea by the master or
crew of the fishery or by persons employed by and under the supervision of
the master or owner of the fishery.

§ 10.80

Fish (except cod, haddock, hake, pollock, cusk, mackerel, and swordfish)
the product of an American fishery
landed in a foreign country and there
not further advanced than beheaded,
eviscerated, packed in ice, frozen and
with fins removed, shall be entitled to
free entry, whether or not such processing is done by the American fishery.
Products of an American fishery prepared or preserved on the treaty coasts
of Newfoundland, Magdalen Islands, or
Labrador, as such coasts are defined in
the Convention of 1818 between the
United States and Great Britain, shall
be entitled to free entry only if the
preparation or preservation is done by
an American fishery.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 87–75, 52 FR 20067, May 29, 1987; T.D. 89–
1, 53 FR 51250, Dec. 21, 1988]

§ 10.79

[Reserved]
SALT FOR CURING FISH

§ 10.80 Remission of duty; withdrawal;
bond.
Imported salt in bond may be used in
curing fish taken by vessels licensed to
engage in the fisheries, and in curing
fish in the shores of the navigable waters of the U.S., whether such fish are
taken by licensed or unlicensed vessels,
and upon proof that the sale has been
used for either of such purposes, the
duties on the same shall be remitted.
(Section 313(e), Tariff Act of 1930, 19
U.S.C. 1313(e)). Imported salt entered
for warehouse may be withdrawn under
bond for use in curing fish. Upon proof
that the salt has been so used, the duties thereon shall be remitted. In no
case shall the quantity of salt withdrawn exceed the reasonable requirements of the case. Withdrawal shall be
made on Customs Form 7501. Each
withdrawal shall contain the statement prescribed for withdrawals in
§ 144.32 of this chapter. When the withdrawal is made by a person other than
the importer of record, a bond on Customs Form 301, containing the bond
conditions set forth in § 113.62 of this
chapter for the production of proof of

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§ 10.81

19 CFR Ch. I (4–1–11 Edition)

proper use shall be filed. Upon acceptance of the bond, a withdrawal permit
shall be issued on Customs Form 7501.
[T.D. 89–1, 53 FR 51251, Dec. 21, 1988, as
amended by T.D 95–81, 60 FR 52295, Oct. 6,
1995]

§ 10.81 Use in any port.
(a) Salt withdrawn under bond for
use in curing fish on the shores of navigable waters may be used for such purpose at any port, but the evidence of
use in such cases shall be submitted
through the director of the port where
the salt was used.
(b) If desired, salt to be used in curing fish on shore at another port than
that in which it is warehoused in bond
may be withdrawn under a transportation entry and shipped in bond to the
other port at which it is to be used,
where it may be entered on Customs
Form 7501 which shall show withdrawal
of the salt for use in curing fish. Thereupon, and upon the filing of a bond on
Customs Form 301, containing the bond
conditions set forth in § 113.62 of this
chapter, such salt may be used without
being sent to a bonded warehouse or
public store. In such a case the proof of
use shall be filed at the latter port.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 84–213, 49 FR 41166, Oct. 19, 1984; T.D. 87–
75, 52 FR 20067, May 29, 1987; T.D 95–81, 60 FR
52295, Oct. 6, 1995]

§ 10.82

[Reserved]

§ 10.83 Bond; cancellation; extension.
(a) If it shall appear to the satisfaction of the port director holding the
bond referred to in § 10.80, that the entire quantity of salt covered by the
bond has been duly accounted for, either by having been used in curing fish
or by the payment of duty, the port director may cancel the charges against
the bond. The port director may require additional evidence in corroboration of the proof of use produced.
(b) On application of the person making the withdrawal, the period of the
bond may be extended 1 year so as to
allow the salt to be used during the
time of extension in curing fish with
the same privileges as if used during
the original period.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 87–75, 52 FR 20067, May 29, 1987]

AUTOMOTIVE PRODUCTS
§ 10.84 Automotive vehicles and articles for use as original equipment
in the manufacture of automotive
vehicles.
(a)(1) Certain motor vehicles and
motor vehicle equipment are eligible
for duty-free entry as proclaimed by
the President under the Automotive
Products Trade Act of 1965. The articles designated for such duty-free
treatment are defined in General Note
3(c)(iii), HTSUS (19 U.S.C. 1202). Specifically, such articles are those designated [as ‘‘Free (B)’’] in the ‘‘Special’’
subcolumn in Chapter 87, HTSUS, and
must qualify as ‘‘Canadian articles’’ as
defined in General Note 3(c)(iii)(A)(1),
HTSUS. To claim exemption from duty
under the Automotive Products Trade
Act of 1965, an importer must establish,
to the satisfaction of the appropriate
Customs officer, that the article in
question qualifies as a ‘‘Canadian article’’ for purposes of General Note
3(c)(iii)A)(1), HTSUS. The Customs officer may accept as satisfactory evidence a certificate executed by the exporter as set forth in paragraph (b) of
this section, subject to any verification
he may deem necessary. Alternatively,
the Customs officer may determine
that under the circumstances of the
importation a certificate is unnecessary.
(2) Under the United States-Canada
Free-Trade Agreement and implementing legislation (Pub. L. 100–449, 102
Stat. 1851) a manufacturer of motor vehicles may elect to average, over its 12month financial year, its calculation of
the value-content requirement for vehicles in establishing its eligibility for
tariff preference. Requirements for
averaging are set forth in § 10.310 and
10.311.
(b)(1) When all materials used at any
stage in the production of the imported
article are wholly obtained or produced
in Canada or the United States, or
both, a certificate in the following
form may be accepted as evidence that
the commodity is a ‘‘Canadian article’’:
All materials contained in the product covered by the lllll (Describe the invoice,
bill of lading, or other document or statement identifying the shipment) annexed or

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U.S. Customs and Border Protection, DHS; Treasury
appended to this certificate of Canadian origin at the time it was subscribed were wholly obtained or produced in Canada or the
United States, or both. No materials other
than those which were wholly obtained or
produced in Canada or the United States, or
both, were incorporated into this product or
any of its components at any stage of production or in the production of any intermediate product used at any stage in the
chain of production in Canada or the United
States, or both.

(2) When any material used at any
stage in the production of an imported
article or any of its components is not
wholly obtained or produced in Canada
or the United States, or both, a certificate in the following form may be accepted as evidence that the commodity
is nevertheless a ‘‘Canadian article’’:
The product covered by the lllll (Describe the invoice, bill of lading, or other
document or statement identifying the shipment) annexed or appended to this certificate of Canadian origin at the time it was
subscribed is an originating good so as to be
a Canadian article. There were used in its
production in Canada lllll (Description
sufficient for tariff classification of the materials, and number of units) of third country materials of which the price paid was
lllll per unit of quantity, plus
lllll which represents all costs incurred
in transporting the materials to the location
of the producer and the duties, taxes, and
brokerage fees on the materials, if such costs
were not included in the price paid.

(3) If such Customs officer is satisfied
that the revenue will be protected adequately thereby, he may accept in lieu
of the certificate specified in paragraph
(b)(2) of this section a certificate in the
following form when the merchandise
covered thereby has been produced
with third country material but is an
originating good under a specific rule
of origin for the merchandise:
The product covered by the lllll (Describe the invoice, bill of lading, or other
document or statement identifying the shipment) annexed or appended to this certificate of Canadian origin at the time it was
subscribed is an originating good so as to be
a Canadian article. There were or may have
been used in its production in Canada or the
United States, or both, materials of a third
country.
It is impractical to ascertain the exact
number of units of third country material, if
any, used in its production or the price paid
(and other costs required to be included in
the price paid) of such materials but to the

§ 10.84

best of (my) (our) (its) knowledge the materials are described (sufficient for tariff classification purposes) as follows: lllll.

(4) The certificates described in paragraphs (b)(2) and (b)(3) of this section
shall not be accepted if the statements
therein make it evident that the importation is not a ‘‘Canadian article’’
within the meaning of General Note
3(c), HTSUS.
(5) If more than one kind of article is
covered by a certificate provided for in
paragraph (b) (1), (2), or (3) of this section, the information required by the
certificate shall be shown with respect
to each kind. When more than one kind
of material, other than originating material, is used in the production of an
article covered by such a certificate,
the certificate shall state the number
of units, a description sufficient for
tariff classification purposes, the price
paid, and, if not included in the price
paid, the costs incurred in transporting
the materials to the location of the
producer and duties, taxes and brokerage fees paid in Canada and/or the
United States on the material, per unit
of each kind of materials.
(6) A certificate conforming to paragraph (b) (1), (2), or (3) of this section
shall be accepted as evidence of the
facts alleged therein only if:
(i) There is annexed thereto a copy of
the commercial invoice or bill of lading
covering the articles or other documentary evidence which identifies the article to which the certificate pertains,
(ii) The certificate is signed by the
manufacturer or producer of the article
to which it pertains, or by the person
who exported the articles from Canada,
and
(iii) It clearly appears that such copy
or other documentary evidence was annexed to the certificate when it was
signed.
(c) In lieu of the certification in
paragraph (b) (1), (2), or (3) of this section, a manufacturer of motor vehicles
who claims a preference under the
United
States-Canada
Free-Trade
Agreement and elects to average pursuant to § 10.310(a), shall be subject to the
requirements of §§ 10.301 to 10.311 of this
part.
(d) When an importer makes an
entry, or withdrawal from warehouse,
for consumption of articles for use as

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§ 10.90

19 CFR Ch. I (4–1–11 Edition)

‘‘original motor-vehicle equipment’’ as
that term is defined in General Note
3(c)(iii), HTSUS, he shall file in connection therewith his declaration that
the articles are being imported for use
as original equipment in the manufacture in the United States of the kinds
of motor vehicles specified in the General Note and furnish the name and address of the motor vehicle manufacturer. A copy of the written order, contract, or letter of intent shall be attached to the importer’s declaration
except that if the port director is satisfied that a copy of the written order,
contract, or letter of intent will be
made available by the importer or ultimate consignee for inspection by customs officials upon request during a period of 3 years from the date of such
entry or withdrawal from warehouse,
the production of such documents will
not be required. Proof of use need not
be furnished.
(e) If, after a Canadian article has
been accorded the status of original
motor-vehicle equipment, it is decided
to divert the article from its intended
use in the manufacture in the United
States of motor vehicles, the importer
or other person deciding to divert the
article from such intended use shall
give notice in writing of the decision to
the director of the port where entry
was made or where the offices of the
importer are located and either make
arrangements for its destruction or exportation under Customs supervision
or pay duties in accordance with General Note 3(c)(iii)(B)(2), HTSUS. If such
article is not destroyed or exported
under Customs supervision or the duties paid, the article, or its value, shall
be subject to forfeiture.
[T.D. 89–3, 53 FR 51765, Dec. 23, 1988, as
amended by T.D. 92–8, 57 FR 2453, Jan. 22,
1992; T.D. 93–66, 58 FR 44130, Aug. 19, 1993]

MASTER RECORDS, AND METAL
MATRICES
§ 10.90 Master records and metal matrices.
(a) Consumption entries covering importations under subheading 8524.99.20,
HTSUS, shall be filed at a port in the
Customs district in which the factory
where the articles will be used is located.

(b) The invoice filed with the entry
shall contain or be supported by a detailed statement of the cost of production, in the country where made, of
each master record or metal matrix
covered thereby.
(c) A bond on Customs Form 301, containing the bond conditions set forth in
§ 113.62 of this chapter shall be filed for
importations under this section.
(d) Entries already filed and future
entries shall be liquidated in due
course without the assessment of duty,
but liability on bonds given with the
entries shall be discontinued with respect to any article covered thereby
only upon payment of liquidated damages in an amount equal to the duties
which would have accrued had the master records or metal matrices been imported for use otherwise than in the
manufacture of sound records for export purposes, or upon satisfactory
proof that the master records or metal
matrices obtained therefrom have been
exported or destroyed under Customs
supervision, and that all sound records
made with the use of such articles have
been exported.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 84–213, 49 FR 41166, Oct. 19, 1984; T.D. 87–
75, 52 FR 20067, May 29, 1987; T.D. 89–1, 53 FR
51251, Dec. 21, 1988; T.D. 90–78, 55 FR 40166,
Oct. 2, 1990; T.D. 97–82, 62 FR 51769, Oct. 3,
1997]

PROTOTYPES
§ 10.91 Prototypes used exclusively for
product development and testing.
(a) Duty-free entry; declaration of use;
extension of liquidation—(1) Entry or
withdrawal for consumption. Articles defined as ‘‘prototypes’’ and meeting the
other requirements prescribed in paragraph (b) of this section may be entered or withdrawn from warehouse for
consumption, duty-free, under subheading 9817.85.01, Harmonized Tariff
Schedule
of
the
United
States
(HTSUS), on CBP Form 7501 or an electronic equivalent. A separate entry or
withdrawal must be made for a qualifying prototype article each time the
article is imported/reimported to the
United States.
(2) Importer declaration. (i) Entry accepted as declaration. Entry or withdrawal from warehouse for consumption under HTSUS subheading 9817.85.01

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U.S. Customs and Border Protection, DHS; Treasury
may be accepted by the port director as
an effective declaration that the articles will be used solely for the purposes
stated in the subheading.
(ii) Proof (declaration) of actual use. If
it is believed the circumstances so warrant, the port director may request the
submission of proof of actual use, executed and dated by the importer. The
title of the party executing the proof of
actual use must be set forth. If proof of
actual use is requested, the importer
must provide it within three years
after the date the article is entered or
withdrawn from warehouse for consumption. Liquidation of the related
entry may be extended until the requested proof or declaration of actual
use is received or until the three-year
period from the date of entry allowed
for the receipt of such proof has expired. While requested proof of use
must be given to CBP within three
years of the date of entry, the prototype may continue to be used thereafter for the purposes enumerated in
HTSUS subheading 9817.85.01. If requested proof of use is not timely received, the entry will be liquidated as
dutiable under the tariff provision that
would otherwise apply to the imported
article. While there is no particular
form for this declaration, it may either
be submitted in writing, or electronically as authorized by CBP, and must
include the following:
(A) A description of the use that is
being and/or that has been made of the
articles set forth in sufficient detail so
as to enable the port director to determine whether the articles have been
entitled to entry as claimed;
(B) A statement that the articles
have not and are not to be put to any
other use after the articles have been
entered or withdrawn from warehouse
for consumption and prior to the completion of their use under HTSUS
9817.85.01 (also see paragraphs (c) and
(d) of this section concerning the disposition(s) to which the articles may
be put following their use under
HTSUS subheading 9817.85.01); and
(C) A statement that the articles or
any parts of the articles have not been
and are not intended to be sold, or incorporated into other products that are
sold, after the articles have been entered or withdrawn from warehouse for

§ 10.91

consumption and prior to the completion of their use as provided in HTSUS
subheading 9817.85.01 ( see paragraph
(b)(2)(ii) of this section).
(b) Articles classifiable as prototypes—
(1) Prototypes defined. In accordance
with U.S. Note 6(a) to subchapter XVII
of chapter 98, HTSUS, applicable to
subheading 9817.85.01, the term ‘‘prototypes’’ means originals or models of articles pertaining to any industry that:
(i) Are either in the preproduction,
production or postproduction stage and
are to be used exclusively for development, testing, product evaluation, or
quality control purposes (not including
automobile racing for purse, prize or
commercial competition); and
(ii) In the case of originals or models
of articles that are either in the production or postproduction stage, are
associated with a design change from
current production (including a refinement, advancement, improvement, development or quality control in either
the product itself or the means of producing the product).
(2) Additional requirements. In accordance with U.S. Note 6(b) and (c) to subchapter XVII of chapter 98, HTSUS, applicable to subheading 9817.85.01, the
following additional restrictions apply
to articles that may be classified as
prototypes:
(i) Importations limited. Prototypes
may be imported pursuant to this section only in limited noncommercial
quantities in accordance with industry
practice.
(ii) Sale prohibited after entry and prior
to use. Prototypes or parts of prototypes may not be sold, or be incorporated into other products that are
sold into the commerce of the United
States, after the prototypes have been
entered or withdrawn from warehouse
for consumption under HTSUS subheading 9817.85.01, except that, after
having been used for the purposes for
which they were entered or withdrawn
from warehouse under HTSUS subheading 9817.85.01, such prototypes or
any part(s) of the prototypes may be
sold as scrap, waste, or for recycling,
as prescribed in paragraph (c) of this
section.
(iii) Articles subject to laws of another
agency. Articles that are subject to licensing requirements, or that must

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§ 10.91

19 CFR Ch. I (4–1–11 Edition)

comply with laws, rules or regulations
administered by an agency other than
CBP before being imported, may be entered as prototypes pursuant to this
section if they meet all applicable provisions of law and otherwise meet the
definition of prototypes in paragraph
(b)(1) of this section.
(iv) Articles excluded from being prototypes. Articles that are in fact subject
at the time of entry to quantitative restrictions, antidumping orders or countervailing duty orders are excluded
from being classified as prototypes
under this section.
(c) Sale of prototype following use—(1)
Sale. Prototypes or any part(s) of prototypes, after having been used for the
purposes for which they were entered
or withdrawn under HTSUS subheading
9817.85.01, may only be sold as scrap,
waste, or for recycling. This includes a
prototype or any part thereof that is
incorporated into another product, as
scrap, waste, or recycled material. If
sold as scrap, waste, or for recycling,
applicable duty must be paid on the
prototypes or parts as provided in paragraph (c)(3) of this section, at the rate
of duty in effect for such scrap, waste,
or recycled materials at the time the
prototypes were entered or withdrawn
for consumption.
(2) Notice of sale required. If, after a
prototype has been used for the purposes contemplated in HTSUS subheading 9817.85.01, the prototype or any
part(s) of the prototype (including a
prototype or any part that is incorporated into another product) is sold as
scrap, waste, or for recycling, the importer must provide notice of such sale
to the port director where the entry or
withdrawal of the prototype was made.
A notice, in the manner authorized in
paragraph (c)(3) of this section, must
be submitted in connection with the
sale, whether or not duty is payable.
The notice should not be submitted
prior to the submission of proof of actual use, should such proof of actual
use be requested by the port director (
see paragraph (a)(2)(ii) of this section).
(3) Form and content of notice; tender
of duty. While no particular form is required for the notice of sale, a consumption entry (CBP Form 7501), appropriately modified, or an electronic
equivalent as authorized by CBP, may

be used for this purpose. The notice
may be a blanket notice covering all
those sales described in paragraph
(c)(2) of this section that occur over a
quarterly (3-month) calendar period.
Such notice must be filed within 10
business days of the end of the related
quarterly period in which the sale(s)
occurred. If an article sold is dutiable,
the payment of any duty due must be
forwarded together with the notice (see
paragraph (c)(1) of this section). If the
notice is filed electronically, payment
of any duty owed will be handled
through the Automated Clearinghouse
( see § 24.25 of this chapter). The notice
of sale must be executed by the importer, or other person having knowledge of the facts surrounding the sale,
and must include the following:
(i) The identity of the prototype; the
consumption entry number under
which it was imported; a copy of the
declaration of actual use, if proof of actual use was requested under paragraph
(a)(2)(ii) of this section; and a detailed
description of the condition of the prototype following use for the intended
permissible purposes, including any
damage, degradation or deterioration
to the article resulting from such use
and/or otherwise resulting to the article from any other cause prior to its
sale for scrap, waste, or recycling;
(ii) The name and address of the
party to whom the article was sold,
and (if known) the use to which the
party intends to put the article;
(iii) The HTSUS subheading number
for scrap, waste, or recycled material,
as applicable, claimed in connection
with the sale of the prototype, together
with the corresponding rate of duty in
effect at the time the prototype was
originally imported for consumption;
(iv) The value of the prototype article (if dutiable and the duty owed is
based upon value) ( see paragraph (e)(2)
of this section); and
(v) The title of the party executing
the declaration and the date of execution.
(d) Prototypes not sold following use.
As to those prototypes or parts of prototypes that, after having been used as
prescribed under HTSUS subheading
9817.85.01, are disposed of otherwise
than by sale ( see paragraph (c)(1) of
this section), there is no requirement

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U.S. Customs and Border Protection, DHS; Treasury
that the importer notify CBP of any
such alternative disposition. Nor are
there any dutiable consequences that
ensue from any disposition of the merchandise after the merchandise’s use
under HTSUS subheading 9817.85.01
other than sale to the extent authorized under paragraph (c)(1) of this section.
(e) Recordkeeping; retention and production—(1) Recordkeeping. The importer must be prepared to submit to
the CBP officer, if requested, any information, including any supporting documents, reports and records, as was necessary for the preparation of the declaration of use, if the declaration of use
was requested under paragraph (a)(2)(ii)
of this section, and the notice of sale,
if applicable under paragraph (c)(3) of
this section. The notices, together with
any related supporting evidence, may
be subject to such verification as the
port director reasonably deems necessary. Supporting documentary evidence must be made available to the
CBP officer, upon request, for a period
of five years (see § 163.4(a) of this chapter) from the date of filing in complete
and proper form, the declaration of use,
if requested, and, if applicable, the notice of sale. The supporting records
must be made available to the CBP officer upon request in accordance with
§ 163.6 of this chapter.
(i) Documents supporting the proof
(declaration) of actual use must:
(A) Establish that the identity and
description of the prototype article is
the same article that the consumption
entry was made for under subheading
9817.85.01, HTSUS; and
(B) Describe the circumstances of the
use of the article; the operations, testing, review, manipulation, experimentation, and/or other exercises that are
being and/or that have been conducted
in connection with the prototype; and
the location, such as the plant or production facility, where these activities
occurred, sufficient to demonstrate
that the purposes enumerated in
HTSUS subheading 9817.85.01 are taking and/or have actually taken place.
(ii) Documents supporting the notice
of sale must establish that:
(A) The identity of the prototype sold
is the same article for which a consumption entry was made under sub-

§ 10.91

heading 9817.85.01 HTSUS when it was
imported, and that the article was in
the condition described in the notice of
sale;
(B) The article was sold to the party
identified in the notice of sale;
(C) The HTSUS subheading number
for scrap, waste, or recycled material,
as applicable, claimed in connection
with the sale of the prototype is accurate;
(D) The date that the prototype was
originally imported for consumption,
and the corresponding rate of duty in
effect at the time for the applicable
HTSUS subheading; and
(E) The value of the prototype article
(if dutiable and the duty owed is based
upon value) ( see paragraph (e)(2) of
this section) as claimed in the notice of
sale is accurate.
(2) Relevant value for used prototype or
parts sold. For purposes of this section,
with respect to any duty owed on prototypes or parts of prototypes that are
sold as scrap, or waste, or for recycling, where the duty owed is based
upon value, the relevant value is the
market value of the prototypes or
parts, based upon their character and
condition following use for the purposes prescribed in HTSUS subheading
9817.85.01. The relevant value should
take into consideration any damage,
degradation or deterioration to the
prototypes or parts resulting from
their use as a prototype and/or otherwise resulting to the articles from any
other cause prior to their sale as scrap,
waste, or for recycling. The market
value will generally be measured by
the selling price. Should a prototype or
part of a prototype become a component of another product that is sold as
scrap, waste, or recycled material, the
relevant market value would be that
portion of the selling price attributable
to the component (prototype or part)
as provided in this paragraph.
(f) Articles admitted under TIB—(1)
Duty-free entry available. Under the procedure presented in paragraph (f)(2) of
this section, an entry of an article
made under a temporary importation
bond (TIB) solely for testing, experimental or review purposes under
HTSUS subheading 9813.00.30 may be
converted into a duty-free entry under

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§§ 10.92–10.97

19 CFR Ch. I (4–1–11 Edition)

HTSUS subheading 9817.85.01, if the following conditions exist:
(i) The article meets the definition
for ‘‘prototypes’’ in paragraph (b) of this
section (U.S. Note 6(a) to subchapter
XVII, chapter 98, HTSUS); and
(ii) The TIB entry for the article was
in effect and had not been closed, and
the TIB period for the article had not
expired, as of November 9, 2000.
(2) Procedure for converting TIB entry
to duty-free entry—(i) Importer request.
The importer must submit a written
request, or an electronic equivalent as
authorized by CBP, that a TIB entry
made
under
HTSUS
subheading
9813.00.30, which was in effect and had
not been closed, and for which the TIB
period had not expired, as of November
9, 2000, be converted instead into a
duty-free consumption entry under
HTSUS subheading 9817.85.01.
(ii) Action by CBP. CBP will convert
the TIB entry under HTSUS subheading 9813.00.30 to a duty-free entry
under HTSUS subheading 9817.85.01,
provided that the port director is satisfied that the conditions set forth in
paragraphs (f)(1)(i) and (f)(1)(ii) of this
section have been met. When the TIB
entry is converted, the bond will be
cancelled and the entry closed. Once
the conversion is complete, the port director will provide a courtesy acknowledgment to this effect to the importer
in writing or electronically.
[CBP Dec. 04–36, 69 FR 63449, Nov. 2, 2004]

§§ 10.92–10.97

[Reserved]

FLUXING MATERIAL
§ 10.98 Copper-bearing fluxing material.
(a) For the purpose of this section,
ores usable as a flux or sulphur reagent, mentioned in the provision for
such ores in subheading 2603.00.00, Harmonized Tariff Schedule of the United
States, shall include only ores which
contain by weight not over 15 percent
copper.
(b) [Reserved]
(c) There shall be filed in connection
with the entry of such copper-bearing
ores, either for consumption or warehouse, a declaration of the importer
that the material is to be used for
fluxing purposes only. In the case of a

consumption entry, the estimated tax
shall be deposited at the time of entry.
Liquidation of entries shall be suspended pending proof of use for fluxing
purposes as hereinafter provided.
(d) Samples of the material shall be
taken in accordance with the commercial method in effect at the plant if to
be used in a bonded smelting warehouse, or in accordance with §§ 151.52
through 151.55 of this chapter if entered
for consumption, and the copper content thereof shall be determined by the
Government chemist in accordance
with the assay.
(e) The management of the smelting
or converting plant shall file with the
appropriate Customs officer at the port
or ports where the entries are to be liquidated, a statement based on its
records of operation for each quarterly
period showing for each furnace or converter the total quantity of material
charged during each month or part
thereof of each quarter, the total quantity of material used for fluxing purposes, and the quantity of imported
ores used for fluxing purposes for which
free entry was claimed under the
above-mentioned provision, together
with the copper content of such imported ores computed in accordance
with the Government assay. If the
quantity of ores used for fluxing purposes in any furnace or converter during any month or part thereof of any
quarter is in excess of 25 percent of the
charge of such furnace or converter,
the quarterly statement shall be accompanied by an explanation of the necessity for using such quantity for
fluxing purposes.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 73–175, 38 FR 17445, July 2, 1973; T.D. 87–
75, 52 FR 20067, May 29, 1987; T.D. 89–1, 53 FR
51251, Dec. 21, 1988]

ETHYL ALCOHOL
§ 10.99 Importation of ethyl alcohol for
nonbeverage purposes.
(a) If claim is made by an importer
other than the United States or a governmental agency thereof for the classification of ethyl alcohol of an alcoholic strength by volume of 80 percent
volume or higher under subheading
2207.10.60, Harmonized Tariff Schedules
of the United States, the importer or

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U.S. Customs and Border Protection, DHS; Treasury
his agent shall file in connection with
the entry a declaration that the alcohol is to be used for nonbeverage purposes only and whether the alcohol is
to be used for fuel purposes. Customs
shall release the alcohol for transfer,
under internal revenue bond, to a distilled spirits plant upon deposit of estimated duty, if any, and without the
payment of the internal revenue tax
upon receipt of a transfer record for
bulk spirits. In addition, a package
gauge record must be submitted to
Customs if the alcohol is in packages,
as specified in subpart I of part 251, Bureau of Alcohol, Tobacco and Firearms
(BATF) Regulations (27 CFR part 251,
subpart I). The transfer shall be accomplished in accordance with subpart L of
part 251, Bureau of Alcohol, Tobacco
and Firearms Regulations (27 CFR part
251, subpart L).
(b) An appropriate BATF permit
shall be filed with Customs in connection with the withdrawal of ethyl alcohol from Customs custody by the
United States or any governmental
agency thereof for its own use for nonbeverage purposes. Such permit shall
be filed before release under the entry
without the deposit of estimated duties, if any, and internal revenue tax,
or before release in accordance with
the provisions of § 141.102(d) of this
chapter. (See subpart M of part 251, Bureau of Alcohol, Tobacco and Firearms
Regulations (27 CFR part 251, subpart
M)).
(c) The procedures for the withdrawal
free of tax on the entry of ethyl alcohol
for nonbeverage purposes from the Virgin Islands are found in subpart O of
part 250, Bureau of Alcohol, Tobacco
and Firearms Regulations (27 CFR part
250, subpart O).
[T.D. 89–65, 54 FR 28413, July 6, 1989]

UNITED STATES GOVERNMENT
IMPORTATIONS
§ 10.100 Entry, examination, and tariff
status.
Except as otherwise provided for in
§§ 10.101,
10.102,
10.104,
141.83(d)(8),
141.102(d), or elsewhere in this chapter,
importations made by or for the account of any agency or office of the
United States Government are subject
to the usual Customs entry and exam-

§ 10.101

ination requirements. In the absence of
express exemptions from duty, such as
are contained in subheadings 9808.00.10,
9808.00.20, 9808.00.30, 9808.00.40, 9808.00.50,
9808.00.60, 9808.00.70, or other subheadings in the Harmonized Tariff
Schedule of the United States (19
U.S.C. 1202) providing for free entry,
such importations are also subject to
duty.
[T.D. 77–23, 42 FR 2310, Jan. 11, 1977, as
amended by T.D. 89–1, 53 FR 51251, Dec. 21,
1988; T.D. 97–82, 62 FR 51769, Oct. 3, 1997]

§ 10.101 Immediate delivery.
(a) Shipments entitled to immediate delivery. Shipments consigned to or for
the account of any agency or office of
the United States Government, or to
an officer or official of any such agency
in his official capacity, shall be regarded for purposes of these regulations as shipments the immediate delivery of which is necessary within the
purview of section 448(b), Tariff Act of
1930, as amended (19 U.S.C. 1448(b)).
(b) Immediate delivery applications.
The shipments described in the preceding paragraph may be released upon
the filing of immediate delivery applications on Customs Form 3461 as set
forth in subpart A of part 142 of this
chapter. Such applications may be limited to particular shipments or may
cover all shipments imported by the
Government agency making the application. They may be approved for specific periods of time or for indefinite
periods of time, provided in either case
they are supported by carrier’s certificates and stipulations as provided for
in paragraph (c) of this section.
(c) Carrier’s certificates and stipulations. Before the release of a shipment
under an immediate delivery permit,
evidence of the right of the applicant
to make entry for the articles shall be
furnished the port director in accordance with the provisions of §§ 141.11 and
141.12 of this chapter.
(d) Bond. No bond shall be required in
support of an immediate delivery application provided for in this section if a
stipulation in the form as set forth
below is filed with the port director in
connection with the application:
I, llll, llll (Title), a duly authorized representative of the ——————————
llllllllllllllllllllllll

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§ 10.102

19 CFR Ch. I (4–1–11 Edition)

(Name of United States Government department or agency) stipulate and agree on behalf of such department or agency that all
applicable provisions of the Tariff Act of
1930, as amended, and the regulations thereunder, and all other laws and regulations, relating to the release and entry of merchandise will be observed and complied with in
all respects.
————————————
(Signature)

(e) Timely entries required. If proper
entries for consumption for importations released under these regulations
are not filed within a reasonable time,
appropriate steps shall be taken to insure the prompt filing of such entries.
[T.D. 77–23, 42 FR 2310, Jan. 11, 1977, as
amended by T.D. 87–75, 52 FR 20067, May 29,
1987]

§ 10.102 Duty-free entries.
(a) Invoice or declaration. No invoice
or other declaration of the shipper
shall be required for shipments expressly exempt from duty as provided
in subheadings 9808.00.10, 9808.00.20,
9808.00.30, 9808.00.40, 9808.00.50, 9808.00.60,
9808.00.70, or other subheadings in the
Harmonized Tariff Schedule of the
United States (HTSUS) (19 U.S.C. 1202)
providing for free entry. However, the
importing Government agency or office
shall present any invoice, memorandum invoice, or bill pertaining to
the merchandise in its possession or
available to it, or, if no such invoice or
bill is available, a pro forma invoice
prepared in accordance with § 141.85 of
this chapter, setting forth adequate information for examination and determination of the dutiable status of the
merchandise. In addition, the port director shall only admit articles free of
duty under subheadings 9808.00.30,
9808.00.40, 9808.00.50, HTSUS (19 U.S.C.
1202), upon the receipt of a certificate
executed in the manner and form described in paragraph (b) of this section.
(b) Certification. One of the following
certificates executed by a duly authorized officer or official of the appropriate Government agency or office is
required for free entry of articles under
subheadings 9808.00.30, 9808.00.40, or
9808.00.50, HTSUS (19 U.S.C. 1202). The
certificates may be printed, stamped,
or typewritten on the Customs entry or
withdrawal form, Customs Form 7501,
or on a separate paper attached to the

entry or withdrawal form filed by the
Government agency or office, provided
the certification is clearly and unmistakably identified with the articles
covered by the entry or withdrawal.
(1) Articles for military departments,
subheading 9808.00.30, HTSUS. I certify
that the procurement of this material
constituted an emergency purchase of
war material abroad by the Department of the (name of military department), and it is accordingly requested
that such material be admitted free of
duty pursuant to subheading 9808.00.30,
HTSUS.
llllllllllllllllllllllll
(Name)
llllllllllllllllllllllll
(Title), who has been designated to execute
free-entry certificates for the above-named
department.
llllllllllllllllllllllll
(Grade or Rank) (Organization)

(2) Articles for the Defense Logistics
Agency, subheading 9808.00.40, HTSUS.
Pursuant to subheading 9808.00.40,
HTSUS, I hereby certify that the
above-described materials are strategic
and critical materials procured under
the Strategic and Critical Materials
Stock Piling Act (50 U.S.C. 98e).
llllllllllllllllllllllll
(Name)
llllllllllllllllllllllll
(Title), Defense Logistics Agency, who has
been duly authorized to execute the above
certificate.

(3) Articles for the Department of Energy, subheading 9808.00.50, HTSUS. I
certify to the Secretary of the Treasury that the above-described materials
are source materials purchased abroad,
the admittance of which is necessary in
the interest of the common defense and
security, in accordance with subheading 9808.00.50, HTSUS.
llllllllllllllllllllllll
(Name)
llllllllllllllllllllllll
(Title), who has been authorized to execute
free-entry certificates for the Department
of Energy.

(c) Release of shipments. Shipments
for which free entry has been or will be
claimed under subheading 9808.00.30,
9808.00.40, 9808.00.50, HTSUS (19 U.S.C.
1202), shall be released after only such
examination as is necessary to identify
them.

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U.S. Customs and Border Protection, DHS; Treasury
(d) Entry in Government name. All materials for which free entry is claimed
under subheading 9808.00.30, 9808.00.40,
9808.00.50, HTSUS (19 U.S.C. 1202), shall
be entered, or withdrawn from warehouse, for consumption in the name of
the Government department whose representative executes the certificate set
forth in § 10.102(b) unless exemption
from this requirement is specifically
authorized by the port director.
[T.D. 77–23, 42 FR 2311, Jan. 11, 1977, as
amended by T.D. 85–123, 50 FR 29953, July 23,
1985; T.D. 89–1, 53 FR 51251, Dec. 21, 1988; T.D.
93–44, 58 FR 34523, June 28, 1993; T.D 95–81, 60
FR 52295, Oct. 6, 1995]

§ 10.103 American goods returned.
(a) Certificate required. Articles entered, or withdrawn from warehouse,
for consumption in the name of an
agency or office of the United States
Government (with the exception of
military scrap belonging to the Department of Defense) may be admitted free
of duty under subheading 9801.00.10,
Harmonized Tariff Schedule of the
United States (HTSUS) (19 U.S.C. 1202),
upon the filing of a certificate on the
letterhead of the agency or office in
the following form in lieu of other
entry documentation:
I hereby certify:
1. That the following articles imported in
the llllllllllll (Name of Carrier)
at the port of llllllllllll (Port)
on llllll (Date) consist of returned
products which are the growth, produce, or
manufacture of the United States, and have
been returned to the United States without
having been advanced in value or improved
in condition by any process of manufacture
or other means, and that no drawback has
been or will be claimed on such articles, and
that the articles currently belonging to and
are
for
the
further
use
of
llllllllllll (Agency or Office)
Number of containers

Bill of lading
No. 1

General description of
articles

1 If shipment arrives in the United States on a commercial
carrier.

2. That the shipment does not contain
military scrap.
3. That the shipment is entitled to entry
under subheading 9801.00.10, Harmonized Tariff Schedule of the United States (HTSUS)
free of duty.

§ 10.104

4. That I am a military installation transportation officer having knowledge of the
facts involved in this certificate.
or
I am an officer or official authorized by
llllllll (Agency or Office) (Whichever is applicable) to execute this certificate.
llllllllllllllllllllllll
(Name)
llllllllllllllllllllllll
(Rank and branch of service or Agency or
Office)

(b) Combined certificate when articles
are intermingled. When articles claimed
to be free under subheading 9801.00.10
and other articles claimed to be free
under subheadings 9808.00.30, 9808.00.40,
9808.00.50, HTSUS (19 U.S.C. 1202), are
intermingled in a single shipment in a
manner which precludes separation for
the purpose of making claims for free
entry under the separate categories, all
the articles may be covered by a combined certificate which follows the requirements of § 10.102(b) and paragraph
(a) of this section.
(c) Execution of certificate. The certificate required by paragraph (a) of this
section may be executed by any military installation transportation officer
having knowledge of the facts or by
any other officer or official specifically
designated or authorized to execute
such certificates by the importing Government agency or office. If the merchandise arrived on a commercial carrier, the entry shall be supported by
evidence of the right to make it.
[T.D. 77–23, 42 FR 2311, Jan. 11, 1977, as
amended by T.D. 89–1, 53 FR 51251, Dec. 21,
1988]

§ 10.104 Temporary importation entries for United States Government
agencies.
The entry of articles brought into
the United States temporarily by an
agency or office of the United States
Government and claimed to be exempt
from duty under Chapter 98, Subchapter XIII, Heading 9813, Harmonized
Tariff Schedule of the United States
(HTSUS), shall be made on Customs
Form 7501. No bond shall be required if
the agency or office files a stipulation
in the form set forth in § 141.102(d) of
this chapter. In those cases in which
the provisions of Chapter 98, Subchapter XIII, HTSUS (19 U.S.C. 1202),

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§ 10.106

19 CFR Ch. I (4–1–11 Edition)

are not met, however, the port director
will proceed as if a bond had been filed
to cover the particular importation.
Articles temporarily imported by a
Government agency or office under this
section are entitled to immediate delivery under the procedures set forth in
§ 10.101.
[T.D. 77–23, 42 FR 2311, Jan. 11, 1977, as
amended by T.D. 89–1, 53 FR 51251, Dec. 21,
1988]

in the United States otherwise than for
a purpose contemplated for it by section 322(b), or which is not exported
within 90 days after its arrival in the
United States, or within such longer
time as may be specially authorized by
the port director or Headquarters, U.S.
Customs Service, shall be seized and
forfeited to the United States.
[28 FR 14663, Dec. 31, 1963, as amended by
T.D. 89–1, 53 FR 51252, Dec. 21, 1988]

WHEAT
§ 10.106

PRODUCTS EXPORTED UNDER LEASE AND
REIMPORTED

[Reserved]

RESCUE AND RELIEF WORK

§ 10.108 Entry of reimported articles
exported under lease.

§ 10.107 Equipment and supplies; admission.
(a) There shall be admitted without
entry and without the payment of duty
or any tax imposed upon or by reason
of importation of any article described
in section 322(b), Tariff Act of 1930, as
amended, subject to compliance with
the following conditions:
(1) Before importation or as soon
thereafter as possible, and in every
case before the expiration of 10 days
after importation, a report shall be
made to the nearest Customs officer by
the person in charge of sending the article from the foreign country, or by
the person for whose account it was
brought into the United States, stating
the character, quantity, destination,
and use to be made of the article.
(2) If practicable, the article shall be
exported under Customs supervision. In
any other case a report shall be made
by the person in charge of the exportation as soon as possible after exportation to the Customs officer to whom
the arrival was reported, stating the
character, quantity, and circumstances
of the exportation.
(b) In the case of each article admitted under paragraph (a) of this section,
the port director shall satisfy himself
as to whether the article was exported
within a reasonable time, or that it has
been properly expended or destroyed. If
an article is so far destroyed, in connection with a use contemplated for it
by section 322 (b) that it has only a salvage value, it shall not be required to
be exported.
(c) Any article admitted under paragraph (a) of this section which is used

Free entry shall be accorded under
subheading 9801.00.20, Harmonized Tariff Schedule of the United States
(HTSUS), whenever it is established to
the satisfaction of the port director
that the article for which free entry is
claimed was duty paid on a previous
importation or was previously entered
free of duty pursuant to the Caribbean
Basin Economic Recovery Act or Title
V of the Trade Act of 1974, is being reimported without having been advanced in value or improved in condition by any process of manufacture or
other means, was exported from the
United States under a lease or similar
use agreement, and is being reimported
by or for the account of the person who
imported it into, and exported it from,
the United States.
[T.D. 94–40, 59 FR 17474, Apr. 13, 1994]

STRATEGIC MATERIALS OBTAINED BY
BARTER OR EXCHANGE
§ 10.110

[Reserved]

LATE FILING OF FREE ENTRY AND
REDUCED DUTY DOCUMENTS
§ 10.112 Filing free entry documents or
reduced duty documents after
entry.
Whenever a free entry or a reduced
duty document, form, or statement required to be filed in connection with
the entry is not filed at the time of the
entry or within the period for which a
bond was filed for its production, but
failure to file it was not due to willful
negligence or fraudulent intent, such
document, form, or statement may be

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U.S. Customs and Border Protection, DHS; Treasury

§ 10.134

filed at any time prior to liquidation of
the entry or, if the entry was liquidated, before the liquidation becomes
final. See § 113.43(c) of this chapter for
satisfaction of the bond and cancellation of the bond charge.

the event that the director of the port
of entry does not receive the required
document within the 90-day period, the
merchandise will be classified and liquidated in the ordinary course, without
regard to subheading 9817.00.40, HTSUS.

[T.D. 74–227, 39 FR 32015, Sept. 4, 1974]

[CBP Dec. 10–33, 75 FR 69585, Nov. 15, 2010]

RATE OF DUTY DEPENDENT UPON
ACTUAL USE

INSTRUMENTS AND APPARATUS FOR EDUCATIONAL AND SCIENTIFIC INSTITUTIONS

§ 10.114 General provisions.
The consolidated regulations of the
Commerce and Treasury Departments
relating to the entry of instruments
and apparatus for educational and scientific institutions are contained in 15
CFR part 301.
[T.D. 82–224, 47 FR 53727, Nov. 29, 1982]

§§ 10.115–10.119

[Reserved]

VISUAL OR AUDITORY MATERIALS
§ 10.121 Visual or auditory materials of
an educational, scientific, or cultural character.
(a) Where photographic film and
other articles described in subheading
9817.00.40, Harmonized Tariff Schedule
of the United States (HTSUS), are
claimed to be free of duty under subheading 9817.00.40, HTSUS, there must
be filed, in connection with the entry
covering such articles, a document
issued by the U.S. Department of State
certifying that it has determined that
the articles are visual or auditory materials of an educational, scientific, or
cultural character within the meaning
of the Agreement for Facilitating the
International Circulation of Visual and
Auditory Materials of an Educational,
Scientific, and Cultural Character as
required by U.S. note 1(a)(i), Subchapter XVII, chapter 98, HTSUS.
(b) Articles entered under subheading
9817.00.40, HTSUS, will be released from
CBP custody prior to submission of the
document required in paragraph (a) of
this section only upon the deposit of
estimated duties with the port director. Liquidation of an entry covering
merchandise which has been released
under this procedure will be suspended
for a period of 90 days from the date of
entry or until the required document is
submitted, whichever occurs first. In

§ 10.131 Circumstances in which applicable.
The provisions of §§ 10.131 through
10.139 are applicable in those circumstances in which the rate of duty
applicable to merchandise is dependent
upon actual use, unless there is a specific provision in this part which governs the treatment of the merchandise.
However, specific marking or certification requirements, such as those for
bolting cloths in section 10.58, may be
applicable to merchandise subject to
the provisions of sections 10.131–10.139.
[T.D. 71–139, 36 FR 10726, June 2, 1971, as
amended by T.D. 86–118, 51 FR 22515, June 20,
1986]

§ 10.132

[Reserved]

§ 10.133 Conditions required to be met.
When the tariff classification of any
article is controlled by its actual use in
the United States, three conditions
must be met in order to qualify for free
entry or a lower rate of duty unless the
language of the particular subheading
of the Harmonized Tariff Schedule of
the United States applicable to the
merchandise specifies other conditions.
The conditions are that:
(a) Such use is intended at the time
of importation.
(b) The article is so used.
(c) Proof of use is furnished within 3
years after the date the article is entered or withdrawn from warehouse for
consumption.
[T.D. 71–139, 36 FR 10726, June 2, 1971, as
amended by T.D. 89–1, 53 FR 51252, Dec. 21,
1988]

§ 10.134 Declaration of intent.
A showing of intent by the importer
as to the actual use of imported merchandise shall be made by filing with
the entry for consumption or for warehouse a declaration as to the intended

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§ 10.135

19 CFR Ch. I (4–1–11 Edition)

use of the merchandise, or by entering
the proper subheading of an actual use
provision of the Harmonized Tariff
Schedule of the United States (HTSUS)
and the reduced or free rate of duty on
the entry form. Entry made under an
actual use provision of the HTSUS may
be construed as a declaration that the
merchandise is entered to be used for
the purpose stated in the HTSUS, provided the port director is satisfied the
merchandise will be so used. However,
the port director shall require a written declaration to be filed if he is not
satisfied that merchandise entered
under an actual use provision will be
used for the purposes stated in the
HTSUS.
[T.D. 71–139, 36 FR 10726, June 2, 1971, as
amended by T.D. 89–1, 53 FR 51252, Dec. 21,
1988]

§ 10.135

Deposit of duties.

When the requirement of § 10.134 has
been met the merchandise may be entered or withdrawn from warehouse for
consumption without deposit of duty
when proof of use will result in free
entry, or with deposit of duty at the
lower rate when proof of use will result
in a lower rate of duty.
[T.D. 71–139, 36 FR 10726, June 2, 1971, as
amended by T.D. 84–213, 49 FR 41166, Oct. 19,
1984]

§ 10.136

Suspension of liquidation.

Liquidation of an entry covering
merchandise for which a declaration of
intent has been made pursuant to
§ 10.134 and any required deposit of duties made, shall be suspended until
proof of use is furnished or the 3-year
period allowed for production thereof
has expired.
[T.D. 71–139, 36 FR 10726, June 2, 1971]

§ 10.137

Records of use.

(a) Maintenance by importer. The importer shall maintain accurate and detailed records showing the use or other
disposition of the imported merchandise. The burden shall be on the importer to keep records so that the
claim of actual use can be readily established.
(b) Retention of records. The importer
shall retain records of use or disposi-

tion for a period of 3 years from the
date of liquidation of the entry.
(c) Examination of records. The records required to be kept by paragraph
(a) of this section shall be available at
all times for examination and inspection by an authorized Customs officer.
[T.D. 71–139, 36 FR 10726, June 2, 1971]

§ 10.138 Proof of use.
Within 3 years from the date of entry
or withdrawal from warehouse for consumption, the importer shall submit in
duplicate in support of his claim for
free entry or for a reduced rate of duty
a certificate executed by (1) the superintendent or manager of the manufacturing plant, or (2) the individual enduser or other person having knowledge
of the actual use of the imported article. The certificate shall include a description of the processing in sufficient
detail to show that the use contemplated by the law has actually
taken place. A blanket certificate covering all purchases of a given type of
merchandise from a particular importer during a given period, or all
such purchases with specified exceptions, may be accepted for this purpose, provided the importer shall furnish a statement showing in detail, in
such manner as to be readily identified
with each entry, the merchandise
which he sold to such manufacturer or
end-user during such period.
[T.D. 71–139, 36 FR 10727, June 2, 1971]

§ 10.139 Liquidation.
(a) In general. Upon satisfactory proof
of timely use of the merchandise for
the purpose specified by law, the entry
shall be liquidated free of duty or at
the lower rate of duty specified by law.
When such proof is not filed within 3
years from the date of entry or withdrawal from warehouse for consumption, the entry shall be liquidated dutiable under the appropriate subheading
of the Harmonized Tariff Schedule of
the United States.
(b) Exception for blackstrap molasses.
An entry covering blackstrap molasses,
as hereinafter defined, may be accepted
and liquidated with duty at the lower
rate after the filing of the declaration
of intent required by § 10.134 and the deposit of estimated duties required by

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U.S. Customs and Border Protection, DHS; Treasury
§ 10.135
without
compliance
with
§§ 10.136, 10.137, and 10.138. Blackstrap
molasses is ‘‘final’’ molasses practically
free from sugar crystals, containing
not over 58 percent total sugars and
having a ratio of
total sugars × 100/Brix
not in excess of 71. In the event of
doubt, an ash determination may be
made. An ash content of not less than
7 percent indicates a blackstrap molasses within the meaning of this paragraph.
[T.D. 71–139, 36 FR 10727, June 2, 1971, as
amended by T.D. 89–1, 53 FR 51252, Dec. 21,
1988]

IMPORTATIONS NOT OVER $200 AND BONA
FIDE GIFTS
§ 10.151 Importations not over $200.
Subject to the conditions in § 10.153 of
this part, the port director shall pass
free of duty and tax any shipment of
merchandise, as defined in § 101.1 of this
chapter, imported by one person on one
day having a fair retail value, as evidenced by an oral declaration or the
bill of lading (or other document filed
as the entry) or manifest listing each
bill of lading, in the country of shipment not exceeding $200, unless he has
reason to believe that the shipment is
one of several lots covered by a single
order or contract and that it was sent
separately for the express purpose of
securing free entry therefor or of
avoiding compliance with any pertinent law or regulation. Merchandise
subject to this exemption shall be entered under the informal entry procedures (see subpart C, part 143, and
§§ 128.24, 145.31, 148.12, and 148.62, of this
chapter).
[T.D. 94–51, 59 FR 30293, June 13, 1994, as
amended by T.D. 95–31, 60 FR 18990, Apr. 14,
1995; T.D. 95–31, 60 FR 37875, July 24, 1995;
T.D. 97–82, 62 FR 51769, Oct. 3, 1997]

§ 10.152 Bona-fide gifts.
Subject to the conditions in § 10.153 of
this part, the port director shall pass
free of duty and tax any article sent as
a bona-fide gift from a person in a foreign country to a person in the United
States, provided that the aggregate
fair retail value in the country of shipment of such articles received by one

§ 10.153

person on one day does not exceed $100
or, in the case of articles sent from a
person in the Virgin Islands, Guam,
and American Samoa, $200. Articles
subject to this exemption shall be entered under the informal entry procedures (see subpart C, part 143, and
§§ 145.32, 148.12, 148.51, and 148.64, of this
chapter). An article is ‘‘sent’’ for purposes of this section if it is conveyed in
any manner other than on the person
or in the accompanied or unaccompanied baggage of the donor or donee.
[T.D. 94–51, 59 FR 30293, June 13, 1994]

§ 10.153 Conditions for exemption.
Customs officers shall be further
guided as follows in determining
whether an article or parcel shall be
exempted from duty and tax under
§ 10.151 or § 10.152:
(a) A ‘‘bona fide gift’’ for purposes of
§ 10.152 is an article formerly owned by
a donor (may be a commercial firm)
who gave it outright in its entirety to
a donee without compensation or
promise of compensation. It does not
include articles acquired by purchase,
barter, promissory exchange, or similar
transaction, nor does it include articles
said to be ‘‘given’’ in conjunction with a
purchase, barter, promissory exchange,
or similar transaction, such as a socalled bonus article.
(b) A parcel addressed to a person in
the United States from an individual in
a foreign country which contains a gift
should be clearly marked on the outside to indicate that it contains a gift.
Such marking is not conclusive evidence of a gift nor is the absence of
such marking conclusive evidence that
an article is not a gift. Ordinarily an
article not exceeding $100 in fair retail
value in the country of shipment sent
from a person in a foreign country to a
person in the United States ($200, in
the case of an article sent from a person in the Virgin Islands, Guam, and
American Samoa) will be recognizable
as a gift from the nature of the article
and obvious facts surrounding the shipment.
(c) A parcel addressed to a person in
the United States from a business firm
in a foreign country would ordinarily
not contain a gift from a donor in the
foreign country. When such a parcel in
fact contains an article entitled to free

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§ 10.171

19 CFR Ch. I (4–1–11 Edition)

entry under § 10.152, the parcel should
be clearly marked to indicate that it
contains such a gift and a statement to
this effect should be enclosed in the
parcel.
(d) Consolidated shipments addressed
to one consignee shall be treated for
purposes of §§ 10.151 and 10.152 as one
importation. The foregoing shall not
apply to shipments of bona fide gifts
consolidated abroad for shipment to
the United States when:
(1) The consolidation for shipment to
the United States is in a cargo van or
similar containerization which is consigned to a common carrier, freight
forwarder, freight handler, or other
public service agency for distribution
of the gift packages;
(2) The separate gifts not exceeding
$100 in fair retail value in the country
of shipment ($200, in the case of articles sent from persons in the Virgin Islands, Guam, and American Samoa) included in the consolidated shipment
are
before
shipment
individually
wrapped and addressed to the donee in
the United States;
(3) Each gift package is marked on
the outside to indicate that it contains
a gift not exceeding $100 in fair retail
value in the country of shipment ($200,
in the case of packages sent from persons in the Virgin Islands, Guam, and
American Samoa); and
(4) Each gift package is separately
listed in the name of the addresseedonee on a packing list, manifest, bill
of lading, or other shipping document.
(e) No alcoholic beverage, perfume
containing alcohol (except where the
aggregate fair retail value in the country of shipment of all merchandise contained in the shipment does not exceed
$5), cigars, or cigarettes shall be exempted from the payment of duty and
tax under § 10.151 or § 10.152.
(f) The exemptions provided for in
§ 10.151 or § 10.152 are not to be allowed
in respect of any shipment containing
one or more gifts having an aggregate
fair retail value in the country of shipment in excess of $100 ($200, in the case
of articles sent from persons in the Virgin Islands, Guam, and American
Samoa), except as indicated in paragraph (d) of this section. For example,
an article ordinarily subject to an ad
valorem rate of duty but sent as a gift,

if the fair retail value exceeds the $100
(or $200) exemption, would be subject to
a duty based upon its value under the
provisions of section 402 or 402(a), Tariff Act of 1930, as amended (19 U.S.C.
1401a or 1402), even though the dutiable
value is less than the $100 (or $200) exemption.
(g) The exemption referred to in
§ 10.151 is not to be allowed in the case
of any merchandise of a class or kind
provided for in any absolute or tariffrate quota, whether the quota is open
or closed. In the case of merchandise of
a class or kind provided for in a tariffrate quota, the merchandise is subject
to the rate of duty in effect on the date
of entry.
[T.D. 73–175, 38 FR 17445, July 2, 1973, as
amended by T.D. 75–185, 40 FR 31753, July 29,
1975; T.D. 78–394, 43 FR 49787, Oct. 25, 1978;
T.D. 85–123, 50 FR 29953, July 23, 1985; T.D. 94–
51, 59 FR 30293, June 13, 1994]

GENERALIZED SYSTEM OF PREFERENCES
§ 10.171

General.

(a) Statutory authority. Title V of the
Trade Act of 1974 as amended (19 U.S.C.
2461–2467) authorizes the President to
establish a Generalized System of Preferences (GSP) to provide duty-free
treatment for eligible articles imported directly from designated beneficiary developing countries. Beneficiary developing countries and articles eligible for duty-free treatment
are designated by the President by Executive order in accordance with sections 502(a)(1) and 503(a) of the Trade
Act of 1974 as amended (19 U.S.C.
2462(a)(1), 2463(a)).
(b) Country defined. For purposes of
§§ 10.171 through 10.178, except as otherwise provided in § 10.176(a), the term
‘‘country’’ means any foreign country,
any overseas dependent territory or
possession of a foreign country, or the
Trust Territory of the Pacific Islands.
In the case of an association of countries which is a free trade area or customs union or which is contributing to
comprehensive regional economic integration among its members through
appropriate means, including but not
limited to, the reduction of duties, the
President may by Executive order provide that all members of such association other than members which are

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U.S. Customs and Border Protection, DHS; Treasury
barred from designation under section
502(b) of the Trade Act of 1974 (19 U.S.C.
2462(b)) shall be treated as one country
for purposes of §§ 10.171 through 10.178.
[T.D. 76–2, 40 FR 60047, Dec. 31, 1975, as
amended by T.D. 80–271, 45 FR 75641, Nov. 17,
1980; T.D. 00–67, 65 FR 59675, Oct. 5, 2000]

§ 10.172 Claim for exemption from
duty under the Generalized System
of Preferences.
A claim for an exemption from duty
on the ground that the Generalized
System of Preferences applies shall be
allowed by the port director only if he
is satisfied that the requirements set
forth in this section and §§ 10.173
through 10.178 have been met. If dutyfree treatment is claimed at the time
of entry, a written claim shall be filed
on the entry document by placing the
symbol ‘‘A’’ as a prefix to the subheading of the Harmonized Tariff
Schedule of the United States for each
article for which such treatment is
claimed.
[T.D. 76–2, 40 FR 60048, Dec. 31, 1975, as
amended by T.D. 77–36, 42 FR 5041, Jan. 27,
1977; T.D. 89–1, 53 FR 51252, Dec. 21, 1988; T.D.
94–47, 59 FR 25569, May 17, 1994; T.D. 99–27, 64
FR 13675, Mar. 22, 1999]

§ 10.173 Evidence of country of origin.
(a) Shipments covered by a formal
entry—(1) Merchandise not wholly the

§ 10.173

growth, product, or manufacture of a beneficiary developing country. (i) Declaration. In a case involving merchandise
covered by a formal entry which is not
wholly the growth, product, or manufacture of a single beneficiary developing country, the exporter of the merchandise or other appropriate party
having knowledge of the relevant facts
shall be prepared to submit directly to
the port director, upon request, a declaration setting forth all pertinent detailed information concerning the production or manufacture of the merchandise. When requested by the port
director, the declaration shall be prepared in substantially the following
form:
GSP DECLARATION
I,
lllllllllllllllllllll
(name), hereby declare that the articles described below were produced or manufactured in llllllll (country) by means
of processing operations performed in that
country as set forth below and were also subjected to processing operations in the other
country or countries which are members of
the same association of countries as set
forth below and incorporate materials produced in the country named above or in any
other country or countries which are members of the same association of countries as
set forth below:
Processing operations performed on articles

Number and date of invoices

Description of
articles and
quantity

Description of
processing operations and
country of
processing

Date lllllllllllllllllllll
Address lllllllllllllllllll
Signature llllllllllllllllll
Title lllllllllllllllllllll

(ii) Retention of records and submission
of declaration. The information necessary for preparation of the declaration shall be retained in the files of the
party responsible for its preparation

Direct costs of
processing operations

Materials produced in a beneficiary developing country or
members of the same association
Description of
material, production process, and country of production

Cost or value
of material

and submission for a period of 5 years.
In the event that the port director requests submission of the declaration
during the 5-year period, it shall be
submitted by the appropriate party directly to the port director within 60
days of the date of the request or such
additional period as the port director

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§ 10.174

19 CFR Ch. I (4–1–11 Edition)

may allow for good cause shown. Failure to submit the declaration in a
timely fashion will result in a denial of
duty-free treatment.
(2) Merchandise wholly the growth,
product, or manufacture of a beneficiary
developing country. In a case involving
merchandise covered by a formal entry
which is wholly the growth, product, or
manufacture of a single beneficiary developing country, a statement to that
effect shall be included on the commercial invoice provided to Customs.
(b) Shipments covered by an informal
entry. Although the filing of the declaration provided for in paragraph
(a)(1)(i) of this section will not be required for a shipment covered by an informal entry, the port director may require such other evidence of country of
origin as deemed necessary.
(c) Verification of documentation. Any
evidence of country of origin submitted
under this section shall be subject to
such verification as the port director
deems necessary. In the event that the
port director is prevented from obtaining the necessary verification, the port
director may treat the entry as dutiable.
[T.D. 94–47, 59 FR 25569, May 17, 1994]

§ 10.174

Evidence of direct shipment.

(a) Documents constituting evidence of
direct shipment. The port director may
require that appropriate shipping papers, invoices, or other documents be
submitted within 60 days of the date of
entry as evidence that the articles
were ‘‘imported directly’’, as that term
is defined in § 10.175. Any evidence of direct shipment required by the port director shall be subject to such
verification as he deems necessary.
(b) Waiver of evidence of direct shipment. The port director may waive the
submission of evidence of direct shipment when he is otherwise satisfied,
taking into consideration the kind and
value of the merchandise, that the
merchandise clearly qualifies for treatment under the Generalized System of
Preferences.
[T.D. 76–2, 40 FR 60048, Dec. 31, 1975, as
amended by T.D. 77–27, 42 FR 3162, Jan. 17,
1977]

§ 10.175 Imported directly defined.
Eligible articles shall be imported directly from a beneficiary developing
country to qualify for treatment under
the Generalized System of Preferences.
For purposes of §§ 10.171 through 10.178
the words ‘‘imported directly’’ mean:
(a) Direct shipment from the beneficiary country to the United States
without passing through the territory
of any other country; or
(b) If the shipment is from a beneficiary developing country to the U.S.
through the territory of any other
country, the merchandise in the shipment does not enter into the commerce
of any other country while en route to
the U.S., and the invoice, bills of lading, and other shipping documents
show the U.S. as the final destination;
or
(c) If shipped from the beneficiary developing country to the United States
through a free trade zone in a beneficiary developing country, the merchandise shall not enter into the commerce of the country maintaining the
free trade zone, and
(1) The eligible articles must not undergo any operation other than:
(i) Sorting, grading, or testing,
(ii) Packing, unpacking, changes of
packing, decanting or repacking into
other containers,
(iii) Affixing marks, labels, or other
like distinguishing signs on articles or
their packing, if incidental to operations allowed under this section, or
(iv) Operations necessary to ensure
the preservation of merchandise in its
condition as introduced into the free
trade zone.
(2) Merchandise may be purchased
and resold, other than at retail, for export within the free trade zone.
(3) For the purposes of this section, a
free trade zone is a predetermined area
or region declared and secured by or
under governmental authority, where
certain operations may be performed
with respect to articles, without such
articles having entered into the commerce of the country maintaining the
free trade zone; or
(d) If the shipment is from any beneficiary developing country to the U.S
through the territory of any other
country and the invoices and other
documents do not show the U.S as the

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U.S. Customs and Border Protection, DHS; Treasury
final destination, the articles in the
shipment upon arrival in the U.S. are
imported directly only if they:
(1) Remained under the control of the
customs authority of the intermediate
country;
(2) Did not enter into the commerce
of the intermediate country except for
the purpose of sale other than at retail,
and the port director is satisfied that
the importation results from the original commercial transaction between
the importer and the producer or the
latter’s sales agent; and
(3) Were not subjected to operations
other than loading and unloading, and
other activities necessary to preserve
the articles in good condition; or
(e)(1) Shipment to the U.S. from a
beneficiary developing country which
is a member of an association of countries treated as one country under section 507(2), Trade Act of 1974, as amended (19 U.S.C. 2467(2)), through the territory of a former beneficiary developing
country whose designation as a member of the same association for GSP
purposes was terminated by the President pursuant to section 502(d), Trade
Act of 1974, as amended (19 U.S.C.
2462(d)), provided the articles in the
shipment did not enter into the commerce of the former beneficiary developing country except for purposes of
performing one or more of the operations specified in paragraph (c)(1) of
this section and except for purposes of
purchase or resale, other than at retail,
for export.
(2) The designation of the following
countries as members of an association
of countries for GSP purposes has been
terminated by the President pursuant
to section 502(d) of the Trade Act of
1974 (19 U.S.C. 2462(d)):
The Bahamas
Brunei Darussalam
Malaysia
Singapore
[T.D. 76–2, 40 FR 60048, Dec. 31, 1975, as
amended by T.D. 83–144, 48 FR 29684, June 28,
1983; T.D. 84–237, 49 FR 47992, Dec. 7, 1984;
T.D. 86–107, 51 FR 20816, June 9, 1986; T.D. 92–
6, 57 FR 2018, Jan. 17, 1992; T.D. 94–47, 59 FR
25569, May 17, 1994; T.D. 95–30, 60 FR 18543,
Apr. 12, 1995; T.D. 00–67, 65 FR 59675, Oct. 5,
2000]

§ 10.176

§ 10.176 Country of origin criteria.
(a) Merchandise produced in a beneficiary developing country or any two or
more countries which are members of the
same association of countries—(1) General. Except as otherwise provided in
this section, any article which either is
wholly the growth, product, or manufacture of, or is a new or different article of commerce that has been grown,
produced, or manufactured in, a beneficiary developing country may qualify
for duty-free entry under the Generalized System of Preferences (GSP). No
article will be considered to have been
grown, produced, or manufactured in a
beneficiary developing country by virtue of having merely undergone simple
(as opposed to complex or meaningful)
combining or packaging operations or
mere dilution with water or mere dilution with another substance that does
not materially alter the characteristics
of the article. Duty-free entry under
the GSP may be accorded to an article
only if the sum of the cost or value of
the materials produced in the beneficiary developing country or any two
or more countries that are members of
the same association of countries and
are treated as one country under section 507(2) of the Trade Act of 1974, as
amended (19 U.S.C. 2467(2)), plus the direct costs of processing operations performed in the beneficiary developing
country or member countries, is not
less than 35 percent of the appraised
value of the article at the time it is entered.
(2) Combining, packaging, and diluting
operations. No article which has undergone only a simple combining or packaging operation or a mere dilution in a
beneficiary developing country within
the meaning of paragraph (a)(1) of this
section will be entitled to duty-free
treatment even though the processing
operation causes the article to meet
the value requirement set forth in that
paragraph. For purposes of this section:
(i) Simple combining or packaging
operations and mere dilution include,
but are not limited to, the following:
(A) The addition of batteries to devices;
(B) Fitting together a small number
of components by bolting, glueing, soldering, etc.;

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§ 10.177

19 CFR Ch. I (4–1–11 Edition)

(C) Blending foreign and beneficiary
developing country tobacco;
(D) The addition of substances such
as anticaking agents, preservatives,
wetting agents, etc.;
(E) Repacking or packaging components together;
(F) Reconstituting orange juice by
adding water to orange juice concentrate; and
(G) Diluting chemicals with inert ingredients to bring them to standard degrees of strength;
(ii) Simple combining or packaging
operations and mere dilution will not
be taken to include processes such as
the following:
(A) The assembly of a large number
of discrete components onto a printed
circuit board;
(B) The mixing together of two bulk
medicinal substances followed by the
packaging of the mixed product into
individual doses for retail sale;
(C) The addition of water or another
substance to a chemical compound
under pressure which results in a reaction creating a new chemical compound; and
(D) A simple combining or packaging
operation or mere dilution coupled
with any other type of processing such
as testing or fabrication (for example,
a simple assembly of a small number of
components, one of which was fabricated in the beneficiary developing
country where the assembly took
place); and
(iii) The fact that an article has undergone more than a simple combining
or packaging operation or mere dilution is not necessarily dispositive of
the question of whether that processing constitutes a substantial transformation for purposes of determining
the country of origin of the article.
(b) [Reserved]
(c) Merchandise grown, produced, or
manufactured in a beneficiary developing
country. Merchandise which is wholly
the growth, product, or manufacture of
a beneficiary developing country, or an
association of countries treated as one
country under section 507(2) of the
Trade Act of 1974 (19 U.S.C. 2467(2)) and
§ 10.171(b), and manufactured products
consisting of materials produced only
in such country or countries, shall nor-

mally be presumed to meet the requirements set forth in this section.
[T.D. 76–2, 40 FR 60048, Dec. 31, 1975, as
amended by T.D. 80–271, 45 FR 75641, Nov. 17,
1980; T.D. 00–67, 65 FR 59675, Oct. 5, 2000]

§ 10.177 Cost or value of materials produced in the beneficiary developing
country.
(a) ‘‘Produced in the beneficiary developing country’’ defined. For purposes of
§§ 10.171 through 10.178, the words ‘‘produced in the beneficiary developing
country’’ refer to the constituent materials of which the eligible article is
composed which are either:
(1) Wholly the growth, product, or
manufacture of the beneficiary developing country; or
(2) Substantially transformed in the
beneficiary developing country into a
new and different article of commerce.
(b) Questionable origin. When the origin of an article either is not ascertainable or not satisfactorily demonstrated
to the port director, the article shall
not be considered to have been produced in the beneficiary developing
country.
(c) Determination of cost or value of
materials produced in the beneficiary developing country. (1) The cost or value
of materials produced in the beneficiary developing country includes:
(i) The manufacturer’s actual cost for
the materials;
(ii) When not included in the manufacturer’s actual cost for the materials,
the freight, insurance, packing, and all
other costs incurred in transporting
the materials to the manufacturer’s
plant;
(iii) The actual cost of waste or spoilage (material list), less the value of recoverable scrap; and
(iv) Taxes and/or duties imposed on
the materials by the beneficiary developing country, or an association of
countries treated as one country, provided they are not remitted upon exportation.
(2) Where the material is provided to
the manufacturer without charge, or at
less than fair market value, its cost or
value shall be determined by computing the sum of:

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U.S. Customs and Border Protection, DHS; Treasury
(i) All expenses incurred in the
growth, production, manufacture or assembly of the material, including general expenses;
(ii) An amount for profit; and
(iii) Freight, insurance, packing, and
all other costs incurred in transporting
the materials to the manufacturer’s
plant.
If the pertinent information needed to
compute the cost or value of the materials is not available, the appraising officer may ascertain or estimate the
value thereof using all reasonable ways
and means at his disposal.
[T.D. 76–2, 40 FR 60049, Dec. 31, 1975, as
amended by T.D. 86–118, 51 FR 22515, June 20,
1986]

§ 10.178 Direct costs of processing operations performed in the beneficiary developing country.
(a) Items included in the direct costs of
processing operations. As used in § 10.176,
the words ‘‘direct costs of processing
operations’’ means those costs either
directly incurred in, or which can be
reasonably allocated to, the growth,
production, manufacture, or assembly
of the specific merchandise under consideration. Such costs include, but are
not limited to:
(1) All actual labor costs involved in
the growth, production, manufacture,
or assembly of the specific merchandise, including fringe benefits, on-thejob training, and the cost of engineering, supervisory, quality control, and
similar personnel;
(2) Dies, molds, tooling, and depreciation on machinery and equipment
which are allocable to the specific merchandise;
(3) Research, development, design,
engineering, and blueprint costs insofar as they are allocable to the specific
merchandise; and
(4) Costs of inspecting and testing the
specific merchandise.
(b) Items not included in the direct costs
of processing operations. Those items
which are not included within the
meaning of the words ‘‘direct costs of
processing operations’’ are those which
are not directly attributable to the
merchandise under consideration or are
not ‘‘costs’’ of manufacturing the product. These include, but are not limited
to:

§ 10.178a

(1) Profit; and
(2) General expenses of doing business
which are either not allocable to the
specific merchandise or are not related
to the growth, production, manufacture, or assembly of the merchandise,
such as administrative salaries, casualty and liability insurance, advertising, and salesmen’s salaries, commissions, or expenses.
[T.D. 76–2, 40 FR 60049, Dec. 31, 1975]

§ 10.178a Special duty-free treatment
for sub-Saharan African countries.
(a) General. Section 506A of the Trade
Act of 1974 (19 U.S.C. 2466a) authorizes
the President to provide duty-free
treatment for certain articles otherwise excluded from duty-free treatment under the Generalized System of
Preferences (GSP) pursuant to section
503(b)(1)(B) through (G) of the Trade
Act of 1974 (19 U.S.C. 2463(b)(1)(B)
through (G)) and authorizes the President to designate a country listed in
section 107 of the African Growth and
Opportunity Act (19 U.S.C. 3706) as an
eligible beneficiary sub-Saharan African country for purposes of that dutyfree treatment.
(b) Eligible articles. The duty-free
treatment referred to in paragraph (a)
of this section will apply to any article
within any of the following classes of
articles, provided that the article in
question has been designated by the
President for that purpose and is the
growth, product, or manufacture of an
eligible beneficiary sub-Saharan African country and meets the requirements specified or referred to in paragraph (d) of this section:
(1) Watches, except those watches entered after June 30, 1989, that the President specifically determines, after public notice and comment, will not cause
material injury to watch or watch
band, strap, or bracelet manufacturing
and assembly operations in the United
States or the United States insular
possessions;
(2) Certain electronic articles;
(3) Certain steel articles;
(4) Footwear, handbags, luggage, flat
goods, work gloves, and leather wearing apparel which were not eligible articles for purposes of the GSP on January 1, 1995, as the GSP was in effect on
that date;

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§ 10.178a

19 CFR Ch. I (4–1–11 Edition)

(5) Certain semimanufactured and
manufactured glass products; and
(6) Any other articles which the
President determines to be import-sensitive in the context of the GSP.
(c) Claim for duty-free treatment. A
claim for the duty-free treatment referred to in paragraph (a) of this section must be made by placing on the
entry document the symbol ‘‘D’’ as a
prefix to the subheading of the Harmonized Tariff Schedule of the United
States for each article for which dutyfree treatment is claimed;
(d) Origin and related rules. The provisions of §§ 10.171, 10.173, and 10.175
through 10.178 will apply for purposes
of duty-free treatment under this section. However, application of those provisions in the context of this section
will be subject to the following rules:
(1) The term ‘‘beneficiary developing
country,’’ wherever it appears, means
‘‘beneficiary sub-Saharan African country;’
(2) In the GSP declaration set forth
in § 10.173(a)(1)(i), the column heading
‘‘Materials produced in a beneficiary
developing country or members of the
same association’’ should read ‘‘Material produced in a beneficiary sub-Saharan African country or in the U.S.;’’
(3) The provisions of § 10.175(c) will
not apply; and
(4) For purposes of determining compliance with the 35 percent value content requirement set forth in § 10.176(a):
(i) An amount not to exceed 15 percent of the appraised value of the article at the time it is entered may be attributed to the cost or value of materials produced in the customs territory
of the United States, and the provisions of § 10.177 will apply for purposes
of identifying materials produced in
the customs territory of the United
States and the cost or value of those
materials; and
(ii) The cost or value of materials included in the article that are produced
in more than one beneficiary sub-Saharan African country may be applied
without regard to whether those countries are members of the same association of countries.
(e) Importer requirements. In order to
make a claim for duty-free treatment
under this section, the importer:

(1) Must have records that explain
how the importer came to the conclusion that the article qualifies for dutyfree treatment;
(2) Must have records that demonstrate that the importer is claiming
that the article qualifies for duty-free
treatment because it is the growth of a
beneficiary sub-Saharan African country or because it is the product of a
beneficiary sub-Saharan African country or because it is the manufacture of
a beneficiary sub-Saharan African
country. If the importer is claiming
that the article is the growth of a beneficiary sub-Saharan African country,
the importer must have records that
indicate that the product was grown in
that country, such as a record of receipt from a farmer whose crops are
grown in that country. If the importer
is claiming that the article is the product of, or the manufacture of, a beneficiary sub-Saharan African country,
the importer must have records that
indicate that the manufacturing or
processing operations reflected in or
applied to the article meet the country
of origin rules set forth in § 10.176(a)
and paragraph (d) of this section. A
properly completed GSP declaration in
the form set forth in § 10.173(a)(1) is one
example of a record that would serve
this purpose;
(3) Must establish and implement internal controls which provide for the
periodic review of the accuracy of the
declarations or other records referred
to in paragraph (e)(2) of this section;
(4) Must have shipping papers that
show how the article moved from the
beneficiary sub-Saharan African country to the United States. If the imported article was shipped through a
country other than a beneficiary subSaharan African country and the invoices and other documents from the
beneficiary sub-Saharan African country do not show the United States as
the final destination, the importer also
must have documentation that demonstrates that the conditions set forth
in § 10.175(d)(1) through (3) were met;
(5) Must have records that demonstrate the cost or value of the materials produced in the United States and

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U.S. Customs and Border Protection, DHS; Treasury
the cost or value of the materials produced in a beneficiary sub-Saharan African country or countries and the direct costs of processing operations incurred in the beneficiary sub-Saharan
African country that were relied upon
by the importer to determine that the
article met the 35 percent value content requirement set forth in § 10.176(a)
and paragraph (c) of this section. A
properly completed GSP declaration in
the form set forth in § 10.173(a)(1) is one
example of a record that would serve
this purpose; and
(6) Must be prepared to produce the
records referred to in paragraphs (e)(1),
(e)(2), (e)(4), and (e)(5) of this section
within 30 days of a request from Customs and must be prepared to explain
how those records and the internal controls referred to in paragraph (e)(3) of
this section justify the importer’s
claim for duty-free treatment.

§ 10.180

(1) Liquidated or reliquidated entries
if the required certification is filed
with the director of the port where the
original entry was made on or before
the 180th day after the date of entry;
and
(2) Articles entered, or withdrawn
from warehouse, for consumption, pursuant to a commercial exchange agreement.
(c) Verification of the quantities of
crude petroleum exported to or imported from Canada under such a commercial exchange agreement shall be
made in accordance with import
verification provided in Part 151, Subpart C, Customs Regulations (19 CFR
part 151, subpart C).
[T.D. 81–292, 46 FR 58069, Nov. 30, 1981, as
amended by T.D. 89–1, 53 FR 51252, Dec. 21,
1988; T.D. 91–82, 56 FR 49845, Oct. 2, 1991]

CERTAIN FRESH, CHILLED, OR FROZEN
BEEF

[T.D. 00–67, 65 FR 59675, Oct. 5, 2000]

CANADIAN CRUDE PETROLEUM
§ 10.179 Canadian crude petroleum
subject to a commercial exchange
agreement between United States
and Canadian refiners.
(a) Crude petroleum (as defined in
Chapter 27, Additional U.S. Note 1,
Harmonized Tariff Schedule of the
United States (19 U.S.C. 1202)) produced
in Canada may be admitted free of duty
if the entry is accompanied by a certificate from the importer establishing
that:
(1) The petroleum is imported pursuant to a commercial exchange agreement between United States and Canadian refiners which has been approved
by the Secretary of Energy;
(2) An equivalent amount of domestic
or duty-paid foreign crude petroleum
on which the importer has executed a
written waiver of drawback, has been
exported to Canada pursuant to the export license and previously has not
been used to effect the duty-free entry
of like Canadian products; and,
(3) An export license has been issued
by the Secretary of Commerce for the
petroleum which has been exported to
Canada.
(b) The provisions of this section may
be applied to:

§ 10.180 Certification.
(a) The foreign official’s meat-inspection certificate required by U.S. Department of Agriculture regulations (9
CFR 327.4) shall be modified to include
the certification below when fresh,
chilled, or frozen beef is to be entered
under the provisions of subheadings
0201.20.10, 0201.30.02, 0202.20.02, 0202.20.10,
Harmonized Tariff Schedule of the
United States (HTSUS). The certification shall be made, prior to exportation of the beef, by an official of the
government of the exporting country
and filed with Customs with the entry
summary or with the entry when the
entry summary is filed at the time of
entry. The requirements of this section
shall be in addition to those requirements contained in 9 CFR 327.4. Appropriate officials of the exporting country should consult with the U.S. Department of Agriculture as to the beef
grades or standards within their country that satisfy the certification requirement. Exporters or importers of
beef to be entered under the provisions
of subheadings 0201.20.10, 0201.30.02,
0202.20.02, 0202.20.10, HTSUS, should
consult with the U.S. Department of
Agriculture prior to exportation in
order to insure that the beef will satisfy the certification requirements.
This certification is relevant only to

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§§ 10.181–10.182

19 CFR Ch. I (4–1–11 Edition)

U.S. Customs tariff classification and
is not applicable to marketing of beef
under U.S. Department of Agriculture
grading standards, a matter within
U.S. Department of Agriculture’s jurisdiction.
CERTIFICATION
I hereby certify to the best of my knowledge and belief that the herein described
fresh, chilled, or frozen beef, meets the specifications prescribed in regulations issued by
the U.S. Department of Agriculture (7 CFR
2853.106 (a) and (b)).

(b) Appropriate officials of the following countries have agreed with the
U.S. Department of Agriculture as to
the grades or standards for fresh,
chilled, or frozen beef within their respective countries which will satisfy
the certification requirements of paragraph (a) of this section: Canada.
[T.D. 82–8, 47 FR 945, Jan. 8, 1982, as amended
by T.D. 89–1, 53 FR 51252, Dec. 21, 1988; T.D.
97–82, 62 FR 51769, Oct. 3, 1997]

WATCHES AND WATCH MOVEMENTS FROM
U.S. INSULAR POSSESSIONS
§§ 10.181–10.182

[Reserved]

CIVIL AIRCRAFT
§ 10.183 Duty-free entry of civil aircraft, aircraft engines, ground flight
simulators, parts, components, and
subassemblies.
(a) Applicability. Except as provided
in paragraph (b) of this section, this
section applies to aircraft, aircraft engines, and ground flight simulators, including their parts, components, and
subassemblies, that qualify as civil aircraft under General Note 6(b) ofthe
Harmonized Tariff Schedule of the
United States (HTSUS) by meeting the
following requirements:
(1) The aircraft, aircraft engines,
ground flight simulators, or their
parts, components, and subassemblies,
are used as original or replacement
equipment in the design, development,
testing, evaluation, manufacture, repair, maintenance, rebuilding, modification, or conversion of aircraft; and
(2) They are either:
(i) Manufactured or operated pursuant to a certificate issued by the Administrator of the Federal Aviation
Administration (FAA) under 49 U.S.C.
44704 or pursuant to the approval of the

airworthiness authority in the country
of exportation, if that approval is recognized by the FAA as an acceptable
substitute for the FAA certificate;
(ii) Covered by an application for
such certificate, submitted to and accepted by the FAA, filed by an existing
type and production certificate holder
pursuant to 49 U.S.C. 44702 and implementing regulations (Federal Aviation
Administration Regulations, title 14,
Code of Federal Regulations); or
(iii) Covered by an application for
such approval or certificate which will
be submitted in the future by an existing type and production certificate
holder, pending the completion of design or other technical requirements
stipulated by the FAA (applicable only
to the quantities of parts, components,
and subassemblies as are required to
meet the stipulation).
(b) Department of Defense or U.S. Coast
Guard use. If purchased for use by the
Department of Defense or the United
States Coast Guard, aircraft, aircraft
engines, and ground flight simulators,
including their parts, components, and
subassemblies, are subject to this section only if they are used as original or
replacement equipment in the design,
development, testing, evaluation, manufacture, repair, maintenance, rebuilding, modification, or conversion of aircraft and meet the requirements of either paragraph (a)(2)(i) or (a)(2)(ii) of
this section.
(c) Claim for admission free of duty.
Merchandise qualifying under paragraph (a) or paragraph (b) of this section is entitled to duty-free admission
in accordance with General Note 6,
HTSUS, upon meeting the requirements of this section. An importer will
make a claim for duty-free admission
under this section and General Note 6,
HTSUS, by properly entering qualifying merchandise under a provision
for which the rate of duty ‘‘Free (C)’’
appears in the ‘‘Special’’ subcolumn of
the HTSUS and by placing the special
indicator ‘‘C’’ on the entry summary.
The fact that qualifying merchandise
has previously been exported with benefit of drawback does not preclude free
entry under this section.
(d) Importer certification. In making a
claim for duty-free admission as provided for under paragraph (c) of this

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U.S. Customs and Border Protection, DHS; Treasury
section, the importer is deemed to certify, in accordance with General Note
6(a)(ii), HTSUS, that the imported merchandise is, as described in paragraph
(a) or paragraph (b) of this section, a
civil aircraft or has been imported for
use in a civil aircraft and will be so
used.
(e) Documentation. Each entry summary claiming duty-free admission for
imported merchandise in accordance
with paragraph (c) of this section must
be supported by documentation to
verify the claim for duty-free admission, including the written order or
contract and other evidence that the
merchandise entered qualifies under
General Note 6, HTSUS, as a civil aircraft, aircraft engine, or ground flight
simulator, or their parts, components,
and subassemblies. Evidence that the
merchandise qualifies under the general note includes evidence of compliance with paragraph (a)(1) of this section concerning use of the merchandise
and evidence of compliance with the
airworthiness certification requirement of paragraph (a)(2)(i), (a)(2)(ii), or
(a)(2)(iii) of this section, including, as
appropriate in the circumstances, an
FAA certification; approval of airworthiness by an airworthiness authority in the country of export and evidence that the FAA recognizes that approval as an acceptable substitute for
an FAA certification; an application
for a certification submitted to and accepted by the FAA; a type and production certificate issued by the FAA; and/
or evidence that a type and production
certificate holder will submit an application for certification or approval in
the future pending completion of design or other technical requirements
stipulated by the FAA and of estimates
of quantities of parts, components, and
subassemblies as are required to meet
design and technical requirements stipulated by the FAA. This documentation need not be filed with the entry
summary but must be maintained in
accordance with the general note and
with the recordkeeping provisions of
part 163 of this chapter. Customs may
request production of documentation
at any time to verify the claim for
duty-free admission. Failure to produce
documentation sufficient to satisfy the
port director that the merchandise

§ 10.191

qualifies for duty-free admission will
result in a denial of duty-free treatment and may result in such other
measures permitted under the regulations as the port director finds necessary to more closely monitor the importer’s importations of merchandise
claimed to be duty-free under this section. Proof of end use of the entered
merchandise need not be maintained.
(f) Post-entry claim. An importer may
file a claim for duty-free treatment
under General Note 6, HTSUS, after filing an entry that made no such dutyfree claim, by filing a written statement with Customs any time prior to
liquidation of the entry or prior to the
liquidation becoming final. When filed,
the written statement constitutes the
importer=s claim for duty-free treatment under the general note and its
certification that the entered merchandise is a civil aircraft or has been imported for use in a civil aircraft and
will be so used. In accordance with
General Note 6, HTSUS, any refund resulting from a claim made under this
paragraph will be without interest,
notwithstanding the provision of 19
U.S.C. 1505(c).
(g) Verification. The port director will
monitor and periodically audit selected
entries made under this section.
[T.D. 02–31, 67 FR 39289, June 7, 2002]

Subpart B—Caribbean Basin
Initiative
SOURCE: Sections 10.191 through 10.197
issued by T.D. 84–237, 49 FR 47993, Dec. 7, 1984,
unless otherwise noted.

§ 10.191

General.

(a) Statutory authority. Subtitle A,
Title II, Pub. L. 98–67, entitled the Caribbean Basin Economic Recovery Act
(19 U.S.C. 2701–2706) and referred to as
the Caribbean Basin Initiative (CBI),
authorizes the President to proclaim
duty-free treatment for all eligible articles from any beneficiary country.
(b) Definitions—(1) Beneficiary country. For purposes of § 10.191 through
§ 10.199 and except as otherwise provided in § 10.195(b), the term ‘‘beneficiary country’’ means any country or
territory or successor political entity
with respect to which there is in effect

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§ 10.192

19 CFR Ch. I (4–1–11 Edition)

a proclamation by the President designating such country, territory or successor political entity as a beneficiary
country in accordance with section
212(a)(1)(A) of the Caribbean Basin Economic
Recovery
Act
(19
U.S.C.
2702(a)(1)(A)). See General Note 7(a),
Harmonized Tariff Schedule of the
United States (HTSUS). For purposes
of this paragraph, when the word
‘‘former’’ is used in conjunction with
the term ‘‘beneficiary country’’, it
means a country that ceases to be designated as a beneficiary country under
the CBERA because the country has
become a party to a free trade agreement with the United States. See General Note 7(b)(i)(C), HTSUS.
(2) Eligible articles. Except as provided
herein, for purposes of § 10.191(a), the
term ‘‘eligible articles’’ means any merchandise which is imported directly
from a beneficiary country as provided
in § 10.193 and which meets the country
of origin criteria set forth in § 10.195 or
in § 10.198b. The following merchandise
shall not be considered eligible articles
entitled to duty-free treatment under
the CBI.
(i) Textile and apparel articles which
were not eligible articles for purposes
of the CBI on January 1, 1994, as the
CBI was in effect on that date.
(ii) Footwear not designated on August 5, 1983, as eligible articles for the
purpose of the Generalized System of
Preferences under Title V, Trade Act of
1974, as amended (19 U.S.C. 2461 through
2467).
(iii) Tuna, prepared or preserved in
any manner, in airtight containers.
(iv) Petroleum, or any product derived from petroleum, provided for in
headings 2709 and 2710, HTSUS.
(v) Watches and watch parts (including cases, bracelets and straps), of
whatever type including, but not limited to, mechanical, quartz digital or
quartz analog, if such watches or watch
parts contain any material which is
the product of any country with respect to which HTSUS column 2 rates
of duty apply.
(vi) Articles to which reduced rates
of duty apply under § 10.198a.
(vii) Sugars, sirups, and molasses,
provided for in subheadings 1701.11.00
and 1701.12.00, HTSUS, to the extent
that importation and duty-free treat-

ment of such articles are limited by
Additional U.S. Note 4, Chapter 17,
HTSUS.
(viii) Articles subject to the provisions of the subheadings of Subchapter
III, from the beginning through
9903.85.21, Chapter 99, HTSUS, to the
extent that such provisions have not
been modified or terminated by the
President pursuant to section 213(e)(5)
of the Caribbean Basin Economic Recovery Act (19 U.S.C. 2703(e)(5)).
(ix) Merchandise for which duty-free
treatment under the CBI is suspended
or withdrawn by the President pursuant to sections 213 (c)(2), (e)(1), or (f)(3)
of the Caribbean Basin Economic Recovery Act (19 U.S.C. 2703 (c)(2), (e)(1),
or (f)(3)).
(3) Wholly the growth, product, or manufacture of a beneficiary country. For
purposes of § 10.191 through § 10.199, the
expression ‘‘wholly the growth, product, or manufacture of a beneficiary
country’’ refers both to any article
which has been entirely grown, produced, or manufactured in a beneficiary country or two or more beneficiary countries and to all materials
incorporated in an article which have
been entirely grown, produced, or manufactured in any beneficiary country or
two or more beneficary countries, as
distinguished from articles or materials imported into a beneficiary country from a non-beneficiary country
whether or not such articles or materials were substantially transformed
into new or different articles of commerce after their importation into the
beneficiary country.
(4) Entered. For purposes of § 10.191
through § 10.199, the term ‘‘entered’’
means entered, or withdrawn from
warehouse for consumption, in the customs territory of the U.S.
[T.D. 84–237, 49 FR 47993, Dec. 7, 1984, as
amended by T.D. 89–1, 53 FR 51252, Dec. 21,
1988; T.D. 00–68, 65 FR 59657, Oct. 5, 2000; T.D.
01–17, 66 FR 9645, Feb. 9, 2001; CBP Dec. 10–29,
75 FR 52450, Aug. 26, 2010]

§ 10.192 Claim for exemption from
duty under the CBI.
A claim for an exemption from duty
on the ground that the CBI applies
shall be allowed by the port director
only if he is satisfied that the requirements set forth in this section and

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U.S. Customs and Border Protection, DHS; Treasury
§ 10.193 through § 10.198b have been met.
Duty-free treatment may be claimed at
the time of filing the entry summary
by placing the symbol ‘‘E’’ as a prefix to
the HTSUS subheading number for
each article for which such treatment
is claimed on that document.
[T.D. 84–237, 49 FR 47993, Dec. 7, 1984, as
amended by T.D. 89–1, 53 FR 51252, Dec. 21,
1988; T.D. 94–47, 59 FR 25570, May 17, 1994;
T.D. 00–68, 65 FR 59658, Oct. 5, 2000]

§ 10.193 Imported directly.
To qualify for treatment under the
CBI, an article shall be imported directly from a beneficiary country into
the customs territory of the U.S. For
purposes of § 10.191 through § 10.198b the
words ‘‘imported directly’’ mean:
(a) Direct shipment from any beneficiary country to the U.S. without
passing through the territory of any
non-beneficiary country; or
(b) If the shipment is from any beneficiary country to the U.S. through the
territory of any non-beneficiary country, the articles in the shipment do not
enter into the commerce of any nonbeneficiary country while en route to
the U.S. and the invoices, bills of lading, and other shipping documents
show the U.S. as the final destination;
or
(c) If the shipment is from any beneficiary country to the U.S. through the
territory of any non-beneficiary country, and the invoices and other documents do not show the U.S. as the final
destination, the articles in the shipment upon arrival in the U.S. are imported directly only if they:
(1) Remained under the control of the
customs authority of the intermediate
country;
(2) Did not enter into the commerce
of the intermediate country except for
the purpose of sale other than at retail,
and the port director is satisfied that
the importation results from the original commericial transaction between
the importer and the producer or the
latter’s sales agent; and
(3) Were not subjected to operations
other than loading and unloading, and
other activities necessary to preserve
the articles in good condition.
[T.D. 84–237, 49 FR 47993, Dec. 7, 1984, as
amended by T.D. 00–68, 65 FR 59658, Oct. 5,
2000]

§ 10.195

§ 10.194 Evidence of direct shipment.
(a) Documents constituting evidence of
direct shipment. The port director may
require that appropriate shipping papers, invoices, or other documents be
submitted within 60 days of the date of
entry as evidence that the articles
were ‘‘imported directly’’, as that term
is defined in § 10.193. Any evidence of direct shipment required shall be subject
to such verification as deemed necessary by the port director.
(b) Waiver of evidence of direct shipment. The port director may waive the
submission of evidence of direct shipment when otherwise satisfied, taking
into consideration the kind and value
of the merchandise, that the merchandise was, in fact, imported directly and
that it otherwise clearly qualifies for
treatment under the CBI.
§ 10.195 Country of origin criteria.
(a) Articles produced in a beneficiary
country—(1) General. Except as provided
herein, any article which is either
wholly the growth, product, or manufacture of a beneficiary country or a
new or different article of commerce
which has been grown, produced, or
manufactured in a beneficiary country,
may qualify for duty-free entry under
the CBI. No article or material shall be
considered to have been grown, produced, or manufactured in a beneficiary country by virtue of having
merely undergone simple (as opposed
to complex or meaningful) combining
or packaging operations, or mere dilution with water or mere dilution with
another substance that does not materially alter the characteristics of the
article. Duty-free entry under the CBI
may be accorded to an article only if
the sum of the cost or value of the material produced in a beneficiary country or countries, plus the direct costs
of processing operations performed in a
beneficiary country or countries, is not
less than 35 percent of the appraised
value of the article at the time it is entered.
(2) Combining, packaging, and diluting
operations. No article which has undergone only a simple combining or packaging operation or a mere dilution in a
beneficiary country within the meaning of paragraph (a)(1) of this section
shall be entitled to duty-free treatment

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§ 10.195

19 CFR Ch. I (4–1–11 Edition)

even though the processing operation
causes the article to meet the value requirement set forth in that paragraph.
(i) For purposes of this section, simple combining or packaging operations
and mere dilution include, but are not
limited to, the following processes:
(A) The addition of batteries to devices;
(B) Fitting together a small number
of components by bolting, glueing, soldering etc.;
(C) Blending foreign and beneficiary
country tobacco;
(D) The addition of substances such
as anticaking agents, preservatives,
wetting agents, etc.;
(E) Repacking or packaging components together;
(F) Reconstituting orange juice by
adding water to orange juice concentrate; and
(G) Diluting chemicals with inert ingredients to bring them to standard degrees of strength.
(ii) For purposes of this section, simple combining or packaging operations
and mere dilution shall not be taken to
include processes such as the following:
(A) The assembly of a large number
of discrete components onto a printed
circuit board;
(B) The mixing together of two bulk
medicinal substances followed by the
packaging of the mixed product into
individual doses for retail sale;
(C) The addition of water or another
substance to a chemical compound
under pressure which results in a reaction creating a new chemical compound; and
(D) A simple combining or packaging
operation or mere dilution coupled
with any other type of processing such
as testing or fabrication (e.g., a simple
assembly of a small number of components, one of which was fabricated in
the beneficiary country where the assembly took place).
The fact that an article or material has
undergone more than a simple combining or packaging operation or mere
dilution is not necessarily dispositive
of the question of whether that processing constitutes a substantial transformation for purposes of determining
the country of origin of the article or
material.

(b) Commonwealth of Puerto Rico, U.S.
Virgin Islands, and former beneficiary
countries—(1) General. For purposes of
determining the percentage referred to
in paragraph (a) of this section, the
term ‘‘beneficiary country’’ includes the
Commonwealth of Puerto Rico, U.S.
Virgin Islands, and any former beneficiary countries. Any cost or value of
materials or direct costs of processing
operations attributable to the U.S. Virgin Islands or any former beneficiary
country must be included in the article
prior to its final exportation from a
beneficiary country to the United
States.
(2) Manufacture in the Commonwealth
of Puerto Rico after final exportation.
Notwithstanding the provisions of 19
U.S.C. 1311, if an article from a beneficiary country is entered under bond
for processing or use in manufacturing
in the Commonwealth of Puerto Rico,
no duty will be imposed on the withdrawal from warehouse for consumption of the product of that processing
or manufacturing provided that:
(i) The article entered in the warehouse in the Commonwealth of Puerto
Rico was grown, produced, or manufactured in a beneficiary country within
the meaning of paragraph (a) of this
section and was imported directly from
a beneficiary country within the meaning of § 10.193; and
(ii) At the time of its withdrawal
from the warehouse, the product of the
processing or manufacturing in the
Commonwealth of Puerto Rico meets
the 35 percent value-content requirement prescribed in paragraph (a) of
this section.
(c) Materials produced in the U.S. For
purposes of determining the percentage
referred to in paragraph (a) of this section, an amount not to exceed 15 percent of the appraised value of the article at the time it is entered may be attributed to the cost or value of materials produced in the customs territory
of the U.S. (other than the Commonwealth of Puerto Rico). In the case of
materials produced in the customs territory of the U.S., the provisions of
§ 10.196 shall apply.
(d) Textile components cut to shape in
the U.S. The percentage referred to in
paragraph (c) of this section may be attributed in whole or in part to the cost

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U.S. Customs and Border Protection, DHS; Treasury
or value of a textile component that is
cut to shape (but not to length, width,
or both) in the U.S. (including the
Commonwealth of Puerto Rico) from
foreign fabric and exported to a beneficiary country for assembly into an
article that is then returned to the
U.S. and entered, or withdrawn from
warehouse, for consumption on or after
July 1, 1996. For purposes of this paragraph, the terms ‘‘textile component’’
and ‘‘fabric’’ have reference only to
goods covered by the definition of
‘‘textile or apparel product’’ set forth in
§ 102.21(b)(5) of this chapter.
(e) Articles wholly grown, produced, or
manufactured in a beneficiary country.
Any article which is wholly the
growth, product, or manufacture of a
beneficiary country, including articles
produced or manufactured in a beneficiary country exclusively from materials which are wholly the growth,
product, or manufacture of a beneficiary country or countries, shall normally be presumed to meet the requirements set forth in paragraph (a) of this
section.
(f) Country of origin marking. The general country of origin marking requirements that apply to all importations
are also applicable to articles imported
under the CBI.
[T.D. 84–237, 49 FR 47993, Dec. 7, 1984; 49 FR
49575, Dec. 20, 1984, as amended by T.D. 95–69,
60 FR 46197, Sept. 5, 1995; T.D. 95–69, 60 FR
55995, Nov. 6, 1996; T.D. 00–68, 65 FR 59658,
Oct. 5, 2000; CBP Dec. 10–29, 75 FR 52450, Aug.
26, 2010]

§ 10.196 Cost or value of materials produced in a beneficiary country or
countries.
(a) ‘‘Materials produced in a beneficiary
country or countries’’ defined. For purposes of § 10.195, the words ‘‘materials
produced in a beneficiary country or
countries’’ refer to those materials incorporated in an article which are either:
(1) Wholly the growth, product, or
manufacture of a beneficiary country
or two or more beneficiary countries;
or
(2) Subject to the limitations set
forth in § 10.195(a), substantially transformed in any beneficiary country or
two or more beneficiary countries into
a new or different article of commerce

§ 10.196

which is then used in any beneficiary
country in the production or manufacture of a new or different article which
is imported directly into the U.S.
Example 1. A raw, perishable skin of an animal grown in one beneficiary country is sent
to another beneficiary country where it is
tanned to create nonperishable ‘‘crust leather’’. The tanned product is then imported directly into the U.S. Because the material of
which the imported article is composed is
wholly the growth, product, or manufacture
of one of more beneficiary countries, the entire cost or value of that material may be
counted toward the 35 percent value requirement set forth in § 10.195.
Example 2. A raw, perishable skin of an animal grown in a non-beneficiary country is
sent to a beneficiary country where it is
tanned to create nonperishable ‘‘crust leather’’. The tanned skin is then imported directly into the U.S. Although the tanned
skin represents a new or different article of
commerce produced in a beneficiary country
within the meaning of § 10.195(a), the cost or
value of the raw skin may not be counted toward the 35 percent value requirement because (1) the tanned material of which the
imported article is composed is not wholly
the growth, product, or manufacture of a
beneficiary country and (2) the tanning operation creates the imported article itself
rather than an intermediate article which is
then used in the beneficiary country in the
production or manufacture of an article imported into the U.S. The tanned skin would
be eligible for duty-free treatment only if
the direct costs attributable to the tanning
operation represent at least 35 percent of the
appraised value of the imported article.
Example 3. A raw, perishable skin of an animal grown in a non-beneficiary country is
sent to a beneficiary country where it is
tanned to create nonperishable ‘‘crust leather’’. The tanned material is then cut, sewn
and assembled with a metal buckle imported
from a non-beneficiary country to create a
finished belt which is imported directly into
the U.S. Because the operations performed in
the beneficiary country involved both the
substantial transformation of the raw skin
into a new or different article and the use of
that intermediate article in the production
or manufacture of a new or different article
imported into the U.S., the cost or value of
the tanned material used to make the imported article may be counted toward the 35
percent value requirement. The cost or value
of the metal buckle imported into the beneficiary country may not be counted toward
the 35 percent value requirement because the
buckle was not substantially transformed in
the beneficiary country into a new or different article prior to its incorporation in
the finished belt.

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§ 10.197

19 CFR Ch. I (4–1–11 Edition)

Example 4. A raw, perishable skin of an animal grown in the U.S. Virgin Islands is sent
to a beneficiary country where it is tanned
to create nonperishable ‘‘crust leather’’,
which is then imported directly into the U.S.
The tanned skin represents a new or different article of commerce produced in a
beneficiary country within the meaning of
§ 10.195(a), and under § 10.195(b), the raw skin
from which the tanned product was made is
considered to have been grown in a beneficiary country for the purpose of applying
the 35 percent value requirement. The
tanned material of which the imported article is composed is considered to be wholly
the growth, product, or manufacture of one
or more beneficiary countries with the result
that the entire cost or value of that material
may be counted toward the 35 percent value
requirement.

(b) Questionable origin. When the origin of a material either is not ascertainable or is not satisfactorily demonstrated to the port director, the material shall not be considered to have
been grown, produced, or manufactured
in a beneficiary country.
(c) Determination of cost or value of
materials produced in a beneficiary country. (1) The cost or value of materials
produced in a beneficiary country or
countries includes:
(i) The manufacturer’s actual cost for
the materials;
(ii) When not included in the manufacturer’s actual cost for the materials,
the freight, insurance, packing, and all
other costs incurred in transporting
the materials to the manufacturer’s
plant;
(iii) The actual cost of waste or spoilage (material list), less the value of recoverable scrap; and
(iv) Taxes and/or duties imposed on
the materials by any beneficiary country, provided they are not remitted
upon exportation.
(2) Where a material is provided to
the manufacturer without charge, or at
less than fair market value, its cost or
value shall be determined by computing the sum of:
(i) All expenses incurred in the
growth, production, or manufacture of
the material, including general expenses;
(ii) An amount for profit; and
(iii) Freight, insurance, packing, and
all other costs incurred in transporting
the material to the manufacturer’s
plant.

If the pertinent information needed to
compute the cost or value of a material
is not available, the appraising officer
may ascertain or estimate the value
thereof using all reasonable ways and
means at his disposal.
§ 10.197 Direct costs of processing operations performed in a beneficiary
country or countries.
(a) Items included in the direct costs of
processing operations. As used in § 10.195
and § 10.198, the words ‘‘direct costs of
processing operations’’ mean those
costs either directly incurred in, or
which can be reasonably allocated to,
the growth, production, manufacture,
or assembly of the specific merchandise under consideration. Such costs
include, but are not limited to the following, to the extent that they are includable in the appraised value of the
imported merchandise:
(1) All actual labor costs involved in
the growth, production, manufacture
or assembly of the specific merchandise, including fringe benefits, on-thejob training, and the cost of engineering, supervisory, quality control, and
similar personnel;
(2) Dies, molds, tooling, and depreciation on machinery and equipment
which are allocable to the specific merchandise;
(3) Research, development, design,
engineering, and blueprint costs insofar as they are allocable to the specific
merchandise and;
(4) Costs of inspecting and testing the
specific merchandise.
(b) Items not included in the direct costs
of processing operations. Those items
which are not included within the
meaning of the words ‘‘direct costs of
processing operations’’ are those which
are not directly attributable to the
merchandise under consideration or are
not ‘‘costs’’ of manufacturing the product. These include, but are not limited
to:
(1) Profit; and
(2) General expenses of doing business
which are either not allocable to the
specific merchandise or are not related
to the growth, production, manufacture, or assembly of the merchandise,

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U.S. Customs and Border Protection, DHS; Treasury
such as administrative salaries, casualty and liability insurance, advertising, and salesmen’s salaries, commissions, or expenses.
[T.D. 84–237, 49 FR 47993, Dec. 7, 1984; 49 FR
49575, Dec. 20, 1984]

§ 10.198

ting forth all pertinent detailed information concerning the production or
manufacture of the article. When requested by the port director, the declaration shall be prepared in substantially the following form:
CBI DECLARATION

§ 10.198

Evidence of country of origin.

(a) Shipments covered by a formal
entry—(1) Articles not wholly the growth,
product, or manufacture of a beneficiary
country—(i) Declaration. In a case involving an article covered by a formal
entry which is not wholly the growth,
product, or manufacture of a single
beneficiary country, the exporter or
other appropriate party having knowledge of the relevant facts in the beneficiary country where the article was
produced or last processed shall be prepared to submit directly to the port director, upon request, a declaration set-

I, llllllllllllll,
(name), hereby declare that the articles described below (a) were produced or manufactured in llllllll (country) by means
of processing operations performed in that
country as set forth below and were also subjected to processing operations in the other
beneficiary country or countries (including
the Commonwealth of Puerto Rico and the
U.S. Virgin Islands) as set forth below and
(b) incorporate materials produced in the
country named above or in any other beneficiary country or countries (including the
Commonwealth of Puerto Rico and the U.S.
Virgin Islands) or in the customs territory of
the United States (other than the Commonwealth of Puerto Rico) as set forth below:
Processing operations performed on articles

Number and date of invoices

Description of
articles and
quantity

Description of
processing operations and
country of
processing

Date lllllllllllllllllllll
Address lllllllllllllllllll
Signature llllllllllllllllll
Title lllllllllllllllllllll

(ii) Retention of records and submission
of declaration. The information necessary for preparation of the declaration shall be retained in the files of the
party responsible for its preparation
and submission for a period of 5 years.
In the event that the port director requests submission of the declaration
during the 5-year period, it shall be
submitted by the appropriate party directly to the port director within 60
days of the date of the request or such
additional period as the port director
may allow for good cause shown. Failure to submit the declaration in a
timely fashion will result in a denial of
duty-free treatment.
(iii) Value added after final exportation. In a case in which value is added

Direct costs of
processing operations

Material produced in a beneficiary country or in the U.S.
Description of
material, production process, and country of production

Cost or value
of material

to an article in a bonded warehouse or
in a foreign-trade zone in the Commonwealth of Puerto Rico or in the U.S.
after final exportation of the article
from a beneficiary country, in order to
ensure compliance with the value requirement under § 10.195(a), the declaration provided for in paragraph (a)(1)(i)
of this section shall be filed by the importer or consignee with the entry
summary as evidence of the country of
origin. The declaration shall be properly completed by the party responsible for the addition of such value.
(2) Merchandise wholly the growth,
product, or manufacture of a beneficiary
country. In a case involving merchandise covered by a formal entry which is
wholly the growth, product, or manufacture of a single beneficiary country,
a statement to that effect shall be included on the commercial invoice provided to Customs.

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§ 10.198a

19 CFR Ch. I (4–1–11 Edition)

(b) Shipments covered by an informal
entry. Although the filing of the declaration provided for in paragraph
(a)(1)(i) of this section will not be required for a shipment covered by an informal entry, the port director may require such other evidence of country of
origin as deemed necessary.
(c) Verification of documentation. Any
evidence of country of origin submitted
under this section shall be subject to
such verification as the port director
deems necessary. In the event that the
port director is prevented from obtaining the necessary verification, the port
director may treat the entry as dutiable.
[T.D. 94–47, 59 FR 25570, May 17, 1994]

§ 10.198a Duty reduction for certain
leather-related articles.
Except as otherwise provided in
§ 10.233, reduced rates of duty as proclaimed by the President will apply to
handbags, luggage, flat goods, work
gloves, and leather wearing apparel
that were not designated on August 5,
1983, as eligible articles for purposes of
the Generalized System of Preferences
under Title V, Trade Act of 1974, as
amended (19 U.S.C. 2461 through 2467),
provided that the article in question at
the time it is entered:
(a) Was grown, produced, or manufactured in a beneficiary country within
the meaning of § 10.195;
(b) Meets the 35 percent value-content requirement prescribed in § 10.195;
and
(c) Was imported directly from a beneficiary country within the meaning of
§ 10.193.
[T.D. 00–68, 65 FR 59658, Oct. 5, 2000]

§ 10.198b Products of Puerto Rico
processed in a beneficiary country.
Except in the case of any article described in § 10.191(b)(2)(i) through (vi),
the duty-free treatment provided for
under the CBI will apply to an article
that is the growth, product, or manufacture of the Commonwealth of Puerto Rico and that is by any means advanced in value or improved in condition in a beneficiary country, provided
that:
(a) If any materials are added to the
article in the beneficiary country,

those materials consist only of materials that are a product of a beneficiary
country or the United States; and
(b) The article is imported directly
from the beneficiary country into the
customs territory of the United States
within the meaning of § 10.193.
[T.D. 00–68, 65 FR 59658, Oct. 5, 2000]

§ 10.199 Duty-free entry for certain
beverages produced in Canada from
Caribbean rum.
(a) General. A spirituous beverage
that is imported directly from the territory of Canada and that is classifiable under subheading 2208.40 or 2208.90,
Harmonized Tariff Schedule of the
United States (HTSUS), will be entitled, upon entry or withdrawal from
warehouse for consumption, to dutyfree treatment under section 213(a)(6)
of the Caribbean Basin Economic Recovery Act (19 U.S.C. 2703(a)(6)), also
known as the Caribbean Basin Initiative (CBI), if the spirituous beverage
has been produced in the territory of
Canada from rum, provided that the
rum:
(1) Is the growth, product, or manufacture either of a beneficiary country
or of the U.S. Virgin Islands;
(2) Was imported directly into the
territory of Canada from a beneficiary
country or from the U.S. Virgin Islands; and
(3) Accounts for at least 90 percent of
the alcoholic content by volume of the
spirituous beverage.
(b) Claim for exemption from duty
under CBI. A claim for an exemption
from duty for a spirituous beverage
under section 213(a)(6) of the Caribbean
Basin Economic Recovery Act (19
U.S.C. 2703(a)(6)) may be made by entering such beverage under subheading
9817.22.05, HTSUS, on the entry summary document or its electronic equivalent. In order to claim the exemption,
the importer must have the records described in paragraphs (d), (e), (f) and (g)
of this section so that, upon Customs
request, the importer can establish
that:
(1) The rum used to produce the beverage is the growth, product or manufacture either of a beneficiary country
or of the U.S. Virgin Islands;

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U.S. Customs and Border Protection, DHS; Treasury
(2) The rum was shipped directly
from a beneficiary country or from the
U.S. Virgin Islands to Canada;
(3) The beverage was produced in
Canada;
(4) The rum accounts for at least 90%
of the alcohol content of the beverage;
and
(5) The beverage was shipped directly
from Canada to the United States.
(c) Imported directly. For a spirituous
beverage imported from Canada to
qualify for duty-free entry under the
CBI, the spirituous beverage must be
imported directly into the customs territory of the United States from Canada; and the rum used in its production
must have been imported directly into
the territory of Canada either from a
beneficiary country or from the U.S.
Virgin Islands.
(1) ‘‘Imported directly’’ into the customs territory of the United States
from Canada means:
(i) Direct shipment from the territory of Canada to the U.S. without
passing through the territory of any
other country; or
(ii) If the shipment is from the territory of Canada to the U.S. through the
territory of any other country, the
spirituous beverages do not enter into
the commerce of any other country
while en route to the U.S.; or
(iii) If the shipment is from the territory of Canada to the U.S. through the
territory of another country, and the
invoices and other documents do not
show the U.S. as the final destination,
the spirituous beverages in the shipment are imported directly only if
they:
(A) Remained under the control of
the customs authority of the intermediate country;
(B) Did not enter into the commerce
of the intermediate country except for
the purpose of sale other than at retail,
and the port director is satisfied that
the importation results from the original commercial transaction between
the importer and the producer or the
latter’s sales agent; and
(C) Were not subjected to operations
other than loading and unloading, and
other activities necessary to preserve
the products in good condition.
(2) ‘‘Imported directly’’ from a beneficiary country or from the U.S. Virgin

§ 10.199

Islands into the territory of Canada
means:
(i) Direct shipment from a beneficiary country or from the U.S. Virgin
Islands into the territory of Canada
without passing through the territory
of any non-beneficiary country; or
(ii) If the shipment is from a beneficiary country or from the U.S. Virgin
Islands into the territory of Canada
through the territory of any non-beneficiary country, the rum does not enter
into the commerce of any non-beneficiary country while en route to Canada; or
(iii) If the shipment is from a beneficiary country or from the U.S. Virgin
Islands into the territory of Canada
through the territory of any non-beneficiary country, the rum in the shipment is imported directly into the territory of Canada only if it:
(A) Remained under the control of
the customs authority of the intermediate country;
(B) Did not enter into the commerce
of the intermediate country except for
the purpose of sale other than at retail;
and
(C) Was not subjected to operations
in the intermediate country other than
loading and unloading, and other activities necessary to preserve the product in good condition.
(d) Evidence of direct shipment—(1)
Spirituous beverages imported from Canada. The importer must be prepared to
provide to the port director, if requested, documentary evidence that
the spirituous beverages were imported
directly from the territory of Canada,
as described in paragraph (c)(1) of this
section. This evidence may include
documents such as a bill of lading, invoice, air waybill, freight waybill, or
cargo manifest. Any evidence of the direct shipment of these spirituous beverages from Canada into the U.S. may
be subject to such verification as
deemed necessary by the port director.
(2) Rum imported into Canada from
beneficiary country or U.S. Virgin Islands. The importer must be prepared
to provide to the port director, if requested, evidence that the rum used in
producing the spirituous beverages was
imported directly into the territory of
Canada from a beneficiary country or

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§ 10.199

19 CFR Ch. I (4–1–11 Edition)

from the U.S. Virgin Islands, as described in paragraph (c)(2) of this section. This evidence may include documents such as a Canadian customs
entry, Canadian customs invoice, Canadian customs manifest, cargo manifest,
bill of lading, landing certificate, airway bill, or freight waybill. Any evidence of the direct shipment of the rum
from a beneficiary country or from the
U.S. Virgin Islands into the territory
of Canada for use there in producing
the spirituous beverages may be subject to such verification as deemed necessary by the port director.
(e) Origin of rum used in production of
the spirituous beverage—(1) Origin criteria. In order for a spirituous beverage
covered by this section to be entitled
to duty-free entry under the CBI, the
rum used in producing the spirituous
beverage in the territory of Canada
must be wholly the growth, product, or
manufacture either of a beneficiary
country under the CBI or of the U.S.
Virgin Islands, or must constitute a
new or different article of commerce
that was produced or manufactured in
a beneficiary country or in the U.S.
Virgin Islands. Such rum will not be
considered to have been grown, produced, or manufactured in a beneficiary country or in the U.S. Virgin Islands by virtue of having merely undergone blending, combining or packaging
operations, or mere dilution with water
or mere dilution with another substance that does not materially alter
the characteristics of the product.
(2) Evidence of origin of rum—(i) Declaration. The importer must be prepared to submit directly to the port director, if requested, a declaration prepared and signed by the person who
produced or manufactured the rum, affirming that the rum is the growth,
product or manufacture of a beneficiary country or of the U.S. Virgin Islands. While no particular form is prescribed for the declaration, it must include all pertinent information concerning the processing operations by
which the rum was produced or manufactured, the address of the producer or
manufacturer, the title of the party
signing the declaration, and the date it
is signed.
(ii) Records supporting declaration. The
supporting records, including those

production records, that are necessary
for the preparation of the declaration
must also be available for submission
to the port director if requested. The
declaration and any supporting evidence as to the origin of the rum may
be subject to such verification as
deemed necessary by the port director.
(f) Canadian processor declaration; supporting documentation—(1) Canadian
processor declaration. The importer
must be prepared to submit directly to
the port director, if requested, a declaration prepared by the person who
produced the spirituous beverage(s) in
Canada, setting forth all pertinent information concerning the production of
the beverages. The declaration will be
in substantially the following form:
I, llll declare that the spirituous beverages here specified are the products that
were produced by me (us), as described
below, with the use of rum that was received
by me (us); that the rum used in producing
the beverages was received by me (us) on
llll (date), from llll (name and address of owner or exporter in the beneficiary
country or in the U.S. Virgin Islands, as applicable); and that such rum accounts for at
least 90 percent of the alcoholic content by
volume, as shown below, of each spirituous
beverage so produced.

Marks and numbers

Description of products and of processing

Alcoholic content of products; alcoholic
content (%) attributable to
rum 1

..................................
..................................
..................................

.................................
.................................
.................................

........................
........................
........................

1 The production records must establish, for each lot of beverage produced, the quantity of rum the growth, product or
manufacture of a CBI beneficiary country or of the U.S. Virgin
Islands under 19 U.S.C. 2703(a)(6) that is used in producing
the finished beverage; the alcoholic content by volume of the
finished beverage; and the alcoholic content by volume of the
finished beverage, expressed as a percentage, that is attributable to the qualifying rum. If rum from two or more qualifying sources (e.g., rum the growth, product or manufacture of
a CBI beneficiary country or of the U.S. Virgin Islands and
other rum the growth, product or manufacture of another CBI
country) are used in processing the beverage, the alcoholic
content requirement may be met by aggregating the alcoholic
content of the finished beverage that is attributable to rum
from each of the qualifying sources used in processing the finished beverage, as reflected in the production records.

Date lllllllllllllllllllll
Address lllllllllllllllllll
Signature llllllllllllllllll
Title lllllllllllllllllllll

(2) Availability of supporting documents. The information, including any

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U.S. Customs and Border Protection, DHS; Treasury
supporting documents and records, necessary for the preparation of the declaration, as described in paragraph
(f)(1) of this section, must be available
for submission to the port director, if
requested. The declaration and any
supporting evidence may be subject to
such verification as deemed necessary
by the port director. The specific documentary evidence necessary to support
the declaration consists of those documents and records which satisfactorily
establish:
(i) The receipt of the rum by the Canadian processor, including the date of
receipt and the name and address of
the party from whom the rum was received (the owner or exporter in the
beneficiary country or the U.S. Virgin
Islands); and
(ii) For each lot of beverage produced
and included in the declaration, the
specific identification of the production lot(s) involved; the quantity of
qualifying rum that is used in producing the finished beverage, including
a description of the processing and of
the finished products; the alcoholic
content by volume of the finished beverage; and the alcoholic content by volume of the finished beverage, expressed
as a percentage, that is attributable to
the qualifying rum.
(g) Importer system for review of necessary recordkeeping. The importer will
establish and implement a system of
internal controls which demonstrate
that reasonable care was exercised in
its claim for duty-free treatment under
the CBI. These controls should include
tests to assure the accuracy and availability of records that establish:
(1) The origin of the rum;
(2) The direct shipment of the rum
from a beneficiary country or from the
U.S. Virgin Islands to Canada;
(3) The alcohol content of the finished beverage imported from Canada;
and
(4) The direct shipment of the finished beverage from Canada to the
United States.
(h) Submission of documents to Customs. The importer must be prepared to
submit directly to the port director, if
requested, those documents and/or supporting records as described in paragraphs (d), (e) and (f) of this section,
for a period of 5 years from the date of

§ 10.202

entry of the related spirituous beverages under section 213(a)(6) of the
Caribbean Basin Economic Recovery
Act (19 U.S.C. 2703(a)(6)), as provided in
§ 163.4(a) of this chapter. If requested,
the importer must submit such documents and/or supporting records to the
port director within 60 calendar days of
the date of the request or such additional period as the port director may
allow for good cause shown.
[T.D. 02–59, 67 FR 62882, Oct. 9, 2002]

Subpart C—Andean Trade
Preference
SOURCE: Sections 10.201 through 10.208 appear at T.D. 98–76, 63 FR 51292, Sept. 25, 1998,
unless otherwise noted.

§ 10.201 Applicability.
Title II of Pub. L. 102–182 (105 Stat.
1233), entitled the Andean Trade Preference Act (ATPA) and codified at 19
U.S.C. 3201 through 3206, authorizes the
President to proclaim duty-free treatment for all eligible articles from any
beneficiary country and to designate
countries as beneficiary countries. The
provisions of §§ 10.202 through 10.207 set
forth the legal requirements and procedures that apply for purposes of obtaining that duty-free treatment for certain articles from a beneficiary country which are identified for purposes of
that treatment in General Note 11,
Harmonized Tariff Schedule of the
United States (HTSUS), and in the
‘‘Special’’ rate of duty column of the
HTSUS. Provisions regarding preferential treatment of apparel and other
textile articles under the ATPA are
contained in §§ 10.241 through 10.248,
and provisions regarding preferential
treatment of tuna and certain other
non-textile articles under the ATPA
are contained in §§ 10.251 through 10.257.
[T.D. 03–16, 68 FR 14486, Mar. 25, 2003; 68 FR
67338, Dec. 1, 2003]

§ 10.202 Definitions.
The following definitions apply for
purposes of §§ 10.201 through 10.207:
(a) Beneficiary country. Except as otherwise provided in § 10.206(b), the term
‘‘beneficiary country’’ refers to any
country or successor political entity
with respect to which there is in effect

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§ 10.203

19 CFR Ch. I (4–1–11 Edition)

a proclamation by the President designating such country or successor political entity as a beneficiary country in
accordance with section 203 of the
ATPA (19 U.S.C. 3202).
(b) Eligible articles. The term ‘‘eligible’’
when used with reference to an article
means merchandise which is imported
directly from a beneficiary country as
provided in § 10.204, which meets the
country of origin criteria set forth in
§ 10.205 and the value-content requirement set forth in § 10.206, and which, if
the requirements of § 10.207 are met, is
therefore entitled to duty-free treatment under the ATPA. However, the
following merchandise shall not be
considered eligible articles entitled to
duty-free treatment under the ATPA:
(1) Textiles and apparel articles
which were not eligible articles for
purposes of the ATPA on January 1,
1994, as the ATPA was in effect on that
date, except as otherwise provided in
§§ 10.241 through 10.248;
(2) Rum and tafia classified in subheading 2208.40, Harmonized Tariff
Schedule of the United States;
(3) Sugars, syrups, and sugar-containing products subject to over-quota
duty rates under applicable tariff-rate
quotas; or
(4) Tuna prepared or preserved in any
manner in airtight containers, except
as otherwise provided in §§ 10.251
through 10.257.
(c) Entered. The term ‘‘entered’’ means
entered, or withdrawn from warehouse
for consumption, in the customs territory of the United States.
(d) Wholly the growth, product, or manufacture of a beneficiary country. The expression ‘‘wholly the growth, product,
or manufacture of a beneficiary country’’ has the same meaning as that set
forth in § 10.191(b)(3) of this part.
[T.D. 98–76, 63 FR 51292, Sept. 25, 1998, as
amended by T.D. 03–16, 68 FR 14486, Mar. 25,
2003; 68 FR 67338, Dec. 1, 2003]

§ 10.203 Eligibility criteria in general.
An article classifiable under a subheading of the Harmonized Tariff
Schedule of the United States for
which a rate of duty of ‘‘Free’’ appears
in the ‘‘Special’’ subcolumn followed by
the symbol ‘‘J’’ or ‘‘J*’’ in parentheses is
eligible for duty-free treatment, and
will be accorded such treatment, if

each of the following requirements is
met:
(a) Imported directly. The article is
imported directly from a beneficiary
country as provided in § 10.204.
(b) Country of origin criteria. The article complies with the country of origin
criteria set forth in § 10.205.
(c) Value content requirement. The article complies with the value content
requirement set forth in § 10.206.
(d) Filing of claim and submission of
supporting documentation. The claim for
duty-free treatment is filed, and any
required documentation in support of
the claim is submitted, in accordance
with the procedures set forth in § 10.207.
§ 10.204 Imported directly.
In order to be eligible for duty-free
treatment under the ATPA, an article
shall be imported directly from a beneficiary country into the customs territory of the United States. For purposes
of this requirement, the words ‘‘imported directly’’ mean:
(a) Direct shipment from any beneficiary country to the United States
without passing through the territory
of any non-beneficiary country; or
(b) If shipment from any beneficiary
country to the United States was
through the territory of a non-beneficiary country, the articles in the
shipment did not enter into the commerce of the non-beneficiary country
while en route to the United States,
and the invoices, bills of lading, and
other shipping documents show the
United States as the final destination;
or
(c) If shipment from any beneficiary
country to the United States was
through the territory of a non-beneficiary country and the invoices and
other documents do not show the
United States as the final destination,
then the articles in the shipment, upon
arrival in the United States, are imported directly only if they:
(1) Remained under the control of the
customs authority in the intermediate
country;
(2) Did not enter into the commerce
of the intermediate country except for
the purpose of sale other than at retail,
and the articles are imported into the
United States as a result of the original commercial transaction between

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U.S. Customs and Border Protection, DHS; Treasury
the importer and the producer or the
latter’s sales agent; and
(3) Were not subjected to operations
in the intermediate country other than
loading and unloading, and other activities necessary to preserve the articles in good condition.
§ 10.205 Country of origin criteria.
(a) General. Except as otherwise provided in paragraph (b) of this section,
an article may be eligible for duty-free
treatment under the ATPA if the article is either:
(1) Wholly the growth, product, or
manufacture of a beneficiary country;
or
(2) A new or different article of commerce which has been grown, produced,
or manufactured in a beneficiary country.
(b) Exceptions. No article shall be eligible for duty-free treatment under the
ATPA by virtue of having merely undergone simple (as opposed to complex
or meaningful) combining or packaging
operations, or mere dilution with water
or mere dilution with another substance that does not materially alter
the characteristics of the article. The
principles and examples set forth in
§ 10.195(a)(2) of this part shall apply
equally for purposes of this paragraph.
§ 10.206 Value content requirement.
(a) General. An article may be eligible
for duty-free treatment under the
ATPA only if the sum of the cost or
value of the materials produced in a
beneficiary country or countries, plus
the direct costs of processing operations performed in a beneficiary country or countries, is not less than 35 percent of the appraised value of the article at the time it is entered.
(b) Commonwealth of Puerto Rico, U.S.
Virgin Islands and CBI beneficiary countries. For purposes of determining the
percentage referred to in paragraph (a)
of this section, the term ‘‘beneficiary
country’’ includes the Commonwealth
of Puerto Rico, the U.S. Virgin Islands,
and any CBI beneficiary country as defined in § 10.191(b)(1) of this part. Any
cost or value of materials or direct
costs of processing operations attributable to the Virgin Islands or any CBI
beneficiary country must be included
in the article prior to its final expor-

§ 10.206

tation to the United States from a beneficiary
country
as
defined
in
§ 10.202(a).
(c) Materials produced in the United
States. For purposes of determining the
percentage referred to in paragraph (a)
of this section, an amount not to exceed 15 percent of the appraised value
of the article at the time it is entered
may be attributed to the cost or value
of materials produced in the customs
territory of the United States (other
than the Commonwealth of Puerto
Rico). The principles set forth in paragraph (d)(1) of this section shall apply
in determining whether a material is
‘‘produced in the customs territory of
the United States’’ for purposes of this
paragraph.
(d) Cost or value of materials—(1) ‘‘Materials produced in a beneficiary country
or countries’’ defined. For purposes of
paragraph (a) of this section, the words
materials produced in a beneficiary country or countries refer to those materials
incorporated in an article which are either:
(i) Wholly the growth, product, or
manufacture of a beneficiary country
or two or more beneficiary countries;
or
(ii) Substantially transformed in any
beneficiary country or two or more
beneficiary countries into a new or different article of commerce which is
then used in any beneficiary country as
defined in § 10.202(a) in the production
or manufacture of a new or different
article which is imported directly into
the United States. For purposes of this
paragraph (d)(1)(ii), no material shall
be considered to be substantially transformed into a new or different article
of commerce by virtue of having merely undergone simple (as opposed to
complex or meaningful) combining or
packaging operations, or mere dilution
with water or mere dilution with another substance that does not materially alter the characteristics of the article. The examples set forth in
§ 10.196(a) of this part, and the principles and examples set forth in
§ 10.195(a)(2) of this part, shall apply for
purposes of the corresponding context
under paragraph (d)(1) of this section.

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§ 10.206

19 CFR Ch. I (4–1–11 Edition)

(2) Questionable origin. When the origin of a material either is not ascertainable or is not satisfactorily demonstrated to the appropriate port director, the material shall not be considered to have been grown, produced, or
manufactured in a beneficiary country
or in the customs territory of the
United States.
(3) Determination of cost or value of
materials. (i) The cost or value of materials produced in a beneficiary country
or countries or in the customs territory of the United States includes:
(A) The manufacturer’s actual cost
for the materials;
(B) When not included in the manufacturer’s actual cost for the materials,
the freight, insurance, packing, and all
other costs incurred in transporting
the materials to the manufacturer’s
plant;
(C) The actual cost of waste or spoilage, less the value of recoverable scrap;
and
(D) Taxes and/or duties imposed on
the materials by any beneficiary country or by the United States, provided
they are not remitted upon exportation.
(ii) Where a material is provided to
the manufacturer without charge, or at
less than fair market value, its cost or
value shall be determined by computing the sum of:
(A) All expenses incurred in the
growth, production, or manufacture of
the material, including general expenses;
(B) An amount for profit; and
(C) Freight, insurance, packing, and
all other costs incurred in transporting
the material to the manufacturer’s
plant.
(iii) If the pertinent information
needed to compute the cost or value of
a material is not available, the appraising officer may ascertain or estimate the value thereof using all reasonable ways and means at his disposal.
(e) Direct costs of processing operations—(1) Items included. For purposes
of paragraph (a) of this section, the
words direct costs of processing operations mean those costs either directly
incurred in, or which can be reasonably
allocated to, the growth, production,
manufacture, or assembly of the spe-

cific merchandise under consideration.
Such costs include, but are not limited
to the following, to the extent that
they are includable in the appraised
value of the imported merchandise:
(i) All actual labor costs involved in
the growth, production, manufacture,
or assembly of the specific merchandise, including fringe benefits, on-thejob training, and the cost of engineering, supervisory, quality control, and
similar personnel;
(ii) Dies, molds, tooling, and depreciation on machinery and equipment
which are allocable to the specific merchandise;
(iii) Research, development, design,
engineering, and blueprint costs insofar as they are allocable to the specific
merchandise; and
(iv) Costs of inspecting and testing
the specific merchandise.
(2) Items not included. For purposes of
paragraph (a) of this section, the words
‘‘direct costs of processing operations’’
do not include items which are not directly attributable to the merchandise
under consideration or are not costs of
manufacturing the product. These include, but are not limited to:
(i) Profit; and
(ii) General expenses of doing business which either are not allocable to
the specific merchandise or are not related to the growth, production, manufacture, or assembly of the merchandise, such as administrative salaries,
casualty and liability insurance, advertising, and salesmen’s salaries, commissions, or expenses.
(f) Articles wholly the growth, product,
or manufacture of a beneficiary country.
Any article which is wholly the
growth, product, or manufacture of a
beneficiary country as defined in
§ 10.202(a), and any article produced or
manufactured in a beneficiary country
as defined in § 10.202(a) exclusively from
materials which are wholly the growth,
product, or manufacture of a beneficiary country or countries, shall normally be presumed to meet the requirement set forth in paragraph (a) of this
section.

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U.S. Customs and Border Protection, DHS; Treasury
§ 10.207 Procedures for filing duty-free
treatment claim and submitting
supporting documentation.
(a) Filing claim for duty-free treatment.
Except as provided in paragraph (c) of
this section, a claim for duty-free
treatment under the ATPA may be
made at the time of filing the entry
summary by placing the symbol ‘‘J’’ as
a prefix to the Harmonized Tariff
Schedule of the United States subheading number applicable to each article for which duty-free treatment is
claimed on that document.
(b) Shipments covered by a formal
entry—(1) Articles not wholly the growth,
product, or manufacture of a beneficiary
country—(i) Declaration. In a case involving an article covered by a formal
entry for which duty-free treatment is
claimed under the ATPA and which is
not wholly the growth, product, or
manufacture of a single beneficiary
country as defined in § 10.202(a), the exporter or other appropriate party having knowledge of the relevant facts in
the beneficiary country as defined in
§ 10.202(a) where the article was pro-

Number and date of
invoices

Description of articles and quantity

§ 10.207

duced or last processed shall be prepared to submit directly to the port director, upon request, a declaration setting forth all pertinent detailed information concerning the production or
manufacture of the article. When requested by the port director, the declaration shall be prepared in substantially the following form:
ATPA DECLARATION
I, llllll (name), hereby declare that
the articles described below (a) were produced or manufactured in llllll (country) by means of processing operations performed in that country as set forth below
and were also subjected to processing operations in the other beneficiary country or
countries (including the Commonwealth of
Puerto Rico, the U.S. Virgin Islands, and any
CBI beneficiary country) as set forth below
and (b) incorporate materials produced in
the country named above or in any other
beneficiary country or countries (including
the Commonwealth of Puerto Rico, the U.S.
Virgin Islands, and any CBI beneficiary
country) or in the customs territory of the
United States (other than the Commonwealth of Puerto Rico) as set forth below:

Processing operations performed on articles

Material produced in a beneficiary country or in the U.S.

Description of
processing operations and country
of processing

Description of material, production
process, and country of production

Date lllllllllllllllllllll
Address lllllllllllllllllll
Signature llllllllllllllllll
Title lllllllllllllllllllll

(ii) Retention of records and submission
of declaration. The information necessary for the preparation of the declaration shall be retained in the files of
the party responsible for its preparation and submission for a period of 5
years. In the event that the port director requests submission of the declaration during the 5-year period, it shall
be submitted by the appropriate party
directly to the port director within 60
days of the date of the request or such
additional period as the port director
may allow for good cause shown. Failure to submit the declaration in a
timely fashion will result in a denial of
duty-free treatment.

Direct costs of
processing operations

Cost or value of
material

(iii) Value added after final exportation. In a case in which value is added
to an article in the Commonwealth of
Puerto Rico or in the United States
after final exportation of the article
from a beneficiary country as defined
in § 10.202(a), in order to ensure compliance with the value requirement under
§ 10.206(a), the declaration provided for
in paragraph (b)(1)(i) of this section
shall be filed by the importer or consignee with the entry summary. The
declaration shall be completed by the
party responsible for the addition of
such value.
(2) Articles wholly the growth, product,
or manufacture of a beneficiary country.
In a case involving an article covered
by a formal entry for which duty-free
treatment is claimed under the ATPA

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§ 10.211

19 CFR Ch. I (4–1–11 Edition)

and which is wholly the growth, product, or manufacture of a single beneficiary country as defined in § 10.202(a),
a statement to that effect shall be included on the commercial invoice provided to Customs.
(c) Shipments covered by an informal
entry. The normal procedure for filing a
claim for duty-free treatment as set
forth in paragraph (a) of this section
need not be followed, and the filing of
the declaration provided for in paragraph (b)(1)(i) of this section will not
be required, in a case involving a shipment covered by an informal entry.
However, the port director may require
submission of such other evidence of
entitlement to duty-free treatment as
deemed necessary.
(d) Evidence of direct importation—(1)
Submission. The port director may require that appropriate shipping papers,
invoices, or other documents be submitted within 60 days of the date of
entry as evidence that the articles
were ‘‘imported directly’’, as that term
is defined in § 10.204.
(2) Waiver. The port director may
waive the submission of evidence of direct importation when otherwise satisfied, taking into consideration the kind
and value of the merchandise, that the
merchandise was, in fact, imported directly and that it otherwise clearly
qualifies for duty-free treatment under
the ATPA.
(e) Verification of documentation. The
documentation submitted under this
section to demonstrate compliance
with the requirements for duty-free
treatment under the ATPA shall be
subject to such verification as the port
director deems necessary. In the event
that the port director is prevented
from
obtaining
the
necessary
verification, the port director may
treat the entry as fully dutiable.

Subpart D—Textile and Apparel
Articles Under the African
Growth and Opportunity Act
SOURCE: T.D. 00–67, 65 FR 59676, Oct. 5, 2000,
unless otherwise noted.

§ 10.211 Applicability.
Title I of Public Law 106–200 (114
Stat. 251), entitled the African Growth
and Opportunity Act (AGOA), author-

izes the President to extend certain
trade benefits to designated countries
in sub-Saharan Africa. Section 112 of
the AGOA, codified at 19 U.S.C. 3721,
provides for the preferential treatment
of certain textile and apparel articles
from beneficiary countries. The provisions of §§ 10.211–10.217 of this part set
forth the legal requirements and procedures that apply for purposes of obtaining preferential treatment pursuant to
section 112.
§ 10.212

Definitions.

When used in §§ 10.211 through 10.217,
the following terms have the meanings
indicated:
Apparel articles. ‘‘Apparel articles’’
means goods classifiable in Chapters 61
and 62 and headings 6501, 6502, 6503, and
6504 and subheadings 6406.99 and 6505.90
of the HTSUS.
Assembled in one or more beneficiary
countries. ‘‘Assembled in one or more
beneficiary countries’’ when used in the
context of a textile or apparel article
has reference to a joining together of
two or more components that occurred
in one or more beneficiary countries,
whether or not a prior joining operation was performed on the article or
any of its components in the United
States.
Beneficiary
country.
‘‘Beneficiary
country’’ means a country listed in section 107 of the African Growth and Opportunity Act (19 U.S.C. 3706) which has
been the subject of a finding by the
President or his designee, published in
the FEDERAL REGISTER, that the country has satisfied the requirements of
section 113 of the African Growth and
Opportunity Act (19 U.S.C. 3722) and
which the President has designated as
a beneficiary sub-Saharan African
country under section 506A of the
Trade Act of 1974 (19 U.S.C. 2466a).
Cut in one or more beneficiary countries. ‘‘Cut in one or more beneficiary
countries’’ when used with reference to
apparel articles means that all fabric
components used in the assembly of
the article were cut from fabric in one
or more beneficiary countries.
Foreign. ‘‘Foreign’’ means of a country
other than the United States or a beneficiary country.

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U.S. Customs and Border Protection, DHS; Treasury
HTSUS. ‘‘HTSUS’’ means the Harmonized Tariff Schedule of the United
States.
Knit-to-shape articles. ‘‘Knit-to-shape,’’
when used with reference to sweaters
or other apparel articles, means any
apparel article of which 50 percent or
more of the exterior surface area is
formed by major parts that have been
knitted or crocheted directly to the
shape used in the apparel article, with
no consideration being given to patch
pockets, appliques, or the like. Minor
cutting, trimming, or sewing of those
major parts will not affect the determination of whether an apparel article
is ‘‘knit-to-shape.’’
Knit-to-shape components. ‘‘Knit-toshape,’’ when used with reference to
textile components, means components
that are knitted or crocheted from a
yarn directly to a specific shape containing a self-start edge. Minor cutting
or trimming will not affect the determination of whether a component is
‘‘knit-to-shape.’’
Major parts. ‘‘Major parts’’ means integral components of an apparel article
but does not include collars, cuffs,
waistbands, plackets, pockets, linings,
paddings, trim, accessories, or similar
parts or components.
NAFTA. ‘‘NAFTA’’ means the North
American Free Trade Agreement entered into by the United States, Canada, and Mexico on December 17, 1992.
Originating. ‘‘Originating’’ means having the country of origin determined
by application of the provisions of
§ 102.21 of this chapter.
Preferential treatment. ‘‘Preferential
treatment’’ means entry, or withdrawal
from warehouse for consumption, in
the customs territory of the United
States free of duty and free of any
quantitative limitations as provided in
19 U.S.C. 3721.
Wholly assembled in. When used with
reference to a textile or apparel article
in the context of one or more beneficiary countries or one or more lesser
developed beneficiary countries, the
expression
‘‘wholly
assembled
in’’
means that all of the components of
the textile or apparel article (including
thread, decorative embellishments,
buttons, zippers, or similar components) were joined together in one or
more beneficiary countries or one or

§ 10.213

more lesser developed beneficiary
countries.
Wholly
formed
fabrics.
‘‘Wholly
formed,’’ when used with reference to
fabric(s), means that all of the production processes, starting with polymers,
fibers, filaments, textile strips, yarns,
twine, cordage, rope, or strips of fabric
and ending with a fabric by a weaving,
knitting, needling, tufting, felting, entangling or other process, took place in
the United States or in one or more
beneficiary countries.
Wholly formed on seamless knitting machines. ‘‘Wholly formed on seamless
knitting machines,’’ when used to describe apparel articles, has reference to
a process that created a knit-to-shape
apparel article by feeding yarn(s) into
a knitting machine to result in that article. When taken from the knitting
machine, an apparel article created by
this process either is in its final form
or requires only minor cutting or trimming or the addition of minor components or parts such as patch pockets,
appliques, capping, or elastic strip.
Wholly formed yarns. ‘‘Wholly formed,’’
when used with reference to yarns,
means that all of the production processes, starting with the extrusion of
filament, strip, film, or sheet and including slitting a film or sheet into
strip, or the spinning of all fibers into
yarn, or both, and ending with a yarn
or plied yarn, took place in a single
country.
[T.D. 00–67, 65 FR 59676, Oct. 5, 2000; 65 FR
67260, Nov. 9, 2000, as amended by T.D. 03–15,
68 FR 13824, Mar. 21, 2003]

§ 10.213 Articles eligible for preferential treatment.
(a) General. The preferential treatment referred to in § 10.211 applies to
the following textile and apparel articles that are imported directly into the
customs territory of the United States
from a beneficiary country:
(1) Apparel articles sewn or otherwise
assembled in one or more beneficiary
countries from fabrics wholly formed
and cut, or from components knit-toshape, in the United States, from yarns
wholly formed in the United States,
(including fabrics not formed from
yarns, if those fabrics are classifiable
under heading 5602 or 5603 of the
HTSUS and are wholly formed and cut

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§ 10.213

19 CFR Ch. I (4–1–11 Edition)

in the United States) that are entered
under subheading 9802.00.80 of the
HTSUS;
(2) Apparel articles sewn or otherwise
assembled in one or more beneficiary
countries from fabrics wholly formed
and cut, or from components knit-toshape, in the United States, from yarns
wholly formed in the United States,
(including fabrics not formed from
yarns, if those fabrics are classifiable
under heading 5602 or 5603 of the
HTSUS and are wholly formed and cut
in the United States) that are entered
under Chapter 61 or 62 of the HTSUS,
if, after that assembly, the articles
would have qualified for entry under
subheading 9802.00.80 of the HTSUS but
for the fact that the articles were embroidered or subjected to stone-washing, enzyme-washing, acid washing,
perma-pressing, oven-baking, bleaching, garment-dyeing, screen printing,
or other similar processes in a beneficiary country;
(3) Apparel articles sewn or otherwise
assembled in one or more beneficiary
countries with thread formed in the
United States from fabrics wholly
formed in the United States and cut in
one or more beneficiary countries from
yarns wholly formed in the United
States, or from components knit-toshape in the United States from yarns
wholly formed in the United States, or
both (including fabrics not formed
from yarns, if those fabrics are classifiable under heading 5602 or 5603 of the
HTSUS and are wholly formed in the
United States).
(4) Apparel articles wholly assembled
in one or more beneficiary countries
from fabric wholly formed in one or
more beneficiary countries from yarns
originating either in the United States
or one or more beneficiary countries
(including fabrics not formed from
yarns, if those fabrics are classified
under heading 5602 or 5603 of the
HTSUS and are wholly formed in one
or more beneficiary countries), or from
components knit-to-shape in one or
more beneficiary countries from yarns
originating either in the United States
or in one or more beneficiary countries, or apparel articles wholly formed
on seamless knitting machines in a
beneficiary country from yarns originating either in the United States or in

one or more beneficiary countries, subject to the applicable quantitative
limit published in the FEDERAL REGISTER pursuant to U.S. Note 2, Subchapter XIX, Chapter 98, HTSUS;
(5) Apparel articles wholly assembled, or knit-to-shape and wholly assembled, or both, in one or more lesser
developed beneficiary countries regardless of the country of origin of the fabric or the yarn used to make the articles, subject to the applicable quantitative limit published in the FEDERAL
REGISTER pursuant to U.S. Note 2, Subchapter XIX, Chapter 98, HTSUS;
(6) Sweaters, in chief weight of cashmere, knit-to-shape in one or more
beneficiary countries and classifiable
under subheading 6110.10 of the HTSUS;
(7) Sweaters, containing 50 percent or
more by weight of wool measuring 21.5
microns in diameter or finer, knit-toshape in one or more beneficiary countries;
(8) Apparel articles, other than brassieres classifiable under subheading
6212.10, HTSUS, that are both cut (or
knit-to-shape) and sewn or otherwise
assembled in one or more beneficiary
countries, from fabrics or yarn that is
not formed in the United States or a
beneficiary country, provided that apparel articles of those fabrics or yarn
would be considered an originating
good under General Note 12(t), HTSUS,
if the apparel articles had been imported directly from Canada or Mexico;
(9) Apparel articles that are both cut
(or knit-to-shape) and sewn or otherwise assembled in one or more beneficiary countries from fabrics or yarn
that the President or his designee has
designated in the FEDERAL REGISTER as
not available in commercial quantities
in the United States;
(10) A handloomed, handmade, or
folklore article of a beneficiary country or countries that is certified as a
handloomed, handmade, or folklore article by the competent authority of the
beneficiary country or countries, provided that the President or his designee has determined that the article
in question will be treated as being a
handloomed, handmade, or folklore article.

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U.S. Customs and Border Protection, DHS; Treasury
(11) Apparel articles sewn or otherwise assembled in one or more beneficiary countries with thread formed in
the United States:
(i) From components cut in the
United States and in one or more beneficiary countries from fabric wholly
formed in the United States from yarns
wholly formed in the United States (including fabrics not formed from yarns,
if those fabrics are classifiable under
heading 5602 or 5603 of the HTSUS);
(ii) From components knit-to-shape
in the United States and one or more
beneficiary countries from yarns wholly formed in the United States; or
(iii) From any combination of two or
more of the cutting or knitting-toshape operations described in paragraph (a)(11)(i) or paragraph (a)(11)(ii)
of this section.
(b) Special rules for certain component
materials—(1) General. An article otherwise described under paragraph (a) of
this section will not be ineligible for
the preferential treatment referred to
in § 10.211 because the article contains:
(i) Findings and trimmings of foreign
origin, if the value of those findings
and trimmings does not exceed 25 percent of the cost of the components of
the assembled article. For purposes of
this section ‘‘findings and trimmings’’
include, but are not limited to, hooks
and eyes, snaps, buttons, ‘‘bow buds,’’
decorative lace trim, elastic strips (but
only if they are each less than 1 inch in
width and are used in the production of
brassieres), zippers (including zipper
tapes), labels, and sewing thread except
in the case of an article described in
paragraph (a)(3) of this section;
(ii) Interlinings of foreign origin, if
the value of those interlinings does not
exceed 25 percent of the cost of the
components of the assembled article.
For purposes of this section ‘‘interlinings’’ include only a chest type
plate, a ‘‘hymo’’ piece, or ‘‘sleeve header,’’ of woven or weft-inserted warp
knit construction and of coarse animal
hair or man-made filaments;
(iii) Any combination of findings and
trimmings of foreign origin and interlinings of foreign origin, if the total
value of those findings and trimmings
and interlinings does not exceed 25 percent of the cost of the components of
the assembled article; or

§ 10.213

(iv) Fibers or yarns not wholly
formed in the United States or one or
more beneficiary countries if the total
weight of all those fibers and yarns is
not more than 7 percent of the total
weight of the article.
(2) ‘‘Cost’’and ‘‘value’’ defined. The
‘‘cost’’ of components and the ‘‘value’’ of
findings and trimmings or interlinings
referred to in paragraph (b)(1) of this
section means:
(i) The price of the components, findings and trimmings, or interlinings
when last purchased, f.o.b. port of exportation, as set out in the invoice or
other commercial documents, or, if the
price is other than f.o.b. port of exportation:
(A) The price as set out in the invoice
or other commercial documents adjusted to arrive at an f.o.b. port of exportation price; or
(B) If no exportation to a beneficiary
country is involved, the price as set
out in the invoice or other commercial
documents, less the freight, insurance,
packing and other costs incurred in
transporting the components, findings
and trimmings, or interlinings to the
place of production if included in that
price; or
(ii) If the price cannot be determined
under paragraph (b)(2)(i) of this section
or if Customs finds that price to be unreasonable, all reasonable expenses incurred in the growth, production, manufacture, or other processing of the
components, findings and trimmings,
or interlinings, including the cost or
value of materials and general expenses, plus a reasonable amount for
profit, and the freight, insurance, packing, and other costs, if any, incurred in
transporting the components, findings
and trimmings, or interlinings to the
port of exportation.
(3) Treatment of fibers and yarns as
findings or trimmings. If any fibers or
yarns not wholly formed in the United
States or one or more beneficiary countries are used in an article as a finding
or trimming described in paragraph
(b)(1)(i) of this section, the fibers or
yarns will be considered to be a finding
or trimming for purposes of paragraph
(b)(1) of this section.
(c) Imported directly defined. For purposes of paragraph (a) of this section,
the words ‘‘imported directly’’ mean:

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§ 10.214

19 CFR Ch. I (4–1–11 Edition)

(1) Direct shipment from any beneficiary country to the United States
without passing through the territory
of any non-beneficiary country;
(2) If the shipment is from any beneficiary country to the United States
through the territory of any non-beneficiary country, the articles in the
shipment do not enter into the commerce of any non-beneficiary country
while en route to the United States and
the invoices, bills of lading, and other
shipping documents show the United
States as the final destination; or
(3) If the shipment is from any beneficiary country to the United States
through the territory of any non-beneficiary country, and the invoices and
other documents do not show the
United States as the final destination,
the articles in the shipment upon arrival in the United States are imported
directly only if they:
(i) Remained under the control of the
customs authority of the intermediate
country;
(ii) Did not enter into the commerce
of the intermediate country except for
the purpose of sale other than at retail,
and the port director is satisfied that
the importation results from the original commercial transaction between
the importer and the producer or the
producer’s sales agent; and

(iii) Were not subjected to operations
other than loading or unloading, and
other activities necessary to preserve
the articles in good condition.
[T.D. 00–67, 65 FR 59676, Oct. 5, 2000; 65 FR
67260, Nov. 9, 2000, as amended by T.D. 03–15,
68 FR 13824, Mar. 21, 2003]

§ 10.214 Certificate of Origin.
(a) General. A Certificate of Origin
must be employed to certify that a textile or apparel article being exported
from a beneficiary country to the
United States qualifies for the preferential treatment referred to in
§ 10.211. The Certificate of Origin must
be prepared by the exporter in the beneficiary country in the form specified
in paragraph (b) of this section. Where
the beneficiary country exporter is not
the producer of the article, that exporter may complete and sign a Certificate of Origin on the basis of:
(1) Its reasonable reliance on the producer’s written representation that the
article qualifies for preferential treatment; or
(2) A completed and signed Certificate of Origin for the article voluntarily provided to the exporter by the
producer.
(b) Form of Certificate. The Certificate
of Origin referred to in paragraph (a) of
this section must be in the following
format:

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U.S. Customs and Border Protection, DHS; Treasury

(c) Preparation of Certificate. The following rules will apply for purposes of
completing the Certificate of Origin set
forth in paragraph (b) of this section:
(1) Blocks 1 through 5 pertain only to
the final article exported to the United

§ 10.214

States for which preferential treatment may be claimed;
(2) Block 1 should state the legal
name and address (including country)
of the exporter;
(3) Block 2 should state the legal
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ER21MR03.001

185

§ 10.215

19 CFR Ch. I (4–1–11 Edition)

of the producer. If there is more than
one producer, attach a list stating the
legal name and address (including
country) of all additional producers. If
this information is confidential, it is
acceptable to state ‘‘available to Customs upon request’’ in block 2. If the
producer and the exporter are the
same, state ‘‘same’’ in block 2;
(4) Block 3 should state the legal
name and address (including country)
of the importer;
(5) In block 4, insert the number and/
or letter that identifies the preference
group which applies to the article according to the description contained in
the CFR provision cited on the Certificate for that group;
(6) Block 5 should provide a full description of each article. The description should be sufficient to relate it to
the invoice description and to the description of the article in the international Harmonized System. Include
the invoice number as shown on the
commercial invoice or, if the invoice
number is not known, include another
unique reference number such as the
shipping order number;
(7) Blocks 6 through 10 must be completed only when the block in question
calls for information that is relevant
to the preference group identified in
block 4;
(8) Block 6 should state the legal
name and address (including country)
of the fabric producer;
(9) Block 7 should state the legal
name and address (including country)
of the yarn producer;
(10) Block 8 should state the legal
name and address (including country)
of the thread producer;
(11) Block 9 should state the name of
the folklore article or should state that
the article is handloomed or handmade;
(12) Block 10 should be completed
only when the preference group identifier ‘‘8’’ and/or ‘‘H’’ is inserted in block 4
and should state the name of the fabric
or yarn that is in short supply in the
NAFTA or that has been designated as
not available in commercial quantities
in the United States;
(13) Block 11 must contain the signature of the exporter or of the exporter’s
authorized agent having knowledge of
the relevant facts;

(14) Block 15 should reflect the date
on which the Certificate was completed
and signed;
(15) Block 16 should be completed if
the Certificate is intended to cover
multiple shipments of identical articles as described in block 5 that are imported into the United States during a
specified period of up to one year (see
§ 10.216(b)(4)(ii)). The ‘‘from’’ date is the
date on which the Certificate became
applicable to the article covered by the
blanket Certificate (this date may be
prior to the date reflected in block 15).
The ‘‘to’’ date is the date on which the
blanket period expires;
(16) The telephone and facsimile
numbers included in block 17 should be
those at which the person who signed
the Certificate may be contacted; and
(17) The Certificate may be printed
and reproduced locally. If more space is
needed to complete the Certificate, attach a continuation sheet.
[T.D. 00–67, 65 FR 59676, Oct. 5, 2000, as
amended by T.D. 03–15, 68 FR 13825, Mar. 21,
2003]

§ 10.215 Filing of claim for preferential
treatment.
(a) Declaration. In connection with a
claim for preferential treatment for a
textile or apparel article described in
§ 10.213, the importer must make a
written declaration that the article
qualifies for that treatment. The inclusion on the entry summary, or equivalent documentation, of the subheading
within Chapter 98 of the HTSUS under
which the article is classified will constitute the written declaration. Except
in any of the circumstances described
in § 10.216(d)(1), the declaration required under this paragraph must be
based on an original Certificate of Origin that has been completed and properly executed in accordance with
§ 10.214, that covers the article being
imported, and that is in the possession
of the importer.
(b) Corrected declaration. If, after
making the declaration required under
paragraph (a) of this section, the importer has reason to believe that a Certificate of Origin on which a declaration was based contains information
that is not correct, the importer must
within 30 calendar days after the date

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U.S. Customs and Border Protection, DHS; Treasury
of discovery of the error make a corrected declaration and pay any duties
that may be due. A corrected declaration will be effected by submission of a
letter or other written statement to
the Customs port where the declaration was originally filed.
[T.D. 00–67, 65 FR 59676, Oct. 5, 2000, as
amended by T.D. 03–15, 68 FR 13827, Mar. 21,
2003]

§ 10.216 Maintenance of records and
submission of Certificate by importer.
(a) Maintenance of records. Each importer claiming preferential treatment
for an article under § 10.215 must maintain in the United States, in accordance with the provisions of part 163 of
this chapter, all records relating to the
importation of the article. Those
records must include the original Certificate of Origin referred to in
§ 10.215(a) and any other relevant documents or other records as specified in
§ 163.1(a) of this chapter.
(b) Submission of Certificate. An importer who claims preferential treatment on a textile or apparel article
under § 10.215(a) must provide, at the
request of the port director, a copy of
the Certificate of Origin pertaining to
the article. A Certificate of Origin submitted to Customs under this paragraph:
(1) Must be in writing or must be
transmitted electronically pursuant to
any electronic data interchange system
authorized by Customs for that purpose;
(2) Must be signed by the exporter or
by the exporter’s authorized agent having knowledge of the relevant facts;
(3) Must be completed either in the
English language or in the language of
the country from which the article is
exported. If the Certificate is completed in a language other than
English, the importer must provide to
Customs upon request a written
English translation of the Certificate;
and
(4) May be applicable to:
(i) A single importation of an article
into the United States, including a single shipment that results in the filing
of one or more entries and a series of
shipments that results in the filing of
one entry; or

§ 10.216

(ii) Multiple importations of identical articles into the United States
that occur within a specified blanket
period, not to exceed 12 months, set out
in the Certificate by the exporter. For
purposes
of
this
paragraph
and
§ 10.214(c)(15), ‘‘identical articles’’ means
articles that are the same in all material respects, including physical characteristics, quality, and reputation.
(c) Correction and nonacceptance of
Certificate. If the port director determines that a Certificate of Origin is illegible or defective or has not been
completed in accordance with paragraph (b) of this section, the importer
will be given a period of not less than
five working days to submit a corrected Certificate. A Certificate will
not be accepted in connection with subsequent importations during a period
referred to in paragraph (b)(4)(ii) of
this section if the port director determined that a previously imported identical article covered by the Certificate
did not qualify for preferential treatment.
(d) Certificate not required—(1) General. Except as otherwise provided in
paragraph (d)(2) of this section, an importer is not required to have a Certificate of Origin in his possession for:
(i) An importation of an article for
which the port director has in writing
waived the requirement for a Certificate of Origin because the port director
is otherwise satisfied that the article
qualifies for preferential treatment;
(ii) A non-commercial importation of
an article; or
(iii) A commercial importation of an
article whose value does not exceed
US$2,500, provided that, unless waived
by the port director, the producer, exporter, importer or authorized agent
includes on, or attaches to, the invoice
or other document accompanying the
shipment the following signed statement:
I hereby certify that the article covered by
this shipment qualifies for preferential
treatment under the AGOA.
Check One:
( ) Producer
( ) Exporter
( ) Importer
( ) Agent
llllllllllllllllllllllll
Name
llllllllllllllllllllllll

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§ 10.217

19 CFR Ch. I (4–1–11 Edition)

Title
llllllllllllllllllllllll
Address
llllllllllllllllllllllll
Signature and Date

(2) Exception. If the port director determines that an importation described
in paragraph (d)(1) of this section forms
part of a series of importations that
may reasonably be considered to have
been undertaken or arranged for the
purpose of avoiding a Certificate of Origin
requirement
under
§§ 10.214
through 10.216, the port director will
notify the importer in writing that for
that importation the importer must
have in his possession a valid Certificate of Origin to support the claim for
preferential treatment. The importer
will have 30 calendar days from the
date of the written notice to obtain a
valid Certificate of Origin, and a failure to timely obtain the Certificate of
Origin will result in denial of the claim
for preferential treatment. For purposes of this paragraph, a ‘‘series of importations’’ means two or more entries
covering articles arriving on the same
day from the same exporter and consigned to the same person.
[T.D. 00–67, 65 FR 59676, Oct. 5, 2000, as
amended by T.D. 03–15, 68 FR 13827, Mar. 21,
2003]

§ 10.217 Verification and justification
of claim for preferential treatment.
(a) Verification by Customs. A claim
for preferential treatment made under
§ 10.215, including any statements or
other information contained on a Certificate of Origin submitted to Customs
under § 10.216, will be subject to whatever verification the port director
deems necessary. In the event that the
port director for any reason is prevented from verifying the claim, the
port director may deny the claim for
preferential treatment. A verification
of a claim for preferential treatment
may involve, but need not be limited
to, a review of:
(1) All records required to be made,
kept, and made available to Customs
by the importer or any other person
under part 163 of this chapter;
(2) Documentation and other information regarding the country of origin
of an article and its constituent materials, including, but not limited to,

production records, information relating to the place of production, the
number and identification of the types
of machinery used in production, and
the number of workers employed in
production; and
(3) Evidence to document the use of
U.S. materials in the production of the
article in question, such as purchase
orders, invoices, bills of lading and
other shipping documents, and customs
import and clearance documents.
(b) Importer requirements. In order to
make a claim for preferential treatment under § 10.215, the importer:
(1) Must have records that explain
how the importer came to the conclusion that the textile or apparel article
qualifies for preferential treatment.
Those records must include documents
that support a claim that the article in
question qualifies for preferential
treatment because it is specifically described in one of the provisions under
§ 10.213(a). If the importer is claiming
that the article incorporates fabric or
yarn that originated or was wholly
formed in the United States, the importer must have records that identify
the U.S. producer of the fabric or yarn.
A properly completed Certificate of Origin in the form set forth in § 10.214(b)
is a record that would serve these purposes;
(2) Must establish and implement internal controls which provide for the
periodic review of the accuracy of the
Certificate of Origin or other records
referred to in paragraph (b)(1) of this
section;
(3) Must have shipping papers that
show how the article moved from the
beneficiary country to the United
States. If the imported article was
shipped through a country other than a
beneficiary country and the invoices
and other documents from the beneficiary country do not show the United
States as the final destination, the importer also must have documentation
that demonstrates that the conditions
set forth in § 10.213(c)(3) (i) through (iii)
were met; and
(4) Must be prepared to explain, upon
request from Customs, how the records
and internal controls referred to in
paragraphs (b)(1) through (b)(3) of this

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U.S. Customs and Border Protection, DHS; Treasury
section justify the importer’s claim for
preferential treatment.
[T.D. 00–67, 65 FR 59676, Oct. 5, 2000, as
amended by T.D. 03–15, 68 FR 13827, Mar. 21,
2003]

Subpart E—United States-Caribbean Basin Trade Partnership
Act
TEXTILE AND APPAREL ARTICLES UNDER
THE UNITED STATES-CARIBBEAN BASIN
TRADE PARTNERSHIP ACT
SOURCE: T.D. 00–68, 65 FR 59658, Oct. 5, 2000,
unless otherwise noted.

§ 10.221

Applicability.

Title II of Public Law 106–200 (114
Stat. 251), entitled the United StatesCaribbean Basin Trade Partnership Act
(CBTPA), amended section 213(b) of the
Caribbean Basin Economic Recovery
Act (the CBERA, 19 U.S.C. 2701–2707) to
authorize the President to extend additional trade benefits to countries that
have been designated as beneficiary
countries under the CBERA. Section
213(b)(2) of the CBERA (19 U.S.C.
2703(b)(2)) provides for the preferential
treatment of certain textile and apparel articles from CBERA beneficiary
countries. The provisions of §§ 10.221–
10.227 of this part set forth the legal requirements and procedures that apply
for purposes of obtaining preferential
treatment pursuant to CBERA section
213(b)(2).
[T.D. 00–68, 65 FR 59658, Oct. 5, 2000; 65 FR
67262, Nov. 9, 2000]

§ 10.222

Definitions.

When used in §§ 10.221 through 10.228,
the following terms have the meanings
indicated:
Apparel articles. ‘‘Apparel articles’’
means goods classifiable in Chapters 61
and 62 and headings 6501, 6502, 6503, and
6504 and subheadings 6406.99 and 6505.90
of the HTSUS.
Assembled in one or more CBTPA beneficiary countries. ‘‘Assembled in one or
more CBTPA beneficiary countries’’
when used in the context of a textile or
apparel article has reference to a joining together of two or more components that occurred in one or more
CBTPA beneficiary countries, whether

§ 10.222

or not a prior joining operation was
performed on the article or any of its
components in the United States.
CBERA. ‘‘CBERA’’ means the Caribbean Basin Economic Recovery Act, 19
U.S.C. 2701–2707.
CBTPA beneficiary country. ‘‘CBTPA
beneficiary country’’ means a ‘‘beneficiary
country’’
as
defined
in
§ 10.191(b)(1) for purposes of the CBERA
which the President also has designated as a beneficiary country for
purposes of preferential treatment of
textile and apparel articles under 19
U.S.C. 2703(b)(2) and which has been the
subject of a finding by the President or
his designee, published in the FEDERAL
REGISTER, that the beneficiary country
has satisfied the requirements of 19
U.S.C. 2703(b)(4)(A)(ii).
Cut in one or more CBTPA beneficiary
countries. ‘‘Cut in one or more CBTPA
beneficiary countries’’ when used with
reference to apparel articles means
that all fabric components used in the
assembly of the article were cut from
fabric in one or more CBTPA beneficiary countries.
Foreign. ‘‘Foreign’’ means of a country
other than the United States or a
CBTPA beneficiary country.
HTSUS. ‘‘HTSUS’’ means the Harmonized Tariff Schedule of the United
States.
Knit-to-shape. The term ‘‘knit-toshape’’ applies to any apparel article of
which 50 percent or more of the exterior surface area is formed by major
parts that have been knitted or crocheted directly to the shape used in the
apparel article, with no consideration
being given to patch pockets, appliques, or the like. Minor cutting, trimming, or sewing of those major parts
will not affect the determination of
whether an apparel article is ‘‘knit-toshape.’’
Luggage. ‘‘Luggage’’ means travel
goods (such as trunks, hand trunks,
lockers, valises, satchels, suitcases,
wardrobe cases, overnight bags, pullman bags, gladstone bags, traveling
bags, knapsacks, kitbags, haversacks,
duffle bags, and like articles designed
to contain clothing or other personal
effects during travel) and brief cases,
portfolios, school bags, photographic
equipment bags, golf bags, camera

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§ 10.223

19 CFR Ch. I (4–1–11 Edition)

cases, binocular cases, gun cases, occupational luggage cases (for example,
physicians’ cases, sample cases), and
like containers and cases designed to
be carried with the person. The term
‘‘luggage’’ does not include handbags
(that is, pocketbooks, purses, shoulder
bags, clutch bags, and all similar articles, by whatever name known, customarily carried by women or girls).
The term ‘‘luggage’’ also does not include flat goods (that is, small flatware
designed to be carried on the person,
such as banknote cases, bill cases, billfolds, bill purses, bill rolls, card cases,
change cases, cigarette cases, coin
purses, coin holders, compacts, currency cases, key cases, letter cases, license cases, money cases, pass cases,
passport cases, powder cases, spectacle
cases, stamp cases, vanity cases, tobacco pouches, and similar articles).
Made in one or more CBTPA beneficiary countries. ‘‘Made in one or more
CBTPA beneficiary countries’’ when
used with reference to non-underwear
t-shirts means cut in one or more
CBTPA beneficiary countries and wholly assembled in one or more CBTPA
beneficiary countries.
Major parts. ‘‘Major parts’’ means integral components of an apparel article
but does not include collars, cuffs,
waistbands, plackets, pockets, linings,
paddings, trim, accessories, or similar
parts or components.
NAFTA. ‘‘NAFTA’’ means the North
American Free Trade Agreement entered into by the United States, Canada, and Mexico on December 17, 1992.
Preferential treatment. ‘‘Preferential
treatment’’ means entry, or withdrawal
from warehouse for consumption, in
the customs territory of the United
States free of duty and free of any
quantitative restrictions, limitations,
or consultation levels as provided in 19
U.S.C. 2703(b)(2).
Wholly assembled in one or more
CBTPA beneficiary countries. ‘‘Wholly
assembled in one or more CBTPA beneficiary countries’’ when used in the context of a textile or apparel article has
reference to a joining together of all
components (including thread, decorative embellishments, buttons, zippers,
or similar components) that occurred
only in one or more CBTPA beneficiary
countries.

Wholly formed. ‘‘Wholly formed,’’ when
used with reference to yarns, means
that all of the production processes,
starting with the extrusion of filament,
strip, film, or sheet and including slitting a film or sheet into strip or the
spinning of all fibers into yarn or both
and ending with a yarn or plied yarn,
took place in a single country, and,
when used with reference to fabric(s),
means that all of the production processes, starting with polymers, fibers,
filaments, textile strips, yarns, twine,
cordage, rope, or strips of fabric and
ending with a fabric by a weaving,
knitting, needling, tufting, felting, entangling or other process, took place in
a single country.
[T.D. 00–68, 65 FR 59658, Oct. 5, 2000; 65 FR
67262, Nov. 9, 2000; T.D. 01–74, 66 FR 50537,
Oct. 4, 2001, as amended by T.D. 03–12, 68 FR
13831, Mar. 21, 2003]

§ 10.223 Articles eligible for preferential treatment.
(a) General. The preferential treatment referred to in § 10.221 applies to
the following textile and apparel articles that are imported directly into the
customs territory of the United States
from a CBTPA beneficiary country:
(1) Apparel articles sewn or otherwise
assembled in one or more CBTPA beneficiary countries from fabrics wholly
formed and cut, or from components
knit-to-shape, in the United States,
from yarns wholly formed in the
United States (including fabrics not
formed from yarns, if those fabrics are
classifiable under heading 5602 or 5603
of the HTSUS and are wholly formed
and cut in the United States) that are
entered under subheading 9802.00.80 of
the HTSUS, and provided that any
other processing involving the article
conforms to the rules set forth in paragraph (b) of this section;
(2) Apparel articles sewn or otherwise
assembled in one or more CBTPA beneficiary countries from fabrics wholly
formed and cut, or from components
knit-to-shape, in the United States,
from yarns wholly formed in the
United States (including fabrics not
formed from yarns, if those fabrics are
classifiable under heading 5602 or 5603
of the HTSUS and are wholly formed
and cut in the United States) that are
entered under Chapter 61 or 62 of the

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U.S. Customs and Border Protection, DHS; Treasury
HTSUS, if, after that assembly, the articles would have qualified for entry
under subheading 9802.00.80 of the
HTSUS but for the fact that the articles were embroidered or subjected to
stone-washing, enzyme-washing, acid
washing, perma-pressing, oven-baking,
bleaching,
garment-dyeing,
screen
printing, or other similar processes in
a CBTPA beneficiary country, and provided that any other processing involving the article conforms to the rules
set forth in paragraph (b) of this section;
(3) Apparel articles sewn or otherwise
assembled in one or more CBTPA beneficiary countries with thread formed in
the United States from fabrics wholly
formed in the United States and cut in
one or more CBTPA beneficiary countries from yarns wholly formed in the
United States, or from components
knit-to-shape in the United States
from yarns wholly formed in the
United States, or both (including fabrics not formed from yarns, if those
fabrics are classifiable under heading
5602 or 5603 of the HTSUS and are wholly formed in the United States), and
provided that any other processing involving the article conforms to the
rules set forth in paragraph (b) of this
section;
(4) Apparel articles (other than socks
provided for in heading 6115 of the
HTSUS) knit to shape in a CBTPA beneficiary country from yarns wholly
formed in the United States, and knitted or crocheted apparel articles (other
than non-underwear t-shirts classifiable under subheadings 6109.10.00 and
6109.90.10 of the HTSUS and described
in paragraph (a)(5) of this section) cut
and wholly assembled in one or more
CBTPA beneficiary countries from fabrics formed in one or more CBTPA beneficiary countries or in one or more
CBTPA beneficiary countries and the
United States from yarns wholly
formed in the United States (including
fabrics not formed from yarns, if those
fabrics are classifiable under heading
5602 or 5603 of the HTSUS and are
formed in one or more CBTPA beneficiary countries);
(5) Non-underwear t-shirts, classifiable under subheadings 6109.10.00 and
6109.90.10 of the HTSUS, made in one or
more CBTPA beneficiary countries

§ 10.223

from fabric formed in one or more
CBTPA beneficiary countries from
yarns wholly formed in the United
States;
(6) Brassieres classifiable under subheading 6212.10 of the HTSUS, if both
cut and sewn or otherwise assembled in
the United States, or in one or more
CBTPA beneficiary countries, or in
both, other than articles entered as articles described in paragraphs (a)(1)
through
(a)(5),
paragraphs
(a)(7)
through (a)(9), or paragraph (a)(12), and
provided that any applicable additional
requirements set forth in § 10.228 are
met;
(7) Apparel articles, other than articles described in paragraph (a)(6) of
this section, that are both cut (or knitto-shape) and sewn or otherwise assembled in one or more CBTPA beneficiary
countries, from fabrics or yarn that is
not formed in the United States or in
one or more CBTPA beneficiary countries, to the extent that apparel articles of those fabrics or yarn would be
eligible for preferential treatment,
without regard to the source of the fabrics or yarn, under Annex 401 of the
NAFTA;
(8) Apparel articles that are both cut
(or knit-to-shape) and sewn or otherwise assembled in one or more CBTPA
beneficiary countries from fabrics or
yarn that the President or his designee
has designated in the FEDERAL REGISTER as not available in commercial
quantities in the United States;
(9) A handloomed, handmade, or folklore textile or apparel article of a
CBTPA beneficiary country that the
President or his designee and representatives of the CBTPA beneficiary
country
mutually
agree
is
a
handloomed, handmade, or folklore article and that is certified as a
handloomed, handmade, or folklore article by the competent authority of the
CBTPA beneficiary country;
(10) Textile luggage assembled in a
CBTPA beneficiary country from fabric
wholly formed and cut in the United
States, from yarns wholly formed in
the United States, that is entered
under subheading 9802.00.80 of the
HTSUS;
(11) Textile luggage assembled in a
CBTPA beneficiary country from fabric
cut in a CBTPA beneficiary country

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§ 10.223

19 CFR Ch. I (4–1–11 Edition)

from fabric wholly formed in the
United States from yarns wholly
formed in the United States;
(12) Knitted or crocheted apparel articles cut and assembled in one or more
CBTPA beneficiary countries from fabrics wholly formed in the United States
from yarns wholly formed in the
United States, or from components
knit-to-shape in the United States
from yarns wholly formed in the
United States, or both (including fabrics not formed from yarns, if those
fabrics are classifiable under heading
5602 or 5603 of the HTSUS and are
formed wholly in the United States),
provided that the assembly is with
thread formed in the United States,
and provided that any other processing
involving the article conforms to the
rules set forth in paragraph (b) of this
section; and
(13) Apparel articles sewn or otherwise assembled in one or more CBTPA
beneficiary countries with thread
formed in the United States:
(i) From components cut in the
United States and in one or more
CBTPA beneficiary countries from fabric wholly formed in the United States
from yarns wholly formed in the
United States (including fabrics not
formed from yarns, if those fabrics are
classifiable under heading 5602 or 5603
of the HTSUS);
(ii) From components knit-to-shape
in the United States and one or more
CBTPA beneficiary countries from
yarns wholly formed in the United
States; or
(iii) From any combination of two or
more of the cutting or knitting-toshape operations described in paragraph (a)(13)(i) or paragraph (a)(13)(ii)
of this section; and
(iv) Provided that any processing not
described in this paragraph (a)(13) conforms to the rules set forth in paragraph (b) of this section.
(b) Dyeing, printing, finishing and
other operations—(1) Dyeing, printing
and finishing operations. Dyeing, printing, and finishing operations may be
performed on any yarn, fabric, or knitto-shape or other component used in
the production of any article described
under paragraph (a) of this section
without affecting the eligibility of the
article for preferential treatment, pro-

vided that the operation is performed
in the United States or in a CBTPA
beneficiary country and not in any
other country and subject to the following additional conditions:
(i) In the case of an article described
in paragraph (a)(1), (a)(2), (a)(3), (a)(12),
or (a)(13) of this section that is entered
on or after September 1, 2002, and that
contains a knitted or crocheted or
woven fabric, or a knitted or crocheted
or woven fabric component produced
from fabric, that was wholly formed in
the United States from yarns wholly
formed in the United States, any dyeing, printing, or finishing of that knitted or crocheted or woven fabric or
component must have been carried out
in the United States; and
(ii) In the case of assembled luggage
described in paragraph (a)(10) of this
section, an operation may be performed
in a CBTPA beneficiary country only if
that operation is incidental to the assembly process within the meaning of
§ 10.16.
(2) Other operations. An article described under paragraph (a) of this section that is otherwise eligible for preferential treatment will not be disqualified from receiving that treatment by
virtue of having undergone one or more
operations
such
as
embroidering,
stone-washing, enzyme-washing, acid
washing, perma-pressing, oven-baking,
bleaching, garment-dyeing or screen
printing, provided that the operation is
performed in the United States or in a
CBTPA beneficiary country and not in
any other country. However, in the
case of assembled luggage described in
paragraph (a)(10) of this section, an operation may be performed in a CBTPA
beneficiary country without affecting
the eligibility of the article for preferential treatment only if it is incidental to the assembly process within
the meaning of § 10.16.
(c) Special rules for certain component
materials—(1) Foreign findings, trimmings, interlinings, fibers and yarns—(i)
General. An article otherwise described
under paragraph (a) of this section will
not be ineligible for the preferential
treatment referred to in § 10.221 because
the article contains:
(A) Findings and trimmings of foreign origin, if the value of those findings and trimmings does not exceed 25

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U.S. Customs and Border Protection, DHS; Treasury
percent of the cost of the components
of the assembled article. For purposes
of this section ‘‘findings and trimmings’’ include, but are not limited to,
hooks and eyes, snaps, buttons, ‘‘bow
buds,’’ decorative lace trim, elastic
strips (but only if they are each less
than 1 inch in width and are used in the
production of brassieres), zippers (including zipper tapes), labels, and sewing thread except in the case of an article described in paragraph (a)(3) or
(a)(12) of this section;
(B) Interlinings of foreign origin, if
the value of those interlinings does not
exceed 25 percent of the cost of the
components of the assembled article.
For purposes of this section ‘‘interlinings’’ include only a chest type
plate, a ‘‘hymo’’ piece, or ‘‘sleeve header,’’ of woven or weft-inserted warp
knit construction and of coarse animal
hair or man-made filaments;
(C) Any combination of findings and
trimmings of foreign origin and interlinings of foreign origin, if the total
value of those findings and trimmings
and interlinings does not exceed 25 percent of the cost of the components of
the assembled article; or
(D) Fibers or yarns not wholly
formed in the United States or in one
or more CBTPA beneficiary countries
if the total weight of all those fibers
and yarns is not more than 7 percent of
the total weight of the article, except
in the case of any apparel article described in paragraph (a)(1) through
(a)(5) or (a)(12) of this section containing elastomeric yarns which will be
eligible for preferential treatment only
if those yarns are wholly formed in the
United States.
(ii) ‘‘Cost’’ and ‘‘value’’ defined. The
‘‘cost’’ of components and the ‘‘value’’ of
findings and trimmings or interlinings
referred to in paragraph (c)(1)(i) of this
section means:
(A) The price of the components,
findings and trimmings, or interlinings
when last purchased, f.o.b. port of exportation, as set out in the invoice or
other commercial documents, or, if the
price is other than f.o.b. port of exportation:
(1) The price as set out in the invoice
or other commercial documents adjusted to arrive at an f.o.b. port of exportation price; or

§ 10.223

(2) If no exportation to a CBTPA beneficiary country is involved, the price
as set out in the invoice or other commercial documents, less the freight, insurance, packing, and other costs incurred in transporting the components,
findings and trimmings, or interlinings
to the place of production if included in
that price; or
(B) If the price cannot be determined
under paragraph (c)(1)(ii)(A) of this section or if Customs finds that price to
be unreasonable, all reasonable expenses incurred in the growth, production, manufacture, or other processing
of the components, findings and trimmings, or interlinings, including the
cost or value of materials and general
expenses, plus a reasonable amount for
profit, and the freight, insurance, packing, and other costs, if any, incurred in
transporting the components, findings
and trimmings, or interlinings to the
port of exportation.
(iii) Treatment of fibers and yarns as
findings or trimmings. If any fibers or
yarns not wholly formed in the United
States or one or more beneficiary countries are used in an article as a finding
or trimming described in paragraph
(c)(1)(i)(A) of this section, the fibers or
yarns will be considered to be a finding
or trimming for purposes of paragraph
(c)(1)(i) of this section.
(2) Special rule for nylon filament yarn.
An article otherwise described under
paragraph (a)(1), (a)(2), (a)(3) or (a)(12)
of this section will not be ineligible for
the preferential treatment referred to
in § 10.221 because the article contains
nylon filament yarn (other than elastomeric yarn) that is classifiable under
subheading
5402.10.30,
5402.10.60,
5402.31.30, 5402.31.60, 5402.32.30, 5402.32.60,
5402.41.10,
5402.41.90,
5402.51.00,
or
5402.61.00 of the HTSUS duty-free from
Canada, Mexico or Israel.
(3) Dyed, printed, or finished thread.
An article otherwise described under
paragraph (a) of this section will not be
ineligible for the preferential treatment referred to in § 10.221 because the
thread used to assemble the article is
dyed, printed, or finished in one or
more CBTPA beneficiary countries.
(d) Imported directly defined. For purposes of paragraph (a) of this section,
the words ‘‘imported directly’’ mean:

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§ 10.224

19 CFR Ch. I (4–1–11 Edition)

(1) Direct shipment from any CBTPA
beneficiary country to the United
States without passing through the
territory of any country that is not a
CBTPA beneficiary country;
(2) If the shipment is from any
CBTPA beneficiary country to the
United States through the territory of
any country that is not a CBTPA beneficiary country, the articles in the
shipment do not enter into the commerce of any country that is not a
CBTPA beneficiary country while en
route to the United States and the invoices, bills of lading, and other shipping documents show the United States
as the final destination; or
(3) If the shipment is from any
CBTPA beneficiary country to the
United States through the territory of
any country that is not a CBTPA beneficiary country, and the invoices and
other documents do not show the
United States as the final destination,
the articles in the shipment upon arrival in the United States are imported
directly only if they:
(i) Remained under the control of the
customs authority of the intermediate
country;
(ii) Did not enter into the commerce
of the intermediate country except for
the purpose of sale other than at retail,
and the port director is satisfied that
the importation results from the original commercial transaction between
the importer and the producer or the
producer’s sales agent; and

(iii) Were not subjected to operations
other than loading or unloading, and
other activities necessary to preserve
the articles in good condition.
[T.D. 00–68, 65 FR 59658, Oct. 5, 2000; 65 FR
67262, Nov. 9, 2000, as amended by T.D. 01–74,
66 FR 50537, Oct. 4, 2001; T.D. 03–12, 68 FR
13832, Mar. 21, 2003]

§ 10.224

Certificate of Origin.

(a) General. A Certificate of Origin
must be employed to certify that a textile or apparel article being exported
from a CBTPA beneficiary country to
the United States qualifies for the preferential treatment referred to in
§ 10.221. The Certificate of Origin must
be prepared by the exporter in the
CBTPA beneficiary country in the form
specified in paragraph (b) of this section. Where the CBTPA beneficiary
country exporter is not the producer of
the article, that exporter may complete and sign a Certificate of Origin on
the basis of:
(1) Its reasonable reliance on the producer’s written representation that the
article qualifies for preferential treatment; or
(2) A completed and signed Certificate of Origin for the article voluntarily provided to the exporter by the
producer.
(b) Form of Certificate. The Certificate
of Origin referred to in paragraph (a) of
this section must be in the following
format:

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U.S. Customs and Border Protection, DHS; Treasury

(c) Preparation of Certificate. The following rules will apply for purposes of
completing the Certificate of Origin set
forth in paragraph (b) of this section:
(1) Blocks 1 through 5 pertain only to
the final article exported to the United

§ 10.224

States for which preferential treatment may be claimed;
(2) Block 1 should state the legal
name and address (including country)
of the exporter;

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ER21MR03.002

195

§ 10.225

19 CFR Ch. I (4–1–11 Edition)

(3) Block 2 should state the legal
name and address (including country)
of the producer. If there is more than
one producer, attach a list stating the
legal name and address (including
country) of all additional producers. If
this information is confidential, it is
acceptable to state ‘‘available to Customs upon request’’ in block 2. If the
producer and the exporter are the
same, state ‘‘same’’ in block 2;
(4) Block 3 should state the legal
name and address (including country)
of the importer;
(5) In block 4, insert the letter that
designates the preference group which
applies to the article according to the
description contained in the CFR provision cited on the Certificate for that
group;
(6) Block 5 should provide a full description of each article. The description should be sufficient to relate it to
the invoice description and to the description of the article in the international Harmonized System. Include
the invoice number as shown on the
commercial invoice or, if the invoice
number is not known, include another
unique reference number such as the
shipping order number;
(7) Blocks 6 through 10 must be completed only when the block in question
calls for information that is relevant
to the preference group identified in
block 4;
(8) Block 6 should state the legal
name and address (including country)
of the fabric producer;
(9) Block 7 should state the legal
name and address (including country)
of the yarn producer;
(10) Block 8 should state the legal
name and address (including country)
of the thread producer;
(11) Block 9 should state the name of
the folklore article or should state that
the article is handloomed or handmade
of handloomed fabric;
(12) Block 10 should be completed if
the article described in block 5 incorporates a fabric or yarn described in
preference group G and should state
the name of the fabric or yarn that has
been considered as being in short supply in the NAFTA or that has been designated as not available in commercial
quantities in the United States;

(13) Block 11 must contain the signature of the exporter or of the exporter’s
authorized agent having knowledge of
the relevant facts;
(14) Block 15 should reflect the date
on which the Certificate was completed
and signed;
(15) Block 16 should be completed if
the Certificate is intended to cover
multiple shipments of identical articles as described in block 5 that are imported into the United States during a
specified period of up to one year (see
§ 10.226(b)(4)(ii)). The ‘‘from’’ date is the
date on which the Certificate became
applicable to the article covered by the
blanket Certificate (this date may be
prior to the date reflected in block 15).
The ‘‘to’’ date is the date on which the
blanket period expires; and
(16) The Certificate may be printed
and reproduced locally. If more space is
needed to complete the Certificate, attach a continuation sheet.
[T.D. 00–68, 65 FR 59658, Oct. 5, 2000; 65 FR
67263, Nov. 9, 2000, as amended by T.D. 03–12,
68 FR 13833, Mar. 21, 2003]

§ 10.225 Filing of claim for preferential
treatment.
(a) Declaration. In connection with a
claim for preferential treatment for a
textile or apparel article described in
§ 10.223, the importer must make a
written declaration that the article
qualifies for that treatment. The inclusion on the entry summary, or equivalent documentation, of the subheading
within Chapter 98 of the HTSUS under
which the article is classified will constitute the written declaration. Except
in any of the circumstances described
in § 10.226(d)(1), the declaration required under this paragraph must be
based on a Certificate of Origin that
has been completed and properly executed in accordance with § 10.224 and
that covers the article being imported.
(b) Corrected declaration. If, after
making the declaration required under
paragraph (a) of this section, the importer has reason to believe that a Certificate of Origin on which a declaration was based contains information
that is not correct, the importer must
within 30 calendar days after the date
of discovery of the error make a corrected declaration and pay any duties

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U.S. Customs and Border Protection, DHS; Treasury
that may be due. A corrected declaration will be effected by submission of a
letter or other written statement to
the Customs port where the declaration was originally filed.
[T.D. 00–68, 65 FR 59658, Oct. 5, 2000; 65 FR
67263, Nov. 9, 2000, as amended by T.D. 03–12,
68 FR 13835, Mar. 21, 2003]

§ 10.226 Maintenance of records and
submission of Certificate by importer.
(a) Maintenance of records. Each importer claiming preferential treatment
for an article under § 10.225 must maintain in the United States, in accordance with the provisions of part 163 of
this chapter, all records relating to the
importation of the article. Those
records must include the original Certificate of Origin referred to in
§ 10.225(a) and any other relevant documents or other records as specified in
§ 163.1(a) of this chapter.
(b) Submission of Certificate. An importer who claims preferential treatment on a textile or apparel article
under § 10.225(a) must provide, at the
request of the port director, a copy of
the Certificate of Origin pertaining to
the article. A Certificate of Origin submitted to Customs under this paragraph:
(1) Must be in writing or must be
transmitted electronically pursuant to
any electronic data interchange system
authorized by Customs for that purpose;
(2) Must be signed by the exporter or
by the exporter’s authorized agent having knowledge of the relevant facts;
(3) Must be completed either in the
English language or in the language of
the country from which the article is
exported. If the Certificate is completed in a language other than
English, the importer must provide to
Customs upon request a written
English translation of the Certificate;
and
(4) May be applicable to:
(i) A single importation of an article
into the United States, including a single shipment that results in the filing
of one or more entries and a series of
shipments that results in the filing of
one entry; or
(ii) Multiple importations of identical articles into the United States

§ 10.226

that occur within a specified blanket
period, not to exceed 12 months, set out
in the Certificate by the exporter. For
purposes
of
this
paragraph
and
§ 10.224(c)(15), ‘‘identical articles’’ means
articles that are the same in all material respects, including physical characteristics, quality, and reputation.
(c) Correction and nonacceptance of
Certificate. If the port director determines that a Certificate of Origin is illegible or defective or has not been
completed in accordance with paragraph (b) of this section, the importer
will be given a period of not less than
five working days to submit a corrected Certificate. A Certificate will
not be accepted in connection with subsequent importations during a period
referred to in paragraph (b)(4)(ii) of
this section if the port director determined that a previously imported identical article covered by the Certificate
did not qualify for preferential treatment.
(d) Certificate not required—(1) General. Except as otherwise provided in
paragraph (d)(2) of this section, an importer is not required to have a Certificate of Origin in his possession for:
(i) An importation of an article for
which the port director has in writing
waived the requirement for a Certificate of Origin because the port director
is otherwise satisfied that the article
qualifies for preferential treatment;
(ii) A non-commercial importation of
an article; or
(iii) A commercial importation of an
article whose value does not exceed US
$2,500, provided that, unless waived by
the port director, the producer, exporter, importer or authorized agent
includes on, or attaches to, the invoice
or other document accompanying the
shipment the following signed statement:
I hereby certify that the article covered by
this shipment qualifies for preferential
treatment under the CBTPA.
Check One:
( ) Producer
( ) Exporter
( ) Importer
( ) Agent
llllllllllllllllllllllll
Name
llllllllllllllllllllllll
Title

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§ 10.227

19 CFR Ch. I (4–1–11 Edition)

llllllllllllllllllllllll
Address
llllllllllllllllllllllll
Signature and Date

(2) Exception. If the port director determines that an importation described
in paragraph (d)(1) of this section forms
part of a series of importations that
may reasonably be considered to have
been undertaken or arranged for the
purpose of avoiding a Certificate of Origin
requirement
under
§§ 10.224
through 10.226, the port director will
notify the importer in writing that for
that importation the importer must
have in his possession a valid Certificate of Origin to support the claim for
preferential treatment. The importer
will have 30 calendar days from the
date of the written notice to obtain a
valid Certificate of Origin, and a failure to timely obtain the Certificate of
Origin will result in denial of the claim
for preferential treatment. For purposes of this paragraph, a ‘‘series of importations’’ means two or more entries
covering articles arriving on the same
day from the same exporter and consigned to the same person.
[T.D. 00–68, 65 FR 59658, Oct. 5, 2000, as
amended by T.D. 03–12, 68 FR 13835, Mar. 21,
2003]

§ 10.227 Verification and justification
of claim for preferential treatment.
(a) Verification by Customs. A claim
for preferential treatment made under
§ 10.225, including any statements or
other information contained on a Certificate of Origin submitted to Customs
under § 10.226, will be subject to whatever verification the port director
deems necessary. In the event that the
port director for any reason is prevented from verifying the claim, the
port director may deny the claim for
preferential treatment. A verification
of a claim for preferential treatment
may involve, but need not be limited
to, a review of:
(1) All records required to be made,
kept, and made available to Customs
by the importer or any other person
under part 163 of this chapter;
(2) Documentation and other information regarding the country of origin
of an article and its constituent materials, including, but not limited to,
production records, information relat-

ing to the place of production, the
number and identification of the types
of machinery used in production, and
the number of workers employed in
production; and
(3) Evidence to document the use of
U.S. materials in the production of the
article in question, such as purchase
orders, invoices, bills of lading and
other shipping documents, and customs
import and clearance documents.
(b) Importer requirements. In order to
make a claim for preferential treatment under § 10.225, the importer:
(1) Must have records that explain
how the importer came to the conclusion that the textile or apparel article
qualifies for preferential treatment.
Those records must include documents
that support a claim that the article in
question qualifies for preferential
treatment because it is specifically described in one of the provisions under
§ 10.223(a). If the importer is claiming
that the article incorporates fabric or
yarn that was wholly formed in the
United States, the importer must have
records that identify the U.S. producer
of the fabric or yarn. A properly completed Certificate of Origin in the form
set forth in § 10.224(b) is a record that
would serve these purposes;
(2) Must establish and implement internal controls which provide for the
periodic review of the accuracy of the
Certificates of Origin or other records
referred to in paragraph (b)(1) of this
section;
(3) Must have shipping papers that
show how the article moved from the
CBTPA beneficiary country to the
United States. If the imported article
was shipped through a country other
than a CBTPA beneficiary country and
the invoices and other documents from
the CBTPA beneficiary country do not
show the United States as the final
destination, the importer also must
have documentation that demonstrates
that the conditions set forth in
§ 10.223(d)(3)(i) through (iii) were met;
and
(4) Must be prepared to explain, upon
request from Customs, how the records
and internal controls referred to in
paragraphs (b)(1) through (b)(3) of this

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U.S. Customs and Border Protection, DHS; Treasury
section justify the importer’s claim for
preferential treatment.
[T.D. 00–68, 65 FR 59658, Oct. 5, 2000, as
amended by T.D. 03–12, 68 FR 13835, Mar. 21,
2003]

§ 10.228 Additional requirements for
preferential treatment of brassieres.
(a) Definitions. When used in this section, the following terms have the
meanings indicated:
(1) Producer. ‘‘Producer’’ means an individual, corporation, partnership, association, or other entity or group that
exercises direct, daily operational control over the production process in a
CBTPA beneficiary country.
(2) Entity controlling production. ‘‘Entity controlling production’’ means an
individual, corporation, partnership,
association, or other entity or group
that is not a producer and that controls the production process in a
CBTPA beneficiary country through a
contractual relationship or other indirect means.
(3) Fabrics formed in the United States.
‘‘Fabrics formed in the United States’’
means fabrics that were produced by a
weaving, knitting, needling, tufting,
felting, entangling or other fabricmaking process performed in the
United States.
(4) Cost. ‘‘Cost’’ when used with reference to fabrics formed in the United
States means:
(i) The price of the fabrics when last
purchased, f.o.b. port of exportation, as
set out in the invoice or other commercial documents, or, if the price is other
than f.o.b. port of exportation:
(A) The price as set out in the invoice
or other commercial documents adjusted to arrive at an f.o.b. port of exportation price; or
(B) If no exportation to a CBTPA
beneficiary country is involved, the
price as set out in the invoice or other
commercial
documents,
less
the
freight, insurance, packing, and other
costs incurred in transporting the fabrics to the place of production if included in that price; or
(ii) If the price cannot be determined
under paragraph (a)(4)(i) of this section
or if CBP finds that price to be unreasonable, all reasonable expenses incurred in the growth, production, man-

§ 10.228

ufacture, or other processing of the
fabrics, including the cost or value of
materials (which includes the cost of
non-recoverable scrap generated in
forming the fabrics) and general expenses, plus a reasonable amount for
profit, and the freight, insurance, packing, and other costs, if any, incurred in
transporting the fabrics to the port of
exportation.
(5) Declared customs value. ‘‘Declared
customs value’’ when used with reference to fabric contained in an article
means the sum of:
(i) The cost of fabrics formed in the
United States that the producer or entity controlling production can verify;
and
(ii) The cost of all other fabric contained in the article, exclusive of all
findings and trimmings, determined as
follows:
(A) In the case of fabric purchased by
the producer or entity controlling production, the f.o.b. port of exportation
price of the fabric as set out in the invoice or other commercial documents,
or, if the price is other than f.o.b. port
of exportation:
(1) The price as set out in the invoice
or other commercial documents adjusted to arrive at an f.o.b. port of exportation price, plus expenses for embroidering and dyeing, printing, and
finishing operations applied to the fabric if not included in that price; or
(2) If no exportation to a CBTPA beneficiary country is involved, the price
as set out in the invoice or other commercial documents, plus expenses for
embroidering and dyeing, printing, and
finishing operations applied to the fabric if not included in that price, but
less the freight, insurance, packing,
and other costs incurred in transporting the fabric to the place of production if included in that price;
(B) In the case of fabric for which the
cost cannot be determined under paragraph (a)(5)(ii)(A) of this section or if
CBP finds that cost to be unreasonable,
all reasonable expenses incurred in the
growth, production, or manufacture of
the fabric, including the cost or value
of materials (which includes the cost of
non-recoverable scrap generated in the
growth, production, or manufacture of
the fabric), general expenses and embroidering and dyeing, printing, and

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§ 10.228

19 CFR Ch. I (4–1–11 Edition)

finishing expenses, plus a reasonable
amount for profit, and the freight, insurance, packing, and other costs, if
any, incurred in transporting the fabric
to the port of exportation;
(C) In the case of fabric components
purchased by the producer or entity
controlling production, the f.o.b. port
of exportation price of those fabric
components as set out in the invoice or
other commercial documents, less the
cost or value of any non-textile materials, and less expenses for cutting or
other processing to create the fabric
components other than knitting to
shape, that the producer or entity controlling production can verify, or, if
the price is other than f.o.b. port of exportation:
(1) The price as set out in the invoice
or other commercial documents adjusted to arrive at an f.o.b. port of exportation price, less the cost or value
of any non-textile materials, and less
expenses for cutting or other processing to create the fabric components
other than knitting to shape, that the
producer or entity controlling production can verify; or
(2) If no exportation to a CBTPA beneficiary country is involved, the price
as set out in the invoice or other commercial documents, less the cost or
value of any non-textile materials, and
less expenses for cutting or other processing to create the fabric components
other than knitting to shape, that the
producer or entity controlling production can verify, and less the freight, insurance, packing, and other costs incurred in transporting the fabric components to the place of production if
included in that price; and
(D) In the case of fabric components
for which a fabric cost cannot be determined under paragraph (a)(5)(ii)(C) of
this section or if CBP finds that cost to
be unreasonable: all reasonable expenses incurred in the growth, production, or manufacture of the fabric components, including the cost or value of
materials (which does not include the
cost of recoverable scrap generated in
the growth, production, or manufacture of the fabric components) and general expenses, but excluding the cost or
value of any non-textile materials, and
excluding expenses for cutting or other
processing to create the fabric compo-

nents other than knitting to shape,
that the producer or entity controlling
production can verify, plus a reasonable amount for profit, and the freight,
insurance, packing, and other costs, if
any, incurred in transporting the fabric
components to the port of exportation.
(6) Year. ‘‘Year’’ means a 12-month period beginning on October 1 and ending
on September 30 but does not include
any 12-month period that began prior
to October 1, 2000.
(7) Entered. ‘‘Entered’’ means entered,
or withdrawn from warehouse for consumption, in the customs territory of
the United States.
(b) Limitations on preferential treatment—(1) General. During the year that
begins on October 1, 2002, and during
any subsequent year, articles of a producer or an entity controlling production that conform to the production
standards set forth in § 10.223(a)(6) will
be eligible for preferential treatment
only if:
(i) The aggregate cost of fabrics (exclusive of all findings and trimmings)
formed in the United States that were
used in the production of all of those
articles of that producer or that entity
controlling production that are entered
as articles described in § 10.223(a)(6)
during the immediately preceding year
was at least 75 percent of the aggregate
declared customs value of the fabric
(exclusive of all findings and trimmings) contained in all of those articles of that producer or that entity
controlling production that are entered
as articles described in § 10.223(a)(6)
during that year; or
(ii) In a case in which the 75 percent
requirement set forth in paragraph
(b)(1)(i) of this section was not met
during a year and therefore those articles of that producer or that entity
controlling production were not eligible for preferential treatment during
the following year, the aggregate cost
of fabrics (exclusive of all findings and
trimmings) formed in the United
States that were used in the production of all of those articles of that producer or that entity controlling production that conform to the production
standards set forth in § 10.223(a)(6) and
that were entered during the immediately preceding year was at least 85

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U.S. Customs and Border Protection, DHS; Treasury
percent of the aggregate declared customs value of the fabric (exclusive of
all findings and trimmings) contained
in all of those articles of that producer
or that entity controlling production
that conform to the production standards set forth in § 10.223(a)(6) and that
were entered during that year; and
(iii) In conjunction with the filing of
the claim for preferential treatment
under § 10.225, the importer records on
the entry summary or warehouse withdrawal for consumption (CBP Form
7501, column 34), or its electronic
equivalent, the distinct and unique
identifier assigned by CBP to the applicable documentation prescribed under
paragraph (c) of this section.
(2) Rules of application—(i) General.
For purposes of paragraphs (b)(1)(i) and
(b)(1)(ii) of this section and for purposes of preparing and filing the documentation prescribed in paragraph (c)
of this section, the following rules will
apply:
(A) The articles in question must
have been produced in the manner
specified in § 10.223(a)(6) and the articles in question must be entered within
the same year;
(B) Articles that are exported to
countries other than the United States
and are never entered are not to be
considered in determining compliance
with the 75 or 85 percent standard specified in paragraph (b)(1)(i) or paragraph
(b)(1)(ii) of this section;
(C) Articles that are entered under an
HTSUS subheading other than the
HTSUS subheading which pertains to
articles described in § 10.223(a)(6) are
not to be considered in determining
compliance with the 75 percent standard specified in paragraph (b)(1)(i) of
this section;
(D) For purposes of determining compliance with the 85 percent standard
specified in paragraph (b)(1)(ii) of this
section, all articles that conform to
the production standards set forth in
§ 10.223(a)(6) must be considered, regardless of the HTSUS subheading
under which they were entered;
(E) Fabric components and fabrics
that constitute findings or trimmings
are not to be considered in determining
compliance with the 75 or 85 percent
standard specified in paragraph (b)(1)(i)
or paragraph (b)(1)(ii) of this section;

§ 10.228

(F) Beginning October 1, 2002, in
order for articles to be eligible for preferential treatment in a given year, a
producer of, or entity controlling production of, those articles must have
met the 75 percent standard specified
in paragraph (b)(1)(i) of this section
during the immediately preceding
year. If articles of a producer or entity
controlling production fail to meet the
75 percent standard specified in paragraph (b)(1)(i) of this section during a
year, articles of that producer or entity controlling production:
(1) Will not be eligible for preferential treatment during the following year;
(2) Will remain ineligible for preferential treatment until the year that
follows a year in which articles of that
producer or entity controlling production met the 85 percent standard specified in paragraph (b)(1)(ii) of this section; and
(3) After the 85 percent standard
specified in paragraph (b)(1)(ii) of this
section has been met, will again be subject to the 75 percent standard specified in paragraph (b)(1)(i) of this section during the following year for purposes of determining eligibility for
preferential treatment in the next
year.
(G) A new producer or new entity
controlling production, that is, a producer or entity controlling production
which did not produce or control production of articles that were entered as
articles described in § 10.223(a)(6) during
the immediately preceding year, must
first establish compliance with the 85
percent standard specified in paragraph
(b)(1)(ii) of this section as a prerequisite to preparation of the declaration of compliance referred to in paragraph (c) of this section;
(H) A declaration of compliance prepared by a producer or by an entity
controlling production must cover all
production of that producer or all production that the entity controls for the
year in question;
(I) A producer is not required to prepare a declaration of compliance if all
of its production is covered by a declaration of compliance prepared by an
entity controlling production;

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§ 10.228

19 CFR Ch. I (4–1–11 Edition)

(J) In the case of a producer, the 75 or
85 percent standard specified in paragraph (b)(1)(i) or paragraph (b)(1)(ii) of
this section and the declaration of
compliance procedure under paragraph
(c) of this section apply to all articles
of that producer for the year in question, even if some but not all of that
production is also covered by a declaration of compliance prepared by an entity controlling production;
(K) The U.S. importer does not have
to be the producer or the entity controlling production who prepared the
declaration of compliance; and
(L) The exclusion references regarding findings and trimmings in paragraph (b)(1)(i) and paragraph (b)(1)(ii)
of this section apply to all findings and
trimmings, whether or not they are of
foreign origin.
(ii) Examples. The following examples
will illustrate application of the principles set forth in paragraph (b)(2)(i) of
this section.
Example 1. A CBTPA beneficiary country
producer of articles that meet the production standards specified in § 10.223(a)(6) in the
first year sends 50 percent of that production
to CBTPA region markets and the other 50
percent to the U.S. market; the cost of the
fabrics formed in the United States equals
100 percent of the value of all of the fabric in
the articles sent to the CBTPA region and 60
percent of the value of all of the fabric in the
articles sent to the United States. Although
the cost of fabrics formed in the United
States is more than 75 percent of the value of
all of the fabric used in all of the articles
produced, this producer could not prepare a
valid declaration of compliance because the
articles sent to the United States did not
meet the minimum 75 percent standard.
Example 2. A producer sends to the United
States in the first year three shipments of
articles that meet the description in
§ 10.223(a)(6); one of those shipments is entered under the HTSUS subheading that covers articles described in § 10.223(a)(6), the second shipment is entered under the HTSUS
subheading that covers articles described in
§ 10.223(a)(12), and the third shipment is entered under subheading 9802.00.80, HTSUS. In
determining whether the minimum 75 percent standard has been met in the first year
for purposes of entry of articles under the
HTSUS subheading that covers articles described in § 10.223(a)(6) during the following
(that is, second) year, consideration must be
restricted to the articles in the first shipment and therefore must not include the articles in the second and third shipments.

Example 3. A producer in the second year
begins production of articles that conform to
the production standards specified in
§ 10.223(a)(6); some of those articles are entered in that year under HTSUS subheading
6212.10 and others under HTSUS subheading
9802.00.80 but none are entered in that year
under the HTSUS subheading which pertains
to articles described in § 10.223(a)(6) because
the 75 percent standard had not been met in
the preceding (that is, first) year. In this
case the 85 percent standard applies, and all
of the articles that were entered under the
various HTSUS provisions in the second year
must be taken into account in determining
whether that 85 percent standard has been
met. If the 85 percent was met in the aggregate for all of the articles entered in the second year, in the next (that is, third) year articles of that producer may receive preferential treatment under the HTSUS subheading which pertains to articles described
in § 10.223(a)(6).
Example 4. An entity controlling production of articles that meet the description in
§ 10.223(a)(6) buys for the U.S., Canadian and
Mexican markets; the articles in each case
are first sent to the United States where
they are entered for consumption and then
placed in a commercial warehouse from
which they are shipped to various stores in
the United States, Canada and Mexico. Notwithstanding the fact that some of the articles ultimately ended up in Canada or Mexico, a declaration of compliance prepared by
the entity controlling production must cover
all of the articles rather than only those
that remained in the United States because
all of those articles had been entered for consumption.
Example 5. Fabric is cut and sewn in the
United States with other U.S. materials to
form cups which are joined together to form
brassiere front subassemblies in the United
States, and those front subassemblies are
then placed in a warehouse in the United
States where they are held until the following year; during that following year all of
the front subassemblies are shipped to a
CBTPA beneficiary country where they are
assembled with elastic strips and labels produced in an Asian country and other fabrics,
components or materials produced in the
CBTPA beneficiary country to form articles
that meet the production standards specified
in § 10.223(a)(6) and that are then shipped to
the United States and entered during that
same year. In determining whether the entered articles meet the minimum 75 or 85
percent standard, the fabric in the elastic
strips and labels is to be disregarded entirely
because the strips and labels constitute findings or trimmings for purposes of this section, and all of the fabric in the front subassemblies is countable because it was all
formed in the United States and used in the

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U.S. Customs and Border Protection, DHS; Treasury
production of articles that were entered in
the same year.
Example 6. A CBTPA beneficiary country
producer’s entire production of articles that
meet the description in § 10.223(a)(6) is sent
to a U.S. importer in two separate shipments, one in February and the other in
June of the same calendar year; the articles
shipped in February do not meet the minimum 75 percent standard, the articles
shipped in June exceed the 85 percent standard, and the articles in the two shipments,
taken together, do meet the 75 percent
standard; the articles covered by the February shipment are entered for consumption
on March 1 of that calendar year, and the articles covered by the June shipment are
placed in a CBP bonded warehouse upon arrival and are subsequently withdrawn from
warehouse for consumption on November 1 of
that calendar year. The CBTPA beneficiary
country producer may not prepare a valid
declaration of compliance covering the articles in the first shipment because those articles did not meet the minimum 75 percent
standard and because those articles cannot
be included with the articles of the second
shipment on the same declaration of compliance since they were entered in a different
year. However, the CBTPA beneficiary country producer may prepare a valid declaration
of compliance covering the articles in the
second shipment because those articles did
meet the requisite 85 percent standard which
would apply for purposes of entry of articles
in the following year.
Example 7. A producer in the second year
begins production of articles exclusively for
the U.S. market that meet the production
standards specified in § 10.223(a)(6), but the
entered articles do not meet the requisite 85
percent standard until the third year; the entered articles fail to meet the 75 percent
standard in the fourth year; and the entered
articles do not attain the 85 percent standard
until the sixth year. The producer’s articles
may not receive preferential treatment during the second year because there was no
production (and thus there were no entered
articles) in the immediately preceding (that
is, first) year on which to assess compliance
with the 75 percent standard. The producer’s
articles also may not receive preferential
treatment during the third year because the
85 percent standard was not met in the immediately preceding (that is, second) year.
However, the producer’s articles are eligible
for preferential treatment during the fourth
year based on compliance with the 85 percent
standard in the immediately preceding (that
is, third) year. The producer’s articles may
not receive preferential treatment during
the fifth year because the 75 percent standard was not met in the immediately preceding (that is, fourth) year. The producer’s
articles may not receive preferential treatment during the sixth year because the 85

§ 10.228

percent standard has become applicable and
was not met in the immediately preceding
(that is, fifth) year. The producer’s articles
are eligible for preferential treatment during
the seventh year because the 85 percent
standard was met in the immediately preceding (that is, sixth) year, and during that
seventh year the 75 percent standard is applicable for purposes of determining whether
the producer’s articles are eligible for preferential treatment in the following (that is,
eighth) year.
Example 8. An entity controlling production (Entity A) uses five CBTPA beneficiary
country producers (Producers 1–5), all of
which produce only articles that meet the
description in § 10.223(a)(6); Producers 1–4
send all of their production to the United
States and Producer 5 sends 10 percent of its
production to the United States and the rest
to Europe; Producers 1–3 and Producer 5
produce only pursuant to contracts with Entity A, but Producer 4 also operates independently of Entity A by producing for several U.S. importers, one of which is an entity
controlling production (Entity B) that also
controls all of the production of articles of
one other producer (Producer 6) which sends
all of its production to the United States. A
declaration of compliance prepared by Entity A must cover all of the articles of Producers 1–3 and the 10 percent of articles of
Producer 5 that are sent to the United States
and that portion of the articles of Producer
4 that are produced pursuant to the contract
with Entity A, because Entity A controls the
production of those articles. There is no need
for Producers 1–3 and Producer 5 to prepare
a declaration of compliance because they
have no production that is not covered by a
declaration of compliance prepared by an entity controlling production. A declaration of
compliance prepared by Producer 4 would
cover all of its production, that is, articles
produced for Entity A, articles produced for
Entity B, and articles produced independently for other U.S. importers; a declaration
of compliance prepared by Entity B must
cover that portion of the production of Producer 4 that it controls as well as all of the
production of Producer 6 because Entity B
also controls all of the production of Producer 6. Producer 6 would not prepare a declaration of compliance because all of its production is covered by the declaration of compliance prepared by Entity B.

(c) Documentation—(1) Initial declaration of compliance. In order for an importer to comply with the requirement
set forth in paragraph (b)(1)(iii) of this
section, the producer or the entity controlling production must have filed
with CBP, in accordance with paragraph (c)(4) of this section, a declaration of compliance with the applicable

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§ 10.228

19 CFR Ch. I (4–1–11 Edition)

75 or 85 percent requirement prescribed
in paragraph (b)(1)(i) or (b)(1)(ii) of this
section. After filing of the declaration
of compliance has been completed, CBP
will advise the producer or the entity
controlling production of the distinct
and unique identifier assigned to that
declaration. The producer or the entity
controlling production will then be responsible for advising each appropriate
U.S. importer of that distinct and
unique identifier for purposes of recording that identifier on the entry
summary or warehouse withdrawal. In
order to provide sufficient time for advising the U.S. importer of that distinct and unique identifier prior to the
arrival of the articles in the United
States, the producer or the entity controlling production should file the declaration of compliance with CBP at
least 10 calendar days prior to the date
of the first shipment of the articles to
the United States.
(2) Amended declaration of compliance.
If the information on the declaration of
compliance referred to in paragraph
(c)(1) of this section is based on an estimate because final year-end information was not available at that time and
the final data differs from the esti-

mate, or if the producer or the entity
controlling production has reason to
believe for any other reason that the
declaration of compliance that was
filed contained erroneous information,
within 30 calendar days after the final
year-end information becomes available or within 30 calendar days after
the date of discovery of the error:
(i) The producer or the entity controlling production must file with the
CBP office identified in paragraph
(c)(4) of this section an amended declaration of compliance containing that
final year-end information or other
corrected information; or
(ii) If that final year-end information
or other corrected information demonstrates noncompliance with the applicable 75 or 85 percent requirement,
the producer or the entity controlling
production must in writing advise both
the CBP office identified in paragraph
(c)(4) of this section and each appropriate U.S. importer of that fact.
(3) Form and preparation of declaration
of compliance—(i) Form. The declaration
of compliance referred to in paragraph
(c)(1) of this section may be printed
and reproduced locally and must be in
the following format:

CARIBBEAN BASIN TRADE PARTNERSHIP ACT DECLARATION OF COMPLIANCE FOR BRASSIERES
[19 CFR 10.223(a)(6) and 10.228]
1. Year beginning date: October 1, llll
Year ending date: September 30, llll

Official U.S. Customs and Border
Protection Use Only
Assigned number: lllll
Assignment date: lllll

2. Identity of preparer (producer or entity controlling production):
Full name and address:
Telephone number: lllll
Facsimile number: lllll
Importer identification number: lllll
3. If the preparer is an entity controlling production, provide the following for each producer:
Full name and address:
Telephone number: lllll
Facsimile number: lllll
4. Aggregate cost of fabrics (exclusive of all findings and trimmings) formed in the United States that were used in the production of brassieres that were entered during the year: lllll
5. Aggregate declared customs value of the fabric (exclusive of all findings and trimmings) contained in brassieres that were entered during the year: lllll
6. I declare that the aggregate cost of fabric (exclusive of all findings and trimmings) formed in the United States was at least
75 percent (or 85 percent, if applicable under 19 CFR 10.228(b)(1)(ii)) of the aggregate declared customs value of the fabric
contained in brassieres entered during the year.
7. Authorized signature:
8. Name and title (print or type):
lllllllll
Date:

(ii) Preparation. The following rules
will apply for purposes of completing
the declaration of compliance set forth
in paragraph (c)(3)(i) of this section:
(A) In block 1, fill in the year commencing October 1 and ending Sep-

tember 30 of the calendar year during
which the applicable 75 or 85 percent
standard specified in paragraph (b)(1)(i)
or paragraph (b)(1)(ii) of this section
was met;

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U.S. Customs and Border Protection, DHS; Treasury
(B) Block 2 should state the legal
name and address (including country)
of the preparer and should also include
the preparer’s importer identification
number (see § 24.5 of this chapter), if
the preparer has one;
(C) Block 3 should state the legal
name and address (including country)
of the CBTPA beneficiary country producer if that producer is not already
identified in block 2. If there is more
than one producer, attach a list stating
the legal name and address (including
country) of all additional producers;
(D) Blocks 4 and 5 apply only to articles that were entered during the year
identified in block 1; and
(E) In block 7, the signature must be
that of an authorized officer, employee,
agent or other person having knowledge of the relevant facts and the date
must be the date on which the declaration of compliance was completed and
signed.
(4) Filing of declaration of compliance.
The declaration of compliance referred
to in paragraph (c)(1) of this section:
(i) Must be completed either in the
English language or in the language of
the country in which the articles covered by the declaration were produced.
If the declaration is completed in a
language other than English, the producer or the entity controlling production must provide to CBP upon request
a written English translation of the
declaration; and
(ii) Must be filed with the New York
Strategic Trade Center, Customs and
Border Protection, 1 Penn Plaza, New
York, New York 10119.
(d) Verification of declaration of compliance—(1) Verification procedure. A declaration of compliance filed under this
section will be subject to whatever
verification CBP deems necessary. In
the event that CBP for any reason is
prevented from verifying the statements made on a declaration of compliance, CBP may deny any claim for
preferential treatment made under
§ 10.225 that is based on that declaration. A verification of a declaration of
compliance may involve, but need not
be limited to, a review of:
(i) All records required to be made,
kept, and made available to CBP by the
importer, the producer, the entity con-

§ 10.228

trolling production, or any other person under part 163 of this chapter;
(ii) Documentation and other information regarding all articles that meet
the production standards specified in
§ 10.223(a)(6) that were exported to the
United States and that were entered
during the year in question, whether or
not a claim for preferential treatment
was made under § 10.225. Those records
and other information include, but are
not limited to, work orders and other
production records, purchase orders,
invoices, bills of lading and other shipping documents;
(iii) Evidence to document the cost of
fabrics formed in the United States
that were used in the production of the
articles in question, such as purchase
orders, invoices, bills of lading and
other shipping documents, and customs
import and clearance documents, work
orders and other production records,
and inventory control records;
(iv) Evidence to document the cost or
value of all fabric other than fabrics
formed in the United States that were
used in the production of the articles
in question, such as purchase orders,
invoices, bills of lading and other shipping documents, and customs import
and clearance documents, work orders
and other production records, and inventory control records; and
(v) Accounting books and documents
to verify the records and information
referred to in paragraphs (d)(1)(ii)
through (d)(1)(iv) of this section. The
verification of purchase orders, invoices and bills of lading will be accomplished through the review of a distinct audit trail. The audit trail documents must consist of a cash disbursement or purchase journal or equivalent
records to establish the purchase of the
fabric. The headings in each of these
journals or other records must contain
the date, vendor name, and amount
paid for the fabric. The verification of
production records and work orders
will be accomplished through analysis
of the inventory records of the producer or entity controlling production.
The inventory records must reflect the
production of the finished article which
must be referenced to the original purchase order or lot number covering the
fabric used in production. In the inventory production records, the inventory

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§ 10.231

19 CFR Ch. I (4–1–11 Edition)

should show the opening balance of the
inventory plus the purchases made during the accounting period and the inventory closing balance.
(2) Notice of determination. If, based on
a verification of a declaration of compliance filed under this section, CBP
determines that the applicable 75 or 85
percent standard specified in paragraph
(b)(1)(i) or paragraph (b)(1)(ii) of this
section was not met, CBP will publish
a notice of that determination in the
FEDERAL REGISTER.
[CBP Dec. 04–40, 69 FR 69518, Nov. 30, 2004]

NON-TEXTILE ARTICLES UNDER THE
UNITED
STATES-CARIBBEAN
BASIN
TRADE PARTNERSHIP ACT
SOURCE: T.D. 00–68, 65 FR 59663, Oct. 5, 2000,
unless otherwise noted.

§ 10.231 Applicability.
Title II of Public Law 106–200 (114
Stat. 251), entitled the United StatesCaribbean Basin Trade Partnership Act
(CBTPA), amended section 213(b) of the
Caribbean Basin Economic Recovery
Act (the CBERA, 19 U.S.C. 2701–2707) to
authorize the President to extend additional trade benefits to countries that
have been designated as beneficiary
countries under the CBERA. Section
213(b)(3) of the CBERA (19 U.S.C.
2703(b)(3)) provides for special preferential tariff treatment of certain
non-textile articles that are otherwise
excluded from duty-free treatment
under the CBERA. The provisions of
§§ 10.231–10.237 of this part set forth the
legal requirements and procedures that
apply for purposes of obtaining preferential tariff treatment pursuant to
CBERA section 213(b)(3).
[T.D. 00–68, 65 FR 59663, Oct. 5, 2000; 65 FR
67263, Nov. 9, 2000]

§ 10.232 Definitions.
When used in §§ 10.231 through 10.237,
the following terms have the meanings
indicated:
CBERA. ‘‘CBERA’’ means the Caribbean Basin Economic Recovery Act, 19
U.S.C. 2701–2707.
CBTPA beneficiary country. ‘‘CBTPA
beneficiary country’’ means a ‘‘beneficiary
country’’
as
defined
in
§ 10.191(b)(1) for purposes of the CBERA
which the President also has des-

ignated as a beneficiary country for
purposes of preferential duty treatment of articles under 19 U.S.C.
2703(b)(3) and which has been the subject of a finding by the President or his
designee, published in the FEDERAL
REGISTER, that the beneficiary country
has satisfied the requirements of 19
U.S.C. 2703(b)(4)(A)(ii).
CBTPA originating good. ‘‘CBTPA
originating good’’ means a good that
meets the rules of origin for a good as
set forth in General Note 12, HTSUS,
and in the appendix to part 181 of this
chapter and as applied under § 10.233(b).
HTSUS. ‘‘HTSUS’’ means the Harmonized Tariff Schedule of the United
States.
NAFTA. ‘‘NAFTA’’ means the North
American Free Trade Agreement entered into by the United States, Canada, and Mexico on December 17, 1992.
Preferential tariff treatment. ‘‘Preferential tariff treatment’’ when used
with reference to an imported article
means entry, or withdrawal from warehouse for consumption, in the customs
territory of the United States with
duty and other tariff treatment that is
identical to the tariff treatment that
would be accorded at that time under
Annex 302.2 of the NAFTA to an imported article described in the same 8digit subheading of the HTSUS that is
a good of Mexico.
[T.D. 00–68, 65 FR 59663, Oct. 5, 2000; 65 FR
67264, Nov. 9, 2000]

§ 10.233 Articles eligible for preferential tariff treatment.
(a) General. The preferential tariff
treatment referred to in § 10.231 applies
to any of the following articles, provided that the article in question is a
CBTPA originating good, is imported
directly into the customs territory of
the United States from a CBTPA beneficiary country, and is not accorded
duty-free treatment under U.S. Note
2(b), Subchapter II, Chapter 98, HTSUS
(see § 10.26):
(1) Footwear not designated on August 5, 1983, as eligible articles for the
purpose of the Generalized System of
Preferences under Title V, Trade Act of
1974, as amended (19 U.S.C. 2461 through
2467);
(2) Tuna, prepared or preserved in
any manner, in airtight containers;

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U.S. Customs and Border Protection, DHS; Treasury
(3) Petroleum, or any product derived
from petroleum, provided for in headings 2709 and 2710 of the HTSUS;
(4) Watches and watch parts (including cases, bracelets, and straps), of
whatever type including, but not limited to, mechanical, quartz digital or
quartz analog, if those watches or
watch parts contain any material
which is the product of any country
with respect to which HTSUS column 2
rates of duty apply; and
(5) Articles to which reduced rates of
duty apply under § 10.198a, except as
otherwise provided in paragraph (c) of
this section.
(b) Application of NAFTA rules of origin. In determining whether an article
is a CBTPA originating good for purposes of paragraph (a) of this section,
application of the provisions of General
Note 12 of the HTSUS and the appendix
to part 181 of this chapter will be subject to the following rules:
(1) No country other than the United
States and a CBTPA beneficiary country may be treated as being a party to
the NAFTA;
(2) Any reference to trade between
the United States and Mexico will be
deemed to refer to trade between the
United States and a CBTPA beneficiary
country;
(3) Any reference to a party will be
deemed to refer to a CBTPA beneficiary country or the United States;
and
(4) Any reference to parties will be
deemed to refer to any combination of
CBTPA beneficiary countries or to the
United States and one or more CBTPA
beneficiary countries (or any combination involving the United States and
CBTPA beneficiary countries).
(c) Duty reductions for leather-related
articles. If, after it is determined that
an article described in paragraph (a)(5)
of this section qualifies as a CBTPA
originating good and is eligible for
preferential tariff treatment under this
section, it is determined that the article in question also would otherwise
qualify for a reduced rate of duty under
§ 10.198a and that reduced rate of duty
is lower than the rate of duty that
would apply under this section, that
lower rate of duty will apply to the article for purposes of preferential tariff
treatment under this section.

§ 10.234

(d) Imported directly defined. For purposes of paragraph (a) of this section,
the words ‘‘imported directly’’ mean:
(1) Direct shipment from any CBTPA
beneficiary country to the United
States without passing through the
territory of any country that is not a
CBTPA beneficiary country;
(2) If the shipment is from any
CBTPA beneficiary country to the
United States through the territory of
any country that is not a CBTPA beneficiary country, the articles in the
shipment do not enter into the commerce of any country that is not a
CBTPA beneficiary country while en
route to the United States and the invoices, bills of lading, and other shipping documents show the United States
as the final destination; or
(3) If the shipment is from any
CBTPA beneficiary country to the
United States through the territory of
any country that is not a CBTPA beneficiary country, and the invoices and
other documents do not show the
United States as the final destination,
the articles in the shipment upon arrival in the United States are imported
directly only if they:
(i) Remained under the control of the
customs authority of the intermediate
country;
(ii) Did not enter into the commerce
of the intermediate country except for
the purpose of sale other than at retail,
and the port director is satisfied that
the importation results from the original commercial transaction between
the importer and the producer or the
producer’s sales agent; and
(iii) Were not subjected to operations
other than loading or unloading, and
other activities necessary to preserve
the articles in good condition.
§ 10.234

Certificate of Origin.

A Certificate of Origin as specified in
§ 10.236 must be employed to certify
that an article described in § 10.233(a)(1)
through (5) being exported from a
CBTPA beneficiary country to the
United States qualifies for the preferential tariff treatment referred to in
§ 10.231. The Certificate of Origin must
be prepared by the exporter in the
CBTPA beneficiary country. Where the
CBTPA beneficiary country exporter is

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§ 10.235

19 CFR Ch. I (4–1–11 Edition)

not the producer of the article, that exporter may complete and sign a Certificate of Origin on the basis of:
(a) Its reasonable reliance on the producer’s written representation that the
article qualifies for preferential tariff
treatment; or
(b) A completed and signed Certificate of Origin for the article voluntarily provided to the exporter by the
producer.
§ 10.235 Filing of claim for preferential
tariff treatment.
(a) Declaration. In connection with a
claim for preferential tariff treatment
for an article described in § 10.233(a)(1)
through (5), the importer must make a
written declaration that the article
qualifies for that treatment. The written declaration should be made by including on the entry summary, or
equivalent documentation, the symbol
‘‘R’’ as a prefix to the subheading of the
HTSUS under which the article in
question is classified. Except in any of
the
circumstances
described
in
§ 10.236(d)(1), the declaration required
under this paragraph must be based on
a complete and properly executed
original Certificate of Origin that covers the article being imported and that
is in the possession of the importer.
(b) Corrected declaration. If, after
making the declaration required under
paragraph (a) of this section, the importer has reason to believe that a Certificate of Origin on which a declaration was based contains information
that is not correct, the importer must
within 30 calendar days after the date
of discovery of the error make a corrected declaration and pay any duties
that may be due. A corrected declaration will be effected by submission of a
letter or other written statement to
the Customs port where the declaration was originally filed.
§ 10.236 Maintenance of records and
submission of Certificate by importer.
(a) Maintenance of records. Each importer claiming preferential tariff
treatment for an article under § 10.235
must maintain in the United States, in
accordance with the provisions of part
163 of this chapter, all records relating
to the importation of the article. Those

records must include the original Certificate of Origin referred to in
§ 10.235(a) and any other relevant documents or other records as specified in
§ 163.1(a) of this chapter.
(b) Submission of Certificate. An importer who claims preferential tariff
treatment
on
an
article
under
§ 10.235(a) must provide, at the request
of the port director, a copy of the Certificate of Origin pertaining to the article. A Certificate of Origin submitted
to CBP under this paragraph:
(1) Must be on CBP Form 450, including privately-printed copies of that
Form, or, as an alternative to CBP
Form 450, in an approved computerized
format or other medium or format as is
approved by the Office of International
Trade, U.S. Customs and Border Protection, Washington, DC 20229. An alternative format must contain the
same information and certification set
forth on CBP Form 450;
(2) Must be signed by the exporter or
by the exporter’s authorized agent having knowledge of the relevant facts;
(3) Must be completed either in the
English language or in the language of
the country from which the article is
exported. If the Certificate is completed in a language other than
English, the importer must provide to
Customs upon request a written
English translation of the Certificate;
and
(4) May be applicable to:
(i) A single importation of an article
into the United States, including a single shipment that results in the filing
of one or more entries and a series of
shipments that results in the filing of
one entry; or
(ii) Multiple importations of identical articles into the United States
that occur within a specified period,
not to exceed 12 months, set out in the
Certificate by the exporter.
(c) Correction and nonacceptance of
Certificate. If the port director determines that a Certificate of Origin is illegible or defective or has not been
completed in accordance with paragraph (b) of this section, the importer
will be given a period of not less than
five working days to submit a corrected Certificate. A Certificate will
not be accepted in connection with subsequent importations during a period

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U.S. Customs and Border Protection, DHS; Treasury
referred to in paragraph (b)(4)(ii) of
this section if the port director determined that a previously imported identical article covered by the Certificate
did not qualify for preferential treatment.
(d) Certificate not required—(1) General. Except as otherwise provided in
paragraph (d)(2) of this section, an importer is not required to have a Certificate of Origin in his possession for:
(i) An importation of an article for
which the port director has in writing
waived the requirement for a Certificate of Origin because the port director
is otherwise satisfied that the article
qualifies for preferential tariff treatment;
(ii) A non-commercial importation of
an article; or
(iii) A commercial importation of an
article whose value does not exceed
US$2,500, provided that, unless waived
by the port director, the producer, exporter, importer or authorized agent
includes on, or attaches to, the invoice
or other document accompanying the
shipment the following signed statement:
I hereby certify that the article covered by
this shipment qualifies for preferential tariff
treatment under the CBTPA.
Check One:
( ) Producer
( ) Exporter
( ) Importer
( ) Agent
llllllllllllllllllllllll
Name
llllllllllllllllllllllll
Title
llllllllllllllllllllllll
Address
llllllllllllllllllllllll
Signature and Date

(2) Exception. If the port director determines that an importation described
in paragraph (d)(1) of this section forms
part of a series of importations that
may reasonably be considered to have
been undertaken or arranged for the
purpose of avoiding a Certificate of Origin
requirement
under
§§ 10.234
through 10.236, the port director will
notify the importer in writing that for
that importation the importer must
have in his possession a valid Certificate of Origin to support the claim for
preferential tariff treatment. The importer will have 30 calendar days from

§ 10.237

the date of the written notice to obtain
a valid Certificate of Origin, and a failure to timely obtain the Certificate of
Origin will result in denial of the claim
for preferential tariff treatment. For
purposes of this paragraph, a ‘‘series of
importations’’ means two or more entries covering articles arriving on the
same day from the same exporter and
consigned to the same person.
§ 10.237 Verification and justification
of claim for preferential tariff treatment.
(a) Verification by Customs. A claim
for preferential tariff treatment made
under § 10.235, including any statements
or other information contained on a
Certificate of Origin submitted to Customs under § 10.236, will be subject to
whatever verification the port director
deems necessary. In the event that the
port director for any reason is prevented from verifying the claim, the
port director may deny the claim for
preferential
tariff
treatment.
A
verification of a claim for preferential
tariff treatment may involve, but need
not be limited to, a review of:
(1) All records required to be made,
kept, and made available to Customs
by the importer or any other person
under part 163 of this chapter;
(2) Documentation and other information in a CBTPA beneficiary country regarding the country of origin of
an article and its constituent materials, including, but not limited to,
production records, information relating to the place of production, the
number and identification of the types
of machinery used in production, and
the number of workers employed in
production; and
(3) Evidence in a CBTPA beneficiary
country to document the use of U.S.
materials in the production of the article in question, such as purchase orders, invoices, bills of lading and other
shipping documents, and customs import and clearance documents.
(b) Importer requirements. In order to
make a claim for preferential tariff
treatment under § 10.235, the importer:
(1) Must have records that explain
how the importer came to the conclusion that the article qualifies for preferential
tariff
treatment.
Those
records must include documents that

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§ 10.241

19 CFR Ch. I (4–1–11 Edition)

support a claim that the article in
question qualifies for preferential tariff
treatment because it meets the applicable rule of origin set forth in General
Note 12, HTSUS, and in the appendix to
part 181 of this chapter. A properly
completed Certificate of Origin in the
form prescribed in § 10.236(b) is a record
that would serve this purpose;
(2) Must establish and implement internal controls which provide for the
periodic review of the accuracy of the
Certificate of Origin or other records
referred to in paragraph (b)(1) of this
section;
(3) Must have shipping papers that
show how the article moved from the
CBTPA beneficiary country to the
United States. If the imported article
was shipped through a country other
than a CBTPA beneficiary country and
the invoices and other documents from
the CBTPA beneficiary country do not
show the United States as the final
destination, the importer also must
have documentation that demonstrates
that the conditions set forth in
§ 10.233(d)(3)(i) through (iii) were met;
and
(4) Must be prepared to explain, upon
request from Customs, how the records
and internal controls referred to in
paragraphs (b)(1) through (b)(3) of this
section justify the importer’s claim for
preferential tariff treatment.

Subpart F—Andean Trade Promotion and Drug Eradication
Act
APPAREL AND OTHER TEXTILE ARTICLES
UNDER THE ANDEAN TRADE PROMOTION
AND DRUG ERADICATION ACT
SOURCE: Sections 10.241 through 10.248
issued by CBP Dec. 06–21, 71 FR 44574, Aug. 7,
2006, unless otherwise noted.

§ 10.241 Applicability.
Title XXXI of Public Law 107–210 (116
Stat. 933), entitled the Andean Trade
Promotion and Drug Eradication Act
(ATPDEA), amended sections 202, 203,
204, and 208 of the Andean Trade Preference Act (the ATPA, 19 U.S.C. 3201–
3206) to authorize the President to extend additional trade benefits to countries that are designated as beneficiary
countries under the ATPA. Section

204(b)(3) of the ATPA (19 U.S.C.
3203(b)(3)) provides for the preferential
treatment of certain apparel and other
textile articles from those ATPA beneficiary countries which the President
designates as ATPDEA beneficiary
countries. The provisions of §§ 10.241
through 10.248 of this part set forth the
legal requirements and procedures that
apply for purposes of obtaining preferential treatment pursuant to ATPA
section 204(b)(3) and Subchapter XXI,
Chapter 98, HTSUS.
§ 10.242

Definitions.

When used in §§ 10.241 through 10.248,
the following terms have the meanings
indicated:
Apparel articles. ‘‘Apparel articles’’
means goods classifiable in Chapters 61
and 62 and headings 6501, 6502, 6503, and
6504 and subheadings 6406.99.15 and
6505.90 of the HTSUS.
Assembled or sewn or otherwise assembled in one or more ATPDEA beneficiary
countries. ‘‘Assembled’’ and ‘‘sewn or
otherwise assembled’’ when used in the
context of production of an apparel or
other textile article in one or more
ATPDEA beneficiary countries has reference to a joining together of two or
more components that occurred in one
or more ATPDEA beneficiary countries, whether or not a prior joining operation was performed on the article or
any of its components in the United
States.
ATPA. ‘‘ATPA’’ means the Andean
Trade Preference Act, 19 U.S.C. 3201–
3206.
ATPDEA
beneficiary
country.
‘‘ATPDEA beneficiary country’’ means
a ‘‘beneficiary country’’ as defined in
§ 10.202(a) for purposes of the ATPA
which the President also has designated as a beneficiary country for
purposes of preferential treatment of
apparel and other textile articles under
19 U.S.C. 3203(b)(3) and which has been
the subject of a determination by the
President or his designee, published in
the FEDERAL REGISTER, that the beneficiary country has satisfied the requirements of 19 U.S.C. 3203(b)(5)(A)(ii).
Chief value. ‘‘Chief value’’ when used
with reference to llama, alpaca, and
˜ a means that the value of those
vicun
materials exceeds the value of any

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U.S. Customs and Border Protection, DHS; Treasury
other single textile material in the fabric or component under consideration,
with the value in each case determined
by application of the principles set
forth in § 10.243(c)(1)(ii).
Cut in one or more ATPDEA beneficiary
countries. ‘‘Cut’’ when used in the context of production of textile luggage in
one or more ATPDEA beneficiary countries means that all fabric components
used in the assembly of the article
were cut from fabric in one or more
ATPDEA beneficiary countries, or were
cut from fabric in the United States
and used in a partial assembly operation in the United States prior to cutting of fabric and assembly of the article in one or more ATPDEA beneficiary
countries, or both.
Foreign
origin.
‘‘Foreign
origin’’
means, in the case of a finding or trimming of non-textile materials, that the
finding or trimming is a product of a
country other than the United States
or a ATPDEA beneficiary country and,
in the case of a finding, trimming, or
interlining of textile materials, that
the finding, trimming, or interlining
does not meet all of the U.S. and
ATPDEA beneficiary country production requirements for yarns, fabrics,
and/or components specified under
§ 10.243(a) for the article in which it is
incorporated.
HTSUS. ‘‘HTSUS’’means the Harmonized Tariff Schedule of the United
States.
Knit-to-Shape Components. ‘‘Knit-toshape,’’ when used with reference to
textile components, means components
that are knitted or crocheted from a
yarn directly to a specific shape, that
is, the shape or form of the component
as it is used in the apparel article, containing at least one self-start edge.
Minor cutting or trimming will not affect the determination of whether a
component is ‘‘knit-to-shape.’’
Luggage. ‘‘Luggage’’ means travel
goods (such as trunks, hand trunks,
lockers, valises, satchels, suitcases,
wardrobe cases, overnight bags, pullman bags, gladstone bags, traveling
bags, knapsacks, kitbags, haversacks,
duffle bags, and like articles designed
to contain clothing or other personal
effects during travel) and brief cases,
portfolios, school bags, photographic
equipment bags, golf bags, camera

§ 10.242

cases, binocular cases, gun cases, occupational luggage cases (for example,
physicians’ cases, sample cases), and
like containers and cases designed to
be carried with the person. The term
‘‘luggage’’ does not include handbags
(that is, pocketbooks, purses, shoulder
bags, clutch bags, and all similar articles, by whatever name known, customarily carried by women or girls).
The term ‘‘luggage’’ also does not include flat goods (that is, small flatware
designed to be carried on the person,
such as banknote cases, bill cases, billfolds, bill purses, bill rolls, card cases,
change cases, cigarette cases, coin
purses, coin holders, compacts, currency cases, key cases, letter cases, license cases, money cases, pass cases,
passport cases, powder cases, spectacle
cases, stamp cases, vanity cases, tobacco pouches, and similar articles).
NAFTA. ‘‘NAFTA’’ means the North
American Free Trade Agreement entered into by the United States, Canada, and Mexico on December 17, 1992.
Preferential treatment. ‘‘Preferential
treatment’’ means entry, or withdrawal
from warehouse for consumption, in
the customs territory of the United
States free of duty and free of any
quantitative restrictions, limitations,
or consultation levels as provided in 19
U.S.C. 3203(b)(3).
Self-start edge. ‘‘Self-start edge’’ when
used with reference to knit-to-shape
components means a finished edge
which is finished as the component
comes off the knitting machine. Several components with finished edges
may be linked by yarn or thread as
they are produced from the knitting
machine.
Wholly formed fabric components.
‘‘Wholly formed,’’ when used with reference to fabric components, means
that all of the production processes,
starting with the production of wholly
formed fabric and ending with a component that is ready for incorporation
into an apparel article, took place in a
single country.
Wholly
formed
fabrics.
‘‘Wholly
formed,’’ when used with reference to
fabric(s), means that all of the production processes, starting with polymers,
fibers, filaments, textile strips, yarns,
twine, cordage, rope, or strips of fabric
and ending with a fabric by a weaving,

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§ 10.243

19 CFR Ch. I (4–1–11 Edition)

knitting, needling, tufting, felting, entangling or other process, took place in
a single country.
Wholly formed yarns. ‘‘Wholly formed,’’
when used with reference to yarns,
means that all of the production processes, starting with the extrusion of
filament, strip, film, or sheet and including drawing to fully orient a filament or slitting a film or sheet into
strip, or the spinning of all fibers into
yarn, or both, and ending with a yarn
or plied yarn, took place in the United
States or in one or more ATPDEA beneficiary countries.
§ 10.243 Articles eligible for preferential treatment.
(a) General. Subject to paragraphs (b)
and (c) of this section, preferential
treatment applies to the following apparel and other textile articles that are
imported directly into the customs territory of the United States from an
ATPDEA beneficiary country:
(1) Apparel articles sewn or otherwise
assembled in one or more ATPDEA
beneficiary countries, or in the United
States, or in both, exclusively from
any one of the following:
(i) Fabrics or fabric components
wholly formed, or components knit-toshape, in the United States, from yarns
wholly formed in the United States or
in one or more ATPDEA beneficiary
countries (including fabrics not formed
from yarns, if those fabrics are classifiable under heading 5602 or 5603 of the
HTSUS and are formed in the United
States), provided that, if the apparel
article is assembled from knitted or
crocheted or woven wholly formed fabrics or from knitted or crocheted or
woven wholly formed fabric components produced from fabric, all dyeing,
printing, and finishing of that knitted
or crocheted or woven fabric or component was carried out in the United
States;
(ii) Fabrics or fabric components
formed, or components knit-to-shape,
in one or more ATPDEA beneficiary
countries from yarns wholly formed in
one or more ATPDEA beneficiary countries, if those fabrics (including fabrics
not formed from yarns, if those fabrics
are classifiable under heading 5602 or
5603 of the HTSUS and are formed in
one or more ATPDEA beneficiary coun-

tries) or components are in chief value
˜ a;
of llama, alpaca, and/or vicun
(iii) Fabrics or yarns, provided that
apparel articles (except articles classifiable under subheading 6212.10 of the
HTSUS) of those fabrics or yarns would
be considered an originating good
under General Note 12(t), HTSUS, if
the apparel articles had been imported
directly from Canada or Mexico; or
(iv) Fabrics or yarns that the President or his designee has designated in
the FEDERAL REGISTER as fabrics or
yarns that cannot be supplied by the
domestic industry in commercial quantities in a timely manner;
(2) Apparel articles sewn or otherwise
assembled in one or more ATPDEA
beneficiary countries, or in the United
States, or in both, exclusively from a
combination of fabrics, fabric components, knit-to-shape components or
yarns described in two or more of paragraphs (a)(1)(i) through (a)(1)(iv) of this
section;
(3) A handloomed, handmade, or folklore apparel or other textile article of
an ATPDEA beneficiary country that
the President or his designee and representatives of the ATPDEA beneficiary country mutually agree is a
handloomed, handmade, or folklore article and that is certified as a
handloomed, handmade, or folklore article by the competent authority of the
ATPDEA beneficiary country;
(4) Brassieres classifiable under subheading 6212.10 of the HTSUS, if both
cut and sewn or otherwise assembled in
the United States, or in one or more
ATPDEA beneficiary countries, or in
both, other than articles entered as articles described in paragraphs (a)(1)
through (a)(3) and (a)(7) of this section,
and provided that any applicable additional requirements set forth in § 10.248
are met;
(5) Textile luggage assembled in an
ATPDEA beneficiary country from fabric wholly formed and cut in the
United States, from yarns wholly
formed in the United States, that is entered under subheading 9802.00.80 of the
HTSUS;
(6) Textile luggage assembled in one
or more ATPDEA beneficiary countries
from fabric cut in one or more
ATPDEA beneficiary countries from
fabric wholly formed in the United

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U.S. Customs and Border Protection, DHS; Treasury
States from yarns wholly formed in the
United States; and
(7) Apparel articles sewn or otherwise
assembled in one or more ATPDEA
beneficiary countries from fabrics or
from fabric components formed, or
from components knit-to-shape, in one
or more ATPDEA beneficiary countries
from yarns wholly formed in the
United States or in one or more
ATPDEA beneficiary countries (including fabrics not formed from yarns, if
those fabrics are classifiable under
heading 5602 or 5603 of the HTSUS and
are formed in one or more ATPDEA
beneficiary countries), including apparel articles sewn or otherwise assembled in part but not exclusively from
any of the fabrics, fabric components
formed, or components knit-to-shape
described in paragraph (a)(1) of this
section.
(b) Dyeing, printing, finishing and
other operations—(1) Dyeing, printing
and finishing operations. Dyeing, printing, and finishing operations may be
performed on any yarn, fabric, or knitto-shape or other component used in
the production of any article described
under paragraph (a) of this section
without affecting the eligibility of the
article for preferential treatment, provided that the operation is performed
in the United States or in an ATPDEA
beneficiary country and not in any
other country and subject to the following additional conditions:
(i) In the case of an article described
in paragraph (a)(1), (a)(2), or (a)(7) of
this section that contains a knitted or
crocheted or woven fabric, or a knitted
or crocheted or woven fabric component produced from fabric, that was
wholly formed in the United States
from yarns wholly formed in the
United States or in one or more
ATPDEA beneficiary countries, as described in paragraph (a)(1)(i) of this
section, any dyeing, printing, or finishing of that knitted or crocheted or
woven fabric or component must have
been carried out in the United States;
and
(ii) In the case of assembled luggage
described in paragraph (a)(5) of this
section, an operation may be performed
in an ATPDEA beneficiary country
only if that operation is incidental to

§ 10.243

the assembly process within the meaning of § 10.16.
(2) Other operations. An article described under paragraph (a) of this section that is otherwise eligible for preferential treatment will not be disqualified from receiving that treatment by
virtue of having undergone one or more
operations
such
as
embroidering,
stone-washing, enzyme-washing, acid
washing, perma-pressing, oven-baking,
bleaching, garment-dyeing or screen
printing, provided that the operation is
performed in the United States or in an
ATPDEA beneficiary country and not
in any other country. However, in the
case of assembled luggage described in
paragraph (a)(5) of this section, an operation may be performed in an
ATPDEA beneficiary country without
affecting the eligibility of the article
for preferential treatment only if it is
incidental to the assembly process
within the meaning of § 10.16.
(c) Special rules for certain component
materials—(1) Foreign findings, trimmings, interlinings, and yarns—(i) General. An article otherwise described
under paragraph (a) of this section will
not be ineligible for the preferential
treatment referred to in § 10.241 because
the article contains:
(A) Findings and trimmings of foreign origin, if the value of those findings and trimmings does not exceed 25
percent of the cost of the components
of the assembled article. For purposes
of this section ‘‘findings and trimmings’’ include, but are not limited to,
sewing thread, hooks and eyes, snaps,
buttons, ‘‘bow buds,’’ decorative lace
trim, elastic strips, zippers (including
zipper tapes), and labels;
(B) Interlinings of foreign origin, if
the value of those interlinings does not
exceed 25 percent of the cost of the
components of the assembled article.
For purposes of this section ‘‘interlinings’’ include only a chest type
plate, a ‘‘hymo’’ piece, or ‘‘sleeve header,’’ of woven or weft-inserted warp
knit construction and of coarse animal
hair or man-made filaments;
(C) Any combination of findings and
trimmings of foreign origin and interlinings of foreign origin, if the total
value of those findings and trimmings

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§ 10.244

19 CFR Ch. I (4–1–11 Edition)

and interlinings does not exceed 25 percent of the cost of the components of
the assembled article; or
(D) Yarns not wholly formed in the
United States or in one or more
ATPDEA beneficiary countries if the
total weight of all those yarns is not
more than 7 percent of the total weight
of the article.
(ii) ‘‘Cost’’ and ‘‘value’’ defined. The
‘‘cost’’ of components and the ‘‘value’’ of
findings and trimmings or interlinings
referred to in paragraph (c)(1)(i) of this
section means:
(A) The ex-factory price of the components, findings and trimmings, or
interlinings as set out in the invoice or
other commercial documents, or, if the
price is other than ex-factory, the price
as set out in the invoice or other commercial documents adjusted to arrive
at an ex-factory price; or
(B) If the price cannot be determined
under paragraph (c)(1)(ii)(A) of this section or if CBP finds that price to be unreasonable, all reasonable expenses incurred in the growth, production, manufacture, or other processing of the
components, findings and trimmings,
or interlinings, including the cost or
value of materials and general expenses, plus a reasonable amount for
profit.
(iii) Treatment of yarns as findings or
trimmings. If any yarns not wholly
formed in the United States or one or
more ATPDEA beneficiary countries
are used in an article as a finding or
trimming
described
in
paragraph
(c)(1)(i)(A) of this section, the yarns
will be considered to be a finding or
trimming for purposes of paragraph
(c)(1)(i) of this section.
(2) Special rule for nylon filament yarn.
An article otherwise described under
paragraph (a)(1)(i) through (iii), (a)(2),
or (a)(7) of this section will not be ineligible for the preferential treatment
referred to in § 10.241 because the article contains nylon filament yarn (other
than elastomeric yarn) that is classifiable in subheading 5402.10.30, 5402.10.60,
5402.31.30, 5402.31.60, 5402.32.30, 5402.32.60,
5402.41.10,
5402.41.90,
5402.51.00,
or
5402.61.00 of the HTSUS and that is entered free of duty from Canada, Mexico,
or Israel.

(d) Imported directly defined. For purposes of paragraph (a) of this section,
the words ‘‘imported directly’’ mean:
(1) Direct shipment from any
ATPDEA beneficiary country to the
United States without passing through
the territory of any country that is not
an ATPDEA beneficiary country;
(2) If the shipment is from any
ATPDEA beneficiary country to the
United States through the territory of
any country that is not an ATPDEA
beneficiary country, the articles in the
shipment do not enter into the commerce of any country that is not an
ATPDEA beneficiary country while en
route to the United States and the invoices, bills of lading, and other shipping documents show the United States
as the final destination; or
(3) If the shipment is from any
ATPDEA beneficiary country to the
United States through the territory of
any country that is not an ATPDEA
beneficiary country, and the invoices
and other documents do not show the
United States as the final destination,
the articles in the shipment upon arrival in the United States are imported
directly only if they:
(i) Remained under the control of the
customs authority of the intermediate
country;
(ii) Did not enter into the commerce
of the intermediate country except for
the purpose of sale other than at retail,
and the port director is satisfied that
the importation results from the original commercial transaction between
the importer and the producer or the
producer’s sales agent; and
(iii) Were not subjected to operations
other than loading or unloading, and
other activities necessary to preserve
the articles in good condition.
§ 10.244

Certificate of Origin.

(a) General. A Certificate of Origin
must be employed to certify that an
apparel or other textile article being
exported from an ATPDEA beneficiary
country to the United States qualifies
for the preferential treatment referred
to in § 10.241. The Certificate of Origin
must be prepared in the ATPDEA beneficiary country by the producer or exporter or by the producer’s or exporter’s authorized agent in the format

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U.S. Customs and Border Protection, DHS; Treasury
specified in paragraph (b) of this section. If the person preparing the Certificate of Origin is not the producer of
the article, the person may complete
and sign a Certificate of Origin on the
basis of:
(1) The person’s reasonable reliance
on the producer’s written representation that the article qualifies for preferential treatment; or

§ 10.244

(2) A completed and signed Certificate of Origin for the article voluntarily provided to the person by the
producer.
(b) Form of Certificate. The Certificate
of Origin referred to in paragraph (a) of
this section must be in the following
format:

ANDEAN TRADE PROMOTION AND DRUG ERADICATION ACT TEXTILE CERTIFICATE OF ORIGIN
1. Exporter Name & Address:
2. Producer Name & Address:
3. Importer Name & Address:
4. Description of Article:
5. Preference Group:
Group

Each Description Below Is Only a Summary of the
Cited CFR Provision.

A ........

B ........

C ........
D ........

E ........

F ........
G ........
H ........
I .........

Apparel assembled from U.S. formed, dyed, printed
and finished fabrics or fabric components, or U.S.
formed knit-to-shape components from U.S. or
Andean yarns.
Apparel assembled from Andean chief value llama,
˜ a fabrics, fabric components, or
alpaca or vicun
knit-to-shape components, from Andean yarns.
Apparel assembled from fabrics or yarns considered
as being in short supply in the NAFTA.
Apparel assembled from fabrics or yarns designated as not available in commercial quantities in the United States.
Apparel assembled from a combination of two or
more yarns, fabrics, fabric components, or knitto-shape components described in preference
groups A though D.
Handloomed, handmade, or folklore textile and apparel goods.
Brassieres assembled in the U.S. and/or one or
more Andean beneficiary countries.
Textile luggage assembled from U.S. formed fabrics
from U.S. yarns.
Apparel assembled from Andean formed fabrics,
fabric components, or knit-to-shape components
from U.S. or Andean yarns, whether or not also
assembled, in part, from yarns, fabrics and fabric
components described in preference groups A
through D.

19 CFR
10.243(a)(1)(i).

10.243(a)(1)(ii).

10.243(a)(1)(iii).
10.243(a)(1)(iv).

10.243(a)(2).

10.243(a)(3).
10.243(a)(4).
10.243(a)(5)&(6).
10.243(a)(7).

6. U.S./Andean Fabric Producer Name & Address:
7. U.S./Andean Yarn Producer Name & Address:

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§ 10.244

19 CFR Ch. I (4–1–11 Edition)

ANDEAN TRADE PROMOTION AND DRUG ERADICATION ACT TEXTILE CERTIFICATE OF ORIGIN—
Continued
8. Handloomed, Handmade, or Folklore Article:
9. Name of Short Supply Fabric or Yarn:
I certify that the information on this document is complete and accurate and I
assume the responsibility for proving such representations. I understand that I
am liable for any false statements or material omissions made on or in connection with this document. I agree to maintain, and present upon request,
documentation necessary to support this certificate.
10. Authorized Signature:
11. Company:
12. Name: (Print or Type)
13. Title:
14. Date: (DD/MM/YY)
15. Blanket Period:
From:
To:
16. Telephone:
Facsimile:

(c) Preparation of Certificate. The following rules will apply for purposes of
completing the Certificate of Origin set
forth in paragraph (b) of this section:
(1) Blocks 1 through 5 pertain only to
the final article exported to the United
States for which preferential treatment may be claimed;
(2) Block 1 should state the legal
name and address (including country)
of the exporter;
(3) Block 2 should state the legal
name and address (including country)
of the producer. If there is more than
one producer, attach a list stating the
legal name and address (including
country) of all additional producers. If
this information is confidential, it is
acceptable to state ‘‘available to Customs and Border Protection (CBP)
upon request’’ in block 2. If the producer and the exporter are the same,
state ‘‘same’’ in block 2;
(4) Block 3 should state the legal
name and address (including country)
of the importer;
(5) Block 4 should provide a full description of each article. The descrip-

tion should be sufficient to relate it to
the invoice description and to the description of the article in the international Harmonized System. Include
the invoice number as shown on the
commercial invoice or, if the invoice
number is not known, include another
unique reference number such as the
shipping order number;
(6) In block 5, insert the letter that
designates the preference group which
applies to the article according to the
description contained in the CFR provision cited on the Certificate for that
group;
(7) Blocks 6 through 9 must be completed only when the block in question
calls for information that is relevant
to the preference group identified in
block 5;
(8) Block 6 should state the legal
name and address (including country)
of the fabric producer;
(9) Block 7 should state the legal
name and address (including country)
of the yarn producer;
(10) Block 8 should state the name of
the folklore article or should state that

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U.S. Customs and Border Protection, DHS; Treasury
the article is handloomed or handmade
of handloomed fabric;
(11) Block 9 should be completed if
the article described in block 4 incorporates a fabric or yarn described in
preference group C or D and should
state the name of the fabric or yarn
that has been considered as being in
short supply in the NAFTA or that has
been designated as not available in
commercial quantities in the United
States. Block 9 also should be completed if preference group E or I applies
to the article described in block 4 and
the article incorporates a fabric or
yarn described in preference group C or
D;
(12) Block 10 must contain the signature of the producer or exporter or the
producer’s or exporter’s authorized
agent having knowledge of the relevant
facts;
(13) Block 14 should reflect the date
on which the Certificate was completed
and signed;
(14) Block 15 should be completed if
the Certificate is intended to cover
multiple shipments of identical articles as described in block 4 that are imported into the United States during a
specified period of up to one year (see
§ 10.246(b)(4)(ii)). The ‘‘from’’ date is the
date on which the Certificate became
applicable to the article covered by the
blanket Certificate (this date may be
prior to the date reflected in block 14).
The ‘‘to’’ date is the date on which the
blanket period expires; and
(15) The Certificate may be printed
and reproduced locally. If more space is
needed to complete the Certificate, attach a continuation sheet.
§ 10.245 Filing of claim for preferential
treatment.
(a) Declaration. In connection with a
claim for preferential treatment for an
apparel or other textile article described in § 10.243, the importer must
make a written declaration that the
article qualifies for that treatment.
The inclusion on the entry summary,
or equivalent documentation, of the
subheading within Chapter 98 of the
HTSUS under which the article is classified will constitute the written declaration. Except in any of the circumstances described in § 10.246(d)(1),
the declaration required under this

§ 10.246

paragraph must be based on a Certificate of Origin that has been completed
and properly executed in accordance
with § 10.244, that covers the article
being imported, and that is in the possession of the importer.
(b) Corrected declaration. If, after
making the declaration required under
paragraph (a) of this section, the importer has reason to believe that a Certificate of Origin on which a declaration was based contains information
that is not correct, the importer must
within 30 calendar days after the date
of discovery of the error make a corrected declaration and pay any duties
that may be due. A corrected declaration will be effected by submission of a
letter or other written statement to
the CBP port where the declaration
was originally filed.
§ 10.246 Maintenance of records and
submission of Certificate by importer.
(a) Maintenance of records. Each importer claiming preferential treatment
for an article under § 10.245 must maintain in the United States, in accordance with the provisions of part 163 of
this chapter, all records relating to the
importation of the article. Those
records must include a copy of the Certificate of Origin referred to in
§ 10.245(a) and any other relevant documents or other records as specified in
§ 163.1(a) of this chapter.
(b) Submission of Certificate. An importer who claims preferential treatment on an apparel or other textile article under § 10.245(a) must provide, at
the request of the port director, a copy
of the Certificate of Origin pertaining
to the article. A Certificate of Origin
submitted to CBP under this paragraph:
(1) Must be in writing or must be
transmitted electronically through any
electronic data interchange system authorized by CBP for that purpose;
(2) If in writing, must be signed by
the producer or exporter or the producer’s or exporter’s authorized agent
having knowledge of the relevant facts;
(3) Must be completed either in the
English language or in the language of
the country from which the article is
exported. If the Certificate is completed in a language other than

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§ 10.247

19 CFR Ch. I (4–1–11 Edition)

English, the importer must provide to
CBP upon request a written English
translation of the Certificate; and
(4) May be applicable to:
(i) A single importation of an article
into the United States, including a single shipment that results in the filing
of one or more entries and a series of
shipments that results in the filing of
one entry; or
(ii) Multiple importations of identical articles into the United States
that occur within a specified blanket
period, not to exceed 12 months, set out
in the Certificate by the exporter. For
purposes
of
this
paragraph
and
§ 10.244(c)(14), ‘‘identical articles’’ means
articles that are the same in all material respects, including physical characteristics, quality, and reputation.
(c) Correction and nonacceptance of
Certificate. If the port director determines that a Certificate of Origin is illegible or defective or has not been
completed in accordance with paragraph (b) of this section, the importer
will be given a period of not less than
five working days to submit a corrected Certificate. A Certificate will
not be accepted in connection with subsequent importations during a period
referred to in paragraph (b)(4)(ii) of
this section if the port director determined that a previously imported identical article covered by the Certificate
did not qualify for preferential treatment.
(d) Certificate not required—(1) General. Except as otherwise provided in
paragraph (d)(2) of this section, an importer is not required to have a Certificate of Origin in his possession for:
(i) An importation of an article for
which the port director has in writing
waived the requirement for a Certificate of Origin because the port director
is otherwise satisfied that the article
qualifies for preferential treatment;
(ii) A non-commercial importation of
an article; or
(iii) A commercial importation of an
article whose value does not exceed
US$2,500, provided that, unless waived
by the port director, the producer, exporter, importer or authorized agent
includes on, or attaches to, the invoice
or other document accompanying the
shipment the following signed statement:

I hereby certify that the article covered by
this shipment qualifies for preferential
treatment under the ATPDEA.
Check One:
( ) Producer
( ) Exporter
( ) Importer
( ) Agent
llllllllllllllllllllllll
Name
llllllllllllllllllllllll
Title
llllllllllllllllllllllll
Address
llllllllllllllllllllllll
Signature and Date

(2) Exception. If the port director determines that an importation described
in paragraph (d)(1) of this section forms
part of a series of importations that
may reasonably be considered to have
been undertaken or arranged for the
purpose of avoiding a Certificate of Origin
requirement
under
§§ 10.244
through 10.246, the port director will
notify the importer in writing that for
that importation the importer must
have in his possession a valid Certificate of Origin to support the claim for
preferential treatment. The importer
will have 30 calendar days from the
date of the written notice to obtain a
valid Certificate of Origin, and a failure to timely obtain the Certificate of
Origin will result in denial of the claim
for preferential treatment. For purposes of this paragraph, a ‘‘series of importations’’ means two or more entries
covering articles arriving on the same
day from the same exporter and consigned to the same person.
§ 10.247 Verification and justification
of claim for preferential treatment.
(a) Verification by CBP. A claim for
preferential treatment made under
§ 10.245, including any statements or
other information contained on a Certificate of Origin submitted to CBP
under § 10.246, will be subject to whatever verification the port director
deems necessary. In the event that the
port director for any reason is prevented from verifying the claim, the
port director may deny the claim for
preferential treatment. A verification
of a claim for preferential treatment
may involve, but need not be limited
to, a review of:

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U.S. Customs and Border Protection, DHS; Treasury
(1) All records required to be made,
kept, and made available to CBP by the
importer or any other person under
part 163 of this chapter;
(2) Documentation and other information regarding the country of origin
of an article and its constituent materials, including, but not limited to,
production records, information relating to the place of production, the
number and identification of the types
of machinery used in production, and
the number of workers employed in
production; and
(3) Evidence to document the use of
U.S. or ATPDEA beneficiary country
materials in the production of the article in question, such as purchase orders, invoices, bills of lading and other
shipping documents, and customs import and clearance documents.
(b) Importer requirements. In order to
make a claim for preferential treatment under § 10.245, the importer:
(1) Must have records that explain
how the importer came to the conclusion that the apparel or other textile
article qualifies for preferential treatment. Those records must include documents that support a claim that the
article in question qualifies for preferential treatment because it is specifically described in one of the provisions
under § 10.243(a). If the importer is
claiming that the article incorporates
fabric or yarn that was wholly formed
in the United States or in an ATPDEA
beneficiary country, the importer must
have records that identify the producer
of the fabric or yarn. A properly completed Certificate of Origin in the form
set forth in § 10.244(b) is a record that
would serve these purposes;
(2) Must establish and implement internal controls which provide for the
periodic review of the accuracy of the
Certificates of Origin or other records
referred to in paragraph (b)(1) of this
section;
(3) Must have shipping papers that
show how the article moved from the
ATPDEA beneficiary country to the
United States. If the imported article
was shipped through a country other
than an ATPDEA beneficiary country
and the invoices and other documents
from the ATPDEA beneficiary country
do not show the United States as the
final destination, the importer also

§ 10.248

must have documentation that demonstrates that the conditions set forth
in § 10.243(d)(3)(i) through (iii) were
met; and
(4) Must be prepared to explain, upon
request from CBP, how the records and
internal controls referred to in paragraphs (b)(1) through (b)(3) of this section justify the importer’s claim for
preferential treatment.
§ 10.248 Additional requirements for
preferential treatment of brassieres.
(a) Definitions. When used in this section, the following terms have the
meanings indicated:
(1) Producer. ‘‘Producer’’ means an individual, corporation, partnership, association, or other entity or group that
exercises direct, daily operational control over the production process in an
ATPDEA beneficiary country.
(2) Entity controlling production. ‘‘Entity controlling production’’ means an
individual, corporation, partnership,
association, or other entity or group
that is not a producer and that controls the production process in an
ATPDEA beneficiary country through
a contractual relationship or other indirect means.
(3) Fabrics formed in the United States.
‘‘Fabrics formed in the United States’’
means fabrics that were produced by a
weaving, knitting, needling, tufting,
felting, entangling or other fabricmaking process performed in the
United States.
(4) Cost. ‘‘Cost’’ when used with reference to fabrics formed in the United
States means:
(i) The price of the fabrics when last
purchased, f.o.b. port of exportation, as
set out in the invoice or other commercial documents, or, if the price is other
than f.o.b. port of exportation:
(A) The price as set out in the invoice
or other commercial documents adjusted to arrive at an f.o.b. port of exportation price; or
(B) If no exportation to an ATPDEA
beneficiary country is involved, the
price as set out in the invoice or other
commercial
documents,
less
the
freight, insurance, packing, and other
costs incurred in transporting the fabrics to the place of production if included in that price; or

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§ 10.248

19 CFR Ch. I (4–1–11 Edition)

(ii) If the price cannot be determined
under paragraph (a)(4)(i) of this section
or if CBP finds that price to be unreasonable, all reasonable expenses incurred in the growth, production, manufacture, or other processing of the
fabrics, including the cost or value of
materials (which includes the cost of
non-recoverable scrap generated in
forming the fabrics) and general expenses, plus a reasonable amount for
profit, and the freight, insurance, packing, and other costs, if any, incurred in
transporting the fabrics to the port of
exportation.
(5) Declared customs value. ‘‘Declared
customs value’’ when used with reference to fabric contained in an article
means the sum of:
(i) The cost of fabrics formed in the
United States that the producer or entity controlling production can verify;
and
(ii) The cost of all other fabric contained in the article, exclusive of all
findings and trimmings, determined as
follows:
(A) In the case of fabric purchased by
the producer or entity controlling production, the f.o.b. port of exportation
price of the fabric as set out in the invoice or other commercial documents,
or, if the price is other than f.o.b. port
of exportation:
(1) The price as set out in the invoice
or other commercial documents adjusted to arrive at an f.o.b. port of exportation price, plus expenses for embroidering and dyeing, printing, and
finishing operations applied to the fabric if not included in that price; or
(2) If no exportation to an ATPDEA
beneficiary country is involved, the
price as set out in the invoice or other
commercial documents, plus expenses
for embroidering and dyeing, printing,
and finishing operations applied to the
fabric if not included in that price, but
less the freight, insurance, packing,
and other costs incurred in transporting the fabric to the place of production if included in that price;
(B) In the case of fabric for which the
cost cannot be determined under paragraph (a)(5)(ii)(A) of this section or if
CBP finds that cost to be unreasonable,
all reasonable expenses incurred in the
growth, production, or manufacture of
the fabric, including the cost or value

of materials (which includes the cost of
non-recoverable scrap generated in the
growth, production, or manufacture of
the fabric), general expenses and embroidering and dyeing, printing, and
finishing expenses, plus a reasonable
amount for profit, and the freight, insurance, packing, and other costs, if
any, incurred in transporting the fabric
to the port of exportation;
(C) In the case of fabric components
purchased by the producer or entity
controlling production, the f.o.b. port
of exportation price of those fabric
components as set out in the invoice or
other commercial documents, less the
cost or value of any non-textile materials, and less expenses for cutting or
other processing to create the fabric
components other than knitting to
shape, that the producer or entity controlling production can verify, or, if
the price is other than f.o.b. port of exportation:
(1) The price as set out in the invoice
or other commercial documents adjusted to arrive at an f.o.b. port of exportation price, less the cost or value
of any non-textile materials, and less
expenses for cutting or other processing to create the fabric components
other than knitting to shape, that the
producer or entity controlling production can verify; or
(2) If no exportation to an ATPDEA
beneficiary country is involved, the
price as set out in the invoice or other
commercial documents, less the cost or
value of any non-textile materials, and
less expenses for cutting or other processing to create the fabric components
other than knitting to shape, that the
producer or entity controlling production can verify, and less the freight, insurance, packing, and other costs incurred in transporting the fabric components to the place of production if
included in that price; and
(D) In the case of fabric components
for which a fabric cost cannot be determined under paragraph (a)(5)(ii)(C) of
this section or if CBP finds that cost to
be unreasonable: All reasonable expenses incurred in the growth, production, or manufacture of the fabric components, including the cost or value of
materials (which does not include the
cost of recoverable scrap generated in

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U.S. Customs and Border Protection, DHS; Treasury
the growth, production, or manufacture of the fabric components) and general expenses, but excluding the cost or
value of any non-textile materials, and
excluding expenses for cutting or other
processing to create the fabric components other than knitting to shape,
that the producer or entity controlling
production can verify, plus a reasonable amount for profit, and the freight,
insurance, packing, and other costs, if
any, incurred in transporting the fabric
components to the port of exportation.
(6) Year. ‘‘Year’’ means a 12-month period beginning on October 1 and ending
on September 30 but does not include
any 12-month period that began prior
to October 1, 2002.
(7) Entered. ‘‘Entered’’ means entered,
or withdrawn from warehouse for consumption, in the customs territory of
the United States.
(b) Limitations on preferential treatment—(1) General. During the year that
begins on October 1, 2003, and during
any subsequent year, articles of a producer or an entity controlling production that conform to the production
standards set forth in § 10.243(a)(4) will
be eligible for preferential treatment
only if:
(i) The aggregate cost of fabrics (exclusive of all findings and trimmings)
formed in the United States that were
used in the production of all of those
articles of that producer or that entity
controlling production that are entered
as articles described in § 10.243(a)(4)
during the immediately preceding year
was at least 75 percent of the aggregate
declared customs value of the fabric
(exclusive of all findings and trimmings) contained in all of those articles of that producer or that entity
controlling production that are entered
as articles described in § 10.243(a)(4)
during that year; or
(ii) In a case in which the 75 percent
requirement set forth in paragraph
(b)(1)(i) of this section was not met
during a year and therefore those articles of that producer or that entity
controlling production were not eligible for preferential treatment during
the following year, the aggregate cost
of fabrics (exclusive of all findings and
trimmings) formed in the United
States that were used in the production of all of those articles of that pro-

§ 10.248

ducer or that entity controlling production that conform to the production
standards set forth in § 10.243(a)(4) and
that were entered during the immediately preceding year was at least 85
percent of the aggregate declared customs value of the fabric (exclusive of
all findings and trimmings) contained
in all of those articles of that producer
or that entity controlling production
that conform to the production standards set forth in § 10.243(a)(4) and that
were entered during that year; and
(iii) In conjunction with the filing of
the claim for preferential treatment
under § 10.245, the importer records on
the entry summary or warehouse withdrawal for consumption (CBP Form
7501, column 34), or its electronic
equivalent, the distinct and unique
identifier assigned by CBP to the applicable documentation prescribed under
paragraph (c) of this section.
(2) Rules of application—(i) General.
For purposes of paragraphs (b)(1)(i) and
(b)(1)(ii) of this section and for purposes of preparing and filing the documentation prescribed in paragraph (c)
of this section, the following rules will
apply:
(A) The articles in question must
have been produced in the manner
specified in § 10.243(a)(4) and the articles in question must be entered within
the same year;
(B) Articles that are exported to
countries other than the United States
and are never entered are not to be
considered in determining compliance
with the 75 or 85 percent standard specified in paragraph (b)(1)(i) or paragraph
(b)(1)(ii) of this section;
(C) Articles that are entered under an
HTSUS subheading other than the
HTSUS subheading which pertains to
articles described in § 10.243(a)(4) are
not to be considered in determining
compliance with the 75 percent standard specified in paragraph (b)(1)(i) of
this section;
(D) For purposes of determining compliance with the 85 percent standard
specified in paragraph (b)(1)(ii) of this
section, all articles that conform to
the production standards set forth in
§ 10.243(a)(4) must be considered, regardless of the HTSUS subheading
under which they were entered;

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§ 10.248

19 CFR Ch. I (4–1–11 Edition)

(E) Fabric components and fabrics
that constitute findings or trimmings
are not to be considered in determining
compliance with the 75 or 85 percent
standard specified in paragraph (b)(1)(i)
or paragraph (b)(1)(ii) of this section;
(F) Beginning October 1, 2003, in
order for articles to be eligible for preferential treatment in a given year, a
producer of, or entity controlling production of, those articles must have
met the 75 percent standard specified
in paragraph (b)(1)(i) of this section
during the immediately preceding
year. If articles of a producer or entity
controlling production fail to meet the
75 percent standard specified in paragraph (b)(1)(i) of this section during a
year, articles of that producer or entity controlling production:
(1) Will not be eligible for preferential treatment during the following year;
(2) Will remain ineligible for preferential treatment until the year that
follows a year in which articles of that
producer or entity controlling production met the 85 percent standard specified in paragraph (b)(1)(ii) of this section; and
(3) After the 85 percent standard
specified in paragraph (b)(1)(ii) of this
section has been met, will again be subject to the 75 percent standard specified in paragraph (b)(1)(i) of this section during the following year for purposes of determining eligibility for
preferential treatment in the next
year.
(G) A new producer or new entity
controlling production, that is, a producer or entity controlling production
who did not produce or control production of articles that were entered as articles described in § 10.243(a)(4) during
the immediately preceding year, must
first establish compliance with the 85
percent standard specified in paragraph
(b)(1)(ii) of this section as a prerequisite to preparation of the declaration of compliance referred to in paragraph (c) of this section;
(H) A declaration of compliance prepared by a producer or by an entity
controlling production must cover all
production of that producer or all production that the entity controls for the
year in question;

(I) A producer would not prepare a
declaration of compliance if all of its
production is covered by a declaration
of compliance prepared by an entity
controlling production;
(J) In the case of a producer, the 75 or
85 percent standard specified in paragraph (b)(1)(i) or paragraph (b)(1)(ii) of
this section and the declaration of
compliance procedure under paragraph
(c) of this section apply to all articles
of that producer for the year in question, even if some but not all of that
production is also covered by a declaration of compliance prepared by an entity controlling production;
(K) The U.S. importer does not have
to be the producer or the entity controlling production who prepared the
declaration of compliance; and
(L) The exclusion references regarding findings and trimmings in paragraph (b)(1)(i) and paragraph (b)(1)(ii)
of this section apply to all findings and
trimmings, whether or not they are of
foreign origin.
(ii) Examples. The following examples
will illustrate application of the principles set forth in paragraph (b)(2)(i) of
this section.
Example 1. An ATPDEA beneficiary country producer of articles that meet the production standards specified in § 10.243(a)(4) in
the first year sends 50 percent of that production to ATPDEA region markets and the
other 50 percent to the U.S. market; the cost
of the fabrics formed in the United States
equals 100 percent of the value of all of the
fabric in the articles sent to the ATPDEA region and 60 percent of the value of all of the
fabric in the articles sent to the United
States. Although the cost of fabrics formed
in the United States is more than 75 percent
of the value of all of the fabric used in all of
the articles produced, this producer could
not prepare a valid declaration of compliance because the articles sent to the United
States did not meet the minimum 75 percent
standard.
Example 2. A producer sends to the United
States in the first year three shipments of
articles that meet the description in
§ 10.243(a)(4); one of those shipments is entered under the HTSUS subheading that covers articles described in § 10.243(a)(4), the second shipment is entered under the HTSUS
subheading that covers articles described in
§ 10.243(a)(7), and the third shipment is entered under subheading 9802.00.80, HTSUS. In
determining whether the minimum 75 percent standard has been met in the first year
for purposes of entry of articles under the

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U.S. Customs and Border Protection, DHS; Treasury
HTSUS subheading that covers articles described in § 10.243(a)(4) during the following
(that is, second) year, consideration must be
restricted to the articles in the first shipment and therefore must not include the articles in the second and third shipments.
Example 3. A producer in the second year
begins production of articles that conform to
the production standards specified in
§ 10.243(a)(4); some of those articles are entered in that year under HTSUS subheading
6212.10 and others under HTSUS subheading
9802.00.80 but none are entered in that year
under the HTSUS subheading which pertains
to articles described in § 10.243(a)(4) because
the 75 percent standard had not been met in
the preceding (that is, first) year. In this
case the 85 percent standard applies, and all
of the articles that were entered under the
various HTSUS provisions in the second year
must be taken into account in determining
whether that 85 percent standard has been
met. If the 85 percent was met in the aggregate for all of the articles entered in the second year, in the next (that is, third) year articles of that producer may receive preferential treatment under the HTSUS subheading which pertains to articles described
in § 10.243(a)(4).
Example 4. An entity controlling production of articles that meet the description in
§ 10.243(a)(4) buys for the U.S., Canadian and
Mexican markets; the articles in each case
are first sent to the United States where
they are entered for consumption and then
placed in a commercial warehouse from
which they are shipped to various stores in
the United States, Canada and Mexico. Notwithstanding the fact that some of the articles ultimately ended up in Canada or Mexico, a declaration of compliance prepared by
the entity controlling production must cover
all of the articles rather than only those
that remained in the United States because
all of those articles had been entered for consumption.
Example 5. Fabric is cut and sewn in the
United States with other U.S. materials to
form cups which are joined together to form
brassiere front subassemblies in the United
States, and those front subassemblies are
then placed in a warehouse in the United
States where they are held until the following year; during that following year all of
the front subassemblies are shipped to an
ATPDEA beneficiary country where they are
assembled with elastic strips for use as brassiere straps and labels produced in an Asian
country and other fabrics, components or
materials produced in the ATPDEA beneficiary country to form articles that meet
the production standards specified in
§ 10.243(a)(4) and that are then shipped to the
United States and entered during that same
year. In determining whether the entered articles meet the minimum 75 or 85 percent
standard, the fabric in the labels is to be dis-

§ 10.248

regarded entirely because the labels constitute findings or trimmings for purposes of
this section, and all of the fabric in the front
subassemblies is countable because it was all
formed in the United States and used in the
production of articles that were entered in
the same year.
Example 6. An ATPDEA beneficiary country producer’s entire production of articles
that meet the description in § 10.243(a)(4) is
sent to a U.S. importer in two separate shipments, one in February and the other in
June of the same calendar year; the articles
shipped in February do not meet the minimum 75 percent standard, the articles
shipped in June exceed the 85 percent standard, and the articles in the two shipments,
taken together, do meet the 75 percent
standard; the articles covered by the February shipment are entered for consumption
on March 1 of that calendar year, and the articles covered by the June shipment are
placed in a CBP bonded warehouse upon arrival and are subsequently withdrawn from
warehouse for consumption on November 1 of
that calendar year. The ATPDEA beneficiary
country producer may not prepare a valid
declaration of compliance covering the articles in the first shipment because those articles did not meet the minimum 75 percent
standard and because those articles cannot
be included with the articles of the second
shipment on the same declaration of compliance since they were entered in a different
year. However, the ATPDEA beneficiary
country producer may prepare a valid declaration of compliance covering the articles
in the second shipment because those articles did meet the requisite 85 percent standard which would apply for purposes of entry
of articles in the following year.
Example 7. A producer in the second year
begins production of articles exclusively for
the U.S. market that meet the production
standards specified in § 10.243(a)(4), but the
entered articles do not meet the requisite 85
percent standard until the third year. The
producer’s articles may not receive preferential treatment during the second year
because there was no production (and thus
there were no entered articles) in the immediately preceding (that is, first) year on
which to assess compliance with the 75 percent standard. The producer’s articles also
may not receive preferential treatment during the third year because the 85 percent
standard was not met in the immediately
preceding (that is, second) year. However,
the producer’s articles are eligible for preferential treatment during the fourth year
based on compliance with the 85 percent
standard in the immediately preceding (that
is, third) year.
Example 8. An entity controlling production (Entity A) uses five ATPDEA beneficiary country producers (Producers 1–5), all
of which produce only articles that meet the

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§ 10.248

19 CFR Ch. I (4–1–11 Edition)

description in § 10.243(a)(4); Producers 1–4
send all of their production to the United
States and Producer 5 sends 10 percent of its
production to the United States and the rest
to Europe; Producers 1–3 and Producer 5
produce only pursuant to contracts with Entity A, but Producer 4 also operates independently of Entity A by producing for several U.S. importers, one of which is an entity
controlling production (Entity B) that also
controls all of the production of articles of
one other producer (Producer 6) which sends
all of its production to the United States. A
declaration of compliance prepared by Entity A must cover all of the articles of Producers 1–3 and the 10 percent of articles of
Producer 5 that are sent to the United States
and that portion of the articles of Producer
4 that are produced pursuant to the contract
with Entity A, because Entity A controls the
production of those articles. There is no need
for Producers 1–3 and Producer 5 to prepare
a declaration of compliance because they
have no production that is not covered by a
declaration of compliance prepared by an entity controlling production. A declaration of
compliance prepared by Producer 4 would
cover all of its production, that is, articles
produced for Entity A, articles produced for
Entity B, and articles produced independently for other U.S. importers; a declaration
of compliance prepared by Entity B must
cover that portion of the production of Producer 4 that it controls as well as all of the
production of Producer 6 because Entity B
also controls all of the production of Producer 6. Producer 6 would not prepare a declaration of compliance because all of its production is covered by the declaration of compliance prepared by Entity B.

(c) Documentation—(1) Initial declaration of compliance. In order for an importer to comply with the requirement
set forth in paragraph (b)(1)(iii) of this
section, the producer or the entity controlling production must have filed
with CBP, in accordance with paragraph (c)(4) of this section, a declaration of compliance with the applicable
75 or 85 percent requirement prescribed
in paragraph (b)(1)(i) or (b)(1)(ii) of this
section. After filing of the declaration
of compliance has been completed, CBP
will advise the producer or the entity
controlling production of the distinct
and unique identifier assigned to that
declaration. The producer or the entity
controlling production will then be re-

sponsible for advising each appropriate
U.S. importer of that distinct and
unique identifier for purposes of recording that identifier on the entry
summary or warehouse withdrawal. In
order to provide sufficient time for advising the U.S. importer of that distinct and unique identifier prior to the
arrival of the articles in the United
States, the producer or the entity controlling production should file the declaration of compliance with CBP at
least 10 calendar days prior to the date
of the first shipment of the articles to
the United States.
(2) Amended declaration of compliance.
If the information on the declaration of
compliance referred to in paragraph
(c)(1) of this section is based on an estimate because final year-end information was not available at that time and
the final data differs from the estimate, or if the producer or the entity
controlling production has reason to
believe for any other reason that the
declaration of compliance that was
filed contained erroneous information,
within 30 calendar days after the final
year-end information becomes available or within 30 calendar days after
the date of discovery of the error:
(i) The producer or the entity controlling production must file with the
CBP office identified in paragraph
(c)(4) of this section an amended declaration of compliance containing that
final year-end information or other
corrected information; or
(ii) If that final year-end information
or other corrected information demonstrates noncompliance with the applicable 75 or 85 percent requirement,
the producer or the entity controlling
production must in writing advise both
the CBP office identified in paragraph
(c)(4) of this section and each appropriate U.S. importer of that fact.
(3) Form and preparation of declaration
of compliance—(i) Form. The declaration
of compliance referred to in paragraph
(c)(1) of this section may be printed
and reproduced locally and must be in
the following format:

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U.S. Customs and Border Protection, DHS; Treasury

§ 10.248

ANDEAN TRADE PROMOTION AND DRUG ERADICATION ACT DECLARATION OF COMPLIANCE FOR
BRASSIERES
[19 CFR 10.243(a)(4) and 10.248]

1.

Year beginning date: October 1,
llllllllllll
Year ending date: September 30,
llllllllllll

Official U.S. CBP Use Only
Assigned number: llllllllllll
Assignment date:llllllllllll

2. Identity of preparer (producer or entity controlling production):
Full name and address:

Telephone number: llllllllllll
Facsimile number: llllllllllll
Importer identification number:llllll

3. If the preparer is an entity controlling production, provide the following for each producer:
Full
name
and
address:
llllllllllll

Telephone number: llllllllllll
Facsimile number: llllllllllll

4. Aggregate cost of fabrics (exclusive of all findings and trimmings) formed in the United
States that were used in the production of brassieres that were entered during the year:
llllllllllll
5. Aggregate declared customs value of the fabric (exclusive of all findings and trimmings) contained in brassieres that were entered during the year:
llllllllllll
6. I declare that the aggregate cost of fabric (exclusive of all findings and trimmings) formed in
the United States was at least 75 percent (or 85 percent, if applicable under 19 CFR
10.248(b)(1)(ii)) of the aggregate declared customs value of the fabric contained in brassieres entered during the year.
7.

Authorized
ture:llllllllllll

signa-

8.

Name
and
title
(print
type):llllllllllll

or

Date:

(ii) Preparation. The following rules
will apply for purposes of completing
the declaration of compliance set forth
in paragraph (c)(3)(i) of this section:
(A) In block 1, fill in the year commencing October 1 and ending September 30 of the calendar year during
which the applicable 75 or 85 percent
standard specified in paragraph (b)(1)(i)
or paragraph (b)(1)(ii) of this section
was met;
(B) Block 2 should state the legal
name and address (including country)
of the preparer and should also include
the preparer’s importer identification
number (see § 24.5 of this chapter), if
the preparer has one;

(C) Block 3 should state the legal
name and address (including country)
of the ATPDEA beneficiary country
producer if that producer is not already
identified in block 2. If there is more
than one producer, attach a list stating
the legal name and address (including
country) of all additional producers;
(D) Blocks 4 and 5 apply only to articles that were entered during the year
identified in block 1; and
(E) In block 7, the signature must be
that of an authorized officer, employee,
agent or other person having knowledge of the relevant facts and the date

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§ 10.248

19 CFR Ch. I (4–1–11 Edition)

must be the date on which the declaration of compliance was completed and
signed.
(4) Filing of declaration of compliance.
The declaration of compliance referred
to in paragraph (c)(1) of this section:
(i) Must be completed either in the
English language or in the language of
the country in which the articles covered by the declaration were produced.
If the declaration is completed in a
language other than English, the producer or the entity controlling production must provide to CBP upon request
a written English translation of the
declaration; and
(ii) Must be filed with the New York
Strategic Trade Center, Customs and
Border Protection, 1 Penn Plaza, New
York, New York 10119.
(d) Verification of declaration of compliance—(1) Verification procedure. A declaration of compliance filed under this
section will be subject to whatever
verification CBP deems necessary. In
the event that CBP for any reason is
prevented from verifying the statements made on a declaration of compliance, CBP may deny any claim for
preferential treatment made under
§ 10.245 that is based on that declaration. A verification of a declaration of
compliance may involve, but need not
be limited to, a review of:
(i) All records required to be made,
kept, and made available to CBP by the
importer, the producer, the entity controlling production, or any other person under part 163 of this chapter;
(ii) Documentation and other information regarding all articles that meet
the production standards specified in
§ 10.243(a)(4) that were exported to the
United States and that were entered
during the year in question, whether or
not a claim for preferential treatment
was made under § 10.245. Those records
and other information include, but are
not limited to, work orders and other
production records, purchase orders,
invoices, bills of lading and other shipping documents;
(iii) Evidence to document the cost of
fabrics formed in the United States
that were used in the production of the
articles in question, such as purchase
orders, invoices, bills of lading and
other shipping documents, and customs
import and clearance documents, work

orders and other production records,
and inventory control records;
(iv) Evidence to document the cost or
value of all fabric other than fabrics
formed in the United States that were
used in the production of the articles
in question, such as purchase orders,
invoices, bills of lading and other shipping documents, and customs import
and clearance documents, work orders
and other production records, and inventory control records; and
(v) Accounting books and documents
to verify the records and information
referred to in paragraphs (d)(1)(ii)
through (d)(1)(iv) of this section. The
verification of purchase orders, invoices and bills of lading will be accomplished through the review of a distinct audit trail. The audit trail documents must consist of a cash disbursement or purchase journal or equivalent
records to establish the purchase of the
fabric. The headings in each of these
journals or other records must contain
the date, vendor name, and amount
paid for the fabric. The verification of
production records and work orders
will be accomplished through analysis
of the inventory records of the producer or entity controlling production.
The inventory records must reflect the
production of the finished article which
must be referenced to the original purchase order or lot number covering the
fabric used in production. In the inventory production records, the inventory
should show the opening balance of the
inventory plus the purchases made during the accounting period and the inventory closing balance.
(2) Notice of determination. If, based on
a verification of a declaration of compliance filed under this section, CBP
determines that the applicable 75 or 85
percent standard specified in paragraph
(b)(1)(i) or paragraph (b)(1)(ii) of this
section was not met, CBP will publish
a notice of that determination in the
FEDERAL REGISTER.
EXTENSION OF ATPA BENEFITS TO TUNA
AND CERTAIN OTHER NON-TEXTILE ARTICLES

SOURCE: Sections 10.251 through 10.257
issued by T.D. 03–16, 68 FR 14497, Mar. 25,
2003; 68 FR 67349, Dec. 1, 2003, unless otherwise noted.

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U.S. Customs and Border Protection, DHS; Treasury
§ 10.251 Applicability.
Title XXXI of Public Law 107–210 (116
Stat. 933), entitled the Andean Trade
Promotion and Drug Eradication Act
(ATPDEA), amended sections 202, 203,
204, and 208 of the Andean Trade Preference Act (the ATPA, 19 U.S.C. 3201–
3206) to authorize the President to extend additional trade benefits to ATPA
beneficiary countries that have been
designated as ATPDEA beneficiary
countries. Sections 204(b)(1) and (b)(4)
of the ATPA (19 U.S.C. 3203(b)(1) and
(b)(4)) provide for the preferential
treatment of certain non-textile articles that were not entitled to duty-free
treatment under the ATPA prior to enactment of the ATPDEA. The provisions of §§ 10.251–10.257 of this part set
forth the legal requirements and procedures that apply for purposes of obtaining preferential treatment pursuant to
ATPA sections 204(b)(1) and (b)(4).
§ 10.252 Definitions.
When used in §§ 10.251 through 10.257,
the following terms have the meanings
indicated:
ATPA. ‘‘ATPA’’ means the Andean
Trade Preference Act, 19 U.S.C. 3201–
3206.
ATPDEA
beneficiary
country.
‘‘ATPDEA beneficiary country’’ means
a ‘‘beneficiary country’’ as defined in
§ 10.202(a) for purposes of the ATPA
which the President also has designated as a beneficiary country for
purposes of preferential treatment of
products under 19 U.S.C. 3203(b)(1) and
(b)(4) and which has been the subject of
a finding by the President or his designee, published in the FEDERAL REGISTER, that the beneficiary country has
satisfied the requirements of 19 U.S.C.
3203(b)(5)(A)(ii).
ATPDEA beneficiary country vessel.
‘‘ATPDEA beneficiary country vessel’’
means a vessel:
(a) Which is registered or recorded in
an ATPDEA beneficiary country;
(b) Which sails under the flag of an
ATPDEA beneficiary country;
(c) Which is at least 75 percent owned
by nationals of an ATPDEA beneficiary
country or by a company having its
principal place of business in an
ATPDEA beneficiary country, of which
the manager or managers, chairman of
the board of directors or of the super-

§ 10.253

visory board, and the majority of the
members of those boards are nationals
of an ATPDEA beneficiary country and
of which, in the case of a company, at
least 50 percent of the capital is owned
by an ATPDEA beneficiary country or
by public bodies or nationals of an
ATPDEA beneficiary country;
(d) Of which the master and officers
are nationals of an ATPDEA beneficiary country; and
(e) Of which at least 75 percent of the
crew are nationals of an ATPDEA beneficiary country.
HTSUS. ‘‘HTSUS’’ means the Harmonized Tariff Schedule of the United
States.
Preferential treatment. ‘‘Preferential
treatment’’ means entry, or withdrawal
from warehouse for consumption, in
the customs territory of the United
States free of duty and free of any
quantitative restrictions in the case of
tuna described in § 10.253(a)(1) and free
of duty in the case of any article described in § 10.253(a)(2).
United States vessel. ‘‘United States
vessel’’ means either: a vessel having a
certificate of documentation with a
fishery endorsement under chapter 121
of title 46 of the United States Code; or
a vessel that is documented under the
laws of the United States and for which
a license has been issued pursuant to
section 9 of the South Pacific Tuna Act
of 1988.
[ T.D. 03–16, 68 FR 14497, Mar. 25, 2003; 68 FR
67349, Dec. 1, 2003, as amended by CBP Dec.
06–21, 71 FR 44583, Aug. 7, 2006]

§ 10.253 Articles eligible
erential treatment.

for

(a) General. Preferential treatment
applies to any of the following articles,
provided that the article in question is
imported directly into the customs territory of the United States from an
ATPDEA beneficiary country within
the meaning of paragraph (b) of this
section:
(1) Tuna that is harvested by United
States vessels or ATPDEA beneficiary
country vessels, that is prepared or
preserved in any manner, in an
ATPDEA beneficiary country, in foil or
other flexible airtight containers
weighing with their contents not more
than 6.8 kilograms each; and

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§ 10.253

19 CFR Ch. I (4–1–11 Edition)

(2) Any of the following articles that
the President has determined are not
import-sensitive in the context of imports from ATPDEA beneficiary countries, provided that the article in question meets the country of origin and
value content requirements set forth in
paragraphs (c) and (d) of this section:
(i) Footwear not designated on December 4, 1991, as eligible articles for
the purpose of the Generalized System
of Preferences (GSP) under Title V,
Trade Act of 1974, as amended (19
U.S.C. 2461 through 2467);
(ii) Petroleum, or any product derived from petroleum, provided for in
headings 2709 and 2710 of the HTSUS;
(iii) Watches and watch parts (including cases, bracelets, and straps), of
whatever type including, but not limited to, mechanical, quartz digital or
quartz analog, if those watches or
watch parts contain any material
which is the product of any country
with respect to which HTSUS column 2
rates of duty apply; and
(iv) Handbags, luggage, flat goods,
work gloves, and leather wearing apparel that were not designated on August 5, 1983, as eligible articles for purposes of the GSP.
(b) Imported directly defined. For purposes of paragraph (a) of this section,
the words ‘‘imported directly’’ mean:
(1) Direct shipment from any
ATPDEA beneficiary country to the
United States without passing through
the territory of any country that is not
an ATPDEA beneficiary country;
(2) If the shipment is from any
ATPDEA beneficiary country to the
United States through the territory of
any country that is not an ATPDEA
beneficiary country, the articles in the
shipment do not enter into the commerce of any country that is not an
ATPDEA beneficiary country while en
route to the United States and the invoices, bills of lading, and other shipping documents show the United States
as the final destination; or
(3) If the shipment is from any
ATPDEA beneficiary country to the
United States through the territory of
any country that is not an ATPDEA
beneficiary country, and the invoices
and other documents do not show the
United States as the final destination,
the articles in the shipment upon ar-

rival in the United States are imported
directly only if they:
(i) Remained under the control of the
customs authority of the intermediate
country;
(ii) Did not enter into the commerce
of the intermediate country except for
the purpose of sale other than at retail,
and the port director is satisfied that
the importation results from the original commercial transaction between
the importer and the producer or the
producer’s sales agent; and
(iii) Were not subjected to operations
other than loading or unloading, and
other activities necessary to preserve
the articles in good condition.
(c) Country of origin criteria—(1) General. Except as otherwise provided in
paragraph (c)(2) of this section, an article described in paragraph (a)(2) of this
section may be eligible for preferential
treatment if the article is either:
(i) Wholly the growth, product, or
manufacture of an ATPDEA beneficiary country; or
(ii) A new or different article of commerce which has been grown, produced,
or manufactured in an ATPDEA beneficiary country.
(2) Exceptions. No article will be eligible for preferential treatment by virtue
of having merely undergone simple (as
opposed to complex or meaningful)
combining or packaging operations, or
mere dilution with water or mere dilution with another substance that does
not materially alter the characteristics
of the article. The principles and examples set forth in § 10.195(a)(2) will apply
equally for purposes of this paragraph.
(d) Value content requirement—(1) General. An article may be eligible for preferential treatment only if the sum of
the cost or value of the materials produced in an ATPDEA beneficiary country or countries, plus the direct costs
of processing operations performed in
an ATPDEA beneficiary country or
countries, is not less than 35 percent of
the appraised value of the article at
the time it is entered.
(2) Commonwealth of Puerto Rico, U.S.
Virgin Islands and CBI beneficiary countries. For the specific purpose of determining the percentage referred to in
paragraph (d)(1) of this section, the
term ‘‘ATPDEA beneficiary country’’
includes the Commonwealth of Puerto

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U.S. Customs and Border Protection, DHS; Treasury
Rico, the U.S. Virgin Islands, and any
CBI beneficiary country as defined in
§ 10.191(b)(1). Any cost or value of materials or direct costs of processing operations attributable to the Virgin Islands or any CBI beneficiary country
must be included in the article prior to
its final exportation to the United
States from an ATPDEA beneficiary
country as defined in § 10.252.
(3) Materials produced in the United
States. For purposes of determining the
percentage referred to in paragraph
(d)(1) of this section, an amount not to
exceed 15 percent of the appraised
value of the article at the time it is entered may be attributed to the cost or
value of materials produced in the customs territory of the United States
(other than the Commonwealth of
Puerto Rico). The principles set forth
in paragraph (d)(4)(i) of this section
will apply in determining whether a
material is ‘‘produced in the customs
territory of the United States’’ for purposes of this paragraph.
(4) Cost or value of materials—(i) ‘‘Materials produced in an ATPDEA beneficiary country or countries’’ defined. For
purposes of paragraph (d)(1) of this section, the words ‘‘materials produced in
an ATPDEA beneficiary country or
countries’’ refer to those materials incorporated in an article which are either:
(A) Wholly the growth, product, or
manufacture of an ATPDEA beneficiary country or two or more
ATPDEA beneficiary countries; or
(B) Substantially transformed in any
ATPDEA beneficiary country or two or
more ATPDEA beneficiary countries
into a new or different article of commerce which is then used in any
ATPDEA beneficiary country as defined in § 10.252 in the production or
manufacture of a new or different article which is imported directly into the
United States. For purposes of this
paragraph (d)(4)(i)(B), no material will
be considered to be substantially transformed into a new or different article
of commerce by virtue of having merely undergone simple (as opposed to
complex or meaningful) combining or
packaging operations, or mere dilution
with water or mere dilution with another substance that does not materially alter the characteristics of the ar-

§ 10.253

ticle. The examples set forth in
§ 10.196(a), and the principles and examples set forth in § 10.195(a)(2), will apply
for purposes of the corresponding context under paragraph (d)(4)(i) of this
section.
(ii) Failure to establish origin. If the
importer fails to maintain adequate
records to establish the origin of a material, that material may not be considered to have been grown, produced,
or manufactured in an ATPDEA beneficiary country or in the customs territory of the United States for purposes
of determining the percentage referred
to in paragraph (d)(1) of this section.
(iii) Determination of cost or value of
materials. (A) The cost or value of materials produced in an ATPDEA beneficiary country or countries or in the
customs territory of the United States
includes:
(1) The manufacturer’s actual cost
for the materials;
(2) When not included in the manufacturer’s actual cost for the materials,
the freight, insurance, packing, and all
other costs incurred in transporting
the materials to the manufacturer’s
plant;
(3) The actual cost of waste or spoilage, less the value of recoverable scrap;
and
(4) Taxes and/or duties imposed on
the materials by any ATPDEA beneficiary country or by the United
States, provided they are not remitted
upon exportation.
(B) Where a material is provided to
the manufacturer without charge, or at
less than fair market value, its cost or
value will be determined by computing
the sum of:
(1) All expenses incurred in the
growth, production, or manufacture of
the material, including general expenses;
(2) An amount for profit; and
(3) Freight, insurance, packing, and
all other costs incurred in transporting
the material to the manufacturer’s
plant.
(5) Direct costs of processing operations—(i) Items included. For purposes
of paragraph (d)(1) of this section, the

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§ 10.254

19 CFR Ch. I (4–1–11 Edition)

words ‘‘direct costs of processing operations’’ mean those costs either directly incurred in, or which can be reasonably allocated to, the growth, production, manufacture, or assembly of
the specific merchandise under consideration. Those costs include, but are
not limited to the following, to the extent that they are includable in the appraised value of the imported merchandise:
(A) All actual labor costs involved in
the growth, production, manufacture,
or assembly of the specific merchandise, including fringe benefits, on-thejob training, and the cost of engineering, supervisory, quality control, and
similar personnel;
(B) Dies, molds, tooling, and depreciation on machinery and equipment
which are allocable to the specific merchandise;
(C) Research, development, design,
engineering, and blueprint costs insofar as they are allocable to the specific
merchandise; and
(D) Costs of inspecting and testing
the specific merchandise.
(ii) Items not included. For purposes of
paragraph (d)(1) of this section, the
words ‘‘direct costs of processing operations’’ do not include items which are
not directly attributable to the merchandise under consideration or are
not costs of manufacturing the product. These include, but are not limited
to:
(A) Profit; and
(B) General expenses of doing business which either are not allocable to
the specific merchandise or are not related to the growth, production, manufacture, or assembly of the merchandise, such as administrative salaries,
casualty and liability insurance, advertising, and salesmen’s salaries, commissions, or expenses.
(6) Articles wholly the growth, product,
or manufacture of an ATPDEA beneficiary country. Any article which is
wholly the growth, product, or manufacture of an ATPDEA beneficiary
country as defined in § 10.252, and any
article produced or manufactured in an
ATPDEA beneficiary country as defined in § 10.252 exclusively from materials which are wholly the growth,
product,
or
manufacture
of
an
ATPDEA beneficiary country or coun-

tries, will normally be presumed to
meet the requirement set forth in paragraph (d)(1) of this section.
§ 10.254 Certificate of Origin.
A Certificate of Origin as specified in
§ 10.256 must be employed to certify
that an article described in § 10.253(a)
being exported from an ATPDEA beneficiary country to the United States
qualifies for the preferential treatment
referred to in § 10.251. The Certificate of
Origin must be prepared in the
ATPDEA beneficiary country by the
producer or exporter or by the producer’s or exporter’s authorized agent.
If the person preparing the Certificate
of Origin is not the producer of the article, the person may complete and
sign a Certificate on the basis of:
(a) The person’s reasonable reliance
on the producer’s written representation that the article qualifies for preferential treatment; or
(b) A completed and signed Certificate of Origin for the article voluntarily provided to the person by the
producer.
[CBP Dec. 06–21, 71 FR 44583, Aug. 7, 2006]

§ 10.255 Filing of claim for preferential
treatment.
(a) Declaration. In connection with a
claim for preferential treatment for an
article described in § 10.253(a), the importer must make a written declaration that the article qualifies for that
treatment. The written declaration
should be made by including on the
entry summary, or equivalent documentation, the symbol ‘‘J+’’ as a prefix
to the subheading of the HTSUS in
which the article in question is classified. Except in any of the circumstances described in § 10.256(d)(1),
the declaration required under this
paragraph must be based on a complete
and properly executed original Certificate of Origin that covers the article
being imported and that is in the possession of the importer.
(b) Corrected declaration. If, after
making the declaration required under
paragraph (a) of this section, the importer has reason to believe that a Certificate of Origin on which a declaration was based contains information
that is not correct, the importer must
within 30 calendar days after the date

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U.S. Customs and Border Protection, DHS; Treasury
of discovery of the error make a corrected declaration and pay any duties
that may be due. A corrected declaration will be effected by submission of a
letter or other written statement to
the Customs port where the declaration was originally filed.
§ 10.256 Maintenance of records and
submission of Certificate by importer.
(a) Maintenance of records. Each importer claiming preferential treatment
for an article under § 10.255 must maintain in the United States, in accordance with the provisions of part 163 of
this chapter, all records relating to the
importation of the article. Those
records must include the original Certificate of Origin referred to in
§ 10.255(a) and any other relevant documents or other records as specified in
§ 163.1(a) of this chapter.
(b) Submission of Certificate. An importer who claims preferential treatment on an article under § 10.255(a)
must provide, at the request of the port
director, a copy of the Certificate of
Origin pertaining to the article. A Certificate of Origin submitted to Customs
under this paragraph:
(1) Must be on CBP Form 449, including privately-printed copies of that
Form, or, as an alternative to CBP
Form 449, in an approved computerized
format or other medium or format as is
approved by the Office of International
Trade, U.S. Customs and Border Protection, Washington, DC 20229. An alternative format must contain the
same information and certification set
forth on CBP Form 449;
(2) Must be signed by the producer or
exporter or by the producer’s or exporter’s authorized agent having knowledge
of the relevant facts;
(3) Must be completed either in the
English language or in the language of
the country from which the article is
exported. If the Certificate is completed in a language other than
English, the importer must provide to
Customs upon request a written
English translation of the Certificate;
and
(4) May be applicable to:
(i) A single importation of an article
into the United States, including a single shipment that results in the filing

§ 10.256

of one or more entries and a series of
shipments that results in the filing of
one entry; or
(ii) Multiple importations of identical articles into the United States
that occur within a specified blanket
period, not to exceed 12 months, set out
in the Certificate by the exporter. For
purposes of this paragraph, ‘‘identical
articles’’ means articles that are the
same in all material respects, including physical characteristics, quality,
and reputation.
(c) Correction and nonacceptance of
Certificate. If the port director determines that a Certificate of Origin is illegible or defective or has not been
completed in accordance with paragraph (b) of this section, the importer
will be given a period of not less than
five working days to submit a corrected Certificate. A Certificate will
not be accepted in connection with subsequent importations during a period
referred to in paragraph (b)(4)(ii) of
this section if the port director determined that a previously imported identical article covered by the Certificate
did not qualify for preferential treatment.
(d) Certificate not required—(1) General. Except as otherwise provided in
paragraph (d)(2) of this section, an importer is not required to have a Certificate of Origin in his possession for:
(i) An importation of an article for
which the port director has in writing
waived the requirement for a Certificate of Origin because the port director
is otherwise satisfied that the article
qualifies for preferential treatment;
(ii) A non-commercial importation of
an article; or
(iii) A commercial importation of an
article whose value does not exceed
US$2,500, provided that, unless waived
by the port director, the producer, exporter, importer or authorized agent
includes on, or attaches to, the invoice
or other document accompanying the
shipment the following signed statement:
I hereby certify that the article covered by
this shipment qualifies for preferential tariff
treatment under the ATPDEA.
Check One:
( ) Producer
( ) Exporter
( ) Importer

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§ 10.257

19 CFR Ch. I (4–1–11 Edition)

( ) Agent
lllllllllllllllll
Name
lllllllllllllllll
Title
lllllllllllllllll
Address
lllllllllllllllll
Signature and Date

(2) Exception. If the port director determines that an importation described
in paragraph (d)(1) of this section forms
part of a series of importations that
may reasonably be considered to have
been undertaken or arranged for the
purpose of avoiding a Certificate of Origin
requirement
under
§§ 10.254
through 10.256, the port director will
notify the importer in writing that for
that importation the importer must
have in his possession a valid Certificate of Origin to support the claim for
preferential treatment. The importer
will have 30 calendar days from the
date of the written notice to obtain a
valid Certificate of Origin, and a failure to timely obtain the Certificate of
Origin will result in denial of the claim
for preferential treatment. For purposes of this paragraph, a ‘‘series of importations’’ means two or more entries
covering articles arriving on the same
day from the same exporter and consigned to the same person.
[T.D. 03–16, 68 FR 14497, Mar. 25, 2003; 68 FR
67349, Dec. 1, 2003, as amended by CBP Dec.
06–21, 71 FR 44583, Aug. 7, 2006]

§ 10.257 Verification and justification
of claim for preferential treatment.
(a) Verification by Customs. A claim
for preferential treatment made under
§ 10.255, including any statements or
other information contained on a Certificate of Origin submitted to Customs
under § 10.256, will be subject to whatever verification the port director
deems necessary. In the event that the
port director for any reason is prevented from verifying the claim, the
port director may deny the claim for
preferential treatment. A verification
of a claim for preferential treatment
may involve, but need not be limited
to, a review of:
(1) All records required to be made,
kept, and made available to Customs
by the importer or any other person
under part 163 of this chapter;

(2) Documentation and other information regarding the country of origin
of an article and its constituent materials, including, but not limited to,
production records, information relating to the place of production, the
number and identification of the types
of machinery used in production, and
the number of workers employed in
production; and
(3) Evidence to document the use of
U.S. or ATPDEA beneficiary country
materials in the production of the article in question, such as purchase orders, invoices, bills of lading and other
shipping documents, and customs import and clearance documents.
(b) Importer requirements. In order to
make a claim for preferential treatment under § 10.255, the importer:
(1) Must have records that explain
how the importer came to the conclusion that the article qualifies for preferential treatment. Those records must
include documents that support a
claim that the article in question
qualifies for preferential treatment because it meets the country of origin
and value content requirements set
forth in § 10.253(c) and (d). A properly
completed Certificate of Origin in the
form prescribed in § 10.254(b) is a record
that would serve this purpose;
(2) Must establish and implement internal controls which provide for the
periodic review of the accuracy of the
Certificate of Origin or other records
referred to in paragraph (b)(1) of this
section;
(3) Must have shipping papers that
show how the article moved from the
ATPDEA beneficiary country to the
United States. If the imported article
was shipped through a country other
than an ATPDEA beneficiary country
and the invoices and other documents
from the ATPDEA beneficiary country
do not show the United States as the
final destination, the importer also
must have documentation that demonstrates that the conditions set forth
in § 10.253(b)(3)(i) through (iii) were
met; and
(4) Must be prepared to explain, upon
request from Customs, how the records
and internal controls referred to in
paragraphs (b)(1) through (b)(3) of this
section justify the importer’s claim for
preferential treatment.

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U.S. Customs and Border Protection, DHS; Treasury

Subpart G—United States-Canada
Free Trade Agreement
SOURCE: Sections 10.301 through 10.311
issued by T.D. 89–3, 53 FR 51766, Dec. 23, 1988,
unless otherwise noted.

§ 10.301

Scope and applicability.

The provisions of §§ 10.302 through
10.311 of this part relate to the procedures for obtaining duty preferences on
imported goods under the United
States-Canada Free-Trade Agreement
(the Agreement) entered into on January 2, 1988, and the United States-Canada Free-Trade Agreement Implementation Act of 1988 (102 Stat. 1851). The
United States and Canada agreed to
suspend operation of the Agreement
with effect from January 1, 1994, to coincide with the entry into force of the
North American Free Trade Agreement
(see part 181 of this chapter) and, accordingly, the provisions of §§ 10.302
through 10.311 of this part apply only
to goods imported from Canada that
were entered for consumption, or withdrawn from warehouse for consumption, during the period January 1, 1989,
through December 31, 1993. In situations involving goods subject to bilateral restrictions or prohibitions, or
country of origin marking, other criteria for determining origin may be applicable pursuant to Article 407 of the
Agreement.
[T.D. 96–35, 61 FR 19835, May 3, 1996]

§ 10.302

Eligibility criteria in general.

Subject to the more specific explanations of the criteria in §§ 10.303 and
10.305 of this part, goods classifiable
under an HTSUS heading or subheading for which the symbol ‘‘CA’’ appears in the ‘‘special’’ column are eligible for a preference if:
(a) Originating goods. The goods originate in Canada or the United States, or
both, and
(b) Direct shipment required. Except as
provided in § 10.306(b), are directly
shipped to the United States from Canada.
§ 10.303

Originating goods.

(a) General. For purposes of eligibility for a preference under the Agree-

§ 10.303

ment, goods may be regarded as originating goods if:
(1) Wholly of Canadian or United States
origin. The goods are wholly obtained
or produced in the Territory of Canada
or the United States, or both, as set
forth in General Note 3(c), HTSUS;
(2) Transformed with a change in classification. The goods have been transformed by a processing which results in
a change in classification and, if required, a sufficient value-content, as
set forth in General Note 3(c), HTSUS;
or
(3) Transformed without a change in
classification. An assembly of goods,
other than goods of chapters 61 to 63 of
the HTSUS, which does not result in a
change in classification because the
goods were imported in an unassembled
or disassembled form and classified as
the goods, unassembled or disassembled, pursuant to General Rule of Interpretation 2(a), HTSUS, or because
the tariff subheading for the goods provides for both the goods themselves
and their parts, shall nonetheless be
treated as originating goods if:
(i) The value of originating materials
and the direct cost of assembling in
Canada or the United States, or both,
as defined in § 10.305 constitute not less
than 50 percent of the value of the
goods when exported to the United
States;
(ii) The assembled goods are not subsequently processed or further assembled in a third country; and
(iii) The goods satisfy the requirement in § 10.306.
(b) Originating materials. For purposes
of this section and § 10.305, the term
‘‘materials’’ means goods, other than
those included as part of the direct
cost of processing or assembling, used
or consumed in the production of other
goods, and the term ‘‘orginating’’ when
used with reference to such materials
means that the materials satisfy one of
the criteria for originating goods set
forth in paragraph (a) of this section.
(c) Change in classification. For purposes of paragraph (a) of this section,
the expression ‘‘change in classification’’ means a change of classification
within the Harmonized Commodity Description and Coding System (Harmonized System) as published and

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§ 10.304

19 CFR Ch. I (4–1–11 Edition)

amended from time to time by the Customs Cooperation Council.
(d) Articles of feather. The goods are
eligible to be treated as originating in
Canada pursuant to General Note
3(c)(vii)(R)(12)(ee), HTSUS.
[T.D. 92–8, 57 FR 2453, Jan. 22, 1992]

§ 10.304

Exclusions.

(a) Changes based on simple processing.
No goods shall be considered originating for purposes of eligibility under
the Agreement if they have merely undergone simple packaging or simple
combining operations, or have undergone mere dilution with water or with
another substance that does not materially alter the characteristics of the
goods.
(b) Other excluded processing. No
goods shall be considered to be originating merely by virtue of having undergone any process or work in which
the facts clearly justify the presumption that the sole object was to circumvent the provisions of Chapter 3 of
the Agreement.
§ 10.305

Value content requirement.

(a) Direct cost of processing or assembling—(1) Definition. For purposes of applying a specific rule of origin under
the Agreement which requires a value
content determination, the terms ‘‘direct cost of processing’’ and ‘‘direct cost
of assembling’’ mean the costs directly
incurred in, or that can be reasonably
allocated to, the production of goods,
including:
(i) The cost of all labor, including
benefits and on-the-job training, labor
provided in connection with supervision, quality control, shipping, receiving, storage, packaging, management at the location of the process or
assembly, and other like labor, whether provided by employees or independent contractors;
(ii) The cost of inspecting and testing
the goods;
(iii) The cost of energy, fuel, dies,
molds, tooling, and the depreciation
and maintenance of machinery and
equipment, without regard to whether
they originate within the territory of
the United States or Canada;
(iv) Development, design, and engineering costs;

(v) Rent, mortgage interest, depreciation on buildings, property insurance
premiums, maintenance, taxes and the
cost of utilities for real property used
in the production of the goods; and
(vi) Royalty, licensing, or other like
payments for the right to the goods.
(2) Exclusions from direct costs of processing or assembling. Excluded from the
direct costs of processing or assembling
are:
(i) Costs relating to the general expense of doing business, such as the
cost of providing executive, financial,
sales, advertising, marketing, accounting and legal services, and insurance;
(ii) Brokerage charges relating to the
importation and exportation of goods;
(iii) Costs for telephone, mail, and
other means of communication;
(iv) Packing costs for exporting the
goods;
(v) Royalty payments related to a licensing agreement to distribute or sell
the goods;
(vi) Rent, mortgage interest, depreciation on buildings, property insurance premiums, maintenance, taxes,
and the cost of utilities for real property used by personnel charged with
administrative functions; and
(vii) Profit on the goods.
(3) Interpretation—(i) Indirect materials. Under the definition of ‘‘materials’’ set forth in § 10.303(b), certain
types of materials are treated as direct
costs of processing or assembling under
paragraph (a) of this section. This applies principally to materials used or
consumed indirectly in the production
of exported goods, where no portion of
those materials is physically incorporated in the exported goods. In addition to the items specified in paragraph
(a)(1)(iii) of this section, such materials include items such as gloves and
safety glasses worn by production
workers, tape used in painting processes, and tools, materials and spare
parts used in the repair and maintenance of machinery and equipment
used in the production of the exported
goods. Such materials are to be distinguished from waste and spoilage specified in paragraph (b)(1)(ii)(C) of this
section, which relate to materials that
are physically incorporated in the exported goods.

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U.S. Customs and Border Protection, DHS; Treasury
(ii) Directly incurred. In order for
costs incurred by a production facility
to be treated as direct costs of processing or assembling, those costs must
be directly incurred in the production
of the exported goods and not merely
associated with the production facility
as peripheral costs necessary to operate the facility. In addition to the exclusions set forth in paragraph (a)(2) of
this section, such peripheral costs include labor costs for nurses tending to
employees, for accounting personnel
involved in physical inventory taking,
for personnel responsible for purchasing or requisitioning materials to
be used or consumed in the production
process, and for second level supervisors and above who are not directly
involved in the production process.
(iii) Labor costs. Under paragraph
(a)(1)(i) of this section, labor costs includable as direct costs of processing or
assembling are limited to labor provided by the producer’s employees or
by independent contractors. Thus, for
example, where processing operations
are performed on components in the
United States and those components
are sold to a manufacturer in Canada
where they are incorporated in goods
exported to the United States, the cost
of those processing operations in the
United States cannot be separately
counted as a direct cost of processing
attributable to the finished goods exported to the United States.
(iv) Interest expense. Bona fide interest payments on debt of any form, secured or unsecured, undertaken on
arm’s length terms in the ordinary
course of business to finance the acquisition of fixed assets such as real property, a plant, and/or equipment used in
the production of goods in the territory
of Canada or the U.S. are includable in
the direct cost of processing or direct
cost of assembling. Interest will be
treated as a direct cost of processing or
assembling, but only that portion of
the interest which is related to a fixed
asset directly used in the production of
the goods exported; thus, where an entire production facility is covered by a
mortgage and incorporates both production and administrative or other
general expense space, an appropriate
allocation must be made in order to ensure that only that portion of the in-

§ 10.305

terest allocated to the production area
is counted toward the value-content requirement. Interest expenses attributable to general and administrative
costs or expenses, including interest on
funds borrowed to meet the payroll of
personnel directly involved in the production of goods, are not considered direct costs of processing or assembly.
(b) Value of originating materials—(1)
Definition. The term ‘‘value of materials
originating in the United States or
Canada or both’’ means the aggregate
of:
(i) The price paid by the producer of
exported goods for materials originating in either the United States or
Canada, or both, or for materials imported from a third country used or
consumed in the production of such
originating materials; and
(ii) When not included in that price,
the following costs related thereto:
(A) Freight, insurance, packing and
all other costs incurred in transporting
any of the materials referred to in
paragraph (b)(1)(i) of this section to the
location of the producer;
(B) Duties, taxes and brokerage fees
on such materials paid in the United
States, or Canada, or both;
(C) The cost of waste or spoilage resulting from the use or consumption of
such materials, less the value of renewable scrap or by-product; and
(D) The value of goods and services
relating to such materials determined
in accordance with subparagraph 1(b)
of Article 8 of the Agreement on Implementation of Article VII of the General
Agreement on Tariffs and Trade.
(2) Directly attributable. Whenever a
value-content determination is required by the rules of the Agreement
and whenever originating materials
and materials obtained or produced in
a third country are used or consumed
together in the production of goods in
the United States or Canada, the value
of originating materials may be treated as such only to the extent that the
value is directly attributable to the
goods under consideration.
(3) Interpretation. (i) Price paid. As
provided in paragraph (b)(1) of this section, the ‘‘price paid’’ for materials by
the producer of exported goods forms
the basis for determining the value of
such materials when incorporated in

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§ 10.305

19 CFR Ch. I (4–1–11 Edition)

the exported goods. The actual price
paid for such materials will determine
the value of those materials for purposes of the value-content requirement, even though a relationship between the producer and the seller of
the materials may have influenced the
price, except where the price did not
include items specified in paragraph
(b)(1)(ii) of this section that relate to
the materials. The following examples
will illustrate these principles. Notwithstanding these examples, the totality of the facts must be examined in
each case to determine whether
§ 10.304(b) is applicable.
Example 1. Non-originating materials are
sold by Company X (a foreign corporation located outside the United States or Canada)
to Company Y (a Canadian corporation) for
$100; Company X also sold identical materials to Company Z (a U.S. corporation) for
$200 which was the price Company Z had paid
to Company X for similar materials prior to
implementation of the Agreement; and those
non-originating materials sold by Company
X to Company Y are then incorporated by
Company Y into goods exported to the
United States. In this case the $100 price paid
by Company Y to Company X constitutes the
value of those materials for purposes of the
value-content requirement.
Example 2. Company X purchased materials
for $100, added a four percent mark-up to the
price paid to defray purchasing expenses, and
then sold the marked-up materials to Company Y (a Canadian corporation) which incorporated the materials in goods exported
to the United States. In this case the $104
price paid by Company Y to Company X constitutes the value of the materials for purposes of the value-content requirement.
Example 3. Company X (a foreign corporation located outside the United States) sold
non-originating materials to Company Y (a
U.S. corporation) for $200, and Company Y
then sold those materials for $100 to Company Z (a Canadian corporation) which incorporated the materials in goods which
were imported into the United States by
Company P (the U.S. parent company of
Company Y). In this case, in accordance with
paragraph (b)(1)(ii)(D) of this section, $100
would be added to the price paid by Company
Z for purposes of the value-content requirement because the materials were sold at a
reduced cost within the meaning of subparagraph 1(b) of Article 8 of the Agreement on
Implementation of Article VII of the General
Agreement on Tariffs and Trade.

(ii) Originating materials for which no
price paid. In cases involving a
vertically integrated producer (that is,

an entity which produces goods for export from materials which that producer has also made) a ‘‘price paid’’ for
such originating materials normally
does not exist. Even in the absence of a
‘‘price paid’’, such a vertically integrated producer may still claim the
materials as originating materials for
purposes of qualifying the finished
goods exported to the United States as
goods originating in Canada. However,
under paragraph (b)(1)(i) of this section
the value of those materials for purposes of applying the value-content requirement is limited to the price paid
for those materials imported from the
third country plus any costs added
thereto under paragraph (b)(1)(ii) of
this section. The following examples
will illustrate these principles.
Example 1. If an automobile producer in the
United States or Canada fabricates body panels wholly from third country steel coil,
those body panels can qualify as originating
materials without having to satisfy a valuecontent requirement because steel coil is
classified in chapter 72 of the Harmonized
System and body panels are classified in
chapter 87 and the change in classification
rules in chapter 87 do not incorporate a
value-content requirement in this context.
Thus, the producer can claim the body panels fabricated from the third country steel as
originating materials for purposes of the
value-content requirement applicable to the
finished automobile which will be exported
to the United States. The value of those
originating materials is the price paid for
the steel coil imported from the third country and used or consumed in the production
of the body panels.
Example 2. An automobile exporter in Canada purchases and imports body panels fabricated in a third country in order to join
them with vertically (locally) fabricated
body panels to form an automobile body. If
the body qualifies as an originating material, the exporter has two options. Under the
first option, the exporter can claim the body
as originating material, in which case the
value of originating material is the price
paid for the foreign body panels. Under the
second option, the exporter may elect not to
claim the body as originating material; but,
rather, the exporter may claim as originating material any domestic steel coil used
in producing the vertically (locally) fabricated body panels, in which case the value
of originating material is the price paid for
the domestic steel coil.

(c) Value of goods when exported. The
term ‘‘value of the goods when exported

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U.S. Customs and Border Protection, DHS; Treasury
to the United States’’ means the aggregate of:
(1) The price paid by the producer for
all materials, whether or not the materials originate in the United States, or
Canada, or both, and, when not included in the price paid for the materials, the following costs related thereto:
(i) Freight, insurance, packing, and
all other costs incurred in transporting
all materials to the location of the producer;
(ii) Duties, taxes, and brokerage fees
on all materials paid in the United
States, or Canada, or both;
(iii) The cost of waste or spoilage resulting from the use or consumption of
such materials, less the value of renewable scrap or by-product; and
(iv) The value of goods and services
relating to all materials determined in
accordance with subparagraph 1(b) of
Article 8 of the Agreement on Implementation of Article VII of the General
Agreement on Tariffs Trade; and
(2) The direct cost of processing or
the direct cost of assembling the goods.
[T.D. 92–8, 57 FR 2453, Jan. 22, 1992; 57 FR
4793, Feb. 7, 1992, as amended by T.D. 92–98, 57
FR 46504, Oct. 9, 1992]

§ 10.306 Direct shipment to the United
States.
Goods shall be considered as directly
shipped to the United States from Canada for the purpose of eligibility for
preferences under the Agreement only
under the following circumstances:
(a) Through shipment. The goods have
been shipped directly from Canada to
the United States without passage
through the territory of any third
country; or
(b) Shipment through a third country.
The goods were shipped through the
territory of a third country but:
(1) The goods did not enter the commerce of any third country;
(2) The goods did not undergo any operation other than unloading, reloading, or any operation necessary to
transport them to the United States or
to preserve them in good condition;
and
(3) All shipping and export documents show the United States as the
final destination.

§ 10.307

§ 10.307 Documentation.
(a) Claims for a preference. A preference in accordance with the Agreement may be claimed by including on
the entry summary, or equivalent documentation, the symbol ‘‘CA’’ as a prefix to the subheading of the HTSUS
under which each eligible good is classified.
(b) Failure to claim a preference. Failure to make a timely claim for a preference under the Agreement will result
in liquidation at the rate which would
otherwise be applicable.
(c) Documentation showing origin. A
claim for a preference under the Agreement shall be based on the Exporter’s
Certificate of Origin, properly completed and signed by the person who exports or knowingly causes the goods to
be exported from Canada. The Exporter’s Certificate of Origin must be available at the time the preference is
claimed and shall be presented to the
port director upon request.
(d) Exporter’s Certificate of Origin—(1)
General. The Exporter’s Certificate of
Origin shall be prepared on Customs
Form 353. In lieu of the Customs Form
353, the exporter may use an approved
computerized format or such other format as is approved by the Headquarters, U.S. Customs Service, Office
of Trade Operations, Washington, DC
20229. Alternative formats must contain the same information and certification set forth on Customs Form 353.
(2) Blanket certifications. A blanket
Exporter’s Certificate of Origin, not to
exceed a period of 12 months, issued for
goods claimed as originating goods
under the Agreement, can only be used
if the certifying exporter is able to
verify that the goods in each shipment
to be covered by the blanket certification actually qualify for treatment
under the Agreement. A blanket certification does not allow an exporter to
average its costs over the blanket certification period in order to establish
that the exported goods meet the criteria for originating goods under the
Agreement. Under § 10.308, the exporter
must retain supporting records that
will permit a review of the eligibility
of the goods in each shipment covered
by a blanket certification.
(e) Exceptions to documentation requirements. Exceptions to the foregoing

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§ 10.308

19 CFR Ch. I (4–1–11 Edition)

documentation requirements may be
authorized at the discretion of the port
director
in
the
following
circumstances:
(1) Exception for informal entries. As
set forth in paragraphs (e)(1) (i) and (ii)
of this section, an Exporter’s Certificate of Origin may be waived in connection with an entry entitled to informal entry procedures as authorized in
§§ 143.21 and 143.22 of this chapter if:
(i) Commercial goods which qualify for
informal entry. The invoice, or an appropriate Customs release document,
for commercial goods which qualify
both for informal entry and a preference must include the following
statement, on the invoice or appropriate Customs document:
I hereby certify that the goods described
herein are eligible for a preference based
upon the rules of origin enumerated in the
United States-Canada Free-Trade Agreement.
Check One:
( ) Manufacturer
( ) Supplier
( ) Exporter
llllllllllllllllllllllll
Signature
llllllllllllllllllllllll
Title
Date: llllllllllllllllllll

(ii) Noncommercial goods which qualify
for informal entry. The importation of
goods from Canada by a person for noncommercial use may be exempt from
documentation requirements if the
goods are legally marked ‘‘Made in Canada’’, or it can otherwise be shown that
they are originating goods under the
Agreement and there is no evidence to
the contrary.
(2) Waiver of evidence of direct shipment. The port director may waive the
submission of evidence of direct shipment when otherwise satisfied, taking
into consideration the kind and value
of the goods, that the goods were, in
fact, imported directly from Canada,
and that they otherwise qualify for a
preference in accordance with the
Agreement.
[T.D. 89–3, 53 FR 51766, Dec. 23, 1988, as
amended by T.D. 92–8, 57 FR 2455, Jan. 22,
1992]

§ 10.308 Records retention.
(a) Importer. The importer of record
shall retain the exporter’s certificate
of origin required by § 10.307(d) for a period of 5 years and it must be made
available upon request by the appropriate Customs official.
(b) Exporter. Any person who exports,
or who knowlingly causes to be exported, any merchandise to Canada
shall make, keep, and render for examination and inspection, such records
(including certifications of origin or
copies thereof), which pertain to such
exportation for a period of 5 years from
the date of exportation. In the event
that the appropriate Customs official
requests submission of the records,
they shall be submitted directly to the
requesting official.
§ 10.309 Verification of documentation.
Any evidence of country of origin or
of direct shipment submitted in support of a preference under the Agreement shall be subject to such
verification as the appropriate Customs official may deem necessary. If
the U.S. importer or U.S. exporter or
their agent does not provide the information requested by the appropriate
Customs officer, the port director may
refuse to grant the claim for preference, in addition to other available
sanctions.
§ 10.310 Election to average for motor
vehicles.
(a) Election. In determining whether a
motor vehicle is originating for purposes of the preferences under the
Agreement or a Canadian article under
the Automotive Products Trade Act of
1965 (APTA), a manufacturer may elect
to average, over its 12-month financial
year, its calculation of the value-content requirement for vehicles of the
same class or sister vehicles which are
assembled in the same plant as provided for in the Agreement. A manufacturer must declare its election to average before the importation of any vehicles produced within the identified 12month period. The election to average
is subject to the conditions and requirements set forth in §§ 10.310 and
10.311.
(b) Effect of election. An election to
average shall be binding at the time of

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U.S. Customs and Border Protection, DHS; Treasury

§ 10.402

the first entry of vehicles for which the
election has been made and shall remain binding for the plant for the entire period covered by the election. If a
manufacturer’s annual report, required
by § 10.311, does not verify the claim
that the vehicles are originating goods
under the Agreement or Canadian articles under APTA, or if a manufacturer
otherwise fails to comply with the reporting requirements, entries of the vehicles identified in the averaging declaration will be subject to liquidation
in accordance with the rate of duty
which would otherwise apply.
(c) Election in lieu of certificate of origin. In lieu of the Exporter’s Certificate
of Origin required in § 10.307(c), an importer of vehicles covered by an election to average under this section may
have its claim for preference based on a
copy of the declaration of election.

Negative quarterly reports are required.
(c) Annual Report. An annual report
shall be submitted to the U.S. Customs
and Border Protection, Office of International Trade, Regulatory Audit, Detroit, Michigan 48226–2568, on CBP
Form 357, Vehicle Cost Report (Annual), within 90 days of the end of the
financial year identified in the Election to Average, CBP Form 355. In lieu
of the CBP Form 357, Vehicle Cost Report (Annual), the manufacturer may
submit the information required on the
form in an approved computerized format or such other format as is approved by the U.S. Customs and Border
Protection, Office of International
Trade, Regulatory Audit, Detroit,
Michigan 48226–2568. Alternative formats must contain the same information set forth on CBP Form 357.

[T.D. 89–3, 53 FR 51766, Dec. 23, 1988, as
amended by T.D. 92–8, 57 FR 2455, Jan. 22,
1992]

Subpart H—United States-Chile
Free Trade Agreement

§ 10.311 Documentation for election to
average for motor vehicles.

SOURCE: CBP Dec. 05–07, 70 FR 10873, Mar. 7,
2005, unless otherwise noted.

A manufacturer who elects to average for motor vehicles shall submit a
declaration of election to average,
quarterly reports, and an annual report
in the form and manner as follows:
(a) Declaration of election. A declaration of election to average, signed by
an authorized company official, shall
be submitted by the manufacturer to
the U.S. Customs and Border Protection, Office of International Trade,
Regulatory Audit, Detroit, Michigan
48226–2568 on CBP Form 355, Declaration of Election to Average.
(b) Quarterly Report. A quarterly report shall be submitted to the Office of
International Trade, Regulatory Audit,
at the above address, on CBP Form 356,
Vehicle Cost Report (Quarterly), within 30 days after the end of each quarter.
In lieu of the CBP Form 356, the manufacturer may submit the information
required on the form in an approved
computerized format or such other format as is approved by the U.S. Customs
and Border Protection, Office of International Trade, Regulatory Audit, Detroit, Michigan 48226–2568. Alternative
formats must contain the same information set forth on the CBP Form 356.

GENERAL PROVISIONS
§ 10.401 Scope.
This subpart implements the duty
preference and related customs provisions applicable to imported goods
under the United States-Chile Free
Trade
Agreement
(the
US-CFTA)
signed on June 6, 2003, and under the
United States-Chile Free Trade Agreement Implementation Act (the Act; 117
Stat. 909). Except as otherwise specified in this subpart, the procedures and
other requirements set forth in this
subpart are in addition to the customs
procedures and requirements of general
application contained elsewhere in this
chapter. Additional provisions implementing certain aspects of the USCFTA and the Act are contained in
parts 12, 24, 162, and 163 of this chapter.
[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76131, Dec.
20, 2006]

§ 10.402 General definitions.
As used in this subpart, the following
terms will have the meanings indicated
unless either the context in which they
are used requires a different meaning

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§ 10.402

19 CFR Ch. I (4–1–11 Edition)

or a different definition is prescribed
for a particular section of this subpart:
(a)
Certification.
‘‘Certification’’
means, either when used by itself or in
the expression ‘‘certification of origin’’,
the certification established under article 4.13 of the US-CFTA, that a good
qualifies as an originating good under
the US-CFTA;
(b) Claim of origin. ‘‘Claim of origin’’
means a claim that a textile or apparel
good is an originating good or a good of
a Party;
(c) Claim for preferential tariff treatment. ‘‘Claim for preferential tariff
treatment’’ means a claim that a good
is entitled to the duty rate applicable
under the US–CFTA and to an exemption from the merchandise processing
fee;
(d) Customs authority. ‘‘Customs authority’’ means the competent authority that is responsible under the law of
a Party for the administration of customs laws and regulations;
(e) Customs Valuation Agreement.
‘‘Customs Valuation Agreement’’ means
the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994, which is part of the
WTO Agreement;
(f) Days. ‘‘Days’’ means calendar days;
(g) Customs duty. ‘‘Customs duty’’ includes any customs or import duty and
a charge of any kind imposed in connection with the importation of a good,
including any form of surtax or surcharge in connection with such importation, but, for purposes of implementing the US-CFTA, does not include any:
(1) Charge equivalent to an internal
tax imposed consistently with Article
III:2 of the GATT 1994; in respect of
like, directly competitive, or substitutable goods of the Party, or in respect of
goods from which the imported good
has been manufactured or produced in
whole or in part;
(2) Antidumping or countervailing
duty; and
(3) Fee or other charge in connection
with importation commensurate with
the cost of services rendered;
(h) Enterprise. ‘‘Enterprise’’ means any
entity constituted or organized under
applicable law, whether or not for profit, and whether privately-owned or governmentally-owned, including any cor-

poration, trust, partnership, sole proprietorship, joint venture, or other association;
(i) GATT 1994. ‘‘GATT 1994’’ means the
General Agreement on Tariffs and Trade
1994, which is part of the WTO Agreement;
(j) Goods. ‘‘Goods’’ means domestic
products as these are understood in the
GATT 1994 or such goods as the Parties
may agree, and includes originating
goods of that Party. A good of a Party
may include materials of other countries;
(k) Harmonized System. ‘‘Harmonized
System (HS)’’ means the Harmonized
Commodity Description and Coding System, including its General Rules of Interpretation, Section Notes, and Chapter Notes, as adopted and implemented
by the Parties in their respective tariff
laws;
(l) Heading. ‘‘Heading’’ means the first
four digits in the tariff classification
number under the Harmonized System;
(m) HTSUS. ‘‘HTSUS’’ means the Harmonized Tariff Schedule of the United
States as promulgated by the U.S.
International Trade Commission;
(n) Identical goods. ‘‘Identical goods’’
means goods that are the same in all
respects relevant to the particular rule
of origin that qualifies the goods as
originating;
(o) Indirect material. ‘‘Indirect material’’ means a good used in the production, testing, or inspection of a good in
the territory of the United States or
Chile but not physically incorporated
into the good, or a good used in the
maintenance of buildings or the operation of equipment associated with the
production of a good in the territory of
the United States or Chile, including—
(1) Fuel and energy;
(2) Tools, dies, and molds;
(3) Spare parts and materials used in
the maintenance of equipment and
buildings;
(4) Lubricants, greases, compounding
materials, and other materials used in
production or used to operate equipment and buildings;
(5) Gloves, glasses, footwear, clothing, safety equipment, and supplies;
(6) Equipment, devices, and supplies
used for testing or inspecting the
goods;
(7) Catalysts and solvents; and

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U.S. Customs and Border Protection, DHS; Treasury
(8) Any other goods that are not incorporated into the good but whose use
in the production of the good can reasonably be demonstrated to be a part of
that production;
(p) Originating. ‘‘Originating’’ means
qualifying under the rules of origin set
out in Chapter Four (Rules of Origin
and Origin Procedures) of the USCFTA;
(q) Party. ‘‘Party’’ means the United
States or the Republic of Chile;
(r) Person. ‘‘Person’’ means a natural
person or an enterprise;
(s) Preferential tariff treatment. ‘‘Preferential tariff treatment’’ means the
duty rate applicable to an originating
good under the US–CFTA, and an exemption from the merchandise processing fee.
(t) Subheading. ‘‘Subheading’’ means
the first six digits in the tariff classification number under the Harmonized
System;
(u) Tariff preference level. ‘‘Tariff preference level’’ means a quantitative
limit for certain non-originating textiles and textile apparel goods that
may be entitled to preferential tariff
treatment as if such goods were originating based on the goods meeting the
production requirements set forth in
§ 10.421 of this subpart.
(v) Textile or apparel good. ‘‘Textile or
apparel good’’ means a good listed in
the Annex to the Agreement on Textiles and Clothing (commonly referred
to as ATC), which is part of the WTO
Agreement;
(w) Territory. ‘‘Territory’’ means:
(1) With respect to Chile, the land,
maritime and air space under its sovereignty, and the exclusive economic
zone and the continental shelf within
which it exercises sovereign rights and
jurisdiction in accordance with international law and its domestic law; and
(2) With respect to the United States,
(i) The customs territory of the
United States, which includes the 50
states, the District of Columbia, and
Puerto Rico,
(ii) The foreign trade zones located in
the United States and Puerto Rico, and
(iii) Any areas beyond the territorial
seas of the United States within which,
in accordance with international law
and its domestic law, the United States
may exercise rights with respect to the

§ 10.411

seabed and subsoil and their natural resources;
(x) WTO Agreement. ‘‘WTO Agreement’’ means the Marrakesh Agreement
Establishing the World Trade Organization of April 15, 1994.
[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76131, Dec.
20, 2006]

IMPORT REQUIREMENTS
§ 10.410 Filing of claim for preferential
tariff treatment upon importation.
(a) Declaration. In connection with a
claim for preferential tariff treatment
for an originating good under the USCFTA, including an exemption from
the merchandise processing fee, the
U.S. importer must make a written
declaration that the good qualifies for
such treatment. The written declaration is made by including on the entry
summary, or equivalent documentation, the symbol ‘‘CL’’ as a prefix to the
subheading of the HTSUS under which
each qualifying good is classified, or by
the method specified for equivalent reporting via electronic interchange.
(b) Corrected declaration. If, after
making the declaration required under
paragraph (a) of this section, the U.S.
importer has reason to believe that the
declaration or the certification or
other information on which the declaration was based contains information that is not correct, the importer
must, within 30 calendar days after the
date of discovery of the error, make a
corrected declaration and pay any duties that may be due. A corrected declaration will be effected by submission
of a letter or other statement either in
writing or via an authorized electronic
data interchange system to the CBP office where the original declaration was
filed specifying the correction (see
§§ 10.482 and 10.483 of this subpart).
[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76131, Dec.
20, 2006]

§ 10.411 Certification of origin or other
information.
(a) Contents. An importer who claims
preferential tariff treatment on a good
must submit, at the request of the port
director, a certification of origin or
other information demonstrating that

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§ 10.411

19 CFR Ch. I (4–1–11 Edition)

the good qualifies as originating. A certification or other information submitted to CBP under this paragraph:
(1) Need not be in a prescribed format
but must be in writing or must be
transmitted electronically pursuant to
any electronic means authorized by
CBP for that purpose;
(2) Must include the following information:
(i) The legal name, address, telephone and e-mail address of the importer of record of the good (if known);
(ii) The legal name, address, telephone and e-mail address of the exporter of the good (if different from the
producer);
(iii) The legal name, address, telephone and e-mail address of the producer of the good (if known);
(iv) A description of the good for
which preferential tariff treatment is
claimed, which must be sufficiently detailed to relate it to the invoice and
the HS nomenclature;
(v) The HTSUS tariff classification,
to six or more digits, as necessary for
the specific change in tariff classification rule for the good set forth in General Note 26(n), HTSUS;
(vi) The preference criterion as set
forth in paragraph (f) of this section.
(b) Statement. A certification submitted to CBP under paragraph (a) of
this section must include a statement,
in substantially the following form:
‘‘I Certify that:
The information on this document is true
and accurate and I assume the responsibility
for proving such representations. I understand that I am liable for any false statements or material omissions made on or in
connection with this document;
I agree to maintain, and present upon request, documentation necessary to support
this certification, and to inform, in writing,
all persons to whom the certification was
given of any changes that could affect the
accuracy or validity of this certification;
and
The goods originated in the territory of
one or more of the parties, and comply with
the origin requirements specified for those
goods in the United States-Chile Free Trade
Agreement; there has been no further production or any other operation outside the
territories of the parties, other than unloading, reloading, or any other operation necessary to preserve it in good condition or to
transport the good to the United States; and
This document consists of ll pages, including all attachments.’’

(c) Responsible official or agent. A certification submitted under paragraph
(a) of this section must be signed and
dated by a responsible official of the
importer; exporter; or producer; or by
the importer’s, exporter’s, or producer’s authorized agent having knowledge of the relevant facts. The certification must include the legal name and
address of the responsible official or
authorized agent signing the certification, and should include that person’s telephone and e-mail address, if
available. If the person making the certification is not the producer of the
good, or the producer’s authorized
agent, the person may sign the certification of origin based on:
(1) A certification that the good
qualifies as originating issued by the
producer; or
(2) Knowledge of the exporter or importer that the good qualifies as an
originating good.
(d) Language. The certification or
other information submitted under
paragraph (a) of this section must be
completed either in the English or
Spanish language. If the certification
or other information is completed in
Spanish, the importer must also provide to the port director, upon request,
a written English translation of the
certification or other information.
(e) Applicability of certification. A certification may be applicable to:
(1) A single importation of a good
into the United States, including a single shipment that results in the filing
of one or more entries and a series of
shipments that results in the filing of
one entry; or
(2) Multiple importations of identical
goods into the United States that
occur within a specified blanket period,
not exceeding 12 months. In the case of
multiple shipments of identical goods,
the certification must specify the blanket period in ‘‘mm/dd/yyyy to mm/dd/
yyyy’’ format.
(f) Preference criteria. The preference
criterion to be included on the certification or other information as required
in paragraph (a)(2)(vi) of this section is
as follows:
(1) Preference criterion ‘‘A’’, refers to
a good that is wholly obtained or produced entirely in the territory of Chile

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U.S. Customs and Border Protection, DHS; Treasury

§ 10.414

or of the United States, or both (see
General Note 26(b)(i), HTSUS);
(2) Preference criterion ‘‘B’’, refers to
a good that is produced entirely in the
territory of Chile or the United States,
or both (see General Note 26(b)(ii),
HTSUS), and
(i) Each of the non-originating materials used in the production of the good
undergoes an applicable change in tariff classification specified in General
Note 26(n), HTSUS, or
(ii) The good otherwise satisfies any
applicable regional value content or
other requirements specified in General Note 26(n), HTSUS;
(3) Preference criterion ‘‘C’’ refers to a
good that is produced entirely in the
territory of Chile or the United States,
or both, exclusively from originating
materials (see General Note 26(b)(iii),
HTSUS).

other information as set forth in
§ 10.411 of this subpart; and
(2) May be required to demonstrate
that the conditions set forth in § 10.463
of this subpart were met if the imported article was shipped through an
intermediate country.
(c) Information provided by exporter or
producer. The fact that the importer
has issued a certification based on information provided by the exporter or
producer will not relieve the importer
of the responsibility referred to in
paragraph (a) of this section. A U.S.
importer who voluntarily makes a corrected declaration will not be subject
to penalties for having made an incorrect declaration (see § 10.481 of this subpart).

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76132, Dec.
20, 2006; CBP Dec. 10–29, 75 FR 52450, Aug. 26,
2010]

§ 10.413 Validity of certification.
A certification that is completed,
signed and dated in accordance with
the requirements listed in § 10.411 of
this subpart will be accepted by CBP as
valid for four years from the date on
which the certification was signed. If
the port director determines that a certification is illegible or defective or
has not been completed in accordance
with § 10.411 of this subpart, the importer will be given a period of not less
than five business days to submit a
corrected certification.

§ 10.412 Importer obligations.
(a) General. An importer who makes a
declaration under § 10.410(a) of this subpart is responsible for the truthfulness
of the declaration and of all the information and data contained in the certification or other information submitted to CBP under § 10.411(a) of this
subpart, for submitting any supporting
documents requested by CBP, and for
the truthfulness of the information
contained in those documents. CBP
will allow for the direct submission by
the exporter or producer of business
confidential or other sensitive information, including cost and sourcing information.
(b) Compliance. In order to make a
claim for preferential treatment under
§ 10.410 of this subpart, the importer:
(1) Must have records that explain
how the importer came to the conclusion that the good qualifies for preferential
tariff
treatment.
Those
records must include documents that
support a claim that the article in
question qualifies for preferential tariff
treatment because it meets the applicable rules of origin set forth in General Note 26, HTSUS, and in this subpart. Those records may include a
properly completed certification or

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76132, Dec.
20, 2006]

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76132, Dec.
20, 2006]

§ 10.414 Certification or other information not required.
(a) General. Except as otherwise provided in paragraph (b) of this section,
an importer will not be required to submit a certification or other information demonstrating that the good
qualifies as originating under § 10.411(a)
of this subpart for:
(1) A non-commercial importation of
a good; or
(2) A commercial importation of a
good whose value does not exceed U.S.
$2,500, or the equivalent amount in
Chilean currency.
(b) Exception. If the port director determines that an importation described
in paragraph (a) of this section may

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§ 10.415

19 CFR Ch. I (4–1–11 Edition)

reasonably be considered to have been
carried out or planned for the purpose
of evading compliance with the rules
and procedures governing claims for
preference under the US-CFTA, the
port director will notify the importer
in writing that for that importation
the importer must submit to CBP a
valid certification or other information
demonstrating that the good qualifies
as originating. The importer must submit such a certification or other information within 30 calendar days from
the date of the written notice. Failure
to timely submit the certification or
other information will result in denial
of the claim for preferential tariff
treatment.
[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76132, Dec.
20, 2006]

§ 10.415 Maintenance of records.
(a) General. An importer claiming
preferential tariff treatment for a good
imported into the United States must
maintain, for five years after the date
of importation of the good, a certification (or a copy thereof) or other information demonstrating that the good
qualifies as originating, and any
records and documents that the importer has relating to the origin of the
good, including records and documents
associated with:
(1) The purchase of, cost of, value of,
and payment for, the good;
(2) Where appropriate, the purchase
of, cost of, value of, and payment for,
all materials, including recovered
goods and indirect materials, used in
the production of the good; and,
(3) Where appropriate, the production
of the good in the form in which the
good was exported.
(b) Method of maintenance. The
records referred to in paragraph (a) of
this section must be maintained by importers as provided in § 163.5 of this
chapter.
[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76133, Dec.
20, 2006]

§ 10.416 Effect of noncompliance; failure to provide documentation regarding transshipment.
(a) Effect of noncompliance. If the importer fails to comply with any re-

quirement under this subpart, including submission of a certification of origin
or
other
information
demonstrating that the good qualifies as
originating under § 10.411(a) of this subpart or submission of a corrected certification under § 10.413 of this subpart,
the port director may deny preferential
tariff treatment to the imported good.
(b) Failure to provide documentation regarding transshipment. Where the requirements for preferential tariff treatment set forth elsewhere in this subpart are met, the port director nevertheless may deny preferential tariff
treatment to an originating good if the
good is shipped through or transshipped in a country other than Chile
or the United States, and the importer
of the good does not provide, at the request of the port director, copies of
documents demonstrating to the satisfaction of the port director that the requirements set forth in § 10.463 of this
subpart were met.
[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76133, Dec.
20, 2006]

TARIFF PREFERENCE LEVEL
§ 10.420 Filing of claim for tariff preference level.
A cotton or man-made fiber fabric or
apparel good described in § 10.421 of this
subpart that does not qualify as an
originating good under § 10.451 of this
subpart may nevertheless be entitled
to preferential tariff treatment under
the US-CFTA under an applicable tariff
preference level (TPL). To make a TPL
claim, the importer must include on
the entry summary, or equivalent documentation, the applicable subheading
in Chapter 99 of the HTSUS (9911.99.20
for a good described in § 10.421(a) or (b)
of this subpart or 9911.99.40 for a good
described in § 10.421(c) of this subpart)
immediately above the applicable subheading in Chapter 52 through 62 of the
HTSUS under which each non-originating cotton or man-made fiber fabric
or apparel good is classified.
[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76133, Dec.
20, 2006]

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U.S. Customs and Border Protection, DHS; Treasury

§ 10.422

§ 10.421 Goods eligible for tariff preference claims.

CFTA, other than the condition that
they are originating goods.

The following goods are eligible for a
TPL claim filed under § 10.420 of this
subpart:
(a) Woven fabrics. Certain woven fabrics of Chapters 52, 54 and 55 of the
HTSUS (Headings 5208 to 5212; 5407 and
5408; 5512 to 5516) that meet the applicable conditions for preferential tariff
treatment under the US-CFTA other
than the condition that they are originating goods, if they are wholly formed
in the U.S. or Chile regardless of the
origin of the yarn used to produce
these fabrics.
(b) Cotton or man-made fabric goods.
Certain cotton or man-made fabric
goods of Chapters 58 and 60 of the
HTSUS that meet the applicable conditions for preferential tariff treatment
under the US-CFTA other than the
condition that they are originating
goods if they are wholly formed in the
U.S. or Chile regardless of the origin of
the fibers used to produce the spun
yarn or the yarn used to produce the
fabrics. 1
(c) Cotton or man-made apparel goods.
Cotton or man-made apparel goods in
Chapters 61 and 62 of the HTSUS that
are both cut (or knit-to-shape) and
sewn or otherwise assembled in the
U.S. or Chile regardless of the origin of
the fabric or yarn, provided that they
meet the applicable conditions for preferential tariff treatment under the US-

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76133, Dec.
20, 2006]

1 The relevant HTSUS subheadings for fabric goods in Chapters 58 or 60 eligible under
HTSUS 9911.99.20 are as follows: 5801.21,
5801.22, 5801.23, 5801.24, 5801.25, 5801.26, 5801.31,
5801.32, 5801.33, 5801.34, 5801.35, 5801.36, 5802.11,
5802.19,
5802.20.0020,
5802.30.0030,
5803.10,
5803.90.30,
5804.10.10,
5804.21,
5804.29.10,
5804.30.0020, 5805.00.30, 5805.00.4010, 5806.10.10,
5806.10.24, 5806.10.28, 5806.20, 5806.31, 5806.32,
5807.10.05, 5807.10.2010, 5807.10.2020, 5807.90.05,
5807.90.2010, 5807.90.2020, 5808.10.40, 5808.10.70,
5808.90.0010, 5809.00, 5810.10, 5810.91, 5810.92,
5811.00.20, 5811.00.30, 6001.10, 6001.21, 6001.22,
6001.91, 6001.92, 6002.40, 6002.90, 6003.20, 6003.30,
6003.40, 6004.10, 6004.90, 6005.21, 6005.22, 6005.23,
6005.24, 6005.31, 6005.32, 6005.33, 6005.34, 6005.41,
6005.42, 6005.43, 6005.44, 6006.21, 6006.22, 6006.23,
6006.24, 6006.31, 6006.32, 6006.33, 6006.34, 6006.41,
6006.42, 6006.43, 6006.44.

§ 10.422 Submission of certificate of
eligibility.
(a) Contents. An importer who claims
preferential tariff treatment on a nonoriginating cotton or man-made fiber
fabric or apparel good must submit, at
the request of the port director, a certificate of eligibility containing information demonstrating that the good
satisfies the requirements for entry
under the applicable TPL, as set forth
in § 10.421 of this subpart. A certificate
of eligibility submitted to CBP under
this section:
(1) Need not be in a prescribed format
but must be in writing or must be
transmitted electronically pursuant to
any electronic means authorized by
CBP for that purpose;
(2) Must include the following information:
(i) The legal name, address, telephone and e-mail address of the importer of record of the good;
(ii) The legal name and address of the
responsible official or authorized agent
of the importer signing the certificate
(if different from the importer of
record), and that person’s telephone
and e-mail address, if available;
(iii) The legal name, address, telephone and e-mail address of the exporter of the good (if different from the
producer);
(iv) The legal name, address, telephone and e-mail address of the producer of the good (if known);
(v) A description of the good, which
must be sufficiently detailed to relate
it to the invoice and the HS nomenclature;
(vi) The HTSUS tariff classification
of the good, to six or more digits, as
well as the applicable subheading in
Chapter 99 of the HTSUS (9911.99.20 or
9911.99.40);
(vii) For a single shipment, the commercial invoice number;
(viii) For multiple shipments of identical goods, the blanket period in ‘‘mm/
dd/yyyy to mm/dd/yyyy’’ format (12month maximum); and

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§ 10.423

19 CFR Ch. I (4–1–11 Edition)

(3) Must include a statement, in substantially the following form:

§ 10.423 Certificate of eligibility not required.

‘‘I Certify that:
The information on this document is true
and accurate and I assume the responsibility
for proving such representations. I understand that I am liable for any false statements or material omissions made on or in
connection with this document;
I agree to maintain and present upon request, documentation necessary to support
this certificate, and to inform, in writing, all
persons to whom the certificate was given of
any changes that could affect the accuracy
or validity of this certificate; and
The goods were produced in the territory
of one or more of the parties, and comply
with the preference requirements specified
for those goods in the United States-Chile
Free Trade Agreement and Chapter 99, subchapter XI of the HTSUS. There has been no
further production or any other operation
outside the territories of the parties, other
than unloading, reloading, or any other operation necessary to preserve it in good condition or to transport the good to the United
States; and
This document consists of ll pages, including all attachments.’’

(a) General. Except as otherwise provided in paragraph (b) of this section,
an importer will not be required to submit a certificate of eligibility for:
(1) A non-commercial importation of
a good; or
(2) A commercial importation of a
good whose value does not exceed U.S.
$2,500, or the equivalent amount in
Chilean currency.
(b) Exception. If the port director determines that an importation described
in paragraph (a) of this section may
reasonably be considered to have been
carried out or planned for the purpose
of evading compliance with the rules
and procedures governing TPL claims
for preference under the US-CFTA, the
port director will notify the importer
in writing that for that importation
the importer must submit to CBP a
valid certificate of eligibility. The importer must submit such a certificate
within 30 calendar days from the date
of the written notice. Failure to timely
submit the certificate will result in denial of the claim for preferential tariff
treatment.

(b) Responsible official or agent. The
certificate of eligibility required to be
submitted under this section must be
signed and dated by a responsible official of the importer or by the importer’s authorized agent having knowledge
of the relevant facts.
(c) Language. The certificate of eligibility must be completed either in the
English or Spanish language. If the certificate is completed in Spanish, the
importer must also provide to the port
director, upon request, a written
English translation of the certificate;
(d) Applicability of certificate of eligibility. A certificate of eligibility may
be applicable to:
(1) A single importation of a good
into the United States, including a single shipment that results in the filing
of one or more entries and a series of
shipments that results in the filing of
one entry; or
(2) Multiple importations of identical
goods into the United States that
occur within a specified blanket period,
not exceeding 12 months, set out in the
certificate.
[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76133, Dec.
20, 2006]

§ 10.424 Effect of noncompliance; failure to provide documentation regarding transshipment of non-originating cotton or man-made fiber
fabric or apparel goods.
(a) Effect of noncompliance. If the importer fails to comply with any requirement under this subpart, including submission of a certificate of eligibility under § 10.422 of this subpart, the
port director may deny preferential
tariff treatment to the imported good.
(b) Failure to provide documentation regarding transshipment. Where the requirements for preferential tariff treatment set forth elsewhere in this subpart are met, the port director nevertheless may deny preferential tariff
treatment to a good for which a TPL
claim is made if the good is shipped
through or transshipped in a country
other than Chile or the United States,
and the importer of the good does not
provide, at the request of the port director, copies of documents demonstrating to the satisfaction of the
port director that the requirements set

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U.S. Customs and Border Protection, DHS; Treasury
forth in § 10.425 of this subpart were
met.
[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76133, Dec.
20, 2006]

§ 10.425 Transit and transshipment of
non-originating cotton or manmade fiber fabric or apparel goods.
(a) General. A good will not be considered eligible for preferential tariff
treatment under an applicable TPL by
reason of having undergone production
that occurs entirely in the territory of
Chile, the United States, or both, that
would enable the good to qualify for
preferential tariff treatment if subsequent to that production the good undergoes further production or any
other operation outside the territories
of Chile and the United States, other
than unloading, reloading, or any other
process necessary to preserve the good
in good condition or to transport the
good to the territory of Chile or the
United States.
(b) Documentary evidence. An importer making a claim for preferential
tariff treatment may be required to
demonstrate, to CBP’s satisfaction,
that no further production or subsequent operation, other than permitted
under paragraph (a) of this section, occurred outside the territories of Chile
or the United States. An importer may
demonstrate compliance with this section by submitting documentary evidence. Such evidence may include, but
is not limited to, bills of lading, packing lists, commercial invoices, and customs entry and exit documents.
EXPORT REQUIREMENTS
§ 10.430 Export requirements.
(a) Submission of certification to CBP.
An exporter or producer in the United
States that signs a certification of origin for a good exported from the United
States to Chile must provide a copy of
the certification (or such other medium or format approved by the Chile
customs authority for that purpose) to
CBP upon request.
(b) Notification of errors in certification. An exporter or producer in the
United States who has completed and
signed a certification of origin, and
who has reason to believe that the cer-

§ 10.431

tification contains or is based on information that is not correct, must immediately after the date of discovery of
the error notify in writing all persons
to whom the certification was given by
the exporter or producer of any change
that could affect the accuracy or validity of the certification.
(c) Maintenance of records—(1) General. An exporter or producer in the
United States that signs a certification
of origin for a good exported from the
United States to Chile must maintain
in the United States, for a period of at
least five years after the date the certification was signed, all records and
supporting documents relating to the
origin of a good for which the certification was issued, including records
and documents associated with:
(i) The purchase of, cost of, value of,
and payment for, the good;
(ii) Where appropriate, the purchase
of, cost of, value of, and payment for,
all materials, including recovered
goods and indirect materials, used in
the production of the good; and
(iii) Where appropriate, the production of the good in the form in which
the good was exported.
(2) Method of maintenance. The
records referred to in paragraph (c) of
this section must be maintained in accordance with the Generally Accepted
Accounting Principles applied in the
country of production and in the case
of exporters or producers in the United
States must be maintained in the same
manner as provided in § 163.5 of this
chapter.
(3) Availability of records. For purposes of determining compliance with
the provisions of this part, the exporter’s or producer’s records required to
be maintained under this section must
be stored and made available for examination and inspection by the port director or other appropriate CBP officer
in the same manner as provided in part
163 of this chapter.
§ 10.431 Failure to comply with requirements.
The port director may apply such
measures as the circumstances may
warrant where an exporter or a producer in the United States fails to comply with any requirement of this part.

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§ 10.440

19 CFR Ch. I (4–1–11 Edition)

Such measures may include the imposition of penalties pursuant to 19
U.S.C. 1508(g) for failure to retain
records required to be maintained
under § 10.430.
POST-IMPORTATION DUTY REFUND
CLAIMS
§ 10.440 Right to make post-importation claim and refund duties.
Notwithstanding any other available
remedy, where a good would have
qualified as an originating good when
it was imported into the United States
but no claim for preferential tariff
treatment was made, the importer of
that good may file a claim for a refund
of any excess duties at any time within
one year after the date of importation
of the good in accordance with the procedures set forth in § 10.441 of this subpart. Subject to the provisions of
§ 10.416 of this subpart, CBP may refund
any excess duties by liquidation or reliquidation of the entry covering the
good in accordance with § 10.442(c) of
this part.
[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76133, Dec.
20, 2006]

§ 10.441 Filing procedures.
(a) Place of filing. A post-importation
claim for a refund under § 10.440 of this
subpart must be filed with the director
of the port at which the entry covering
the good was filed.
(b) Contents of claim. A post-importation claim for a refund must be filed by
presentation of the following:
(1) A written declaration stating that
the good qualified as an originating
good at the time of importation and
setting forth the number and date of
the entry or entries covering the good;
(2) Subject to § 10.413 of this subpart,
a copy of a certification of origin or
other information demonstrating that
the good qualifies for preferential tariff
treatment;
(3) A written statement indicating
whether or not the importer of the
good provided a copy of the entry summary or equivalent documentation to
any other person. If such documentation was so provided, the statement
must identify each recipient by name,
CBP identification number and address

and must specify the date on which the
documentation was provided; and
(4) A written statement indicating
whether or not any person has filed a
protest relating to the good under any
provision of law; and if any such protest has been filed, the statement must
identify the protest by number and
date.
[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76133, Dec.
20, 2006]

§ 10.442

CBP processing procedures.

(a) Status determination. After receipt
of a post-importation claim under
§ 10.441 of this subpart, the port director will determine whether the entry
covering the good has been liquidated
and, if liquidation has taken place,
whether the liquidation has become
final.
(b) Pending protest or judicial review. If
the port director determines that any
protest relating to the good has not
been finally decided, the port director
will suspend action on the claim for refund filed under this subpart until the
decision on the protest becomes final.
If a summons involving the tariff classification or dutiability of the good is
filed in the Court of International
Trade, the port director will suspend
action on the claim for refund filed
under this subpart until judicial review
has been completed.
(c) Allowance of claim—(1) Unliquidated entry. If the port director determines that a claim for a refund filed
under this subpart should be allowed
and the entry covering the good has
not been liquidated, the port director
will take into account the claim for refund under this subpart in connection
with the liquidation of the entry.
(2) Liquidated entry. If the port director determines that a claim for a refund filed under this subpart should be
allowed and the entry covering the
good has been liquidated, whether or
not the liquidation has become final,
the entry must be reliquidated in order
to effect a refund of duties pursuant to
this subpart. If the entry is otherwise
to be reliquidated based on administrative review of a protest or as a result of
judicial review, the port director will

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U.S. Customs and Border Protection, DHS; Treasury
reliquidate the entry taking into account the claim for refund under this
subpart.
(d) Denial of claim—(1) General. The
port director may deny a claim for a
refund filed under § 10.441 of this subpart if the claim was not filed timely,
if the importer has not complied with
the requirements of § 10.441 of this subpart, if the certification submitted
under § 10.441(b)(2) of this subpart cannot be accepted as valid (see § 10.413 of
this subpart), or if, following an origin
verification under § 10.470 of this subpart, the port director determines either that the imported good did not
qualify as an originating good at the
time of importation or that a basis exists upon which preferential tariff
treatment may be denied under § 10.470
of this subpart.
(2) Unliquidated entry. If the port director determines that a claim for a refund filed under this subpart should be
denied and the entry covering the good
has not been liquidated, the port director will deny the claim in connection
with the liquidation of the entry, and
notice of the denial and the reason for
the denial will be provided to the importer in writing or via an authorized
electronic data interchange system.
(3) Liquidated entry. If the port director determines that a claim for a refund filed under this subpart should be
denied and the entry covering the good
has been liquidated, whether or not the
liquidation has become final, the claim
may be denied without reliquidation of
the entry. If the entry is otherwise to
be reliquidated based on administrative review of a protest or as a result of
judicial review, such reliquidation may
include denial of the claim filed under
this subpart. In either case, the port director will give the importer notice of
the denial and the reason for the denial
in writing or via an authorized electronic data interchange system.
[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76133, Dec.
20, 2006; CBP Dec. 10–29, 75 FR 52450, Aug. 26,
2010]

RULES OF ORIGIN
§ 10.450 Definitions.
For purposes of §§ 10.450
10.463 of this subpart:

through

§ 10.450

(a) Adjusted value. ‘‘Adjusted value’’
means the value determined in accordance with Articles 1 through 8, Article
15, and the corresponding interpretative notes of the Customs Valuation
Agreement, adjusted, if necessary, to
exclude any costs, charges, or expenses
incurred for transportation, insurance,
and related services incident to the
international shipment of the merchandise from the country of exportation to the place of importation and
the value of packing materials and
containers for shipment as defined in
§ 10.450(m) of this subpart;
(b) Exporter. ‘‘Exporter’’ means a person who exports goods from the territory of a Party;
(c) Fungible goods or materials. ‘‘Fungible goods or materials’’ means goods
or materials that are interchangeable
for commercial purposes and whose
properties are essentially identical;
(d) Generally Accepted Accounting
Principles. ‘‘Generally Accepted Accounting Principles’’ means the principles, rules, and procedures, including
both broad and specific guidelines, that
define the accounting practices accepted in the territory of a Party;
(e) Good. ‘‘Good’’ means any merchandise, product, article, or material;
(f) Goods wholly obtained or produced
entirely in the territory of one or both of
the Parties. ‘‘Goods wholly obtained or
produced entirely in the territory of
one or both of the Parties’’ means:
(1) Mineral goods extracted in the
territory of one or both of the Parties;
(2) Vegetable goods, as such goods are
defined in the Harmonized System,
harvested in the territory of one or
both of the Parties;
(3) Live animals born and raised in
the territory of one or both of the Parties;
(4) Goods obtained from hunting,
trapping, or fishing in the territory of
one or both of the Parties;
(5) Goods (fish, shellfish, and other
marine life) taken from the sea by vessels registered or recorded with a Party
and flying its flag;
(6) Goods produced on board factory
ships from the goods referred to in
paragraph (f)(5) provided such factory
ships are registered or recorded with
that Party and fly its flag;

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§ 10.451

19 CFR Ch. I (4–1–11 Edition)

(7) Goods taken by a Party or a person of a Party from the seabed or beneath the seabed outside territorial
waters, provided that a Party has
rights to exploit such seabed;
(8) Goods taken from outer space,
provided they are obtained by a Party
or a person of a Party and not processed in the territory of a non-Party;
(9) Waste and scrap derived from:
(i) Production in the territory of one
or both of the Parties, or
(ii) Used goods collected in the territory of one or both of the Parties, provided such goods are fit only for the recovery of raw materials;
(10) Recovered goods derived in the
territory of a Party from used goods,
and utilized in the Party’s territory in
the production of remanufactured
goods; and
(11) Goods produced in the territory
of one or both of the Parties exclusively from goods referred to in paragraphs (f)(1) through (f)(10) of this section, or from their derivatives, at any
stage of production;
(g) Importer. ‘‘Importer’’ means a person who imports goods into the territory of a Party;
(h) Issued. ‘‘Issued’’ means prepared by
and, where required under a Party’s domestic law or regulation, signed by the
importer, exporter, or producer of the
good;
(i) Location of the producer. ‘‘Location
of the producer’’ means site of production of a good;
(j) Material. ‘‘Material’’ means a good
that is used in the production of another good, including a part, ingredient, or indirect material;
(k) Non-originating good. ‘‘Non-originating good’’ means a good that does
not qualify as originating under this
subpart;
(l) Non-originating material. ‘‘Non-originating material’’ means a material
that does not qualify as originating
under this subpart;
(m) Packing materials and containers
for shipment. ‘‘Packing materials and
containers for shipment’’ means the
goods used to protect a good during its
transportation to the United States,
and does not include the packaging materials and containers in which a good
is packaged for retail sale;

(n) Producer. ‘‘Producer’’ means a person who engages in the production of a
good in the territory of a Party;
(o) Production. ‘‘Production’’ means
growing, mining, harvesting, fishing,
raising, trapping, hunting, manufacturing, processing, assembling, or disassembling a good;
(p) Recovered goods. ‘‘Recovered goods’’
means materials in the form of individual parts that are the result of:
(1) The complete disassembly of used
goods into individual parts; and
(2) The cleaning, inspecting, testing,
or other processing of those parts as
necessary for improvement to sound
working condition by one or more of
the following processes: welding, flame
spraying, surface machining, knurling,
plating, sleeving, and rewinding in
order for such parts to be assembled
with other parts, including other recovered parts in the production of a remanufactured good of Annex 4.18, USCFTA;
(q) Remanufactured goods. ‘‘Remanufactured goods’’ means industrial goods
assembled in the territory of a Party,
listed in Annex 4.18, US-CFTA, that:
(1) Are entirely or partially comprised of recovered goods;
(2) Have the same life expectancy and
meet the same performance standards
as new goods; and
(3) Enjoy the same factory warranty
as such new goods; and
(r) Self-produced material. ‘‘Self-produced material’’ means a material that
is produced by the producer of a good
and used in the production of that
good; and
(s) Value. ‘‘Value’’ means the value of
a good or material for purposes of calculating customs duties or for purposes
of applying this subpart.
[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76133, Dec.
20, 2006]

§ 10.451

Originating goods.

A good imported into the customs
territory of the United States will be
considered an originating good under
the US-CFTA only if:
(a) The good is wholly obtained or
produced entirely in the territory of
Chile or of the United States, or both;
or

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U.S. Customs and Border Protection, DHS; Treasury
(b) The good is produced entirely in
the territory of Chile or of the United
States, or both, satisfies all other applicable requirements of this subpart,
and
(1) Each of the non-originating materials used in the production of the good
undergoes an applicable change in tariff classification specified in General
Note 26(n), HTSUS, and
(2) The good otherwise satisfies any
applicable regional value content or
other requirements specified in General Note 26(n), HTSUS; or
(c) The good is produced entirely in
the territory of Chile or the United
States, or both, exclusively from originating materials.
§ 10.452

(a) Build-down method. For the builddown method, the regional value content must be calculated on the basis of
the formula RVC = ((AV–VNM)/AV) ×
100, where RVC is the regional value
content, expressed as a percentage; AV
is the adjusted value; and VNM is the
value of non-originating materials used
by the producer in the production of
the good; or
(b) Build-up method. For the build-up
method, the regional value content
must be calculated on the basis of the
formula RVC = (VOM/AV) × 100, where
RVC is the regional value content, expressed as a percentage; AV is the adjusted value; and VOM is the value of
originating materials used by the producer in the production of the good.

Exclusions.

A good will not be considered to be
an originating good and a material will
not be considered to be an originating
material by virtue of having undergone:
(a) Simple combining or packaging
operations; or
(b) Mere dilution with water or with
another substance that does not materially alter the characteristics of the
good or material.
§ 10.453 Treatment of textile and apparel sets.
Notwithstanding the specific rules
specified in General Note 26(n), HTSUS,
textile and apparel goods classifiable
as goods put up in sets for retail sale as
provided for in General Rule of Interpretation 3, HTSUS, will not be regarded as originating goods unless each
of the goods in the set is an originating
good or the non-originating goods in
the set do not exceed 10 percent of the
adjusted value of the set.
§ 10.454

§ 10.455

Regional value content.

Where General Note 26, subdivision
(n), HTSUS, sets forth a rule that
specifies a regional value content test
for a good, the regional value content
of such good may be calculated, at the
choice of the person claiming the tariff
treatment authorized by this note for
such good, on the basis of the builddown method or the build-up method
described in this section, unless otherwise specified in the note.

§ 10.455

Value of materials.

(a) Calculating the regional value content. For purposes of calculating the regional value content of a good under
General Note 26(n), HTSUS, and for
purposes of applying the de minimis (see
§ 10.459) provisions of subdivision (e) of
the note, the value of a material is:
(1) In the case of a material imported
by the producer of the good, the adjusted value of the material with respect to that importation;
(2) In the case of a material acquired
in the territory where the good is produced, except for a material to which
paragraph (a)(3) of this section applies,
the producer’s price actually paid or
payable for the material;
(3) In the case of a material provided
to the producer without charge, or at a
price reflecting a discount or similar
reduction, the sum of—
(i) All expenses incurred in the
growth, production or manufacture of
the material, including general expenses, and
(ii) A reasonable amount for profit;
or
(4) In the case of a material that is
self-produced, the sum of—
(i) All expenses incurred in the production of the material, including general expenses, and
(ii) A reasonable amount for profit.
(b) Permissible additions to, and deductions from, the value of materials. The
value of materials may be adjusted as
follows:

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§ 10.456

19 CFR Ch. I (4–1–11 Edition)

(1) For originating materials, the following expenses, if not included under
paragraph (a) of this section, may be
added to the value of the originating
material:
(i) The costs of freight, insurance,
packing and all other costs incurred in
transporting the material to the location of the producer;
(ii) Duties, taxes and customs brokerage fees on the material paid in the
territory of Chile or of the United
States, or both, other than duties and
taxes that are waived, refunded, refundable or otherwise recoverable, including credit against duty or tax paid
or payable; and
(iii) The cost of waste and spoilage
resulting from the use of the material
in the production of the good, less the
value of renewable scrap or by-product;
and
(2) For non-originating materials, if
included under paragraph (a) of this
section, the following expenses may be
deducted from the value of the nonoriginating material:
(i) The costs of freight, insurance,
packing and all other costs incurred in
transporting the material to the location of the producer;
(ii) Duties, taxes and customs brokerage fees on the material paid in the
territory of Chile or of the United
States, or both, other than duties and
taxes that are waived, refunded, refundable or otherwise recoverable, including credit against duty or tax paid
or payable;
(iii) The cost of waste and spoilage
resulting from the use of the material
in the production of the good, less the
value of renewable scrap or by-products; and
(iv) The cost of originating materials
used in the production of the non-originating material in the territory of
Chile or of the United States.
(c) Accounting method. Any cost or
value referenced in General Note 26(n),
HTSUS, and this subpart, must be recorded and maintained in accordance
with the generally accepted accounting
principles applicable in the territory of
the Party in which the good is pro-

duced (whether Chile or the United
States).
[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76133, Dec.
20, 2006]

§ 10.456 Accessories, spare parts or
tools.
Accessories, spare parts or tools that
form part of the good’s standard accessories, spare parts or tools and are delivered with the good will be treated as
a material used in the production of
the good, if—
(a) The accessories, spare parts or
tools are classified with and not
invoiced separately from the good; and
(b) The quantities and value of the
accessories, spare parts or tools are
customary for the good.
§ 10.457 Fungible goods and materials.
(a) A person claiming preferential
tariff treatment under the US-CFTA
for a good may claim that a fungible
good or material is originating either
based on the physical segregation of
each fungible good or material or by
using an inventory management method. For purposes of this subpart, the
term ‘‘inventory management method’’
means—
(1) Averaging,
(2) ‘‘Last-in, first-out,’’
(3) ‘‘First-in, first-out,’’ or
(4) Any other method that is recognized in the generally accepted accounting principles of the Party in
which the production is performed
(whether Chile or the United States) or
otherwise accepted by that Party.
(b) A person selecting an inventory
management method under paragraph
(a) of this section for particular fungible goods or materials must continue
to use that method for those fungible
goods or materials throughout the fiscal year of that person.
[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76134, Dec.
20, 2006]

§ 10.458 Accumulation.
(a) Originating goods or materials of
Chile or the United States that are incorporated into a good in the territory
of the other Party will be considered to
originate in the territory of the other
Party for purposes of determining the

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U.S. Customs and Border Protection, DHS; Treasury
eligibility of the goods or materials for
preferential tariff treatment under the
US-CFTA.
(b) A good that is produced in the
territory of Chile, the United States, or
both, by one or more producers, will be
considered as an originating good if the
good satisfies the applicable requirements of § 10.451 and General Note 26,
HTSUS.
[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76134, Dec.
20, 2006]

§ 10.459 De minimis.
(a) Except as provided in paragraphs
(b) and (c) of this section, a good that
does not undergo a change in tariff
classification pursuant to General Note
26(n), HTSUS, will nonetheless be considered to be an originating good if—
(1) The value of all non-originating
materials that are used in the production of the good and do not undergo the
applicable change in tariff classification does not exceed 10 percent of the
adjusted value of the good;
(2) The value of such non-originating
materials is included in calculating the
value of non-originating materials for
any applicable regional value-content
requirement under this note; and
(3) The good meets all other applicable requirements of General Note 26(n),
HTSUS.
(b) Paragraph (a) of this section does
not apply to:
(1) A non-originating material provided for in Chapter 4 of the Harmonized System, or a non-originating
dairy preparation containing over 10
percent by weight of milk solids provided for in subheadings 1901.90 or
2106.90 of the Harmonized System, that
is used in the production of a good provided for in Chapter 4 of the Harmonized System;
(2) A non-originating material provided for in Chapter 4 of the Harmonized System, or non-originating
dairy preparations containing over 10
percent by weight of milk solids provided for in subheading 1901.90 of the
Harmonized System, that are used in
the production of the following goods:
infant preparations containing over 10
percent in weight of milk solids provided for in subheading 1901.10 of the
Harmonized System; mixes and doughs,

§ 10.459

containing over 25 percent by weight of
butterfat, not put up for retail sale,
provided for in subheading 1901.20 of
the Harmonized System; dairy preparations containing over 10 percent by
weight of milk solids provided for in
subheadings 1901.90 or 2106.90 of the
Harmonized System; goods provided for
in heading 2105 of the Harmonized System; beverages containing milk provided for in subheading 2202.90 of the
Harmonized System; or animal feeds
containing over 10 percent by weight of
milk solids provided for in subheading
2309.90 of the Harmonized System;
(3) A non-originating material provided for in heading 0805 of the Harmonized System or subheadings 2009.11
through 2009.30 of the Harmonized System that is used in the production of a
good provided for in subheadings 2009.11
through 2009.30 of the Harmonized System, or in fruit or vegetable juice of
any single fruit or vegetable, fortified
with minerals or vitamins, concentrated or unconcentrated, provided
for in subheadings 2106.90 or 2202.90 of
the Harmonized System;
(4) A non-originating material provided for in Chapter 15 of the Harmonized System that is used in the
production of a good provided for in
headings 1501 through 1508, 1512, 1514, or
1515 of the Harmonized System;
(5) A non-originating material provided for in heading 1701 of the Harmonized System that is used in the
production of a good provided for in
headings 1701 through 1703 of the Harmonized System;
(6) A non-originating material provided for in Chapter 17 or in heading
1805 of the Harmonized System that is
used in the production of a good provided for in subheading 1806.10 of the
Harmonized System;
(7) A non-originating material provided for in headings 2203 through 2208
of the Harmonized System that is used
in the production of a good provided for
in heading 2207 or 2208 of the Harmonized System; and
(8) A non-originating material used
in the production of a good provided for
in Chapters 1 through 21 of the Harmonized System unless the non-originating material is provided for in a different subheading than the good for

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§ 10.460

19 CFR Ch. I (4–1–11 Edition)

which origin is being determined under
this section.
(c) A textile or apparel good provided
for in Chapters 50 through 63 of the
Harmonized System that is not an
originating good because certain fibers
or yarns used in the production of the
component of the good that determines
the tariff classification of the good do
not undergo an applicable change in
tariff classification set out in General
Note 26(n), HTSUS, shall nonetheless
be considered to be an originating good
if the total weight of all such fibers or
yarns in that component is not more
than seven percent of the total weight
of that component. A good containing
elastomeric yarns in the component of
the good that determines the tariff
classification of the good shall be considered to be an originating good only
if such yarns are wholly formed in the
territory of a Party. For purposes of
this paragraph, if a good is a fiber,
yarn or fabric, the component of the
good that determines the tariff classification of the good is all of the fibers
in the yarn, fabric or group of fibers.
§ 10.460

Indirect materials.

An indirect material, as defined in
§ 10.402(o), will be considered to be an
originating material without regard to
where it is produced.
Example. Chilean Producer C produces good
C using non-originating material A. Producer C imports non-originating rubber
gloves for use by workers in the production
of good C. Good C is subject to a tariff shift
requirement. As provided in § 10.451(b)(1) and
General Note 26(n), each of the non-originating materials in good C must undergo the
specified change in tariff classification in
order for good C to be considered originating.
Although non-originating material A must
undergo the applicable tariff shift in order
for good C to be considered originating, the
rubber gloves do not because they are indirect materials and are considered originating without regard to where they are produced.
[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76134, Dec.
20, 2006]

§ 10.461 Retail packaging
and containers.

materials

Packaging materials and containers
in which a good is packaged for retail
sale, if classified with the good for

which preferential tariff treatment
under the US-CFTA is claimed, will be
disregarded in determining whether all
non-originating materials used in the
production of the good undergo the applicable change in tariff classification
set out in General Note 26(n), HTSUS.
If the good is subject to a regional
value content requirement, the value
of such packaging materials and containers will be taken into account as
originating or non-originating materials, as the case may be, in calculating
the regional value content of the good.
Example 1. Chilean Producer A of good C
imports 100 non-originating blister packages
to be used as retail packaging for good C. As
provided in § 10.455(a)(1), the value of the blister packages is their adjusted value, which
in this case is $10. Good C has a regional
value content requirement. The United
States importer of good C decides to use the
build-down method, RVC = ((AV–VNM)/AV) ×
100 (see § 10.454(a) of this subpart), in determining whether good C satisfies the regional
value content requirement. In applying this
method, the non-originating blister packages
are taken into account as non-originating.
As such, their $10 adjusted value is included
in the VNM, value of non-originating materials, of good C.
Example 2. Same facts as in Example 1, but
the blister packages are originating. In this
case, the adjusted value of the originating
blister packages would not be included as
part of the VNM of good C under the builddown method. However, if the United States
importer had used the build-up method, RVC
= (VOM/AV) × 100 (see § 10.454(b)), the adjusted
value of the blister packaging would be included as part of the VOM, value of originating material.
[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76134, Dec.
20, 2006]

§ 10.462 Packing materials and containers for shipment.
(a) Packing materials and containers
for shipment, as defined in § 10.450(m),
are to be disregarded in determining
whether the non-originating materials
used in the production of the good undergo an applicable change in tariff
classification set out in General Note
26(n), HTSUS. Accordingly, such materials and containers do not have to undergo the applicable change in tariff
classification even if they are non-originating.
(b) Packing materials and containers
for shipment, as defined in § 10.450(m),

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U.S. Customs and Border Protection, DHS; Treasury

§ 10.470

are to be disregarded in determining
the regional value content of a good
imported into the United States. Accordingly, in applying either the builddown or build-up method for determining the regional value content of
the good imported into the United
States, the value of such packing materials and containers for shipment
(whether originating or non-originating) is disregarded and not included
in AV, adjusted value, VNM, value of
non-originating materials, or VOM,
value of originating materials.

outside the territories of Chile or the
United States. An importer may demonstrate compliance with this section
by submitting documentary evidence.
Such evidence may include, but is not
limited to, bills of lading, packing
lists, commercial invoices, and customs entry and exit documents.

Example. Chilean Producer A produces good
C. Producer A ships good C to the United
States in a shipping container which it purchased from Company B in Chile. The shipping container is originating. The value of
the shipping container determined under section § 10.455(a)(2) is $3. Good C is subject to a
regional value content requirement. The
transaction value of good C is $100, which includes the $3 shipping container. The U.S.
importer decides to use the build-up method,
RVC = (VOM/AV) × 100 (see § 10.454(b)), in determining whether good C satisfies the regional value content requirement. In determining the AV, adjusted value, of good C imported into the U.S., paragraph (b) of this
section requires a $3 deduction for the value
of the shipping container. Therefore, the AV
is $97 ($100–$3). In addition, the value of the
shipping container is disregarded and not included in the VOM, value of originating materials.

(a) Verification. A claim for preferential tariff treatment made under
§ 10.410 or § 10.442 of this subpart, including any statements or other information submitted to CBP in support of
the claim, will be subject to such
verification as the port director deems
necessary. In the event that the port
director is provided with insufficient
information to verify or substantiate
the claim, the port director may deny
the claim for preferential tariff treatment. A verification of a claim for
preferential treatment may involve,
but is not limited to, a review of:
(1) All records required to be made,
kept, and made available to CBP by the
importer or any other person under
part 163 of this chapter;
(2) Documentation and other information regarding the country of origin
of an article and its constituent materials, including, but not limited to,
production records, supporting accounting and financial records, information relating to the place of production, the number and identification of
the types of machinery used in production, and the number of workers employed in production; and
(3) Evidence that documents the use
of U.S. or Chilean materials in the production of the article subject to the
verification, such as purchase orders,
invoices, bills of lading and other shipping documents, customs import and
clearance documents, and bills of material and inventory records.
(b) Applicable accounting principles.
When conducting a verification of origin to which Generally Accepted Accounting Principles may be relevant,
CBP will apply and accept the Generally Accepted Accounting Principles

§ 10.463 Transit and transshipment.
(a) General. A good will not be considered an originating good by reason of
having undergone production that occurs entirely in the territory of Chile,
the United States, or both, that would
enable the good to qualify as an originating good if subsequent to that production the good undergoes further
production or any other operation outside the territories of Chile and the
United States, other than unloading,
reloading, or any other process necessary to preserve the good in good
condition or to transport the good to
the territory of Chile or the United
States.
(b) Documentary evidence. An importer making a claim that a good is
originating may be required to demonstrate, to CBP’s satisfaction, that no
further production or subsequent operation, other than permitted under
paragraph (a) of this section, occurred

ORIGIN VERIFICATIONS AND
DETERMINATIONS
§ 10.470 Verification and justification
of claim for preferential treatment.

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§ 10.471

19 CFR Ch. I (4–1–11 Edition)

applicable in the country of production.
[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76134, Dec.
20, 2006; CBP Dec. 10–29, 75 FR 52450, Aug. 26,
2010]

§ 10.471 Special rule for verifications
in Chile of U.S. imports of textile
and apparel products.
(a) Procedures to determine whether a
claim of origin is accurate. For the purpose of determining that a claim of origin for a textile or apparel good is accurate, CBP may request that the government
of
Chile
conduct
a
verification, regardless of whether a
claim is made for preferential tariff
treatment. While a verification under
this paragraph is being conducted, CBP
may take appropriate action, as directed by The Committee for the Implementation of Textile Agreements
(CITA), which may include suspending
the application of preferential treatment to the textile or apparel good for
which a claim of origin has been made.
If CBP is unable to make the determination described in this paragraph
within 12 months after a request for a
verification, CBP may take appropriate action with respect to the textile and apparel good subject to the
verification, and with respect to similar goods exported or produced by the
entity that exported or produced the
good, if directed by CITA.
(b) Procedures to determine compliance
with applicable customs laws and regulations of the U.S. For purposes of enabling CBP to determine that an exporter or producer is complying with
applicable customs laws, regulations,
and procedures in cases in which CBP
has a reasonable suspicion that a Chilean exporter or producer is engaging in
unlawful activity relating to trade in
textile and apparel goods, CBP may request that the government of Chile
conduct a verification, regardless of
whether a claim is made for preferential tariff treatment. A ‘‘reasonable
suspicion’’ for the purpose of this paragraph will be based on relevant factual
information, including information of
the type set forth in Article 5.5 of the
US-CFTA, that indicates circumvention of applicable laws, regulations or
procedures regarding trade in textile

and apparel goods. CBP may undertake
or assist in a verification under this
paragraph by conducting visits in
Chile, along with the competent authorities of Chile, to the premises of an
exporter, producer or any other enterprise involved in the movement of textile or apparel goods from Chile to the
United States. While a verification
under this paragraph is being conducted, CBP may take appropriate action, as directed by CITA, which may
include suspending the application of
preferential tariff treatment to the
textile and apparel goods exported or
produced by the Chilean entity where
the reasonable suspicion of unlawful
activity relates to those goods. If CBP
is unable to make the determination
described in this paragraph within 12
months
after
a
request
for
a
verification, CBP may take appropriate action with respect to any textile or apparel goods exported or produced by the entity subject to the
verification, if directed by CITA.
(c) Assistance by CBP to Chilean authorities. CBP may undertake or assist
in a verification under this section by
conducting visits in Chile, along with
the competent authorities of Chile, to
the premises of an exporter, producer
or any other enterprise involved in the
movement of textile or apparel goods
from Chile to the United States.
(d) Treatment of documents and information provided to CBP. Any production, trade and transit documents and
other information necessary to conduct
a verification under this section, provided to CBP by the government of
Chile consistent with the laws, regulations, and procedures of Chile, will be
considered confidential as provided for
in Article 5.6 of the US-CFTA.
(e) Notification to Chile. Prior to commencing appropriate action under
paragraph (a) or (b) of this section,
CBP will notify the government of
Chile. CBP may continue to take appropriate action under paragraph (a) or
(b) of this section until it receives information sufficient to enable it to
make the determination described in
paragraphs (a) and (b) of this section.
(f) Retention of authority by CBP. If
CBP requests a verification before
Chile fully implements its obligations
under Article 3.21 of the US-CFTA, the

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U.S. Customs and Border Protection, DHS; Treasury
verification will be conducted principally by CBP, including through
means described in paragraphs (a) and
(b) of this section. CBP retains the authority to exercise its rights under
paragraphs (a) and (b) of this section.
§ 10.472 Verification in the United
States of textile and apparel goods.
(a) Procedures to determine whether a
claim of origin is accurate. CBP will endeavor, at the request of the government of Chile, to conduct a verification
for the purpose of determining that a
claim of origin for a textile or apparel
good is accurate. A verification will be
conducted under this paragraph regardless of whether a claim is made for
preferential tariff treatment. If the
government of Chile is unable to make
the determination described in this
paragraph within 12 months after a request for a verification, Chile may take
appropriate action with respect to the
textile and apparel good subject to the
verification, and with respect to similar goods exported or produced by the
entity that exported or produced the
good.
(b) Procedures to determine compliance
with applicable customs laws and regulations of Chile. CBP will endeavor to conduct a verification at the request of the
government of Chile for purposes of enabling Chile to determine that the U.S.
exporter or producer is complying with
applicable customs laws, regulations,
and procedures, if Chile has a reasonable suspicion that a U.S. exporter or
producer is engaging in unlawful activity relating to trade in textile and apparel goods. A verification will be conducted under this paragraph regardless
of whether a claim is made for preferential tariff treatment. A ‘‘reasonable
suspicion’’ for the purpose of this paragraph will be based on relevant factual
information, including information of
the type set forth in Article 5.5 of the
US-CFTA, that indicates circumvention of applicable laws, regulations or
procedures regarding trade in textile
and apparel goods. If the government of
Chile is unable to make the determination described in this paragraph within
12 months after a request for a
verification, it may take action as permitted under its laws with respect to
any textile or apparel goods exported

§ 10.473

or produced by the entity subject to
the verification.
(c) Visits by CBP. CBP may conduct
visits to the premises of a U.S. exporter or producer or any other enterprise involved in the movement of textile or apparel goods from the United
States to Chile in order to undertake
or assist in a verification pursuant to
paragraphs (a) and (b) of this section.
(d) Initiation of verification by CBP.
CBP may conduct, on its own initiative, a verification for the purpose of
determining that a claim of origin for
a textile or apparel good is accurate.
(e) Treatment of documents and information. CBP will endeavor to provide to
the government of Chile, consistent
with U.S. laws, regulations, and procedures, production, trade, and transit
documents and other information necessary to conduct a verification under
paragraphs (a) and (b) of this section.
Such information will be considered
confidential as provided for in Article
5.6 of the US-CFTA.
§ 10.473 Issuance of negative origin determinations.
If CBP determines, as a result of an
origin verification initiated under this
subpart, that the good which is the
subject of the verification does not
qualify as an originating good, it will
issue a determination in writing or via
an authorized electronic data interchange system to the importer that
sets forth the following:
(a) A description of the good that was
the subject of the verification together
with the identifying numbers and dates
of the export and import documents
pertaining to the good;
(b) A statement setting forth the
findings of fact made in connection
with the verification and upon which
the determination is based;
(c) With specific reference to the
rules applicable to originating goods as
set forth in General Note 26, HTSUS,
and in §§ 10.450 through 10.463 of this
subpart, the legal basis for the determination; and
(d) A notice of intent to deny preferential tariff treatment on the good

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§ 10.474

19 CFR Ch. I (4–1–11 Edition)

which is the subject of the determination.

§ 10.483 Framework for correcting declarations and certifications.

[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76134, Dec.
20, 2006]

(a) ‘‘Voluntarily’’ defined. For purposes
of this subpart, the making of a corrected declaration or the providing of
written notification of an incorrect
certification will be deemed to have
been done voluntarily if:
(1) Done before the commencement of
a formal investigation; or
(2) Done before any of the events
specified in § 162.74(i) of this chapter
have occurred; or
(3) Done within 30 calendar days after
either the U.S. importer, exporter or
producer had reason to believe that the
declaration or certification was not
correct; and is
(4) Accompanied by a written statement setting forth the information
specified in paragraph (c) of this section; and
(5) In the case of a corrected declaration, accompanied or followed by a tender of any actual loss of duties and
merchandise processing fees, if applicable, in accordance with paragraph (e) of
this section.
(b) Cases involving fraud. Notwithstanding paragraph (a) of this section,
a person who acted fraudulently in
making an incorrect declaration or
certification may not make a voluntary correction. For purposes of this
paragraph, the term ‘‘fraud’’ will have
the meaning set forth in paragraph
(B)(3) of appendix B to part 171 of this
chapter.
(c) Statement. For purposes of this
subpart, each corrected declaration or
notification of an incorrect certification must be accompanied by a statement, submitted in writing or via an
authorized electronic data interchange
system, which:
(1) Identifies the class or kind of good
to which the incorrect declaration or
certification relates;
(2) In the case of a corrected declaration, identifies each affected import
transaction, including each port of importation and the approximate date of
each importation, and in the case of a
notification of an incorrect certification, identifies each affected exportation transaction, including each port
of exportation and the approximate

§ 10.474 Repeated false or unsupported
preference claims.
Where verification or other information reveals indications of a pattern of
conduct by an importer of false or unsupported representations that a good
imported into the United States qualifies as originating, CBP may deny subsequent claims for preferential tariff
treatment on identical goods imported
by that person until compliance with
the rules applicable to originating
goods as set forth in General Note 26,
HTSUS is established to the satisfaction of CBP.
[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76134, Dec.
20, 2006]

PENALTIES
§ 10.480 General.
Except as otherwise provided in this
subpart, all criminal, civil or administrative penalties which may be imposed on U.S. importers, exporters and
producers for violations of the customs
and related laws and regulations will
also apply to U.S. importers, exporters
and producers for violations of the laws
and regulations relating to the USCFTA.
§ 10.481 Corrected declaration by importers.
A U.S. importer who makes a corrected declaration under § 10.410(b) will
not be subject to civil or administrative penalties for having made an incorrect declaration, provided that the
corrected declaration was voluntarily
made.
§ 10.482 Corrected certifications of origin by exporters or producers.
Civil or administrative penalties provided for under the U.S. customs laws
and regulations will not be imposed on
an exporter or producer in the United
States who voluntarily provides written notification pursuant to § 10.430(b)
with respect to the making of an incorrect certification.

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U.S. Customs and Border Protection, DHS; Treasury
date of each exportation. A U.S. producer who provides written notification that certain information in a certification of origin is incorrect and who
is unable to identify the specific export
transactions under this paragraph
must provide as much information concerning those transactions as the producer, by the exercise of good faith and
due diligence, is able to obtain;
(3) Specifies the nature of the incorrect statements or omissions regarding
the declaration or certification; and
(4) Sets forth, to the best of the person’s knowledge, the true and accurate
information or data which should have
been covered by or provided in the declaration or certification, and states
that the person will provide any additional pertinent information or data
which is unknown at the time of making the corrected declaration or certification within 30 calendar days or within any extension of that 30-day period
as CBP may permit in order for the
person to obtain the information or
data.
(d) Substantial compliance. For purposes of this section, a person will be
deemed to have voluntarily corrected a
declaration
or
certification
even
though that person provides corrected
information in a manner which does
not conform to the requirements of the
written statement specified in paragraph (c) of this section, provided that:
(1) CBP is satisfied that the information was provided before the commencement of a formal investigation;
and
(2) The information provided includes, orally or in writing, substantially the same information as that
specified in paragraph (c) of this section.
(e) Tender of actual loss of duties. A
U.S. importer who makes a corrected
declaration must tender any actual
loss of duties at the time of making the
corrected declaration, or within 30 calendar days thereafter, or within any
extension of that 30-day period as CBP
may allow in order for the importer to
obtain the information or data necessary to calculate the duties owed.
(f) Applicability of prior disclosure provisions. Where a person fails to meet
the requirements of this section because the correction of the declaration

§ 10.490

or the written notification of an incorrect certification is not considered to
be done voluntarily as provided in this
section, that person may nevertheless
qualify for prior disclosure treatment
under 19 U.S.C. 1592(c)(4) and § 162.74 of
this chapter.
[CBP Dec. 05–07, 70 FR 10873, Mar. 7, 2005, as
amended by CBP Dec. 06–39, 71 FR 76134, Dec.
20, 2006]

GOODS RETURNED AFTER REPAIR OR
ALTERATION
§ 10.490 Goods re-entered after repair
or alteration in Chile.
(a) General. This section sets forth
the rules which apply for purposes of
obtaining duty-free treatment on goods
returned after repair or alteration in
Chile as provided for in subheadings
9802.00.40 and 9802.00.50, HTSUS. Goods
returned after having been repaired or
altered in Chile, whether or not pursuant to a warranty, are eligible for
duty-free treatment, provided that the
requirements of this section are met.
For purposes of this section, ‘‘repairs or
alterations’’ means restoration, addition, renovation, re-dyeing, cleaning,
re-sterilizing, or other treatment
which does not destroy the essential
characteristics of, or create a new or
commercially different good from, the
good exported from the United States.
(b) Goods not eligible for treatment. The
duty-free treatment referred to in
paragraph (a) of this section will not
apply to goods which, in their condition as exported from the United
States to Chile, are incomplete for
their intended use and for which the
processing operation performed in
Chile constitutes an operation that is
performed as a matter of course in the
preparation or manufacture of finished
goods.
(c) Documentation. The provisions of
§ 10.8(a), (b), and (c) of this part, relating to the documentary requirements
for goods entered under subheading
9802.00.40 or 9802.00.50, HTSUS, will
apply in connection with the entry of
goods which are returned from Chile
after having been exported for repairs
or alterations and which are claimed to
be duty free.

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§ 10.501

19 CFR Ch. I (4–1–11 Edition)

Subpart I—United StatesSingapore Free Trade Agreement
SOURCE: CBP Dec. 07–28, 72 FR 31995, June
11, 2007, unless otherwise noted.

GENERAL PROVISIONS
§ 10.501 Scope.
This subpart implements the duty
preference and related customs provisions applicable to imported goods
under the United States-Singapore
Free Trade Agreement (the SFTA)
signed on May 6, 2003, and under the
United States-Singapore Free Trade
Agreement Implementation Act (the
Act; 117 Stat. 948). Except as otherwise
specified in this subpart, the procedures and other requirements set forth
in this subpart are in addition to the
customs procedures and requirements
of general application contained elsewhere in this chapter. Additional provisions implementing certain aspects
of the SFTA and the Act are contained
in parts 24, 162, and 163 of this chapter.
§ 10.502 General definitions.
As used in this subpart, the following
terms will have the meanings indicated
unless either the context in which they
are used requires a different meaning
or a different definition is prescribed
for a particular section of this subpart:
(a) Claim for preferential tariff treatment. ‘‘Claim for preferential tariff
treatment’’ means a claim that a good
is entitled to the duty rate applicable
under the SFTA to an originating good
or other good specified in the SFTA,
and to an exemption from the merchandise processing fee;
(b) Customs duty. ‘‘Customs duty’’ includes any customs or import duty and
a charge of any kind imposed in connection with the importation of a good,
including any form of surtax or surcharge in connection with such importation, but, for purposes of implementing the SFTA, does not include
any:
(1) Charge equivalent to an internal
tax imposed consistently with Article
III:2 of GATT 1994 in respect of the like
domestic good or in respect of goods
from which the imported good has been
manufactured or produced in whole or
in part;

(2) Antidumping or countervailing
duty that is applied pursuant to a Party’s domestic law;
(3) Fee or other charge in connection
with importation commensurate with
the cost of services rendered; or
(4) Duty imposed pursuant to Article
5 of the WTO Agreement on Agriculture.
(c) Customs Valuation Agreement.
‘‘Customs Valuation Agreement’’ means
the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994, which is part of the
WTO Agreement;
(d) Days. ‘‘Days’’ means calendar days;
(e) Enterprise. ‘‘Enterprise’’ means an
entity constituted or organized under
applicable law, whether or not for profit, and whether privately-owned or governmentally-owned, including any corporation, trust, partnership, sole proprietorship, joint venture, or other association;
(f) GATT 1994. ‘‘GATT 1994’’ means the
General Agreement on Tariffs and Trade
1994, which is part of the WTO Agreement;
(g) Harmonized System. ‘‘Harmonized
System (HS)’’ means the Harmonized
Commodity Description and Coding System, including its General Rules of Interpretation, Section Notes, and Chapter Notes, as adopted and implemented
by the Parties in their respective tariff
laws;
(h) Heading. ‘‘Heading’’ means the
first four digits in the tariff classification number under the Harmonized
System;
(i) HTSUS. ‘‘HTSUS’’ means the Harmonized Tariff Schedule of the United
States as promulgated by the U.S.
International Trade Commission;
(j) Indirect material. ‘‘Indirect material’’ means a good used in the production, testing, or inspection of a good in
the territory of the United States or
Singapore but not physically incorporated into the good, or a good used in
the maintenance of buildings or the operation of equipment associated with
the production of a good in the territory of the United States or Singapore,
including:
(1) Fuel and energy;
(2) Tools, dies, and molds;

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U.S. Customs and Border Protection, DHS; Treasury
(3) Spare parts and materials used in
the maintenance of equipment and
buildings;
(4) Lubricants, greases, compounding
materials, and other materials used in
production or used to operate equipment and buildings;
(5) Gloves, glasses, footwear, clothing, safety equipment, and supplies;
(6) Equipment, devices, and supplies
used for testing or inspecting the good;
(7) Catalysts and solvents; and
(8) Any other goods that are not incorporated into the good but whose use
in the production of the good can reasonably be demonstrated to be a part of
that production;
(k) Originating. ‘‘Originating’’ means
qualifying for preferential tariff treatment under the rules of origin set out
in SFTA Chapter Three (Rules of Origin) and General Note 25, HTSUS;
(l) Party. ‘‘Party’’ means the United
States or the Republic of Singapore;
(m) Person. ‘‘Person’’ means a natural
person or an enterprise;
(n) Preferential tariff treatment. ‘‘Preferential tariff treatment’’ means the
duty rate applicable under the SFTA to
an originating good, and an exemption
from the merchandise processing fee;
(o) Subheading. ‘‘Subheading’’ means
the first six digits in the tariff classification number under the Harmonized
System;
(p) Tariff preference level. ‘‘Tariff preference level’’ means a quantitative
limit for certain non-originating textiles and textile apparel goods that
may be entitled to preferential tariff
treatment based on the goods meeting
the production requirements set forth
in § 10.521 of this subpart;
(q) Textile or apparel good. ‘‘Textile or
apparel good’’ means a good listed in
the Annex to the Agreement on Textiles and Clothing (commonly referred
to as ‘‘the ATC’’), which is part of the
WTO Agreement;
(r) Territory. ‘‘Territory’’ means:
(1) With respect to Singapore, its
land territory, internal waters and territorial sea as well as the maritime
zones beyond the territorial sea, including the seabed and subsoil over
which the Republic of Singapore exercises sovereign rights or jurisdiction
under its national laws and international law for the purpose of explo-

§ 10.510

ration and exploitation of the natural
resources of such areas; and
(2) With respect to the United States;
(i) The customs territory of the
United States, which includes the 50
states, the District of Columbia, and
Puerto Rico;
(ii) The foreign trade zones located in
the United States and Puerto Rico; and
(iii) Any areas beyond the territorial
seas of the United States within which,
in accordance with international law
and its domestic law, the United States
may exercise rights with respect to the
seabed and subsoil and their natural resources; and
(s) WTO Agreement. ‘‘WTO Agreement’’
means the Marrakesh Agreement Establishing the World Trade Organization of
April 15, 1994.
IMPORT REQUIREMENTS
§ 10.510 Filing of claim for preferential
tariff treatment upon importation.
(a) Claim. An importer may make a
claim for SFTA preferential tariff
treatment, including an exemption
from the merchandise processing fee,
based on the importer’s knowledge or
information in the importer’s possession that the good qualifies as an originating good. For goods that qualify as
originating goods under the Integrated
Sourcing Initiative (see subdivisions
(b)(ii) and (m) of General Note 25,
HTSUS, and § 10.532 of this subpart),
the claim is made by including on the
entry summary, or equivalent documentation, the tariff item 9999.00.84,
HTSUS, or by the method specified for
equivalent reporting via an authorized
electronic data interchange system.
For all other qualifying goods, the
claim is made by including on the
entry summary, or equivalent documentation, the letters ‘‘SG’’ as a prefix
to the subheading of the HTSUS under
which each qualifying good is classified, or by the method specified for
equivalent reporting via an authorized
electronic data interchange system.
(b) Corrected claim. If, after making
the claim required under paragraph (a)
of this section, the importer becomes
aware that the claim is invalid, the importer must promptly correct the
claim and pay any duties that may be

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§ 10.511

19 CFR Ch. I (4–1–11 Edition)

due. The importer must submit a statement either in writing or via an authorized electronic data interchange
system to the CBP office where the
original claim was filed specifying the
correction (see §§ 10.561 and 10.562 of this
subpart).
§ 10.511 Supporting statement.
(a) Contents. An importer who makes
a claim under § 10.510(a) of this subpart
must submit, at the request of the port
director, a statement setting forth the
reasons that the good qualifies as an
originating good, including pertinent
cost and manufacturing data. A statement submitted to CBP under this
paragraph:
(1) Need not be in a prescribed format
but must be in writing or must be
transmitted electronically pursuant to
any electronic means authorized by
CBP for that purpose;
(2) Must include the following information:
(i) The legal name, address, telephone, and e-mail address (if any) of
the importer of record of the good;
(ii) The legal name, address, telephone, and e-mail address (if any) of
the responsible official or authorized
agent of the importer signing the supporting statement (if different from
the information required by paragraph
(a)(2)(i) of this section);
(iii) The legal name, address, telephone, and e-mail address (if any) of
the exporter of the good (if different
from the producer);
(iv) The legal name, address, telephone, and e-mail address (if any) of
the producer of the good (if known);
(v) A description of the good for
which preferential tariff treatment is
claimed, which must be sufficiently detailed to relate it to the invoice and
the HS nomenclature;
(vi) The HTSUS tariff classification,
to six or more digits, as necessary for
the specific change in tariff classification rule for the good set forth in General Note 25(o), HTSUS;
(vii) The applicable rule of origin set
forth in General Note 25, HTSUS, under
which the good qualifies as an originating good; and
(3) Must include a statement, in substantially the following form:
I certify that:

The information on this document is true
and accurate and I assume the responsibility
for proving such representations. I understand that I am liable for any false statements or material omissions made on or in
connection with this document;
I agree to maintain and present upon request, documentation necessary to support
these representations;
The goods originated or are considered to
have originated in the territory of one or
more of the Parties, and comply with the origin requirements specified for those goods
in the United States-Singapore Free Trade
Agreement; there has been no further production or any other operation outside the
territories of the parties, other than unloading, reloading, or any other operation necessary to preserve the goods in good condition or to transport the goods to the United
States; and
This document consists of lll pages, including all attachments.’’

(b) Responsible official or agent. The
supporting statement required to be
submitted under paragraph (a) of this
section must be signed and dated by a
responsible official of the importer or
by the importer’s authorized agent
having knowledge of the relevant facts.
(c) Language. The supporting statement required to be submitted under
paragraph (a) of this section must be
completed in the English language.
(d) Applicability of supporting statement. The supporting statement required to be submitted under paragraph (a) of this section may be applicable to:
(1) A single importation of a good
into the United States, including a single shipment that results in the filing
of one or more entries and a series of
shipments that results in the filing of
one entry; or
(2) Multiple importations of identical
goods into the United States that
occur within a specified blanket period,
not exceeding 12 months, set out in the
statement. For purposes of this paragraph, ‘‘identical goods’’ means goods
that are the same in all respects relevant to the particular rule of origin
that qualifies the goods as originating.
§ 10.512

Importer obligations.

(a) General. An importer who makes a
claim under § 10.510(a) of this subpart is
responsible for the truthfulness of the
claim and of all the information and

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U.S. Customs and Border Protection, DHS; Treasury
data contained in the supporting statement provided for in § 10.511 of this subpart, for submitting any supporting
documents requested by CBP, and for
the truthfulness of the information
contained in those documents. However, an importer will not be subject to
civil or administrative penalties under
19 U.S.C. 1592 for making an invalid
claim for preferential tariff treatment
or submitting an incorrect supporting
statement, provided that the importer
promptly and voluntarily corrects the
claim or supporting statement and
pays any duty owing (see §§ 10.561 and
10.562 of this subpart). In instances in
which CBP requests the submission of
supporting documents, CBP will allow
for the direct submission by the exporter or producer of business confidential or other sensitive information, including cost and sourcing information.
(b) Compliance. In order to make a
claim for preferential tariff treatment
under § 10.510(a) of this subpart, the importer:
(1) Must have records that explain
how the importer came to the conclusion that the good qualifies for preferential
tariff
treatment.
Those
records must include documents that
support a claim that the article in
question qualifies for preferential tariff
treatment because it meets the applicable rules of origin set forth in General Note 25, HTSUS, and in this subpart. Those records may include a
properly completed importer’s supporting statement as set forth in
§ 10.511 of this subpart; and
(2) May be required to present evidence that the conditions set forth in
§ 10.542 of this subpart were met if the
imported article was shipped through
an intermediate country.
(c) Information provided by exporter or
producer. The fact that the importer
has made a claim or supporting statement based on information provided by
an exporter or producer will not relieve
the importer of the responsibility referred to in the first sentence of paragraph (a) of this section.
§ 10.513 Supporting statement not required.
(a) General. Except as otherwise provided in paragraph (b) of this section,
an importer will not be required to sub-

§ 10.514

mit a supporting statement under
§ 10.511 of this subpart for:
(1) A non-commercial importation of
a good; or
(2) A commercial importation for
which the value of the goods does not
exceed U.S. $2,500.
(b) Exception. If the port director determines that an importation described
in paragraph (a) of this section may
reasonably be considered to have been
carried out or planned for the purpose
of evading compliance with the rules
and procedures governing claims for
preference under the SFTA, the port
director will notify the importer that
for that importation the importer must
submit to CBP a supporting statement.
The importer must submit such a
statement within 30 days from the date
of the notice. Failure to timely submit
the supporting statement will result in
denial of the claim for preferential
treatment.
§ 10.514

Maintenance of records.

(a) General. An importer claiming
preferential tariff treatment for a good
imported into the United States under
§ 10.510(a) of this subpart must maintain, for five years after the date of importation of the good, any records and
documents that the importer has relating to the origin of the good, including
records and documents associated with:
(1) The purchase of, cost of, value of,
and payment for, the good;
(2) Where appropriate, the purchase
of, cost of, value of, and payment for,
all materials, including recovered
goods and indirect materials, used in
the production of the good; and
(3) Where appropriate, the production
of the good in the form in which the
good was exported.
(b) Applicability of other recordkeeping
requirements. The records and documents referred to in paragraph (a) of
this section are in addition to any
other records that the importer is required to prepare, maintain, or make
available to CBP under part 163 of this
chapter.
(c) Method of maintenance. The
records and documents referred to in
paragraph (a) of this section must be
maintained by importers as provided in
§ 163.5 of this chapter.

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§ 10.515

19 CFR Ch. I (4–1–11 Edition)

§ 10.515 Effect of noncompliance; failure to provide documentation regarding third country transportation.
(a) Effect of noncompliance. If the importer fails to comply with any requirement under this subpart, including submission of a complete supporting statement under § 10.511 of this
subpart, when requested, the port director may deny preferential treatment to the imported good.
(b) Failure to provide documentation regarding third country transportation.
Where the requirements for preferential treatment set forth elsewhere
in this subpart are met, the port director nevertheless may deny preferential
treatment to an originating good if the
good is shipped through or transshipped in a country other than Singapore or the United States, and the importer of the good does not provide, at
the request of the port director, evidence demonstrating to the satisfaction of the port director that the conditions set forth in § 10.542 of this subpart
were met.

§ 10.521 Goods eligible for tariff preference level claims.
Goods eligible for a TPL claim consist of cotton or man-made fiber apparel goods provided for in Chapters 61
and 62 of the HTSUS that are both cut
(or knit-to-shape) and sewn or otherwise assembled in Singapore from fabric or yarn produced or obtained outside the territory of Singapore or the
United States, and that meet the applicable conditions for preferential tariff
treatment under the SFTA, other than
the condition that they are originating
goods. The preferential tariff treatment is limited to the quantities specified in U.S. Note 13, Subchapter X,
Chapter 99, HTSUS.
§ 10.522 Submission of certificate of
eligibility.
An importer who claims preferential
tariff treatment on a non-originating
cotton or man-made fiber apparel good
must submit a certificate of eligibility
issued by the Government of Singapore, demonstrating that the good is
eligible for entry under the applicable
TPL, as set forth in § 10.521 of this subpart.

TARIFF PREFERENCE LEVEL

RULES OF ORIGIN

§ 10.520 Filing of claim for tariff preference level.
A cotton or man-made fiber apparel
good described in § 10.521 of this subpart
that does not qualify as an originating
good under § 10.531 of this subpart may
nevertheless be entitled to preferential
tariff treatment under the SFTA under
an applicable tariff preference level
(TPL). To make a TPL claim, the importer must include on the entry summary, or equivalent documentation,
the applicable tariff item in Chapter 99
of the HTSUS (9910.61.01 through
9910.61.89) and the applicable subheading in Chapter 61 or 62 of the
HTSUS under which each non-originating cotton or man-made fiber apparel good is classified. For TPL goods,
the letters ‘‘SG’’ must be inserted as a
prefix to the applicable HTSUS 9910
tariff item when the entry is filed. The
importer must also submit a certificate of eligibility as set forth in § 10.522
of this subpart.

§ 10.530 Definitions.
For purposes of §§ 10.530 through
10.542:
(a) Adjusted value. ‘‘Adjusted value’’
means the value determined in accordance with Articles 1 through 8, Article
15, and the corresponding interpretative notes of the Customs Valuation
Agreement, adjusted, if necessary, to
exclude:
(1) Any costs, charges, or expenses incurred for transportation, insurance
and related services incident to the
international shipment of the merchandise from the country of exportation to the place of importation; and
(2) The value of packing materials
and containers for shipment as defined
in paragraph (j) of this section;
(b) Exporter. ‘‘Exporter’’ means a person who exports goods from the territory of a Party;
(c) Fungible goods or materials. ‘‘Fungible goods or materials’’ means goods
or materials, as the case may be, that
are interchangeable for commercial

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U.S. Customs and Border Protection, DHS; Treasury
purposes and the properties of which
are essentially identical;
(d) Generally Accepted Accounting
Principles. ‘‘Generally Accepted Accounting principles’’ means the recognized consensus or substantial authoritative support in the territory of a
Party, with respect to the recording of
revenues, expenses, costs, assets, and
liabilities, the disclosure of information, and the preparation of financial
statements. These standards may encompass broad guidelines of general application as well as detailed standards,
practices, and procedures;
(e) Good. ‘‘Good’’ means any merchandise, product, article, or material;
(f) Goods wholly obtained or produced
entirely in the territory of one or both of
the Parties. ‘‘Goods wholly obtained or
produced entirely in the territory of
one or both of the Parties’’ means:
(1) Mineral goods extracted in the
territory of one or both of the Parties;
(2) Vegetable goods, as such goods are
defined in the Harmonized System,
harvested in the territory of one or
both of the Parties;
(3) Live animals born and raised in
the territory of one or both of the Parties;
(4) Goods obtained from hunting,
trapping, fishing, or aquaculture conducted in the territory of one or both
of the Parties;
(5) Goods (fish, shellfish and other
marine life) taken from the sea by vessels registered or recorded with a Party
and flying its flag;
(6) Goods produced exclusively from
products referred to in subparagraph
(f)(5) of this section on board factory
ships registered or recorded with a
Party and flying its flag;
(7) Goods taken by a Party or a person of a Party from the seabed or beneath the seabed outside territorial
waters, provided that a Party has
rights to exploit such seabed;
(8) Goods taken from outer space,
provided they are obtained by a Party
or a person of a Party and not processed in the territory of a non-Party;
(9) Waste and scrap derived from:
(i) Production in the territory of one
or both of the Parties; or
(ii) Used goods collected in the territory of one or both of the Parties, pro-

§ 10.530

vided such goods are fit only for the recovery of raw materials;
(10) Recovered goods derived in the
territory of one or both of the Parties
from used goods; or
(11) Goods produced in one or both of
the Parties exclusively from goods referred to in paragraphs (f)(1) through
(f)(9) of this section or from the derivatives of such goods;
(g) Material. ‘‘Material’’ means a good
that is used in the production of another good;
(h) Non-originating good. ‘‘Non-originating good’’ means a good that does
not qualify as originating under General Note 25, HTSUS;
(i) Non-originating material. ‘‘Non-originating material’’ means a material
that does not qualify as originating
under General Note 25, HTSUS;
(j) Packing materials and containers for
shipment. ‘‘Packing materials and containers for shipment’’ means the goods
used to protect a good during its transportation to the United States, and
does not include the packaging materials and containers in which a good is
packaged for retail sale;
(k) Producer. ‘‘Producer’’ means a person who grows, raises, mines, harvests,
fishes, traps, hunts, manufactures,
processes, assembles or disassembles a
good;
(l) Production. ‘‘Production’’ means
growing, mining, harvesting, fishing,
raising, trapping, hunting, manufacturing, processing, assembling, or disassembling a good;
(m) Recovered goods. ‘‘Recovered
goods’’ means materials in the form of
individual parts that are the result of:
(1) The complete disassembly of used
goods into individual parts; and
(2) The cleaning, inspecting, testing,
or other processing of those parts as
necessary for improvement to sound
working condition by one or more of
the following processes: Welding, flame
spraying, surface machining, knurling,
plating, sleeving, and rewinding, in
order for such parts to be assembled
with other parts, including other recovered parts, in the production of a
remanufactured good as defined in
paragraph (o) of this section;

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§ 10.531

19 CFR Ch. I (4–1–11 Edition)

(n) Relationship. ‘‘Relationship’’ means
whether the buyer and seller are related parties in accordance with Article 15.4 of the Customs Valuation
Agreement;
(o) Remanufactured good. ‘‘Remanufactured good’’ means an industrial
good assembled in the territory of
Singapore or the United States that is
enumerated in Annex 3C, SFTA, and:
(1) Is entirely or partially comprised
of recovered goods;
(2) Has the same life expectancy and
meets the same performance standards
as a new good; and
(3) Enjoys the same factory warranty
as such a new good;
(p) Self-produced material. ‘‘Self-produced material’’ means a good, such as
a part or ingredient, produced by the
producer and used by the producer in
the production of another good; and
(q) Value. ‘‘Value’’ means the value of
a good or material for purposes of calculating customs duties or for purposes
of applying this subpart.
§ 10.531

Originating goods.

Except as provided in § 10.543 of this
subpart, a good imported into the customs territory of the United States
will be considered an originating good
under the SFTA only if:
(a) The good is wholly obtained or
produced entirely in the territory of
one or both of the Parties;
(b) The good is transformed in one or
both of the Parties so that:
(1) Each non-originating material undergoes an applicable change in tariff
classification specified in General Note
25(o), HTSUS, as a result of production
occurring entirely in the territory of
one or both of the Parties; and
(2) The good otherwise satisfies any
applicable regional value content or
other requirements specified in General Note 25(o), HTSUS; or
(c) The good, in its condition as imported into the United States, is enumerated as an Integrated Sourcing Initiative good in General Note 25(m),
HTSUS, and is imported from the territory of Singapore.
§ 10.532

Integrated Sourcing Initiative.

(a) For purposes of General Note
25(b)(ii), HTSUS, a good is eligible for

treatment as an originating good under
the Integrated Sourcing Initiative if:
(1) The good, in its condition as imported, is both classified in a tariff provision enumerated in the first column
of General Note 25(m), HTSUS, and described opposite that tariff provision in
the list of information technology articles set forth in the second column of
General Note 25(m), HTSUS;
(2) The good, regardless of its origin,
is imported into the territory of the
United States from the territory of
Singapore. If a product of a non-Party,
the good must have been imported into
Singapore prior to its importation into
the territory of the United States; and
(3) The good satisfies the conditions
and requirements of § 10.542 relating to
third country transportation.
(b) A good enumerated in General
Note 25(m), HTSUS, that is used in the
production of another good in Singapore will not be considered an originating material for purposes of determining the eligibility for preferential
tariff treatment of such other good unless:
(1) The good enumerated in General
Note 25(m), HTSUS, satisfies an applicable rule of origin set out in General
Note 25(o), HTSUS; or
(2) The good enumerated in General
Note 25(m), HTSUS, is imported into
the territory of Singapore from the territory of the United States prior to
being used in the production of a good
in Singapore.
§ 10.533 De minimis.
(a) Except as provided in paragraphs
(b) and (c) of this section, a good that
does not undergo a change in tariff
classification pursuant to General Note
25(o), HTSUS, will nonetheless be considered to be an originating good if:
(1) The value of all non-originating
materials used in the production of the
good that do not undergo the applicable change in tariff classification does
not exceed 10 percent of the adjusted
value of the good;
(2) The value of the non-originating
materials described in paragraph (a)(1)
of this section is included in calculating the value of non-originating materials for any applicable regional
value content requirement for the good
under General Note 25(o), HTSUS; and

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U.S. Customs and Border Protection, DHS; Treasury
(3) The good meets all other applicable requirements of General Note 25,
HTSUS.
(b) Paragraph (a) does not apply to:
(1) A non-originating material provided for in Chapter 4, HTSUS, or in
subheading 1901.90, HTSUS, that is used
in the production of a good provided for
in Chapter 4, HTSUS;
(2) A non-originating material provided for in Chapter 4, HTSUS, or in
subheading 1901.90, HTSUS, that is used
in the production of a good provided for
in one of the following HTSUS provisions: Subheading 1901.10, 1901.20 or
1901.90; heading 2105; or subheading
2106.90, 2202.90 or 2309.90;
(3) A non-originating material provided for in heading 0805, HTSUS, or
subheadings 2009.11 through 2009.39,
HTSUS, that is used in the production
of a good provided for in subheadings
2009.11 through 2009.39, HTSUS, or in
subheading 2106.90 or 2202.90, HTSUS;
(4) A non-originating material provided for in Chapter 15, HTSUS, that is
used in the production of a good provided for in headings 1501 through 1508,
1512, 1514 or 1515, HTSUS;
(5) A non-originating material provided for in heading 1701, HTSUS, that
is used in the production of a good provided for in headings 1701 through 1703,
HTSUS;
(6) A non-originating material provided for in Chapter 17, HTSUS, or
heading 1805, HTSUS, that is used in
the production of a good provided for in
subheading 1806.10, HTSUS;
(7) A non-originating material provided for in headings 2203 through 2208,
HTSUS, that is used in the production
of a good provided for in heading 2207
or 2208, HTSUS; and
(8) A non-originating material used
in the production of a good provided for
in Chapters 1 through 21, HTSUS, unless the non-originating material is
provided for in a different subheading
than the good for which origin is being
determined.
(c) A textile or apparel good provided
for in Chapters 50 through 63, HTSUS,
that is not an originating good because
certain fibers or yarns used in the production of the component of the good
that determines the tariff classification of the good do not undergo an applicable change in tariff classification

§ 10.535

set out in General Note 25(o), HTSUS,
will nevertheless be considered to be an
originating good if the total weight of
all such fibers or yarns in that component is not more than 7 percent of the
total weight of that component. Notwithstanding the preceding sentence, a
textile or apparel good containing elastomeric yarns in the component of the
good that determines the tariff classification of the good will be considered
an originating good only if such yarns
are wholly formed in the territory of a
Party.
§ 10.534 Accumulation.
(a) Originating materials of Singapore or the United States that are used
in the production of a good in the territory of the other party will be considered to originate in the territory of the
other party.
(b) A good that is produced in the
territory of one or both of the Parties
by one or more producers, will be considered an originating good if the good
satisfies:
(1) The applicable requirements of
§ 10.531 of this subpart and General
Note 25, HTSUS; or
(2) The provisions of § 10.532 of this
subpart.
§ 10.535 Regional value content.
(a) General. Where General Note 25(o),
HTSUS, sets forth a rule that specifies
a regional value content test for a
good, the regional value content of
such good must be calculated, at the
choice of the person claiming the preferential tariff treatment for such good,
on the basis of the build-down method
or the build-up method described in
paragraphs (b) and (c) of this section,
unless otherwise specified in General
Note 25(o), HTSUS.
(b) Build-down method. Under the
build-down method, the regional value
content must be calculated on the
basis of the formula RVC = ((AV
¥VNM)/AV) × 100, where RVC is the regional value content, expressed as a
percentage; AV is the adjusted value;
and VNM is the value of non-originating materials that are acquired and
used by the producer in the production
of the good.
(c) Build-up method. Under the buildup method, the regional value content

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§ 10.536

19 CFR Ch. I (4–1–11 Edition)

must be calculated on the basis of the
formula RVC = (VOM /AV) × 100, where
RVC is the regional value content, expressed as a percentage; AV is the adjusted value; and VOM is the value of
originating materials that are acquired
or self-produced and used by the producer in the production of the good.
§ 10.536 Value of materials.
(a) Calculating the value of materials.
Except as provided in § 10.541, for purposes of calculating the regional value
content of a good under General Note
25(o), HTSUS, and for purposes of applying the de minimis (see § 10.533 of this
subpart) provisions of General Note
25(o), HTSUS, the value of a material
is:
(1) In the case of a material imported
by the producer of the good, the adjusted value of the material;
(2) In the case of a material acquired
by the producer in the territory where
the good is produced, except for a material to which paragraph (a)(3) of this
section applies, the adjusted value of
the material with reasonable modifications to the provisions of the Customs
Valuation Agreement so as to permit
their application to the domestic acquisition by the producer. Such reasonable modifications include, but are not
limited to, treating a domestic purchase by the producer as if it were a
sale for export to the country of importation; or
Example 1. The producer in Singapore purchases material x from an unrelated seller in
Singapore for $100. Under the provisions of
Article 1 of the Customs Valuation Agreement, transaction value is the price actually
paid or payable for the goods when sold for
export to the country of importation adjusted in accordance with the provisions of
Article 8. In order to apply Article 1 to this
domestic purchase by the producer, such purchase is treated as if it were a sale for export
to the country of importation. Therefore, for
purposes of determining the adjusted value
of material x, Article 1 transaction value is
the price actually paid or payable for the
goods when sold to the producer in Singapore
($100), adjusted in accordance with the provisions of Article 8. In this example, it is irrelevant whether material x was initially imported into Singapore by the seller (or by
anyone else). So long as the producer acquired material x in Singapore, it is intended
that the value of material x will be determined on the basis of the price actually paid

or payable by the producer adjusted in accordance with the provisions of Article 8.
Example 2. Same facts as in Example 1, except the sale between the seller and the producer is subject to certain restrictions that
preclude the application of Article 1. Under
Article 2 of the Customs Valuation Agreement, the value is the transaction value of
identical goods sold for export to the same
country of importation and exported at or
about the same time as the goods being valued. In order to permit the application of Article 2 to the domestic acquisition by the
producer, it should be modified so that the
value is the transaction value of identical
goods sold within Singapore at or about the
same time the goods were sold to the producer in Singapore. Thus, if the seller of material x also sold an identical material to another buyer in Singapore without restrictions, that other sale would be used to determine the adjusted value of material x.

(3) In the case of a self-produced material, or in a case in which the relationship between the producer of the
good and the seller of the material influenced the price actually paid or payable for the material, including a material obtained without charge, the
sum of:
(i) All expenses incurred in the production of the material, including general expenses; and
(ii) A reasonable amount for profit.
(b) Permissible additions to, and deductions from, the value of materials—(1) Additions to originating materials. For originating materials, the following expenses, if not included under paragraph
(a) of this section, may be added to the
value of the originating material:
(i) The costs of freight, insurance,
packing, and all other costs incurred in
transporting the material to the location of the producer;
(ii) Duties, taxes, and customs brokerage fees on the material paid in the
territory of one or both of the Parties,
other than duties and taxes that are
waived, refunded, refundable or otherwise recoverable, including credit
against duty or tax paid or payable;
and
(iii) The cost of waste and spoilage
resulting from the use of the material
in the production of the good, less the
value of renewable scrap or by-product;
and
(2) Deductions from non-originating materials. For non-originating materials,
if included under paragraph (a) of this

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U.S. Customs and Border Protection, DHS; Treasury
section, the following expenses may be
deducted from the value of the nonoriginating material:
(i) The costs of freight, insurance,
packing, and all other costs incurred in
transporting the material to the location of the producer;
(ii) Duties, taxes, and customs brokerage fees on the material paid in one
or both of the Parties, other than duties and taxes that are waived, refunded, refundable or otherwise recoverable, including credit against duty or
tax paid or payable;
(iii) The cost of waste and spoilage
resulting from the use of the material
in the production of the good, less the
value of renewable scrap or by-products;
(iv) The cost of processing incurred
in the territory of Singapore or the
United States in the production of the
non-originating material; and
(v) The cost of originating materials
used in the production of the non-originating material in the territory of
Singapore or the United States.
(c) Accounting method. Any cost or
value referenced in General Note 25,
HTSUS and this subpart, must be recorded and maintained in accordance
with the Generally Accepted Accounting Principles applicable in the territory of the country in which the good
is produced (whether Singapore or the
United States).
§ 10.537 Accessories, spare parts, or
tools.
Accessories, spare parts, or tools that
are delivered with a good and that form
part of the good’s standard accessories,
spare parts, or tools will be treated as
originating goods if the good is an originating good, and will be disregarded in
determining whether all the non-originating materials used in the production of the good undergo an applicable
change in tariff classification specified
in General Note 25(o), HTSUS, provided
that:
(a) The accessories, spare parts, or
tools are not invoiced separately from
the good;
(b) The quantities and value of the
accessories, spare parts, or tools are
customary for the good; and
(c) If the good is subject to a regional
value content requirement, the value

§ 10.539

of the accessories, spare parts, or tools
will be taken into account as originating or non-originating materials, as
the case may be, in calculating the regional value content of the good under
§ 10.535 of this subpart.
§ 10.538

Fungible goods and materials.

(a) A person claiming preferential
treatment under the SFTA for a good
may claim that a fungible good or material is originating either based on the
physical segregation of each fungible
good or material or by using an inventory management method. For purposes of this subpart, the term ‘‘inventory management method’’ means:
(1) Averaging;
(2) ‘‘Last-in, first-out;’’
(3) ‘‘First-in, first-out;’’ or
(4) Any other method that is recognized in the Generally Accepted Accounting Principles of the Party in
which the production is performed or
otherwise accepted by that country.
(b) A person selecting an inventory
management method under paragraph
(a) of this section for particular fungible goods or materials must continue
to use that method for those fungible
goods or materials throughout the fiscal year of that person.
§ 10.539 Retail packaging
and containers.

materials

Packaging materials and containers
in which a good is packaged for retail
sale, if classified with the good for
which preferential treatment under the
SFTA is claimed, will be disregarded in
determining whether all non-originating materials used in the production of the good undergo the applicable
change in tariff classification set out
in General Note 25(o), HTSUS. If the
good is subject to a regional value content requirement, the value of such
packaging materials and containers
will be taken into account as originating or non-originating materials, as
the case may be, in calculating the regional value content of the good.
Example 1. Singaporean Producer A of good
C imports 100 non-originating blister packages to be used as retail packaging for good
C. As provided in § 10.536(a)(1) of this subpart,
the value of the blister packages is their adjusted value, which in this case is $10. Good
C has a regional value content requirement.

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§ 10.540

19 CFR Ch. I (4–1–11 Edition)

The United States importer of good C decides
to
use
the
build-down
method,
RVC=((AV¥VNM)/AV) × 100 (see § 10.535(b) of
this subpart), in determining whether good C
satisfies the regional value content requirement. In applying this method, the non-originating blister packages are taken into account as non-originating. As such, their $10
adjusted value is included in the VNM, value
of non-originating materials, of good C.
Example 2. Same facts as in Example 1, but
the blister packages are originating. In this
case, the adjusted value of the originating
blister packages would not be included as
part of the VNM of good C under the builddown method. However, if the U.S. importer
had used the build-up method, RVC=(VOM/
AV) × 100 (see § 10.535(c) of this subpart), the
adjusted value of the blister packaging
would be included as part of the VOM, value
of originating material.

§ 10.540 Packing materials and containers for shipment.
(a) Packing materials and containers
for shipment, as defined in § 10.530(j) of
this subpart, are to be disregarded in
determining whether the non-originating materials used in the production of the good undergo an applicable
change in tariff classification set out
in General Note 25(o), HTSUS. Accordingly, such materials and containers
are not required to undergo the applicable change in tariff classification
even if they are non-originating.
(b) Packing materials and containers
for shipment, as defined in § 10.530(j) of
this subpart, are to be disregarded in
determining the regional value content
of a good imported into the United
States. Accordingly, in applying either
the build-down or build-up method for
determining the regional value content
of the good imported into the United
States, the value of such packing materials and containers for shipment
(whether originating or non-originating) is disregarded and not included
in AV, adjusted value, VNM, value of
non-originating materials, or VOM,
value of originating materials.
Example. Singaporean Producer A produces
good C. Producer A ships good C to the U.S.
in a shipping container which it purchased
from Company B in Singapore. The shipping
container is originating. The value of the
shipping container determined under section
§ 10.536(a)(2) of this subpart is $3. Good C is
subject to a regional value content requirement. The transaction value of good C is
$100, which includes the $3 shipping con-

tainer. The United States importer decides
to use the build-up method, RVC=(VOM/AV)
× 100 (see § 10.535(c) of this subpart), in determining whether good C satisfies the regional
value content requirement. In determining
the AV, adjusted value, of good C imported
into the U.S., paragraph (b) of this section
requires a $3 deduction for the value of the
shipping container. Therefore, the AV is $97
($100¥$3). In addition, the value of the shipping container is disregarded and not included in the VOM, value of originating materials.

§ 10.541

Indirect materials.

An indirect material, as defined in
§ 10.502(j) of this subpart, will be considered to be an originating material
without regard to where it is produced,
and its value will be the cost registered
in the accounting records of the producer of the good.
Example. Singaporean Producer C produces
good C using non-originating material A.
Producer C imports non-originating rubber
gloves for use by workers in the production
of good C. Good C is subject to a tariff shift
requirement. As provided in § 10.531(b)(1) of
this subpart and General Note 25(o), each of
the non-originating materials in good C
must undergo the specified change in tariff
classification in order for good C to be considered originating. Although non-originating material A must undergo the applicable tariff shift in order for good C to be considered originating, the rubber gloves do not
because they are indirect materials and are
considered originating without regard to
where they are produced.

§ 10.542

Third country transportation.

(a) General. A good will not be considered an originating good by reason of
having undergone production that
would enable the good to qualify as an
originating good if subsequent to that
production the good undergoes further
production or any other operation outside the territories of the Parties,
other than unloading, reloading, or any
other process necessary to preserve the
good in good condition or to transport
the good to the territory of a Party.
(b) Documentary evidence. An importer making a claim that a good is
originating may be required to demonstrate, to CBP’s satisfaction, that no
further production or subsequent operation, other than permitted under
paragraph (a) of this section, occurred
outside the territories of the Parties.

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U.S. Customs and Border Protection, DHS; Treasury
An importer may demonstrate compliance with this section by submitting
documentary evidence. Such evidence
may include, but is not limited to, bills
of lading, airway bills, packing lists,
commercial invoices, receiving and inventory records, and customs entry
and exit documents.
§ 10.543 Certain apparel goods made
from fabric or yarn not available in
commercial quantities.
Notwithstanding the provisions of
§ 10.531 of this subpart, a textile apparel
article of Chapter 61 or 62, HTSUS, will
be considered an originating good
under the SFTA if it is both cut (or
knit to shape) and sewn or otherwise
assembled in one or both of the Parties
from fabric or yarn, regardless of origin, designated by the Committee for
the Implementation of Textile Agreements (‘‘CITA’’) as not available in commercial quantities in a timely manner
in the United States. Such designations by CITA, identifying apparel
goods made from such fabric or yarn as
eligible for entry under subheading
9819.11.24 or 9820.11.27, HTSUS, must
have been made by notices published in
the FEDERAL REGISTER no later than
November 15, 2002. 1 For purposes of
this section, any reference in these notices to fabric or yarn formed in the
United States will be interpreted as
also including fabric or yarn formed in
Singapore.
ORIGIN VERIFICATIONS AND
DETERMINATIONS
§ 10.550 Verification and justification
of claim for preferential treatment.
(a) Verification. A claim for preferential
treatment
made
under
§ 10.510(a) of this subpart, including any
statements or other information submitted to CBP in support of the claim,
will be subject to such verification as
the port director deems necessary. In
the event that the port director is provided with insufficient information to
verify or substantiate the claim, the
1 These designations are set forth in notices published in the FEDERAL REGISTER on
September 25, 2001 (66 FR 49005), November
19, 2001 (66 FR 57942), April 10, 2002 (67 FR
17412), May 28, 2002 (67 FR 36858), and September 5, 2002 (67 FR 56806).

§ 10.551

port director may deny the claim for
preferential treatment. A verification
of a claim for preferential tariff treatment may be conducted by means of
one or more of the following:
(1) Requests for information from the
importer;
(2) Written requests for information
to the exporter or producer;
(3) Requests for the importer to arrange for the exporter or producer to
provide information directly to CBP;
(4) Visits to the premises of the exporter or producer in Singapore, in accordance with procedures that the Parties adopt pertaining to verification;
and
(5) Such other procedures as the Parties may agree.
(b) Applicable accounting principles.
When conducting a verification of origin to which Generally Accepted Accounting Principles may be relevant,
CBP will apply and accept the Generally Accepted Accounting Principles
applicable in the country of production.
§ 10.551 Issuance of negative origin determinations.
If, as a result of an origin
verification initiated under § 10.550 of
this subpart, CBP denies a claim for
preferential treatment made under
§ 10.510(a) of this subpart, it will issue a
determination in writing or via an authorized electronic data interchange
system to the importer that sets forth
the following:
(a) A description of the good that was
the subject of the verification together
with the identifying numbers and dates
of the import documents pertaining to
the good;
(b) A statement setting forth the
findings of fact made in connection
with the verification and upon which
the determination is based; and
(c) With specific reference to the
rules applicable to originating goods as
set forth in General Note 25, HTSUS,
and in §§ 10.530 through 10.543 of this
subpart, the legal basis for the determination.

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§ 10.552

19 CFR Ch. I (4–1–11 Edition)

§ 10.552 Information sharing by CBP
regarding textile and apparel goods
produced in the United States.
(a) Documents or information in the
possession of U.S. enterprises. Upon written request from the Government of
Singapore containing a brief statement
of the matter at issue and the cooperation requested, CBP will promptly request from a U.S. enterprise and provide to the Government of Singapore,
to the extent available, all correspondence, reports, bills of lading, invoices,
order confirmations, and other documents or information relevant to circumvention that the Government of
Singapore considers may have taken
place.
(b) Circumvention defined. For purposes of this section and § 10.554 of this
subpart, ‘‘circumvention’’ means providing a false claim or false information for the purpose of, or with the effect of, violating or evading existing
customs, country of origin labeling, or
trade laws of the Party into which the
textile or apparel goods are imported,
if such action results in the avoidance
of tariffs, quotas, embargoes, prohibitions, restrictions, trade remedies, including antidumping or countervailing
duties, or safeguard measures, or in obtaining preferential tariff treatment.
Examples of circumvention include: Illegal transshipment; rerouting; fraud;
false claims concerning country of origin, fiber content, quantities, description, or classification; falsification of
documents; and smuggling.
§ 10.553 Textile and apparel site visits.
(a) Visits to enterprises of Singapore.
U.S. officials may undertake to conduct site visits to enterprises in the
territory of Singapore. U.S. officials
will conduct such visits together with
responsible officials of the Government
of Singapore and in accordance with
the laws of Singapore.
(b) Denial of permission to visit. If the
responsible officials of an enterprise of
Singapore that is proposed to be visited
do not consent to the site visit, CBP
will, if directed by The Committee for
the Implementation of Textile Agreements (CITA), exclude from the territory of the United States textile or apparel goods produced or exported by
the enterprise until CITA determines

that the enterprise’s production of, and
capability to produce, such goods is
consistent with statements by the enterprise that textile or apparel goods it
produces or has produced are originating goods or products of Singapore.
§ 10.554 Exclusion of textile or apparel
goods for intentional circumvention.
(a) General. If CITA finds that an enterprise of Singapore has knowingly or
willfully engaged in circumvention,
CBP will, if directed by CITA, exclude
from the customs territory of the
United States textile or apparel goods
produced or exported by that enterprise for a period no longer than the
applicable period described in paragraph (b) of this section.
(b) Time periods. An exclusion from
entry imposed under paragraph (a) of
this section will begin on the date a
finding of knowing or willful circumvention is made by CITA and will
remain in effect for the following applicable time period:
(1) With respect to a first finding, the
applicable period is six months;
(2) With respect to a second finding,
the applicable period is two years; or
(3) With respect to a third or subsequent finding, the applicable period is
two years. If, at the time of a third or
subsequent finding, an exclusion of
goods with respect to an enterprise is
in effect as a result of a previous finding, the two-year period applicable to
the third or subsequent finding will
begin on the day after the day on
which the previous exclusion period
terminates.
PENALTIES
§ 10.560

General.

Except as otherwise provided in this
subpart, all criminal, civil or administrative penalties which may be imposed on U.S. importers for violations
of the customs and related laws and
regulations will also apply to U.S. importers for violations of the laws and
regulations relating to the SFTA.

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U.S. Customs and Border Protection, DHS; Treasury
§ 10.561 Corrected claim or supporting
statement.
An importer who makes a corrected
claim under § 10.510(b) will not be subject to civil or administrative penalties
under 19 U.S.C. 1592 for having made an
incorrect claim or supporting statement, provided that the corrected
claim is promptly and voluntarily
made.
§ 10.562 Framework
for
correcting
claims or supporting statements.
(a) ‘‘Promptly and voluntarily’’ defined.
Except as provided for in paragraph (b)
of this section, for purposes of this subpart, the making of a corrected claim
or supporting statement will be deemed
to have been done promptly and voluntarily if:
(1)(i) Done within one year following
the date on which the importer made
the incorrect claim; or
(ii) Done later than one year following the date on which the importer
made the incorrect claim, provided
that the corrected claim is made:
(A) Before the commencement of a
formal investigation, within the meaning of § 162.74(g) of this chapter; or
(B) Before any of the events specified
in § 162.74(i) of this chapter has occurred; or
(C) Within 30 days after the importer
initially becomes aware that the incorrect claim is not valid; and
(2) Accompanied by a statement setting forth the information specified in
paragraph (c) of this section; and
(3) Accompanied or followed by a tender of any actual loss of duties and
merchandise processing fees, if applicable, in accordance with paragraph (e) of
this section.
(b) Exception in cases involving fraud
or subsequent incorrect claims—(1) Fraud.
An importer who acted fraudulently in
making an incorrect claim may not
make a voluntary correction of that
claim. For purposes of this paragraph,
the term ‘‘fraud’’ will have the meaning
set forth in paragraph (C)(3) of appendix B to part 171 of this chapter.
(2) Subsequent incorrect claims. An importer who makes one or more incorrect claims after becoming aware that
a claim involving the same merchandise and circumstances is invalid may
not make a voluntary correction of the

§ 10.562

subsequent claims pursuant to paragraph (a)(1)(ii)(C) of this section.
(c) Statement. For purposes of this
subpart, each corrected claim must be
accompanied by a statement, submitted in writing or via an authorized
electronic data interchange system,
which:
(1) Identifies the class or kind of good
to which the incorrect claim relates;
(2) Identifies each affected import
transaction, including each port of importation and the approximate date of
each importation.
(3) Specifies the nature of the incorrect statements or omissions regarding
the claim; and
(4) Sets forth, to the best of the person’s knowledge, the true and accurate
information or data which should have
been covered by or provided in the
claim, and states that the person will
provide any additional information or
data which is unknown at the time of
making the corrected claim within 30
days or within any extension of that 30day period as CBP may permit in order
for the person to obtain the information or data.
(d) Substantial compliance. For purposes of this section, a person will be
deemed to have submitted the statement described in paragraph (c) of this
section even though that person provided corrected information in a manner which does not conform to the requirements of the statement specified
in paragraph (c) of this section, provided that the information submitted
includes, orally or otherwise, substantially the same information as that
specified in paragraph (c) of this section.
(e) Tender of actual loss of duties. A
U.S. importer who makes a corrected
claim must tender any actual loss of
duties at the time of making the corrected claim, or within 30 days thereafter, or within any extension of that
30-day period as CBP may allow in
order for the importer to obtain the information or data necessary to calculate the duties owed.
(f) Applicability of prior disclosure provisions. Where a person fails to meet
the requirements of this section, that
person may nevertheless qualify for
prior disclosure treatment under 19

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§ 10.570

19 CFR Ch. I (4–1–11 Edition)

U.S.C. 1592(c)(4) and 162.74 of this chapter.

GENERAL PROVISIONS
§ 10.581

GOODS RETURNED AFTER REPAIR OR
ALTERATION
§ 10.570 Goods re-entered after repair
or alteration in Singapore.
(a) General. This section sets forth
the rules which apply for purposes of
obtaining duty-free treatment on goods
returned after repair or alteration in
Singapore as provided for in subheadings
9802.00.40
and
9802.00.50,
HTSUS. Goods returned after having
been repaired or altered in Singapore,
whether or not pursuant to a warranty,
are eligible for duty-free treatment,
provided that the requirements of this
section are met. For purposes of this
section, ‘‘repairs or alterations’’ means
restoration, addition, renovation, redyeing, cleaning, re-sterilizing, or
other treatment which does not destroy the essential characteristics of,
or create a new or commercially different good from, the good exported
from the United States.
(b) Goods not eligible for duty-free
treatment after repair or alteration. The
duty-free treatment referred to in
paragraph (a) of this section will not
apply to goods which, in their condition as exported from the United
States to Singapore, are incomplete for
their intended use and for which the
processing operation performed in
Singapore constitutes an operation
that is performed as a matter of course
in the preparation or manufacture of
finished goods.
(c) Documentation. The provisions of
paragraphs (a), (b), and (c) of § 10.8 of
this part, relating to the documentary
requirements for goods entered under
subheading 9802.00.40 or 9802.00.50,
HTSUS, will apply in connection with
the entry of goods which are returned
from Singapore after having been exported for repairs or alterations and
which are claimed to be duty free.

Subpart J—Dominican Republic—
Central
America—United
States Free Trade Agreement
SOURCE: CBP Dec. 08-22, 73 FR 33678, June
13, 2008, unless otherwise noted.

Scope.

This subpart implements the duty
preference and related customs provisions applicable to imported and exported goods under the Dominican Republic—Central
America—United
States Free Trade Agreement (the
CAFTA–DR) signed on August 5, 2004,
and under the Dominican Republic—
Central America—United States Free
Trade Agreement Implementation Act
(the Act; Pub. L. 109–53, 119 Stat. 462 (19
U.S.C. 4001 et seq.), as amended by section 1634 of the Pension Protection Act
of 2006 (Pub. L. 109–280, 120 Stat. 1167).
Except as otherwise specified in this
subpart, the procedures and other requirements set forth in this subpart
are in addition to the customs procedures and requirements of general application contained elsewhere in this
chapter. Additional provisions implementing certain aspects of the CAFTA–
DR and the Act are contained in parts
24, 162, and 163 of this chapter.
§ 10.582

General definitions.

As used in this subpart, the following
terms will have the meanings indicated
unless either the context in which they
are used requires a different meaning
or a different definition is prescribed
for a particular section of this subpart:
(a) Claim for preferential tariff treatment. ‘‘Claim for preferential tariff
treatment’’ means a claim that a good
is entitled to the duty rate applicable
under the CAFTA–DR to an originating
good or other good specified in the
CAFTA–DR, and to an exemption from
the merchandise processing fee;
(b) Claim of origin. ‘‘Claim of origin’’
means a claim that a textile or apparel
good is an originating good or a good of
a Party;
(c) Customs authority. ‘‘Customs authority’’ means the competent governmental unit that is responsible under
the law of a Party for the administration of customs laws and regulations;
(d) Customs duty. ‘‘Customs duty’’ includes any customs or import duty and
a charge of any kind imposed in connection with the importation of a good,

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U.S. Customs and Border Protection, DHS; Treasury
including any form of surtax or surcharge in connection with such importation, but, for purposes of implementing the CAFTA–DR, does not include any:
(1) Charge equivalent to an internal
tax imposed consistently with Article
III:2 of GATT 1994 in respect of like, directly competitive, or substitutable
goods of the Party, or in respect of
goods from which the imported good
has been manufactured or produced in
whole or in part;
(2) Antidumping or countervailing
duty that is applied pursuant to a Party’s domestic law; or
(3) Fee or other charge in connection
with importation commensurate with
the cost of services rendered;
(e) Customs Valuation Agreement.
‘‘Customs Valuation Agreement’’ means
the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994, which is part of the
WTO Agreement;
(f) Days. ‘‘Days’’ means calendar days;
(g) Enterprise. ‘‘Enterprise’’ means any
entity constituted or organized under
applicable law, whether or not for profit, and whether privately owned or governmentally owned, including any corporation, trust, partnership, sole proprietorship, joint venture, or other association;
(h) GATT 1994. ‘‘GATT 1994’’ means the
General Agreement on Tariffs and Trade
1994, which is part of the WTO Agreement;
(i) Harmonized System. ‘‘Harmonized
System’’ means the Harmonized Commodity Description and Coding System,
including its General Rules of Interpretation, Section Notes, and Chapter
Notes, as adopted and implemented by
the Parties in their respective tariff
laws;
(j) Heading. ‘‘Heading’’ means the first
four digits in the tariff classification
number under the Harmonized System;
(k) HTSUS. ‘‘HTSUS’’ means the Harmonized Tariff Schedule of the United
States as promulgated by the U.S.
International Trade Commission;
(l) Identical goods. ‘‘Identical goods’’
means goods that are produced in the
same country and are the same in all
respects, including physical characteristics, quality, and reputation, but ex-

§ 10.582

cluding minor differences in appearance.
(m) Indirect material. ‘‘Indirect material’’ means a good used in the production, testing, or inspection of a good in
the territory of one or more of the Parties but not physically incorporated
into the good, or a good used in the
maintenance of buildings or the operation of equipment associated with the
production of a good in the territory of
one or more of the Parties, including:
(1) Fuel and energy;
(2) Tools, dies, and molds;
(3) Spare parts and materials used in
the maintenance of equipment or
buildings;
(4) Lubricants, greases, compounding
materials, and other materials used in
production or used to operate equipment or buildings;
(5) Gloves, glasses, footwear, clothing, safety equipment, and supplies;
(6) Equipment, devices, and supplies
used for testing or inspecting the good;
(7) Catalysts and solvents; and
(8) Any other goods that are not incorporated into the good but the use of
which in the production of the good
can reasonably be demonstrated to be a
part of that production;
(n) Originating. ‘‘Originating’’ means
qualifying for preferential tariff treatment under the rules of origin set out
in CAFTA–DR Chapter Four (Rules of
Origin and Origin Procedures) and General Note 29, HTSUS;
(o) Party. ‘‘Party’’ means:
(1) The United States; and
(2) Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras,
or Nicaragua, for such time as the
CAFTA–DR is in force between the
United States and that country;
(p) Person. ‘‘Person’’ means a natural
person or an enterprise;
(q) Preferential tariff treatment. ‘‘Preferential tariff treatment’’ means the
duty rate applicable under the CAFTA–
DR to an originating good or other
good specified in the CAFTA–DR, and
an exemption from the merchandise
processing fee;
(r) Subheading. ‘‘Subheading’’ means
the first six digits in the tariff classification number under the Harmonized
System;
(s) Tariff preference level. ‘‘Tariff preference level’’ means a quantitative

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§ 10.583

19 CFR Ch. I (4–1–11 Edition)

limit for certain non-originating apparel goods that may be entitled to
preferential tariff treatment based on
the goods meeting the requirements set
forth in §§ 10.606 through 10.610 of this
subpart.
(t) Textile or apparel good. ‘‘Textile or
apparel good’’ means a good listed in
the Annex to the Agreement on Textiles and Clothing (commonly referred
to as ‘‘the ATC’’), which is part of the
WTO Agreement, except for those
goods listed in Annex 3.29 of the
CAFTA–DR;
(u) Territory. ‘‘Territory’’ means:
(1) With respect to each Party other
than the United States, the land, maritime, and air space under its sovereignty and the exclusive economic
zone and the continental shelf within
which it exercises sovereign rights and
jurisdiction in accordance with international law and its domestic law;
(2) With respect to the United States:
(i) The customs territory of the
United States, which includes the 50
states, the District of Columbia, and
Puerto Rico;
(ii) The foreign trade zones located in
the United States and Puerto Rico; and
(iii) Any areas beyond the territorial
seas of the United States within which,
in accordance with international law
and its domestic law, the United States
may exercise rights with respect to the
seabed and subsoil and their natural resources;
(v) WTO. ‘‘WTO’’ means the World
Trade Organization; and
(w) WTO Agreement. ‘‘WTO Agreement’’ means the Marrakesh Agreement
Establishing the World Trade Organization of April 15, 1994.
[CBP Dec. 08-22, 73 FR 33678, June 13, 2008, as
amended by CBP Dec. 10-26, 75 FR 50698, Aug.
17, 2010]

IMPORT REQUIREMENTS
§ 10.583 Filing of claim for preferential
tariff treatment upon importation.
(a) Basis of claim. An importer may
make a claim for CAFTA–DR preferential tariff treatment, including an
exemption from the merchandise processing fee, based on:
(1) A certification, as specified in
§ 10.584 of this subpart, that is prepared

by the importer, exporter, or producer
of the good; or
(2) The importer’s knowledge that
the good qualifies as an originating
good, including reasonable reliance on
information in the importer’s possession that the good is an originating
good.
(b) Making a claim. The claim is made
by including on the entry summary, or
equivalent documentation, the letter
‘‘P’’ or ‘‘P+’’ as a prefix to the subheading of the HTSUS under which
each qualifying good is classified, or by
the method specified for equivalent reporting via an authorized electronic
data interchange system.
(c) Corrected claim. If, after making
the claim specified in paragraph (b) of
this section, the importer has reason to
believe that the claim is based on inaccurate information or is otherwise invalid, the importer must, within 30 calendar days after the date of discovery
of the error, correct the claim and pay
any duties that may be due. The importer must submit a statement either
in writing or via an authorized electronic data interchange system to the
CBP office where the original claim
was filed specifying the correction (see
§§ 10.621 and 10.623 of this subpart).
[CBP Dec. 08-22, 73 FR 33678, June 13, 2008, as
amended by CBP Dec. 10-26, 75 FR 50699, Aug.
17, 2010]

§ 10.584 Certification.
(a) General. An importer who makes a
claim under § 10.583(b) of this subpart
based on a certification of the importer, exporter, or producer that the
good qualifies as originating must submit, at the request of the port director,
a copy of the certification. The certification:
(1) Need not be in a prescribed format
but must be in writing or must be
transmitted electronically pursuant to
any electronic means authorized by
CBP for that purpose;
(2) Must be in the possession of the
importer at the time the claim for
preferential tariff treatment is made if
the certification forms the basis for the
claim;
(3) Must include the following information:
(i) The legal name, address, telephone, and e-mail address (if any) of

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U.S. Customs and Border Protection, DHS; Treasury
the importer of record of the good, the
exporter of the good (if different from
the producer), and the producer of the
good;
(ii) The legal name, address, telephone, and e-mail address (if any) of
the responsible official or authorized
agent of the importer, exporter, or producer signing the certification (if different from the information required
by paragraph (a)(3)(i) of this section);
(iii) A description of the good for
which preferential tariff treatment is
claimed, which must be sufficiently detailed to relate it to the invoice and
the HS nomenclature;
(iv) The HTSUS tariff classification,
to six or more digits, as necessary for
the specific change in tariff classification rule for the good set forth in General Note 29(n), HTSUS; and
(v) The applicable rule of origin set
forth in General Note 29, HTSUS, under
which the good qualifies as an originating good; and
(4) Must include a statement, in substantially the following form:
‘‘I certify that:
The information on this document is true
and accurate and I assume the responsibility
for proving such representations. I understand that I am liable for any false statements or material omissions made on or in
connection with this document;
I agree to maintain and present upon request, documentation necessary to support
these representations;
The goods originated or are considered to
have originated in the territory of one or
more of the Parties, and comply with the origin requirements specified for those goods
in the Dominican Republic—Central America—United States Free Trade Agreement;
there has been no further production or any
other operation outside the territories of the
Parties, other than unloading, reloading, or
any other operation necessary to preserve
the goods in good condition or to transport
the goods to the United States; the goods remained under the control of customs authorities while in the territory of a nonParty; and
This document consists of ll pages, including all attachments.’’

(b) Responsible official or agent. The
certification provided for in paragraph
(a) of this section must be signed and
dated by a responsible official of the
importer, exporter, or producer, or by
the importer’s, exporter’s, or pro-

§ 10.585

ducer’s authorized agent having knowledge of the relevant facts.
(c) Language. The certification provided for in paragraph (a) of this section must be completed in either the
English language or the language of
the exporting Party. In the latter case,
the port director may require the importer to submit an English translation of the certification.
(d) Certification by the exporter or producer. A certification may be prepared
by the exporter or producer of the good
on the basis of:
(1) The exporter’s or producer’s
knowledge that the good is originating;
or
(2) In the case of an exporter, reasonable reliance on the producer’s certification that the good is originating.
(e) Applicability of certification. The
certification provided for in paragraph
(a) of this section may be applicable to:
(1) A single shipment of a good into
the United States; or
(2) Multiple shipments of identical
goods into the United States that
occur within a specified blanket period,
not exceeding 12 months, set out in the
certification.
(f) Validity of certification. A certification that is properly completed,
signed, and dated in accordance with
the requirements of this section will be
accepted as valid for four years following the date on which it was signed.
§ 10.585

Importer obligations.

(a) General. An importer who makes a
claim for preferential tariff treatment
under § 10.583(b) of this subpart:
(1) Will be deemed to have certified
that the good is eligible for preferential tariff treatment under the
CAFTA–DR;
(2) Is responsible for the truthfulness
of the claim and of all the information
and data contained in the certification
provided for in § 10.584 of this subpart;
(3) Is responsible for submitting any
supporting documents requested by
CBP, and for the truthfulness of the information contained in those documents. When a certification prepared
by an exporter or producer forms the
basis of a claim for preferential tariff
treatment, and CBP requests the submission of supporting documents, the

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§ 10.586

19 CFR Ch. I (4–1–11 Edition)

importer will provide to CBP, or arrange for the direct submission by the
exporter or producer, all information
relied on by the exporter or producer in
preparing the certification.
(b) Information provided by exporter or
producer. The fact that the importer
has made a claim or submitted a certification based on information provided by an exporter or producer will
not relieve the importer of the responsibility referred to in paragraph (a) of
this section.
(c) Exemption from penalties. An importer will not be subject to civil or administrative penalties under 19 U.S.C.
1592 for making an incorrect claim for
preferential tariff treatment or submitting an incorrect certification, provided that the importer promptly and
voluntarily corrects the claim or certification and pays any duty owing (see
§§ 10.621 and 10.623 of this subpart).
§ 10.586 Certification not required.
(a) General. Except as otherwise provided in paragraph (b) of this section,
an importer will not be required to submit a copy of a certification under
§ 10.584 of this subpart for:
(1) A non-commercial importation of
a good; or
(2) A commercial importation for
which the value of the originating
goods does not exceed U.S. $2,500.
(b) Exception. If the port director determines that an importation described
in paragraph (a) of this section is part
of a series of importations carried out
or planned for the purpose of evading
compliance with the certification requirements of § 10.584 of this subpart,
the port director will notify the importer that for that importation the
importer must submit to CBP a copy of
the certification. The importer must
submit such a copy within 30 days from
the date of the notice. Failure to timely submit a copy of the certification
will result in denial of the claim for
preferential tariff treatment.
§ 10.587 Maintenance of records.
(a) General. An importer claiming
preferential tariff treatment for a good
imported into the United States under
§ 10.583(b) of this subpart must maintain, for a minimum of five years after
the date of importation of the good, all

records and documents that the importer has demonstrating that the good
qualifies for preferential tariff treatment under the CAFTA–DR. These
records are in addition to any other
records that the importer is required to
prepare, maintain, or make available
to CBP under part 163 of this chapter.
(b) Method of maintenance. The
records and documents referred to in
paragraph (a) of this section must be
maintained by importers as provided in
§ 163.5 of this chapter.
§ 10.588 Effect of noncompliance; failure to provide documentation regarding transshipment.
(a) General. If the importer fails to
comply with any requirement under
this subpart, including submission of a
complete certification prepared in accordance with § 10.584 of this subpart,
when requested, the port director may
deny preferential tariff treatment to
the imported good.
(b) Failure to provide documentation regarding transshipment. Where the requirements for preferential tariff treatment set forth elsewhere in this subpart are met, the port director nevertheless may deny preferential tariff
treatment to an originating good if the
good is shipped through or transshipped in a country other than a
Party to the CAFTA–DR, and the importer of the good does not provide, at
the request of the port director, evidence demonstrating to the satisfaction of the port director that the conditions set forth in § 10.604(a) of this subpart were met.
EXPORT REQUIREMENTS
§ 10.589 Certification for goods exported to a Party.
(a) Submission of certification to CBP.
Any person who completes and issues a
certification for a good exported from
the United States to a Party must provide a copy of the certification (or such
other medium or format approved by
the Party’s customs authority for that
purpose) to CBP upon request.
(b) Notification of errors in certification. Any person who completes and
issues a certification for a good exported from the United States to a
Party and who has reason to believe
that the certification contains or is

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U.S. Customs and Border Protection, DHS; Treasury
based on incorrect information must
promptly notify every person to whom
the certification was provided of any
change that could affect the accuracy
or validity of the certification. Notification of an incorrect certification
must also be given either in writing or
via an authorized electronic data interchange system to CBP specifying the
correction (see §§ 10.622 and 10.623 of this
subpart).
(c) Maintenance of records—(1) General. Any person who completes and
issues a certification for a good exported from the United States to a
Party must maintain, for a period of at
least five years after the date the certification was signed, all records and
supporting documents relating to the
origin of a good for which the certification was issued, including the certification or copies thereof and records
and documents associated with:
(i) The purchase, cost, and value of,
and payment for, the good;
(ii) The purchase, cost, and value of,
and payment for, all materials, including indirect materials, used in the production of the good; and
(iii) The production of the good in
the form in which the good was exported.
(2) Method of maintenance. The
records referred to in paragraph (c) of
this section must be maintained as provided in § 163.5 of this chapter.
(3) Availability of records. For purposes of determining compliance with
the provisions of this part, the records
required to be maintained under this
section must be stored and made available for examination and inspection by
the port director or other appropriate
CBP officer in the same manner as provided in part 163 of this chapter.
POST-IMPORTATION DUTY REFUND
CLAIMS
§ 10.590 Right to make post-importation claim and refund duties.
Notwithstanding any other available
remedy, where a good would have
qualified as an originating good when
it was imported into the United States
but no claim for preferential tariff
treatment was made, the importer of
that good may file a claim for a refund
of any excess duties at any time within

§ 10.592

one year after the date of importation
of the good in accordance with the procedures set forth in § 10.591 of this subpart. Subject to the provisions of
§ 10.588 of this subpart, CBP may refund
any excess duties by liquidation or reliquidation of the entry covering the
good in accordance with § 10.592(c) of
this subpart.
§ 10.591 Filing procedures.
(a) Place of filing. A post-importation
claim for a refund must be filed with
the director of the port at which the
entry covering the good was filed.
(b) Contents of claim. A post-importation claim for a refund must be filed by
presentation of the following:
(1) A written declaration stating that
the good qualified as an originating
good at the time of importation and
setting forth the number and date of
the entry or entries covering the good;
(2) A copy of a certification prepared
in accordance with § 10.584 of this subpart if a certification forms the basis
for the claim, or other information
demonstrating that the good qualifies
for preferential tariff treatment;
(3) A written statement indicating
whether the importer of the good provided a copy of the entry summary or
equivalent documentation to any other
person. If such documentation was so
provided, the statement must identify
each recipient by name, CBP identification number, and address and must
specify the date on which the documentation was provided; and
(4) A written statement indicating
whether or not any person has filed a
protest relating to the good under any
provision of law; and if any such protest has been filed, the statement must
identify the protest by number and
date.
§ 10.592 CBP processing procedures.
(a) Status determination. After receipt
of a post-importation claim under
§ 10.591 of this subpart, the port director will determine whether the entry
covering the good has been liquidated
and, if liquidation has taken place,
whether the liquidation has become
final.
(b) Pending protest or judicial review. If
the port director determines that any
protest relating to the good has not

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§ 10.593

19 CFR Ch. I (4–1–11 Edition)

been finally decided, the port director
will suspend action on the claim filed
under § 10.591 of this subpart until the
decision on the protest becomes final.
If a summons involving the tariff classification or dutiability of the good is
filed in the Court of International
Trade, the port director will suspend
action on the claim filed under § 10.591
of this subpart until judicial review has
been completed.
(c) Allowance of claim—(1) Unliquidated entry. If the port director determines that a claim for a refund filed
under § 10.591 of this subpart should be
allowed and the entry covering the
good has not been liquidated, the port
director will take into account the
claim for refund in connection with the
liquidation of the entry.
(2) Liquidated entry. If the port director determines that a claim for a refund filed under § 10.591 of this subpart
should be allowed and the entry covering the good has been liquidated,
whether or not the liquidation has become final, the entry must be reliquidated in order to effect a refund of
duties under this section. If the entry
is otherwise to be reliquidated based on
administrative review of a protest or as
a result of judicial review, the port director will reliquidate the entry taking
into account the claim for refund under
§ 10.591 of this subpart.
(d) Denial of claim—(1) General. The
port director may deny a claim for a
refund filed under § 10.591 of this subpart if the claim was not filed timely,
if the importer has not complied with
the requirements of §§ 10.588 and 10.591
of this subpart, or if, following an origin verification under § 10.616 of this
subpart, the port director determines
either that the imported good did not
qualify as an originating good at the
time of importation or that a basis exists upon which preferential tariff
treatment may be denied under § 10.616
of this subpart.
(2) Unliquidated entry. If the port director determines that a claim for a refund filed under this subpart should be
denied and the entry covering the good
has not been liquidated, the port director will deny the claim in connection
with the liquidation of the entry, and
notice of the denial and the reason for
the denial will be provided to the im-

porter in writing or via an authorized
electronic data interchange system.
(3) Liquidated entry. If the port director determines that a claim for a refund filed under this subpart should be
denied and the entry covering the good
has been liquidated, whether or not the
liquidation has become final, the claim
may be denied without reliquidation of
the entry. If the entry is otherwise to
be reliquidated based on administrative review of a protest or as a result of
judicial review, such reliquidation may
include denial of the claim filed under
this subpart. In either case, the port director will provide notice of the denial
and the reason for the denial to the importer in writing or via an authorized
electronic data interchange system.
[CBP Dec. 08-22, 73 FR 33678, June 13, 2008, as
amended by CBP Dec. 10-26, 75 FR 50699, Aug.
17, 2010]

RULES OF ORIGIN
§ 10.593

Definitions.

For purposes of §§ 10.593 through
10.605:
(a) Adjusted value. ‘‘Adjusted value’’
means the value determined in accordance with Articles 1 through 8, Article
15, and the corresponding interpretative notes of the Customs Valuation
Agreement, adjusted, if necessary, to
exclude:
(1) Any costs, charges, or expenses incurred for transportation, insurance
and related services incident to the
international shipment of the good
from the country of exportation to the
place of importation; and
(2) The value of packing materials
and containers for shipment as defined
in paragraph (m) of this section;
(b) Class of motor vehicles. ‘‘Class of
motor vehicles’’ means any one of the
following categories of motor vehicles:
(1) Motor vehicles provided for in
subheading 8701.20, 8704.10, 8704.22,
8704.23, 8704.32, or 8704.90, or heading
8705 or 8706, HTSUS, or motor vehicles
for the transport of 16 or more persons
provided for in subheading 8702.10 or
8702.90, HTSUS;
(2) Motor vehicles provided for in
subheading 8701.10 or any of subheadings
8701.30
through
8701.90,
HTSUS;

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U.S. Customs and Border Protection, DHS; Treasury
(3) Motor vehicles for the transport
of 15 or fewer persons provided for in
subheading 8702.10 or 8702.90, HTSUS,
or motor vehicles provided for in subheading 8704.21 or 8704.31, HTSUS; or
(4) Motor vehicles provided for in
subheadings 8703.21 through 8703.90,
HTSUS;
(c) Exporter. ‘‘Exporter’’ means a person who exports goods from the territory of a Party;
(d) Fungible good or material. ‘‘Fungible good or material’’ means a good
or material, as the case may be, that is
interchangeable with another good or
material for commercial purposes and
the properties of which are essentially
identical to such other good or material;
(e) Generally Accepted Accounting
Principles. ‘‘Generally Accepted Accounting Principles’’ means the recognized consensus or substantial authoritative support in the territory of a
Party, with respect to the recording of
revenues, expenses, costs, assets, and
liabilities, the disclosure of information, and the preparation of financial
statements. These principles may encompass broad guidelines of general application as well as detailed standards,
practices, and procedures;
(f) Good. ‘‘Good’’ means any merchandise, product, article, or material;
(g) Goods wholly obtained or produced
entirely in the territory of one or more of
the Parties. ‘‘Goods wholly obtained or
produced entirely in the territory of
one or more of the Parties’’ means:
(1) Plants and plant products harvested or gathered in the territory of
one or more of the Parties;
(2) Live animals born and raised in
the territory of one or more of the Parties;
(3) Goods obtained in the territory of
one or more of the Parties from live
animals;
(4) Goods obtained from hunting,
trapping, fishing, or aquaculture conducted in the territory of one or more
of the Parties;
(5) Minerals and other natural resources not included in paragraphs
(g)(1) through (g)(4) of this section that
are extracted or taken in the territory
of one or more of the Parties;
(6) Fish, shellfish, and other marine
life taken from the sea, seabed, or sub-

§ 10.593

soil outside the territory of one or
more of the Parties by vessels registered or recorded with a Party and
flying its flag;
(7) Goods produced on board factory
ships from the goods referred to in
paragraph (g)(6) of this section, if such
factory ships are registered or recorded
with a Party and flying its flag;
(8) Goods taken by a Party or a person of a Party from the seabed or subsoil outside territorial waters, if a
Party has rights to exploit such seabed
or subsoil;
(9) Goods taken from outer space,
provided they are obtained by a Party
or a person of a Party and not processed in the territory of a non-Party;
(10) Waste and scrap derived from:
(i) Manufacturing or processing operations in the territory of one or more
of the Parties; or
(ii) Used goods collected in the territory of one or more of the Parties, if
such goods are fit only for the recovery
of raw materials;
(11) Recovered goods derived in the
territory of one or more of the Parties
from used goods, and used in the territory of a Party in the production of remanufactured goods; and
(12) Goods produced in the territory
of one or more of the Parties exclusively from goods referred to in any of
paragraphs (g)(1) through (g)(10) of this
section, or from the derivatives of such
goods, at any stage of production;
(h) Material. ‘‘Material’’ means a good
that is used in the production of another good, including a part or an ingredient;
(i) Model line. ‘‘Model line’’ means a
group of motor vehicles having the
same platform or model name;
(j) Net cost. ‘‘Net cost’’ means total
cost minus sales promotion, marketing, and after-sales service costs,
royalties, shipping and packing costs,
and non-allowable interest costs that
are included in the total cost;
(k) Non-allowable interest costs. ‘‘Nonallowable interest costs’’ means interest costs incurred by a producer that
exceed 700 basis points above the applicable official interest rates for comparable maturities of the Party in
which the producer is located;
(l) Non-originating good or non-originating material. ‘‘Non-originating good’’

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§ 10.593

19 CFR Ch. I (4–1–11 Edition)

or ‘‘non-originating material’’ means a
good or material, as the case may be,
that does not qualify as originating
under General Note 29, HTSUS, or this
subpart;
(m) Packing materials and containers
for shipment. ‘‘Packing materials and
containers for shipment’’ means the
goods used to protect a good during its
transportation to the United States,
and does not include the packaging materials and containers in which a good
is packaged for retail sale;
(n) Producer. ‘‘Producer’’ means a person who engages in the production of a
good in the territory of a Party;
(o) Production. ‘‘Production’’ means
growing, mining, harvesting, fishing,
raising, trapping, hunting, manufacturing, processing, assembling, or disassembling a good;
(p) Reasonably allocate. ‘‘Reasonably
allocate’’ means to apportion in a manner that would be appropriate under
Generally Accepted Accounting Principles;
(q) Recovered goods. ‘‘Recovered goods’’
means materials in the form of individual parts that are the result of:
(1) The disassembly of used goods
into individual parts; and
(2) The cleaning, inspecting, testing,
or other processing that is necessary to
improve such individual parts to sound
working condition;
(r) Remanufactured good. ‘‘Remanufactured good’’ means a good that is
classified in Chapter 84, 85, or 87, or
heading 9026, 9031, or 9032, HTSUS,
other than a good classified in heading
8418 or 8516, HTSUS, and that:
(1) Is entirely or partially comprised
of recovered goods; and
(2) Has a similar life expectancy and
enjoys a factory warranty similar to a
new good that is classified in one of the
enumerated HTSUS chapters or headings;
(s) Royalties. ‘‘Royalties’’ means payments of any kind, including payments
under technical assistance agreements
or similar agreements, made as consideration for the use of, or right to use,
any copyright, literary, artistic, or scientific work, patent, trademark, design, model, plan, secret formula or
process, excluding those payments
under technical assistance agreements

or similar agreements that can be related to specific services such as:
(1) Personnel training, without regard to where performed; and
(2) If performed in the territory of
one or more of the Parties, engineering, tooling, die-setting, software design and similar computer services;
(t) Sales promotion, marketing, and
after-sales service costs. ‘‘Sales promotion, marketing, and after-sales
service costs’’ means the following
costs related to sales promotion, marketing, and after-sales service:
(1) Sales and marketing promotion;
media advertising; advertising and
market research; promotional and
demonstration
materials;
exhibits;
sales conferences, trade shows and conventions; banners; marketing displays;
free samples; sales, marketing and
after-sales service literature (product
brochures, catalogs, technical literature, price lists, service manuals,
sales aid information); establishment
and protection of logos and trademarks; sponsorships; wholesale and retail restocking charges; entertainment;
(2) Sales and marketing incentives;
consumer, retailer or wholesaler rebates; merchandise incentives;
(3) Salaries and wages, sales commissions, bonuses, benefits (for example,
medical, insurance, pension), traveling
and living expenses, membership and
professional fees, for sales promotion,
marketing and after-sales service personnel;
(4) Recruiting and training of sales
promotion, marketing and after-sales
service personnel, and after-sales training of customers’ employees, where
such costs are identified separately for
sales promotion, marketing and aftersales service of goods on the financial
statements or cost accounts of the producer;
(5) Product liability insurance;
(6) Office supplies for sales promotion, marketing and after-sales
service of goods, where such costs are
identified separately for sales promotion, marketing and after-sales
service of goods on the financial statements or cost accounts of the producer;
(7) Telephone, mail and other communications, where such costs are
identified separately for sales promotion, marketing and after-sales

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U.S. Customs and Border Protection, DHS; Treasury
service of goods on the financial statements or cost accounts of the producer;
(8) Rent and depreciation of sales
promotion, marketing and after-sales
service offices and distribution centers;
(9) Property insurance premiums,
taxes, cost of utilities, and repair and
maintenance of sales promotion, marketing and after-sales service offices
and distribution centers, where such
costs are identified separately for sales
promotion, marketing and after-sales
service of goods on the financial statements or cost accounts of the producer;
and
(10) Payments by the producer to
other persons for warranty repairs;
(u) Self-produced material. ‘‘Self-produced material’’ means an originating
material that is produced by a producer of a good and used in the production of that good;
(v) Shipping and packing costs. ‘‘Shipping and packing costs’’ means the
costs incurred in packing a good for
shipment and shipping the good from
the point of direct shipment to the
buyer, excluding the costs of preparing
and packaging the good for retail sale;
(w) Total cost. ‘‘Total cost’’ means all
product costs, period costs, and other
costs for a good incurred in the territory of one or more of the Parties.
Product costs are costs that are associated with the production of a good and
include the value of materials, direct
labor costs, and direct overhead. Period
costs are costs, other than product
costs, that are expensed in the period
in which they are incurred, such as
selling expenses and general and administrative expenses. Other costs are
all costs recorded on the books of the
producer that are not product costs or
period costs, such as interest. Total
cost does not include profits that are
earned by the producer, regardless of
whether they are retained by the producer or paid out to other persons as
dividends, or taxes paid on those profits, including capital gains taxes;
(x) Used. ‘‘Used’’ means used or consumed in the production of goods; and
(y) Value. ‘‘Value’’ means the value of
a good or material for purposes of cal-

§ 10.595

culating customs duties or for purposes
of applying this subpart.
[CBP Dec. 08-22, 73 FR 33678, June 13, 2008, as
amended by CBP Dec. 10-26, 75 FR 50699, Aug.
17, 2010]

§ 10.594 Originating goods.
Except as otherwise provided in this
subpart and General Note 29(m),
HTSUS, a good imported into the customs territory of the United States
will be considered an originating good
under the CAFTA-DR only if:
(a) The good is wholly obtained or
produced entirely in the territory of
one or more of the Parties;
(b) The good is produced entirely in
the territory of one or more of the Parties and:
(1) Each non-originating material
used in the production of the good undergoes an applicable change in tariff
classification specified in General Note
29(n), HTSUS, and the good satisfies all
other applicable requirements of General Note 29, HTSUS; or
(2) The good otherwise satisfies any
applicable regional value content or
other requirements specified in General Note 29(n), HTSUS, and satisfies
all other applicable requirements of
General Note 29, HTSUS; or
(c) The good is produced entirely in
the territory of one or more of the Parties exclusively from originating materials.
§ 10.595 Regional value content.
(a) General. Except for goods to which
paragraph (d) of this section applies,
where General Note 29(n), HTSUS, sets
forth a rule that specifies a regional
value content test for a good, the regional value content of such good must
be calculated by the importer, exporter, or producer of the good on the
basis of the build-down method described in paragraph (b) of this section
or the build-up method described in
paragraph (c) of this section.
(b) Build-down method. Under the
build-down method, the regional value
content must be calculated on the
basis
of
the
formula
RVC
=
((AV¥VNM)/AV) × 100, where RVC is
the regional value content, expressed
as a percentage; AV is the adjusted
value of the good; and VNM is the
value of non-originating materials that

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§ 10.595

19 CFR Ch. I (4–1–11 Edition)

are acquired and used by the producer
in the production of the good, but does
not include the value of a material
that is self-produced.
(c) Build-up method. Under the buildup method, the regional value content
must be calculated on the basis of the
formula RVC = (VOM/AV) × 100, where
RVC is the regional value content, expressed as a percentage; AV is the adjusted value of the good; and VOM is
the value of originating materials that
are acquired or self-produced and used
by the producer in the production of
the good.
(d) Special rule for certain automotive
goods—(1) General. Where General Note
29(n), HTSUS, sets forth a rule that
specifies a regional value content test
for an automotive good provided for in
any of subheadings 8407.31 through
8407.34, subheading 8408.20, heading
8409, or headings 8701 through 8708,
HTSUS, the regional value content of
such good may be calculated by the importer, exporter, or producer of the
good on the basis of the net cost method described in paragraph (d)(2) of this
section.
(2) Net cost method. Under the net cost
method, the regional value content is
calculated on the basis of the formula
RVC = ((NC–VNM)/NC) × 100, where
RVC is the regional value content, expressed as a percentage; NC is the net
cost of the good; and VNM is the value
of non-originating materials that are
acquired and used by the producer in
the production of the good, but does
not include the value of a material
that is self-produced. Consistent with
the provisions regarding allocation of
costs set out in Generally Accepted Accounting Principles, the net cost of the
good must be determined by:
(i) Calculating the total cost incurred
with respect to all goods produced by
the producer of the automotive good,
subtracting any sales promotion, marketing and after-sales service costs,
royalties, shipping and packing costs,
and non-allowable interest costs that
are included in the total cost of all
such goods, and then reasonably allocating the resulting net cost of those
goods to the automotive good;
(ii) Calculating the total cost incurred with respect to all goods produced by the producer of the auto-

motive good, reasonably allocating the
total cost to the automotive good, and
then subtracting any sales promotion,
marketing and after-sales service
costs, royalties, shipping and packing
costs, and non-allowable interest costs
that are included in the portion of the
total cost allocated to the automotive
good; or
(iii) Reasonably allocating each cost
that forms part of the total costs incurred with respect to the automotive
good so that the aggregate of these
costs does not include any sales promotion, marketing and after-sales
service costs, royalties, shipping and
packing costs, or non-allowable interest costs.
(3) Motor vehicles—(i) General. For
purposes of calculating the regional
value content under the net cost method for an automotive good that is a
motor vehicle provided for in any of
headings 8701 through 8705, an importer, exporter, or producer may average the amounts calculated under the
formula set forth in paragraph (d)(2) of
this section over the producer’s fiscal
year using any one of the categories
described in paragraph (d)(3)(ii) of this
section either on the basis of all motor
vehicles in the category or those motor
vehicles in the category that are exported to the territory of one or more
Parties.
(ii) Categories. The categories referred
to in paragraph (d)(3)(i) of this section
are as follows:
(A) The same model line of motor vehicles, in the same class of vehicles,
produced in the same plant in the territory of a Party, as the motor vehicle
for which the regional value content is
being calculated;
(B) The same class of motor vehicles,
and produced in the same plant in the
territory of a Party, as the motor vehicle for which the regional value content is being calculated; and
(C) The same model line of motor vehicles produced in the territory of a
Party as the motor vehicle for which
the regional value content is being calculated.
(4) Other automotive goods—(i) General.
For purposes of calculating the regional value content under the net cost
method for automotive goods provided
for in any of subheadings 8407.31

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U.S. Customs and Border Protection, DHS; Treasury
through 8407.34, subheading 8408.20,
heading 8409, 8706, 8707, or 8708, HTSUS,
that are produced in the same plant, an
importer, exporter, or producer may:
(A) Average the amounts calculated
under the formula set forth in paragraph (d)(2) of this section over any of
the following: The fiscal year, or any
quarter or month, of the motor vehicle
producer to whom the automotive good
is sold, or the fiscal year, or any quarter or month, of the producer of the
automotive good, provided the goods
were produced during the fiscal year,
quarter, or month that is the basis for
the calculation;
(B) Determine the average referred to
in paragraph (d)(4)(i) of this section
separately for such goods sold to one or
more motor vehicle producers; or
(C) Make a separate determination
under paragraph (d)(4)(i) or (d)(4)(ii) for
automotive goods that are exported to
the territory of one or more Parties.
(ii) Duration of use. A person selecting an averaging period of one month
or quarter under paragraph (d)(4)(i)(A)
of this section must continue to use
that method for that category of automotive goods throughout the fiscal
year.
[CBP Dec. 08-22, 73 FR 33678, June 13, 2008, as
amended by CBP Dec. 10-26, 75 FR 50699, Aug.
17, 2010]

§ 10.596 Value of materials.
(a) Calculating the value of materials.
Except as provided in § 10.603, for purposes of calculating the regional value
content of a good under General Note
29(n), HTSUS, and for purposes of applying the de minimis (see § 10.598 of this
subpart) provisions of General Note
29(n), HTSUS, the value of a material
is:
(1) In the case of a material imported
by the producer of the good, the adjusted value of the material;
(2) In the case of a material acquired
by the producer in the territory where
the good is produced, the value, determined in accordance with Articles 1
through 8, Article 15, and the corresponding interpretative notes of the
Customs Valuation Agreement, of the
material with reasonable modifications
to the provisions of the Customs Valuation Agreement as may be required
due to the absence of an importation

§ 10.596

by the producer (including, but not
limited to, treating a domestic purchase by the producer as if it were a
sale for export to the country of importation); or
(3) In the case of a self-produced material, the sum of:
(i) All expenses incurred in the production of the material, including general expenses; and
(ii) An amount for profit equivalent
to the profit added in the normal
course of trade.
(b) Examples. The following examples
illustrate application of the principles
set forth in paragraph (a)(2) of this section:
Example 1. A producer in El Salvador purchases material x from an unrelated seller in
El Salvador for $100. Under the provisions of
Article 1 of the Customs Valuation Agreement, transaction value is the price actually
paid or payable for the goods when sold for
export to the country of importation adjusted in accordance with the provisions of
Article 8. In order to apply Article 1 to this
domestic purchase by the producer, such purchase is treated as if it were a sale for export
to the country of importation. Therefore, for
purposes of determining the adjusted value
of material x, Article 1 transaction value is
the price actually paid or payable for the
goods when sold to the producer in El Salvador ($100), adjusted in accordance with the
provisions of Article 8. In this example, it is
irrelevant whether material x was initially
imported into El Salvador by the seller (or
by anyone else). So long as the producer acquired material x in El Salvador, it is intended that the value of material x will be
determined on the basis of the price actually
paid or payable by the producer adjusted in
accordance with the provisions of Article 8.
Example 2. Same facts as in Example 1, except that the sale between the seller and the
producer is subject to certain restrictions
that preclude the application of Article 1.
Under Article 2 of the Customs Valuation
Agreement, the value is the transaction
value of identical goods sold for export to
the same country of importation and exported at or about the same time as the
goods being valued. In order to permit the
application of Article 2 to the domestic acquisition by the producer, it should be modified so that the value is the transaction
value of identical goods sold within El Salvador at or about the same time the goods
were sold to the producer in El Salvador.
Thus, if the seller of material x also sold an
identical material to another buyer in El
Salvador without restrictions, that other
sale would be used to determine the adjusted
value of material x.

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§ 10.597

19 CFR Ch. I (4–1–11 Edition)

(c) Permissible additions to, and deductions from, the value of materials—(1) Additions to originating materials. For originating materials, the following expenses, if not included under paragraph
(a) of this section, may be added to the
value of the originating material:
(i) The costs of freight, insurance,
packing, and all other costs incurred in
transporting the material within or between the territory of one or more of
the Parties to the location of the producer;
(ii) Duties, taxes, and customs brokerage fees on the material paid in the
territory of one or more of the Parties,
other than duties and taxes that are
waived, refunded, refundable, or otherwise recoverable, including credit
against duty or tax paid or payable;
and
(iii) The cost of waste and spoilage
resulting from the use of the material
in the production of the good, less the
value of renewable scrap or byproducts.
(2) Deductions from non-originating materials. For non-originating materials,
if included under paragraph (a) of this
section, the following expenses may be
deducted from the value of the nonoriginating material:
(i) The costs of freight, insurance,
packing, and all other costs incurred in
transporting the material within or between the territory of one or more of
the Parties to the location of the producer;
(ii) Duties, taxes, and customs brokerage fees on the material paid in the
territory of one or more of the Parties,
other than duties and taxes that are
waived, refunded, refundable, or otherwise recoverable, including credit
against duty or tax paid or payable;
(iii) The cost of waste and spoilage
resulting from the use of the material
in the production of the good, less the
value of renewable scrap or by-products; and
(iv) The cost of originating materials
used in the production of the non-originating material in the territory of one
or more of the Parties.
(d) Accounting method. Any cost or
value referenced in General Note 29,
HTSUS, and this subpart, must be recorded and maintained in accordance
with the Generally Accepted Accounting Principles applicable in the terri-

tory of the Party in which the good is
produced.
§ 10.597

Accumulation.

(a) Originating materials from the
territory of one or more of the Parties
that are used in the production of a
good in the territory of another Party
will be considered to originate in the
territory of that other Party.
(b) A good that is produced in the
territory of one or more of the Parties
by one or more producers is an originating good if the good satisfies the requirements of § 10.594 of this subpart
and all other applicable requirements
of General Note 29, HTSUS.
§ 10.598

De minimis.

(a) General. Except as provided in
paragraphs (b) and (c) of this section, a
good that does not undergo a change in
tariff classification pursuant to General Note 29(n), HTSUS, is an originating good if:
(1) The value of all non-originating
materials used in the production of the
good that do not undergo the applicable change in tariff classification does
not exceed 10 percent of the adjusted
value of the good;
(2) The value of the non-originating
materials described in paragraph (a)(1)
of this section is included in the value
of non-originating materials for any
applicable regional value content requirement for the good under General
Note 29(n), HTSUS; and
(3) The good meets all other applicable requirements of General Note 29,
HTSUS.
(b) Exceptions. Paragraph (a) does not
apply to:
(1) A non-originating material provided for in Chapter 4, HTSUS, or a
non-originating dairy preparation containing over 10 percent by weight of
milk solids provided for in subheading
1901.90 or 2106.90, HTSUS, that is used
in the production of a good provided for
in Chapter 4, HTSUS;
(2) A non-originating material provided for in Chapter 4, HTSUS, or a
non-originating dairy preparation containing over 10 percent by weight of
milk solids provided for in subheading
1901.90, HTSUS, that is used in the production of the following goods:

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U.S. Customs and Border Protection, DHS; Treasury
(i) Infant preparations containing
over 10 percent by weight of milk solids
provided for in subheading 1901.10,
HTSUS;
(ii) Mixes and doughs, containing
over 25 percent by weight of butterfat,
not put up for retail sale, provided for
in subheading 1901.20, HTSUS;
(iii) Dairy preparations containing
over 10 percent by weight of milk solids
provided for in subheading 1901.90 or
2106.90, HTSUS;
(iv) Goods provided for in heading
2105, HTSUS;
(v) Beverages containing milk provided for in subheading 2202.90, HTSUS;
and
(vi) Animal feeds containing over 10
percent by weight of milk solids provided for in subheading 2309.90, HTSUS;
and
(3) A non-originating material provided for in heading 0805, HTSUS, or
any of subheadings 2009.11 through
2009.39, HTSUS, that is used in the production of a good provided for in any of
subheadings 2009.11 through 2009.39,
HTSUS, or in fruit or vegetable juice of
any single fruit or vegetable, fortified
with minerals or vitamins, concentrated or unconcentrated, provided
for in subheading 2106.90 or 2202.90,
HTSUS;
(4) A non-originating material provided for in heading 0901 or 2101,
HTSUS, that is used in the production
of a good provided for in heading 0901
or 2101, HTSUS;
(5) A non-originating material provided for in heading 1006, HTSUS, that
is used in the production of a good provided for in heading 1102 or 1103,
HTSUS, or subheading 1904.90, HTSUS;
(6) A non-originating material provided for in Chapter 15, HTSUS, that is
used in the production of a good provided for in Chapter 15, HTSUS;
(7) A non-originating material provided for in heading 1701, HTSUS, that
is used in the production of a good provided for in any of headings 1701
through 1703, HTSUS;
(8) A non-originating material provided for in Chapter 17, HTSUS, that is
used in the production of a good provided for in subheading 1806.10, HTSUS;
and
(9) Except as provided in paragraphs
(b)(1) through (b)(8) of this section and

§ 10.598

General Note 29(n), HTSUS, a non-originating material used in the production
of a good provided for in any of Chapters 1 through 24, HTSUS, unless the
non-originating material is provided
for in a different subheading than the
good for which origin is being determined under this subpart.
(c) Textile and apparel goods—(1) General. Except as provided in paragraph
(c)(2) of this section, a textile or apparel good that is not an originating
good because certain fibers or yarns
used in the production of the component of the good that determines the
tariff classification of the good do not
undergo an applicable change in tariff
classification set out in General Note
29(n), HTSUS, will nevertheless be considered to be an originating good if:
(i) The total weight of all such fibers
or yarns in that component is not more
than 10 percent of the total weight of
that component; or
(ii) The yarns are nylon filament
yarns (other than elastomeric yarns)
that are provided for in subheading
5402.11.30, 5402.11.60, 5402.31.30, 5402.31.60,
5402.32.30, 5402.32.60, 5402.45.10, 5402.45.90,
5402.51.00, or 5402.61.00, HTSUS, and
that are products of Canada, Mexico, or
Israel.
(2) Exception for goods containing elastomeric yarns. A textile or apparel good
containing elastomeric yarns (excluding latex) in the component of the good
that determines the tariff classification of the good will be considered an
originating good only if such yarns are
wholly formed in the territory of a
Party. For purposes of this paragraph,
‘‘wholly formed’’ means that all the production processes and finishing operations, starting with the extrusion of
filaments, strips, film, or sheet, and including slitting a film or sheet into
strip, or the spinning of all fibers into
yarn, or both, and ending with a finished yarn or plied yarn, took place in
the territory of a Party.
(3) Yarn, fabric, or fiber. For purposes
of paragraph (c) of this section, in the
case of a textile or apparel good that is
a yarn, fabric, or fiber, the term ‘‘component of the good that determines the

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§ 10.599

19 CFR Ch. I (4–1–11 Edition)

tariff classification of the good’’ means
all of the fibers in the good.
[CBP Dec. 08-22, 73 FR 33678, June 13, 2008, as
amended by CBP Dec. 10-26, 75 FR 50699, Aug.
17, 2010]

§ 10.599 Fungible goods and materials.
(a) General. A person claiming that a
fungible good or material is an originating good may base the claim either
on the physical segregation of the fungible good or material or by using an
inventory management method with
respect to the fungible good or material. For purposes of this section, the
term ‘‘inventory management method’’
means:
(1) Averaging;
(2) ‘‘Last-in, first-out;’’
(3) ‘‘First-in, first-out;’’ or
(4) Any other method that is recognized in the Generally Accepted Accounting Principles of the Party in
which the production is performed or
otherwise accepted by that country.
(b) Duration of use. A person selecting
an inventory management method
under paragraph (a) of this section for
a particular fungible good or material
must continue to use that method for
that
fungible
good
or
material
throughout the fiscal year of that person.
§ 10.600 Accessories, spare parts, or
tools.
(a) General. Accessories, spare parts,
or tools that are delivered with a good
and that form part of the good’s standard accessories, spare parts, or tools
will be treated as originating goods if
the good is an originating good, and
will be disregarded in determining
whether all the non-originating materials used in the production of the good
undergo an applicable change in tariff
classification specified in General Note
29(n), HTSUS, provided that:
(1) The accessories, spare parts, or
tools are classified with, and not
invoiced separately from, the good, regardless of whether they appear specified or separately identified in the invoice for the good; and
(2) The quantities and value of the
accessories, spare parts, or tools are
customary for the good.
(a) Regional value content. If the good
is subject to a regional value content

requirement, the value of the accessories, spare parts, or tools is taken
into account as originating or nonoriginating materials, as the case may
be, in calculating the regional value
content of the good under § 10.595 of
this subpart.
§ 10.601 Retail packaging
and containers.

materials

(a) Effect on tariff shift rule. Packaging materials and containers in
which a good is packaged for retail
sale, if classified with the good for
which preferential tariff treatment
under the CAFTA–DR is claimed, will
be disregarded in determining whether
all non-originating materials used in
the production of the good undergo the
applicable change in tariff classification set out in General Note 29(n),
HTSUS.
(b) Effect on regional value content calculation. If the good is subject to a regional value content requirement, the
value of such packaging materials and
containers will be taken into account
as originating or non-originating materials, as the case may be, in calculating
the regional value content of the good.
Example 1. Guatemalan Producer A of good
C imports 100 non-originating blister packages to be used as retail packaging for good
C. As provided in § 10.596(a)(1) of this subpart,
the value of the blister packages is their adjusted value, which in this case is $10. Good
C has a regional value content requirement.
The United States importer of good C decides
to use the build-down method, RVC = ((AV–
VNM)/AV) × 100 (see § 10.595(b) of this subpart), in determining whether good C satisfies the regional value content requirement.
In applying this method, the non-originating
blister packages are taken into account as
non-originating. As such, their $10 adjusted
value is included in the VNM, value of nonoriginating materials, of good C.
Example 2. Same facts as in Example 1, except that the blister packages are originating. In this case, the adjusted value of the
originating blister packages would not be included as part of the VNM of good C under
the build-down method. However, if the U.S.
importer had used the build-up method, RVC
= (VOM/AV) ×100 (see § 10.595(c) of this subpart), the adjusted value of the blister packaging would be included as part of the VOM,
value of originating material.

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U.S. Customs and Border Protection, DHS; Treasury
§ 10.602 Packing materials and containers for shipment.
(a) Effect on tariff shift rule. Packing
materials and containers for shipment,
as defined in § 10.593(m) of this subpart,
are to be disregarded in determining
whether the non-originating materials
used in the production of the good undergo an applicable change in tariff
classification set out in General Note
29(n), HTSUS. Accordingly, such materials and containers are not required to
undergo the applicable change in tariff
classification even if they are non-originating.
(b) Effect on regional value content calculation. Packing materials and containers for shipment, as defined in
§ 10.593(m) of this subpart, are to be disregarded in determining the regional
value content of a good imported into
the United States. Accordingly, in applying the build-down, build-up, or net
cost method for determining the regional value content of a good imported into the United States, the
value of such packing materials and
containers for shipment (whether originating or non-originating) is disregarded and not included in AV, adjusted value, VNM, value of non-originating materials, VOM, value of originating materials, or NC, net cost of a
good.
Example. Producer A of the Dominican Republic produces good C. Producer A ships
good C to the United States in a shipping
container that it purchased from Company B
in the Dominican Republic. The shipping
container is originating. The value of the
shipping container determined under section
§ 10.596(a)(2) of this subpart is $3. Good C is
subject to a regional value content requirement. The transaction value of good C is
$100, which includes the $3 shipping container. The United States importer decides
to use the build-up method, RVC = (VOM/AV)
× 100 (see § 10.595(c) of this subpart), in determining whether good C satisfies the regional
value content requirement. In determining
the AV, adjusted value, of good C imported
into the U.S., paragraph (b) of this section
and the definition of AV require a $3 deduction for the value of the shipping container.
Therefore, the AV is $97 ($100¥$3). In addition, the value of the shipping container is
disregarded and not included in the VOM,
value of originating materials.

§ 10.605

§ 10.603 Indirect materials.
An indirect material, as defined in
§ 10.582(m) of this subpart, will be considered to be an originating material
without regard to where it is produced.
Example. Honduran Producer C produces
good C using non-originating material A.
Producer C imports non-originating rubber
gloves for use by workers in the production
of good C. Good C is subject to a tariff shift
requirement. As provided in § 10.594(b)(1) of
this subpart and General Note 29(n), each of
the non-originating materials in good C
must undergo the specified change in tariff
classification in order for good C to be considered originating. Although non-originating material A must undergo the applicable tariff shift in order for good C to be considered originating, the rubber gloves do not
because they are indirect materials and are
considered originating without regard to
where they are produced.

§ 10.604 Transit and transshipment.
(a) General. A good that has undergone production necessary to qualify as
an originating good under § 10.594 of
this subpart will not be considered an
originating good if, subsequent to that
production, the good:
(1) Undergoes further production or
any other operation outside the territories of the Parties, other than unloading, reloading, or any other operation necessary to preserve the good in
good condition or to transport the good
to the territory of a Party; or
(2) Does not remain under the control
of customs authorities in the territory
of a non-Party.
(b) Documentary evidence. An importer making a claim that a good is
originating may be required to demonstrate, to CBP’s satisfaction, that
the conditions and requirements set
forth in paragraph (a) of this section
were met. An importer may demonstrate compliance with this section
by submitting documentary evidence.
Such evidence may include, but is not
limited to, bills of lading, airway bills,
packing lists, commercial invoices, receiving and inventory records, and customs entry and exit documents.
§ 10.605 Goods classifiable as goods
put up in sets.
Notwithstanding the specific rules
set forth in General Note 29(n), HTSUS,
goods classifiable as goods put up in

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§ 10.606

19 CFR Ch. I (4–1–11 Edition)

sets for retail sale as provided for in
General Rule of Interpretation 3,
HTSUS, will not be considered to be
originating goods unless:
(a) Each of the goods in the set is an
originating good; or
(b) The total value of the non-originating goods in the set does not exceed;
(1) In the case of textile or apparel
goods, 10 percent of the adjusted value
of the set; or
(2) In the case of a good other than a
textile or apparel good, 15 percent of
the adjusted value of the set.
TARIFF PREFERENCE LEVEL
§ 10.606 Filing of claim for tariff preference level.
Apparel goods of a Party described in
§ 10.607 of this subpart that do not qualify as originating goods under § 10.594 of
this subpart may nevertheless be entitled to preferential tariff treatment
under the CAFTA–DR under an applicable tariff preference level (TPL). To
make a TPL claim, the importer must
include on the entry summary, or
equivalent documentation, the applicable subheading in Chapter 98 or 99 of
the HTSUS immediately above the applicable subheading in Chapter 61 or 62
of the HTSUS under which each nonoriginating apparel good is classified.
The applicable Chapter 98 and 99 subheadings are:
(a) Subheading 9822.05.11 or 9822.05.13
for goods described in § 10.607(a);
(b) Subheading 9915.61.01 for goods described in § 10.607(b) and (c);
(c) Subheading 9915.62.05 for goods described in § 10.607(d);
(d) Subheading 9915.62.15 for goods described in § 10.607(e); and
(e) Subheading 9915.61.03 or 9915.61.04
for goods described in § 10.607(f);
[CBP Dec. 10-26, 75 FR 50699, Aug. 17, 2010]

§ 10.607 Goods eligible for tariff preference level claims.
The following goods are eligible for a
TPL claim filed under § 10.606 of this
subpart:
(a) Cumulation for certain woven apparel goods of a Party. In accordance
with General Note 29(d)(vii), HTSUS,
for purposes of determining whether a
good of Chapter 62, HTSUS, is an originating good, materials used in the pro-

duction of the good produced in the
territory of Mexico that would have
been considered originating if produced
in the territory of a Party, will be considered as having been produced in the
territory of a Party. The applicable
product-specific and chapter rules for
Chapter 62, HTSUS, set forth in General Note 29, HTSUS, must be satisfied.
The preferential tariff treatment is
limited to the quantities specified in
U.S. Note 21(b), Subchapter XXII,
Chapter 98, HTSUS, except that the following goods made from wool fabric
are not subject to these limits: men’s
and boys’ and women’s and girls’ suits,
trousers, suit-type jackets and blazers
and vests and women’s and girls’
skirts, provided that such goods are
not made of carded wool fabric or made
from wool yarn having an average fiber
diameter of not over 18.5 microns. Subheading 9822.05.11, HTSUS, applies to
the goods described above that are subject to quantitative limits while subheading 9822.05.13, HTSUS, applies to
the goods described above that are not
subject to such limits;
(b) Cotton or man-made fiber apparel
goods of Nicaragua. Cotton or manmade fiber apparel goods described in
U.S. Note 15(b), Subchapter XV, Chapter 99, HTSUS, that are both cut (or
knit-to-shape) and sewn or otherwise
assembled in the territory of Nicaragua, and that meet the applicable
conditions for preferential tariff treatment under the CAFTA–DR, other than
the condition that they are originating
goods. The preferential tariff treatment is limited to the quantities specified in U.S. Note 15(c), Subchapter XV,
Chapter 99, HTSUS;
(c) Men’s wool sport coats of Nicaragua.
Men’s sport coats described in U.S.
Note 15(b), Subchapter XV, Chapter 99,
HTSUS, provided that the component
that determines the tariff classification of the good is of carded wool fabric
of subheading 5111.11.70, 5111.19.60, or
5111.90.90, HTSUS, the goods are both
cut (or knit-to-shape) and sewn or otherwise assembled in the territory of
Nicaragua, and the goods meet the applicable conditions for preferential tariff treatment under the CAFTA–DR,
other than the condition that they are

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U.S. Customs and Border Protection, DHS; Treasury
originating goods. The preferential tariff treatment is limited to the quantities specified in U.S. Note 15(c), Subchapter XV, Chapter 99, HTSUS;
(d) Apparel goods of Costa Rica, not
knitted or crocheted. Apparel goods described in U.S. Note 16(b), Subchapter
XV, Chapter 99, HTSUS, not knitted or
crocheted, containing 36 percent or
more by weight of wool or subject to
wool restraints, provided that the
goods are both cut and sewn or otherwise assembled in the territory of
Costa Rica, meet the applicable conditions for preferential tariff treatment
under the CAFTA–DR, other than the
condition that they are originating
goods, and comply with the requirements set forth in chapter rules 1, 3, 4,
and 5 for Chapter 62 of General Note 29,
HTSUS. The preferential tariff treatment is limited to the quantities specified in U.S. Note 16(a), Subchapter XV,
Chapter 99, HTSUS.;
(e) Apparel goods of Costa Rica made
from wool fabric. Apparel goods described in U.S. Note 16(d), Subchapter
XV, Chapter 99, HTSUS, made from
fabric of wool (except fabric of carded
wool or fabric made from wool yarn
having an average fiber diameter of
less than or equal to 18.5 microns), provided that the goods are both cut and
sewn or otherwise assembled in the territory of Costa Rica, and meet the applicable conditions for preferential tariff treatment under the CAFTA–DR,
other than the condition that they are
originating goods. The preferential tariff treatment is limited to the quantities specified in U.S. Note 16(c), Subchapter XV, Chapter 99, HTSUS; and
(f) Mastectomy swimsuits of Costa Rica.
Women’s knitted or crocheted swimwear, classified in subheading 6112.41.00
(of synthetic fibers) or 6112.49.00,
HTSUS (of other textile fibers), specially designed to accommodate postmastectomy breast prostheses, containing two full size interior pockets
with side openings, two preformed
cups, a supporting elastic band below
the breast and vertical center stitching
to separate the two pockets, provided
that the goods are both cut (or knit-toshape) and sewn or otherwise assembled in the territory of Costa Rica, and
meet the applicable conditions for preferential tariff treatment under the

§ 10.609

CAFTA–DR, other than the condition
that they are originating goods. Subheading 9915.61.03, HTSUS, applies to
the swimsuits described above classified in subheading 6112.41.00, HTSUS,
while subheading 9915.61.04, HTSUS, applies to the swimsuits described above
classified in subheading 6112.49.00,
HTSUS. The preferential tariff treatment is limited to the quantities specified in U.S. Note 17(a), Subchapter XV,
Chapter 99, HTSUS.
[CBP Dec. 10-26, 75 FR 50699, Aug. 17, 2010]

§ 10.608 Submission of certificate of
eligibility for certain apparel goods
of Nicaragua.
An importer who claims preferential
tariff treatment on a non-originating
apparel good of Nicaragua specified in
paragraphs (b) and (c) of § 10.607 of this
subpart must submit a certificate of
eligibility issued by an authorized official of the Government of Nicaragua,
demonstrating that the good is eligible
for entry under the applicable TPL.
The certificate of eligibility must be in
writing or must be transmitted electronically pursuant to any electronic
means authorized by CBP for that purpose.
[CBP Dec. 08-22, 73 FR 33678, June 13, 2008, as
amended by CBP Dec. 10-26, 75 FR 50700, Aug.
17, 2010]

§ 10.609 Transshipment of non-originating cotton or man-made fiber apparel goods.
(a) General. A good will not be considered eligible for preferential tariff
treatment under an applicable TPL by
reason of having undergone production
that would enable the good to qualify
for preferential tariff treatment if subsequent to that production the good:
(1) Undergoes production or any
other operation outside the territories
of the Parties, other than unloading,
reloading, or any other operation necessary to preserve the good in good
condition or to transport the good to
the territory of a Party; or
(2) Does not remain under the control
of customs authorities in the territory
of a non-Party.
(b) Documentary evidence. An importer making a claim for preferential
tariff treatment under an applicable
TPL may be required to demonstrate,

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§ 10.610

19 CFR Ch. I (4–1–11 Edition)

to CBP’s satisfaction, that the requirements set forth in paragraph (a) of this
section were met. An importer may
demonstrate compliance with these requirements by submitting documentary evidence. Such evidence may include, but is not limited to, bills of lading, airway bills, packing lists, commercial invoices, receiving and inventory records, and customs entry and
exit documents.
§ 10.610 Effect of noncompliance; failure to provide documentation regarding transshipment of non-originating cotton or man-made fiber apparel goods.
(a) Effect of noncompliance. If an importer of a good for which a TPL claim
is made fails to comply with any applicable requirement under this subpart,
the port director may deny preferential
tariff treatment to the imported good.
(b) Failure to provide documentation regarding transshipment. Where the requirements for preferential tariff treatment set forth elsewhere in this subpart are met, the port director nevertheless may deny preferential tariff
treatment to a good for which a TPL
claim is made if the good is shipped
through or transshipped in a country
other than a Party, and the importer of
the good does not provide, at the request of the port director, evidence
demonstrating to the satisfaction of
the port director that the requirements
set forth in § 10.609(a) of this subpart
were met.
ORIGIN VERIFICATIONS AND
DETERMINATIONS
§ 10.616 Verification and justification
of claim for preferential tariff treatment.
(a) Verification. A claim for preferential tariff treatment made under
§ 10.583(b) or § 10.591 of this subpart, including any statements or other information submitted to CBP in support of
the claim, will be subject to such
verification as the port director deems
necessary. In the event that the port
director is provided with insufficient
information to verify or substantiate
the claim, or the exporter or producer
fails to consent to a verification visit,
the port director may deny the claim
for
preferential
treatment.
A

verification of a claim for preferential
tariff treatment under CAFTA–DR for
goods imported into the United States
may be conducted by means of one or
more of the following:
(1) Written requests for information
from the importer, exporter, or producer;
(2) Written questionnaires to the importer, exporter, or producer;
(3) Visits to the premises of the exporter or producer in the territory of
the Party in which the good is produced, to review the records of the type
referred to in § 10.589(c)(1) of this subpart or to observe the facilities used in
the production of the good, in accordance with the framework that the Parties
develop
for
conducting
verifications; and
(4) Such other procedures to which
the United States and the exporting
Party may agree.
(b) Applicable accounting principles.
When conducting a verification of origin to which Generally Accepted Accounting Principles may be relevant,
CBP will apply and accept the Generally Accepted Accounting Principles
applicable in the country of production.
[CBP Dec. 08-22, 73 FR 33678, June 13, 2008, as
amended by CBP Dec. 10-26, 75 FR 50700, Aug.
17, 2010]

§ 10.617 Special rule for verifications
in a Party of U.S. imports of textile
and apparel goods.
(a) Procedures to determine whether a
claim of origin is accurate—(1) General.
For the purpose of determining that a
claim of origin for a textile or apparel
good is accurate, CBP may request
that the government of a Party conduct a verification, regardless of
whether a claim is made for preferential tariff treatment.
(2) Actions during a verification. While
a verification under this paragraph is
being conducted, CBP may take appropriate action, which may include:
(i) Suspending the application of
preferential tariff treatment to the
textile or apparel good for which a
claim for preferential tariff treatment
has been made, if CBP determines
there is insufficient information to
support the claim;

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U.S. Customs and Border Protection, DHS; Treasury
(ii) Denying the application of preferential tariff treatment to the textile
or apparel good for which a claim for
preferential tariff treatment has been
made that is the subject of a
verification if CBP determines that an
enterprise has provided incorrect information to support the claim;
(iii) Detention of any textile or apparel good exported or produced by the
enterprise subject to the verification if
CBP determines there is insufficient
information to determine the country
of origin of any such good; and
(iv) Denying entry to any textile or
apparel good exported or produced by
the
enterprise
subject
to
the
verification if CBP determines that the
enterprise has provided incorrect information as to the country of origin of
any such good.
(3) Actions following a verification. On
completion of a verification under this
paragraph, CBP may take appropriate
action, which may include:
(i) Denying the application of preferential tariff treatment to the textile
or apparel good for which a claim for
preferential tariff treatment has been
made that is the subject of a
verification if CBP determines there is
insufficient information, or that the
enterprise has provided incorrect information, to support the claim; and
(ii) Denying entry to any textile or
apparel good exported or produced by
the
enterprise
subject
to
the
verification if CBP determines there is
insufficient information to determine,
or that the enterprise has provided incorrect information as to, the country
of origin of any such good.
(b) Procedures to determine compliance
with applicable customs laws and regulations of the U.S.—(1) General. For purposes of enabling CBP to determine
that an exporter or producer is complying with applicable customs laws,
regulations, and procedures regarding
trade in textile and apparel goods, CBP
may request that the government of a
Party conduct a verification.
(2) Actions during a verification. While
a verification under this paragraph is
being conducted, CBP may take appropriate action, which may include:
(i) Suspending the application of
preferential tariff treatment to any
textile or apparel good exported or pro-

§ 10.617

duced by the enterprise subject to the
verification if CBP determines there is
insufficient information to support a
claim for preferential tariff treatment
with respect to any such good;
(ii) Denying the application of preferential tariff treatment to any textile
or apparel good exported or produced
by the enterprise subject to the
verification if CBP determines that the
enterprise has provided incorrect information to support a claim for preferential tariff treatment with respect
to any such good;
(iii) Detention of any textile or apparel good exported or produced by the
enterprise subject to the verification if
CBP determines there is insufficient
information to determine the country
of origin of any such good; and
(iv) Denying entry to any textile or
apparel good exported or produced by
the
enterprise
subject
to
the
verification if CBP determines that the
enterprise has provided incorrect information as to the country of origin of
any such good.
(3) Actions following a verification. On
completion of a verification under this
paragraph, CBP may take appropriate
action, which may include:
(i) Denying the application of preferential tariff treatment to any textile
or apparel good exported or produced
by the enterprise subject to the
verification if CBP determines there is
insufficient information, or that the
enterprise has provided incorrect information, to support a claim for preferential tariff treatment with respect
to any such good; and
(ii) Denying entry to any textile or
apparel good exported or produced by
the
enterprise
subject
to
the
verification if CBP determines there is
insufficient information to determine,
or that the enterprise has provided incorrect information as to, the country
of origin of any such good.
(c) Denial of permission to conduct a
verification. If an enterprise does not
consent to a verification under this
section, CBP may deny preferential
tariff treatment to the type of goods of
the enterprise that would have been
the subject of the verification.
(d) Assistance by U.S. officials in conducting a verification abroad. U.S. officials may undertake or assist in a

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§ 10.618

19 CFR Ch. I (4–1–11 Edition)

verification under this section by conducting visits in the territory of a
Party, along with the competent authorities of the Party, to the premises
of an exporter, producer or any other
enterprise involved in the movement of
textile or apparel goods from a Party
to the United States.
(e) Continuation of appropriate action.
CBP may continue to take appropriate
action under paragraph (a) or (b) of
this section until it receives information sufficient to enable it to make the
determination described in paragraphs
(a) and (b) of this section.
[CBP Dec. 08-22, 73 FR 33678, June 13, 2008, as
amended by CBP Dec. 10-26, 75 FR 50700, Aug.
17, 2010]

§ 10.618 Issuance of negative origin determinations.
If, as a result of an origin
verification initiated under this subpart, CBP determines that a claim for
preferential tariff treatment made
under § 10.583(b) of this subpart should
be denied, it will issue a determination
in writing or via an authorized electronic data interchange system to the
importer that sets forth the following:
(a) A description of the good that was
the subject of the verification together
with the identifying numbers and dates
of the import documents pertaining to
the good;
(b) A statement setting forth the
findings of fact made in connection
with the verification and upon which
the determination is based; and
(c) With specific reference to the
rules applicable to originating goods as
set forth in General Note 29, HTSUS,
and in §§ 10.593 through 10.605 of this
subpart, the legal basis for the determination.
§ 10.619 Repeated false or unsupported
preference claims.
Where verification or other information reveals a pattern of conduct by an
importer, exporter, or producer of false
or unsupported representations that
goods qualify under the CAFTA–DR
rules of origin set forth in General
Note 29, HTSUS, CBP may suspend
preferential tariff treatment under the
CAFTA–DR to entries of identical
goods covered by subsequent representations by that importer, exporter, or

producer until CBP determines that
representations of that person are in
conformity with General Note 29,
HTSUS.
PENALTIES
§ 10.620

General.

Except as otherwise provided in this
subpart, all criminal, civil, or administrative penalties which may be imposed on U.S. importers, exporters, and
producers for violations of the customs
and related laws and regulations will
also apply to U.S. importers, exporters,
and producers for violations of the laws
and regulations relating to the
CAFTA–DR.
§ 10.621 Corrected claim
cation by importers.

or

An importer who makes a corrected
claim under § 10.583(c) of this subpart
will not be subject to civil or administrative penalties under 19 U.S.C. 1592
for having made an incorrect claim or
having submitted an incorrect certification, provided that the corrected
claim is promptly and voluntarily
made.
§ 10.622 Corrected certification by U.S.
exporters or producers.
Civil or administrative penalties provided for under 19 U.S.C. 1592 will not
be imposed on an exporter or producer
in the United States who promptly and
voluntarily provides written notification pursuant to § 10.589(b) with respect
to the making of an incorrect certification.
§ 10.623 Framework
for
claims or certifications.

correcting

(a) ‘‘Promptly and voluntarily’’ defined.
Except as provided for in paragraph (b)
of this section, for purposes of this subpart, the making of a corrected claim
or certification by an importer or the
providing of written notification of an
incorrect certification by an exporter
or producer in the United States will
be deemed to have been done promptly
and voluntarily if:
(1)(i) Done before the commencement
of a formal investigation, within the
meaning of § 162.74(g) of this chapter; or

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U.S. Customs and Border Protection, DHS; Treasury
(ii) Done before any of the events
specified in § 162.74(i) of this chapter
have occurred; or
(iii) Done within 30 days after the importer, exporter, or producer initially
becomes aware that the claim or certification is incorrect; and
(2) Accompanied by a statement setting forth the information specified in
paragraph (c) of this section; and
(3) In the case of a corrected claim or
certification by an importer, accompanied or followed by a tender of any
actual loss of duties and merchandise
processing fees, if applicable, in accordance with paragraph (d) of this section.
(b) Exception in cases involving fraud
or subsequent incorrect claims—(1) Fraud.
Notwithstanding paragraph (a) of this
section, a person who acted fraudulently in making an incorrect claim or
certification may not make a voluntary correction of that claim or certification. For purposes of this paragraph, the term ‘‘fraud’’ will have the
meaning set forth in paragraph (C)(3) of
appendix B to part 171 of this chapter.
(2) Subsequent incorrect claims. An importer who makes one or more incorrect claims after becoming aware that
a claim involving the same merchandise and circumstances is invalid may
not make a voluntary correction of the
subsequent claims pursuant to paragraph (a) of this section.
(c) Statement. For purposes of this
subpart, each corrected claim or certification must be accompanied by a
statement, submitted in writing or via
an authorized electronic data interchange system, which:
(1) Identifies the class or kind of good
to which the incorrect claim or certification relates;
(2) In the case of a corrected claim or
certification by an importer, identifies
each affected import transaction, including each port of importation and
the approximate date of each importation;
(3) Specifies the nature of the incorrect statements or omissions regarding
the claim or certification; and
(4) Sets forth, to the best of the person’s knowledge, the true and accurate
information or data which should have
been covered by or provided in the
claim or certification, and states that
the person will provide any additional

§ 10.624

information or data which are unknown at the time of making the corrected claim or certification within 30
days or within any extension of that 30day period as CBP may permit in order
for the person to obtain the information or data.
(d) Tender of actual loss of duties. A
U.S. importer who makes a corrected
claim must tender any actual loss of
duties at the time of making the corrected claim, or within 30 days thereafter, or within any extension of that
30-day period as CBP may allow in
order for the importer to obtain the information or data necessary to calculate the duties owed.
GOODS RETURNED AFTER REPAIR OR
ALTERATION
§ 10.624 Goods re-entered after repair
or alteration in a Party.
(a) General. This section sets forth
the rules which apply for purposes of
obtaining duty-free treatment on goods
returned after repair or alteration in a
Party as provided for in subheadings
9802.00.40 and 9802.00.50, HTSUS. Goods
returned after having been repaired or
altered in a Party, whether or not pursuant to a warranty, are eligible for
duty-free treatment, provided that the
requirements of this section are met.
For purposes of this section, ‘‘repairs or
alterations’’ means restoration, addition, renovation, re-dyeing, cleaning,
re-sterilizing, or other treatment that
does not destroy the essential characteristics of, or create a new or commercially different good from, the good exported from the United States.
(b) Goods not eligible for duty-free
treatment after repair or alteration. The
duty-free treatment referred to in
paragraph (a) of this section will not
apply to goods which, in their condition as exported from the United
States to a Party, are incomplete for
their intended use and for which the
processing operation performed in the
Party constitutes an operation that is
performed as a matter of course in the
preparation or manufacture of finished
goods.
(c) Documentation. The provisions of
paragraphs (a), (b), and (c) of § 10.8 of
this part, relating to the documentary
requirements for goods entered under

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§ 10.625

19 CFR Ch. I (4–1–11 Edition)

subheading 9802.00.40 or 9802.00.50,
HTSUS, will apply in connection with
the entry of goods which are returned
from a Party after having been exported for repairs or alterations and
which are claimed to be duty free.
RETROACTIVE PREFERENTIAL TARIFF
TREATMENT FOR TEXTILE AND APPAREL GOODS
§ 10.625 Refunds of excess customs duties.
(a) Applicability. Section 205 of the
Dominican Republic—Central America—United States Free Trade Agreement Implementation Act, as amended
by section 1634(d) of the Pension Protection Act of 2006, provides for the retroactive application of the Agreement
and payment of refunds for any excess
duties paid with respect to entries of
textile and apparel goods of eligible
CAFTA–DR countries that meet certain conditions and requirements.
Those conditions and requirements are
set forth in paragraphs (b) and (c) of
this section.
(b)
General.
Notwithstanding
19
U.S.C. 1514 or any other provision of
law, and subject to paragraph (c) of
this section, a textile or apparel good
of an eligible CAFTA–DR country that
was entered or withdrawn from warehouse for consumption on or after January 1, 2004, and before January 1, 2009,
will be liquidated or reliquidated at the
applicable rate of duty for that good
set out in the Schedule of the United
States to Annex 3.3 of the Agreement,
and CBP will refund any excess customs duties paid with respect to such
entry, with interest accrued from the
date of entry, provided:
(1) The good would have qualified as
an originating good under section 203
of the Act if the good had been entered
after the date of entry into force of the
Agreement for that country; and
(2) Customs duties in excess of the
applicable rate of duty for that good
set out in the Schedule of the United
States to Annex 3.3 of the Agreement
were paid.
(c) Request for liquidation or reliquidation. Liquidation or reliquidation may
be made under paragraph (b) of this
section with respect to an entry of a
textile or apparel good of an eligible

CAFTA–DR country only if a request
for liquidation or reliquidation is filed
with the CBP port where the entry was
originally filed by April 1, 2009, and the
request contains sufficient information
to enable CBP:
(1) To locate the entry or to reconstruct the entry if it cannot be located;
and
(2) To determine that the good satisfies the conditions set forth in paragraph (b) of this section.
(d) Eligible CAFTA–DR country defined. For purposes of this section, the
term ‘‘eligible CAFTA–DR country’’
means a country that the United
States Trade Representative has determined, by notice published in the FEDERAL REGISTER, to be an eligible country for purposes of section 205 of the
Act.
[CBP Dec. 08-22, 73 FR 33678, June 13, 2008, as
amended by CBP Dec. 10-26, 75 FR 50700, Aug.
17, 2010]

Subpart K—United States-Jordan
Free Trade Agreement
SOURCE: CBP Dec. 07–50, 72 FR 35156, June
27, 2007, unless otherwise noted.

GENERAL PROVISIONS
§ 10.701 Scope.
This subpart implements the duty
preference and related customs provisions applicable to imported goods
under the United States-Jordan Free
Trade Agreement (the US–JFTA)
signed on October 24, 2000, and under
the United States-Jordan Free Trade
Area Implementation Act (the Act; 115
Stat. 243). Except as otherwise specified in this subpart, the procedures and
other requirements set forth in this
subpart are in addition to the customs
procedures and requirements of general
application contained elsewhere in this
chapter. Additional provisions implementing certain aspects of the US–
JFTA are contained in part 163 of this
chapter.
§ 10.702 Definitions.
The following definitions apply for
purposes of §§ 10.701 through 10.712:
(a) Claim for preferential tariff treatment. ‘‘Claim for preferential tariff
treatment’’ means a claim that a good

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U.S. Customs and Border Protection, DHS; Treasury
is entitled to the duty rate applicable
under the US–JFTA;
(b) Customs authority. ‘‘Customs authority’’ means the competent authority that is responsible under the law of
a country for the administration of
customs laws and regulations;
(c) Customs territory of the United
States. ‘‘Customs territory of the United
States’’ means the 50 states, the District of Columbia, and Puerto Rico;
(d) Days. ‘‘Days’’ means calendar days
unless otherwise specified;
(e) Entered. ‘‘Entered’’ means entered,
or withdrawn from warehouse for consumption, in the customs territory of
the United States;
(f) Good. ‘‘Good’’ means any merchandise, product, article, or material;
(g) Harmonized System. ‘‘Harmonized
System’’ means the Harmonized Commodity Description and Coding System,
including its General Rules of Interpretation, Section Notes, and Chapter
Notes, as adopted and implemented by
the Parties in their respective tariff
laws;
(h) Heading. ‘‘Heading’’ means the
first four digits in the tariff classification number under the Harmonized
System;
(i) HTSUS. ‘‘HTSUS’’ means the Harmonized Tariff Schedule of the United
States as promulgated by the U.S.
International Trade Commission;
(j) Material. ‘‘Material’’ means a good
that is used in the production of another good;
(k) New or different article of commerce.
‘‘New or different article of commerce’’
means a good that has been substantially transformed into a new and different article of commerce having a
new name, character, or use distinct
from the good or material from which
it was so transformed;
(l) Party. ‘‘Party’’ means the United
States or the Hashemite Kingdom of
Jordan;
(m)
Preferential
tariff
treatment.
‘‘Preferential tariff treatment’’ means
the duty rate applicable under the US–
JFTA;
(n) Subheading. ‘‘Subheading’’ means
the first six digits in the tariff classification number under the Harmonized
System;
(o) Territory. ‘‘Territory’’ means:

§ 10.703

(1) With respect to Jordan, the land,
maritime and air space under its sovereignty, and the exclusive economic
zone within which it exercises sovereign rights and jurisdiction in accordance with international law and its
domestic law; and
(2) With respect to the United States,
(i) The customs territory of the
United States, which includes the 50
states, the District of Columbia, and
Puerto Rico,
(ii) The foreign trade zones located in
the United States and Puerto Rico, and
(iii) Any areas beyond the territorial
seas of the United States within which,
in accordance with international law
and its domestic law, the United States
may exercise rights with respect to the
seabed and subsoil and their natural resources;
(p) Textile or apparel good. ‘‘Textile or
apparel good’’ means a good listed in
the Annex to the Agreement on Textiles and Clothing (commonly referred
to as ‘‘the ATC’’), which is part of the
WTO Agreement;
(q) WTO Agreement. ‘‘WTO Agreement’’ means the Marrakesh Agreement
Establishing the World Trade Organization of April 15, 1994;
(r) Wholly the growth, product, or manufacture of Jordan. ‘‘Wholly the growth,
product, or manufacture of Jordan’’ refers both to any good which has been
entirely grown, produced, or manufactured in Jordan and to all materials incorporated in a good which have been
entirely grown, produced, or manufactured in Jordan, as distinguished from
goods or materials imported into Jordan from another country, whether or
not such goods or materials were substantially transformed into new or different articles of commerce after their
importation into Jordan.
IMPORT REQUIREMENTS
§ 10.703 Filing of claim for preferential
tariff treatment.
An importer may make a claim for
US–JFTA preferential tariff treatment
by including on the entry summary, or
equivalent documentation, the symbol
‘‘JO’’ as a prefix to the subheading of
the HTSUS under which each qualifying good is classified, or by the method specified for equivalent reporting

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§ 10.704

19 CFR Ch. I (4–1–11 Edition)

via an authorized electronic data interchange system.
§ 10.704

Declaration.

(a) Contents. An importer who claims
preferential tariff treatment for a good
under the US–JFTA must submit, at
the request of the port director, a declaration setting forth all pertinent information concerning the production
or manufacture of the good. A declaration submitted to CBP under this paragraph:
(1) Need not be in a prescribed format
but must be in writing or must be
transmitted electronically pursuant to
any electronic means authorized by
CBP for that purpose;
(2) Must include the following information:
(i) The legal name, address, telephone, and e-mail address (if any) of
the importer of record of the good;
(ii) The legal name, address, telephone, and e-mail address (if any) of
the responsible official or authorized
agent of the importer signing the declaration (if different from the information required by paragraph (a)(2)(i) of
this section);
(iii) The legal name, address, telephone and e-mail address (if any) of the
exporter of the good (if different from
the producer);
(iv) The legal name, address, telephone and e-mail address (if any) of the
producer of the good (if known);
(v) A description of the good, quantity, numbers, and marks of packages,
invoice numbers, and bills of lading;
(vi) A description of the operations
performed in the production of the
good in Jordan and identification of
the direct costs of processing operations;
(vii) A description of any materials
used in the production of the good that
are wholly the growth, product, or
manufacture of Jordan or the United
States, and a statement as to the cost
or value of such materials;
(viii) A description of the operations
performed on, and a statement as to
the origin and cost or value of, any foreign materials used in the good that
are claimed to have been sufficiently
processed in Jordan so as to be materials produced in Jordan; and

(ix) A description of the origin and
cost or value of any foreign materials
used in the good that have not been
substantially transformed in Jordan.
(3) Must include a statement, in substantially the following form:
‘‘I certify that:
The information on this document is true
and accurate and I assume the responsibility
for proving such representations. I understand that I am liable for any false statements or material omissions made on or in
connection with this document;
I agree to maintain, and present upon request, documentation necessary to support
these representations;
The goods comply with all the requirements for preferential tariff treatment specified for those goods in the United States-Jordan Free Trade Agreement; and
This document consists of ll pages, including all attachments.’’

(b) Responsible official or agent. The
declaration must be signed and dated
by a responsible official of the importer or by the importer’s authorized
agent having knowledge of the relevant
facts.
(c) Language. The declaration must
be completed in the English language.
(d) Applicability of declaration. The
declaration may be applicable to:
(1) A single importation of a good
into the United States, including a single shipment that results in the filing
of one or more entries and a series of
shipments that results in the filing of
one entry; or
(2) Multiple importations of identical
goods into the United States that
occur within a specified blanket period,
not exceeding 12 months, set out in the
declaration. For purposes of this paragraph, ‘‘identical goods’’ means goods
that are the same in all respects relevant to the production that qualifies
the goods for preferential tariff treatment.
§ 10.705

Importer obligations.

(a) General. An importer who makes a
claim for preferential tariff treatment
under § 10.703 of this subpart:
(1) Will be deemed to have certified
that the good is eligible for preferential tariff treatment under the US–
JFTA:
(2) Is responsible for the truthfulness
of the information and data contained

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U.S. Customs and Border Protection, DHS; Treasury
in the declaration provided for in
§ 10.704 of this subpart;
(3) Is responsible for submitting any
supporting documents requested by
CBP and for the truthfulness of the information contained in those documents. CBP will allow for the direct
submission by the exporter or producer
of business confidential or other sensitive information, including cost and
sourcing information.
(b) Information provided by exporter or
producer. The fact that the importer
has made a claim for preferential tariff
treatment or prepared a declaration
based on information provided by an
exporter or producer will not relieve
the importer of the responsibility referred to in paragraph (a) of this section.
§ 10.706

Declaration not required.

(a) General. Except as otherwise provided in paragraph (b) of this section,
an importer will not be required to submit a declaration under § 10.704 of this
subpart for:
(1) A non-commercial importation of
a good; or
(2) A commercial importation for
which the value of the goods does not
exceed U.S. $2,500.
(b) Exception. If the port director determines that an importation described
in paragraph (a) of this section may
reasonably be considered to have been
carried out or planned for the purpose
of evading compliance with the rules
and procedures governing claims for
preference under the US–JFTA, the
port director will notify the importer
that for that importation the importer
must submit to CBP a declaration. The
importer must submit such a declaration within 30 days from the date of the
notice. Failure to timely submit the
declaration will result in denial of the
claim for preferential tariff treatment.
§ 10.707

Maintenance of records.

(a) General. An importer claiming
preferential tariff treatment for a good
under § 10.703 of this subpart must
maintain, for five years after the date
of the claim for preferential tariff
treatment, all records and documents
necessary for the preparation of the
declaration.

§ 10.709

(b) Applicability of other recordkeeping
requirements. The records and documents referred to in paragraph (a) of
this section are in addition to any
other records required to be made,
kept, and made available to CBP under
part 163 of this chapter.
(c) Method of maintenance. The
records and documents referred to in
paragraph (a) of this section must be
maintained by importers as provided in
§ 163.5 of this chapter.
§ 10.708 Effect of noncompliance; failure to provide documentation regarding third-country transportation.
(a) Effect of noncompliance. If the importer fails to comply with any requirement under this subpart, including submission of a complete declaration under § 10.704 of this subpart, when
requested, the port director may deny
preferential tariff treatment to the imported good.
(b) Failure to provide documentation regarding third country transportation.
Where the requirements for preferential tariff treatment set forth elsewhere in this subpart are met, the port
director nevertheless may deny preferential treatment to a good if the
good is shipped through or transshipped in a country other than Jordan
or the United States, and the importer
of the good does not provide, at the request of the port director, evidence
demonstrating to the satisfaction of
the port director that the good was
‘‘imported directly’’, as that term is defined in § 10.711(a) of this subpart.
RULES OF ORIGIN
§ 10.709 Country of origin criteria.
(a) General. Except as otherwise provided in paragraph (b) of this section, a
good imported directly from Jordan
into the customs territory of the
United States will be eligible for preferential tariff treatment under the US–
JFTA only if:
(1) The good is either:
(i) Wholly the growth, product, or
manufacture of Jordan; or
(ii) A new or different article of commerce that has been grown, produced,
or manufactured in Jordan; and
(2) With respect to a good described
in paragraph (a)(1)(ii) of this section,

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§ 10.710

19 CFR Ch. I (4–1–11 Edition)

the good satisfies the value-content requirement specified in § 10.710 of this
subpart.
(b) Exceptions—(1) Combining, packaging, and diluting operations. No good
will be considered to meet the requirements of paragraph (a)(1) of this section by virtue of having merely undergone simple combining or packaging
operations, or mere dilution with water
or mere dilution with another substance that does not materially alter
the characteristics of the good. The
principles and examples set forth in
§ 10.195(a)(2) of this part will apply
equally for purposes of this paragraph.
(2) Certain juices. A good will not be
considered to meet the requirements of
paragraph (a)(1) of this section if the
good:
(i) Is imported into Jordan, and, at
the time of importation, would be classified in heading 0805, HTSUS; and
(ii) Is processed in Jordan into a good
classified in any of subheadings 2009.11
through 2009.30, HTSUS.
(c) Textile and apparel goods. For purposes of determining whether a textile
or apparel good meets the requirements of paragraph (a)(1) of this section, the provisions of § 102.21 of this
chapter will apply.
§ 10.710

Value-content requirement.

(a) General. A good described in
§ 10.709(a)(1)(ii) may be eligible for preferential tariff treatment under the US–
JFTA only if the sum of the cost or
value of the materials produced in Jordan, plus the direct costs of processing
operations performed in Jordan, is not
less than 35 percent of the appraised
value of the good at the time it is entered.
(b) Materials produced in the United
States. For purposes of determining the
percentage referred to paragraph (a) of
this section, an amount not to exceed
15 percent of the appraised value of the
good at the time it is entered may be
attributed to the cost or value of materials produced in the customs territory
of the United States. A material is
‘‘produced in the customs territory of
the United States’’ for purposes of this
paragraph if it is either:
(1) Wholly the growth, product, or
manufacture of the United States; or

(2) Subject to the exceptions specified in § 10.709(b) of this subpart, substantially transformed in the United
States into a new and different article
of commerce that has a new name,
character, or use, which is then used in
Jordan in the production or manufacture of a new or different article of
commerce that is imported into the
United States. Except where the context otherwise requires, the examples
set forth in § 10.196(a) of this part will
apply for purposes of this paragraph.
(c) Cost or value of materials—(1) Materials produced in Jordan defined. For
purposes of paragraph (a) of this section, the words ‘‘materials produced in
Jordan’’ refer to those materials incorporated into a good that are either:
(i) Wholly the growth, product, or
manufacture of Jordan; or
(ii) Subject to the exceptions specified in § 10.709(b) of this subpart, substantially transformed in Jordan into a
new and different article of commerce
that has a new name, character, or use,
which is then used in Jordan in the
production or manufacture of a new or
different article of commerce that is
imported into the United States. Except where the context otherwise requires, the examples set forth in
§ 10.196(a) of this part will apply for
purposes of this paragraph.
(2) Determination of cost or value of
materials. (i) Except as provided in
paragraph (c)(2)(ii) of this section, the
cost or value of materials produced in
Jordan or in the United States includes:
(A) The manufacturer’s actual cost
for the materials;
(B) When not included in the manufacturer’s actual cost for the materials,
the freight, insurance, packing, and all
other costs incurred in transporting
the materials to the manufacturer’s
plant;
(C) The actual cost of waste or spoilage, less the value of recoverable scrap;
and
(D) Taxes and/or duties imposed on
the materials by a Party, provided
they are not remitted upon exportation.
(ii) Where a material is provided to
the manufacturer without charge, or at
less than fair market value, its cost or

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U.S. Customs and Border Protection, DHS; Treasury
value will be determined by computing
the sum of:
(A) All expenses incurred in the
growth, production, or manufacture of
the material, including general expenses;
(B) An amount for profit; and
(C) Freight, insurance, packing, and
all other costs incurred in transporting
the material to the manufacturer’s
plant.
(iii) If the pertinent information
needed to compute the cost or value of
a material is not available, the port director may ascertain or estimate the
value thereof using all reasonable ways
and means at his or her disposal.
(d) Direct costs of processing operations—(1) Items included. For purposes
of paragraph (a) of this section, the
words ‘‘direct costs of processing operations’’ mean those costs either directly incurred in, or which can be reasonably allocated to, the growth, production, manufacture, or assembly of
the specific goods under consideration.
Such costs include, but are not limited
to the following, to the extent that
they are includable in the appraised
value of the imported goods:
(i) All actual labor costs involved in
the growth, production, manufacture,
or assembly of the specific goods, including fringe benefits, on-the-job
training, and the cost of engineering,
supervisory, quality control, and similar personnel;
(ii) Dies, molds, tooling, and depreciation on machinery and equipment
which are allocable to the specific
goods;
(iii) Research, development, design,
engineering, and blueprint costs insofar as they are allocable to the specific
goods; and
(iv) Costs of inspecting and testing
the specific goods.
(2) Items not included. For purposes of
paragraph (a) of this section, the words
‘‘direct costs of processing operations’’
do not include items that are not directly attributable to the goods under
consideration or are not costs of manufacturing the product. These include,
but are not limited to:
(i) Profit; and
(ii) General expenses of doing business that either are not allocable to
the specific goods or are not related to

§ 10.711

the growth, production, manufacture,
or assembly of the goods, such as administrative salaries, casualty and liability insurance, advertising, and
salesmen’s salaries, commissions, or
expenses.
§ 10.711 Imported directly.
(a) General. To be eligible for preferential tariff treatment under the US–
JFTA, a good must be imported directly from Jordan into the customs
territory of the United States. For purposes of this requirement, the words
‘‘imported directly’’ mean:
(1) Direct shipment from Jordan to
the United States without passing
through the territory of any intermediate country;
(2) If shipment is from Jordan to the
United States through the territory of
an intermediate country, the goods in
the shipment do not enter into the
commerce of the intermediate country
and the invoices, bills of lading, and
other shipping documents show the
United States as the final destination;
or
(3) If shipment is through an intermediate country and the invoices and
other documents do not show the
United States as the final destination,
the goods in the shipment are imported
directly only if they:
(i) Remained under the control of the
customs authority in the intermediate
country;
(ii) Did not enter into the commerce
of the intermediate country except for
the purpose of a sale other than at retail, provided that the goods are imported as a result of the original commercial transaction between the importer and the producer or the producer’s sales agent; and
(iii) Have not been subjected to operations other than loading and unloading, and other activities necessary to
preserve the goods in good condition.
(b) Documentary evidence. An importer making a claim for preferential
tariff treatment under the US–JFTA
may be required to demonstrate, to
CBP’s satisfaction, that the goods were
‘‘imported directly’’ as that term is defined in paragraph (a) of this section.
An importer may demonstrate compliance with this section by submitting
documentary evidence. Such evidence

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§ 10.712

19 CFR Ch. I (4–1–11 Edition)

may include, but is not limited to, bills
of lading, airway bills, packing lists,
commercial invoices, receiving and inventory records, and customs entry
and exit documents.
ORIGIN VERIFICATIONS
§ 10.712 Verification of claim for preferential tariff treatment.
A claim for preferential tariff treatment made under § 10.703 of this subpart, including any statements or
other information submitted to CBP in
support of the claim, will be subject to
such verification as the port director
deems necessary. In the event that the
port director for any reason is prevented from verifying the claim, or is
provided with insufficient information
to verify or substantiate the claim, the
port director may deny the claim for
preferential tariff treatment.

Subpart L [Reserved]
Subpart M—United StatesMorocco Free Trade Agreement
SOURCE: CBP Dec. 07–51, 72 FR 35651, June
29, 2007, unless otherwise noted.

GENERAL PROVISIONS
§ 10.761

Scope.

This subpart implements the duty
preference and related customs provisions applicable to imported goods
under the United States-Morocco Free
Trade Agreement (the MFTA) signed
on June 15, 2004, and under the United
States-Morocco Free Trade Agreement
Implementation Act (the Act; 118 Stat.
1103). Except as otherwise specified in
this subpart, the procedures and other
requirements set forth in this subpart
are in addition to the customs procedures and requirements of general application contained elsewhere in this
chapter. Additional provisions implementing certain aspects of the MFTA
and the Act are contained in Parts 102,
162, and 163 of this chapter.
CBP Dec. 07–51, 72 FR 35651, June 29, 2007, as
amended at CBP Dec. 08–29, 73 FR 45354, Aug.
5, 2008]

§ 10.762 General definitions.
As used in this subpart, the following
terms will have the meanings indicated
unless either the context in which they
are used requires a different meaning
or a different definition is prescribed
for a particular section of this subpart:
(a) Claim of origin. ‘‘Claim of origin’’
means a claim that a good is an originating good;
(b) Claim for preferential tariff treatment. ‘‘Claim for preferential tariff
treatment’’ means a claim that a good
is entitled to the duty rate applicable
under the MFTA to an originating
good;
(c) Customs Valuation Agreement.
‘‘Customs Valuation Agreement’’ means
the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994, which is part of the
WTO Agreement;
(d) Customs duty. ‘‘Customs duty’’ includes any customs or import duty and
a charge of any kind imposed in connection with the importation of a good,
including any form of surtax or surcharge in connection with such importation, but does not include any:
(1) Charge equivalent to an internal
tax imposed consistently with Article
III:2 of the GATT 1994 in respect of
like, directly competitive, or substitutable goods of the Party or in respect of
goods from which the imported good
has been manufactured or produced in
whole or in part;
(2) Antidumping or countervailing
duty; and
(3) Fee or other charge in connection
with importation commensurate with
the cost of services rendered;
(e) Days. ‘‘Days’’ means calendar days.
(f) Enterprise. ‘‘Enterprise’’ means any
entity constituted or organized under
applicable law, whether or not for profit, and whether privately-owned or governmentally-owned, including any corporation, trust, partnership, sole proprietorship, joint venture, or other association;
(g) Foreign material. ‘‘Foreign material’’ means a material other than a
material produced in the territory of
one or both of the Parties;
(h) GATT 1994. ‘‘GATT 1994’’ means the
General Agreement on Tariffs and
Trade 1994, which is part of the WTO
Agreement;

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U.S. Customs and Border Protection, DHS; Treasury
(i) Good. ‘‘Good’’ means any merchandise, product, article, or material;
(j) Harmonized System. ‘‘Harmonized
System (HS)’’ means the Harmonized
Commodity Description and Coding System, including its General Rules of Interpretation, Section Notes, and Chapter Notes, as adopted and implemented
by the Parties in their respective tariff
laws;
(k) Heading. ‘‘Heading’’ means the
first four digits in the tariff classification number under the Harmonized
System;
(l) HTSUS. ‘‘HTSUS’’ means the Harmonized Tariff Schedule of the United
States as promulgated by the U.S.
International Trade Commission;
(m) Originating. ‘‘Originating’’ means
a good qualifying under the rules of origin set forth in General Note 27,
HTSUS, and MFTA Chapter Four (Textiles and apparel) or Chapter Five
(Rules of Origin);
(n) Party. ‘‘Party’’ means the United
States or the Kingdom of Morocco;
(o) Person. ‘‘Person’’ means a natural
person or an enterprise;
(p) Preferential tariff treatment. ‘‘Preferential tariff treatment’’ means the
duty rate applicable under the MFTA
to an originating good;
(q) Subheading. ‘‘Subheading’’ means
the first six digits in the tariff classification number under the Harmonized
System;
(r) Textile or apparel good. ‘‘Textile or
apparel good’’ means a good listed in
the Annex to the Agreement on Textiles and Clothing (commonly referred
to as ATC), which is part of the WTO
Agreement;
(s) Territory. ‘‘Territory’’ means:
(1) With respect to Morocco, the land,
maritime and air space under its sovereignty, and the exclusive economic
zone and the continental shelf within
which it exercises sovereign rights and
jurisdiction in accordance with international law and its domestic law; and
(2) With respect to the United States,
(i) The customs territory of the
United States, which includes the 50
states, the District of Columbia, and
Puerto Rico,
(ii) The foreign trade zones located in
the United States and Puerto Rico, and
(iii) Any areas beyond the territorial
seas of the United States within which,

§ 10.764

in accordance with international law
and its domestic law, the United States
may exercise rights with respect to the
seabed and subsoil and their natural resources;
(t) WTO Agreement. ‘‘WTO Agreement’’
means the Marrakesh Agreement Establishing the World Trade Organization of
April 15, 1994.
IMPORT REQUIREMENTS
§ 10.763 Filing of claim for preferential
tariff treatment upon importation.
An importer may make a claim for
MFTA preferential tariff treatment for
an originating good by including on the
entry summary, or equivalent documentation, the symbol ‘‘MA’’ as a prefix
to the subheading of the HTSUS under
which each qualifying good is classified, or by the method specified for
equivalent reporting via an authorized
electronic data interchange system.
§ 10.764

Declaration.

(a) Contents. An importer who claims
preferential tariff treatment for a good
under the MFTA must submit to CBP,
at the request of the port director, a
declaration setting forth all pertinent
information concerning the growth,
production, or manufacture of the
good. A declaration submitted to CBP
under this paragraph:
(1) Need not be in a prescribed format
but must be in writing or must be
transmitted electronically pursuant to
any electronic means authorized by
CBP for that purpose;
(2) Must include the following information:
(i) The legal name, address, telephone, and e-mail address (if any) of
the importer of record of the good;
(ii) The legal name, address, telephone, and e-mail address (if any) of
the responsible official or authorized
agent of the importer signing the declaration (if different from the information required by paragraph (a)(2)(i) of
this section);
(iii) The legal name, address, telephone, and e-mail address (if any) of
the exporter of the good (if different
from the producer);
(iv) The legal name, address, telephone, and e-mail address (if any) of
the producer of the good (if known);

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§ 10.765

19 CFR Ch. I (4–1–11 Edition)

(v) A description of the good, which
must be sufficiently detailed to relate
it to the invoice and HS nomenclature,
including quantity, numbers, invoice
numbers, and bills of lading;
(vi) A description of the operations
performed in the growth, production,
or manufacture of the good in the territory of one or both of the Parties
and, where applicable, identification of
the direct costs of processing operations;
(vii) A description of any materials
used in the growth, production, or
manufacture of the good that are wholly the growth, product, or manufacture
of one or both of the Parties, and a
statement as to the value of such materials;
(viii) A description of the operations
performed on, and a statement as to
the origin and value of, any materials
used in the article that are claimed to
have been sufficiently processed in the
territory of one or both of the Parties
so as to be materials produced in one
or both of the Parties, or are claimed
to have undergone an applicable
change in tariff classification specified
in General Note 27(h), HTSUS; and
(ix) A description of the origin and
value of any foreign materials used in
the good that have not been substantially transformed in the territory of
one or both of the Parties, or have not
undergone an applicable change in tariff classification specified in General
Note 27(h), HTSUS;
(3) Must include a statement, in substantially the following form:
‘‘I certify that:
The information on this document is true
and accurate and I assume the responsibility
for proving such representations. I understand that I am liable for any false statements or material omissions made on or in
connection with this document;
I agree to maintain and present upon request, documentation necessary to support
these representations;
The goods comply with all the requirements for preferential tariff treatment specified for those goods in the United States-Morocco Free Trade Agreement; and
This document consists of llpages, including all attachments.’’

(b) Responsible official or agent. The
declaration must be signed and dated
by a responsible official of the importer or by the importer’s authorized

agent having knowledge of the relevant
facts.
(c) Language. The declaration must
be completed in the English language.
(d) Applicability of declaration. The
declaration may be applicable to:
(1) A single importation of a good
into the United States, including a single shipment that results in the filing
of one or more entries and a series of
shipments that results in the filing of
one entry; or
(2) Multiple importations of identical
goods into the United States that
occur within a specified blanket period,
not exceeding 12 months, set out in the
declaration. For purposes of this paragraph, ‘‘identical goods’’ means goods
that are the same in all respects relevant to the production that qualifies
the goods for preferential tariff treatment.
§ 10.765

Importer obligations.

(a) General. An importer who makes a
claim for preferential tariff treatment
under § 10.763 of this subpart:
(1) Will be deemed to have certified
that the good is eligible for preferential tariff treatment under the
MFTA;
(2) Is responsible for the truthfulness
of the information and data contained
in the declaration provided for in
§ 10.764 of this subpart; and
(3) Is responsible for submitting any
supporting documents requested by
CBP and for the truthfulness of the information contained in those documents. CBP will allow for the direct
submission by the exporter or producer
of business confidential or other sensitive information, including cost and
sourcing information.
(b) Information provided by exporter or
producer. The fact that the importer
has made a claim for preferential tariff
treatment or prepared a declaration
based on information provided by an
exporter or producer will not relieve
the importer of the responsibility referred to in paragraph (a) of this section.
§ 10.766

Declaration not required.

(a) General. Except as otherwise provided in paragraph (b) of this section,

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U.S. Customs and Border Protection, DHS; Treasury
an importer will not be required to submit a declaration under § 10.764 of this
subpart for:
(1) A non-commercial importation of
a good; or
(2) A commercial importation for
which the value of the originating
goods does not exceed U.S. $2,500.
(b) Exception. If the port director determines that an importation described
in paragraph (a) of this section may
reasonably be considered to have been
carried out or planned for the purpose
of evading compliance with the rules
and procedures governing claims for
preference under the MFTA, the port
director will notify the importer that
for that importation the importer must
submit to CBP a declaration. The importer must submit such a declaration
within 30 days from the date of the notice. Failure to timely submit the declaration will result in denial of the
claim for preferential tariff treatment.
§ 10.767 Maintenance of records.
(a) General. An importer claiming
preferential tariff treatment for a good
under § 10.763 of this subpart must
maintain, for five years after the date
of the claim for preferential tariff
treatment, all records and documents
necessary for the preparation of the
declaration.
(b) Applicability of other recordkeeping
requirements. The records and documents referred to in paragraph (a) of
this section are in addition to any
other records required to be made,
kept, and made available to CBP under
part 163 of this chapter.
(c) Method of maintenance. The
records and documents referred to in
paragraph (a) of this section must be
maintained by importers as provided in
§ 163.5 of this chapter.
§ 10.768 Effect of noncompliance; failure to provide documentation regarding transshipment.
(a) General. If the importer fails to
comply with any requirement under
this subpart, including submission of a
complete declaration under § 10.764 of
this subpart, when requested, the port
director may deny preferential tariff
treatment to the imported good.
(b) Failure to provide documentation regarding transshipment. Where the re-

§ 10.769

quirements for preferential tariff treatment set forth elsewhere in this subpart are met, the port director nevertheless may deny preferential treatment to a good if the good is shipped
through or transshipped in the territory of a country other than a Party,
and the importer of the good does not
provide, at the request of the port director, evidence demonstrating to the
satisfaction of the port director that
the good was imported directly from
the territory of a Party into the territory of the other Party (see § 10.777 of
this subpart).
RULES OF ORIGIN
§ 10.769

Definitions.

For purposes of §§ 10.769 through
10.777:
(a) Exporter. ‘‘Exporter’’ means a person who exports goods from the territory of a Party;
(b) Generally Accepted Accounting
Principles. ‘‘Generally Accepted Accounting Principles’’ means the recognized consensus or substantial authoritative support in the territory of a
Party, with respect to the recording of
revenues, expenses, costs, assets, and
liabilities, the disclosure of information, and the preparation of financial
statements. These standards may encompass broad guidelines of general application as well as detailed standards,
practices, and procedures;
(c) Good. ‘‘Good’’ means any merchandise, product, article, or material;
(d) Goods wholly the growth, product,
or manufacture of one or both of the Parties. ‘‘Goods wholly the growth, product, or manufacture of one or both of
the Parties’’ means:
(1) Mineral goods extracted in the
territory of one or both of the Parties;
(2) Vegetable goods, as such goods are
defined in the HTSUS, harvested in the
territory of one or both of the Parties;
(3) Live animals born and raised in
the territory of one or both of the Parties;
(4) Goods obtained from live animals
raised in the territory of one or both of
the Parties;
(5) Goods obtained from hunting,
trapping, or fishing in the territory of
one or both of the parties;

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§ 10.769

19 CFR Ch. I (4–1–11 Edition)

(6) Goods (fish, shellfish, and other
marine life) taken from the sea by vessels registered or recorded with a Party
and flying its flag;
(7) Goods produced from goods referred to in paragraph (d)(5) on board
factory ships registered or recorded
with that Party and flying its flag;
(8) Goods taken by a Party or a person of a Party from the seabed or beneath the seabed outside territorial
waters, provided that a Party has
rights to exploit such seabed;
(9) Goods taken from outer space,
provided they are obtained by a Party
or a person of a Party and not processed in the territory of a non-Party;
(10) Waste and scrap derived from:
(i) Production or manufacture in the
territory of one or both of the Parties,
or
(ii) Used goods collected in the territory of one or both of the Parties, provided such goods are fit only for the recovery of raw materials;
(11) Recovered goods derived in the
territory of a Party from used goods,
and utilized in the territory of that
Party in the production of remanufactured goods; and
(12) Goods produced in the territory
of one or both of the Parties exclusively from goods referred to in paragraphs (d)(1) through (d)(10) of this section, or from their derivatives, at any
stage of production;
(e) Importer. Importer means a person
who imports goods into the territory of
a Party;
(f) Indirect material. ‘‘Indirect material’’ means a good used in the growth,
production, manufacture, testing, or
inspection of a good but not physically
incorporated into the good, or a good
used in the maintenance of buildings or
the operation of equipment associated
with the growth, production, or manufacture of a good, including:
(1) Fuel and energy;
(2) Tools, dies, and molds;
(3) Spare parts and materials used in
the maintenance of equipment and
buildings;
(4) Lubricants, greases, compounding
materials, and other materials used in
the growth, production, or manufacture of a good or used to operate equipment and buildings;

(5) Gloves, glasses, footwear, clothing, safety equipment, and supplies;
(6) Equipment, devices, and supplies
used for testing or inspecting the good;
(7) Catalysts and solvents; and
(8) Any other goods that are not incorporated into the good but the use of
which in the growth, production, or
manufacture of the good can reasonably be demonstrated to be a part of
that growth, production, or manufacture;
(g) Material. ‘‘Material’’ means a good,
including a part or ingredient, that is
used in the growth, production, or
manufacture of another good that is a
new or different article of commerce
that has been grown, produced, or manufactured in one or both of the Parties;
(h) Material produced in the territory of
one or both of the Parties. ‘‘Material produced in the territory of one or both of
the Parties’’ means a good that is either wholly the growth, product, or
manufacture of one or both of the Parties, or a new or different article of
commerce that has been grown, produced, or manufactured in the territory of one or both of the Parties;
(i) New or different article of commerce.
A ‘‘new or different article of commerce’’ exists when the country of origin of a good which is produced in a
Party from foreign materials is determined to be that country under the
provisions of §§ 102.1 through 102.21 of
this chapter;
(j) Non-originating material. ‘‘Non-originating material’’ means a material
that does not qualify as originating
under this subpart or General Note 27,
HTSUS;
(k) Packing materials and containers
for shipment. ‘‘Packing materials and
containers for shipment’’ means the
goods used to protect a good during its
transportation to the United States,
and does not include the packaging materials and containers in which a good
is packaged for retail sale;
(l) Recovered goods. ‘‘Recovered goods’’
means materials in the form of individual parts that result from:
(1) The complete disassembly of used
goods into individual parts; and
(2) The cleaning, inspecting, testing,
or other processing of those parts as
necessary for improvement to sound
working condition;

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U.S. Customs and Border Protection, DHS; Treasury
(m) Remanufactured good. ‘‘Remanufactured good’’ means an industrial
good that is assembled in the territory
of a Party and that:
(1) Is entirely or partially comprised
of recovered goods;
(2) Has a similar life expectancy to,
and meets the similar performance
standards as, a like good that is new;
and
(3) Enjoys the factory warranty similar to that of a like good that is new;
(n) Simple combining or packaging operations. ‘‘Simple combining or packaging
operations’’ means operations such as
adding batteries to electronic devices,
fitting together a small number of
components by bolting, gluing, or soldering, or packing or repacking components together;
CBP Dec. 07–51, 72 FR 35651, June 29, 2007, as
amended at CBP Dec. 08–29, 73 FR 45354, Aug.
5, 2008]

§ 10.770

Originating goods.

(a) General. A good will be considered
an originating good under the MFTA
when imported directly from the territory of a Party into the territory of the
other Party only if:
(1) The good is wholly the growth,
product, or manufacture of one or both
of the Parties;
(2) The good is a new or different article of commerce, as defined in
§ 10.769(i) of this subpart, that has been
grown, produced, or manufactured in
the territory of one or both of the Parties, is provided for in a heading or subheading of the HTSUS that is not covered by the product-specific rules set
forth in General Note 27(h), HTSUS,
and meets the value-content requirement specified in paragraph (b) of this
section; or
(3) The good is provided for in a heading or subheading of the HTSUS covered by the product-specific rules set
forth in General Note 27(h), HTSUS,
and:
(i)(A) Each of the non-originating
materials used in the production of the
good undergoes an applicable change in
tariff classification specified in General Note 27(h), HTSUS, as a result of
production occurring entirely in the
territory of one or both of the Parties;
or

§ 10.771

(B) The good otherwise satisfies the
requirements specified in General Note
27(h), HTSUS; and
(ii) The good meets any other requirements specified in General Note
27, HTSUS.
(b) Value-content requirement. A good
described in paragraph (a)(2) of this
section will be considered an originating good under the MFTA only if
the sum of the value of materials produced in one or both of the Parties,
plus the direct costs of processing operations (see § 10.774 of this subpart) performed in one or both of the Parties, is
not less than 35 percent of the appraised value of the good at the time
the good is entered into the territory
of the United States.
(c) Combining, packaging, and diluting
operations. For purposes of this subpart, a good will not be considered a
new or different article of commerce by
virtue of having undergone simple
combining or packaging operations, or
mere dilution with water or another
substance that does not materially
alter the characteristics of the good.
The principles and examples set forth
in § 10.195(a)(2) of this part will apply
equally for purposes of this paragraph.
CBP Dec. 07–51, 72 FR 35651, June 29, 2007, as
amended at CBP Dec. 08–29, 73 FR 45354, Aug.
5, 2008]

§ 10.771

Textile or apparel goods.

(a) De minimis. Except as provided in
paragraph (a)(1) of this section, a textile or apparel good that is not an originating good under the MFTA because
certain fibers or yarns used in the production of the component of the good
that determines the tariff classification of the good do not undergo an applicable change in tariff classification
set out in General Note 27(h), HTSUS,
will be considered to be an originating
good if the total weight of all such fibers is not more than seven percent of
the total weight of that component.
(1) Exception. A textile or apparel
good containing elastomeric yarns in
the component of the good that determines the tariff classification of the
good will be considered to be an originating good only if such yarns are
wholly formed in the territory of a
Party.

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§ 10.772

19 CFR Ch. I (4–1–11 Edition)

(2) Yarn, fabric, or group of fibers. For
purposes of paragraph (a) of this section, in the case of a textile or apparel
good that is a yarn, fabric, or group of
fibers, the term ‘‘component of the
good that determines the tariff classification of the good’’ means all of the
fibers in the yarn, fabric, or group of fibers.
(b) Textile or apparel goods put up in
sets. Notwithstanding the specific rules
specified in General Note 27(h), HTSUS,
textile or apparel goods classifiable as
goods put up in sets for retail sale as
provided for in General Rule of Interpretation 3, HTSUS, will not be considered to be originating goods under the
MFTA unless each of the goods in the
set is an originating good or the total
value of the non-originating goods in
the set does not exceed ten percent of
the appraised value of the set.
§ 10.772

Accumulation.

(a) An originating good or material
produced in the territory of one or both
of the Parties that is incorporated into
a good in the territory of the other
Party will be considered to originate in
the territory of the other Party.
(b) A good that is grown, produced, or
manufactured in the territory of one or
both of the Parties by one or more producers is an originating good if the
good satisfies the requirements of
§ 10.770 of this subpart and all other applicable requirements of General Note
27, HTSUS.
§ 10.773

Value of materials.

(a) General. For purposes of § 10.770(b)
of this subpart and, except as provided
in paragraph (b) of this section, the
value of a material produced in the territory of one or both of the Parties includes the following:
(1) The price actually paid or payable
for the material by the producer of the
good;
(2) The freight, insurance, packing
and all other costs incurred in transporting the material to the producer’s
plant, if such costs are not included in
the price referred to in paragraph (a)(1)
of this section;
(3) The cost of waste or spoilage resulting from the use of the material in
the growth, production, or manufac-

ture of the good, less the value of recoverable scrap; and
(4) Taxes or customs duties imposed
on the material by one or both of the
Parties, if the taxes or customs duties
are not remitted upon exportation
from the territory of a Party.
(b) Exception. If the relationship between the producer of a good and the
seller of a material influenced the price
actually paid or payable for the material, or if there is no price actually
paid or payable by the producer for the
material, the value of the material produced in the territory of one or both of
the Parties, includes the following:
(1) All expenses incurred in the
growth, production, or manufacture of
the material, including general expenses;
(2) A reasonable amount for profit;
and
(3) The freight, insurance, packing,
and all other costs incurred in transporting the material to the producer’s
plant.
§ 10.774 Direct costs of processing operations.
(a) Items included. For purposes of
§ 10.770(b) of this subpart, the words
‘‘direct costs of processing operations’’,
with respect to a good, mean those
costs either directly incurred in, or
that can be reasonably allocated to,
the growth, production, or manufacture of the good in the territory of one
or both of the Parties. Such costs include, to the extent they are includable
in the appraised value of the good when
imported into a Party, the following:
(1) All actual labor costs involved in
the growth, production, or manufacture of the specific good, including
fringe benefits, on-the-job training, and
the costs of engineering, supervisory,
quality control, and similar personnel;
(2) Tools, dies, molds, and other indirect materials, and depreciation on
machinery and equipment that are allocable to the specific good;
(3) Research, development, design,
engineering, and blueprint costs, to the
extent that they are allocable to the
specific good;
(4) Costs of inspecting and testing the
specific good; and

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U.S. Customs and Border Protection, DHS; Treasury
(5) Costs of packaging the specific
good for export to the territory of the
other Party.
(b) Items not included. For purposes of
§ 10.770(b) of this subpart, the words
‘‘direct costs of processing operations’’
do not include items that are not directly attributable to the good or are
not costs of growth, production, or
manufacture of the good. These include, but are not limited to:
(1) Profit; and
(2) General expenses of doing business
that are either not allocable to the
good or are not related to the growth,
production, or manufacture of the
good, such as administrative salaries,
casualty and liability insurance, advertising, and salesmen’s salaries, commissions, or expenses.
§ 10.775 Packaging and packing materials and containers for retail sale
and for shipment.
Packaging materials and containers
in which a good is packaged for retail
sale and packing materials and containers for shipment are to be disregarded in determining whether a
good qualifies as an originating good
under § 10.770 of this subpart and General Note 27, HTSUS, except to the extent that the value of such packaging
and packing materials and containers
may be included in meeting the valuecontent
requirement
specified
in
§ 10.770(b) of this subpart.
§ 10.776 Indirect materials.
Indirect materials are to be disregarded in determining whether a
good qualifies as an originating good
under § 10.770 of this subpart and General Note 27, HTSUS, except that the
cost of such indirect materials may be
included in meeting the value-content
requirement specified in § 10.770(b) of
this subpart.
§ 10.777 Imported directly.
(a) General. To qualify as an originating good under the MFTA, a good
must be imported directly from the
territory of a Party into the territory
of the other Party. For purposes of this
subpart, the words ‘‘imported directly’’
mean:
(1) Direct shipment from the territory of a Party into the territory of the

§ 10.778

other Party without passing through
the territory of a non-Party; or
(2) If the shipment passed through
the territory of a non-Party, the good,
upon arrival in the territory of a
Party, will be considered to be ‘‘imported directly’’ only if the good did
not undergo production, manufacturing, or any other operation outside
the territories of the Parties, other
than unloading, reloading, or any other
operation necessary to preserve the
good in good condition or to transport
the good to the territory of a Party.
Operations that may be performed outside the territories of the Parties include inspection, removal of dust that
accumulates during shipment, ventilation, spreading out or drying, chilling,
replacing salt, sulfur dioxide, or aqueous solutions, replacing damaged packing materials and containers, and removal of units of the good that are
spoiled or damaged and present a danger to the remaining units of the good,
or to transport the good to the territory of a Party.
(b) Documentary evidence. An importer making a claim for preferential
tariff treatment under the MFTA for
an originating good may be required to
demonstrate, to CBP’s satisfaction,
that the good was ‘‘imported directly’’
from the territory of a Party into the
territory of the other Party, as that
term is defined in paragraph (a) of this
section. An importer may demonstrate
compliance with this section by submitting documentary evidence. Such
evidence may include, but is not limited to, bills of lading, airway bills,
packing lists, commercial invoices, receiving and inventory records, and customs entry and exit documents.
TARIFF PREFERENCE LEVEL
§ 10.778 Filing of claim for tariff preference level.
A fabric or apparel good described in
§ 10.779 of this subpart that does not
qualify as an originating good under
§ 10.770 of this subpart may nevertheless be entitled to preferential tariff
treatment under the MFTA under an
applicable
tariff
preference
level
(TPL). To make a TPL claim, the importer must include on the entry summary, or equivalent documentation,

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§ 10.779

19 CFR Ch. I (4–1–11 Edition)

the applicable subheading in Chapter 99
of the HTSUS (9912.99.20) immediately
above the applicable subheading in
Chapters 51 through 62 of the HTSUS
under which each non-originating fabric or apparel good is classified.
§ 10.779 Goods eligible for tariff preference claims.
The following goods are eligible for a
TPL claim filed under § 10.778 of this
subpart:
(a) Fabric goods. Fabric goods provided for in Chapters 51, 52, 54, 55, 58,
and 60 of the HTSUS that are wholly
formed in Morocco, regardless of the
origin of the fiber or yarn used to
produce the goods, provided that they
meet the applicable conditions for preferential tariff treatment under the
MFTA, other than the condition that
they are originating; and
(b) Apparel goods. Apparel goods provided for in Chapters 61 and 62 of the
HTSUS that are cut or knit to shape,
or both, and sewn or otherwise assembled in Morocco, regardless of the origin of the fabric or yarn used to
produce the goods, provided that they
meet the applicable conditions for preferential tariff treatment under the
MFTA, other than the condition that
they are originating goods.
§ 10.780 Transshipment of non-originating fabric or apparel goods.
(a) General. To qualify for preferential tariff treatment under an applicable TPL, a good must be imported
directly from the territory of a Party
into the territory of the other Party.
For purposes of this subpart, the words
‘‘imported directly’’ mean:
(1) Direct shipment from the territory of a Party into the territory of the
other Party without passing through
the territory of a non-Party; or
(2) If the shipment passed through
the territory of a non-Party, the good,
upon arrival in the territory of a
Party, will be considered to be ‘‘imported directly’’ only if the good did
not undergo production, manufacturing, or any other operation outside
the territories of the Parties, other
than unloading, reloading, or any other
operation necessary to preserve it in
good condition or to transport the good
to the territory of a Party. Operations

that may be performed outside the territories of the Parties include inspection, removal of dust that accumulates
during shipment, ventilation, spreading out or drying, chilling, replacing
salt, sulfur dioxide, or other aqueous
solutions, replacing damaged packing
materials and containers, and removal
of units of the good that are spoiled or
damaged and present a danger to the
remaining units of the good, or to
transport the good to the territory of a
Party.
(b) Documentary evidence. An importer making a claim for preferential
tariff treatment under an applicable
TPL may be required to demonstrate,
to CBP’s satisfaction, that the good
was ‘‘imported directly’’ from the territory of a Party into the territory of the
other Party, as that term is defined in
paragraph (a) of this section. An importer may demonstrate compliance
with this section by submitting documentary evidence. Such evidence may
include, but is not limited to, bills of
lading, airway bills, packing lists, commercial invoices, receiving and inventory records, and customs entry and
exit documents.
§ 10.781 Effect of noncompliance; failure to provide documentation regarding transshipment of non-originating fabric or apparel goods.
(a) Effect of noncompliance. If an importer of a good for which a TPL claim
is made fails to comply with any applicable requirement under this subpart,
the port director may deny preferential
tariff treatment to the imported good.
(b) Failure to provide documentation regarding transshipment. Where the requirements for preferential tariff treatment set forth elsewhere in this subpart are met, the port director nevertheless may deny preferential tariff
treatment to a good for which a TPL
claim is made if the good is shipped
through or transshipped in a country
other than a Party, and the importer of
the good does not provide, at the request of the port director, evidence
demonstrating to the satisfaction of
the port director that the requirements
set forth in § 10.780 of this subpart were
met.

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U.S. Customs and Border Protection, DHS; Treasury
ORIGIN VERIFICATIONS AND
DETERMINATIONS

§ 10.787
PENALTIES

§ 10.784 Verification and justification
of claim for preferential treatment.
(a) Verification. A claim for preferential treatment made under § 10.763
of this subpart, including any declaration or other information submitted to
CBP in support of the claim, will be
subject to such verification as the port
director deems necessary. In the event
that the port director is provided with
insufficient information to verify or
substantiate the claim, the port director may deny the claim for preferential
treatment.
(b) Applicable accounting principles.
When conducting a verification of origin to which Generally Accepted Accounting Principles may be relevant,
CBP will apply and accept the Generally Accepted Accounting Principles
applicable in the country of production.
§ 10.785 Issuance of negative origin determinations.
If, as a result of an origin
verification initiated under this subpart, CBP determines that a claim for
preferential tariff treatment made
under § 10.763 of this subpart should be
denied, it will issue a determination in
writing or via an authorized electronic
data interchange system to the importer that sets forth the following:
(a) A description of the good that was
the subject of the verification together
with the identifying numbers and dates
of the export and import documents
pertaining to the good;
(b) A statement setting forth the
findings of fact made in connection
with the verification and upon which
the determination is based; and
(c) With specific reference to the
rules applicable to originating goods as
set forth in General Note 27, HTSUS,
and in §§ 10.769 through 10.777 of this
subpart, the legal basis for the determination.
CBP Dec. 07–51, 72 FR 35651, June 29, 2007. Redesignated at CBP Dec. 08–29, 73 FR 45354,
Aug. 5, 2008]

§ 10.786 Violations relating to the
MFTA.
All criminal, civil, or administrative
penalties which may be imposed on
U.S. importers for violations of the
customs and related laws and regulations will also apply to U.S. importers
for violations of the laws and regulations relating to the MFTA.
CBP Dec. 07–51, 72 FR 35651, June 29, 2007. Redesignated at CBP Dec. 08–29, 73 FR 45354,
Aug. 5, 2008]

GOODS RETURNED AFTER REPAIR OR
ALTERATION
§ 10.787 Goods re-entered after repair
or alteration in Morocco.
(a) General. This section sets forth
the rules that apply for purposes of obtaining duty-free treatment on goods
returned after repair or alteration in
Morocco as provided for in subheadings
9802.00.40 and 9802.00.50, HTSUS. Goods
returned after having been repaired or
altered in Morocco, whether or not pursuant to a warranty, are eligible for
duty-free treatment, provided that the
requirements of this section are met.
For purposes of this section, ‘‘repairs or
alterations’’ means restoration, addition, renovation, re-dyeing, cleaning,
re-sterilizing, or other treatment
which does not destroy the essential
characteristics of, or create a new or
commercially different good from, the
good exported from the United States.
(b) Goods not eligible for treatment. The
duty-free treatment referred to in
paragraph (a) of this section will not
apply to goods which, in their condition as exported from the United
States to Morocco, are incomplete for
their intended use and for which the
processing operation performed in Morocco constitutes an operation that is
performed as a matter of course in the
preparation or manufacture of finished
goods.
(c) Documentation. The provisions of
§ 10.8(a), (b), and (c) of this part, relating to the documentary requirements
for goods entered under subheading
9802.00.40 or 9802.00.50, HTSUS, will
apply in connection with the entry of
goods which are returned from Morocco
after having been exported for repairs

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§ 10.801

19 CFR Ch. I (4–1–11 Edition)

or alterations and which are claimed to
be duty free.
CBP Dec. 07–51, 72 FR 35651, June 29, 2007. Redesignated at CBP Dec. 08–29, 73 FR 45354,
Aug. 5, 2008]

Subpart N—United States-Bahrain
Free Trade Agreement
SOURCE: CBP Dec. 07–81, 72 FR 58515, Oct.
16, 2007, unless otherwise noted.

GENERAL PROVISIONS
§ 10.801 Scope.
This subpart implements the duty
preference and related customs provisions applicable to imported goods
under the United States-Bahrain Free
Trade Agreement (the BFTA) signed on
September 14, 2004, and under the
United States-Bahrain Free Trade
Agreement Implementation Act (the
Act; 119 Stat. 3581). Except as otherwise
specified in this subpart, the procedures and other requirements set forth
in this subpart are in addition to the
customs procedures and requirements
of general application contained elsewhere in this chapter. Additional provisions implementing certain aspects
of the BFTA and the Act are contained
in parts 24, 102, 162, and 163 of this
chapter.
§ 10.802 General definitions.
As used in this subpart, the following
terms will have the meanings indicated
unless either the context in which they
are used requires a different meaning
or a different definition is prescribed
for a particular section of this subpart:
(a) Claim of origin. ‘‘Claim of origin’’
means a claim that a good is an originating good or a good of a Party;
(b) Claim for preferential tariff treatment. ‘‘Claim for preferential tariff
treatment’’ means a claim that a good
is entitled to the duty rate applicable
under the BFTA to an originating good
or other good specified in the BFTA,
and to an exemption from the merchandise processing fee;
(c) Customs Valuation Agreement.
‘‘Customs Valuation Agreement’’ means
the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994, which is part of the
WTO Agreement;

(d) Customs duty. ‘‘Customs duty’’ includes any customs or import duty and
a charge of any kind imposed in connection with the importation of a good,
including any form of surtax or surcharge in connection with such importation, but does not include any:
(1) Charge equivalent to an internal
tax imposed consistently with Article
III:2 of the GATT 1994; in respect of
like, directly competitive, or substitutable goods of the Party, or in respect of
goods from which the imported good
has been manufactured or produced in
whole or in part;
(2) Antidumping or countervailing
duty; and
(3) Fee or other charge in connection
with importation commensurate with
the cost of services rendered;
(e) Days. ‘‘Days’’ means calendar days;
(f) Enterprise. ‘‘Enterprise’’ means any
entity constituted or organized under
applicable law, whether or not for profit, and whether privately-owned or governmentally-owned, including any corporation, trust, partnership, sole proprietorship, joint venture, or other association;
(g) Foreign material. ‘‘Foreign material’’ means a material other than a
material produced in the territory of
one or both of the Parties;
(h) GATT 1994. ‘‘GATT 1994’’ means the
General Agreement on Tariffs and Trade
1994, which is part of the WTO Agreement;
(i) Good. ‘‘Good’’ means any merchandise, product, article, or material;
(j) Harmonized System. ‘‘Harmonized
System (HS)’’ means the Harmonized
Commodity Description and Coding System, including its General Rules of Interpretation, Section Notes, and Chapter Notes, as adopted and implemented
by the Parties in their respective tariff
laws;
(k) Heading. ‘‘Heading’’ means the
first four digits in the tariff classification number under the Harmonized
System;
(l) HTSUS. ‘‘HTSUS’’ means the Harmonized Tariff Schedule of the United
States as promulgated by the U.S.
International Trade Commission;
(m) Originating. ‘‘Originating’’ means
a good qualifying under the rules of origin set forth in General Note 30,

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U.S. Customs and Border Protection, DHS; Treasury
HTSUS, and BFTA Chapter Three (Textiles and apparel) or Chapter Four
(Rules of Origin);
(n) Party. ‘‘Party’’ means the United
States or the Kingdom of Bahrain;
(o) Person. ‘‘Person’’ means a natural
person or an enterprise;
(p) Preferential tariff treatment. ‘‘Preferential tariff treatment’’ means the
duty rate applicable under the BFTA
to an originating good and an exemption from the merchandise processing
fee;
(q) Subheading. ‘‘Subheading’’ means
the first six digits in the tariff classification number under the Harmonized
System;
(r) Textile or apparel good. ‘‘Textile or
apparel good’’ means a good listed in
the Annex to the Agreement on Textiles and Clothing (commonly referred
to as ‘‘the ATC’’), which is part of the
WTO Agreement;
(s) Territory. ‘‘Territory’’ means:
(1) With respect to Bahrain, the territory of Bahrain as well as the maritime
areas, seabed, and subsoil over which
Bahrain exercises, in accordance with
international law, sovereignty, sovereign rights, and jurisdiction; and
(2) With respect to the United States,
(i) The customs territory of the
United States, which includes the 50
states, the District of Columbia, and
Puerto Rico,
(ii) The foreign trade zones located in
the United States and Puerto Rico, and
(iii) Any areas beyond the territorial
seas of the United States within which,
in accordance with international law
and its domestic law, the United States
may exercise rights with respect to the
seabed and subsoil and their natural resources; and
(t) WTO Agreement. ‘‘WTO Agreement’’
means the Marrakesh Agreement Establishing the World Trade Organization of
April 15, 1994.
IMPORT REQUIREMENTS
§ 10.803 Filing of claim for preferential
tariff treatment upon importation.
An importer may make a claim for
BFTA preferential tariff treatment for
an originating good by including on the
entry summary, or equivalent documentation, the symbol ‘‘BH’’ as a prefix
to the subheading of the HTSUS under
which each qualifying good is classi-

§ 10.804

fied, or by the method specified for
equivalent reporting via an authorized
electronic data interchange system.
§ 10.804 Declaration.
(a) Contents. An importer who claims
preferential tariff treatment for a good
under the BFTA must submit to CBP,
at the request of the port director, a
declaration setting forth all pertinent
information concerning the growth,
production, or manufacture of the
good. A declaration submitted to CBP
under this paragraph:
(1) Need not be in a prescribed format
but must be in writing or must be
transmitted electronically pursuant to
any electronic means authorized by
CBP for that purpose;
(2) Must include the following information:
(i) The legal name, address, telephone, and e-mail address (if any) of
the importer of record of the good;
(ii) The legal name, address, telephone, and e-mail address (if any) of
the responsible official or authorized
agent of the importer signing the declaration (if different from the information required by paragraph (a)(2)(i) of
this section);
(iii) The legal name, address, telephone and e-mail address (if any) of the
exporter of the good (if different from
the producer);
(iv) The legal name, address, telephone and e-mail address (if any) of the
producer of the good (if known);
(v) A description of the good, which
must be sufficiently detailed to relate
it to the invoice and HS nomenclature,
including quantity, numbers, invoice
numbers, and bills of lading;
(vi) A description of the operations
performed in the growth, production,
or manufacture of the good in the territory of one or both of the Parties
and, where applicable, identification of
the direct costs of processing operations;
(vii) A description of any materials
used in the growth, production, or
manufacture of the good that are wholly the growth, product, or manufacture
of one or both of the Parties, and a
statement as to the value of such materials;
(viii) A description of the operations
performed on, and a statement as to

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§ 10.805

19 CFR Ch. I (4–1–11 Edition)

the origin and value of, any materials
used in the article that are claimed to
have been sufficiently processed in the
territory of one or both of the Parties
so as to be materials produced in one
or both of the Parties, or are claimed
to have undergone an applicable
change in tariff classification specified
in General Note 30(h), HTSUS; and
(ix) A description of the origin and
value of any foreign materials used in
the good that have not been substantially transformed in the territory of
one or both of the Parties, or have not
undergone an applicable change in tariff classification specified in General
Note 30(h), HTSUS;
(3) Must include a statement, in substantially the following form:
‘‘I certify that:
The information on this document is true
and accurate and I assume the responsibility
for proving such representations. I understand that I am liable for any false statements or material omissions made on or in
connection with this document;
I agree to maintain and present upon request, documentation necessary to support
these representations;
The goods comply with all the requirements for preferential tariff treatment specified for those goods in the United StatesBahrain Free Trade Agreement; and
This document consists of lll pages, including all attachments.’’

(b) Responsible official or agent. The
declaration must be signed and dated
by a responsible official of the importer or by the importer’s authorized
agent having knowledge of the relevant
facts.
(c) Language. The declaration must
be completed in the English language.
(d) Applicability of declaration. The
declaration may be applicable to:
(1) A single importation of a good
into the United States, including a single shipment that results in the filing
of one or more entries and a series of
shipments that results in the filing of
one entry; or
(2) Multiple importations of identical
goods into the United States that
occur within a specified blanket period,
not exceeding 12 months, set out in the
declaration. For purposes of this paragraph, ‘‘identical goods’’ means goods
that are the same in all respects relevant to the production that qualifies

the goods for preferential tariff treatment.
[CBP Dec. 07–81, 72 FR 58515, Oct. 16, 2007, as
amended at CBP 08-28, 73 FR 42681, July 23,
2008]

§ 10.805

Importer obligations.

(a) General. An importer who makes a
claim for preferential tariff treatment
under § 10.803 of this subpart:
(1) Will be deemed to have certified
that the good is eligible for preferential tariff treatment under the
BFTA:
(2) Is responsible for the truthfulness
of the information and data contained
in the declaration provided for in
§ 10.804 of this subpart; and
(3) Is responsible for submitting any
supporting documents requested by
CBP and for the truthfulness of the information contained in those documents. CBP will allow for the direct
submission by the exporter or producer
of business confidential or other sensitive information, including cost and
sourcing information.
(b) Information provided by exporter or
producer. The fact that the importer
has made a claim for preferential tariff
treatment or prepared a declaration
based on information provided by an
exporter or producer will not relieve
the importer of the responsibility referred to in paragraph (a) of this section.
§ 10.806

Declaration not required.

(a) General. Except as otherwise provided in paragraph (b) of this section,
an importer will not be required to submit a declaration under § 10.804 of this
subpart for:
(1) A non-commercial importation of
a good; or
(2) A commercial importation for
which the value of the originating
goods does not exceed U.S. $2,500.
(b) Exception. If the port director determines that an importation described
in paragraph (a) of this section may
reasonably be considered to have been
carried out or planned for the purpose
of evading compliance with the rules
and procedures governing claims for
preference under the BFTA, the port
director will notify the importer that
for that importation the importer must

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U.S. Customs and Border Protection, DHS; Treasury
submit to CBP a declaration. The importer must submit such a declaration
within 30 days from the date of the notice. Failure to timely submit the declaration will result in denial of the
claim for preferential tariff treatment.
§ 10.807

Maintenance of records.

(a) General. An importer claiming
preferential tariff treatment for a good
under § 10.803 of this subpart must
maintain, for five years after the date
of the claim for preferential tariff
treatment, all records and documents
necessary for the preparation of the
declaration.
(b) Applicability of other recordkeeping
requirements. The records and documents referred to in paragraph (a) of
this section are in addition to any
other records required to be made,
kept, and made available to CBP under
part 163 of this chapter.
(c) Method of maintenance. The
records and documents referred to in
paragraph (a) of this section must be
maintained by importers as provided in
§ 163.5 of this chapter.
§ 10.808 Effect of noncompliance; failure to provide documentation regarding transshipment.
(a) General. If the importer fails to
comply with any requirement under
this subpart, including submission of a
complete declaration under § 10.804 of
this subpart, when requested, the port
director may deny preferential tariff
treatment to the imported good.
(b) Failure to provide documentation regarding transshipment. Where the requirements for preferential tariff treatment set forth elsewhere in this subpart are met, the port director nevertheless may deny preferential treatment to a good if the good is shipped
through or transshipped in the territory of a country other than a Party,
and the importer of the good does not
provide, at the request of the port director, evidence demonstrating to the
satisfaction of the port director that
the good was imported directly from
the territory of a Party into the territory of the other Party (see § 10.817 of
this subpart).

§ 10.809
RULES OF ORIGIN

§ 10.809

Definitions.

For purposes of §§ 10.809 through
10.817:
(a) Exporter. ‘‘Exporter’’ means a person who exports goods from the territory of a Party;
(b) Generally Accepted Accounting
Principles. ‘‘Generally Accepted Accounting Principles’’ means the recognized consensus or substantial authoritative support in the territory of a
Party, with respect to the recording of
revenues, expenses, costs, assets, and
liabilities, the disclosure of information, and the preparation of financial
statements. These standards may encompass broad guidelines of general application as well as detailed standards,
practices, and procedures;
(c) Good. ‘‘Good’’ means any merchandise, product, article, or material;
(d) Goods wholly the growth, product,
or manufacture of one or both of the Parties. ‘‘Goods wholly the growth, product, or manufacture of one or both of
the Parties’’ means:
(1) Mineral goods extracted in the
territory of one or both of the Parties;
(2) Vegetable goods, as such goods are
defined in the HTSUS, harvested in the
territory of one or both of the Parties;
(3) Live animals born and raised in
the territory of one or both of the Parties;
(4) Goods obtained from live animals
raised in the territory of one or both of
the Parties;
(5) Goods obtained from hunting,
trapping, or fishing in the territory of
one or both of the parties;
(6) Goods (fish, shellfish, and other
marine life) taken from the sea by vessels registered or recorded with a party
and flying its flag;
(7) Goods produced from goods referred to in paragraph (d)(6) of this section on board factory ships registered
or recorded with that Party and flying
its flag;
(8) Goods taken by a Party or a person of a Party from the seabed or beneath the seabed outside territorial
waters, provided that a Party has
rights to exploit such seabed;
(9) Goods taken from outer space,
provided they are obtained by a Party

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§ 10.809

19 CFR Ch. I (4–1–11 Edition)

or a person of a Party and not processed in the territory of a non-Party;
(10) Waste and scrap derived from:
(i) Production or manufacture in the
territory of one or both of the Parties,
or
(ii) Used goods collected in the territory of one or both of the Parties, provided such goods are fit only for the recovery of raw materials;
(11) Recovered goods derived in the
territory of a Party from used goods,
and utilized in the territory of that
Party in the production of remanufactured goods; and
(12) Goods produced in the territory
of one or both of the Parties exclusively from goods referred to in paragraphs (d)(1) through (d)(10) of this section, or from their derivatives, at any
stage of production;
(e) Importer. Importer means a person
who imports goods into the territory of
a Party;
(f) Indirect material. ‘‘Indirect material’’ means a good used in the growth,
production, manufacture, testing, or
inspection of a good but not physically
incorporated into the good, or a good
used in the maintenance of buildings or
the operation of equipment associated
with the growth, production, or manufacture of a good, including:
(1) Fuel and energy;
(2) Tools, dies, and molds;
(3) Spare parts and materials used in
the maintenance of equipment and
buildings;
(4) Lubricants, greases, compounding
materials, and other materials used in
the growth, production, or manufacture of a good or used to operate equipment and buildings;
(5) Gloves, glasses, footwear, clothing, safety equipment, and supplies;
(6) Equipment, devices, and supplies
used for testing or inspecting the good;
(7) Catalysts and solvents; and
(8) Any other goods that are not incorporated into the good but the use of
which in the growth, production, or
manufacture of the good can reasonably be demonstrated to be a part of
that growth, production, or manufacture;
(g) Material. ‘‘Material’’ means a good,
including a part or ingredient, that is
used in the growth, production, or
manufacture of another good that is a

new or different article of commerce
that has been grown, produced, or manufactured in one or both of the Parties;
(h) Material produced in the territory of
one or both of the Parties. ‘‘Material produced in the territory of one or both of
the Parties’’ means a good that is either wholly the growth, product, or
manufacture of one or both of the Parties, or a new or different article of
commerce that has been grown, produced, or manufactured in the territory of one or both of the Parties;
(i) New or different article of commerce.
A ‘‘new or different article of commerce’’ exists when the country of origin of a good which is produced in a
Party from foreign materials is determined to be that country under the
provisions of §§ 102.1 through 102.21 of
this chapter;
(j) Non-originating material. ‘‘Non-originating material’’ means a material
that does not qualify as originating
under this subpart or General Note 30,
HTSUS;
(k) Packing materials and containers
for shipment. ‘‘Packing materials and
containers for shipment’’ means the
goods used to protect a good during its
transportation to the United States,
and does not include the packaging materials and containers in which a good
is packaged for retail sale;
(l) Recovered goods. ‘‘Recovered goods’’
means materials in the form of individual parts that result from:
(1) The complete disassembly of used
goods into individual parts; and
(2) The cleaning, inspecting, testing,
or other processing of those parts as
necessary for improvement to sound
working condition;
(m) Remanufactured good. ‘‘Remanufactured good’’ means an industrial
good that is assembled in the territory
of a Party and that:
(1) Is entirely or partially comprised
of recovered goods;
(2) Has a similar life expectancy to,
and meets the same performance standards as, a like good that is new; and
(3) Enjoys the factory warranty similar to that of a like good that is new;
(n) Simple combining or packaging operations. ‘‘Simple combining or packaging
operations’’ means operations such as
adding batteries to electronic devices,
fitting together a small number of

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U.S. Customs and Border Protection, DHS; Treasury
components by bolting, gluing, or soldering, and repacking and packaging
components together.
[ CBP Dec. 07–81, 72 FR 58515, Oct. 16, 2007, as
amended at CBP Dec. 10–29, 75 FR 52450, Aug.
26, 2010]

§ 10.810 Originating goods.
(a) General. A good will be considered
an originating good under the BFTA
when imported directly from the territory of a Party into the territory of the
other Party only if:
(1) The good is wholly the growth,
product, or manufacture of one or both
of the Parties;
(2) The good is a new or different article of commerce, as defined in
§ 10.809(i) of this subpart, that has been
grown, produced, or manufactured in
the territory of one or both of the Parties, is provided for in a heading or subheading of the HTSUS that is not covered by the product-specific rules set
forth in General Note 30(h), HTSUS,
and meets the value-content requirement specified in paragraph (b) of this
section; or
(3) The good is provided for in a heading or subheading of the HTSUS covered by the product-specific rules set
forth in General Note 30(h), HTSUS,
and:
(i)(A) Each of the non-originating
materials used in the production of the
good undergoes an applicable change in
tariff classification specified in General Note 30(h), HTSUS, as a result of
production occurring entirely in the
territory of one or both of the Parties;
or
(B) The good otherwise satisfies the
requirements specified in General Note
30(h), HTSUS; and
(ii) The good meets any other requirements specified in General Note
30, HTSUS.
(b) Value-content requirement. A good
described in paragraph (a)(2) of this
section will be considered an originating good under the BFTA only if
the sum of the value of materials produced in one or both of the Parties,
plus the direct costs of processing operations performed in one or both of the
Parties, is not less than 35 percent of
the appraised value of the good at the
time the good is entered into the territory of the United States.

§ 10.812

(c) Combining, packaging, and diluting
operations. For purposes of this subpart, a good will not be considered a
new or different article of commerce by
virtue of having undergone simple
combining or packaging operations, or
mere dilution with water or another
substance that does not materially
alter the characteristics of the good.
The principles and examples set forth
in § 10.195(a)(2) of this part will apply
equally for purposes of this paragraph.
§ 10.811 Textile or apparel goods.
(a) De minimis—(1) General. Except as
provided in paragraph (a)(2) of this section, a textile or apparel good that is
not an originating good under the
BFTA because certain fibers or yarns
used in the production of the component of the good that determines the
tariff classification of the good do not
undergo an applicable change in tariff
classification set out in General Note
30(h), HTSUS, will be considered to be
an originating good if the total weight
of all such fibers or yarns is not more
than seven percent of the total weight
of that component.
(2) Exception. A textile or apparel
good containing elastomeric yarns in
the component of the good that determines the tariff classification of the
good will be considered to be an originating good only if such yarns are
wholly formed in the territory of a
Party.
(b) Textile or apparel goods put up in
sets. Notwithstanding the specific rules
specified in General Note 30(h), HTSUS,
textile or apparel goods classifiable as
goods put up in sets for retail sale as
provided for in General Rule of Interpretation 3, HTSUS, will not be considered to be originating goods under the
BFTA unless each of the goods in the
set is an originating good or the total
value of the non-originating goods in
the set does not exceed ten percent of
the appraised value of the set.
[ CBP Dec. 07–81, 72 FR 58515, Oct. 16, 2007, as
amended at CBP Dec. 10–29, 75 FR 52450, Aug.
26, 2010]

§ 10.812 Accumulation.
(a) An originating good or material
produced in the territory of one or both
of the Parties that is incorporated into
a good in the territory of the other

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§ 10.813

19 CFR Ch. I (4–1–11 Edition)

Party will be considered to originate in
the territory of the other Party.
(b) A good that is grown, produced, or
manufactured in the territory of one or
both of the Parties by one or more producers is an originating good if the
good satisfies the requirements of
§ 10.810 of this subpart and all other applicable requirements of General Note
30, HTSUS.
§ 10.813

Value of materials.

(a) General. For purposes of § 10.810(b)
of this subpart and, except as provided
in paragraph (b) of this section, the
value of a material produced in the territory of one or both of the Parties includes the following:
(1) The price actually paid or payable
for the material by the producer of the
good;
(2) The freight, insurance, packing
and all other costs incurred in transporting the material to the producer’s
plant, if such costs are not included in
the price referred to in paragraph (a)(1)
of this section;
(3) The cost of waste or spoilage resulting from the use of the material in
the growth, production, or manufacture of the good, less the value of recoverable scrap; and
(4) Taxes or customs duties imposed
on the material by one or both of the
Parties, if the taxes or customs duties
are not remitted upon exportation
from the territory of a Party.
(b) Exception. If the relationship between the producer of a good and the
seller of a material influenced the price
actually paid or payable for the material, or if there is no price actually
paid or payable by the producer for the
material, the value of the material produced in the territory of one or both of
the Parties includes the following:
(1) All expenses incurred in the
growth, production, or manufacture of
the material, including general expenses;
(2) A reasonable amount for profit;
and
(3) The freight, insurance, packing,
and all other costs incurred in transporting the material to the producer’s
plant.

§ 10.814 Direct costs of processing operations.
(a) Items included. For purposes of
§ 10.810(b) of this subpart, the words
‘‘direct costs of processing operations’’,
with respect to a good, mean those
costs either directly incurred in, or
that can be reasonably allocated to,
the growth, production, or manufacture of the good in the territory of one
or both of the Parties. Such costs include, to the extent they are includable
in the appraised value of the good when
imported into a Party, the following:
(1) All actual labor costs involved in
the growth, production, or manufacture of the specific good, including
fringe benefits, on-the-job training, and
the costs of engineering, supervisory,
quality control, and similar personnel;
(2) Tools, dies, molds, and other indirect materials, and depreciation on
machinery and equipment that are allocable to the specific good;
(3) Research, development, design,
engineering, and blueprint costs, to the
extent that they are allocable to the
specific good;
(4) Costs of inspecting and testing the
specific good; and
(5) Costs of packaging the specific
good for export to the territory of the
other Party.
(b) Items not included. For purposes of
§ 10.810(b) of this subpart, the words
‘‘direct costs of processing operations’’
do not include items that are not directly attributable to the good or are
not costs of growth, production, or
manufacture of the good. These include, but are not limited to:
(1) Profit; and
(2) General expenses of doing business
that are either not allocable to the
good or are not related to the growth,
production, or manufacture of the
good, such as administrative salaries,
casualty and liability insurance, advertising, and salesmen’s salaries, commissions, or expenses.
§ 10.815 Packaging and packing materials and containers for retail sale
and for shipment.
Packaging materials and containers
in which a good is packaged for retail
sale and packing materials and containers for shipment are to be disregarded in determining whether a

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U.S. Customs and Border Protection, DHS; Treasury
good qualifies as an originating good
under § 10.810 of this subpart and General Note 30, HTSUS, except to the extent that the value of such packaging
and packing materials and containers
may be included in meeting the valuecontent
requirement
specified
in
§ 10.810(b) of this subpart.
§ 10.816 Indirect materials.
Indirect materials are to be disregarded in determining whether a
good qualifies as an originating good
under § 10.810 of this subpart and General Note 30, HTSUS, except that the
cost of such indirect materials may be
included in meeting the value-content
requirement specified in § 10.810(b) of
this subpart.
§ 10.817 Imported directly.
(a) General. To qualify as an originating good under the BFTA, a good
must be imported directly from the
territory of a Party into the territory
of the other Party. For purposes of this
subpart, the words ‘‘imported directly’’
mean:
(1) Direct shipment from the territory of a Party into the territory of the
other Party without passing through
the territory of a non-Party; or
(2) If the shipment passed through
the territory of a non-Party, the good,
upon arrival in the territory of a
Party, will be considered to be ‘‘imported directly’’ only if the good did
not undergo production, manufacturing, or any other operation outside
the territories of the Parties, other
than unloading, reloading, or any other
operation necessary to preserve the
good in good condition or to transport
the good to the territory of a Party.
Operations that may be performed outside the territories of the Parties include inspection, removal of dust that
accumulates during shipment, ventilation, spreading out or drying, chilling,
replacing salt, sulfur dioxide, or aqueous solutions, replacing damaged packing materials and containers, and removal of units of the good that are
spoiled or damaged and present a danger to the remaining units of the good,
or to transport the good to the territory of a Party.
(b) Documentary evidence. An importer making a claim for preferential

§ 10.819

tariff treatment under the BFTA for an
originating good may be required to
demonstrate, to CBP’s satisfaction,
that the good was ‘‘imported directly’’
from the territory of a Party into the
territory of the other Party, as that
term is defined in paragraph (a) of this
section. An importer may demonstrate
compliance with this section by submitting documentary evidence. Such
evidence may include, but is not limited to, bills of lading, airway bills,
packing lists, commercial invoices, receiving and inventory records, and customs entry and exit documents.
[CBP Dec. 07–81, 72 FR 58515, Oct. 16, 2007, as
amended at CBP Dec. 09-17, 74 FR 23951, May
22, 2009]

TARIFF PREFERENCE LEVEL
§ 10.818 Filing of claim for tariff preference level.
A fabric, apparel, or made-up good
described in § 10.819 of this subpart that
does not qualify as an originating good
under § 10.810 of this subpart may nevertheless be entitled to preferential
tariff treatment under the BFTA under
an applicable tariff preference level
(TPL). To make a TPL claim, the importer must include on the entry summary, or equivalent documentation,
the applicable subheading in Chapter 99
of the HTSUS (9914.99.20) immediately
above the applicable subheading in
Chapter 52 through Chapter 63 of the
HTSUS under which each non-originating fabric or apparel good is classified.
§ 10.819 Goods eligible for tariff preference claims.
The following goods are eligible for a
TPL claim filed under § 10.818 of this
subpart (subject to the quantitative
limitations set forth in U.S. Note 13,
Subchapter XIV, Chapter 99, HTSUS):
(a) Cotton or man-made fiber fabric
goods provided for in Chapters 52, 54,
55, 58, and 60 of the HTSUS that are
wholly formed in the territory of Bahrain from yarn produced or obtained
outside the territory of Bahrain or the
United States;
(b) Cotton or man-made fiber fabric
goods provided for in subheadings
5801.21, 5801.22, 5801.23, 5801.24, 5801.25,
5801.26, 5801.31, 5801.32, 5801.33, 5801.34,

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§ 10.820

19 CFR Ch. I (4–1–11 Edition)

5801.35, 5801.36, 5802.11, 5802.19, 5802.20,
5802.30, 5803.10, 5803.90.30, 5804.10.10,
5804.21, 5804.29.10, 5804.30, 5805.00.30,
5805.00.40, 5806.10.10, 5806.10.24, 5806.10.28,
5806.20,
5806.31,
5806.32,
5807.10.05,
5807.10.20, 5807.90.05, 5807.90.20, 5808.10.40,
5808.10.70, 5808.90, 5809.00, 5810.10, 5810.91,
5810.92, 5811.00.20, 5811.00.30, 6001.10,
6001.21, 6001.22, 6001.91, 6001.92, 6002.40,
6002.90, 6003.20, 6003.30, 6003.40, 6004.10,
6004.90, 6005.21, 6005.22, 6005.23, 6005.24,
6005.31, 6005.32, 6005.33, 6005.34, 6005.41,
6005.42, 6005.43, 6005.44, 6006.21, 6006.22,
6006.23, 6006.24, 6006.31, 6006.32, 6006.33,
6006.34, 6006.41, 6006.42, 6006.43, and
6006.44 of the HTSUS that are wholly
formed in the territory of Bahrain from
yarn spun in the territory of Bahrain
or the United States from fiber produced or obtained outside the territory
of Bahrain or the United States;
(c) Cotton or man-made fiber apparel
goods provided for in Chapters 61 or 62
of the HTSUS that are cut or knit to
shape, or both, and sewn or otherwise
assembled in the territory of Bahrain
from fabric or yarn produced or obtained outside the territory of Bahrain
or the United States; and
(d) Cotton or man-made fiber madeup goods provided for in Chapter 63 of
the HTSUS that are cut or knit to
shape, or both, and sewn or otherwise
assembled in the territory of Bahrain
from fabric wholly formed in Bahrain
or the United States from yarn produced or obtained outside the territory
of Bahrain or the United States.
§ 10.820 Certificate of eligibility.
Upon request, an importer claiming
preferential tariff treatment on a nonoriginating cotton or man-made fiber
good specified in § 10.819 of this subpart
must submit to CBP a certificate of
eligibility. The certificate of eligibility
must be completed and signed by an
authorized official of the Government
of Bahrain and must be in the possession of the importer at the time the
preferential
tariff
treatment
is
claimed.
§ 10.821 Declaration.
(a) General. An importer who claims
preferential tariff treatment on a nonoriginating cotton or man-made fiber
good specified in § 10.819 of this subpart
must submit, at the request of the port

director, a declaration supporting such
a claim for preferential tariff treatment that sets forth all pertinent information concerning the production of
the good, including:
(1) A description of the good, quantity, invoice numbers, and bills of lading;
(2) A description of the operations
performed in the production of the
good in the territory of one or both of
the Parties;
(3) A reference to the specific provision in § 10.819 of this subpart that
forms the basis for the claim for preferential tariff treatment; and
(4) A statement as to any fiber, yarn,
or fabric of a non-Party and the origin
of such materials used in the production of the good.
(b) Retention of records. An importer
must retain all documents relied upon
to prepare the declaration for a period
of five years.
§ 10.822 Transshipment of non-originating fabric or apparel goods.
(a) General. To qualify for preferential tariff treatment under an applicable TPL, a good must be imported
directly from the territory of a Party
into the territory of the other Party.
For purposes of this subpart, the words
‘‘imported directly’’ mean:
(1) Direct shipment from the territory of a Party into the territory of the
other Party without passing through
the territory of a non-Party; or
(2) If the shipment passed through
the territory of a non-Party, the good,
upon arrival in the territory of a
Party, will be considered to be ‘‘imported directly’’ only if the good did
not undergo production, manufacturing, or any other operation outside
the territories of the Parties, other
than unloading, reloading, or any other
operation necessary to preserve the
good in good condition or to transport
the good to the territory of a Party.
Operations that may be performed outside the territories of the Parties include inspection, removal of dust that
accumulates during shipment, ventilation, spreading out or drying, chilling,
replacing salt, sulfur dioxide, or aqueous solutions, replacing damaged packing materials and containers, and removal of units of the good that are

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U.S. Customs and Border Protection, DHS; Treasury
spoiled or damaged and present a danger to the remaining units of the good,
or to transport the good to the territory of a Party.
(b) Documentary evidence. An importer making a claim for preferential
tariff treatment under an applicable
TPL may be required to demonstrate,
to CBP’s satisfaction, that the good
was ‘‘imported directly’’ from the territory of a Party into the territory of the
other Party, as that term is defined in
paragraph (a) of this section. An importer may demonstrate compliance
with this section by submitting documentary evidence. Such evidence may
include, but is not limited to, bills of
lading, airway bills, packing lists, commercial invoices, receiving and inventory records, and customs entry and
exit documents.
[CBP Dec. 07–81, 72 FR 58515, Oct. 16, 2007, as
amended at CBP 08-28, 73 FR 42681, July 23,
2008; CBP Dec. 09-17, 74 FR 23951, May 22,
2009]

§ 10.823 Effect of non-compliance; failure to provide documentation regarding transshipment of non-originating fabric or apparel goods.
(a) General. If an importer of a good
for which a TPL claim is made fails to
comply with any applicable requirement under this subpart, the port director may deny preferential tariff
treatment to the imported good.
(b) Failure to provide documentation regarding transshipment. Where the requirements for preferential tariff treatment set forth elsewhere in this subpart are met, the port director nevertheless may deny preferential tariff
treatment to a good for which a TPL
claim is made if the good is shipped
through or transshipped in a country
other than a Party, and the importer of
the good does not provide, at the request of the port director, evidence
demonstrating to the satisfaction of
the port director that the requirements
set forth in § 10.822 of this subpart were
met.
ORIGIN VERIFICATIONS AND
DETERMINATIONS
§ 10.824 Verification and justification
of claim for preferential treatment.
(a) Verification. A claim for preferential treatment made under § 10.803

§ 10.826

of this subpart, including any declaration or other information submitted to
CBP in support of the claim, will be
subject to such verification as the port
director deems necessary. In the event
that the port director is provided with
insufficient information to verify or
substantiate the claim, the port director may deny the claim for preferential
treatment.
(b) Applicable accounting principles.
When conducting a verification of origin to which Generally Accepted Accounting Principles may be relevant,
CBP will apply and accept the Generally Accepted Accounting Principles
applicable in the country of production.
§ 10.825 Issuance of negative origin determinations.
If, as a result of an origin
verification initiated under this subpart, CBP determines that a claim for
preferential tariff treatment made
under § 10.803 of this subpart should be
denied, it will issue a determination in
writing or via an authorized electronic
data interchange system to the importer that sets forth the following:
(a) A description of the good that was
the subject of the verification together
with the identifying numbers and dates
of the export and import documents
pertaining to the good;
(b) A statement setting forth the
findings of fact made in connection
with the verification and upon which
the determination is based; and
(c) With specific reference to the
rules applicable to originating goods as
set forth in General Note 30, HTSUS,
and in §§ 10.809 through 10.817 of this
subpart, the legal basis for the determination.
PENALTIES
§ 10.826 Violations
BFTA.

relating

to

All criminal, civil, or administrative
penalties which may be imposed on
U.S. importers for violations of the
customs and related laws and regulations will also apply to U.S. importers
for violations of the laws and regulations relating to the BFTA.

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§ 10.827

19 CFR Ch. I (4–1–11 Edition)

GOODS RETURNED AFTER REPAIR OR
ALTERATION
§ 10.827 Goods re-entered after repair
or alteration in Bahrain.
(a) General. This section sets forth
the rules that apply for purposes of obtaining duty-free treatment on goods
returned after repair or alteration in
Bahrain as provided for in subheadings
9802.00.40 and 9802.00.50, HTSUS. Goods
returned after having been repaired or
altered in Bahrain, whether or not pursuant to a warranty, are eligible for
duty-free treatment, provided that the
requirements of this section are met.
For purposes of this section, ‘‘repairs or
alterations’’ means restoration, addition, renovation, re-dyeing, cleaning,
re-sterilizing, or other treatment
which does not destroy the essential
characteristics of, or create a new or
commercially different good from, the
good exported from the United States.
(b) Goods not eligible for treatment. The
duty-free treatment referred to in
paragraph (a) of this section will not
apply to goods which, in their condition as exported from the United
States to Bahrain, are incomplete for
their intended use and for which the
processing operation performed in Bahrain constitutes an operation that is
performed as a matter of course in the
preparation or manufacture of finished
goods.
(c) Documentation. The provisions of
paragraphs (a), (b), and (c) of § 10.8 of
this part, relating to the documentary
requirements for goods entered under
subheading 9802.00.40 or 9802.00.50,
HTSUS, will apply in connection with
the entry of goods which are returned
from Bahrain after having been exported for repairs or alterations and
which are claimed to be duty free.

Subpart O—Haitian Hemispheric
Opportunity through Partnership Encouragement Act of
2006
SOURCE: CBP Dec. 07–43, 72 FR 34369, June
22, 2007, unless otherwise noted.

§ 10.841

Applicability.

Title V of Public Law 109–432, entitled the Haitian Hemispheric Oppor-

tunity through Partnership Encouragement Act of 2006 (HOPE I Act), amended the Caribbean Basin Economic Recovery Act (the CBERA, 19 U.S.C. 2701–
2707) by adding a new section 213A (19
U.S.C. 2703A) to authorize the President to extend additional trade benefits to Haiti. part I, Subtitle D, Title
XV of Public Law 110–234, entitled the
Haitian
Hemispheric
Opportunity
through Partnership Encouragement
Act of 2008 (HOPE II Act) amended certain provisions within section 213A.
Section 213A of the CBERA provides for
the duty-free treatment of certain apparel articles and certain wiring sets
from Haiti. The provisions of this subpart set forth the legal requirements
and procedures that apply for purposes
of obtaining duty-free treatment pursuant to CBERA section 213A.
[CBP Dec. 08-24, 73 FR 56725, Sept. 30, 2008]

§ 10.842

Definitions.

As used in this subpart, the following
terms have the meanings indicated unless either the context in which they
are used requires a different meaning
or a different definition is prescribed
for a particular section of this subpart:
(a) Apparel articles. ‘‘Apparel articles’’
means goods classifiable in Chapters 61
and 62 and headings 6501, 6502, 6503, and
6504 and subheadings 6406.99.15 and
6505.90 of the HTSUS;
(b) Applicable one-year period. ‘‘Applicable one-year period’’ means each of
the following one-year periods:
(1) Initial applicable one-year period.
‘‘Initial applicable one-year period’’
means the period beginning on December 20, 2006, and ending on December 19,
2007;
(2) Second applicable one-year period.
‘‘Second applicable one-year period’’
means the period beginning on December 20, 2007, and ending on December 19,
2008;
(3) Third applicable one-year period.
‘‘Third applicable one-year period’’
means the period beginning on December 20, 2008, and ending on December 19,
2009;
(4) Fourth applicable one-year period.
‘‘Fourth applicable one-year period’’
means the period beginning on December 20, 2009, and ending on December 19,
2010; and

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U.S. Customs and Border Protection, DHS; Treasury
(5) Fifth applicable one-year period.
‘‘Fifth applicable one-year period’’
means the period beginning on December 20, 2010, and ending on December 19,
2011;
(c) Customs territory of the United
States. ‘‘Customs territory of the United
States’’ means the 50 states, the District of Columbia, and Puerto Rico;
(d) Declared customs value. ‘‘Declared
customs value’’ means the appraised
value of an imported article determined in accordance with section 402 of
the Tariff Act of 1930, as amended (19
U.S.C. 1401a);
(e) Enter; entry. ‘‘Enter’’ and ‘‘entry’’
refer to the entry, or withdrawal from
warehouse for consumption, in the customs territory of the United States;
(f) Entity controlling production. ‘‘Entity controlling production’’ means an
individual, corporation, partnership,
association, or other entity or group
that is not a producer and that controls the production process in Haiti
through a contractual relationship or
other indirect means;
(g) Fabric component. ‘‘Fabric component’’ means a component cut from fabric to the shape or form of the component as it is used in the apparel article;
(h) Foreign material. ‘‘Foreign material’’ means a material not produced in
Haiti or any eligible country described
in § 10.844(c);
(i) HTSUS. ‘‘HTSUS’’ means the Harmonized Tariff Schedule of the United
States;
(j) Knit-to-shape articles. ‘‘Knit-toshape,’’ when used with reference to apparel articles, means any apparel article of which 50 percent or more of the
exterior surface area is formed by
major parts that have been knitted or
crocheted directly to the shape used in
the apparel article, with no consideration being given to patch pockets, appliques, or the like. Minor cutting,
trimming, or sewing of those major
parts will not affect the determination
of whether an apparel article is ‘‘knitto-shape’’;
(k) Knit-to-shape components. ‘‘Knitto-shape,’’ when used with reference to
textile components, means components
that are knitted or crocheted from a
yarn directly to a specific shape, that
is, the shape or form of the component
as it is used in the apparel article, con-

§ 10.842

taining at least one self-start edge.
Minor cutting or trimming will not affect the determination of whether a
component is ‘‘knit-to-shape’’;
(l) Major parts. ‘‘Major parts’’ means
integral components of an apparel article but does not include collars, cuffs,
waistbands, plackets, pockets, linings,
paddings, trim, accessories, or similar
parts or components;
(m) Producer. ‘‘Producer’’ means an individual, corporation, partnership, association, or other entity or group that
exercises direct, daily operational control over the production process in
Haiti;
(n) Self-start edge. ‘‘Self-start edge,’’
when used with reference to knit-toshape components, means a finished
edge which is finished as the component comes off the knitting machine.
Several components with finished
edges may be linked by yarn or thread
as they are produced from the knitting
machine;
(o) Subheading. ‘‘Subheading’’ means
the first six digits in the tariff classification number under the HTSUS;
(p) Wholly assembled in Haiti. ‘‘Wholly
assembled in Haiti’’ means that all
components, of which there must be at
least two, pre-existed in essentially the
same condition as found in the finished
good and were combined to form the
finished good in Haiti. Minor attachments and minor embellishments (for
example, applique´s, beads, spangles,
embroidery, and buttons) not appreciably affecting the identity of the
good, and minor subassemblies (for example, collars, cuffs, plackets, and
pockets), will not affect the determination of whether a good is ‘‘wholly assembled in Haiti’’.
(q) Wholly the growth, product, or manufacture. ‘‘Wholly the growth, product,
or manufacture,’’ when used with reference to Haiti or one or more eligible
countries described in § 10.844(c) of this
subpart, refers both to any article
which has been entirely grown, produced, or manufactured in Haiti or one
or more eligible countries described in
§ 10.844(c) of this subpart and to all materials incorporated in an article which
have been entirely grown, produced, or
manufactured in Haiti or one or more

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§ 10.843

19 CFR Ch. I (4–1–11 Edition)

eligible
countries
described
§ 10.844(c) of this subpart.

in

[CBP Dec. 07–43, 72 FR 34369, June 22, 2007, as
amended at CBP Dec. 08-24, 73 FR 56725, Sept.
30, 2008]

§ 10.843 Articles eligible for duty-free
treatment.
The duty-free treatment referred to
in § 10.841 of this subpart applies to the
articles described in paragraphs (a)
through (j) of this section that are imported directly from Haiti or the Dominican Republic into the customs territory of the United States and to the
articles described in paragraph (k) of
this section that are imported directly
from Haiti into the customs territory
of the United States.
(a) Certain apparel articles. Apparel
articles of a producer or entity controlling production that are wholly assembled or knit-to-shape in Haiti from any
combination of fabrics, fabric components, components knit-to-shape, and
yarns, subject to the applicable quantitative limits set forth in U.S. Note
6(g), Subchapter XX, Chapter 98,
HTSUS, and provided that the applicable value-content requirement set forth
in § 10.844(a) of this subpart is met
through the use of:
(1) The individual entry method (see
§ 10.844(a)(1) of this subpart); or
(2) The annual aggregation method
(see § 10.844(a)(2) of this subpart).
(b) Certain woven apparel articles. Apparel articles classifiable in Chapter 62
of the HTSUS that are wholly assembled or knit-to-shape in Haiti from any
combination of fabrics, fabric components, components knit-to-shape, and
yarns, without regard to the source of
the fabric, fabric components, components knit-to-shape, or yarns from
which the article is made, subject to
the applicable quantitative limits set
forth in U.S. Note 6(h), Subchapter XX,
Chapter 98, HTSUS.
(c) Brassieres. Apparel articles classifiable in subheading 6212.10 of the
HTSUS that are wholly assembled or
knit-to-shape in Haiti from any combination of fabrics, fabric components,
components knit-to-shape, or yarns,
without regard to the source of the fabric, fabric components, components
knit-to-shape, or yarns from which the
article is made.

(d) Certain knit apparel articles—(1)
General. Apparel articles classifiable in
Chapter 61 of the HTSUS (other than
those described in paragraph (d)(2) of
this section) that are wholly assembled
or knit-to-shape in Haiti from any
combination of fabrics, fabric components, components, components knitto-shape, or yarns, without regard to
the source of the fabric, fabric components, components knit-to-shape, or
yarns from which the article is made,
subject to the applicable quantitative
limits set forth in U.S. Note 6(j), Subchapter XX, Chapter 98, HTSUS.
(2) Exclusions. Duty-free treatment
for the articles described in paragraph
(d)(1) of this section will not apply to
the following:
(i) The following apparel articles of
cotton, for men or boys, that are classifiable in subheading 6109.10.00 of the
HTSUS:
(A) All white T-shirts, with short
hemmed sleeves and hemmed bottom,
with crew or round neckline or with Vneck and with a mitered seam at the
center of the V, and without pockets,
trim, or embroidery;
(B) All white singlets, without pockets, trim, or embroidery; and
(C) Other T-shirts, but not including
thermal undershirts;
(ii) T-shirts for men or boys that are
classifiable in subheading 6109.90.10 of
the HTSUS;
(iii) The following apparel articles of
cotton, for men or boys, that are classifiable in subheading 6110.20.20 of the
HTSUS:
(A) Sweatshirts; and
(B) Pullovers, other than sweaters,
vests, or garments imported as part of
playsuits; or
(iv) Sweatshirts for men or boys, of
man-made fibers and containing less
than 65 percent by weight of man-made
fibers, that are classifiable in subheading 6110.30.30 of the HTSUS.
(e) Other apparel articles. Any of the
following apparel articles that is wholly assembled or knit-to-shape in Haiti
from any combination of fabrics, fabric
components,
components
knit-toshape, or yarns, without regard to the
source of the fabric, fabric components,
components knit-to-shape, or yarns
from which the article is made:

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U.S. Customs and Border Protection, DHS; Treasury
(1) Any apparel article that is of a
type listed in chapter rule 3, 4, or 5 for
chapter 61 of the HTSUS (as such chapter rules are contained in section A of
the Annex to Presidential Proclamation 8213 of December 20, 2007) as being
excluded from the scope of such chapter rule, when such chapter rule is applied to determine whether an apparel
article is an originating good for purposes of General Note 29(n), HTSUS,
except that, for purposes of this provision, reference in such chapter rules to
subheading 6104.12.00 of the HTSUS is
deemed to refer to subheading 6104.19.60
of the HTSUS; or
(2) Any apparel article (other than
articles to which paragraph (c) of this
section applies (brassieres)) that is of a
type listed in chapter rule 3(a), 4(a), or
5(a) for chapter 62 of the HTSUS, as
such chapter rules are contained in
paragraph 9 of section A of the Annex
to Presidential Proclamation 8213 of
December 20, 2007.
(f) Luggage and similar items. Articles
classifiable in subheading 4202.12,
4202.22, 4202.32, or 4202.92 of the HTSUS
that are wholly assembled in Haiti,
without regard to the source of the fabric, components, or materials from
which the article is made.
(g) Headgear. Articles classifiable in
heading 6501, 6502, or 6504, or subheading 6505.90 of the HTSUS that are
wholly assembled, knit-to-shape, or
formed in Haiti from any combination
of fabrics, fabric components, components knit-to-shape, or yarns, without
regard to the source of the fabric, fabric components, components knit-toshape, or yarns from which the article
is made.
(h) Certain sleepwear. Any of the following apparel articles that is wholly
assembled or knit-to-shape in Haiti
from any combination of fabrics, fabric
components,
components
knit-toshape, or yarns, without regard to the
source of the fabric, fabric components,
components knit-to-shape, or yarns
from which the article is made:
(1) Pajama bottoms and other
sleepwear for women and girls, of cotton, that are classifiable in subheading
6208.91.30, HTSUS, or of man-made fibers, that are classifiable in subheading 6208.92.00, HTSUS; or

§ 10.843

(2) Pajama bottoms and other
sleepwear for girls, of other textile materials, that are classifiable in subheading 6208.99.20, HTSUS.
(i) Earned import allowance rule. Apparel articles wholly assembled or
knit-to-shape in Haiti from any combination of fabrics, fabric components,
components knit-to-shape, or yarns,
without regard to the source of the fabric, fabric components, components
knit-to-shape, or yarns from which the
articles are made, if such apparel articles are accompanied by an earned import allowance certificate issued by the
Department of Commerce that reflects
the amount of credits equal to the
total square meter equivalents of such
apparel articles, in accordance with the
earned import allowance program established by the Secretary of Commerce
pursuant
to
19
U.S.C.
2703A(b)(4)(B).
(j) Apparel articles of short supply materials. Apparel articles that are wholly
assembled or knit-to-shape in Haiti
from any combination of fabrics, fabric
components,
components
knit-toshape, or yarns, without regard to the
source of the fabrics, fabric components, components knit-to-shape, or
yarns from which the article is made, if
the fabrics, fabric components, components knit-to-shape, or yarns comprising the component that determines
the tariff classification of the article
are of any of the following:
(1) Fabrics or yarns, to the extent
that apparel articles of such fabrics or
yarns would be eligible for preferential
treatment, without regard to the
source of the fabrics or yarns, under
Annex 401 of the North American Free
Trade Agreement (NAFTA); or
(2) Fabrics or yarns, to the extent
that such fabrics or yarns are designated as not being available in commercial quantities for purposes of:
(i) Section 213(b)(2)(A)(v) of the
CBERA (19 U.S.C. 2703(b)(2)(A)(v));
(ii) Section 112(b)(5) of the African
Growth and Opportunity Act (19 U.S.C.
3721(b)(5));
(iii) Section 204(b)(3)(B)(i)(III) or
204(b)(3)(B)(ii) of the Andean Trade
Preference
Act
(19
U.S.C.
3203(b)(3)(B)(i)(II) or 3203(b)(3)(B)(ii)); or

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§ 10.844

19 CFR Ch. I (4–1–11 Edition)

(iv) Any other provision, relating to
determining whether a textile or apparel article is an originating good eligible for preferential treatment, of a
law that implements a free trade agreement entered into by the United States
that is in effect at the time the claim
for preferential tariff treatment is
made under § 10.847 of this subpart.
(k) Wiring sets. Any article classifiable in subheading 8544.30.00 of the
HTSUS, as in effect on December 20,
2006, that is the product or manufacture of Haiti, provided the article satisfies the value-content requirement set
forth in § 10.844(b) of this subpart. For
purposes of this paragraph, the term
‘‘product or manufacture of Haiti’’ refers to an article that is either:
(1) Wholly the growth, product, or
manufacture of Haiti; or
(2) A new or different article of commerce that has been grown, produced,
or manufactured in Haiti.
[CBP Dec. 07–43, 72 FR 34369, June 22, 2007, as
amended at CBP Dec. 08-24, 73 FR 56725, Sept.
30, 2008]

§ 10.844

Value-content requirement.

(a) Certain apparel articles—(1) General. Except as provided in paragraph
(a)(2) of this section, apparel articles
described in § 10.843(a) of this subpart
will be eligible for duty-free treatment
only if, for each entry of such articles
in the applicable one-year period for
which a duty-free claim is made for
such articles under § 10.847(a) of this
subpart, the sum of the cost or value of
the materials produced in Haiti or one
or more eligible countries described in
paragraph (c) of this section, or any
combination thereof, plus the direct
costs of processing operations performed in Haiti or one or more eligible
countries described in paragraph (c) of
this section, or any combination thereof, is not less than (as applicable):
(i) 50 percent or more of the declared
customs value of the articles entered
during the initial applicable one-year
period, the second applicable one-year
period, and the third applicable oneyear period;
(ii) 55 percent or more of the declared
customs value of the articles entered
during the fourth applicable one-year
period; and

(iii) 60 percent or more of the declared customs value of the articles entered during the fifth applicable oneyear period.
(2) Annual aggregation—(i) Initial applicable one-year period. In the initial
applicable one-year period, the applicable value-content requirement set forth
in paragraph (a)(1) of this section may
also be met for apparel articles of a
producer or an entity controlling production that are entered during the initial applicable one-year period and for
which duty-free treatment is claimed
under § 10.847(a) of this subpart by aggregating the cost or value of materials and the direct costs of processing
operations, as those terms are used in
paragraph (a)(1) of this section, with
respect to all apparel articles of that
producer or entity controlling production that are wholly assembled or knitto-shape in Haiti and are entered during the initial applicable one-year period (except as provided in paragraph
(a)(2)(iii) of this section).
(ii) Other applicable one-year periods.
In each of the second, third, fourth,
and fifth applicable one-year periods,
the applicable value-content requirement set forth in paragraph (a)(1) of
this section may also be met for apparel articles of a producer or an entity
controlling production that are entered
during the applicable one-year period
and for which duty-free treatment is
claimed under § 10.847(a) of this subpart
by aggregating the cost or value of materials and the direct costs of processing, as those terms are used in paragraph (a)(1) of this section, with respect to all apparel articles of that producer or entity controlling production
that are wholly assembled or knit-toshape in Haiti and are entered during
the preceding applicable one-year period (except as provided in paragraph
(a)(2)(iii) of this section).
(iii) Exclusions from annual aggregation calculation. The entry of an apparel
article that is wholly assembled or
knit-to-shape in Haiti and is receiving
preferential tariff treatment under any
provision of law other than section
213A(b)(1) of the CBERA (19 U.S.C.
2703A(b)(1)) or is subject to the ‘‘General’’ subcolumn of column 1 of the
HTSUS will only be included in an annual aggregation under paragraph

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U.S. Customs and Border Protection, DHS; Treasury
(a)(2)(i) or (a)(2)(ii) of this section if the
producer or entity controlling production elects, at the time the annual aggregation calculation is made, to include such entry in the aggregation.
Example. A Haitian producer elects to use
the annual aggregation method in the initial
applicable one-year period, and also elects to
include in the aggregation calculation an
entry of apparel articles receiving preferential tariff treatment under another preference program. The producer ships to the
United States four shipments during the initial applicable one-year period and all are
entered during that period. The first shipment of apparel (qualifying for and receiving
preference under the Caribbean Basin Trade
Partnership Act (CBTPA)) has an appraised
value of $100,000 and meets a value-content
percentage (under § 10.844(a) of this section)
of 80%. The second shipment of apparel is
wholly assembled in Haiti, has an appraised
value of $100,000, and meets a value-content
percentage of 40%. The third shipment is
wholly assembled in Haiti, has an appraised
value of $50,000, and meets a value-content
percentage of 0%. The last shipment is wholly assembled in Haiti, has an appraised value
of $20,000, and meets a value-content requirement of 80%. Taken together, the four shipments have an appraised value of $270,000 and
meet a value-content percentage of 50.4%.
The apparel articles shipped to the United
States in the last three shipments would
qualify for duty-free treatment under section
213A(b)(1) of the CBERA and § 10.843(a) of this
subpart as the applicable value-content requirement for the initial applicable one-year
period (50 %) is satisfied. This conclusion assumes that: The CBTPA-eligible apparel articles in the first shipment (that were included in the annual aggregation calculation
at the election of the producer) were wholly
assembled or knit-to-shape in Haiti, as required in § 10.844(a)(2)(iii) of this section; and
the articles in the last three shipments that
were wholly assembled in Haiti satisfy all
other applicable requirements set forth in
this subpart.

(3) Election to use the annual aggregation method for an applicable one-year
period. A producer or entity controlling
production may elect to use the individual entry or annual aggregation
method in any applicable one-year period and then elect to use the other
method during the subsequent applicable one-year period, provided that all
applicable requirements are met during
the applicable one-year period preceding the period in which the switch
is made. If a producer or entity controlling production using the indi-

§ 10.844

vidual entry method in an applicable
one-year period elects to use the annual aggregation method during the
subsequent applicable one-year period,
the declaration of compliance described in § 10.848 of this subpart must
be submitted to CBP within 30 days following the end of the applicable oneyear period in which the individual
entry method was used.
(4) Failure to meet applicable requirements—(i) Initial applicable one-year period. Except as provided in paragraph
(a)(4)(iii) of this section, if CBP determines that apparel articles of a producer or entity controlling production
that are entered as articles described
in § 10.843(a) of this subpart during the
initial applicable one-year period have
not met the requirements of § 10.843(a)
of this subpart or the applicable valuecontent requirement set forth in paragraph (a)(1) of this section, then:
(A) All apparel articles of the producer or entity controlling production
for which duty-free treatment is
claimed under § 10.847(a) of this subpart
that are entered under the annual aggregation method during that initial
applicable one-year period will be denied duty-free treatment;
(B) Those apparel articles of the producer or entity controlling production
for which duty-free treatment is
claimed under § 10.847(a) of this subpart
that are entered on an individual entry
basis and that fail to meet the requirements of § 10.843(a)(1) of this subpart or
the applicable value-content requirement set forth in paragraph (a)(1) of
this section during that initial applicable one-year period will be denied dutyfree treatment. However, apparel articles of the producer or entity controlling production for which duty-free
treatment is claimed under § 10.847(a) of
this subpart that are entered on an individual entry basis prior to an election being made by the producer or entity controlling production to use the
annual aggregation method will be considered to have met the applicable
value-content requirement if that requirement is met through application
of the individual entry method; and
(C) All apparel articles of the producer or entity controlling production
for which duty-free treatment is

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§ 10.844

19 CFR Ch. I (4–1–11 Edition)

claimed under § 10.847(a) of this subpart, whether entered on an individual
entry or annual aggregation basis, will
be not be eligible for duty-free treatment during the succeeding applicable
one-year periods until the increased
percentage in the value-content requirement specified in paragraph
(a)(4)(iii) of this section has been met
by all the apparel articles of that producer or entity controlling production
that are wholly assembled or knit-toshape in Haiti and are entered during
the immediately preceding applicable
one-year period, unless the articles
qualify for tariff benefits pursuant to
the provisions of § 10.845 of this subpart.
(ii) Other applicable one-year periods.
Except as provided in paragraph
(a)(4)(iii) of this section, if CBP determines that apparel articles of a producer or entity controlling production
that are entered as articles described
in § 10.843(a) of this subpart during any
applicable one-year period following
the initial applicable one-year period
have not met the requirements of
§ 10.843(a) or the applicable value-content requirement set forth in paragraph (a) of this section, then:
(A) Those apparel articles of the producer or entity controlling production
for which duty-free treatment is
claimed under § 10.847(a) of this subpart
that are entered on an individual entry
basis and that fail to meet the requirements of § 10.843(a)(1) or the applicable
value-content requirement set forth in
paragraph (a)(1) of this subpart during
that applicable one-year period will be
denied duty-free treatment; and
(B) All apparel articles of the producer or entity controlling production
for which duty-free treatment is
claimed under § 10.847(a) of this subpart, whether entered on an individual
entry or annual aggregation basis, will
not be eligible for duty-free treatment
during the succeeding applicable oneyear periods until the increased percentage in the value-content requirement specified in paragraph (a)(4)(iii)
of this section has been met by all the
apparel articles of that producer or entity controlling production that are
wholly assembled or knit-to-shape in
Haiti and are entered during the immediately preceding applicable one-year

period, unless the articles qualify for
tariff benefits pursuant to the provisions of § 10.845 of this subpart.
(iii) Entity controlling production of
apparel articles of a producer also producing for its own account. Where an entity controlling production controls
the production of apparel articles, as
described in § 10.843(a) of this subpart,
of a producer that also produces for its
own account, the failure of apparel articles of that producer to meet the requirements of § 10.843(a) of this subpart
or the applicable value-content requirement set forth in paragraph (a) of
this section in an applicable one-year
period, either under the annual aggregation method or the individual entry
method, will not affect the eligibility
for duty-free treatment under § 10.843(a)
of this subpart of those apparel articles
of that producer which are part of a
claim for such treatment made on behalf of the entity controlling production.
Example. Importer D, an entity controlling
production, purchases apparel articles that
meet the description in § 10.843(a) of this subpart from Haitian Producers A, B, and C and
enters those articles during the initial applicable one-year period. Importer D elects to
use the annual aggregation method during
that period. The three producers also
produce apparel for other U.S. importers and
each producer elects to use the annual aggregation method. The apparel articles purchased by Importer D from the three producers and entered during the initial applicable one-year period meet a value-content
percentage of 51.7%. However, the value-content percentage met by all the apparel that
is wholly assembled in Haiti by Producer C
and entered (including the apparel imported
by Importer D) during the initial applicable
one-year period is 49%. As all of the articles,
in the aggregate, purchased by Importer D
from the three producers and entered during
the initial applicable one-year period satisfy
the applicable value-content requirement
(50%), all of these articles are entitled to
duty-free treatment under section 213A(b)(1)
of the CBERA and § 10.843(a) of this subpart,
assuming all other applicable requirements
are met. The failure of Producer C to meet
the 50% value-content requirement with respect to all of the articles that it wholly assembled in Haiti and entered during the initial applicable one-year period will not prevent duty-free status being claimed for the

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U.S. Customs and Border Protection, DHS; Treasury
articles purchased by Importer D from Producer C. Therefore, the consequences of Producer C’s failure to meet the 50% value-content requirement include the denial of preferential tariff treatment for all articles that
are wholly assembled in Haiti by Producer C
and entered during the initial applicable
one-year period, except for those articles sold
by Producer C to Importer D. An additional
consequence of Producer C’s failure to meet
the value-content requirement in the initial
applicable one-year period is that articles
wholly assembled in Haiti by Producer C and
entered during succeeding applicable oneyear periods will be ineligible for duty-free
treatment until the appropriate increased
value-content requirement has been met (see
§ 10.844(a)(4)(i)(C) of this subpart), except to
the extent the articles qualify for preference
under § 10.845 of this subpart.

(iv) Increased percentage. For apparel
articles of a producer or entity controlling production to meet the increased
percentage referred to in paragraphs
(a)(4)(i)(C) and (a)(4)(ii)(B) of this section, the sum of the cost or value of
the materials produced in Haiti or one
or more eligible countries described in
paragraph (c) of this section, or any
combination thereof, plus the direct
costs of processing operations performed in Haiti or one or more eligible
countries described in paragraph (c) of
this section, or any combination thereof, must not be less than the applicable
percentage under paragraph (a)(1) of
this section, plus 10 percent, of the aggregate declared customs value of all
apparel articles of that producer or entity controlling production that are
wholly assembled or knit-to-shape in
Haiti and are entered during the immediately preceding applicable one-year
period. Once the increased value-content percentage has been met for the
articles of a producer or entity controlling production that are entered during
an applicable one-year period, the articles of that producer or entity controlling production that are entered during
the next succeeding applicable oneyear period will be subject to the applicable value-content percentage specified in paragraph (a)(1) of this section.
(v) Articles of a new producer or entity
controlling production. Apparel articles
of a new producer or entity controlling
production electing to use the annual
aggregation method for purposes of
meeting the applicable value-content
requirement must first meet the in-

§ 10.844

creased value-content percentage specified in paragraph (a)(4)(iv) of this section as a prerequisite to receiving
duty-free treatment during a succeeding applicable one-year period. Apparel articles of a new producer or entity controlling production electing to
use the individual entry method are
not subject to the requirement of first
meeting the increased value-content
percentage as a prerequisite to receiving duty-free treatment during the
first year of participation or in any
succeeding applicable one-year period.
For purposes of this paragraph, a ‘‘new
producer or entity controlling production’’ is a producer or entity controlling production that did not produce or
control production of articles that
were entered as articles pursuant to
§ 10.843(a) of this subpart during the immediately preceding applicable oneyear period.
Example 1. A Haitian producer begins production of apparel articles that meet the description in § 10.843(a) of this subpart during
the second applicable one-year period and
elects to use the annual aggregation method
for each applicable one-year period. The producer’s articles entered during the second
applicable one-year period meet a value-content percentage of 55%; articles entered during the third applicable one-year period meet
a value-content percentage of 65%; and articles entered during the fourth applicable
one-year period meet a value-content percentage of 55%. The producer’s articles may
not receive duty-free treatment during the
second applicable one-year period because
there was no production (and thus no entered
articles) during the immediately preceding
period (the initial applicable one-year period) on which to assess compliance with the
applicable value-content requirement. The
producer’s articles also may not receive
duty-free treatment during the third applicable one-year period because the increased
value-content percentage requirement (50%
plus 10% = 60%) was not met in the immediately preceding period (the second applicable one-year period). However, the producer’s
articles are eligible for duty-free treatment
during the fourth applicable one-year period
based on compliance with the 60% value-content percentage requirement in the immediately preceding period (the third applicable
one-year period). The producer’s articles also
are eligible for duty-free treatment during
the fifth applicable one-year period based on
compliance with the 55% value-content percentage requirement in the immediately preceding period (the fourth applicable one-year
period).

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§ 10.844

19 CFR Ch. I (4–1–11 Edition)

Example 2. Same facts as in example 1, except that the producer elects to use the individual entry method for purposes of meeting
the applicable value-content requirement for
each applicable one-year period. The producer’s articles entered during the second
applicable one-year period are eligible for
duty-free treatment because these articles
meet the requisite 50% value-content requirement. The producer’s articles also may
receive duty-free treatment during the third,
fourth, and fifth applicable one-year periods
based on compliance with the applicable
value-content requirements for each of those
periods set forth in paragraph (a)(1) of this
section.

(vi) Notification of compliance with the
increased percentage—(A) General. If apparel articles of a producer or entity
controlling production are required to
meet the increased value-content percentage
described
in
paragraph
(a)(4)(iv) of this section, either because
of failure to meet the requirements of
§ 10.843(a) or the applicable value-content requirement set forth in paragraph (a) of this section in an applicable one-year period, or because the producer or entity controlling production
is a new producer or entity controlling
production, as defined in paragraph
(a)(4)(v) of this section, that elects to
use the annual aggregation method,
the importer of such articles must notify CBP that the increased percentage
has been met in an applicable one-year
period by submitting to CBP the declaration of compliance described in
§ 10.848 of this subpart within 30 days
following the end of the applicable oneyear period. An importer that is required to submit a declaration of compliance under this paragraph must submit such a declaration for each importer of record identification number
used by that importer. A declaration of
compliance required under this paragraph must be sent to the address set
forth in § 10.848(a) of this subpart.
(B) Contents. A declaration of compliance
required
under
paragraph
(a)(4)(v)(A) of this section must include, in addition to the information
specified in § 10.848(c) of this subpart, a
statement as to whether the increased
value-content percentage was required
because the apparel articles failed to
meet the production standards or the
applicable value-content requirement
or because the producer or entity controlling production was a new producer

or entity controlling production that
elected to use the annual aggregation
method.
(C) Effect of noncompliance. If an importer fails to submit to CBP the declaration of compliance required under
paragraph (a)(4)(v)(A) of this section
within 30 days following the end of the
applicable one-year period during
which the increased value-content percentage was met for apparel articles of
a producer or entity controlling production, CBP may deny duty-free
treatment to all apparel articles, as described in § 10.843(a) of this subpart, of
that producer or entity controlling
production that are entered by that
importer during the next succeeding
applicable one-year period. Additionally, the timely submission of a declaration of compliance is a prerequisite
for a producer or entity controlling
production to request retroactive application of duty-free treatment under
§ 10.845 of this subpart for apparel articles that meet the increased value-content percentage during an applicable
one-year period. However, the submission of a declaration of compliance is
not a substitute for filing a request for
liquidation or reliquidation of an entry
for which retroactive duty-free treatment is sought under § 10.845 of this
subpart.
(5) Inclusion of the cost of fabrics or
yarns not available in commercial quantities in value-content requirement. For
purposes of meeting the applicable
value-content requirement set forth in
paragraph (a) of this section, either in
regard to individual entries or entries
entered in the aggregate, the following
costs may be included:
(i) The cost of fabrics or yarns to the
extent that apparel articles of such
fabrics or yarns would be eligible for
preferential treatment, without regard
to the source of the fabrics or yarns,
under Annex 401 of the NAFTA; and
(ii) The cost of fabrics or yarns (without regard to their source) that are
designated as not being available in
commercial quantities for purposes of:
(A) Section 213(b)(2)(A)(v) of the
CBERA (19 U.S.C. 2703(b)(2)(A)(v));
(B) Section 112(b)(5) of the African
Growth and Opportunity Act (19 U.S.C.
3721(b)(5));

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U.S. Customs and Border Protection, DHS; Treasury
(C) Section 204(b)(3)(B)(i)(III) or
204(b)(3)(B)(ii) of the Andean Trade
Preference
Act
(19
U.S.C.
3203(b)(3)(B)(i)(III) or 3203(b)(3)(B)(ii));
or
(D) Any other provision, relating to
determining whether a textile or apparel article is an originating good eligible for preferential treatment, of a
law that implements a free trade agreement that enters into force with respect to the United States.
(b) Wiring sets. An article described in
§ 10.843(d) of this subpart will be eligible for duty-free treatment during the
five-year period ending on December
19, 2011, only if the sum of the cost or
value of the materials produced in
Haiti or one or more eligible countries
described in paragraph (c) of this section, or any combination thereof, plus
the direct costs of processing operations performed in Haiti or the United
States, or both, is not less than 50 percent of the declared customs value of
the article.
(c) Eligible countries described. As used
in this section, the term ‘‘eligible countries’’ includes:
(1) The United States;
(2) Israel, Canada, Mexico, Jordan,
Singapore, Chile, Australia, Morocco,
Bahrain, El Salvador, Honduras, Nicaragua, Guatemala, Dominican Republic, and any other country that is a
party to a free trade agreement with
the United States that is in effect on
December 20, 2006, or that enters into
force thereafter; and
(3) The designated beneficiary countries listed in General Notes 11 (Andean
Trade Preference Act), 16 (African
Growth and Opportunity Act), and 17
(Caribbean Basin Trade Partnership
Act) of the HTSUS.
(d) Cost or value of materials—(1) Materials produced in Haiti or one or more eligible countries described in paragraph (c)
of this section defined—(i) Certain apparel articles. As used in paragraph (a)
of this section, the words ‘‘materials
produced in Haiti or one or more eligible countries described in paragraph (c)
of this section’’ refer to those materials
incorporated into an article that are
either:
(A) Wholly obtained or produced,
within the meaning of § 102.1(g) of this
chapter, in Haiti or one or more eligi-

§ 10.844

ble countries described in paragraph (c)
of this section; or
(B) Determined to originate in Haiti
or one or more eligible countries described in paragraph (c) of this section
by application of the provisions of
§ 102.21 of this chapter.
(ii) Wiring sets. As used in paragraph
(b) of this section, the words ‘‘materials
produced in Haiti or one or more eligible countries described in paragraph (c)
of this section’’ refer to those materials
incorporated into an article that are
either:
(A) Wholly the growth, product, or
manufacture of Haiti or one or more eligible countries described in paragraph
(c) of this section; or
(B) Substantially transformed in
Haiti or one or more eligible countries
described in paragraph (c) of this section into a new or different article of
commerce which is then used in Haiti
in the production of a new or different
article of commerce that is imported
into the United States.
(2) Determination of cost or value of
materials—(i) Costs included. (A) For
purposes of paragraphs (a) and (b) of
this section, and subject to paragraphs
(d)(2)(i)(B) and (d)(2)(ii) of this section,
the cost or value of materials produced
in Haiti or one or more eligible countries described in paragraph (c) of this
section includes:
(1) The manufacturer’s actual cost
for the materials;
(2) When not included in the manufacturer’s actual cost for the materials,
the freight, insurance, packing, and all
other costs incurred in transporting
the materials to the manufacturer’s
plant;
(3) The actual cost of waste or spoilage, less the value of recoverable scrap;
and
(4) Taxes and/or duties imposed on
the materials by Haiti or one or more
eligible countries described in paragraph (c) of this section, provided they
are not remitted upon exportation.
(B) Where a material is provided to
the manufacturer without charge, or at
less than fair market value, its cost or
value will be determined by computing
the sum of:
(1) All expenses incurred in the
growth, production, or manufacture of

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§ 10.845

19 CFR Ch. I (4–1–11 Edition)

the material, including general expenses;
(2) An amount for profit; and
(3) Freight, insurance, packing, and
all other costs incurred in transporting
the material to the manufacturer’s
plant.
(ii) Costs deducted in regard to certain
apparel articles. For purposes of paragraph (a) of this section, in calculating
the cost or value of materials produced
in Haiti or one or more eligible countries described in paragraph (c) of this
section, either in regard to individual
entries or entries entered in the aggregate, deductions are to be made for the
cost or value of:
(A) Any foreign materials used in the
production of the apparel articles in
Haiti; and
(B) Any foreign materials used in the
production of the materials produced
in Haiti or one or more eligible countries described in paragraph (c) of this
section.
(e) Direct costs of processing operations—(1) Items included. As used in
paragraphs (a) and (b) of this section,
the words ‘‘direct costs of processing
operations’’ mean those costs either directly incurred in, or which can be reasonably allocated to, the growth, production, manufacture, or assembly of
the specific articles under consideration. Such costs include, but are not
limited to the following, to the extent
that they are includable in the appraised value of the imported articles:
(i) All actual labor costs involved in
the growth, production, manufacture,
or assembly of the specific articles, including fringe benefits, on-the-job
training, and the cost of engineering,
supervisory, quality control, and similar personnel;
(ii) Dies, molds, tooling, and depreciation on machinery and equipment
which are allocable to the specific articles;
(iii) Research, development, design,
engineering, and blueprint costs insofar as they are allocable to the specific
articles; and
(iv) Costs of inspecting and testing
the specific articles.
(2) Items not included. The words ‘‘direct costs of processing operations’’ do
not include items that are not directly
attributable to the articles under con-

sideration or are not costs of manufacturing the product. These include, but
are not limited to:
(i) Profit; and
(ii) General expenses of doing business that either are not allocable to
the specific articles or are not related
to the growth, production, manufacture, or assembly of the articles, such
as administrative salaries, casualty
and liability insurance, advertising,
and salesmen’s salaries, commissions,
or expenses.
[CBP Dec. 07–43, 72 FR 34369, June 22, 2007, as
amended at CBP Dec. 08-24, 73 FR 56728, Sept.
30, 2008]

§ 10.845 Retroactive
application
of
duty-free treatment for certain apparel articles.
(a)
General.
Notwithstanding
19
U.S.C. 1514 or any other provision of
law, if apparel articles, as described in
§ 10.843(a) of this subpart, of a producer
or entity controlling production are ineligible for duty-free treatment in an
applicable one-year period because the
apparel articles of the producer or entity controlling production did not meet
the requirements of § 10.843(a) of this
subpart or the applicable value-content
requirement set forth in § 10.844(a) of
this subpart, and the apparel articles of
the producer or entity controlling production satisfy the increased valuecontent percentage set forth in
§ 10.844(a)(4)(iii) of this subpart in that
same applicable one-year period, the
entry of any such articles made during
that applicable one-year period will be
liquidated or reliquidated free of duty,
and CBP will refund any customs duties paid with respect to such entry,
with interest accrued from the date of
entry, provided that the conditions and
requirements set forth in paragraph (b)
of this section are met.
(b) Conditions and requirements. The
conditions and requirements referred
to in paragraph (a) of this section are
as follows:
(1) The articles in such entry would
have received duty-free treatment if
they had satisfied the requirements of
§ 10.843(a) and the applicable value-content requirement set forth in § 10.844(a)
of this subpart;
(2) A declaration of compliance with
the increased value-content percentage

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U.S. Customs and Border Protection, DHS; Treasury
is submitted to CBP within 30 days following the end of the applicable oneyear period during which the increased
percentage is met (see § 10.844(a)(4)(v) of
this subpart); and
(3) A request for liquidation or reliquidation with respect to such entry
is filed with CBP before the 90th day
after CBP determines and notifies the
importer that the apparel articles of
the producer or entity controlling production satisfy the increased valuecontent percentage set forth in
§ 10.844(a)(4)(iii) of this subpart during
that applicable one-year period.
Example. A Haitian producer of articles
that meet the description in § 10.843(a) of this
subpart begins exporting those articles to
the United States during the initial applicable one-year period and elects to use the annual aggregation method for purposes of
meeting the applicable value-content requirement. The articles entered during that
initial period meet a value-content percentage of 48%, while articles entered during the
second applicable one-year period meet a
value-content percentage of 62%. The producer’s articles may not receive duty-free
treatment during the initial applicable oneyear period because the requisite 50% valuecontent requirement was not met. The producer’s articles also are ineligible for dutyfree treatment during the second applicable
one-year period because the 50% value-content requirement was not met in the immediately preceding period (the initial applicable one-year period). However, because the
producer’s articles entered during the second
applicable one-year period satisfy the increased value-content percentage requirement (60%), the importer(s) of these articles
may file a request for and receive a refund of
the duties paid with respect to the articles
entered during that period, assuming compliance with the conditions and requirements
set forth in § 10.847 of this subpart. In addition, the producer’s articles entered during
the third applicable one-year period are eligible for duty-free treatment based on compliance with the increased value-content percentage in the second applicable one-year period.

§ 10.846 Imported directly.
(a) General. To be eligible for dutyfree treatment under this subpart, an
article must be imported directly from
Haiti into the customs territory of the
United States. For purposes of this requirement, the words ‘‘imported directly’’ mean:
(1) Direct shipment from Haiti to the
United States without passing through

§ 10.847

the territory of any intermediate country;
(2) If shipment is from Haiti to the
United States through the territory of
an intermediate country, the articles
in the shipment do not enter into the
commerce of the intermediate country
and the invoices, bills of lading, and
other shipping documents show the
United States as the final destination;
or
(3) If shipment is through an intermediate country and the invoices and
other documents do not show the
United States as the final destination,
the articles in the shipment are imported directly only if they:
(i) Remained under the control of the
customs authority in the intermediate
country;
(ii) Did not enter into the commerce
of the intermediate country except for
the purpose of a sale other than at retail, provided that the articles are imported as a result of the original commercial transaction between the importer and the producer or the producer’s sales agent; and
(iii) Have not been subjected to operations other than loading and unloading, and other activities necessary to
preserve the articles in good condition.
(b) Documentary evidence. An importer making a claim for duty-free
treatment under § 10.847 of this subpart
may be required to demonstrate, to
CBP’s satisfaction, that the articles
were ‘‘imported directly’’ as that term
is defined in paragraph (a) of this section. An importer may demonstrate
compliance with this section by submitting documentary evidence. Such
evidence may include, but is not limited to, bills of lading, airway bills,
packing lists, commercial invoices, receiving and inventory records, and customs entry and exit documents.
§ 10.847 Filing of claim for duty-free
treatment.
(a) General. An importer may make a
claim for duty-free treatment for an
article described in § 10.843 of this subpart by including on the entry summary, or equivalent documentation,
the applicable subheading within Subchapter XX of Chapter 98 of the HTSUS
under which the article is classified, or
by the method specified for equivalent

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§ 10.848

19 CFR Ch. I (4–1–11 Edition)

reporting via an authorized electronic
data interchange system. The applicable subheadings within Subchapter XX,
Chapter 98, HTSUS, are as follows:
(1) Subheading 9820.61.25 for apparel
articles described in § 10.843(a) of this
subpart for which the individual entry
method is used for purposes of meeting
the applicable value-content requirement set forth in § 10.844(a) of this subpart;
(2) Subheading 9820.61.30 for apparel
articles described in § 10.843(a) of this
subpart for which the annual aggregation method is used for purposes of
meeting the applicable value-content
requirement set forth in § 10.844(a) of
this subpart;
(3) Subheading 9820.62.05 for apparel
articles described in § 10.843(b) of this
subpart;
(4) Subheading 9820.62.12 for brassieres described in § 10.843(c) of this
subpart;
(5) Subheading 9820.61.35 for apparel
articles described in § 10.843(d) of this
subpart;
(6) Subheading 9820.61.40 for apparel
articles described in § 10.843(e) of this
subpart;
(7) Subheading 9820.42.05 for articles
described in § 10.843(f) of this subpart;
(8) Subheading 9820.65.05 for articles
described in § 10.843(g) of this subpart;
(9) Subheading 9820.62.20 for articles
described in § 10.843(h) of this subpart;
(10) Subheading 9820.62.25 for articles
described in § 10.843(i) of this subpart;
(11) Subheading 9820.62.30 for articles
described in § 10.843(j) of this subpart;
and
(12) Subheading 9820.85.44 for wiring
sets described in § 10.843(k) of this subpart.
(b) Restriction on claims submitted
under subheading 9820.61.30, HTSUS. An
importer may make a claim for dutyfree
treatment
under
subheading
9820.61.30, HTSUS, for apparel articles
described in § 10.843(a) of this subpart
for which the annual aggregation
method is used, only if the importer
has a copy of a certification by the producer or entity controlling production
setting forth its election to use the annual aggregation method for its articles (see § 10.848(c)(3) of this subpart). In
the absence of receipt of such certification from the producer or entity con-

trolling production, an importer of articles described in § 10.843(a) of this subpart for which duty-free treatment is
sought under this subpart must enter
the
articles
under
subheading
9820.61.25, HTSUS.
(c) Corrected claim. If, after making a
claim for duty-free treatment under
paragraph (a) of this section, the importer has reason to believe that the
claim is incorrect, the importer must
promptly make a corrected claim and
pay any duties that may be due. A corrected claim will be effected by submission of a letter or other written statement to the CBP port where the claim
was originally filed.
[CBP Dec. 07–43, 72 FR 34369, June 22, 2007, as
amended at CBP Dec. 08-24, 73 FR 56728, Sept.
30, 2008]

§ 10.848 Declaration of compliance.
(a) General. Each importer claiming
duty-free treatment for apparel articles, as described in § 10.843(a) of this
subpart, of a producer or entity controlling production that uses the annual aggregation method to satisfy the
applicable value-content requirement
set forth in § 10.844(a) of this subpart
with respect to the entries filed by the
importer during an applicable one-year
period must prepare and submit to CBP
a declaration of compliance with the
applicable value-content requirement
within 30 days following the end of the
applicable one-year period. An importer that is required to submit a declaration of compliance under this paragraph must submit such a declaration
for each importer of record identification number used by that importer.
The declaration of compliance must be
sent to: Office of International Trade,
1300 Pennsylvania Avenue, NW., Washington, DC 20229.
(b) Effect of noncompliance—(1) Initial
applicable one-year period. If an importer fails to submit to CBP the declaration of compliance required under
paragraph (a) of this section within 30
days following the end of the initial applicable one-year period, CBP may
deny duty-free treatment to all entries
of apparel articles, as described in
§ 10.843(a), of that producer or entity
controlling production that were filed
by that importer during the initial applicable one-year period and that are

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U.S. Customs and Border Protection, DHS; Treasury
entered by that importer during the
next succeeding applicable one-year period.
(2) Other applicable one-year periods. If
an importer fails to submit to CBP the
declaration of compliance required by
paragraph (a) of this section within 30
days following the end of any applicable one-year period (other than the initial applicable one-year period), CBP
may deny duty-free treatment to all
entries of apparel articles, as described
in § 10.843(a) of this subpart, of that
producer or entity controlling production that are entered by that importer
during the next succeeding applicable
one-year period.
(c) Contents. A declaration of compliance submitted to CBP under paragraph (a) of this section:
(1) Need not be in a prescribed format
but must be in writing or must be
transmitted electronically pursuant to
any electronic means authorized by
CBP for that purpose;
(2) Must include the following information:
(i) The applicable one-year period
during which the aggregation method
was used (year beginning December 20,
20l, year ending December 19, 20l);
(ii) The legal name, address, telephone, fax number, e-mail address (if
any), and identification number of the
importer of record, and the legal name,
telephone, and e-mail address (if any)
of the point of contact;
(iii) With respect to each entry for
which duty-free treatment is claimed
for apparel articles described in
§ 10.843(a) of this subpart and for which
the aggregation method is used, the
entry number, line number(s), port of
entry, and line value;
(iv) If the producer or entity controlling production elects to include in the
aggregation calculation entries of brassieres receiving duty-free treatment
under § 10.843(c) of this subpart and entries of apparel articles that are wholly
assembled or knit-to-shape in Haiti and
that are receiving preferential tariff
treatment under any provision of law
other than section 213A of the CBERA
or are subject to the rate of duty in the
‘‘General’’ subcolumn of column 1 of the
HTSUS (see § 10.844(a)(2)(iii)(B) and (C)
of this subpart), the entry number, line
number(s), port of entry, line value,

§ 10.849

name and address of the producer(s),
and, if applicable, name and address of
the entity controlling production;
(v) The value-content percentage
that was met during the applicable
one-year period with respect to each
producer or entity controlling production;
(vi) The name and title of the person
who prepared the declaration of compliance. The declaration must be prepared and signed by a responsible official of the importer or by the importer’s authorized agent having knowledge
of the relevant facts;
(vii) Signature of the person who prepared the declaration of compliance;
and
(viii) Date the declaration of compliance was prepared and signed; and
(3) Must include as an attachment to
the declaration a copy of a certification from each producer or entity
controlling production setting forth its
election to use the annual aggregation
method, a description of the classes or
kinds of apparel articles involved, and
the name and address of each producer
or entity controlling production.
§ 10.849

Importer obligations.

(a) General. An importer who makes a
claim for duty-free treatment under
§ 10.847 of this subpart for an article described in § 10.843 of this subpart:
(1) Will be deemed to have certified
that the article is eligible for duty-free
treatment under this subpart;
(2) Is responsible for the truthfulness
of the statements and information contained in the declaration of compliance, if that document is required to be
submitted
to
CBP
pursuant
to
§§ 10.844(a)(4)(v) or 10.848(a) of this subpart; and
(3) Is responsible for submitting any
supporting documents requested by
CBP and for the truthfulness of the information contained in those documents. When requested, CBP may arrange for the direct submission by the
exporter, producer, or entity controlling production of business confidential
or other sensitive information, including cost and sourcing information.
(b) Information provided by exporter,
producer, or entity controlling production.
The fact that the importer has made a

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§ 10.850

19 CFR Ch. I (4–1–11 Edition)

claim for duty-free treatment or prepared a declaration of compliance
based on information provided by an
exporter, producer, or entity controlling production will not relieve the importer of the responsibility referred to
in paragraph (a) of this section.
§ 10.850 Verification of claim for dutyfree treatment.
(a) General. A claim for duty-free
treatment made under § 10.847 of this
subpart, including any declaration of
compliance or other information submitted to CBP in support of the claim,
will be subject to whatever verification
CBP deems necessary. In the event
that CBP is provided with insufficient
information to verify or substantiate
the claim, including the statements
and information contained in a declaration of compliance (if required
under § 10.844(a)(4)(v) or § 10.848(a) of
this subpart), CBP may deny the claim
for duty-free treatment.
(b) Documentation and information
subject to verification. A verification of a
claim for duty-free treatment under
§ 10.847 of this subpart may involve, but
need not be limited to, a review of:
(1) All records required to be made,
kept, and made available to CBP by the
importer, the producer, the entity controlling production, or any other person under part 163 of this chapter; and
(2) The documentation and information set forth in paragraphs (b)(2)(i)
through (b)(2)(v) of this section, when
requested by CBP. This documentation
and information may be made available to CBP by the importer or the importer may arrange to have the documentation and information made available to CBP directly by the exporter,
producer, or entity controlling production:
(i) Documentation and other information regarding all apparel articles
that meet the requirements specified
in § 10.843(a) of this subpart that were
exported to the United States and that
were entered during the applicable oneyear period, whether or not a claim for
duty-free treatment was made under
§ 10.847 of this subpart. Those records
and other information include, but are
not limited to, work orders and other
production records, purchase orders,

invoices, bills of lading and other shipping documents;
(ii) Records to document the cost of
all yarn, fabric, fabric components, and
knit-to-shape components that were
used in the production of the articles
in question, such as purchase orders,
invoices, bills of lading and other shipping documents, and customs import
and clearance documents, work orders
and other production records, and inventory control records;
(iii) Records to document the direct
costs of processing operations performed in Haiti or one or more eligible
countries described in § 10.844(c) of this
subpart, such as direct labor and fringe
expenses, machinery and tooling costs,
factory expenses, and testing and inspection expenses that were incurred in
production;
(iv) Affidavits or statements of origin
that certify who manufactured the
yarn, fabric, fabric components and
knit-to-shape components. The affidavit or statement of origin should include a product description, name and
address of the producer, and the date
the articles were produced. An affidavit
for fabric components should state
whether or not subassembly operations
occurred; and
(v) Summary accounting and financial records which relate to the source
records provided for in paragraphs
(b)(2)(i) through (b)(2)(iii) of this section.

Subpart P—United States-Oman
Free Trade Agreement
SOURCE: CBP Dec. 11-01, 76 FR 701, Jan. 6,
2011, unless otherwise noted.

GENERAL PROVISIONS
§ 10.861

Scope.

This subpart implements the duty
preference and related customs provisions applicable to imported goods
under the United States-Oman Free
Trade Agreement (the OFTA) signed on
January 19, 2006, and under the United
States-Oman Free Trade Agreement
Implementation Act (the Act; 120 Stat.
1191). Except as otherwise specified in
this subpart, the procedures and other
requirements set forth in this subpart

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U.S. Customs and Border Protection, DHS; Treasury
are in addition to the customs procedures and requirements of general application contained elsewhere in this
chapter. Additional provisions implementing certain aspects of the OFTA
and the Act are contained in Parts 24,
162, and 163 of this chapter.
§ 10.862

General definitions.

As used in this subpart, the following
terms will have the meanings indicated
unless either the context in which they
are used requires a different meaning
or a different definition is prescribed
for a particular section of this subpart:
(a) Claim for preferential tariff treatment. ‘‘Claim for preferential tariff
treatment’’ means a claim that a good
is entitled to the duty rate applicable
under the OFTA to an originating good
or other good specified in the OFTA,
and to an exemption from the merchandise processing fee;
(b) Customs duty. ‘‘Customs duty’’ includes any customs or import duty and
a charge of any kind imposed in connection with the importation of a good,
including any form of surtax or surcharge in connection with such importation, but does not include any:
(1) Charge equivalent to an internal
tax imposed consistently with Article
III:2 of the GATT 1994, in respect of
like, directly competitive, or substitutable goods of the Party, or in respect of
goods from which the imported good
has been manufactured or produced in
whole or in part;
(2) Antidumping or countervailing
duty; and
(3) Fee or other charge in connection
with importation;
(c) Days. ‘‘Days’’ means calendar days;
(d) Enterprise. ‘‘Enterprise’’ means any
entity constituted or organized under
applicable law, whether or not for profit, and whether privately-owned or governmentally-owned or controlled, including any corporation, trust, partnership, sole proprietorship, joint venture, association, or similar organization;
(e) Foreign material. ‘‘Foreign material’’ means a material other than a
material produced in the territory of
one or both of the Parties;
(f) GATT 1994. ‘‘GATT 1994’’ means the
General Agreement on Tariffs and Trade

§ 10.862

1994, which is part of the WTO Agreement;
(g) Good. ‘‘Good’’ means any merchandise, product, article, or material;
(h) Harmonized System. ‘‘Harmonized
System (HS)’’ means the Harmonized
Commodity Description and Coding System, including its General Rules of Interpretation, Section Notes, and Chapter Notes, as adopted and implemented
by the Parties in their respective tariff
laws;
(i) Heading. ‘‘Heading’’ means the first
four digits in the tariff classification
number under the Harmonized System;
(j) HTSUS. ‘‘HTSUS’’ means the Harmonized Tariff Schedule of the United
States as promulgated by the U.S.
International Trade Commission;
(k) Originating. ‘‘Originating’’ means a
good qualifying under the rules of origin set forth in General Note 31,
HTSUS, and OFTA Chapter Three (Textiles and apparel) or Chapter Four
(Rules of Origin);
(l) Party. ‘‘Party’’ means the United
States or the Sultanate of Oman;
(m) Person. ‘‘Person’’ means a natural
person or an enterprise;
(n) Preferential tariff treatment. ‘‘Preferential tariff treatment’’ means the
duty rate applicable under the OFTA
to an originating good and an exemption from the merchandise processing
fee;
(o) Subheading. ‘‘Subheading’’ means
the first six digits in the tariff classification number under the Harmonized
System;
(p) Textile or apparel good. ‘‘Textile or
apparel good’’ means a good listed in
the Annex to the Agreement on Textiles and Clothing (commonly referred
to as ‘‘the ATC’’), which is part of the
WTO Agreement;
(q) Territory. ‘‘Territory’’ means:
(1) With respect to Oman, all the
lands of Oman within its geographical
boundaries, the internal waters, maritime areas including the territorial
sea, and airspace under its sovereignty,
and the exclusive economic zone and
continental shelf where Oman exercises
sovereign rights and jurisdiction in accordance with its domestic law and
international law, including the United
Nations Convention on the Law of the
Sea; and
(2) With respect to the United States,

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§ 10.863

19 CFR Ch. I (4–1–11 Edition)

(i) The customs territory of the
United States, which includes the 50
states, the District of Columbia, and
Puerto Rico,
(ii) The foreign trade zones located in
the United States and Puerto Rico, and
(iii) Any areas beyond the territorial
seas of the United States within which,
in accordance with international law
and its domestic law, the United States
may exercise rights with respect to the
seabed and subsoil and their natural resources; and
(r) WTO Agreement. ‘‘WTO Agreement’’
means the Marrakesh Agreement Establishing the World Trade Organization of
April 15, 1994.
IMPORT REQUIREMENTS
§ 10.863 Filing of claim for preferential
tariff treatment upon importation.
An importer may make a claim for
OFTA preferential tariff treatment for
an originating good by including on the
entry summary, or equivalent documentation, the symbol ‘‘OM’’ as a prefix
to the subheading of the HTSUS under
which each qualifying good is classified, or by the method specified for
equivalent reporting via an authorized
electronic data interchange system.
§ 10.864

Declaration.

(a) Contents. An importer who claims
preferential tariff treatment for a good
under the OFTA must submit to CBP,
at the request of the port director, a
declaration setting forth all pertinent
information concerning the growth,
production, or manufacture of the
good. A declaration submitted to CBP
under this paragraph:
(1) Need not be in a prescribed format
but must be in writing or must be
transmitted electronically pursuant to
any electronic means authorized by
CBP for that purpose;
(2) Must include the following information:
(i) The legal name, address, telephone, and e-mail address (if any) of
the importer of record of the good;
(ii) The legal name, address, telephone, and e-mail address (if any) of
the responsible official or authorized
agent of the importer signing the declaration (if different from the informa-

tion required by paragraph (a)(2)(i) of
this section);
(iii) The legal name, address, telephone and e-mail address (if any) of the
exporter of the good (if different from
the producer);
(iv) The legal name, address, telephone and e-mail address (if any) of the
producer of the good (if known);
(v) A description of the good, which
must be sufficiently detailed to relate
it to the invoice and HS nomenclature,
including quantity, numbers, invoice
numbers, and bills of lading;
(vi) A description of the operations
performed in the growth, production,
or manufacture of the good in territory
of one or both of the Parties and, where
applicable, identification of the direct
costs of processing operations;
(vii) A description of any materials
used in the growth, production, or
manufacture of the good that are wholly the growth, product, or manufacture
of one or both of the Parties, and a
statement as to the value of such materials;
(viii) A description of the operations
performed on, and a statement as to
the origin and value of, any materials
used in the article that are claimed to
have been sufficiently processed in the
territory of one or both of the Parties
so as to be materials produced in one
or both of the Parties, or are claimed
to have undergone an applicable
change in tariff classification specified
in General Note 31(h), HTSUS; and
(ix) A description of the origin and
value of any foreign materials used in
the good that have not been substantially transformed in the territory of
one or both of the Parties, or have not
undergone an applicable change in tariff classification specified in General
Note 31(h), HTSUS;
(3) Must include a statement, in substantially the following form: ‘‘I certify
that:
The information on this document is true
and accurate and I assume the responsibility
for proving such representations. I understand that I am liable for any false statements or material omissions made on or in
connection with this document;
I agree to maintain and present upon request, documentation necessary to support
these representations;

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U.S. Customs and Border Protection, DHS; Treasury
The goods comply with all the requirements for preferential tariff treatment specified for those goods in the United StatesOman Free Trade Agreement; and
This document consists of lll pages, including all attachments.’’

(b) Responsible official or agent. The
declaration must be signed and dated
by a responsible official of the importer or by the importer’s authorized
agent having knowledge of the relevant
facts.
(c) Language. The declaration must
be completed in the English language.
(d) Applicability of declaration. The
declaration may be applicable to:
(1) A single importation of a good
into the United States, including a single shipment that results in the filing
of one or more entries and a series of
shipments that results in the filing of
one entry; or
(2) Multiple importations of identical
goods into the United States that
occur within a specified blanket period,
not exceeding 12 months, set out in the
declaration. For purposes of this paragraph, ‘‘identical goods’’ means goods
that are the same in all respects relevant to the production that qualifies
the goods for preferential tariff treatment.
§ 10.865

Importer obligations.

(a) General. An importer who makes a
claim for preferential tariff treatment
under § 10.863 of this subpart:
(1) Will be deemed to have certified
that the good is eligible for preferential tariff treatment under the
OFTA;
(2) Is responsible for the truthfulness
of the information and data contained
in the declaration provided for in
§ 10.864 of this subpart; and
(3) Is responsible for submitting any
supporting documents requested by
CBP and for the truthfulness of the information contained in those documents. CBP will allow for the direct
submission by the exporter or producer
of business confidential or other sensitive information, including cost and
sourcing information.
(b) Information provided by exporter or
producer. The fact that the importer
has made a claim for preferential tariff
treatment or prepared a declaration
based on information provided by an

§ 10.867

exporter or producer will not relieve
the importer of the responsibility referred to in paragraph (a) of this section.
§ 10.866

Declaration not required.

(a) General. Except as otherwise provided in paragraph (b) of this section,
an importer will not be required to submit a declaration under § 10.864 of this
subpart for:
(1) A non-commercial importation of
a good; or
(2) A commercial importation for
which the value of the originating
goods does not exceed U.S. $2,500.
(b) Exception. If the port director determines that an importation described
in paragraph (a) of this section may
reasonably be considered to have been
carried out or planned for the purpose
of evading compliance with the rules
and procedures governing claims for
preference under the OFTA, the port
director will notify the importer that
for that importation the importer must
submit to CBP a declaration. The importer must submit such a declaration
within 30 days from the date of the notice. Failure to timely submit the declaration will result in denial of the
claim for preferential tariff treatment.
§ 10.867

Maintenance of records.

(a) General. An importer claiming
preferential tariff treatment for a good
under § 10.863 of this subpart must
maintain, for five years after the date
of the claim for preferential tariff
treatment, all records and documents
necessary for the preparation of the
declaration.
(b) Applicability of other recordkeeping
requirements. The records and documents referred to in paragraph (a) of
this section are in addition to any
other records required to be made,
kept, and made available to CBP under
Part 163 of this chapter.
(c) Method of maintenance. The
records and documents referred to in
paragraph (a) of this section must be
maintained by importers as provided in
§ 163.5 of this chapter.

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§ 10.868

19 CFR Ch. I (4–1–11 Edition)

§ 10.868 Effect of noncompliance; failure to provide documentation regarding transshipment.
(a) General. If the importer fails to
comply with any requirement under
this subpart, including submission of a
complete declaration under § 10.864 of
this subpart, when requested, the port
director may deny preferential tariff
treatment to the imported good.
(b) Failure to provide documentation regarding transshipment. Where the requirements for preferential tariff treatment set forth elsewhere in this subpart are met, the port director nevertheless may deny preferential treatment to a good if the good is shipped
through or transshipped in the territory of a country other than a Party,
and the importer of the good does not
provide, at the request of the port director, evidence demonstrating to the
satisfaction of the port director that
the good was imported directly from
the territory of a Party into the territory of the other Party (see § 10.880 of
this subpart).
POST-IMPORTATION DUTY REFUND
CLAIMS
§ 10.869 Right to make post-importation claim and refund duties.
Notwithstanding any other available
remedy, where a good would have
qualified as an originating good when
it was imported into the United States
but no claim for preferential treatment
was made, the importer of that good
may file a claim for a refund of any excess duties at any time within one year
after the date of importation of the
good in accordance with the procedures
set forth in § 10.870 of this subpart. Subject to the provisions of § 10.868 of this
subpart, CBP may refund any excess
duties by liquidation or reliquidation
of the entry covering the good in accordance with § 10.871(c) of this part.
§ 10.870 Filing procedures.
(a) Place of filing. A post-importation
claim for a refund under § 10.869 of this
subpart must be filed with the director
of the port at which the entry covering
the good was filed.
(b) Contents of claim. A post-importation claim for a refund must be filed by
presentation of the following:

(1) A written declaration stating that
the good qualified as an originating
good at the time of importation and
setting forth the number and date of
the entry or entries covering the good;
(2) A written statement indicating
whether or not the importer of the
good provided a copy of the entry summary or equivalent documentation to
any other person. If such documentation was provided, the statement must
identify each recipient by name, CBP
identification number and address and
must specify the date on which the
documentation was provided; and
(3) A written statement indicating
whether or not any person has filed a
protest relating to the good under any
provision of law; and if any such protest has been filed, the statement must
identify the protest by number and
date.
§ 10.871 CBP processing procedures.
(a) Status determination. After receipt
of a post-importation claim under
§ 10.870 of this subpart, the port director will determine whether the entry
covering the good has been liquidated
and, if liquidation has taken place,
whether the liquidation has become
final.
(b) Pending protest or judicial review. If
the port director determines that any
protest relating to the good has not
been finally decided, the port director
will suspend action on the claim for refund filed under this subpart until the
decision on the protest becomes final.
If a summons involving the tariff classification or dutiability of the good is
filed in the Court of International
Trade, the port director will suspend
action on the claim for refund filed
under this subpart until judicial review
has been completed.
(c) Allowance of claim. (1) Unliquidated
entry. If the port director determines
that a claim for a refund filed under
this subpart should be allowed and the
entry covering the good has not been
liquidated, the port director will take
into account the claim for a refund
under this subpart in connection with
the liquidation of the entry.
(2) Liquidated entry. If the port director determines that a claim for a refund filed under this subpart should be
allowed and the entry covering the

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U.S. Customs and Border Protection, DHS; Treasury
good has been liquidated, whether or
not the liquidation has become final,
the entry must be reliquidated in order
to effect a refund of duties pursuant to
this subpart. If the entry is otherwise
to be reliquidated based on administrative review of a protest or as a result of
judicial review, the port director will
reliquidate the entry taking into account the claim for refund under this
subpart.
(d) Denial of claim. (1) General. The
port director may deny a claim for a
refund filed under § 10.870 of this subpart if the claim was not filed timely,
if the importer has not complied with
the requirements of § 10.868 and § 10.870
of this subpart, or if, following an origin verification under § 10.887 of this
subpart, the port director determines
either that the imported good did not
qualify as an originating good at the
time of importation or that a basis exists upon which preferential tariff
treatment may be denied under § 10.887
of this subpart.
(2) Unliquidated entry. If the port director determines that a claim for a refund filed under this subpart should be
denied and the entry covering the good
has not been liquidated, the port director will deny the claim in connection
with the liquidation of the entry, and
notice of the denial and the reason for
the denial will be provided to the importer in writing or via an authorized
electronic data interchange system.
(3) Liquidated entry. If the port director determines that a claim for a refund filed under this subpart should be
denied and the entry covering the good
has been liquidated, whether or not the
liquidation has become final, the claim
may be denied without reliquidation of
the entry. If the entry is otherwise to
be reliquidated based on administrative review of a protest or as a result of
judicial review, such reliquidation may
include denial of the claim filed under
this subpart. In either case, the port director will give the importer notice of
the denial and the reason for the denial
in writing or via an authorized electronic data interchange system.

§ 10.872
RULES OF ORIGIN

§ 10.872

Definitions.

For purposes of §§ 10.872 through
10.880:
(a) Exporter. ‘‘Exporter’’ means a person who exports goods from the territory of a Party;
(b) Generally Accepted Accounting
Principles. ‘‘Generally Accepted Accounting Principles’’ means the recognized consensus or substantial authoritative support in the territory of a
Party, with respect to the recording of
revenues, expenses, costs, assets, and
liabilities, the disclosure of information, and the preparation of financial
statements. These standards may encompass broad guidelines of general application as well as detailed standards,
practices, and procedures;
(c) Good. ‘‘Good’’ means any merchandise, product, article, or material;
(d) Goods wholly the growth, product,
or manufacture of one or both of the Parties. ‘‘Goods wholly the growth, product, or manufacture of one or both of
the Parties’’ means:
(1) Mineral goods extracted in the
territory of one or both of the Parties;
(2) Vegetable goods, as such goods are
defined in the HTSUS, harvested in the
territory of one or both of the Parties;
(3) Live animals born and raised in
the territory of one or both of the Parties;
(4) Goods obtained from live animals
raised in the territory of one or both of
the Parties;
(5) Goods obtained from hunting,
trapping, or fishing in the territory of
one or both of the Parties;
(6) Goods (fish, shellfish, and other
marine life) taken from the sea by vessels registered or recorded with a Party
and flying its flag;
(7) Goods produced from goods referred to in paragraph (d)(6) of this section on board factory ships registered
or recorded with that Party and flying
its flag;
(8) Goods taken by a Party or a person of a Party from the seabed or beneath the seabed outside territorial
waters, provided that a Party has
rights to exploit such seabed;
(9) Goods taken from outer space,
provided they are obtained by a Party

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§ 10.872

19 CFR Ch. I (4–1–11 Edition)

or a person of a Party and not processed in the territory of a non-Party;
(10) Waste and scrap derived from:
(i) Production or manufacture in the
territory of one or both of the Parties,
or
(ii) Used goods collected in the territory of one or both of the Parties, provided such goods are fit only for the recovery of raw materials;
(11) Recovered goods derived in the
territory of a Party from used goods,
and utilized in the territory of that
Party in the production of remanufactured goods; and
(12) Goods produced in the territory
of one or both of the Parties exclusively from goods referred to in paragraphs (d)(1) through (d)(10) of this section, or from their derivatives, at any
stage of production;
(e) Importer. ‘‘Importer’’ means a person who imports goods into the territory of a Party;
(f) Indirect material. ‘‘Indirect material’’ means a good used in the growth,
production, manufacture, testing, or
inspection of a good but not physically
incorporated into the good, or a good
used in the maintenance of buildings or
the operation of equipment associated
with the growth, production, or manufacture of a good, including:
(1) Fuel and energy;
(2) Tools, dies, and molds;
(3) Spare parts and materials used in
the maintenance of equipment and
buildings;
(4) Lubricants, greases, compounding
materials, and other materials used in
the growth, production, or manufacture of a good or used to operate equipment and buildings;
(5) Gloves, glasses, footwear, clothing, safety equipment, and supplies;
(6) Equipment, devices, and supplies
used for testing or inspecting the good;
(7) Catalysts and solvents; and
(8) Any other goods that are not incorporated into the good but the use of
which in the growth, production, or
manufacture of the good can reasonably be demonstrated to be a part of
that growth, production, or manufacture;
(g) Material. ‘‘Material’’ means a good,
including a part or ingredient, that is
used in the growth, production, or
manufacture of another good that is a

new or different article of commerce
that has been grown, produced, or manufactured in one or both of the Parties;
(h) Material produced in the territory of
one or both of the Parties. ‘‘Material produced in the territory of one or both of
the Parties’’ means a good that is either wholly the growth, product, or
manufacture of one or both of the Parties, or a new or different article of
commerce that has been grown, produced, or manufactured in the territory of one or both of the Parties;
(i) New or different article of commerce.
‘‘New or different article of commerce’’
means, except as provided in § 10.873(c)
of this subpart, a good that:
(1) Has been substantially transformed from a good or material that is
not wholly the growth, product, or
manufacture of one of both of the Parties; and
(2) Has a new name, character, or use
distinct from the good or material
from which it was transformed;
(j) Non-originating material. ‘‘Non-originating material’’ means a material
that does not qualify as originating
under this subpart or General Note 31,
HTSUS;
(k) Packing materials and containers
for shipment. ‘‘Packing materials and
containers for shipment’’ means the
goods used to protect a good during its
transportation to the United States,
and does not include the packaging materials and containers in which a good
is packaged for retail sale;
(l) Recovered goods. ‘‘Recovered goods’’
means materials in the form of individual parts that result from:
(1) The disassembly of used goods
into individual parts; and
(2) The cleaning, inspecting, testing,
or other processing of those parts as
necessary for improvement to sound
working condition;
(m) Remanufactured good. ‘‘Remanufactured good’’ means an industrial
good that is assembled in the territory
of a Party and that:
(1) Is entirely or partially comprised
of recovered goods;
(2) Has a similar life expectancy to a
like good that is new; and
(3) Enjoys the factory warranty similar to that of a like good that is new;
(n) Simple combining or packaging operations. ‘‘Simple combining or packaging

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U.S. Customs and Border Protection, DHS; Treasury
operations’’ means operations such as
adding batteries to electronic devices,
fitting together a small number of
components by bolting, gluing, or soldering, and repacking or packaging
components together; and
(o) Substantially transformed. ‘‘Substantially transformed’’ means, with respect to a good or material, changed as
the result of a manufacturing or processing operation so that the good loses
its separate identity in the manufacturing or processing operation and:
(1) The good or material is converted
from a good that has multiple uses into
a good or material that has limited
uses;
(2) The physical properties of the
good or material are changed to a significant extent; or
(3) The operation undergone by the
good or material is complex by reason
of the number of different processes
and materials involved and the time
and level of skill required to perform
those processes.
§ 10.873 Originating goods.
(a) General. A good will be considered
an originating good under the OFTA
when imported directly from the territory of a Party into the territory of the
other Party only if:
(1) The good is wholly the growth,
product, or manufacture of one or both
of the Parties;
(2) The good is a new or different article of commerce, as defined in
§ 10.872(i) of this subpart, that has been
grown, produced, or manufactured in
the territory of one or both of the Parties, is provided for in a heading or subheading of the HTSUS that is not covered by the product-specific rules set
forth in General Note 31(h), HTSUS,
and meets the value-content requirement specified in paragraph (b) of this
section; or
(3) The good is provided for in a heading or subheading of the HTSUS covered by the product-specific rules set
forth in General Note 31(h), HTSUS,
and:
(i)(A) Each of the non-originating
materials used in the production of the
good undergoes an applicable change in
tariff classification specified in General Note 31(h), HTSUS, as a result of
production occurring entirely in the

§ 10.874

territory of one or both of the Parties;
or
(B) The good otherwise satisfies the
requirements specified in General Note
31(h), HTSUS; and
(ii) The good meets any other requirements specified in General Note
31, HTSUS.
(b) Value-content requirement. A good
described in paragraph (a)(2) of this
section will be considered an originating good under the OFTA only if
the sum of the value of materials produced in one or both of the Parties,
plus the direct costs of processing operations performed in one or both of the
Parties, is not less than 35 percent of
the appraised value of the good at the
time the good is entered into the territory of the United States.
(c) Combining, packaging, and diluting
operations. For purposes of this subpart, a good will not be considered a
new or different article of commerce by
virtue of having undergone simple
combining or packaging operations, or
mere dilution with water or another
substance that does not materially
alter the characteristics of the good.
The principles and examples set forth
in § 10.195(a)(2) of this part will apply
equally for purposes of this paragraph.
§ 10.874 Textile or apparel goods.
(a) De minimis. (1) General. Except as
provided in paragraph (a)(2) of this section, a textile or apparel good that is
not an originating good under the
OFTA because certain fibers or yarns
used in the production of the component of the good that determines the
tariff classification of the good do not
undergo an applicable change in tariff
classification set out in General Note
31(h), HTSUS, will be considered to be
an originating good if the total weight
of all such fibers or yarns is not more
than seven percent of the total weight
of that component.
(2) Exception. A textile or apparel
good containing elastomeric yarns in
the component of the good that determines the tariff classification of the
good will be considered to be an originating good only if such yarns are
wholly formed in the territory of a
Party.
(b) Textile or apparel goods put up in
sets. Notwithstanding the specific rules

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§ 10.875

19 CFR Ch. I (4–1–11 Edition)

specified in General Note 31(h), HTSUS,
textile or apparel goods classifiable as
goods put up in sets for retail sale as
provided for in General Rule of Interpretation 3, HTSUS, will not be considered to be originating goods under the
OFTA unless each of the goods in the
set is an originating good or the total
value of the non-originating goods in
the set does not exceed ten percent of
the appraised value of the set.
§ 10.875 Accumulation.
(a) An originating good or material
produced in the territory of one or both
of the Parties that is incorporated into
a good in the territory of the other
Party will be considered to originate in
the territory of the other Party.
(b) A good that is grown, produced, or
manufactured in the territory of one or
both of the Parties by one or more producers is an originating good if the
good satisfies the requirements of
§ 10.873 of this subpart and all other applicable requirements of General Note
31, HTSUS.
§ 10.876 Value of materials.
(a) General. For purposes of § 10.873(b)
of this subpart and, except as provided
in paragraph (b) of this section, the
value of a material produced in the territory of one or both of the Parties includes the following:
(1) The price actually paid or payable
for the material by the producer of the
good;
(2) The freight, insurance, packing
and all other costs incurred in transporting the material to the producer’s
plant, if such costs are not included in
the price referred to in paragraph (a)(1)
of this section;
(3) The cost of waste or spoilage resulting from the use of the material in
the growth, production, or manufacture of the good, less the value of recoverable scrap; and
(4) Taxes or customs duties imposed
on the material by one or both of the
Parties, if the taxes or customs duties
are not remitted upon exportation
from the territory of a Party.
(b) Exception. If the relationship between the producer of a good and the
seller of a material influenced the price
actually paid or payable for the material, or if there is no price actually

paid or payable by the producer for the
material, the value of the material produced in the territory of one or both of
the Parties includes the following:
(1) All expenses incurred in the
growth, production, or manufacture of
the material, including general expenses;
(2) A reasonable amount for profit;
and
(3) The freight, insurance, packing,
and all other costs incurred in transporting the material to the producer’s
plant.
§ 10.877 Direct costs of processing operations.
(a) Items included. For purposes of
§ 10.873(b) of this subpart, the words
‘‘direct costs of processing operations’’,
with respect to a good, mean those
costs either directly incurred in, or
that can be reasonably allocated to,
the growth, production, or manufacture of the good in the territory of one
or both of the Parties. Such costs include, to the extent they are includable
in the appraised value of the good when
imported into a Party, the following:
(1) All actual labor costs involved in
the growth, production, or manufacture of the specific good, including
fringe benefits, on-the-job training, and
the costs of engineering, supervisory,
quality control, and similar personnel;
(2) Tools, dies, molds, and other indirect materials, and depreciation on
machinery and equipment that are allocable to the specific good;
(3) Research, development, design,
engineering, and blueprint costs, to the
extent that they are allocable to the
specific good;
(4) Costs of inspecting and testing the
specific good; and
(5) Costs of packaging the specific
good for export to the territory of the
other Party.
(b) Items not included. For purposes of
§ 10.873(b) of this subpart, the words
‘‘direct costs of processing operations’’
do not include items that are not directly attributable to the good or are
not costs of growth, production, or
manufacture of the good. These include, but are not limited to:
(1) Profit; and
(2) General expenses of doing business
that are either not allocable to the

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U.S. Customs and Border Protection, DHS; Treasury
good or are not related to the growth,
production, or manufacture of the
good, such as administrative salaries,
casualty and liability insurance, advertising, and salesmen’s salaries, commissions, or expenses.
§ 10.878 Packaging and packing materials and containers for retail sale
and for shipment.
Packaging materials and containers
in which a good is packaged for retail
sale and packing materials and containers for shipment are to be disregarded in determining whether a
good qualifies as an originating good
under § 10.873 of this subpart and General Note 31, HTSUS, except that the
value of such packaging and packing
materials and containers may be included in meeting the value-content requirement specified in § 10.873(b) of this
subpart.
§ 10.879 Indirect materials.
Indirect materials are to be disregarded in determining whether a
good qualifies as an originating good
under § 10.873 of this subpart and General Note 31, HTSUS, except that the
cost of such indirect materials may be
included in meeting the value-content
requirement specified in § 10.873(b) of
this subpart.
§ 10.880 Imported directly.
(a) General. To qualify as an originating good under the OFTA, a good
must be imported directly from the
territory of a Party into the territory
of the other Party. For purposes of this
subpart, the words ‘‘imported directly’’
mean:
(1) Direct shipment from the territory of a Party into the territory of the
other Party without passing through
the territory of a non-Party; or
(2) If the shipment passed through
the territory of a non-Party, the good,
upon arrival in the territory of a
Party, will be considered to be ‘‘imported directly’’ only if the good did
not undergo production, manufacturing, or any other operation outside
the territories of the Parties, other
than unloading, reloading, or any other
operation necessary to preserve the
good in good condition or to transport
the good to the territory of a Party.

§ 10.882

Operations that may be performed outside the territories of the Parties include inspection, removal of dust that
accumulates during shipment, ventilation, spreading out or drying, chilling,
replacing salt, sulfur dioxide, or aqueous solutions, replacing damaged packing materials and containers, and removal of units of the good that are
spoiled or damaged and present a danger to the remaining units of the good,
or to transport the good to the territory of a Party.
(b) Documentary evidence. An importer making a claim for preferential
tariff treatment under the OFTA for an
originating good may be required to
demonstrate, to CBP’s satisfaction,
that the good was ‘‘imported directly’’
from the territory of a Party into the
territory of the other Party, as that
term is defined in paragraph (a) of this
section. An importer may demonstrate
compliance with this section by submitting documentary evidence. Such
evidence may include, but is not limited to, bills of lading, airway bills,
packing lists, commercial invoices, receiving and inventory records, and customs entry and exit documents.
TARIFF PREFERENCE LEVEL
§ 10.881 Filing of claim for tariff preference level.
A cotton or man-made fiber apparel
good described in § 10.882 of this subpart
that does not qualify as an originating
good under § 10.873 of this subpart may
nevertheless be entitled to preferential
tariff treatment under the OFTA under
an applicable tariff preference level
(TPL). To make a TPL claim, the importer must include on the entry summary, or equivalent documentation,
the applicable subheading in Chapter 99
of the HTSUS (9916.99.20) immediately
above the applicable subheading in
Chapter 61 or Chapter 62 of the HTSUS
under which each non-originating cotton or man-made fiber apparel good is
classified.
§ 10.882 Goods eligible for tariff preference claims.
Cotton or man-made fiber apparel
goods provided for in Chapters 61 or 62
of the HTSUS that are cut or knit to
shape, or both, and sewn or otherwise

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§ 10.883

19 CFR Ch. I (4–1–11 Edition)

assembled in the territory of Oman
from fabric or yarn produced or obtained outside the territory of Oman or
the United States are eligible for a
TPL claim filed under § 10.881 of this
subpart (subject to the quantitative
limitations set forth in U.S. Note 13,
Subchapter XVI, Chapter 99, HTSUS).
§ 10.883

[Reserved]

§ 10.884

Declaration.

(a) General. An importer who claims
preferential tariff treatment on a nonoriginating cotton or man-made fiber
good specified in § 10.882 of this subpart
must submit, at the request of the port
director, a declaration supporting such
a claim for preferential tariff treatment that sets forth all pertinent information concerning the production of
the good, including:
(1) A description of the good, quantity, invoice numbers, and bills of lading;
(2) A description of the operations
performed in the production of the
good in the territory of one or both of
the Parties;
(3) A statement as to any yarn or fabric of a non-Party and the origin of
such materials used in the production
of the good.
(b) Retention of records. An importer
must retain all documents relied upon
to prepare the declaration for a period
of five years.

than unloading, reloading, or any other
operation necessary to preserve the
good in good condition or to transport
the good to the territory of a Party.
Operations that may be performed outside the territories of the Parties include inspection, removal of dust that
accumulates during shipment, ventilation, spreading out or drying, chilling,
replacing salt, sulfur dioxide, or aqueous solutions, replacing damaged packing materials and containers, and removal of units of the good that are
spoiled or damaged and present a danger to the remaining units of the good,
or to transport the good to the territory of a Party.
(b) Documentary evidence. An importer making a claim for preferential
tariff treatment under an applicable
TPL may be required to demonstrate,
to CBP’s satisfaction, that the good
was ‘‘imported directly’’ from the territory of a Party into the territory of the
other Party, as that term is defined in
paragraph (a) of this section. An importer may demonstrate compliance
with this section by submitting documentary evidence. Such evidence may
include, but is not limited to, bills of
lading, airway bills, packing lists, commercial invoices, receiving and inventory records, and customs entry and
exit documents.

non-origi-

§ 10.886 Effect of non-compliance; failure to provide documentation regarding transshipment of non-originating apparel goods.

(a) General. To qualify for preferential tariff treatment under an applicable TPL, a good must be imported
directly from the territory of a Party
into the territory of the other Party.
For purposes of this subpart, the words
‘‘imported directly’’ mean:
(1) Direct shipment from the territory of a Party into the territory of the
other Party without passing through
the territory of a non-Party; or
(2) If the shipment passed through
the territory of a non-Party, the good,
upon arrival in the territory of a
Party, will be considered to be ‘‘imported directly’’ only if the good did
not undergo production, manufacturing, or any other operation outside
the territories of the Parties, other

(a) General. If an importer of a good
for which a TPL claim is made fails to
comply with any applicable requirement under this subpart, the port director may deny preferential tariff
treatment to the imported good.
(b) Failure to provide documentation regarding transshipment. Where the requirements for preferential tariff treatment set forth elsewhere in this subpart are met, the port director nevertheless may deny preferential tariff
treatment to a good for which a TPL
claim is made if the good is shipped
through or transshipped in a country
other than a Party, and the importer of
the good does not provide, at the request of the port director, evidence
demonstrating to the satisfaction of
the port director that the requirements

§ 10.885 Transshipment of
nating apparel goods.

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U.S. Customs and Border Protection, DHS; Treasury

§ 10.890
PENALTIES

set forth in § 10.885 of this subpart were
met.

§ 10.889 Violations
OFTA.

ORIGIN VERIFICATIONS AND
DETERMINATIONS
§ 10.887 Verification and justification
of claim for preferential treatment.
(a) Verification. A claim for preferential treatment made under § 10.863
or § 10.870 of this subpart, including any
declaration or other information submitted to CBP in support of the claim,
will be subject to such verification as
the port director deems necessary. In
the event that the port director is provided with insufficient information to
verify or substantiate the claim, the
port director may deny the claim for
preferential treatment.
(b) Applicable accounting principles.
When conducting a verification of origin to which Generally Accepted Accounting Principles may be relevant,
CBP will apply and accept the Generally Accepted Accounting Principles
applicable in the country of production.
§ 10.888 Issuance of negative origin determinations.
If, as a result of an origin
verification initiated under this subpart, CBP determines that a claim for
preferential tariff treatment made
under § 10.863 of this subpart should be
denied, it will issue a determination in
writing or via an authorized electronic
data interchange system to the importer that sets forth the following:
(a) A description of the good that was
the subject of the verification together
with the identifying numbers and dates
of the export and import documents
pertaining to the good;
(b) A statement setting forth the
findings of fact made in connection
with the verification and upon which
the determination is based; and
(c) With specific reference to the
rules applicable to originating goods as
set forth in General Note 31, HTSUS,
and in §§ 10.863 through 10.886 of this
subpart, the legal basis for the determination.

relating

to

All criminal, civil, or administrative
penalties which may be imposed upon
importers or other parties for violations of the U.S. customs or related
laws or regulations will also apply to
importations subject to the OFTA.
GOODS RETURNED AFTER REPAIR OR
ALTERATION
§ 10.890 Goods re-entered after repair
or alteration in Oman.
(a) General. This section sets forth
the rules that apply for purposes of obtaining duty-free treatment on goods
returned after repair or alteration in
Oman as provided for in subheadings
9802.00.40 and 9802.00.50, HTSUS. Goods
returned after having been repaired or
altered in Oman, whether or not pursuant to a warranty, are eligible for
duty-free treatment, provided that the
requirements of this section are met.
For purposes of this section, ‘‘repairs or
alterations’’ means restoration, renovation, cleaning, re-sterilizing, or other
treatment which does not destroy the
essential characteristics of, or create a
new or commercially different good
from, the good exported from the
United States.
(b) Goods not eligible for treatment. The
duty-free treatment referred to in
paragraph (a) of this section will not
apply to goods which, in their condition as exported from the United
States to Oman, are incomplete for
their intended use and for which the
processing operation performed in
Oman constitutes an operation that is
performed as a matter of course in the
preparation or manufacture of finished
goods.
(c) Documentation. The provisions of
paragraphs (a), (b), and (c) of § 10.8 of
this part, relating to the documentary
requirements for goods entered under
subheading 9802.00.40 or 9802.00.50,
HTSUS, will apply in connection with
the entry of goods which are returned
from Oman after having been exported
for repairs or alterations and which are
claimed to be duty free.

347

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