63 FR 40230, July 28, 1998  Proposed Rules

DEPARTMENT OF COMMERCE

International Trade Administration

15 CFR Part 303

DEPARTMENT OF THE INTERIOR

Office of Territorial and International Affairs
[Docket No. 980716178-8178-01]
RIN 0625-AA53

 
Proposed Limit on Duty-Free Insular Watches in Calendar Year 1999

AGENCIES: Import Administration, International Trade Administration, 
Department of Commerce; Office of Insular Affairs, Department of the 
Interior.

ACTION: Proposed rule and request for comments.

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SUMMARY: This action invites public comment on a proposal to amend the 
Departments' ITA regulations governing duty-exemption allocations and 
duty-refund entitlements for watch producers in the United States' 
insular possessions (the Virgin Islands, Guam and American Samoa) and 
the Northern Mariana Islands. The proposed amendments would change the 
value limit for watches eligible for duty-exemption, update the 
creditable wage ceiling, modify the new entrant invitation language and 
establish the total quantity and respective territorial shares of 
insular watches and watch movements which would be allowed to enter the 
United States free of duty during calendar year 1999.

DATES: Comments must be received on or before August 27, 1998.

ADDRESSES: Address written comments to Faye Robinson, Program Manager, 
Statutory Import Programs Staff, Room 4211, U.S. Department of 
Commerce, Washington, DC 20230.

FOR FURTHER INFORMATION CONTACT: Faye Robinson, (202) 482-3526, same 
address as above.

SUPPLEMENTARY INFORMATION: The insular possessions watch industry 
provision in Sec. 110 of Pub. L. No. 97-446 (96 Stat. 2331) (1983) as 
amended by Sec. 602 of Pub. L. No. 103-465 (108 Stat. 4991) (1994) 
additional U.S. Note 5 to chapter 91 of the HTS requires the Secretary 
of Commerce and the Secretary of the Interior, acting jointly, to 
establish a limit on the quantity of watches and watch movements which 
may be entered free of duty during each calendar year. The law also 
requires the Secretaries to establish the shares of this limited 
quantity which may be entered from the Virgin Islands, Guam, American 
Samoa and the Northern Mariana Islands. Regulations on the 
establishment of these quantities and shares are contained in Sec. 
303.3 and 303.4 of title 15, Code of Federal Regulations (15 CFR 303.3 
and 303.4). The Departments propose to establish for calendar year 1999 
a total quantity of 3,740,000 units and respective territorial shares 
as shown in the following table:

                                                                        
                                                                        
                                                                        
Virgin Islands.............................................    2,240,000
Guam.......................................................      500,000
American Samoa.............................................      500,000
Northern Mariana Islands...................................      500,000
                                                                        

    Compared to the total quantity established for 1998 (63 FR 5887; 
February 5, 1998), this amount would be a decrease of 400,000 units. 
The proposed Virgin Islands territorial share would be reduced by 
400,000 and the shares for Guam, American Samoa and the Northern 
Mariana Islands would not change. The amount we propose for the Virgin 
Islands is more than sufficient for the anticipated needs of all the 
existing producers.
    We also propose raising the maximum value of components for duty-
free treatment of watches from $200 to $500 by amending Sec. 
303.14(b)(3). This change would relax the limitation on the value of 
imported components that may be used in the assembly of duty-free 
insular watches. The proposed value levels would provide the producers 
with a greater choice in the kinds of watches they assemble, thereby 
affording them an opportunity to increase shipments and raise 
territorial employment.
    We propose raising from $35,000 to $38,650 the maximum dollar 
amount of wages creditable in the calculation of the value of the 
production incentive certificate by amending Sec. 303.14(a)(1)(i). The 
increase in the maximum creditable wage limit is being proposed to keep 
pace with inflation. The ceiling was last raised in 1994.
    Finally, we propose eliminating subparagraphs (1) and (2) of 
Sec. 303.14(d) and consolidating provisions on new entrant invitations 
in a revised Sec. 303.14(d). There is no longer a producer in Guam, 
leaving the Virgin Islands as the only territory with an active 
industry. The proposed change would remove the need to amend the 
regulations when such production shifts occur.

Regulatory Flexibility Act

    In accordance with the Regulatory Flexibility Act, 5 U.S.C. 601 et 
seq., the Assistant General Counsel for Legislation and Regulation has 
certified to the Chief Counsel, Small Business Administration, that the 
proposed rule will not have a significant economic impact on a 
substantial number of small entities. This is because the rulemaking 
affects only the five watch companies currently participating in the 
insular possessions watch program, all of which are located in the 
Virgin Islands. Although a reduction of the 1999 Virgin Islands 
territorial share of duty-exemption is being proposed, the reduced 
amount would still represent more than twice the amount of duty-free 
shipments used in 1997. Accordingly, the proposed reduction for the 
1999 annual duty-exemption for the Virgin Islands should not impose any 
cost or have any economic effect on these small companies. Similarly, 
updating the creditable wage ceiling, simplifying and updating the new 
entrant invitation language and raising the value limit for watches 
eligible for duty-exemption will not impose any cost or have any other 
adverse economic effect on the producers.

Paperwork Reduction Act

    This proposed rulemaking involves information collection activities 
subject to the Paperwork Reduction Act of 1980, 44 U.S.C. 3501 et seq. 
which are currently approved by the Office of Management and Budget 
under control numbers 0625-0040 and 0625-0134. The amendments will not 
increase the information burden on the public.
    Notwithstanding any other provision of the law, no person is 
required to respond to, nor shall any person be subject to a penalty 
for failure to comply with a collection of information unless it 
displays a currently valid OMB Control Number.
    It has been determined that the proposed rulemaking is not 
significant for purposes of Executive Order 12866.

List of Subjects in 15 CFR Part 303

    Administrative practice and procedure, American Samoa, Customs 
duties and inspection, Guam, Imports, Marketing quotas, Northern 
Mariana Islands, Reporting and recordkeeping requirements, Virgin 
Islands, Watches and jewelry.

    For reasons set forth above, we propose to amend 15 CFR part 303 as 
follows:

PART 303--[AMENDED]

    1. The authority citation for 15 CFR part 303 continues to read as 
follows:

    Authority: Pub. L. 94-241, 90 Stat. 263 (48 U.S.C. 1681, note); 
Pub. L. 97-446, 96 Stat. 2331 (19 U.S.C. 1202, note); Pub. L. 103-
465, 108 Stat. 4991.

[[Page 40231]]

Sec. 303.14  [Amended]

    2. Section 303.14(a)(1)(i) is amended by removing ``$35,000'' and 
adding ``$38,650'' in its place.
    3. Section 303.14(b)(3) is amended by removing ``$200'' and adding 
``$500'' in its place.
    4. Section 303.14(d) is revised to read as follows:


Sec. 303.14  Allocation factors and miscellaneous provisions.

* * * * *
    (d) New entrant invitations. Applications from new firms are 
invited for any unused portion of any territorial share.
* * * * *
    5. Section 303.14(e) is amended by removing ``2,640,000'' and 
adding ``2,240,000'' in its place.
Robert S. LaRussa,
Assistant Secretary for Import Administration.
Allen Stayman,
Director, Office of Insular Affairs.
[FR Doc. 98-20162 Filed 7-27-98; 8:45 am]
BILLING CODE 3510-DS-P 4310-93-P