[Federal Register Volume 71, Number 201 (Wednesday, October 18, 2006)]
[Rules and Regulations]
[Pages 61399-61403]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-8761]


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DEPARTMENT OF HOMELAND SECURITY

Bureau of Customs and Border Protection

DEPARTMENT OF THE TREASURY

19 CFR Parts 12 and 163

[USCBP-2006-0108; CBP Dec. 06-25]
RIN 1505-AB73


Entry of Softwood Lumber Products From Canada

AGENCIES: Customs and Border Protection, Department of Homeland 
Security; Department of the Treasury.

ACTION: Interim rule.

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SUMMARY: This document sets forth interim amendments to title 19 of the 
Code of Federal Regulations (CFR) establishing special entry 
requirements applicable to shipments of softwood lumber products from 
Canada. The interim amendments involve the collection of additional 
entry summary information for purposes of monitoring and enforcing the 
Softwood Lumber Agreement between the Governments of Canada and the 
United States, entered into on September 12, 2006.

DATES: Interim rule effective October 16, 2006. Comments must be 
received on or before December 18, 2006.

ADDRESSES: You may submit comments, identified by docket number, by one 
of the following methods:
    <bullet> Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments via docket number 
USCBP-2006-0108.
    <bullet> Mail: Trade and Commercial Regulations Branch, Office of 
Regulations and Rulings, Bureau of Customs and Border Protection, 1300 
Pennsylvania Avenue, NW. (Mint Annex), Washington, DC 20229.
    Instructions: All submissions received must include the agency name 
and

[[Page 61400]]

docket number for this rulemaking. All comments received will be posted 
without change to http://www.regulations.gov, including any personal 
information provided. For detailed instructions on submitting comments 
and additional information on the rulemaking process, see the ``Public 
Participation'' heading of the SUPPLEMENTARY INFORMATION section of 
this document.
    Docket: For access to the docket to read background documents or 
comments received, go to http://www.regulations.gov. Submitted comments 
may also be inspected during regular business days between the hours of 
9 a.m. and 4:30 p.m. at the Office of Regulations and Rulings, Bureau 
of Customs and Border Protection, 799 9th Street, NW., 5th Floor, 
Washington, DC. Arrangements to inspect submitted comments should be 
made in advance by calling Joseph Clark at (202) 572-8768.

FOR FURTHER INFORMATION CONTACT: Millie Gleason, Office of Field 
Operations, Tel: (202) 344-1131.

SUPPLEMENTARY INFORMATION:

Public Participation

    Interested persons are invited to participate in this rulemaking by 
submitting written data, views, or arguments on all aspects of the 
interim rule. The Bureau of Customs and Border Protection (CBP) also 
invites comments that relate to the economic, environmental, or 
federalism effects that might result from this interim rule. Comments 
that will provide the most assistance to CBP in developing these 
procedures will reference a specific portion of the interim rule, 
explain the reason for any recommended change, and include data, 
information, or authority that supports such recommended change.

Background

Softwood Lumber Agreement

    On September 12, 2006, the Governments of the United States and 
Canada (the ``Parties'') signed a bilateral Softwood Lumber Agreement 
(``SLA 2006'') concerning trade in softwood lumber products. The scope 
of the SLA 2006 is limited to the softwood lumber products listed as 
covered by the Agreement in Annex 1A of that document. A copy of the 
SLA 2006 is available for public viewing on the website of the Office 
of the United States Trade Representative located at http://www.ustr.gov.
    The SLA 2006 entered into force on October 12, 2006, (effective 
date), as designated by the Parties in an exchange of letters 
certifying that certain conditions have been met pursuant to Article 
II.1 of the Agreement. Unless terminated according to the terms set 
forth in Article XX, the SLA 2006 will remain in force until October 
12, 2013, and may be extended by agreement of the Parties for an 
additional 2 years.
    The SLA 2006, in pertinent part requires:
    <bullet> The United States to retroactively revoke, in their 
entirety, any antidumping (AD) and countervailing duty (CVD) orders 
that relate to softwood lumber products beginning May 22, 2002 (the 
initiation date of the order) to the effective date of the Agreement, 
without the possibility of their reinstatement, and terminates all U.S. 
Department of Commerce proceedings related to the orders. The United 
States is also required to liquidate unliquidated entries subject to 
AD/CVD orders made on or after May 22, 2002, without regard to 
antidumping or countervailing duties, and with interest, pursuant to 19 
U.S.C. 1677g(b).
    <bullet> The United States to not initiate and/or take action 
concerning trade remedy investigations.
    <bullet> Canada to apply export measures to exports of Softwood 
Lumber Products to the United States. For example, Canada will impose 
either an export charge or an export charge coupled with a volume 
restraint on exports of softwood lumber products to the United States 
from each Region described in 5 the Agreement and issue Export Permits 
on each entry of softwood lumber products exported from Canada to the 
United States.

SLA 2006 Entry Requirements

    In addition to the entry and entry summary information otherwise 
required for importation into the United States, as per section 484 of 
the Tariff Act of 1930, as amended, (19 U.S.C. 1484), the SLA 2006 
obligates the United States to require that a U.S. importer provide 
specific information in connection with each entry of covered softwood 
lumber products from Canada. The information required under the SLA 
2006 includes the following data elements:
    (1) The Region of Origin of the softwood lumber product. The 
identified Regions are: Alberta, British Columbia (B.C.) Coast, B.C. 
Interior, Manitoba, Ontario, Saskatchewan, and Quebec. The regions 
designated as B.C. Coast and B.C. Interior are defined in Forest 
Regions and Districts Regulation, B.C. Reg, 123/2003, which is 
available for public viewing at http://www.qp.gov.bc.ca/statreg/reg/F/Forest/123_2003.htm.
    (2) The Export Permit Number issued by the Government of Canada for 
the shipment; and
    (3) The original paper Certificate of Origin issued by the Maritime 
Lumber Bureau, where applicable.

Exclusions From SLA 2006 Export Measures

    Article X of the SLA 2006 identifies lumber products that are first 
produced in certain Canadian provinces, or produced by specific 
companies, as excluded from the export measures set forth in the 
Agreement. Specifically, Article X provides that SLA 2006 export 
measures will not apply to the following products:
    (1) Softwood lumber products first produced in the Maritimes from 
logs originating in the Maritimes or State of Maine, that are:
    (i) Exported directly to the United States from a Maritime province 
or
    (ii) Shipped to a province that is not a Maritime province, and 
reloaded or further processed and subsequently exported to the United 
States, provided that the products are accompanied by an original 
Certificate of Origin issued by the Maritime Lumber Bureau. An original 
Certificate of Origin issued by the Maritime Lumber Bureau is a 
required entry summary document by CBP. The Certificate must 
specifically state that the corresponding CBP entries are for softwood 
lumber products first produced in the Maritimes from logs originating 
in the Maritimes or State of Maine;
    (2) Softwood lumber products first produced in the Yukon, Northwest 
Territories or Nunavut from logs originating therein; and
    (3) Softwood lumber products produced by the companies listed in 
Annex 10 of the SLA 2006.

Certificate of Origin From Maritime Lumber Bureau

    As the SLA 2006 requires softwood lumber products whose Region of 
Origin is the Maritimes to be accompanied by an original Certificate of 
Origin issued by the Maritime Lumber Bureau, and provides that the 
Certificate of Origin is a required entry summary document, CBP 
requires importers of this commodity to submit the original paper 
Certificate of Origin to CBP with the paper entry summary documentation 
(CBP Form 7501) for each entry. All other entries of softwood lumber 
products from Canada subject to the SLA 2006 may be filed 
electronically using the CBP Form e-7501.
    It is noted that the Certificate of Origin issued by the Maritime 
Lumber Bureau is distinct from the NAFTA

[[Page 61401]]

Certificate of Origin required under Sec.  181.22 of title 19 of the 
CFR.
    This interim regulation adds the Certificate of Origin to the 
``List of Records Required for the Entry of Merchandise'' set forth in 
the Appendix to part 163. The list, commonly referred to as the 
``(a)(1)(A) list,'' implements section 509(e) of the Trade Act of 1930, 
as amended (19 U.S.C. 1509(e)), whereby CBP is required to identify and 
publish a list of the records and entry information that is required to 
be maintained and produced under section 509(a)(1)(A) of the Tariff Act 
of 1930, as amended by title VI of Public Law 103-182 (19 U.S.C. 
1509(a)(1)(A)). Section 509(a)(1)(A) requires the production of 
records, within a reasonable time after demand by CBP, ``if such record 
is required by law or regulation for the entry of the merchandise 
(whether or not the Customs Service required its presentation at the 
time of entry).''

SLA 2006 Exchange of Information and Monitoring

    In order to facilitate monitoring of the SLA 2006, and in order to 
ensure that Canadian exporters have obtained the required export 
permits, the SLA 2006 also sets forth various cooperative measures 
which include the periodic exchange of export and import information 
collected by the two countries. The SLA 2006 also requires the Parties 
to establish Technical Working Groups to ensure the effective 
implementation and application of the export charges and the 
administration of the customs-related aspects of the Agreement, 
including export permits, volume restraints, data collection, and 
exchange of information.

CBP Entry Requirements Specific to Softwood Lumber Products From Canada 
in Revised 19 CFR 12.140

    The purpose of this document is to provide an appropriate 
regulatory context for the new requirements resulting from the SLA 
2006. As these requirements relate to a special class of imported 
products, CBP is of the view that a distinct provision pertaining to 
this commodity and its specific entry requirements is appropriate. As 
existing Sec.  12.140 of title 19 of the Code of Federal Regulations 
(CFR) contains obsolete provisions pertaining to a prior Softwood 
Lumber Agreement between the Governments of Canada and the United 
States that expired in March, 2001, this document amends, on an interim 
basis, Sec.  12.140 to set forth the entry requirements mandated by the 
SLA 2006, as discussed below.
    Section 12.140(a) sets forth definitions pertinent to the 
administration of this provision.
    Section 12.140(b) specifies the information required to be 
collected pursuant to the SLA 2006. Importers are required to enter a 
letter code representing the softwood lumber product's Canadian Region 
of Origin in the data entry field entitled ``Country of Origin'' 
located on the CBP Form 7501. Importers must also enter a Canadian-
issued 8-digit export permit number preceded by a letter code 
designating either: (1) The date of shipment; (2) a Canadian Region 
whose exports of softwood lumber products are exempt from the export 
measures contained in the SLA 2006; or (3) a company listed in Annex 10 
of the SLA 2006 as exempt from the Agreement's export measures.
    Section 12.140(c) states that where a softwood lumber product's 
Region of Origin is the Maritimes, the original paper Certificate of 
Origin issued by the Maritime Lumber Bureau must be submitted to CBP 
with the paper entry summary documentation.
    The letter codes described above are necessitated by the fact that 
the Canadian-issued Export Permit Number consists of eight digits, and 
the entry field for this data on the CBP Form 7501 holds nine digits. 
Accordingly, CBP uses an alpha-numeric code system whereby the first 
piece of data input into the Export Permit Number field on the CBP Form 
7501 is a letter code designating either an exclusion from export 
measures based on a product's Region of Origin or a company's exempt-
status, or the code is used to designate the date of shipment as 
defined in Article XXI.16 of the SLA 2006, in which the first twelve 
letters of the alphabet represent the twelve months of the year (e.g., 
``A'' represents January, ``B'' represents February, etc.). These codes 
enable the United States to fulfill its information collection and 
exchange obligations under Article XV of the Agreement by being able to 
assess monthly volumes attributable to specific Regions and excluded 
companies.
    It is also noted that the SLA 2006 recognizes two separate and 
distinct Canadian Regions comprising the territory of the Canadian 
Province of British Columbia. Article XXI.45 of the Agreement 
designates B.C. Coast and B.C. Interior as separate Regions for 
purposes of the SLA 2006. As noted above, the geographic boundaries of 
B.C. Coast and B.C. Interior are set forth in Forest Regions and 
Districts Regulation, B.C. Reg, 123/2003. The code ``XD'' is to be used 
to designate B.C. Coast in the ``Country of Origin'' data field on the 
CBP Form 7501. The code ``XE'' is to be used to designate B.C. 
Interior. These new codes, as well as the existing codes applicable to 
the other Regions designated in the SLA 2006, are posted on the 
Administrative Message Board in the Automated Commercial System (ACS). 
In addition, this information will be provided to all Automated Broker 
Interface (ABI) Administrative Message System filers.
    The requirement to submit these data elements to CBP goes into 
effect upon the date of filing of these interim amendments for public 
inspection in the Federal Register.
    As noted above, the ``List of Records Required for the Entry of 
Merchandise'' set forth in the Appendix to part 163 of title 19 of the 
CFR (19 CFR part 163) is amended by this document to reflect the entry 
document requirements mandated by the SLA 2006. Section IV of the 
Appendix currently lists 19 CFR 12.140 as the authority for the entry 
records requirements, ``Province of first manufacture, export permit 
number and fee status of softwood lumber from Canada.'' This document 
revises that requirement to state that Sec.  12.140(c) requires a 
``Certificate of Origin issued by Canada's Maritime Lumber Bureau.''

Comments

    Submitted comments will be available for public inspection in 
accordance with the Freedom of Information Act (5 U.S.C. 552) and Sec.  
103.11(b) of title 19 of the CFR (19 CFR 103.11(b)), on regular 
business days between the hours of 9 a.m. and 4:30 p.m. at the Trade 
and Commercial Regulations Branch, Office of Regulations and Rulings, 
Customs and Border Protection, 799 9th St., NW., Washington, DC. 
Arrangements to inspect submitted documents should be made in advance 
by calling Joseph Clark at (202) 572-8768.

Inapplicability of Notice and Delayed Effective Date Requirements

    Pursuant to 5 U.S.C. 553(a)(1), public notice and a delayed 
effective date are inapplicable to this interim regulation because it 
involves a foreign affairs function of the United States. The 
collection of information provided for in this interim regulation is 
required under the terms of the 2006 Softwood Lumber Agreement with 
Canada and is necessary to ensure effective monitoring of the operation 
of that Agreement.

Executive Order 12866

    Because this rule involves a foreign affairs function of the United 
States, it is not subject to Executive Order 12866 and has not been 
reviewed by the Office of Management and Budget.

[[Page 61402]]

Regulatory Flexibility Act

    Because no notice of proposed rulemaking is required for this 
interim rule, the provisions of the Regulatory Flexibility Act (5 
U.S.C. 601 et seq.) do not apply.

Paperwork Reduction Act

    The collection of information referenced in this regulation, CBP 
Form 7501, has been previously reviewed and approved by the Office of 
Management and Budget in accordance with the requirements of the 
Paperwork Reduction Act (44 U.S.C. 3507) under OMB-assigned control 
number 1651-0022.

Signing Authority

    This document is being issued in accordance with 19 CFR 0.1(a)(1).

List of Subjects

19 CFR Part 12

    Bonds, Customs duties and inspection, Entry of merchandise, 
Imports, Prohibited merchandise, Reporting and recordkeeping 
requirements, Restricted merchandise.

19 CFR Part 163

    Customs duties and inspection, Reporting and recordkeeping 
requirements.

Amendment to the Regulations

0
For the reasons stated above, parts 12 and 163 of title 19 of the Code 
of Federal Regulations are amended as set forth below.

PART 12--SPECIAL CLASSES OF MERCHANDISE

0
1. The authority citation for part 12 continues to read in part as 
follows:

    Authority: 5 U.S.C. 301; 19 U.S.C. 66, 1202 (General Note 3(i), 
Harmonized Tariff Schedule of the United States (HTSUS)), 1624.
* * * * *

0
2. Section 12.140 is revised to read as follows:


Sec.  12.140  Entry of softwood lumber products from Canada.

    The requirements set forth in this section are applicable for as 
long as the Softwood Lumber Agreement (SLA 2006), entered into on 
September 12, 2006, by the Governments of the United States and Canada, 
remains in effect.
    (a) Definitions. The following definitions apply for purposes of 
this section:
    (1) British Columbia Coast. ``British Columbia Coast'' means the 
Coastal Forest Regions as defined by the existing Forest Regions and 
Districts Regulation, B.C. Reg. 123/2003.
    (2) British Columbia Interior. ``British Columbia Interior'' means 
the Northern Interior Forest Region and the Southern Interior Forest 
Region as defined by the existing Forest Regions and Districts 
Regulation, B.C. Reg. 123/2003.
    (3) Date of shipment. ``Date of shipment'' means, in the case of 
products exported by rail, the date when the railcar that contains the 
products is assembled to form part of a train for export; otherwise, 
the date when the products are loaded aboard a conveyance for export. 
If a shipment is transshipped through a Canadian reload center or other 
inventory location, the date of shipment is the date the merchandise 
leaves the reload center or other inventory location for final shipment 
to the United States.
    (4) Maritimes. ``Maritimes'' means New Brunswick, Canada; Nova 
Scotia, Canada; Prince Edward Island, Canada; and Newfoundland and 
Labrador, Canada.
    (5) Region. ``Region'' means British Columbia Coast or British 
Columbia Interior as defined in paragraphs (a)(1) and (2) of this 
section; Alberta, Canada; Manitoba, Canada; Maritimes, Canada; 
Northwest Territories, Canada; Nunavut Territory, Canada; Ontario, 
Canada; Saskatchewan, Canada; Quebec, Canada; or Yukon Territory, 
Canada.
    (6) Region of Origin. ``Region of Origin'' means the Region where 
the facility at which the softwood lumber product was first produced 
into such a product is located, regardless of whether that product was 
further processed (for example, by planing or kiln drying) or was 
transformed from one softwood lumber product into another such product 
(for example, a remanufactured product) in another Region, with the 
following exceptions:
    (i) The Region of Origin of softwood lumber products first produced 
in the Maritime Provinces from logs originating in a non-Maritime 
Region will be the Region where the logs originated; and
    (ii) The Region of Origin of softwood lumber products first 
produced in the Yukon, Northwest Territories or Nunavut (the 
`Territories') from logs originating outside the Territories will be 
the Region where the logs originated.
    (7) SLA 2006. ``SLA 2006'' or ``SLA'' means the Softwood Lumber 
Agreement entered into between the Governments of Canada and the United 
States on September 12, 2006.
    (8) Softwood lumber products. ``Softwood lumber products'' mean 
those products described as covered by the SLA 2006 in Annex 1A of the 
Agreement.
    (b) Reporting requirements. In the case of softwood lumber products 
from Canada listed in Annex 1A of the SLA 2006, the following 
information must be included on the electronic entry summary 
documentation (CBP Form 7501) for each entry:
    (1) Region of Origin. The letter code representing a softwood 
lumber product's Canadian Region of Origin, as posted on the 
Administrative Message Board in the Automated Commercial System. (For 
example, the letter code ``XD'' designates softwood lumber products 
whose Region of Origin is British Columbia Coast. The letter code 
``XE'' designates softwood lumber products whose Region of Origin is 
British Columbia Interior.)
    (2) Export Permit Number. The 8-digit Canadian-issued Export Permit 
Number, preceded by one of the following letter codes:
    (i) The letter code assigned to represent the date of shipment 
(i.e., ``A'' represents January, ``B'' represents February, ``C'' 
represents March, etc.), except for those softwood lumber products 
produced by a company listed in Annex 10 of the SLA 2006 or whose 
Region of Origin is the Maritimes, Yukon, Northwest Territories or 
Nunavut;
    (ii) The letter code ``X'', which designates a company listed in 
Annex 10 of the SLA 2006; or
    (iii) The letter code assigned to represent the Maritimes (code M); 
Yukon (code Y); Northwest Territories (code W); or Nunavut (code N), 
for softwood lumber products originating in these regions.
    (c) Original Maritime Certificate of Origin. Where a softwood 
lumber product's Region of Origin is the Maritimes, the original paper 
copy of the Certificate of Origin issued by the Maritime Lumber Bureau 
must be submitted to CBP with the paper entry summary documentation for 
each entry. The Certificate of Origin must specifically state that the 
corresponding CBP entries are for softwood lumber products first 
produced in the Maritimes from logs originating in the Maritimes or 
State of Maine.
    (d) Recordkeeping. Importers must retain copies of export permits, 
certificates of origin, and any other substantiating documentation 
issued by the Canadian Government pursuant to the recordkeeping 
requirements set forth in part 163 of title 19 to the CFR.

[[Page 61403]]

PART 163--RECORDKEEPING

0
3. The authority citation for part 163 continues to read as follows:

    Authority: 5 U.S.C. 301; 19 U.S.C. 66, 1484, 1508, 1509, 1510, 
1624.


0
4. The Appendix to part 163 is amended by removing the listing for 
Sec.  12.140 and adding in its place Sec.  12.140(c) under section IV 
to read as follows:

Appendix to Part 163--Interim (a)(1)(A) List

* * * * *
    IV. * * *


Sec.  12.140(c)  Certificate of Origin issued by Canada's Maritime 
Lumber Bureau.

* * * * *

Chris J. Clark,
Acting Commissioner, Bureau of Customs and Border Protection.
    Approved: October 13, 2006.
Timothy E. Skud,
Deputy Assistant Secretary of the Treasury.
[FR Doc. 06-8761 Filed 10-16-06; 9:39 am]
BILLING CODE 9111-14-P