[Federal Register Volume 74, Number 196 (Tuesday, October 13, 2009)]
[Rules and Regulations]
[Pages 52400-52401]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-24489]


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DEPARTMENT OF HOMELAND SECURITY

Bureau of Customs and Border Protection

19 CFR Part 111

[CBP Dec. 09-38]


Customs Broker License Examination Appeals

AGENCY: Customs and Border Protection, DHS.

ACTION: Final rule.

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SUMMARY: This final rule amends the U.S. Customs and Border Protection 
(CBP) regulations, which govern the licensing and conduct of customs 
brokers. The rule specifies the proper CBP official who is authorized 
to decide the final administrative appeal of a failing grade on the 
customs broker written examination. The current regulations provide 
that the final administrative appeal on a failing grade on the broker's 
exam should be sent in writing to the Secretary of Homeland Security, 
or her designee. This final rule amends the CBP regulations to specify 
that examinees should submit final administrative appeals to the 
Assistant Commissioner, Office of International Trade.

DATES: This final rule is effective on October 13, 2009.

FOR FURTHER INFORMATION CONTACT: Russell Morris, Broker Compliance 
Branch, Trade Policy and Programs, Office of International Trade, (202) 
863-6543.

SUPPLEMENTARY INFORMATION:

Background

    Section 641 of the Tariff Act of 1930 (Tariff Act), as amended (19 
U.S.C. 1641) authorizes the Secretary of the Treasury to prescribe 
rules and regulations relating to the customs business of brokers as 
necessary to protect importers and the revenue of the United States. 
Specifically, section 641 provides that a person (an individual, 
corporation, association, or partnership) must hold a valid customs 
broker's license and permit in order to transact customs business on 
behalf of others. In the case of an applicant for an individual 
broker's license, section 641 states that the Secretary of the Treasury 
may conduct an examination to determine an applicant's qualifications 
for a license.
    The Homeland Security Act of 2002 (Homeland Security Act) generally 
transferred the functions of the U.S. Customs Service from the Treasury 
Department to the Secretary of Homeland Security. 6 U.S.C. 101 et seq. 
Section 412 of the Homeland Security Act (6 U.S.C. 212) provides that 
the Secretary of the Treasury retains customs revenue functions unless 
the Secretary of the Treasury delegates the authority to the Secretary 
of Homeland Security. The regulation of customs brokers is encompassed 
within the customs revenue functions set forth in section 412 of the 
Homeland Security Act. On May 15, 2003, the Secretary of the Treasury 
delegated authority related to the customs revenue functions to the 
Secretary of Homeland Security subject to certain exceptions. See 
Treasury Order No. 100-16 (Appendix to 19 CFR Part 0). Since the 
authority to prescribe the rules and regulations related to customs 
brokers is not listed as one of the exceptions, this authority now

[[Page 52401]]

resides with the Secretary of Homeland Security.
    Pursuant to section 641 of the Tariff Act, part 111 of title 19 of 
the Code of Federal Regulations sets forth the conduct and licensing 
requirements for customs brokers. Section 111.11 sets forth the basic 
requirements for obtaining a broker's license, including the 
requirement that the applicant must obtain a passing grade on the 
written examination within a 3-year period before submitting the 
application for a broker's license. 19 CFR 111.11.
    Section 111.13(f) provides that an examinee can appeal a failing 
grade on the written examination by first filing a written appeal with 
Trade Policy and Programs, Office of International Trade, U.S. Customs 
and Border Protection (CBP), within 60 calendar days after the date of 
the written notice of the examination results. 19 CFR 111.13(f). After 
reviewing the submission, CBP provides the examinee with a written 
notice setting forth the decision on the appeal. If CBP's decision on 
the appeal reaffirms the result of the examination, the examinee may 
subsequently request review of CBP's decision on the appeal by writing 
to the Secretary of Homeland Security, or her designee, within 60 
calendar days after the date of the notice from CBP.

Explanation of Amendment

    As noted above, the Secretary of the Treasury delegated to the 
Secretary of Homeland Security the authority to prescribe rules and 
regulations relating to customs brokers. The Secretary of Homeland 
Security, in turn, delegated some of this authority to the Commissioner 
of CBP including the authority to regulate brokers. See Delegation 
Number 7010.3, dated May 11, 2006.
    On October 19, 2007, CBP published a final rule in the Federal 
Register, at 72 FR 59166, setting forth technical corrections to the 
CBP regulations to reflect changes in CBP's organizational structure. 
Among the many technical changes in that document, consistent with the 
Homeland Security Act and Treasury Delegation 100-16, CBP amended 19 
CFR 111.13(f) to remove the Secretary of the Treasury as the official 
with the authority to issue the final administrative appeal on a 
failing grade on the broker's exam and gave the Secretary of Homeland 
Security or her designee that authority.
    Since the publication of the final rule regarding this particular 
technical amendment, CBP has determined that the Assistant Commissioner 
in CBP's Office of International Trade is the most appropriate official 
to issue the final administrative appeal on a failing grade on the 
written customs broker's exam. This designation is consistent with DHS 
Delegation Number 7010.3, which delegates the authority to regulate 
customs brokers to the Commissioner of CBP. In addition, CBP notes that 
the Office of International Trade is staffed with examination subject 
matter experts and is uniquely positioned to independently and 
expeditiously review examination appeals. Accordingly, Sec.  111.13(f) 
is being amended in this document by removing ``Secretary of Homeland 
Security, or his designee'' and adding, in its place, ``Assistant 
Commissioner, Office of International Trade, U.S. Customs and Border 
Protection.''

Administrative Procedure Act

    Since this rule pertains to matters relating to rules of agency 
organization, procedure, or practice, this rule is not a substantive 
rule and is exempt from the notice and comment rulemaking requirements 
under the Administrative Procedure Act. See 5 U.S.C. 553(b)(A). In 
addition, the delayed effective date requirement of 5 U.S.C. 553(d) 
does not apply to this rule for these same reasons.

Regulatory Flexibility Act

    Because this rule is not subject to the notice and public comment 
procedure requirements of 5 U.S.C. 553, it is not subject to the 
provisions of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.).

Executive Order 12866

    These amendments do not meet the criteria for a ``significant 
regulatory action'' as specified in Executive Order 12866. Therefore, 
the Office of Management and Budget (OMB) has not reviewed this rule.

Signing Authority

    This document is being issued by CBP in accordance with Sec.  
0.1(b)(1) of the CBP regulations (19 CFR 0.1(b)(1)).

List of Subjects in 19 CFR Part 111

    Administrative practice and procedure, Brokers, Customs duties and 
inspection, Imports, Licensing, Reporting and recordkeeping 
requirements.

Amendments to the CBP Regulations

0
For the reasons set forth above, part 111 of title 19 of the Code of 
Federal Regulations (19 CFR part 111) is amended as follows:

PART 111--CUSTOMS BROKERS

0
1. The general authority citation for Part 111 continues to read as 
follows:

    Authority:  19 U.S.C. 66, 1202 (General Note 3(i), Harmonized 
Tariff Schedule of the United States), 1624, 1641.


0
2. In Sec.  111.13, paragraph (f) is revised to read as follows:


Sec.  111.13  Written examination for individual license.

* * * * *
    (f) Appeal of failing grade on examination. If an examinee fails to 
attain a passing grade on the examination taken under this section, the 
examinee may challenge that result by filing a written appeal with 
Trade Policy and Programs, Office of International Trade, U.S. Customs 
and Border Protection, Washington, DC 20005 within 60 calendar days 
after the date of the written notice provided for in paragraph (e) of 
this section. CBP will provide to the examinee written notice of the 
decision on the appeal. If the CBP decision on the appeal affirms the 
result of the examination, the examinee may request review of the 
decision on the appeal by writing to the Assistant Commissioner, Office 
of International Trade, U.S. Customs and Border Protection, within 60 
calendar days after the date of the notice on that decision.

    Dated: September 21, 2009.
Janet Napolitano,
Secretary.
[FR Doc. E9-24489 Filed 10-9-09; 8:45 am]
BILLING CODE 9111-14-P