60082 Federal Register / Vol. 69, No. 194 / Thursday, October 7, 2004 / Rules and Regulations 

Issued in Renton, Washington, on 

September 20, 2004. 

Kalene C. Yanamura, 

Acting Manager, Transport Airplane 

Directorate, Aircraft Certification Service.

[FR Doc. 04–21815 Filed 10–6–04; 8:45 am] 

BILLING CODE 4910–13–P

DEPARTMENT OF HOMELAND 

SECURITY 

Customs and Border Protection 

DEPARTMENT OF THE TREASURY 

19 CFR Part 191 

[CBP Dec. 04—33] 

RIN 1505–AB44 

Merchandise Processing Fees Eligible 

To Be Claimed as Certain Types of 

Drawback Based on Substitution of 

Finished Petroleum Derivatives

AGENCY: Customs and Border Protection, 

Homeland Security; Treasury.

ACTION: Final rule.

SUMMARY: This document amends the 

Customs and Border Protection (CBP) 

Regulations to provide that merchandise 

processing fees are eligible to be 

claimed, in limited circumstances, as 

drawback based on substitution of 

finished petroleum derivatives. The 

changes implemented by this document 

are consistent with a court decision in 

which merchandise processing fees 

were found to be eligible to be claimed 

as unused merchandise drawback. As 

drawback based on substitution of 

finished petroleum derivatives is, in 

limited circumstances, treated in the 

same manner as unused merchandise 

drawback, this amendment reflects that 

merchandise processing fees are also 

eligible to be claimed as drawback in 

these circumstances.

DATES: Effective November 8, 2004.

FOR FURTHER INFORMATION CONTACT:

William G. Rosoff, Chief, Duty and 

Refund Determinations Branch, Office 

of Regulations and Rulings, U.S. 

Customs Service, Tel. (202) 572–8807.

SUPPLEMENTARY INFORMATION: 

Background 

Merchandise Processing Fees 

Merchandise processing fees are fees 

the Secretary of the Treasury charges 

and collects for the processing of 

merchandise that is formally entered or 

released into the United States. See 19 

U.S.C. 58c(a)(9)(A). Merchandise 

processing fees are assessed as a 

percentage of the value of the imported 

merchandise, as determined under 19 

U.S.C. 1401a. 

Merchandise Processing Fees Eligible To 

Be Claimed as Drawback 

Section 313 of the Tariff Act of 1930, 

as amended, (19 U.S.C. 1313), concerns 

drawback and refunds. Drawback is a 

refund of certain duties, taxes and fees 

paid by the importer of record and 

granted to a drawback claimant under 

specific conditions. 

In Texport Oil v. United States, 185 

F.3d 1291 (Fed. Cir. 1999), the Court of 

Appeals for the Federal Circuit (CAFC) 

held that merchandise processing fees 

were assessed under Federal law and 

imposed by reason of importation and 

therefore eligible to be claimed as 

unused merchandise drawback pursuant 

to 19 U.S.C. 1313(j). 

Subsection (p) of 19 U.S.C. 1313 

authorizes drawback that is based on 

‘‘substitution of finished petroleum 

derivatives.’’ Subsection (p)(4)(B) of 19 

U.S.C. 1313, in pertinent part, limits the 

amount of drawback payable under this 

subsection to the amount of drawback 

that would be attributable to the article 

‘‘if imported under [subsection 

1313(p)(2)(A)(iii) or (iv)] had the claim 

qualified for drawback under subsection 

(j).’’ [emphasis added] 

Subsection 1313(p)(2)(A)(iii) requires 

that the exporter of the exported article 

imported the qualified article in a 

quantity equal to or greater than the 

quantity of the exported article. 

Subsection 1313(p)(2)(A)(iv) requires 

that the exporter of the exported article 

purchased or exchanged, directly or 

indirectly, an imported qualified article 

from an importer in a quantity equal to 

or greater than the quantity of the 

exported article. 

The language ‘‘had the claim qualified 

for drawback under subsection (j)’’

reflects that drawback is payable under 

1313(p)(2)(A)(iii) or (iv) pursuant to the 

same formula set forth in subsection 

1313(j), i.e., the amount of drawback 

payable under 19 U.S.C. 1313(j) is not 

to exceed 99 percent of any duty, tax, 

or fee imposed under Federal law 

because of the imported article’s 

importation. The term ‘‘drawback 

payable’’ under 19 U.S.C. 

1313(p)(2)(A)(iii) and (iv) includes the 

merchandise processing fee.

Consistent with the determination of 

the CAFC that merchandise processing 

fees are eligible to be claimed as 

drawback pursuant to 19 U.S.C. 1313(j), 

such fees are also eligible to be claimed 

as drawback when drawback is based on 

substitution of finished petroleum 

derivatives pursuant to 19 U.S.C. 

1313(p)(2)(A)(iii) or (iv). 

Amendment to CBP Regulations To 

Reflect the Texport Oil Decision 

The Texport Oil decision is reflected 

in the CBP Regulations at §§ 191.3 and 

191.51. See 67 FR 48547 (July 25, 2002), 

in which a final rule was published 

amending the CBP Regulations to reflect 

that merchandise processing fees are 

eligible to be claimed as unused 

merchandise drawback pursuant to 19 

U.S.C. 1313(j). 

On October 2, 2003, CBP published in 

the Federal Register (68 FR 56804) a 

proposal to amend §§ 191.3, 191.51 and 

191.171 to reflect that the Texport Oil

decision is applicable, in limited 

circumstances, to drawback based on 

substitution of finished petroleum 

derivatives. 

Comments were solicited on the 

proposal. 

Discussion of Comment 

One comment was received in 

response to the solicitation of public 

comment in 68 FR 56804. The 

commenter supported CBP’s proposal to 

reflect the Texport Oil court decision in 

part 191 of the CBP Regulations as 

regards drawback based on substitution 

of finished petroleum derivatives. The 

commenter noted that the proposed 

amendments contribute to the goal of 

offsetting the cost of raw materials. 

Conclusion 

After review of the one comment 

received, and upon consideration, CBP 

has decided to adopt as final the 

proposed rule published in the Federal 

Register (68 FR 56804) on October 2, 

2003. 

The Regulatory Flexibility Act and 

Executive Order 12866 

Because these regulations serve to 

conform the CBP Regulations to reflect 

the full scope of a recent decision by the 

Court of Appeals for the Federal Circuit 

whereby, in limited circumstances, 

merchandise processing fees are eligible 

to be claimed as drawback, it is certified 

pursuant to the provisions of the 

Regulatory Flexibility Act, 5 U.S.C. 601 

et seq. that this amendment will not 

have a significant impact on a 

substantial number of small entities. 

Further, this amendment does not meet 

the criteria for a ‘‘significant regulatory 

action’’ as specified in Executive Order 

12866. 

Signing Authority 

This document is being issued in 

accordance with 19 CFR 0.1(a)(1). 

Drafting Information 

The principal author of this document 

was Ms. Suzanne Kingsbury, 

Federal Register / Vol. 69, No. 194 / Thursday, October 7, 2004 / Rules and Regulations 60083

Regulations Branch, Office of 

Regulations and Rulings, U.S. Customs 

and Border Protection. However, 

personnel from other offices 

participated in its development.

List of Subjects in 19 CFR Part 191 

Claims, Commerce, CBP duties and 

inspection, Drawback.

Amendments to the Regulations

■ For the reasons stated above, part 191 

of the CBP Regulations (19 CFR part 191) 

is amended as follows:

PART 191 — DRAWBACK

■ 1. The general authority citation for 

part 191 continues to read as follows:

Authority: 5 U.S.C. 301; 19 U.S.C. 66, 1202 

(General Note 23, Harmonized Tariff 

Schedule of the United States), 1313, 1624.

■ 2. Section 191.3(a)(4) and (b)(2) are 

revised as follows:

§ 191.3 Duties and fees subject or not 

subject to drawback. 

(a) Duties and fees subject to 

drawback include:

* * * * *

(4) Merchandise processing fees (see 

§ 24.23 of this chapter) for unused 

merchandise drawback pursuant to 19 

U.S.C. 1313(j), and drawback for 

substitution of finished petroleum 

derivatives pursuant to 19 U.S.C. 

1313(p)(2)(A)(iii) or (iv). 

(b) * * *

(2) Merchandise processing fees (see

§ 24.23 of this chapter), except where 

unused merchandise drawback pursuant 

to 19 U.S.C. 1313(j) or drawback for 

substitution of finished petroleum 

derivatives pursuant to 19 U.S.C. 

1313(p)(2)(A)(iii) or (iv) is claimed; and

* * * * *

■ 3. In § 191.51, paragraph (b)(2) 

introductory text is revised to read as 

follows:

§ 191.51 Completion of drawback claims.

* * * * *

(b) * * *

(2) Merchandise processing fee 

apportionment calculation. Where a 

drawback claimant seeks unused 

merchandise drawback pursuant to 19 

U.S.C. 1313(j), or drawback for 

substitution of finished petroleum 

derivatives pursuant to 19 U.S.C. 

1313(p)(2)(A)(iii) or (iv), for a 

merchandise processing fee paid 

pursuant to 19 U.S.C. 58c(a)(9)(A), the 

claimant is required to correctly 

apportion the fee to that merchandise 

that provides the basis for drawback 

when calculating the amount of 

drawback requested on the drawback 

entry. This is determined as follows:

* * * * *

■ 4. In § 191.171, a new paragraph (c) is 

added to read as follows:

§ 191.171 General; drawback allowance.

* * * * *

(c) Merchandise processing fees. In 

cases where the requirements of 

paragraph (b)(1) of this section have 

been met, merchandise processing fees 

will be eligible for drawback.

Approved: October 4, 2004. 

Robert C. Bonner, 

Commissioner, U.S. Customs and Border 

Protection. 

Timothy E. Skud, 

Deputy Assistant Secretary of the Treasury.

[FR Doc. 04–22599 Filed 10–6–04; 8:45 am] 

BILLING CODE 4820–02–P

DEPARTMENT OF VETERANS 

AFFAIRS 

38 CFR Parts 1 and 3 

RIN 2900–AM09 

Presumptions of Service Connection 

for Diseases Associated With Service 

Involving Detention or Internment as a 

Prisoner of War

AGENCY: Department of Veterans Affairs.

ACTION: Interim final rule.

SUMMARY: The Department of Veterans 

Affairs (VA) is issuing this interim final 

rule to establish guidelines for 

establishing presumptions of service 

connection for diseases associated with 

service involving detention or 

internment as a prisoner of war. In 

accordance with those guidelines, this 

interim final rule also establishes 

presumptions of service connection for 

atherosclerotic and hypertensive heart 

disease and for stroke disease arising in 

former prisoners of war. These rules are 

necessary because claims based on 

service involving detention or 

internment as a prisoner of war present 

unique medical issues and because 

factors including the lack of 

contemporaneous medical records 

during periods of captivity and the 

relatively small body of available 

medical information present obstacles to 

substantiating claims for serviceconnected benefits based on prisoner-ofwar service. By establishing guidelines 

for identifying diseases associated with 

service involving detention or 

internment as a prisoner of war, these 

rules will help VA to ensure that claims 

for service-connected benefits for 

disability or death of former prisoners of 

war are decided fairly, consistently, and 

based on all available medical 

information concerning the diseases 

associated with detention or internment 

as a prisoner of war.

DATES: This interim final rule is 

effective October 7, 2004. Comments 

must be received on or before November 

8, 2004.

ADDRESSES: Written comments may be 

submitted by: mail or hand-delivery to 

Director, Regulations Management 

(00REG1), Department of Veterans 

Affairs, 810 Vermont Ave., NW., Room 

1068, Washington, DC 20420; fax to 

(202) 273–9026; e-mail to 

VAregulations@mail.va.gov; or, through 

http://www.Regulations.gov. Comments 

should indicate that they are submitted 

in response to ‘‘RIN 2900–AM09.’’ All 

comments received will be available for 

public inspection in the Office of 

Regulation Policy and Management, 

Room 1063B, between the hours of 8 

a.m. and 4:30 p.m., Monday through 

Friday (except holidays). Please call 

(202) 273–9515 for an appointment.

FOR FURTHER INFORMATION CONTACT:

David Barrans, Deputy Assistant 

General Counsel (022D), Office of 

General Counsel, Department of 

Veterans Affairs, 810 Vermont Avenue, 

NW., Washington, DC 20420, (202) 273–

6332.

SUPPLEMENTARY INFORMATION: VA is 

revising its regulations to include a new 

provision, codified at 38 CFR 1.18, 

establishing guidelines for determining 

whether to establish new presumptions 

of service connection for any disease 

associated with service involving 

detention or internment as a prisoner of 

war. VA is also amending its 

adjudication regulations at 38 CFR 

3.309(c) to add atherosclerotic heart 

disease or hypertensive vascular disease 

and stroke to the list of diseases VA will 

presume to be associated with service 

involving detention or internment as a 

prisoner of war (POW), and to reflect 

statutory changes. These new 

presumptions of service connection 

reflect VA’s determination that 

presumptions for heart disease and 

stroke are warranted by application of 

the guidelines set forth in § 1.18. 

Guidelines for Identifying POW 

Presumptive Conditions 

Statutory and regulatory standards 

currently exist to guide VA in 

identifying diseases associated with 

exposure to herbicide agents, hazards of 

service in the Gulf War, and ionizing 

radiation. See 38 U.S.C. 1116 and 1118; 

38 CFR 1.17. VA has determined that it 

would be helpful to establish standards 

to guide VA in identifying diseases