8620 Federal Register / Vol. 62, No. 38 / Wednesday, February 26, 1997 / Rules and Regulations

5. On page 922, in the second column,

in § 1314.6, paragraph (b)(2), line five,

the words ‘‘security account’’ are

corrected to read ‘‘Security Account’’.

§ 1314.8 [Corrected]

6. On page 922, in the third column,

in § 1314.8, line fourteen, the word

‘‘number’’ is corrected to read

‘‘Number’’.

Dated: February 11, 1997.

John L. Dugger,

Assistant General Counsel.

[FR Doc. 97–4744 Filed 2–25–97; 8:45 am]

BILLING CODE 8120–01–M

DEPARTMENT OF THE TREASURY

Customs Service

19 CFR Parts 12 and 113

[T.D. 97–9]

RIN 1515–AB97

Entry of Softwood Lumber Shipments

From Canada

AGENCY: U.S. Customs Service,

Department of the Treasury.

ACTION: Interim regulations; solicitation

of comments.

SUMMARY: This document sets forth

interim amendments to the Customs

Regulations establishing additional

entry requirements applicable to

shipments of softwood lumber from

Canada. The interim amendments

involve the collection of certain

additional information for purposes of

monitoring and enforcing an agreement

between the Governments of the United

States and Canada regarding trade in

softwood lumber.

DATES: Interim rule effective February

26, 1997; comments must be submitted

by April 28, 1997.

ADDRESSES: Written comments

(preferably in triplicate) may be

addressed to the Regulations Branch,

U.S. Customs Service, Franklin Court,

1301 Constitution Avenue, NW.,

Washington, DC 20229. Comments

submitted may be inspected at the

Regulations Branch, Office of

Regulations and Rulings, Franklin

Court, 1099 14th Street, NW., Suite

4000, Washington, DC.

FOR FURTHER INFORMATION CONTACT: Gary

Manes, Office of Field Operations (202–

927–1133).

SUPPLEMENTARY INFORMATION:

Background

On May 29, 1996, the United States

entered into the Softwood Lumber

Agreement (the Agreement) with

Canada under the authority of section

301(c)(1)(D) of the Trade Act of 1974, as

amended (19 U.S.C. 2411(c)(1)(D)),

which authorizes the United States

Trade Representative (the USTR) to

‘‘enter into binding agreements’’ with a

foreign country that commit the foreign

country to, inter alia, eliminate any

burden or restriction on U.S. commerce

resulting from an act, policy or practice

of the foreign country. The Agreement,

which went into effect on April 1, 1996,

was specifically intended to provide a

satisfactory resolution to certain acts,

policies and practices of the

Government of Canada affecting exports

to the United States of softwood lumber

which had been the subject of an

investigation initiated by the USTR

under section 302(b)(1)(A) of the Trade

Act of 1974, as amended (19 U.S.C.

2412(b)(1)(A)), and which on October 4,

1991, pursuant to section 304(a) of the

Trade Act of 1974, as amended (19

U.S.C. 2414(a)), had been found by the

USTR to be unreasonable and to burden

or restrict U.S. commerce. The

Agreement is the product of a

consultative process established by the

United States and Canada and involving

the participation of the U.S.

Government, Canadian federal and

provincial governments and, where

appropriate, industries and other

interested parties in both countries.

The Agreement refers specifically to

softwood lumber mill products

classified in subheadings 4407.10.00,

4409.10.10, 4409.10.20, and 4409.10.90

of the Harmonized Tariff Schedule of

the United States (HTSUS) that were

‘‘first manufactured’’ into a product of

one of those HTSUS subheadings in the

Canadian provinces of Ontario, Quebec,

British Columbia or Alberta. The

Agreement requires that Canada assess

fees on exports of such softwood lumber

in each of the five years following April

1, 1996, based on the following

schedule: (1) For total shipments up to

14.7 billion board feet, free (no fee); (2)

for any amount shipped in excess of

14.7 billion board feet but not in excess

of 15.35 billion board feet, US$50 per

thousand board feet in the first year and

with annual adjustments for inflation in

subsequent years; and (3) for any

amount shipped in excess of 15.35

billion board feet, US$100 per thousand

board feet and with annual adjustments

for inflation in subsequent years. The

Agreement also allows an additional

amount of exports of such softwood

lumber in excess of 14.7 billion board

feet without the payment of a fee if the

average price of a benchmark softwood

lumber price exceeds a prescribed

‘‘trigger price’’ during any quarterly

period. In order to control and monitor

exports of softwood lumber first

manufactured in Ontario, Quebec,

British Columbia and Alberta, the

Agreement provides that Canada will

issue an export permit for each

shipment of such softwood lumber and

that Canada will collect any required fee

for amounts of lumber exported in

excess of 14.7 billion board feet upon

issuance of the export permit.

The Agreement requires the collection

of information by Canada in connection

with the issuance of export permits for

softwood lumber first manufactured in

Ontario, Quebec, British Columbia and

Alberta and the collection of

information by the United States in

connection with import transactions

involving such lumber.

With regard to the import end, the

Agreement obligates the United States to

require that the U.S. importer provide

specific information in connection with

the entry of the lumber under section

484 of the Tariff Act of 1930, as

amended (19 U.S.C. 1484). The

information required to be collected

under the Agreement includes the

following three specific data elements

which are not already required under

the Customs laws and regulations, the

last two of which are required by the

Agreement to be collected as soon as

practicable after the entry into force of

the Agreement: (1) The province of first

manufacture of the lumber; (2) the

export permit number issued in Canada

for the shipment; and (3) the fee status

of the lumber for which the export

permit was issued (whether the lumber

in the shipment was attributed to a

quantity to which no fee applies or to

a quantity that is subject to the US$50

fee or to a quantity that is subject to the

US$100 fee or to a quantity that is

covered by the trigger price

mechanism).

In order to facilitate monitoring of the

Agreement and in order to ensure that

Canadian exporters have obtained the

appropriate permits, the Agreement also

sets forth various cooperative measures

which include the periodic exchange of

export and import information collected

by the two countries under the

Agreement.

On June 5, 1996, the USTR published

a notice in the Federal Register (61 FR

28626) setting forth its determination

that the Agreement will be subject to the

provisions of section 306 of the Trade

Act of 1974, as amended (19 U.S.C.

2416), and that the USTR will monitor

Canadian compliance with the

Agreement pursuant to section 306 and

will take action under section 301(a) of

the Trade Act of 1974, as amended (19
Federal Register / Vol. 62, No. 38 / Wednesday, February 26, 1997 / Rules and Regulations 8621

U.S.C. 2411(a)), if Canada fails to

comply with the Agreement. Noting that

adherence to the terms of the Agreement

is vital to the achievement of its

objectives, and consistent with the

authority conferred on the USTR by

section 141 of the Trade Act of 1974, as

amended (19 U.S.C. 2171), to coordinate

and draw upon the resources of other

Federal agencies in connection with the

performance of functions of the USTR

regarding the proper administration and

execution of trade agreement programs

(including those arising out of unfair

trade practice cases), the notice stated

that the USTR, the Department of

Commerce, Customs, and other agencies

as appropriate, will carefully monitor

and vigorously enforce the Agreement

and that, to that end, Customs will

provide to the USTR and to the

Department of Commerce the data that

Customs collects on imports (including

province of origin and the type of

permit) of softwood lumber from

Canada.

The purpose of this document is to

provide an appropriate regulatory

context for the new requirements

resulting from the Agreement as

discussed above. Since those

requirements relate to a special class of

imported products, Customs believes

that it would be appropriate to add to

Part 12 of the Customs Regulations (19

CFR Part 12) a new § 12.140 to cover the

Agreement provisions at issue.

Paragraph (a) of new § 12.140 reflects

the basic onus that the Agreement

places on exports of Canadian softwood

lumber that are subject to the export

permit and fee requirements and, by

implication, on the U.S. importer (see

also the below discussion of the changes

to the bond provisions of Part 113 of the

regulations). These paragraph (a)

provisions are necessary to ensure that

the basic purpose of the Agreement (the

collection of export fees on appropriate

shipments) is achieved.

Paragraph (b) of new § 12.140

specifies the information required to be

collected pursuant to the Agreement.

With regard to data concerning province

of first manufacture, the regulatory text

provides for submission of such data for

all entries of softwood lumber products

from Canada (rather than only those

products first manufactured in Ontario,

Quebec, British Columbia, or Alberta)

because, in order to effectively

determine if lumber is being entered

with a false claim of province or

territory of first manufacture so as to

contravene the terms of the Agreement,

it is necessary to be able to compare the

entered quantity of lumber not only to

the productive capacity of the claimed

province or territory of first manufacture

but also to the productive capacity of

other provinces or territories.

Paragraph (c) of new § 12.140

addresses the untimely issuance of

export permit numbers by the Canadian

Government. In recognition of the fact

that processing or other procedural

delays may arise in connection with the

issuance of export permit numbers, this

paragraph provides for up to 10

additional working days to file the entry

summary documentation setting forth

the information required under the

Agreement if the Canadian Government

has not issued the export permit number

within the 10-day filing period

prescribed in § 142.12(b) or § 142.23 of

the regulations. If the export permit

number is not issued within the

maximum 20-working-day period

allowed under this paragraph, the text

requires that the entry summary

documentation be filed on the next

(21st) business day with surrogate

information inserted in place of the

actual data in the export permit number

and export fee payment status fields.

The use of surrogate information in such

cases is only intended to enable the

importer to effect an entry summary

filing (in particular electronically) and

thus does not absolve an importer from

his other responsibilities under the

regulatory texts implementing the

Agreement. The provision in this

paragraph regarding the additional 10-

working-day period for filing the entry

summary documentation is at this point

intended to be a temporary measure,

and the need for retaining this provision

within the new regulatory texts will be

reviewed by the United States no later

than April 1, 1997, in the context of a

review of the overall operation of the

Agreement and the interim regulations

set forth in this document.

Finally, as an interim arrangement,

paragraph (d) of new § 12.140 provides

that an importer is not required to

declare the number or type of export

permit issued by Canada with respect to

softwood lumber products that are

imported into Canada, processed in

Canada, and then exported to the United

States; surrogate information also would

be used instead in such cases. This

exception to the paragraph (b)

requirements has been included because

the Government of Canada has to date

not agreed to issue export permits for

such remanufactured products because

it takes the position that they are not

covered by the Agreement; it is the

position of the U.S. Government that

such products are covered by the

Agreement. Discussions with the

Government of Canada are ongoing to

ensure that the export permit and other

requirements of the Agreement will be

applied to these remanufactured

products, and the need for retaining this

exception within the new regulatory

texts also will be reviewed by the

United States no later than April 1,

1997. The volume of imports of

remanufactured lumber historically has

been small and, as a practical matter, it

is expected that any future imports of

such products would only involve

certain specialty items. Customs notes

that for any import transaction in which

this exception is applied, the U.S.

importer must maintain, and make

available for Customs review when

requested, appropriate records to

establish that the exception was

properly applied to the imported

product. The use of this exception will

be closely examined by Customs, and

any filing of false information regarding

the applicability of this exception may

give rise to the assessment of penalties

under section 592 of the Tariff Act of

1930, as amended (19 U.S.C. 1592).

This document also includes

amendments to § 113.62 of the Customs

Regulations (19 CFR 113.62) which sets

forth the basic importation and entry

bond conditions and consequences of

default thereof. These amendments

involve: (1) The addition of a bond

condition as new paragraph (k) to reflect

the importer’s obligation under

paragraph (a) of new § 12.140; and (2) in

redesignated paragraph (l) (formerly

paragraph (k)), the addition of a new

paragraph (5) to set forth the

consequences of a default on the new

paragraph (k) bond condition, which

would be liquidated damages in an

amount equal to the highest export fee

provided for under the Agreement.

In consideration of the fact that the

data required under the regulatory text

set forth in this document is required for

the entry of the subject merchandise, the

interim ‘‘(a)(1)(A) list’’ published in the

Federal Register on July 15, 1996 (61 FR

36956) pursuant to 19 U.S.C.

1509(a)(1)(A) will be modified

accordingly.

Comments

Before adopting this interim

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), § 1.4, Treasury Department

Regulations (31 CFR 1.4), and

§ 103.11(b), 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, Franklin Court, 1099 14th
8622 Federal Register / Vol. 62, No. 38 / Wednesday, February 26, 1997 / Rules and Regulations

Street, N.W., Suite 4000, Washington,

DC.

Inapplicability of Notice and Delayed

Effective Date Requirements

Pursuant to the provisions of 5 U.S.C.

553(a), public notice is inapplicable to

this interim regulation because it is

within the foreign affairs function of the

United States. The collection of

information provided for in this interim

regulation is required under the terms of

the Softwood Lumber Agreement with

Canada and is necessary to ensure

effective monitoring of the operation of

that Agreement. Furthermore, for the

same reasons and because the collection

of this information is required to begin

as soon as practicable after entry into

force of the Softwood Lumber

Agreement, it is determined that good

cause exists under the provisions of 5

U.S.C. 553(d)(3) for dispensing with a

delayed effective date.

Executive Order 12866

Because this document involves a

foreign affairs function of the United

States and implements an international

agreement, it is not subject to the

provisions of E.O. 12866.

Regulatory Flexibility Act

Because no notice of proposed

rulemaking is required for interim

regulations, the provisions of the

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

et seq.) do not apply.

Paperwork Reduction Act

This regulation is being issued

without prior notice and public

procedure pursuant to the

Administrative Procedure Act (5 U.S.C.

553). For this reason, the collection of

information contained in this regulation

has been reviewed and, pending receipt

and evaluation of public comments,

approved by the Office of Management

and Budget in accordance with the

requirements of the Paperwork

Reduction Act (44 U.S.C. 3507) under

control number 1515–0065.

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

regulations is in § 12.140. This

information is required in connection

with the entry of certain softwood

lumber products from Canada and will

be used by the U.S. Customs Service to

administer, and monitor compliance

with, the Softwood Lumber Agreement

with Canada. The likely respondents are

business organizations including

importers, exporters and manufacturers.

Estimated total annual reporting and/

or recordkeeping burden: 3,000 hours.

Estimated average annual burden per

respondent/recordkeeper: 20 hours.

Estimated number of respondents

and/or recordkeepers: 150.

Estimated annual number of

responses: 350,000.

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 burden of the

collection of information; (c) ways to

enhance the quality, utility, and clarity

of the information to be collected; and

(d) ways to minimize the burden of the

collection of information on

respondents, including through the use

of automated collection techniques or

other forms of information technology.

Comments should be directed 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 the Regulations Branch,

Office of Regulations and Rulings, U.S.

Customs Service, 1301 Constitution

Avenue, N.W., Washington, D.C. 20229.

List of Subjects

19 CFR Part 12

Bonds, Canada, Customs duties and

inspection, Entry of merchandise,

Imports, Prohibited merchandise,

Reporting and recordkeeping

requirements, Restricted merchandise,

Trade agreements.

19 CFR Part 113

Air carriers, Bonds, Customs duties

and inspection, Exports, Foreign

commerce and trade statistics, Freight,

Imports, Reporting and recordkeeping

requirements, Vessels.

Amendments to the Regulations

Accordingly, Parts 12 and 113,

Customs Regulations (19 CFR Parts 12

and 113), are amended as set forth

below.

PART 12—SPECIAL CLASSES OF

MERCHANDISE

1. The general authority citation for

Part 12 continues to read, and a specific

authority citation for § 12.140 is added

to read, as follows:

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

(General Note 20, Harmonized Tariff

Schedule of the United States (HTSUS)),

1624.

* * * * *

Section 12.140 also issued under 19

U.S.C. 1484, 2416(a), 2171.

2. A new center heading and new

§ 12.140 are added to read as follows:

Softwood Lumber From Canada

§ 12.140 Entry of softwood lumber from

Canada.

The requirements set forth in this

section are applicable for as long as the

Softwood Lumber Agreement, entered

into on May 29, 1996, by the

Governments of the United States and

Canada, remains in effect.

(a) Encumbrance regarding export

permit and export fee. In the case of

softwood lumber first manufactured into

a product classifiable in subheading

4407.10.00, 4409.10.10, 4409.10.20, or

4409.10.90, Harmonized Tariff Schedule

of the United States (HTSUS), in the

Province of Ontario, Quebec, British

Columbia, or Alberta, the requirement

that the Government of Canada issue an

export permit and collect the

appropriate export fees under the

Softwood Lumber Agreement attaches to

and encumbers the product when it is

imported into the United States. Such

imported merchandise remains subject

to the encumbrance until the

Government of Canada issues an export

permit and collects the appropriate fees.

The merchandise shall be released by

Customs subject to the following

conditions: The importer of record

assumes an obligation to ensure within

20 working days of release that such

export permit is issued by the

Government of Canada and to provide

sufficient information to satisfy U.S.

Customs that the encumbrance no

longer attaches or, if the merchandise

remains encumbered at the expiration of

20 working days, to pay any liquidated

damages assessed under the Customs

bond.

(b) Reporting requirements. Except as

otherwise provided in paragraph (d) of

this section, in the case of a softwood

lumber product classifiable in HTSUS

subheading 4407.10.00, 4409.10.10,

4409.10.20, or 4409.10.90 that is

imported from Canada and that was

manufactured (that is, subjected to any

processing operation other than mere

loading, unloading or processing

necessary to maintain the condition of

the product) in Canada, whether or not

such product was previously subjected

to any processing operation outside

Canada, the following information shall

be included on the entry summary,

Customs Form 7501, or on an electronic

equivalent:

(1) The Canadian province or territory

in which the product was first

manufactured; and
Federal Register / Vol. 62, No. 38 / Wednesday, February 26, 1997 / Rules and Regulations 8623

(2) In the case of a product first

manufactured into a product classifiable

in HTSUS subheading 4407.10.00,

4409.10.10, 4409.10.20, or 4409.10.90 in

the Province of Ontario, Quebec, British

Columbia, or Alberta:

(i) The export permit number issued

by the Government of Canada for the

product; and

(ii) An indication of the export fee

payment status of the product for which

the permit was issued according to the

following categories:

(A) Category A: No payment of an

export fee because the exported product

falls within the base amount of 14.7

billion board feet. This category

includes products for which the export

permit was issued without an indication

of the export fee status;

(B) Category B: Payment of the export

fee applicable to a product exported in

excess of 14.7 billion board feet but not

in excess of 15.35 billion board feet;

(C) Category C: Payment of the export

fee applicable to a product exported in

excess of 15.35 billion board feet; or

(D) Category D: No payment of an

export fee where the product was

exported in excess of 14.7 billion board

feet because the average price of a

benchmark softwood lumber price

exceeds a prescribed trigger price during

any quarterly period as determined by

the Governments of Canada and the

United States. If the issued permit

pertains to this category, the specific

quarterly period shall also be indicated

on the Customs Form 7501 or electronic

equivalent.

(c) Untimely issuance of export

permit. If an export permit for the

product has not been issued by the

Government of Canada on or before the

required date for filing the entry

summary documentation as provided in

§ 142.12(b) or § 142.23 of this chapter,

the importer shall have a maximum of

10 additional working days to file the

entry summary documentation setting

forth all of the information specified in

paragraph (b)(2) of this section. If an

export permit for the product has not

been issued by the Government of

Canada within the maximum time

period specified in this paragraph, the

entry summary or electronic equivalent

shall be filed on the next business day

and shall be completed in pertinent part

as follows:

(1) The export permit number field

shall be completed by inserting as many

eights as are necessary to complete the

field; and

(2) The export fee payment status

field shall be completed by inserting an

‘‘A’’ followed by two zeros.

(d) Absence of export permit number

and fee status data for certain

remanufactured softwood lumber

products. In the case of a softwood

lumber mill product classifiable in

HTSUS subheading 4407.10.00,

4409.10.10, 4409.10.20, or 4409.10.90

that is imported from Canada and that

was first manufactured in Canada in the

Province of Ontario, Quebec, British

Columbia, or Alberta, if no export

permit for the product is issued by the

Government of Canada because the

product was previously subjected to

processing operations outside Canada,

the entry summary, Customs Form 7501,

or an electronic equivalent, shall

include the Canadian province or

territory in which the product was first

manufactured and also shall be

completed in pertinent part as follows:

(1) The export permit number field

shall be completed by inserting as many

nines as are necessary to complete the

field; and

(2) The export fee payment status

field shall be completed by inserting an

‘‘A’’ followed by two zeros.

PART 113—CUSTOMS BONDS

1. The authority citation for Part 113

continues to read in part as follows:

Authority: 19 U.S.C. 66, 1623, 1624.

* * * * *

2. Section 113.62 is amended:

a. By redesignating paragraph (k) as

paragraph (l);

b. In the penultimate sentence of

paragraph (l)(4) of redesignated

paragraph (l), by removing the reference

‘‘paragraph (k)(1)’’ and adding, in its

place, the reference ‘‘paragraph (l)(1)’’;

and

c. By adding a new paragraph (k) and

adding a new paragraph (l)(5) at the end

of newly designated paragraph (l) to

read as follows:

§ 113.62 Basic importation and entry bond

conditions.

* * * * *

(k) Agreement to ensure and establish

issuance of softwood lumber export

permit and collection of export fees. In

the case of a softwood lumber product

imported from Canada that is subject to

the requirement that the Government of

Canada issue an export permit pursuant

to the Softwood Lumber Agreement, the

principal agrees, as set forth in

§ 12.140(a) of this chapter, to assume the

obligation to ensure within 20 working

days of release of the merchandise, and

establish to the satisfaction of Customs,

that the applicable export permit has

been issued by the Government of

Canada.

(l) * * *

(5) If the principal defaults on

agreements in the condition set forth in

paragraph (k) of this section only, the

obligors agree to pay liquidated damages

equal to $100 per thousand board feet of

the imported lumber.

Approved: February 20, 1997.

George J. Weise,

Commissioner of Customs.

John P. Simpson,

Deputy Assistant Secretary of the Treasury.

[FR Doc. 97–4682 Filed 2–25–97; 8:45 am]

BILLING CODE 4820–02–P

ENVIRONMENTAL PROTECTION

AGENCY

40 CFR Part 52

[PA 083–4036a, PA 083–4037a, PA 069–

4035a; FRL–5690–4]

Approval and Promulgation of Air

Quality Implementation Plans;

Pennsylvania Source-Specific VOC

and NOX RACT Determinations, and

1990 Base Year Emissions for One

Source; Correction

AGENCY: Environmental Protection

Agency (EPA).

ACTION: Direct final rule; correction.

SUMMARY: This action corrects the

citation of a direct final rule, which was

published on Friday, December 20, 1996

(61 FR 67229). This action pertains to

the Pennsylvania source-specific RACT

determinations for three sources: Caparo

Steel Company, Sharon Steel Company,

and Pennsylvania Electric Company—

Williamsburg Station.

EFFECTIVE DATE: February 26, 1997.

FOR FURTHER INFORMATION CONTACT:

Janice Lewis, (215) 566–2185, or

Carolyn Donahue, (215) 566–2095.

SUPPLEMENTARY INFORMATION:

Background

On December 20, 1996 (61 FR 67229)

EPA published a direct final rule

approving a SIP revision submitted by

Pennsylvania pertaining to

Pennsylvania source-specific RACT

determinations for Caparo Steel, Sharon

Steel, and Penelec—Williamsburg, and

1990 Base year emissions for Sharon

Steel Company.

Need for Correction

As published, the direct final rule

contains an error which may prove to be

misleading and is in need of

clarification. The error is typographical

in nature; the state submittal from the

Pennsylvania Department of

Environmental Protection (PADEP)

correctly cites the emission limit for

Penelec—Williamsburg.