[Federal Register Volume 62, Number 249 (Tuesday, December 30, 1997)]
[Proposed Rules]
[Pages 67765-67770]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-33854]


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DEPARTMENT OF THE TREASURY

Customs Service

19 CFR Parts 123 and 142

RIN 1515-AC16


Land Border Carrier Initiative Program

AGENCY: Customs Service, Treasury.

ACTION: Notice of proposed rulemaking.

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SUMMARY: This document proposes to amend the Customs Regulations to 
provide for the Land Border Carrier Initiative Program (LBCIP), a 
program designed to prevent smugglers of illicit drugs from utilizing 
commercial land conveyances for their contraband. The program provides 
for agreements between carriers and Customs in which the carrier agrees 
to increase its security measures and cooperate more closely with 
Customs and Customs agrees to apply special administrative provisions 
pertaining to penalty amounts and expedited processing of penalty 
actions if illegal drugs are found on a conveyance belonging to the 
participating carrier. Further, at certain high-risk locations along 
the land border, it is proposed to condition an importer's continued 
use of the Line Release method of processing entries of merchandise on 
the use of carriers/drivers that participate in the LBCIP. These 
proposed regulatory changes are designed to improve Customs enforcement 
of Federal drug laws along the land border by enhancing its ability to 
interdict illicit drug shipments through additional trade movement 
information provided by common

[[Page 67766]]

carriers that voluntarily choose to participate in the LBCIP.

DATES: Comments must be received on or before March 2, 1998.

ADDRESSES: Written comments (preferably in triplicate) may be addressed 
to the Regulations Branch, Office of Regulations and Rulings, U.S. 
Customs Service, 1300 Pennsylvania Avenue, N.W., Washington, D.C. 
20229. Comments submitted may be inspected at the Regulations Branch, 
Office of Regulations and Rulings, U.S. Customs Service, 1300 
Pennsylvania Avenue, N.W., Suite 3000, Washington, D.C.

FOR FURTHER INFORMATION CONTACT: Jim Kelly, Office of Field Operations, 
Anti-Smuggling Division, (202) 927-0458.

SUPPLEMENTARY INFORMATION:

Background

I. Carrier Initiative Programs in General

    In 1984, Customs began an air and sea Carrier Initiative Program 
(CIP), generally in response to Customs awareness of a substantial 
increase in the smuggling of marijuana and cocaine in the South-Florida 
area, and specifically as a result of a Customs seizure of an aircraft 
operated by an American-flag carrier. The carrier, whose aircraft had 
been involved in repeated drug violations, agreed to a multi-point 
agreement implementing stringent security measures as a condition to 
release of the conveyance. Developed under Customs remission and 
mitigation of penalties authority pursuant to section 618 of the Tariff 
Act of 1930 (19 U.S.C. 1618), the CIP is grounded in the execution of 
written Carrier Initiative Agreements between Customs and the common 
carrier, whereby the carrier agrees to improve cargo and conveyance 
security, and Customs provides security and drug awareness training.
    Over the past ten years, the air and sea CIP has proved to be a 
marked success. Since that time, Customs has come to view carriers as 
allies in the war against drug smugglers, and expanded the CIP to 
include Super Carriers (see, 54 FR 14310, April 10, 1989). To date, 
over 2,300 air and sea carriers have voluntarily signed such Carrier 
Initiative Agreements with Customs.
    Because of the proven success of the air and sea CIP, in 1995 
Customs decided to expand the CIP to land border carriers to address 
the increased drug smuggling threat. This new Land Border Carrier 
Initiative Program (LBCIP) is designed to deter smugglers of illegal 
drugs from utilizing commercial land conveyances for their contraband. 
The exact locations along the Southwest border where the LBCIP will be 
implemented will be published in the Federal Register.
    In signing Carrier Initiative Agreements with Customs, land and 
rail carriers agree to increase the security measures at their places 
of business and on the conveyances used to transport cargo. Further, 
carriers agree to cooperate closely with Customs in identifying and 
reporting suspected smuggling conduct. In return for this cooperation, 
Customs agrees to provide training to carrier employees and drivers in 
the areas of cargo and personnel security, document review techniques, 
drug awareness, and conveyance search. Further, should illegal drugs be 
found aboard a conveyance belonging to a carrier that has executed an 
agreement with Customs, Customs agrees to apply special administrative 
provisions pertaining to penalty amounts and expedited processing of 
penalties. Of course, the degree of compliance with the terms of the 
Agreement by the carrier will be considered by Customs in any seizure 
or penalty decision or recommendation.

II. The Drug Interdiction Mandates of the Anti-Drug Abuse Acts

    In 1986, Congress enacted the Anti-Drug Abuse Act of 1986 (Pub. L. 
99-570, 100 Stat. 3207; 21 U.S.C. 801 note) (the 1986 Act) to, among 
other things, strengthen Federal efforts to improve the enforcement of 
Federal drug laws and enhance the interdiction of illicit drug 
shipments.
    The 1986 Act amended Customs laws relating to the assessment of 
monetary penalties against persons in charge of conveyances used as 
common carriers and the seizure and forfeiture of conveyances for the 
illegal importation or transportation of drugs. Congress subjected 
common carriers to increased penalties and sanctions for at least two 
reasons: (1) To encourage greater vigilance on the part of those in 
charge of conveyances used as common carriers; and (2) to increase the 
accountability and legal responsibility of carriers to insure that 
drugs were not carried on board their conveyances.
    In particular, the 1986 Act amended sections 584 and 594 of the 
Tariff Act of 1930 (19 U.S.C. 1584 and 1594). Section 584 was amended 
to increase the penalty provisions which could be assessed against 
owners, masters, or persons in charge of conveyances engaged as common 
carriers when unmanifested drugs were discovered on board vessels or in 
vehicles bound for the United States. The penalties, virtually 
unchanged since the 1930s, were increased 2,000%, i.e., from $25 per 
ounce of marijuana to $500 per ounce, and from $50 per ounce of heroin 
or cocaine to $1,000 per ounce.
    Further, the seizure and forfeiture provisions of section 594 were 
greatly expanded to include all common carrier conveyances and 
operators where prohibited merchandise was involved. Section 594 was 
amended to require a conveyance to be forfeited unless the owner, 
operator, or person in charge proves that he exercised the ``highest 
degree of care and diligence'' where violations involved prohibited 
merchandise contained in unmanifested packages or where the marks, 
numbers, weights, or quantities disagreed with the manifest, or where 
the merchandise was concealed in or on the conveyance but not in the 
cargo.
    Although the Customs laws hold common carriers to a high standard 
of care, Customs has provided guidance and training through the CIP to 
alleviate the harsh consequences of those laws in the face of a 
carrier's diligent and good faith effort to comply with them.

III. Customs Modernization, Trade Facilitation, and the Line Release 
Method of Merchandise Processing

    Pursuant to section 448(b) of the Tariff Act of 1930, as amended 
(19 U.S.C. 1448(b)), the Secretary of the Treasury is authorized to 
provide by regulation for the issuance of special permits for delivery 
prior to formal entry (``immediate delivery''). In the late 1980s, 
Customs established a new automated system for the expedited processing 
of repetitive, high volume entries of merchandise (``Line Release'') 
through the use of personal computers and bar code technology (see, 
T.D. 92-93). Regulations implementing the Line Release processing 
method are delineated at subpart D of Part 142 (Secs. 142.41-142.52), 
Customs Regulations (19 CFR Part 142, subpart D).
    Line Release facilitates the entry of merchandise along the land 
borders of the United States. However, at certain high-risk locations 
Customs does not wish to continue to offer line-release processing 
unless it can be assured that such will not compromise its various law 
enforcement and drug interdiction responsibilities. Balancing these 
concerns, Customs proposes that at certain high-risk land border 
locations, continued importer use of Line Release be conditioned on the 
imported merchandise being carried by participants in the LBCIP. The 
additional information made available to Customs by interfacing the

[[Page 67767]]

merchandise-data of Line Release with the cargo-driver-conveyance data 
of the LBCIP will enhance Customs ability to assess the threat of 
certain commercial transactions more effectively. Only with the 
continuing assistance of such participatory land border carriers, as 
shown by the success of the previous CIPs, can Customs be assured that 
every tool available to protect the United States borders from illicit 
drug traffic is employed before according the benefits of expedited 
merchandise processing by means of Line Release.

Proposed Amendments Concerning the LBCIP and Line Release

    In this document it is proposed to provide for the new LBCIP in 
Part 123 of the Customs Regulations, which pertains to Customs 
relations with Canada and Mexico, by adding a new Subpart H; the 
current subpart H which contains miscellaneous provisions will be 
redesignated as new subpart I. The new subpart H of Part 123 will 
consist of five sections (Secs. 123.71--123.75).
    Further, it is proposed to provide Customs with the discretion, at 
certain high-risk locations, to require for the use of Line Release 
that imported merchandise, which otherwise qualifies for Line Release, 
be transported over the border by carriers and drivers that participate 
in the LBCIP. Accordingly, two sections in subpart D (Secs. 142.41 and 
142.47) will be revised to reference that carrier participation in the 
LBCIP may be required by Customs for Line Release transactions at 
particular locations. The public will be informed of these locations by 
publications in the Federal Register. At this time Customs plans that 
these locations will be limited to those along the Southern border, 
where the greatest drug threat to the United States is located. This 
limited implementation of the LBCIP is designed to reduce the threat to 
public safety presented by the drug problem in that area.
    It is noted that participation in either the LBCIP or the Line 
Release program does not alter the general authority of Customs 
officials to conduct inspections of participating carriers or their 
merchandise.

Discussion of Proposed Changes to Regulations

Proposed New Section 123.71

    Proposed Sec. 123.71, entitled ``Description of program'', 
describes, in general terms, the responsibilities of participants in 
the LBCIP, and cross references subpart D, Part 142 of the Customs 
Regulations, which provides for expedited processing of repetitive 
entries by means of Line Release, to indicate that, at certain high-
risk locations (the locations to be published in the Federal Register), 
Customs may require for the use of Line Release that imported 
merchandise, which otherwise qualifies for Line Release, be transported 
over the border by carriers and drivers that participate in the LBCIP.

Proposed New Section 123.72

    Proposed Sec. 123.72, entitled ``Written agreement requirement'', 
explains the mutual obligations of LBCIP carriers/drivers and Customs. 
A carrier wishing to participate in the LBCIP must agree to assume 
certain security responsibilities and a continuing reporting obligation 
to Customs regarding material changes to its operations. These material 
changes include changes to the structure and relationships of the 
carrier's business enterprise and associations, the list of drivers 
designated or conveyances registered by the carrier within the 
agreement to transport merchandise into the United States, or any other 
circumstance that affects the basis of the carrier to participate in 
the LBCIP. In return, Customs agrees to train carrier personnel and 
designated drivers, and to consider the application of special 
administrative procedures when assessing and mitigating drug-related 
penalties should controlled substances be found aboard a conveyance 
owned or operated by a participating carrier.

Proposed New Section 123.73

    Proposed Sec. 123.73, entitled ``Application to participate'', 
provides that the application is prepared by the carrier, with 
pertinent information provided by those drivers designated for 
participation in the program, and delineates the four items of 
information needed by Customs to process a request by carriers and 
their designated drivers to participate in the program at specific 
ports. The descriptive information required pertains to (1) general 
business identification and the condition of the business site; (2) 
designated drivers; (3) conveyance identification; and (4) an affidavit 
of business character. The driver and conveyance information sought is 
to enable Customs to conduct background checks and to aid Customs 
officers at the border crossing in visually identifying LBCIP-
authorized drivers and LBCIP-registered conveyances. The affidavit of 
business character requirement is designed to provide sufficient 
business background information for Customs to determine if the 
applicant possesses the requisite business integrity to be given access 
to Line Release entry processing. Accordingly, applicants will be 
required to provide complete business histories to Customs, i.e., 
account for business name changes, reasons for relocations, etc.

Proposed New Section 123.74

    Proposed Sec. 123.74, entitled ``Notice of selection; appeal of 
determination'', provides that Customs shall provide written notice to 
carrier-applicants concerning their participation in the LBCIP. 
(Customs will provide written notice to individual designated drivers 
only in cases where they are not selected to participate in the LBCIP.) 
This section also lists the grounds for nonselection and references the 
agency appeal procedures, described at proposed Sec. 123.75, that 
carriers/drivers must follow if they wish to appeal the decision of 
nonselection.

Proposed New Section 123.75

    Proposed Sec. 123.75, entitled ``Notice of revocation; appeal of 
decision'', explains the circumstances under which Customs may 
terminate a carrier's or driver's participation in the LBCIP. This 
section also describes the agency appeal procedures carriers/drivers 
must follow if they wish to challenge revocation of their participation 
in the LBCIP.

Proposed Amendments to Sections 142.41 and 142.47

    Section 142.41, which explains Line Release in general terms, and 
Sec. 142.47, which concerns the voiding of Line Release transactions, 
are being revised to indicate that, at certain high-risk locations (the 
locations to be published in the Federal Register), Customs may require 
for the use of Line Release that imported merchandise, which otherwise 
qualifies for Line Release, be transported over the border by carriers 
and drivers that participate in the LBCIP.

Comments

    Before adopting this proposed regulation as a final rule, 
consideration will be given to any written comments timely submitted to 
Customs. Comments submitted will be available for public inspection in 
accordance with the Freedom of Information Act (5 U.S.C. 552), Sec. 1.4 
of the Treasury Department Regulations (31 CFR 1.4), and Sec. 103.11(b) 
of the Customs Regulations (19 CFR 103.11(b)), on regular business days 
between the hours of 9 a.m. and 4:30 p.m. at the Regulations Branch, 
Office of Regulations and Rulings, U.S. Customs Service, 1300 
Pennsylvania Avenue, N.W., Suite 3000, Washington, D.C.

[[Page 67768]]

Inapplicability of the Regulatory Flexibility Act, and Executive Order 
12866

    Pursuant to provisions of the Regulatory Flexibility Act (5 U.S.C. 
601 et seq.), it is certified that, if adopted, the proposed amendments 
will not have a significant economic impact on a substantial number of 
small entities, because the proposed amendments concern a voluntary 
program that will confer a benefit on the trade community. Accordingly, 
the proposed amendments are not subject to the regulatory analysis or 
other requirements of 5 U.S.C. 603 and 604. This amendment does not 
meet the criteria for a ``significant regulatory action'' as specified 
in Executive Order 12866.

Paperwork Reduction Act

    The collection of information contained in this notice of proposed 
rulemaking has been submitted to the Office of Management and Budget 
(OMB) for review in accordance with the Paperwork Reduction Act of 1995 
(44 U.S.C. 3507). Comments on the collection of information should be 
sent to the Office of Management and Budget, Attention: Desk Officer 
for the Department of the Treasury, Office of Information and 
Regulatory Affairs, Washington, D.C. 20503. A copy should also be sent 
to Customs at the address set forth previously.
    Comments are invited on:
    (a) Whether the collection of information is necessary for the 
proper performance of the functions of the agency, including whether 
the information shall have practical utility;
    (b) The accuracy of the agency's estimate of the information 
collection burden;
    (c) Ways to enhance the quality, utility, and clarity of the 
information to be collected;
    (d) Ways to minimize the information collection burden on 
respondents, including through the use of automated collection 
techniques or other forms of information technology; and
    (e) Estimates of capital or startup costs and costs of operations, 
maintenance, and purchase of services to provide information.
    An agency may not conduct or sponsor, and a person is not required 
to respond to, a collection of information unless the collection of 
information displays a valid control number.
    The collection of information in these proposed regulations is at 
Sec. 123.73. The information to be collected is necessary to improve 
Customs ability to interdict illicit drug shipments along the land 
border in cooperation with common carriers and their designated drivers 
who participate in the LBCIP. The likely respondents are individual 
drivers and commercial carrier organizations that engage in foreign 
commerce and trade along the land border of the United States.
    Estimated total annual reporting and/or recordkeeping burden: 500 
hours.
    Estimated average annual burden per respondent/ recordkeeper: 1 
hour.
    Estimated number of respondents and/or recordkeepers: 500.
    Estimated annual frequency of responses: 1.
    Part 178 of the Customs Regulations (19 CFR Part 178), which lists 
the information collections contained in the regulations and control 
numbers assigned by OMB, would be amended accordingly if this proposal 
is adopted.
    Drafting Information: The principal author of this document was 
Gregory R. Vilders, Attorney, Regulations Branch. However, personnel 
from other offices participated in its development.

List of Subjects

19 CFR Part 123

    Administrative practice and procedure, Aliens, Canada, Common 
carriers, Customs duties and inspection, Forms, Imports, International 
boundaries, Mexico, Motor carriers, Railroads, Reporting and 
recordkeeping requirements, Vehicles.

19 CFR Part 142

    Bonds, Common carriers, Customs duties and inspection, Entry of 
merchandise, Forms, Reporting and recordkeeping requirements.

Amendments to the Regulations

    For the reasons stated above, it is proposed to amend parts 123 and 
142 of the Customs Regulations (19 CFR parts 123 and 142), as set forth 
below:

PART 123--CUSTOMS RELATIONS WITH CANADA AND MEXICO

    1. The general authority citation for part 123 continues to read as 
follows, the specific authority citation for Sec. 123.71 is removed, 
and specific authority citations for Secs. 123.71 through 123.75 and 
for Sec. 123.81 are added, to read as follows:

    Authority: 19 U.S.C. 66, 1202 (General Note 20, Harmonized 
Tariff Schedule of the United States (HTSUS)), 1431, 1433, 1624.
* * * * *
    Sections 123.71-123.75 also issued under 19 U.S.C. 1618; Section 
123.81 also issued under 19 U.S.C. 1595.

    2. Subpart H is redesignated as subpart I and Secs. 123.71 and 
123.72 are redesignated as Secs. 123.81 and 123.82 therein, 
respectively, and a new subpart H, consisting of Secs. 123.71 through 
123.75, is added to read as follows:

Subpart H--Land Border Carrier Initiative Program


Sec. 123.71  Description of program.

    The Land Border Carrier Initiative Program (LBCIP) is a program 
designed to enlist the voluntary cooperation of commercial conveyance 
entities--and their designated drivers--in Customs effort to prevent 
the smuggling of controlled substances into the United States. 
Participation in the LBCIP requires the land or rail commercial carrier 
(e.g., trucks, buses, locomotives, etc.) to enter into a written 
agreement with Customs that describes the responsibilities of 
participants in the LBCIP. The agreement generally provides that the 
carrier agrees to enhance the security of its facilities and the 
conveyances employed to transport merchandise. The carrier also agrees 
to cooperate closely with Customs in identifying and reporting 
suspected smuggling attempts. In exchange for this cooperation, Customs 
agrees to provide training to carrier personnel in the areas of cargo 
and personnel security, document review techniques, drug awareness, and 
conveyance searches. Customs also agrees that should a controlled 
substance be found aboard a conveyance owned or operated by a 
participating carrier, special administrative procedures relating to 
the assessment and mitigation of drug-related penalties will be 
followed; the degree of compliance with the terms of the agreement will 
be considered as an additional positive mitigating factor in any 
seizure or penalties decision or recommendation. Lastly, at certain 
high-risk locations, for the use of Line Release, imported merchandise, 
which otherwise qualifies for Line Release entry (see, subpart D of 
part 142 of this chapter), must be transported over the border by 
carriers and drivers that participate in the LBCIP. The locations where 
the use of Line Release will be conditioned on participation in the 
LBCIP will be published in the Federal Register.


Sec. 123.72  Written agreement requirement.

    Commercial carriers desiring to participate in the LBCIP shall 
enter into a written agreement with Customs regarding the mutual 
obligations of carrier/driver participants and Customs. The terms and 
conditions in the written agreement shall generally provide that the 
carrier-applicant agrees:

[[Page 67769]]

    (a) To participate in Customs training regarding cargo and 
personnel security, document review techniques, drug awareness, and 
conveyance searches;
    (b) To establish (1) security systems at the place of business for 
the safe storage and handling of cargo intended to be imported into the 
United States, and (2) security procedures aimed at restricting access 
to transporting conveyances and preventing the unauthorized lading of 
illegal drugs while the conveyance is enroute to the United States;
    (c) To conduct, to the extent allowed by law, employment and 
criminal history record checks on all personnel designated to 
participate in the LBCIP and to exercise responsible supervision and 
control over those personnel;
    (d) To ensure that only authorized drivers and properly registered 
conveyances are utilized in the transportation of merchandise into the 
United States, and to maintain current lists of such drivers and 
conveyances for Customs inspection upon request;
    (e) To immediately report to the appropriate port director any 
criminal or dishonest conduct on the part of drivers designated to 
participate in the LBCIP, or attempt by others to impede, influence, or 
coerce the carrier or drivers into violating any United States law, 
including Customs regulations, especially those concerned with 
trafficking in illegal drugs; and
    (f) To notify the appropriate port director in writing by mail 
within 5 days of any change in legal name, business address, business 
principals, ownership, drivers, or conveyances that affects the basis 
for continued participation in the LBCIP or any other provision 
contained in the written agreement.


Sec. 123.73  Application to participate.

    To request participation in the LBCIP, the carrier-applicant must 
submit an application containing the information requested in this 
section. The application must be accompanied by two copies of a LBCIP 
written agreement (see Sec. 123.72 of this part; upon request, the 
local port director of Customs will provide copies of an unsigned 
written agreement) containing original signatures of corporate officers 
or owners of the common carrier. The application shall be prepared by 
the common carrier, be signed by corporate officers or owners, and 
submitted to the port director. If a submitted application does not 
provide all of the information specified in this section, the 
processing of the application will either be delayed or the application 
will be rejected. The application information shall include the 
following information:
    (a) General business identification and site condition information. 
The name and address of the commercial conveyance entity, the names of 
all principals or corporate officers, the name and telephone number of 
an individual to be contacted for further information, and a complete 
and detailed description of the premises where business operations are 
conducted, to include all working/storage areas and security features 
employed;
    (b) Designated driver information. A listing of the drivers 
designated by the carrier who will be transporting merchandise into the 
U.S. The listing shall set forth the name(s), address(es), date of 
birth, nationality, driver's license number, and any other personal 
identifying information regarding the drivers listed, e.g., social 
security number (if available), to enable Customs to conduct background 
checks and to aid Customs officers at the border crossing point in 
identifying individual LBCIP-authorized drivers;
    (c) Conveyance identification information. A listing of the 
conveyances, e.g., trucks and locomotives, that the carrier will 
utilize to transport merchandise into the U.S. The listing shall set 
forth the type and make of conveyances, country of registration and 
license number(s), conveyance-specific identifying markings, e.g., 
vehicle identification numbers (VINs), and any other general conveyance 
identifying information, e.g., weight, color, recognizable 
modifications, etc., to aid Customs officers at the border crossing 
point in identifying particular LBCIP-registered conveyances; and
    (d) Affidavit of business character. A statement signed by the 
carrier-applicant which attests to each principal's or corporate 
officer's past and present business relations, e.g., a list of past 
companies worked for and positions held, which fully explains the 
presence of any past or present crime involving theft or smuggling or 
investigations into such crimes, or other dishonest conduct on the part 
of a principal.


Sec. 123.74  Notice of selection; appeal of determination.

    The information provided pursuant to paragraphs (b) through (d) of 
Sec. 123.73 shall constitute the criteria used to evaluate the 
competency of the carrier-applicant and its designated drivers to 
participate in the LBCIP. Following Customs evaluation of the 
information provided, Customs shall determine the carrier-applicant's 
and its designated drivers' ability to participate in the LBCIP. In 
cases of selection, Customs will notify the common carrier in writing 
and sign and return one of the copies of the written agreement. In 
cases of nonselection, the written notice of nonselection shall clearly 
state the reason(s) for denial and recite the applicant's/driver's 
appeal rights under paragraph (b) of this section.
    (a) Grounds for nonselection. The port director may deny a 
carrier's application, or a driver's designation, to participate in the 
LBCIP for any of the following reasons:
    (1) Evidence of any criminal or dishonest conduct involving the 
carrier, a corporate officer, designated drivers, or other person the 
port director determines is exercising substantial ownership or control 
over the carrier operation or corporate officer;
    (2) Evidence of improper use of designated conveyances;
    (3) Evidence that the written agreement was entered into by fraud 
or misstatement of a material fact; or
    (4) A determination is made that the grant of LBCIP privileges 
would endanger the revenue or security of the Customs area.
    (b) Appeal of determination. Carrier-applicants and designated 
drivers not selected to participate in the LBCIP and who wish to appeal 
the decision shall either:
    (1) Appeal the adverse determination in accordance with the appeal 
procedure set forth in Sec. 123.75(c) of this part; or
    (2) Cure any deficiency in the first application by submitting a 
new application to the port director who denied the previous 
application after waiting 60 days from the date of issuance of the 
first determination.


Sec. 123.75  Notice of revocation; appeal of decision.

    (a) Revocation. The port director may immediately revoke a 
carrier's participation in the LBCIP and cancel the written agreement, 
or a driver's authorization to participate in the LBCIP, for any of the 
following applicable reasons:
    (1) The selection and written agreement were obtained through fraud 
or the misstatement of a material fact by the carrier;
    (2) The carrier, a corporate officer, any designated driver, or 
other person the port director determines is exercising substantial 
ownership or control over the carrier operation or corporate officer, 
is indicted for, convicted of, or has committed acts which would 
constitute any felony or misdemeanor under United States Federal or 
State law. In the absence of an indictment,

[[Page 67770]]

conviction, or other legal process, the port director must have 
probable cause to believe the proscribed acts occurred;
    (3) The carrier-participant or a designated driver allows an 
unauthorized person or entity to use its LBCIP certificate or other 
approved form of identification;
    (4) The carrier-participant or a designated driver misuses 
authorized conveyances;
    (5) The carrier-participant or a designated driver refuses or 
otherwise fails to follow any proper order of a Customs officer or any 
Customs order, rule, or regulation relative to continued participation 
in the LBCIP;
    (6) The carrier-participant or a designated driver fails to operate 
in accordance with the terms of the written agreement; or
    (7) Continuation of LBCIP privileges would endanger the revenue or 
security of the Customs area in the judgment of the port director.
    (b) Notice. When a decision revoking participation has been made, 
the port director shall notify the carrier-participant, and, where 
appropriate, the individual designated driver(s), of the decision in 
writing. The notice of revocation shall clearly state the reason(s) for 
revocation and recite the applicant's/driver's appeal rights under 
paragraph (c) of this section.
    (c) Appeal. An LBCIP participant who receives a notice of 
revocation and who wishes to appeal the decision shall file a written 
appeal with the Assistant Commissioner, Office of Field Operations, 
U.S. Customs Service, Washington, D.C. 20229, within 10 calendar days 
of receipt of the notice. The appeal shall be filed in duplicate and 
shall set forth the participant's responses to the grounds specified by 
the port director in the notice. Within 30 working days of receipt of 
the appeal, the Assistant Commissioner, or his designee, shall make a 
determination regarding the appeal and notify the applicant in writing.

PART 142--ENTRY PROCESS

    1. The authority citation for part 142 continues to read as 
follows:

    Authority: 19 U.S.C. 66, 1448, 1484, 1624.

    2. Section 142.41 is amended by adding a sentence at the end to 
read as follows:


Sec. 142.41  Line release.

 * * * * *
    At certain high-risk locations along the land borders of the United 
States (the locations to be published in the Federal Register), which 
are approved by Customs for handling Line Release, the use of Line 
Release may be denied by Customs unless the imported merchandise is 
transported by carriers and drivers that participate in the Land Border 
Carrier Initiative Program (see, subpart H of part 123 of this 
chapter).


Sec. 142.47  [Amended]

    3. In Sec. 142.47, the first sentence of paragraph (b) is amended 
by removing the words ``because of an examination'' and adding, in 
their place, the words ``for the following reasons: because of an 
examination, because a carrier transporting the Line Release 
merchandise is not a participant in the Land Border Carrier Initiative 
Program (LBCIP), or because a driver or conveyance is not authorized in 
accordance with the LBCIP''.
Samuel H. Banks,
Acting Commissioner of Customs.

    Approved: August 7, 1997.
Dennis M. O'Connell,
Acting Deputy Assistant Secretary of the Treasury.
[FR Doc. 97-33854 Filed 12-29-97; 8:45 am]
BILLING CODE 4820-02-P