Federal Register / Vol. 80, No. 27 / Tuesday, February 10, 2015 / Rules and Regulations 7303 

TABLE I—Continued 

Year 

Limit 

Auto. proj. 

cost limit 

(Col. 1) 

Prior notice proj. 

cost limit 

(Col. 2) 

1989 ............................................................................................................................................................. 5,600,000 15,600,000 

1990 ............................................................................................................................................................. 5,800,000 16,000,000 

1991 ............................................................................................................................................................. 6,000,000 16,700,000 

1992 ............................................................................................................................................................. 6,200,000 17,300,000 

1993 ............................................................................................................................................................. 6,400,000 17,700,000 

1994 ............................................................................................................................................................. 6,600,000 18,100,000 

1995 ............................................................................................................................................................. 6,700,000 18,400,000 

1996 ............................................................................................................................................................. 6,900,000 18,800,000 

1997 ............................................................................................................................................................. 7,000,000 19,200,000 

1998 ............................................................................................................................................................. 7,100,000 19,600,000 

1999 ............................................................................................................................................................. 7,200,000 19,800,000 

2000 ............................................................................................................................................................. 7,300,000 20,200,000 

2001 ............................................................................................................................................................. 7,400,000 20,600,000 

2002 ............................................................................................................................................................. 7,500,000 21,000,000 

2003 ............................................................................................................................................................. 7,600,000 21,200,000 

2004 ............................................................................................................................................................. 7,800,000 21,600,000 

2005 ............................................................................................................................................................. 8,000,000 22,000,000 

2006 ............................................................................................................................................................. 9,600,000 27,400,000 

2007 ............................................................................................................................................................. 9,900,000 28,200,000 

2008 ............................................................................................................................................................. 10,200,000 29,000,000 

2009 ............................................................................................................................................................. 10,400,000 29,600,000 

2010 ............................................................................................................................................................. 10,500,000 29,900,000 

2011 ............................................................................................................................................................. 10,600,000 30,200,000 

2012 ............................................................................................................................................................. 10,800,000 30,800,000 

2013 ............................................................................................................................................................. 11,000,000 31,400,000 

2014 ............................................................................................................................................................. 11,200,000 31,900,000 

2015 ............................................................................................................................................................. 11,400,000 32,400,000 

* * * * * 

■ 3. Table II in § 157.215(a)(5) is revised 

to read as follows: 

§ 157.215 Underground storage testing 

and development. 

(a) * * * 

(5) * * * 

TABLE II 

Year Limit 

1982 ................................ $2,700,000 

1983 ................................ 2,900,000 

1984 ................................ 3,000,000 

1985 ................................ 3,100,000 

1986 ................................ 3,200,000 

1987 ................................ 3,300,000 

1988 ................................ 3,400,000 

1989 ................................ 3,500,000 

1990 ................................ 3,600,000 

1991 ................................ 3,800,000 

1992 ................................ 3,900,000 

1993 ................................ 4,000,000 

1994 ................................ 4,100,000 

1995 ................................ 4,200,000 

1996 ................................ 4,300,000 

1997 ................................ 4,400,000 

1998 ................................ 4,500,000 

1999 ................................ 4,550,000 

2000 ................................ 4,650,000 

2001 ................................ 4,750,000 

2002 ................................ 4,850,000 

2003 ................................ 4,900,000 

2004 ................................ 5,000,000 

2005 ................................ 5,100,000 

2006 ................................ 5,250,000 

TABLE II—Continued 

Year Limit 

2007 ................................ 5,400,000 

2008 ................................ 5,550,000 

2009 ................................ 5,600,000 

2010 ................................ 5,700,000 

2011 ................................ 5,750,000 

2012 ................................ 5,850,000 

2013 ................................ 6,000,000 

2014 ................................ 6,100,000 

2015 ................................ 6,200,000 

* * * * * 

[FR Doc. 2015–02653 Filed 2–9–15; 8:45 am] 

BILLING CODE 6717–01–P 

DEPARTMENT OF HOMELAND 

SECURITY 

Customs and Border Protection 

DEPARTMENT OF THE TREASURY 

19 CFR Parts 10, 24, 162, 163, and 178] 

[USCBP–2015–0007: CBP Dec. 15–03 

RIN 1515–AD59 

United States-Australia Free Trade 

Agreement 

AGENCIES: U.S. Customs and Border 

Protection, Department of Homeland 

Security; Department of the Treasury. 

ACTION: Interim regulations; solicitation 

of comments. 

SUMMARY: This rule amends the U.S. 

Customs and Border Protection 

regulations on an interim basis to 

implement the preferential tariff 

treatment and other customs-related 

provisions of the United StatesAustralia Free Trade Agreement entered 

into by the United States and the 

Commonwealth of Australia. 

DATES: Interim rule effective February 

10, 2015; comments must be received by 

April 13, 2015. 


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7304 Federal Register / Vol. 80, No. 27 / Tuesday, February 10, 2015 / Rules and Regulations 

ADDRESSES: You may submit comments, 

identified by docket number, by one of 

the following methods: 

• Federal eRulemaking Portal: http:// 

www.regulations.gov. Follow the 

instructions for submitting comments 

via docket number USCBP–2015–0007. 

• Mail: Trade and Commercial 

Regulations Branch, Regulations and 

Rulings, Office of International Trade, 

U.S. Customs and Border Protection, 90 

K Street NE., 10th Floor, Washington, 

DC 20229–1177. 

Instructions: All submissions received 

must include the agency name and 

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 Trade and 

Commercial Regulations Branch, 

Regulations and Rulings, Office of 

International Trade, U.S. Customs and 

Border Protection, 90 K Street NE., 10th 

Floor, Washington, DC. Arrangements to 

inspect submitted comments should be 

made in advance by calling Mr. Joseph 

Clark at (202) 325–0118. 

FOR FURTHER INFORMATION CONTACT: 

Textile Operational Aspects: Diane 

Liberta, Textile Operations Branch, 

Office of International Trade, (202) 863– 

6241. 

Other Operational Aspects: Katrina 

Chang, Trade Policy and Programs, 

Office of International Trade, (202) 863– 

6532. 

Legal Aspects: Yuliya Gulis, 

Regulations and Rulings, Office of 

International Trade, (202) 325–0042. 

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. U.S. 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 

regulations will reference a specific 

portion of the interim rule, explain the 

reason for any recommended change, 

and include data, information, or 

authority that support such 

recommended change. See ADDRESSES

above for information on how to submit 

comments. 

Background 

On May 18, 2004, the United States 

and Australia (the ‘‘Parties’’) signed the 

U.S.-Australia Free Trade Agreement 

(‘‘AFTA’’ or ‘‘Agreement’’). On August 

3, 2004, the President signed into law 

the United States-Australia Free Trade 

Agreement Implementation Act (the 

‘‘Act’’), Pub. L. 108–286, 118 Stat. 919 

(19 U.S.C. 3805 note), which approved 

and made statutory changes to 

implement the AFTA. Section 207 of the 

Act requires that regulations be 

prescribed as necessary to implement 

the provisions of the AFTA. 

On December 20, 2004, the President 

signed Proclamation 7857 

(‘‘Proclamation’’) to implement the 

AFTA. The Proclamation, which was 

published in the Federal Register on 

December 23, 2004 (69 FR 77133), 

modified the Harmonized Tariff 

Schedule of the United States 

(‘‘HTSUS’’) as set forth in Annexes I and 

II of Publication 3722 of the U.S. 

International Trade Commission. The 

modifications to the HTSUS included 

the addition of new General Note 28, 

incorporating the relevant AFTA rules 

of origin as set forth in the Act, and the 

insertion throughout the HTSUS of the 

preferential duty rates applicable to 

individual products under the AFTA 

where the special program indicator 

‘‘AU’’ appears in parenthesis in the 

‘‘Special’’ rate of duty subcolumn. The 

modifications to the HTSUS also 

included a new Subchapter XIII to 

Chapter 99 to provide for temporary 

tariff-rate quotas and applicable 

safeguards implemented by the AFTA, 

as well as modifications to Subchapter 

XXII of Chapter 98. After the 

Proclamation was signed, CBP issued 

instructions to the field and the public 

implementing the Agreement by 

allowing the trade to receive the benefits 

under the AFTA effective on or after 

January 1, 2005. 

CBP is responsible for administering 

the provisions of the AFTA and the Act 

that relate to the importation of goods 

into the United States from Australia. 

Those customs-related AFTA provisions 

which require implementation through 

regulation include certain tariff and 

non-tariff provisions within Chapter 

One (Establishment of a Free Trade Area 

and Definitions), Chapter Two (National 

Treatment and Market Access for 

Goods), Chapter Four (Textiles and 

Apparel), Chapter Five (Rules of Origin), 

and Chapter Six (Customs 

Administration). 

Certain general definitions set forth in 

Chapter One of the AFTA have been 

incorporated into the AFTA 

implementing regulations. These 

regulations also implement Article 1.2 

(General Definitions) and Annex 1–A 

(Certain Definitions) of the AFTA. The 

tariff-related provisions within AFTA 

Chapter Two that require regulatory 

action by CBP are Article 2.6 (Goods reentered after Repair or Alteration) and 

Article 2.12 (Merchandise Processing 

Fee). 

Chapter Four of the AFTA sets forth 

provisions relating to trade in textile 

and apparel goods between Australia 

and the United States under the AFTA. 

Section A of Chapter Five of the AFTA 

sets forth the rules for determining 

whether an imported good is an 

originating good of the United States or 

Australia and, as such, is therefore 

eligible for preferential tariff (duty-free 

or reduced duty) treatment under the 

AFTA as specified in the Agreement 

and the HTSUS. 

Under AFTA Article 5.1 of Chapter 

Five (Originating Goods) and section 

203(b) of the Act, originating goods may 

be grouped in four broad categories: (1) 

Goods that are wholly obtained or 

produced entirely in one or both of the 

Parties; (2) goods that are produced 

entirely in one or both of the Parties and 

that satisfy the product-specific rules of 

origin in AFTA Annex 4–A (Textile or 

Apparel Specific Rules of Origin) or 

Annex 5–A (Specific Rules of Origin); 

(3) goods that are produced entirely in 

the territory of one or both of the Parties 

exclusively from originating materials; 

and (4) goods that otherwise qualify as 

originating goods under Chapter 4 or 5 

of the AFTA. AFTA Article 5.2 (section 

203(c) of the Act) provides a de minimis 

criterion. AFTA Article 5.3 (section 

203(d) of the Act) allows production 

that takes place in the territory of both 

Parties to be accumulated such that, 

provided other requirements are met, 

the resulting good is considered 

originating. AFTA Article 5.4 (section 

203(e) of the Act) sets forth the methods 

for calculating the regional value 

content of a good. AFTA Article 5.5 

(section 203(f) of the Act) sets forth the 

rules for determining the value of 

materials for purposes of calculating the 

regional value content of a good and 

applying the de minimis criterion. The 

remaining Articles within Section A of 

Chapter Five consist of additional subrules, applicable to the originating good 

concept, involving: Accessories, Spare 

Parts and Tools (Article 5.6; section 

203(g) of the Act); Fungible Goods and 


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Federal Register / Vol. 80, No. 27 / Tuesday, February 10, 2015 / Rules and Regulations 7305 

Materials (Article 5.7; section 203(h) of 

the Act); Packaging Materials and 

Containers for Retail Sale (Article 5.8; 

section 203(i) of the Act); Packing 

Materials and Containers for Shipment 

(Article 5.9; section 203(j) of the Act); 

Indirect Materials (Article 5.10; section 

203(k) of the Act); and Third Country 

Transportation (Article 5.11; section 

203(l) of the Act (Third Country 

Operations)). The basic rules of origin in 

Chapter Five of the AFTA are set forth 

in General Note 28, HTSUS, and 

reflected in the AFTA implementing 

regulations. 

Section B of Chapter Five sets forth 

procedures that apply under the AFTA 

in regard to claims for preferential tariff 

treatment. Section C sets forth 

consultation mechanisms between the 

Parties. Section D discusses the use of 

the Harmonized System and generally 

accepted accounting principles in 

determining whether a good is 

originating under the AFTA. Finally, 

Section E lists the definitions to be used 

within the context of the rules of origin 

in the Chapter. 

Chapter Six of the AFTA sets forth 

operational provisions related to 

customs administration under the 

AFTA. 

The majority of the AFTA 

implementing regulations set forth in 

this document have been included 

within new Subpart L in Part 10 of the 

CBP regulations (19 CFR part 10). 

However, in those cases in which AFTA 

implementation is more appropriate in 

the context of an existing regulatory 

provision, the AFTA regulatory text has 

been incorporated in an existing Part 

within the CBP regulations. In addition, 

this document sets forth several crossreferences and other consequential 

changes to existing regulatory 

provisions to clarify the relationship 

between those existing provisions and 

the new AFTA implementing 

regulations. The regulatory changes are 

discussed below in the order in which 

they appear in this document. 

Discussion of Amendments 

Part 10 

Section 10.31(f) concerns temporary 

importations under bond. It is amended 

by adding references to certain goods 

originating in Australia for which, like 

goods originating in Canada, Mexico, 

Singapore, Chile, Morocco, El Salvador, 

Guatemala, Honduras, Nicaragua, the 

Dominican Republic, Costa Rica, 

Bahrain, Oman, Peru, the Republic of 

Korea, or Colombia, no bond or other 

security will be required when imported 

temporarily for prescribed uses. The 

provisions of AFTA Article 2.5 

(Temporary Admission of Goods) are 

already reflected in existing temporary 

importation bond or other provisions 

contained in Part 10 of the CBP 

regulations and in Chapter 98 of the 

HTSUS. 

Part 10, Subpart L 

General Provisions 

Section 10.721 outlines the scope of 

new Subpart L, Part 10 of the CBP 

regulations. This section also clarifies 

that, except where the context otherwise 

requires, the requirements contained in 

Subpart L, Part 10 are in addition to 

general administrative and enforcement 

provisions set forth elsewhere in the 

CBP regulations. Thus, for example, the 

specific merchandise entry 

requirements contained in Subpart L, 

Part 10 are in addition to the basic entry 

requirements contained in Parts 141– 

143 of the CBP regulations. 

Section 10.722 sets forth definitions 

of common terms used within Subpart 

L, Part 10. Although the majority of the 

definitions in this section are based on 

definitions contained in Article 1.2 and 

Annex 1–A of the AFTA, and section 3 

of the Act, other definitions have also 

been included to clarify the application 

of the regulatory texts. Additional 

definitions that apply in a more limited 

Subpart L, Part 10 context are set forth 

elsewhere with the substantive 

provisions to which they relate. 

Import Requirements 

Section 10.723 sets forth the 

procedure for claiming AFTA 

preferential tariff treatment at the time 

of entry and, as provided in AFTA 

Article 5.12, states that an importer may 

make a claim for AFTA preferential 

treatment based on the importer’s 

knowledge or on information in the 

importer’s possession that the good 

qualifies as an originating good. Section 

10.723 also provides, consistent with 

AFTA Article 5.13, that an importer 

must promptly and voluntarily correct 

an invalid claim for preferential tariff 

treatment in order to avoid being subject 

to penalties. 

Section 10.724, which is based on 

AFTA Article 5.12, requires a U.S. 

importer, upon request, to submit a 

supporting statement setting forth the 

reasons that the good qualifies as an 

AFTA originating good in connection 

with the claim. Included in § 10.724 is 

a provision that the supporting 

statement may be used either for a 

single importation or for multiple 

importations of identical goods. 

Section 10.725 sets forth certain 

importer obligations regarding the 

truthfulness of information and 

documents submitted in support of a 

claim for preferential tariff treatment. 

Section 10.726 provides that the 

importer’s supporting statement is not 

required for certain non-commercial or 

low-value importations. 

Section 10.727 implements AFTA 

Article 5.14 concerning the maintenance 

of relevant records regarding the 

imported good. 

Section 10.728, which is based on 

AFTA Article 5.13, authorizes the 

denial of AFTA tariff benefits if the 

importer fails to comply with any of the 

requirements under Subpart L, Part 10, 

CBP regulations. 

Rules of Origin 

Sections 10.729 through 10.741 

provide the implementing regulations 

regarding the rules of origin provisions 

of General Note 28, HTSUS, Chapters 

Four and Five of AFTA, and section 203 

of the Act. 

Definitions 

Section 10.729 sets forth terms that 

are defined for purposes of the rules of 

origin as found in section 203(n) of the 

Act and other definitions that have been 

included to clarify the application of the 

regulatory texts. 

General Rules of Origin 

Section 10.730 sets forth the basic 

rules of origin established in Article 5.1 

of the AFTA, section 203(b) of the Act, 

and General Note 28(b), HTSUS. The 

provisions of § 10.730 apply both to the 

determination of the status of an 

imported good as an originating good for 

purposes of preferential tariff treatment 

and to the determination of the status of 

a material as an originating material 

used in a good which is subject to a 

determination under General Note 28, 

HTSUS. 

Section 10.730(a), reflecting section 

203(b)(1) of the Act, specifies those 

goods that are originating goods because 

they are wholly obtained or produced 

entirely in the territory of one or both 

of the Parties. 

Section 10.730(b), reflecting section 

203(b)(2) of the Act, provides that goods 

that have been produced entirely in the 

territory of one or both of the Parties so 

that each non-originating material 

undergoes an applicable change in tariff 

classification and satisfies any 

applicable regional value content or 

other requirement set forth in General 

Note 28(n) are originating goods. 

Essential to the rules in § 10.730(b) are 

the specific rules of General Note 28(n), 

HTSUS, which are incorporated by 

reference. 

Section 10.730(c), reflecting section 

203(b)(3) of the Act, provides that goods 


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7306 Federal Register / Vol. 80, No. 27 / Tuesday, February 10, 2015 / Rules and Regulations 

that have been produced entirely in the 

territory of one or both of the Parties 

exclusively from originating materials 

are originating goods. Under § 10.730(d), 

which implements section 203(b)(4) of 

the Act, goods are considered 

originating goods if they otherwise 

qualify as originating goods under 

General Note 28, HTSUS. 

Textile and Apparel Goods Classifiable 

as Goods Put Up in Sets 

Section 10.731, which is based on 

AFTA Article 4.2.8, provides that, 

notwithstanding the specific rules of 

General Note 28(n), HTSUS, textile and 

apparel goods classifiable as goods put 

up in sets for retail sale as provided for 

in General Rule of Interpretation 3, 

HTSUS, will not qualify as originating 

goods unless each of the goods in the set 

is an originating good or the total value 

of the non-originating goods in the set 

does not exceed 10 percent of the value 

of the set. 

De Minimis 

Section 10.732, as provided for in 

AFTA Article 5.2 and section 203(c) of 

the Act, sets forth de minimis rules for 

goods that may be considered to qualify 

as originating goods even though they 

fail to qualify as originating goods under 

the rules in § 10.730. There are a 

number of exceptions to the de minimis 

rule set forth in the AFTA Annex 5–A 

(exceptions to Article 5.2) as well as a 

separate rule for textile and apparel 

goods. 

Accumulation 

Section 10.733, which is derived from 

AFTA Article 5.3 and section 203(d) of 

the Act, sets forth the rule by which 

originating materials from the territory 

of Australia or the United States that are 

used in the production of a good in the 

territory of the other country will be 

considered to originate in the territory 

of such other country. In addition, this 

section also establishes that a good that 

is produced by one or more producers 

in the territory of Australia or the 

United States, or both, is an originating 

good if the good satisfies all of the 

applicable requirements of the rules of 

origin of the AFTA. 

Value Content 

Section 10.734 reflects AFTA Article 

5.4 and section 203(e) of the Act 

concerning the basic rules that apply for 

purposes of determining whether an 

imported good satisfies a minimum 

regional value content (‘‘RVC’’) 

requirement. Section 10.735, reflecting 

AFTA Article 5.5 and section 203(f) of 

the Act, sets forth the rules for 

determining the value of a material for 

purposes of calculating the regional 

value content of a good as well as for 

purposes of applying the de minimis 

rules. 

Accessories, Spare Parts, or Tools 

Section 10.736, as set forth in AFTA 

Article 5.6 and section 203(g) of the Act, 

specifies the conditions under which a 

good’s standard accessories, spare parts, 

or tools are: (1) Treated as originating 

goods; and (2) disregarded in 

determining whether all non-originating 

materials undergo an applicable change 

in tariff classification under General 

Note 28(n), HTSUS. 

Fungible Goods and Materials 

Section 10.737, as provided for in 

AFTA Article 5.7 and section 203(h) of 

the Act, sets forth the rules by which 

‘‘fungible’’ goods or materials may be 

claimed as originating. 

Packaging Materials and Packing 

Materials 

Sections 10.738 and 10.739, which are 

derived from AFTA Articles 5.8 and 5.9 

and sections 203(i) and (j) of the Act, 

respectively, provide that retail 

packaging materials and packing 

materials for shipment are to be 

disregarded with respect to their actual 

origin in determining whether nonoriginating materials undergo an 

applicable change in tariff classification 

under General Note 28(n), HTSUS. 

These sections also set forth the 

treatment of packaging and packing 

materials for purposes of the regional 

value content requirement of the note. 

Indirect Materials 

Section 10.740, as set forth in AFTA 

Article 5.10 and section 203(k) of the 

Act, provides that indirect materials, as 

defined in § 10.729(h), are considered to 

be originating materials without regard 

to where they are produced. 

Third Country Transportation 

Section 10.741, which is derived from 

AFTA Article 5.11 and section 203(l) of 

the Act, sets forth the rule that an 

originating good loses its originating 

status and is treated as a non-originating 

good if, subsequent to production in the 

territory of one or both of the Parties 

that qualifies the good as originating, 

the good undergoes production outside 

the territories of the Parties. 

Origin Verifications and Determinations 

Section 10.742 implements AFTA 

Article 5.15 which concerns the conduct 

of verifications to determine whether 

imported goods are originating goods 

entitled to AFTA preferential tariff 

treatment and the application of origin 

determinations resulting from such 

verifications. This section also governs 

the conduct of verifications directed to 

producers of materials that are used in 

the production of a good for which 

AFTA preferential duty treatment is 

claimed. 

Section 10.743, as provided for in 

AFTA Article 4.3 and section 206 of the 

Act, sets forth the verification and 

enforcement procedures specifically 

relating to trade in textile and apparel 

goods. 

Section 10.744 also implements 

AFTA Articles 4.3 and 5.15 and sections 

205 and 206 of the Act, and provides the 

procedures that apply when preferential 

tariff treatment is denied on the basis of 

an origin verification conducted under 

Subpart L, Part 10 of the CBP 

regulations. 

Penalties 

Section 10.745 concerns the general 

application of penalties to AFTA 

transactions and is based on AFTA 

Article 6.7 and section 205 of the Act. 

Section 10.746 implements AFTA 

Article 5.13.4 with regard to exceptions 

to the application of penalties in the 

case of an importer who promptly and 

voluntarily makes a corrected claim or 

supporting statement and pays any 

duties owing. The AFTA’s exception to 

the application of penalties is 

contingent upon the importer correcting 

the claim and paying any duties owing 

within a period, determined by each 

importing Party, which may not be less 

than one year from submission of the 

invalid claim. 

Section 10.747 also reflects AFTA 

Article 5.13.4 and section 205 of the 

Act, and sets forth the circumstances 

under which the making of a corrected 

claim or supporting statement by an 

importer will be considered to have 

been done ‘‘promptly and voluntarily.’’ 

Corrected claims or certifications that 

fail to meet these requirements are not 

excepted from penalties, although the 

importer making the corrected claim or 

supporting statement may, depending 

on the circumstances, qualify for a 

reduced penalty as a prior disclosure 

under 19 U.S.C. 1592(c)(4). Section 

10.747(c) also specifies the content of 

the statement that must accompany each 

corrected claim. 

Goods Returned After Repair or 

Alteration 

Section 10.748 implements AFTA 

Article 2.6 regarding duty-free treatment 

for goods re-entered after repair or 

alteration in Australia. 


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Federal Register / Vol. 80, No. 27 / Tuesday, February 10, 2015 / Rules and Regulations 7307 

Part 24 

An amendment is made to § 24.23(c) 

(19 CFR 24.23(c)), which concerns the 

merchandise processing fee, to 

implement AFTA Article 2.12 and 

section 204 of the Act, to provide that 

the merchandise processing fee is not 

applicable to goods that qualify as 

originating goods under the AFTA. 

Part 162 

Part 162 contains regulations 

regarding the inspection and 

examination of, among other things, 

imported merchandise. A crossreference is added to § 162.0 (19 CFR 

162.0), which is the scope section of the 

part, to refer readers to the additional 

AFTA records maintenance and 

examination provisions contained in 

new Subpart L, Part 10, CBP regulations. 

Part 163 

A conforming amendment is made to 

§ 163.1 (19 CFR 163.1) to include, as 

authorized by AFTA Article 5.14, the 

requirement that the importer maintain 

records and documents necessary to 

support a claim for preferential tariff 

treatment under the AFTA. Also, the list 

of records and information required for 

the entry of merchandise appearing in 

the Appendix to Part 163 (commonly 

known as the (a)(1)(A) list) is also 

amended to add the records and 

documents necessary to support an 

AFTA claim for preferential tariff 

treatment. 

Part 178 

Part 178 sets forth the control 

numbers assigned to information 

collections of CBP by the Office of 

Management and Budget (OMB), 

pursuant to the Paperwork Reduction 

Act of 1995, Public Law 104–13. The list 

contained in § 178.2 (19 CFR 178.2) is 

amended to add the information 

collections used by CBP to determine 

eligibility for a tariff preference or other 

rights or benefits under the AFTA and 

the Act. 

Inapplicability of Notice and Delayed 

Effective Date Requirements 

Under the Administrative Procedure 

Act (APA) (5 U.S.C. 553), agencies 

generally are required to publish a 

notice of proposed rulemaking in the 

Federal Register that solicits public 

comment on the proposed regulatory 

amendments, consider public comments 

in deciding on the content of the final 

amendments, and publish the final 

amendments at least 30 days prior to 

their effective date. However, section 

553(a)(1) of the APA provides that the 

standard prior notice and comment 

procedures do not apply to an agency 

rulemaking to the extent that it involves 

a foreign affairs function of the United 

States. CBP has determined that these 

interim regulations involve a foreign 

affairs function of the United States 

because they implement preferential 

tariff treatment and related provisions of 

the AFTA. Therefore, the rulemaking 

requirements under the APA do not 

apply and this interim rule will be 

effective upon publication. However, 

CBP is soliciting comments in this 

interim rule and will consider all 

comments received before issuing a 

final rule. 

Executive Order 12866 and the 

Regulatory Flexibility Act 

Executive Order 12866 directs 

agencies to assess costs and benefits of 

available regulatory alternatives and, if 

regulation is necessary, to select 

regulatory approaches that maximize 

net benefits (including potential 

economic, environmental, public health 

and safety effects, distributive impacts, 

and equity). It has been determined that 

this rule is not a significant regulatory 

action, as defined in section 3(f) of 

Executive Order 12866. Because a notice 

of proposed rulemaking is not required 

under section 553(b) of the APA for the 

reasons described above, the provisions 

of the Regulatory Flexibility Act, as 

amended (5 U.S.C. 601 et seq.), do not 

apply to this rulemaking. Accordingly, 

this interim rule is not subject to the 

regulatory analysis requirements or 

other requirements of 5 U.S.C. 603 and 

604. 

Paperwork Reduction Act 

The collections of information 

contained in these regulations have 

previously been reviewed and approved 

by OMB in accordance with the 

requirements of the Paperwork 

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

control number 1651–0117, which 

covers many of the free trade agreement 

requirements that CBP administers. The 

addition of the AFTA requirements will 

result in an increase in the number of 

respondents and burden hours for this 

information collection. Under the 

Paperwork Reduction Act, an agency 

may not conduct or sponsor, and an 

individual is not required to respond to, 

a collection of information unless it 

displays a valid OMB control number. 

The collections of information in 

these regulations are in §§ 10.723, 

10.724, and 10.727. This information is 

required in connection with general 

recordkeeping requirements (§ 10.727), 

as well as claims for preferential tariff 

treatment under the AFTA and the Act 

and will be used by CBP to determine 

eligibility for tariff preference under the 

AFTA and the Act (§§ 10.723 and 

10.724). The likely respondents are 

business organizations including 

importers, exporters and manufacturers. 

The burdens imposed by these 

regulations are: 

Estimated total annual reporting 

burden: 4,000 hours. 

Estimated number of respondents: 

20,000. 

Estimated annual frequency of 

responses per respondent: 1. 

Estimated average annual burden per 

response: .2 hours. 

Comments concerning the collections 

of information and the accuracy of the 

estimated annual burden, and 

suggestions for reducing that burden, 

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, DC 

20503. A copy should also be sent to the 

Trade and Commercial Regulations 

Branch, Regulations and Rulings, Office 

of International Trade, U.S. Customs 

and Border Protection, 90 K Street NE., 

10th Floor, Washington, DC 20229– 

1177. 

Signing Authority 

This document is being issued in 

accordance with § 0.1(a)(1) of the CBP 

regulations (19 CFR 0.1(a)(1)) pertaining 

to the authority of the Secretary of the 

Treasury (or his/her delegate) to 

approve regulations related to certain 

customs revenue functions. 

List of Subjects 

19 CFR Part 10 

Alterations, Bonds, Customs duties 

and inspection, Exports, Imports, 

Preference programs, Repairs, Reporting 

and recordkeeping requirements, Trade 

agreements. 

19 CFR Part 24 

Accounting, Customs duties and 

inspection, Financial and accounting 

procedures, Reporting and 

recordkeeping requirements, Trade 

agreements, User fees. 

19 CFR Part 162 

Administrative practice and 

procedure, Customs duties and 

inspection, Penalties, Trade agreements. 

19 CFR Part 163 

Administrative practice and 

procedure, Customs duties and 

inspection, Exports, Imports, Reporting 

and recordkeeping requirements, Trade 

agreements. 


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7308 Federal Register / Vol. 80, No. 27 / Tuesday, February 10, 2015 / Rules and Regulations 

19 CFR Part 178 

Administrative practice and 

procedure, Exports, Imports, Reporting 

and recordkeeping requirements. 

Amendments to the Regulations 

For the reasons set forth above, 

chapter I of title 19, Code of Federal 

Regulations (19 CFR chapter I), is 

amended as set forth below. 

PART 10—ARTICLES CONDITIONALLY 

FREE, SUBJECT TO A REDUCED 

RATE, ETC. 

■ 1. The general authority citation for 

part 10 continues to read and the 

specific authority for new Subpart L is 

added to read as follows: 

Authority: 19 U.S.C. 66, 1202 (General 

Note 3(i), Harmonized Tariff Schedule of the 

United States), 1321, 1481, 1484, 1498, 1508, 

1623, 1624, 3314. 

* * * * * 

Sections 10.721 through 10.748 also issued 

under 19 U.S.C. 1202 (General Note 28, 

HTSUS) and Pub. L. 108–286, 118 Stat. 919 

(19 U.S.C. 3805 note). 

■ 2. In § 10.31(f), the last sentence is 

revised to read as follows: 

§ 10.31 Entry; bond. 

* * * * * 

(f) * * * In addition, notwithstanding 

any other provision of this paragraph, in 

the case of professional equipment 

necessary for carrying out the business 

activity, trade or profession of a 

business person, equipment for the 

press or for sound or television 

broadcasting, cinematographic 

equipment, articles imported for sports 

purposes and articles intended for 

display or demonstration, if brought 

into the United States by a resident of 

Canada, Mexico, Singapore, Chile, 

Morocco, Australia, El Salvador, 

Guatemala, Honduras, Nicaragua, the 

Dominican Republic, Costa Rica, 

Bahrain, Oman, Peru, the Republic of 

Korea, Colombia, or Panama and 

entered under Chapter 98, Subchapter 

XIII, HTSUS, no bond or other security 

will be required if the entered article is 

a good originating, within the meaning 

of General Notes 12, 25, 26, 27, 28, 29, 

30, 31, 32, 33, 34, and 35, HTSUS, in the 

country of which the importer is a 

resident. 

* * * * * 

■ 3. Add subpart L to read as follows: 

Subpart L—United States-Australia Free 

Trade Agreement 

General Provisions 

Sec. 

10.721 Scope. 

10.722 General definitions. 

Import Requirements 

10.723 Filing of claim for preferential tariff 

treatment upon importation. 

10.724 Supporting statement. 

10.725 Importer obligations. 

10.726 Supporting statement not required. 

10.727 Maintenance of records. 

10.728 Effect of noncompliance; failure to 

provide documentation regarding third 

country transportation. 

Rules of Origin 

10.729 Definitions. 

10.730 Originating goods. 

10.731 Textile and apparel goods 

classifiable as goods put up in sets. 

10.732 De minimis. 

10.733 Accumulation. 

10.734 Regional value content. 

10.735 Value of materials. 

10.736 Accessories, spare parts, or tools. 

10.737 Fungible goods and materials. 

10.738 Retail packaging materials and 

containers. 

10.739 Packing materials and containers for 

shipment. 

10.740 Indirect materials. 

10.741 Third country transportation. 

Origin Verifications and Determinations 

10.742 Verification and justification of 

claim for preferential treatment. 

10.743 Special rule for verifications in 

Australia of U.S. imports of textile and 

apparel goods. 

10.744 Issuance of negative origin 

determinations. 

Penalties 

10.745 General. 

10.746 Corrected claim or supporting 

statement. 

10.747 Framework for correcting claims or 

supporting statements. 

Goods Returned After Repair or Alteration 

10.748 Goods re-entered after repair or 

alteration in Australia. 

Subpart L—United States-Australia 

Free Trade Agreement 

General Provisions 

§ 10.721 Scope. 

This subpart implements the duty 

preference and related customs 

provisions applicable to imported goods 

under the United States-Australia Free 

Trade Agreement (the AFTA) signed on 

May 18, 2004, and under the United 

States-Australia Free Trade Agreement 

Implementation Act (‘‘the Act’’), Pub. L. 

108–286, 118 Stat. 919 (19 U.S.C. 3805 

note). Except as otherwise specified in 

this subpart, the procedures and other 

requirements set forth in this subpart 

are in addition to the customs 

procedures and requirements of general 

application contained elsewhere in this 

chapter. Additional provisions 

implementing certain aspects of the 

AFTA and the Act are contained in 

Parts 24, 162, and 163 of this chapter. 

§ 10.722 General definitions. 

As used in this subpart, the following 

terms will have the meanings indicated 

unless either the context in which they 

are used requires a different meaning or 

a different definition is prescribed for a 

particular section of this subpart: 

(a) Claim for preferential tariff 

treatment. ‘‘Claim for preferential tariff 

treatment’’ means a claim that a good is 

entitled to the duty rate applicable 

under the AFTA to an originating good, 

and to an exemption from the 

merchandise processing fee; 

(b) Claim of origin. ‘‘Claim of origin’’ 

means a claim that a textile or apparel 

good is an originating good or a good of 

a Party or satisfies the non-preferential 

rules of origin of a Party; 

(c) Customs duty. ‘‘Customs duty’’ 

includes any customs or import duty 

and a charge of any kind imposed in 

connection with the importation of a 

good, including any form of surtax or 

surcharge in connection with such 

importation, but does not include any: 

(1) Charge equivalent to an internal 

tax imposed consistently with Article 

III:2 of GATT 1994 in respect of the like 

domestic good or in respect of goods 

from which the imported good has been 

manufactured or produced in whole or 

in part; 

(2) Antidumping or countervailing 

duty that is applied pursuant to a 

Party’s law; or 

(3) Fee or other charge in connection 

with importation commensurate with 

the cost of services rendered; 

(d) Customs Valuation Agreement. 

‘‘Customs Valuation Agreement’’ means 

the Agreement on Implementation of 

Article VII of the General Agreement on 

Tariffs and Trade 1994, contained in 

Annex 1A to the WTO Agreement; 

(e) Days. ‘‘Days’’ means calendar days; 

(f) Enterprise. ‘‘Enterprise’’ means any 

entity constituted or organized under 

applicable law, whether or not for 

profit, and whether privately-owned or 

governmentally-owned or controlled, 

including any corporation, trust, 

partnership, sole proprietorship, joint 

venture, association, or similar 

organization; 

(g) Enterprise of a Party. ‘‘Enterprise 

of a Party’’ means an enterprise 

constituted or organized under a Party’s 

law; 

(h) GATT 1994. ‘‘GATT 1994’’ means 

the General Agreement on Tariffs and 

Trade 1994, contained in Annex 1A to 

the WTO Agreement; 

(i) Goods of a Party. ‘‘Goods of a 

Party’’ means domestic products as 

these are understood in the GATT 1994 

or such goods as the Parties determine 

under the rules of origin as applied in 


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Federal Register / Vol. 80, No. 27 / Tuesday, February 10, 2015 / Rules and Regulations 7309 

the normal course of trade, and includes 

originating goods of a Party. 

(j) Harmonized System. ‘‘Harmonized 

System’’ means the Harmonized 

Commodity Description and Coding 

System, including its General Rules of 

Interpretation, Section Notes, and 

Chapter Notes, as adopted and 

implemented by the Parties in their 

respective tariff laws; 

(k) Heading. ‘‘Heading’’ means the 

first four digits in the tariff classification 

number under the Harmonized System; 

(l) HTSUS. ‘‘HTSUS’’ means the 

Harmonized Tariff Schedule of the 

United States as promulgated by the 

U.S. International Trade Commission; 

(m) Identical goods. ‘‘Identical goods’’ 

means goods that are the same in all 

respects relevant to the rule of origin 

that qualifies the goods as originating 

goods; 

(n) Originating. ‘‘Originating’’ means 

qualifying for preferential tariff 

treatment under the rules of origin set 

out in AFTA Chapters Four (Textiles 

and Apparel) and Five (Rules of Origin) 

and General Note 28, HTSUS; 

(o) Party. ‘‘Party’’ means the United 

States or Australia; 

(p) Person. ‘‘Person’’ means a natural 

person or an enterprise; 

(q) Preferential tariff treatment. 

‘‘Preferential tariff treatment’’ means the 

duty rate applicable under the AFTA to 

an originating good, and an exemption 

from the merchandise processing fee; 

(r) Subheading. ‘‘Subheading’’ means 

the first six digits in the tariff 

classification number under the 

Harmonized System; 

(s) Territory. ‘‘Territory’’ means: 

(1) With respect to Australia, the 

territory of the Commonwealth of 

Australia: 

(i) Excluding all external territories 

other than the Territory of Norfolk 

Island, the Territory of Christmas Island, 

the Territory of Cocos (Keeling) Islands, 

the Territory of Ashmore and Cartier 

Islands, the Territory of Heard Island 

and McDonald Islands, and the Coral 

Sea Islands Territory; and 

(ii) Including Australia’s territorial 

sea, contiguous zone, exclusive 

economic zone, and continental shelf; 

and 

(2) With respect to the United States: 

(i) The customs territory of the United 

States, which includes the 50 states, the 

District of Columbia, and Puerto Rico; 

(ii) The foreign trade zones located in 

the United States and Puerto Rico; and 

(iii) Any areas beyond the territorial 

seas of the United States within which, 

in accordance with international law 

and its domestic law, the United States 

may exercise rights with respect to the 

seabed and subsoil and their natural 

resources; 

(t) Textile or apparel good. ‘‘Textile or 

apparel good’’ means a good listed in 

the Annex to the Agreement on Textiles 

and Clothing (commonly referred to as 

‘‘the ATC’’), which is part of the WTO 

Agreement; 

(u) WTO. ‘‘WTO’’ means the World 

Trade Organization; and 

(v) WTO Agreement. ‘‘WTO 

Agreement’’ means the Marrakesh 

Agreement Establishing the World Trade 

Organization of April 15, 1994. 

Import Requirements 

§ 10.723 Filing of claim for preferential 

tariff treatment upon importation. 

(a) Claim. An importer may make a 

claim for AFTA preferential tariff 

treatment, including an exemption from 

the merchandise processing fee, based 

on the importer’s knowledge or 

information in the importer’s possession 

that the good qualifies as an originating 

good. The claim is made by including 

on the entry summary, or equivalent 

documentation, the letters ‘‘AU’’ as a 

prefix to the subheading of the HTSUS 

under which each qualifying good is 

classified, or by the method specified 

for equivalent reporting via an 

authorized electronic data interchange 

system. 

(b) Corrected claim. If, after making 

the claim required under paragraph (a) 

of this section, the importer becomes 

aware that the claim is invalid, the 

importer must promptly and voluntarily 

correct the claim and pay any duties 

that may be due. The importer must 

submit a statement either in writing or 

via an authorized electronic data 

interchange system to the CBP office 

where the original claim was filed 

specifying the correction (see §§ 10.746 

and 10.747 of this subpart). 

§ 10.724 Supporting statement. 

(a) Contents. An importer who makes 

a claim under § 10.723(a) of this subpart 

must submit, at the request of the port 

director, a supporting statement setting 

forth the reasons that the good qualifies 

as an originating good, including 

pertinent cost and manufacturing data. 

A statement submitted to CBP under 

this paragraph: 

(1) Need not be in a prescribed format 

but must be in writing or must be 

transmitted electronically pursuant to 

any electronic means authorized by CBP 

for that purpose; 

(2) Must include the following 

information: 

(i) The legal name, address, 

telephone, and email address of the 

importer of record of the good; 

(ii) The legal name, address, 

telephone, and email address of the 

responsible official or authorized agent 

of the importer signing the supporting 

statement (if different from the 

information required by paragraph 

(a)(2)(i) of this section); 

(iii) The legal name, address, 

telephone, and email address of the 

exporter of the good (if different from 

the producer); 

(iv) The legal name, address, 

telephone, and email address of the 

producer of the good, if known; 

(v) A description of the good for 

which preferential tariff treatment is 

claimed, which must be sufficiently 

detailed to relate it to the invoice and 

the HS nomenclature; 

(vi) The HTSUS tariff classification, to 

six or more digits, as necessary for the 

specific change in tariff classification 

rule for the good set forth in General 

Note 28(n), HTSUS; 

(vii) The applicable rule of origin set 

forth in General Note 28, HTSUS, under 

which the good qualifies as an 

originating good; and 

(3) Must include a statement, in 

substantially the following form: 

I certify that: 

The information on this document is true 

and accurate and I assume the responsibility 

for proving such representations. I 

understand that I am liable for any false 

statements or material omissions made on or 

in connection with this document; 

I agree to maintain and present upon 

request, documentation necessary to support 

these representations; 

The goods originated or are considered to 

have originated in the territory of one or 

more of the Parties, and comply with the 

origin requirements specified for those goods 

in the United States-Australia Free Trade 

Agreement; there has been no further 

production or any other operation outside the 

territories of the parties, other than 

unloading, reloading, or any other operation 

necessary to preserve the goods in good 

condition or to transport the goods to the 

United States; and 

This document consists of ___ pages, 

including all attachments. 

(b) Responsible official or agent. The 

supporting statement required to be 

submitted under paragraph (a) of this 

section must be signed and dated by a 

responsible official of the importer or by 

the importer’s authorized agent having 

knowledge of the relevant facts. 

(c) Language. The supporting 

statement required to be submitted 

under paragraph (a) of this section must 

be completed in the English language. 

(d) Applicability of supporting 

statement. The supporting statement 

required to be submitted under 

paragraph (a) of this section may be 

applicable to: 

(1) A single importation of a good into 

the United States, including a single 

shipment that results in the filing of one 


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7310 Federal Register / Vol. 80, No. 27 / Tuesday, February 10, 2015 / Rules and Regulations 

or more entries and a series of 

shipments that results in the filing of 

one entry; or 

(2) Multiple importations of identical 

goods into the United States that occur 

within a specified blanket period, not 

exceeding 12 months, set out in the 

statement. For purposes of this 

paragraph, ‘‘identical goods’’ means 

goods that are the same in all respects 

relevant to the particular rule of origin 

that qualifies the goods as originating. 

§ 10.725 Importer obligations. 

(a) General. An importer who makes 

a claim under § 10.723(a) of this 

subpart: 

(1) Is responsible for the truthfulness 

of the claim and of all the information 

and data contained in the supporting 

statement provided for in § 10.724 of 

this subpart; and 

(2) Is responsible for submitting any 

supporting documents requested by CBP 

and for the truthfulness of the 

information contained in those 

documents. If CBP requests the 

submission of supporting documents, 

CBP will allow for the direct submission 

by the exporter or producer of business 

confidential or other sensitive 

information, including cost and 

sourcing information. 

(b) Information provided by exporter 

or producer. The fact that the importer 

has made a claim or submitted a 

supporting statement based on 

information provided by an exporter or 

producer will not relieve the importer of 

the responsibility referred to in the first 

sentence of paragraph (a) of this section. 

(c) Exemption from penalties. An 

importer will not be subject to civil or 

administrative penalties under 19 U.S.C. 

1592 for making an invalid claim for 

preferential tariff treatment or 

submitting an incorrect supporting 

statement, provided that the importer 

promptly and voluntarily corrects the 

claim or supporting statement and pays 

any duty owing (see §§ 10.746 and 

10.747 of this subpart). 

§ 10.726 Supporting statement not 

required. 

(a) General. Except as otherwise 

provided in paragraph (b) of this 

section, an importer will not be required 

to submit a supporting statement under 

§ 10.724 for: 

(1) A non-commercial importation of 

a good; or 

(2) A commercial importation for 

which the value of the originating goods 

does not exceed U.S. $2,500. 

(b) Exception. If the port director 

determines that an importation 

described in paragraph (a) of this 

section may reasonably be considered to 

have been carried out or planned for the 

purpose of evading compliance with the 

rules and procedures governing claims 

for preference under the AFTA, the port 

director will notify the importer that for 

that importation the importer must 

submit to CBP a supporting statement. 

The importer must submit such a 

statement within 30 days from the date 

of the notice. Failure to timely submit 

the supporting statement will result in 

denial of the claim for preferential tariff 

treatment. 

§ 10.727 Maintenance of records. 

(a) General. An importer claiming 

preferential tariff treatment for a good 

imported into the United States under 

§ 10.723(a) of this subpart must 

maintain, for five years after the date of 

importation of the good, records and 

documents necessary to demonstrate 

that the good qualifies as an originating 

good, including records and documents 

associated with: 

(1) The purchase of, cost of, value of, 

and payment for, the good; 

(2) Where appropriate, the purchase 

of, cost of, value of, and payment for, all 

materials, including recovered goods 

and indirect materials, used in the 

production of the good; and 

(3) Where appropriate, the production 

of the good in the form in which the 

good was exported. 

(b) Applicability of other 

recordkeeping requirements. The 

records and documents referred to in 

paragraph (a) of this section are in 

addition to any other records that the 

importer is required to prepare, 

maintain, or make available to CBP 

under Part 163 of this chapter. 

(c) Method of maintenance. The 

records and documents referred to in 

paragraph (a) of this section must be 

maintained by importers as provided in 

§ 163.5 of this chapter. 

§ 10.728 Effect of noncompliance; failure 

to provide documentation regarding third 

country transportation. 

(a) General. If the importer fails to 

comply with any requirement under this 

subpart, including submission of a 

complete supporting statement prepared 

in accordance with § 10.724 of this 

subpart, when requested, the port 

director may deny preferential treatment 

to the imported good. 

(b) Failure to provide documentation 

regarding third country transportation. 

Where the requirements for preferential 

treatment set forth elsewhere in this 

subpart are met, the port director 

nevertheless may deny preferential 

treatment to an originating good if the 

good is shipped through or transshipped 

in a country other than a Party to the 

AFTA, and the importer of the good 

does not provide, at the request of the 

port director, evidence demonstrating to 

the satisfaction of the port director that 

the conditions set forth in § 10.741 of 

this subpart were met. 

Rules of Origin 

§ 10.729 Definitions. 

For purposes of §§ 10.729 through 

10.741 of this subpart: 

(a) Adjusted value. ‘‘Adjusted value’’ 

means the value determined in 

accordance with Articles 1 through 8, 

Article 15, and the corresponding 

interpretative notes of the Customs 

Valuation Agreement, adjusted, if 

necessary, to exclude: 

(1) Any costs, charges, or expenses 

incurred for transportation, insurance 

and related services incidental to the 

international shipment of the good from 

the country of exportation to the place 

of importation; and 

(2) The value of packing materials and 

containers for shipment as defined in 

paragraph (n) of this section; 

(b) Class of motor vehicles. ‘‘Class of 

motor vehicles’’ means any one of the 

following categories of motor vehicles: 

(1) Motor vehicles classified under 

subheading 8701.20, motor vehicles for 

the transport of 16 or more persons 

classified under subheading 8702.10 or 

8702.90, and motor vehicles classified 

under subheading 8704.10, 8704.22, 

8704.23, 8704.32, or 8704.90, or heading 

8705 or 8706, HTSUS; 

(2) Motor vehicles classified under 

subheading 8701.10 or under any of 

subheadings 8701.30 through 8701.90, 

HTSUS; 

(3) Motor vehicles provided for the 

transport of 15 or fewer persons 

classified under subheading 8702.10 or 

8702.90, HTSUS, or motor vehicles 

classified under subheading 8704.21 or 

8704.31; or 

(4) Motor vehicles classified under 

subheadings 8703.21 through 8703.90, 

HTSUS; 

(c) Exporter. ‘‘Exporter’’ means a 

person who exports goods from the 

territory of a Party; 

(d) Fungible goods or materials. 

‘‘Fungible goods or materials’’ means 

goods or materials, as the case may be, 

that are interchangeable for commercial 

purposes and the properties of which 

are essentially identical; 

(e) Generally Accepted Accounting 

Principles. ‘‘Generally Accepted 

Accounting Principles’’ means the 

recognized consensus or substantial 

authoritative support in the territory of 

a Party, with respect to the recording of 

revenues, expenses, costs, assets, and 

liabilities, the disclosure of information, 


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Federal Register / Vol. 80, No. 27 / Tuesday, February 10, 2015 / Rules and Regulations 7311 

and the preparation of financial 

statements. These standards may 

encompass broad guidelines of general 

application as well as detailed 

standards, practices, and procedures; 

(f) Good. ‘‘Good’’ means any 

merchandise, product, article, or 

material; 

(g) Goods wholly obtained or 

produced entirely in the territory of one 

or both of the Parties. ‘‘Goods wholly 

obtained or produced entirely in the 

territory of one or both of the Parties’’ 

means: 

(1) Mineral goods extracted in the 

territory of one or both of the Parties; 

(2) Vegetable goods, as such goods are 

defined in the Harmonized System, 

harvested in the territory of one or both 

of the Parties; 

(3) Live animals born and raised in 

the territory of one or both of the 

Parties; 

(4) Goods obtained from hunting, 

trapping, fishing, or aquaculture 

conducted in the territory of one or both 

of the Parties; 

(5) Goods (fish, shellfish, and other 

marine life) taken from the sea by 

vessels registered or recorded with a 

Party and flying its flag; 

(6) Goods produced exclusively from 

products referred to in paragraph (g)(5) 

of this section on board factory ships 

registered or recorded with a Party and 

flying its flag; 

(7) Goods taken by a Party or a person 

of a Party from the seabed or beneath 

the seabed outside territorial waters, 

provided that a Party has rights to 

exploit such seabed; 

(8) Goods taken from outer space, 

provided they are obtained by a Party or 

a person of a Party and not processed in 

the territory of a non-Party; 

(9) Waste and scrap derived from: 

(i) Production in the territory of one 

or both of the Parties; or 

(ii) Used goods collected in the 

territory of one or both of the Parties, 

provided such goods are fit only for the 

recovery of raw materials; 

(10) Recovered goods derived in the 

territory of one or both of the Parties 

from goods that have passed their life 

expectancy, or are no longer useable due 

to defects, and utilized in the territory 

of one or both of the Parties in the 

production of remanufactured goods; or 

(11) Goods produced in one or both of 

the Parties exclusively from goods 

referred to in paragraphs (g)(1) through 

(9) of this section, or from the 

derivatives of such goods, at any stage 

of production; 

(h) Indirect Material. ‘‘Indirect 

material’’ means a good used in the 

production, testing, or inspection of 

another good in the territory of one or 

both of the Parties but not physically 

incorporated into that other good, or a 

good used in the maintenance of 

buildings or the operation of equipment 

associated with the production of 

another good, including: 

(1) Fuel and energy; 

(2) Tools, dies, and molds; 

(3) Spare parts and materials used in 

the maintenance of equipment or 

buildings; 

(4) Lubricants, greases, compounding 

materials, and other materials used in 

production or used to operate 

equipment or buildings; 

(5) Gloves, glasses, footwear, clothing, 

safety equipment, and supplies; 

(6) Equipment, devices, and supplies 

used for testing or inspecting the good; 

(7) Catalysts and solvents; and 

(8) Any other good that is not 

incorporated into the other good but the 

use of which in the production of the 

other good can reasonably be 

demonstrated to be a part of that 

production. 

(i) Material. ‘‘Material’’ means a good 

that is used in the production of another 

good; 

(j) Model line. ‘‘Model line’’ means a 

group of motor vehicles having the same 

platform or model name; 

(k) Net cost. ‘‘Net cost’’ means total 

cost minus sales promotion, marketing, 

and after-sales service costs, royalties, 

shipping and packing costs, and nonallowable interest costs that are 

included in the total cost; 

(l) Non-allowable interest costs. ‘‘Nonallowable interest costs’’ means interest 

costs incurred by a producer that exceed 

700 basis points above the applicable 

official interest rates for comparable 

maturities of the United States or 

Australia; 

(m) Non-originating good or nonoriginating material. ‘‘Non-originating 

good’’ or ‘‘non-originating material’’ 

means a good or material, as the case 

may be, that does not qualify as 

originating under General Note 28, 

HTSUS, or this subpart; 

(n) Packing materials and containers 

for shipment. ‘‘Packing materials and 

containers for shipment’’ means the 

goods used to protect a good during its 

transportation to the United States, and 

does not include the packaging 

materials and containers in which a 

good is packaged for retail sale; 

(o) Producer. ‘‘Producer’’ means a 

person who grows, raises, mines, 

harvests, fishes, traps, hunts, 

manufactures, processes, assembles or 

disassembles a good; 

(p) Production. ‘‘Production’’ means 

growing, raising, mining, harvesting, 

fishing, trapping, hunting, 

manufacturing, processing, assembling, 

or disassembling a good; 

(q) Reasonably allocate. ‘‘Reasonably 

allocate’’ means to apportion in a 

manner that would be appropriate 

under generally accepted accounting 

principles; 

(r) Recovered goods. ‘‘Recovered 

goods’’ means materials in the form of 

individual parts that result from: 

(1) The complete disassembly of 

goods which have passed their life 

expectancy, or are no longer useable due 

to defects, into individual parts; and 

(2) The cleaning, inspecting, or 

testing, or other processing that is 

necessary for improvement to sound 

working condition of such individual 

parts; 

(s) Remanufactured good. 

‘‘Remanufactured good’’ means an 

industrial good assembled in the 

territory of a Party that is classified in 

Chapter 84, 85, or 87, or heading 9026, 

9031, or 9032, HTSUS, other than a 

good classified in heading 8418 or 8516 

or any of headings 8701 through 8706, 

HTSUS, and that: 

(1) Is entirely or partially comprised 

of recovered goods; 

(2) Has a similar life expectancy to, 

and meets the same performance 

standards as, a like good that is new; 

and 

(3) Enjoys a factory warranty similar 

to a like good that is new; 

(t) Royalties. ‘‘Royalties’’ means 

payments of any kind, including 

payments under technical assistance 

agreements or similar agreements, made 

as consideration for the use of, or right 

to use, any copyright, literary, artistic, 

or scientific work, patent, trademark, 

design, model, plan, secret formula or 

process, excluding those payments 

under technical assistance agreements 

or similar agreements that can be related 

to specific services such as: 

(1) Personnel training, without regard 

to where performed; and 

(2) If performed in the territory of one 

or both of the Parties, engineering, 

tooling, die-setting, software design and 

similar computer services; 

(u) Sales promotion, marketing, and 

after-sales service costs. ‘‘Sales 

promotion, marketing, and after-sales 

service costs’’ means the following costs 

related to sales promotion, marketing, 

and after-sales service: 

(1) Sales and marketing promotion; 

media advertising; advertising and 

market research; promotional and 

demonstration materials; exhibits; sales 

conferences, trade shows and 

conventions; banners; marketing 

displays; free samples; sales, marketing 

and after-sales service literature 

(product brochures, catalogs, technical 

literature, price lists, service manuals, 

sales aid information); establishment 


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and protection of logos and trademarks; 

sponsorships; wholesale and retail 

restocking charges; entertainment; 

(2) Sales and marketing incentives; 

consumer, retailer or wholesaler rebates; 

merchandise incentives; 

(3) Salaries and wages, sales 

commissions, bonuses, benefits (for 

example, medical, insurance, pension), 

traveling and living expenses, 

membership and professional fees, for 

sales promotion, marketing and aftersales service personnel; 

(4) Recruiting and training of sales 

promotion, marketing and after-sales 

service personnel, and after-sales 

training of customers’ employees, where 

such costs are identified separately for 

sales promotion, marketing and aftersales service of goods on the financial 

statements or cost accounts of the 

producer; 

(5) Product liability insurance; 

(6) Office supplies for sales 

promotion, marketing and after-sales 

service of goods, where such costs are 

identified separately for sales 

promotion, marketing and after-sales 

service of goods on the financial 

statements or cost accounts of the 

producer; 

(7) Telephone, mail and other 

communications, where such costs are 

identified separately for sales 

promotion, marketing and after-sales 

service of goods on the financial 

statements or cost accounts of the 

producer; 

(8) Rent and depreciation of sales 

promotion, marketing and after-sales 

service offices and distribution centers; 

(9) Property insurance premiums, 

taxes, cost of utilities, and repair and 

maintenance of sales promotion, 

marketing and after-sales service offices 

and distribution centers, where such 

costs are identified separately for sales 

promotion, marketing and after-sales 

service of goods on the financial 

statements or cost accounts of the 

producer; and 

(10) Payments by the producer to 

other persons for warranty repairs; 

(v) Self-produced material. ‘‘Selfproduced material’’ means an 

originating material that is produced by 

a producer of a good and used in the 

production of that good; 

(w) Shipping and packing costs. 

‘‘Shipping and packing costs’’ means 

the costs incurred in packing a good for 

shipment and shipping the good from 

the point of direct shipment to the 

buyer, excluding the costs of preparing 

and packaging the good for retail sale; 

(x) Total cost. ‘‘Total cost’’ means all 

product costs, period costs, and other 

costs for a good incurred in the territory 

of one or both of the Parties. Product 

costs are costs that are associated with 

the production of a good and include 

the value of materials, direct labor costs, 

and direct overhead. Period costs are 

costs, other than product costs, that are 

expensed in the period in which they 

are incurred, such as selling expenses 

and general and administrative 

expenses. Other costs are all costs 

recorded on the books of the producer 

that are not product costs or period 

costs, such as interest. Total cost does 

not include profits that are earned by 

the producer, regardless of whether they 

are retained by the producer or paid out 

to other persons as dividends, or taxes 

paid on those profits, including capital 

gains taxes; 

(y) Used. ‘‘Used’’ means used or 

consumed in the production of goods; 

and 

(z) Value. ‘‘Value’’ means the value of 

a good or material for purposes of 

calculating customs duties or for 

purposes of applying this subpart. 

§ 10.730 Originating goods. 

Except as otherwise provided in this 

subpart and General Note 28, HTSUS, a 

good imported into the customs territory 

of the United States will be considered 

an originating good under the AFTA 

only if: 

(a) The good is wholly obtained or 

produced entirely in the territory of one 

or both of the Parties; 

(b) The good is produced entirely in 

the territory of one or both of the Parties 

and: 

(1) Each non-originating material used 

in the production of the good undergoes 

an applicable change in tariff 

classification specified in General Note 

28(n), HTSUS; 

(2) The good otherwise satisfies any 

applicable regional value content or 

other requirements specified in General 

Note 28(n), HTSUS; or 

(3) The good meets any other 

requirements specified in General Note 

28(n), HTSUS; 

(c) The good is produced entirely in 

the territory of one or both of the Parties 

exclusively from originating materials; 

or 

(d) The good otherwise qualifies as an 

originating good under General Note 

28(n), HTSUS. 

§ 10.731 Textile and apparel goods 

classifiable as goods put up in sets. 

Notwithstanding the specific rules set 

forth in General Note 28(n), HTSUS, 

textile or apparel goods classifiable as 

goods put up in sets for retail sale as 

provided for in General Rule of 

Interpretation 3, HTSUS, will not be 

considered to be originating goods 

unless each of the goods in the set is an 

originating good or the total value of the 

non-originating goods in the set does 

not exceed 10 percent of the value of the 

set. 

§ 10.732 De minimis. 

(a) Except as provided in paragraphs 

(b) and (c) of this section, a good that 

does not undergo a change in tariff 

classification pursuant to General Note 

28(n), HTSUS, is an originating good if: 

(1) The value of all non-originating 

materials used in the production of the 

good that do not undergo the applicable 

change in tariff classification does not 

exceed 10 percent of the adjusted value 

of the good; 

(2) The value of the non-originating 

materials described in paragraph (a)(1) 

of this section is included in the value 

of non-originating materials for any 

applicable regional value content 

requirement for the good under General 

Note 28(n), HTSUS; and 

(3) The good meets all other 

applicable requirements of General Note 

28, HTSUS. 

(b) Paragraph (a) does not apply to: 

(1) A non-originating material 

provided for in Chapter 4, HTSUS, or in 

subheading 1901.90, HTSUS, that is 

used in the production of a good 

provided for in Chapter 4, HTSUS; 

(2) A non-originating material 

provided for in Chapter 4, HTSUS, or in 

subheading 1901.90, HTSUS, that is 

used in the production of a good 

provided for in one of the following 

HTSUS provisions: subheading 1901.10, 

1901.20 or 1901.90; heading 2105; or 

subheading 2106.90, 2202.90 or 

2309.90; 

(3) A non-originating material 

provided for in heading 0805, HTSUS, 

or subheadings 2009.11 through 

2009.39, HTSUS, that is used in the 

production of a good provided for in 

subheadings 2009.11 through 2009.39, 

HTSUS, or in subheading 2106.90 or 

2202.90, HTSUS; 

(4) A non-originating material 

provided for in Chapter 15, HTSUS, that 

is used in the production of a good 

provided for in headings 1501 through 

1508, 1512, 1514 or 1515, HTSUS; 

(5) A non-originating material 

provided for in heading 1701, HTSUS, 

that is used in the production of a good 

provided for in headings 1701 through 

1703, HTSUS; 

(6) A non-originating material 

provided for in Chapter 17, HTSUS, or 

heading 1805, HTSUS, that is used in 

the production of a good provided for in 

subheading 1806.10, HTSUS; 

(7) A non-originating material 

provided for in headings 2203 through 

2208, HTSUS, that is used in the 


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production of a good provided for in 

heading 2207 or 2208, HTSUS; or 

(8) A non-originating material used in 

the production of a good provided for in 

Chapters 1 through 21, HTSUS, unless 

the non-originating material is provided 

for in a different subheading than the 

good for which origin is being 

determined. 

(c) A textile or apparel good provided 

for in Chapters 42, 50 through 63, 70, or 

94, HTSUS, that is not an originating 

good because certain fibers or yarns 

used in the production of the 

component of the good that determines 

the tariff classification of the good do 

not undergo an applicable change in 

tariff classification set out in General 

Note 28(n), HTSUS, will nevertheless be 

considered to be an originating good if 

the total weight of all such fibers or 

yarns in that component is not more 

than 7 percent of the total weight of that 

component. Notwithstanding the 

preceding sentence, a textile or apparel 

good containing elastomeric yarns in the 

component of the good that determines 

the tariff classification of the good will 

be considered an originating good only 

if such yarns are wholly formed in the 

territory of a Party. For purposes of this 

paragraph, in the case of a textile or 

apparel good that is a yarn, fabric, or 

group of fibers, the term ‘‘component of 

the good that determines the tariff 

classification of the good’’ means all of 

the fibers in the yarn, fabric, or group 

of fibers. 

§ 10.733 Accumulation. 

(a) Originating materials from the 

territory of a Party that are used in the 

production of a good in the territory of 

another Party will be considered to 

originate in the territory of that other 

Party. 

(b) A good that is produced in the 

territory of one or both of the Parties by 

one or more producers is an originating 

good if the good satisfies the 

requirements of § 10.730 of this subpart 

and all other applicable requirements of 

General Note 28, HTSUS. 

§ 10.734 Regional value content. 

(a) General. Except for goods to which 

paragraph (d) of this section applies, 

where General Note 28(n), HTSUS, sets 

forth a rule that specifies a regional 

value content test for a good, the 

regional value content of such good 

must be calculated by the importer, 

exporter, or producer of the good on the 

basis of the build-down method 

described in paragraph (b) of this 

section or the build-up method 

described in paragraph (c) of this 

section. 

(b) Build-down method. Under the 

build-down method, the regional value 

content must be calculated on the basis 

of the formula RVC = ((AV ¥ VNM)/

AV) × 100, where RVC is the regional 

value content, expressed as a 

percentage; AV is the adjusted value of 

the good; and VNM is the value of nonoriginating materials that are acquired 

and used by the producer in the 

production of the good, but does not 

include the value of a material that is 

self-produced. 

(c) Build-up method. Under the buildup method, the regional value content 

must be calculated on the basis of the 

formula RVC = (VOM/AV) × 100, where 

RVC is the regional value content, 

expressed as a percentage; AV is the 

adjusted value of the good; and VOM is 

the value of originating materials that 

are acquired or self-produced and used 

by the producer in the production of the 

good. 

(d) Special rule for certain automotive 

goods—(1) General. Where General Note 

28(n), HTSUS, sets forth a rule that 

specifies a regional value content test 

for an automotive good provided for in 

subheadings 8407.31 through 8407.34 

(engines), subheading 8408.20 (diesel 

engine for vehicles), heading 8409 (parts 

of engines), or any of headings 8701 

through 8705 (motor vehicles), and 

headings 8706 (chassis), 8707 (bodies), 

and 8708 (motor vehicle parts), HTSUS, 

the regional value content of such good 

must be calculated by the importer, 

exporter, or producer of the good on the 

basis of the net cost methods described 

in paragraphs (d)(2) through (4) of this 

section. 

(2) Net cost method. Under the net 

cost method, the regional value content 

must be calculated on the basis of the 

formula RVC = ((NC ¥ VNM)/NC) × 

100, where RVC is the regional value 

content, expressed as a percentage; NC 

is the net cost of the good; and VNM is 

the value of non-originating materials 

that are acquired and used by the 

producer in the production of the good, 

but does not include the value of a 

material that is self-produced. 

Consistent with the provisions regarding 

allocation of costs set out in generally 

accepted accounting principles, the net 

cost of the good must be determined by: 

(i) Calculating the total cost incurred 

with respect to all goods produced by 

the producer of the automotive good, 

subtracting any sales promotion, 

marketing and after-sales service costs, 

royalties, shipping and packing costs, 

and non-allowable interest costs that are 

included in the total cost of all such 

goods, and then reasonably allocating 

the resulting net cost of those goods to 

the automotive good; 

(ii) Calculating the total cost incurred 

with respect to all goods produced by 

the producer of the automotive good, 

reasonably allocating the total cost to 

the automotive good, and then 

subtracting any sales promotion, 

marketing and after-sales service costs, 

royalties, shipping and packing costs, 

and non-allowable interest costs that are 

included in the portion of the total cost 

allocated to the automotive good; or 

(iii) Reasonably allocating each cost 

that forms part of the total costs 

incurred with respect to the automotive 

good so that the aggregate of these costs 

does not include any sales promotion, 

marketing and after-sales service costs, 

royalties, shipping and packing costs, or 

non-allowable interest costs. 

(3) Motor vehicles—(i) General. For 

purposes of calculating the regional 

value content under the net cost method 

for an automotive good that is a motor 

vehicle provided for in headings 8701 

through 8705, an importer, exporter, or 

producer may average the amounts 

calculated under the formula set forth in 

paragraph (d)(2) of this section over the 

producer’s fiscal year using any one of 

the categories described in paragraph 

(d)(3)(ii) of this section either on the 

basis of all motor vehicles in the 

category or only those motor vehicles in 

the category that are exported to the 

territory of a Party. 

(ii) Categories. The categories referred 

to in paragraph (d)(3)(i) of this section 

are as follows: 

(A) The same model line of motor 

vehicles, in the same class of vehicles, 

produced in the same plant in the 

territory of a Party, as the motor vehicle 

for which the regional value content is 

being calculated; 

(B) The same class of motor vehicles, 

produced in the same plant in the 

territory of a Party, as the motor vehicle 

for which the regional value content is 

being calculated; and 

(C) The same model line of motor 

vehicles produced in the territory of a 

Party as the motor vehicle for which the 

regional value content is being 

calculated. 

(4) Other automotive goods—(i) 

General. For purposes of calculating the 

regional value content under the net 

cost method for automotive goods 

provided for in subheadings 8407.31 

through 8407.34, subheading 8408.20, 

heading 8409, 8706, 8707, or 8708, 

HTSUS, that are produced in the same 

plant, an importer, exporter, or producer 

may: 

(A) Average the amounts calculated 

under the formula set forth in paragraph 

(d)(2) of this section over any of the 

following: The fiscal year, or any quarter 

or month, of the motor vehicle producer 


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to whom the automotive good is sold, or 

the fiscal year, or any quarter or month, 

of the producer of the automotive good, 

provided the goods were produced 

during the fiscal year, quarter, or month 

that is the basis for the calculation; 

(B) Determine the average referred to 

in paragraph (d)(4)(i)(A) of this section 

separately for such goods sold to one or 

more motor vehicle producers; or 

(C) Make a separate determination 

under paragraph (d)(4)(i)(A) or (B) for 

automotive goods that are exported to 

the territory of a Party. 

(ii) Duration of use. A person 

selecting an averaging period of one 

month or quarter under paragraph 

(d)(4)(i)(A) of this section must continue 

to use that method for that category of 

automotive goods throughout the fiscal 

year. 

10.735 Value of materials. 

(a) Calculating the value of materials. 

For purposes of calculating the regional 

value content of a good under General 

Note 28(n), HTSUS, and for purposes of 

applying the de minimis (see § 10.732 of 

this subpart) provisions of General Note 

28(n), HTSUS, the value of a material is: 

(1) In the case of a material imported 

by the producer of the good, the 

adjusted value of the material; 

(2) In the case of a material acquired 

by the producer in the territory where 

the good is produced, the value, 

determined in accordance with Articles 

1 through 8, Article 15, and the 

corresponding interpretative notes of 

the Customs Valuation Agreement, of 

the material with reasonable 

modifications to the provisions of the 

Customs Valuation Agreement as may 

be required due to the absence of an 

importation by the producer (including, 

but not limited to, treating a domestic 

purchase by the producer as if it were 

a sale for exportation to the country of 

importation); or 

(3) In the case of a self-produced 

material, the sum of: 

(i) All expenses incurred in the 

production of the material, including 

general expenses; and 

(ii) An amount for profit equivalent to 

the profit added in the normal course of 

trade. 

(b) Examples. The following examples 

illustrate application of the principles 

set forth in paragraph (a)(2) of this 

section: 

Example 1. The producer in Australia 

purchases material x from an unrelated seller 

in Australia for $100. Under the provisions 

of Article 1 of the Customs Valuation 

Agreement, transaction value is the price 

actually paid or payable for the goods when 

sold for exportation to the country of 

importation adjusted in accordance with the 

provisions of Article 8. In order to apply 

Article 1 to this domestic purchase by the 

producer, such purchase is treated as if it 

were a sale for export to the country of 

importation. Therefore, for purposes of 

determining the adjusted value of material x, 

the Article 1 transaction value is the price 

actually paid or payable for the goods when 

sold to the producer in Australia ($100), 

adjusted in accordance with the provisions of 

Article 8. In this example, it is irrelevant 

whether material x was initially imported 

into Australia by the seller (or by anyone 

else). So long as the producer acquired 

material x in Australia, it is intended that the 

value of material x will be determined on the 

basis of the price actually paid or payable by 

the producer adjusted in accordance with the 

provisions of Article 8. 

Example 2. Same facts as in Example 1, 

except that the sale between the seller and 

the producer is subject to certain restrictions 

that preclude the application of Article 1. 

Under Article 2 of the Customs Valuation 

Agreement, the value is the transaction value 

of identical goods sold for exportation to the 

same country of importation and exported at 

or about the same time as the goods being 

valued. In order to permit the application of 

Article 2 to the domestic acquisition by the 

producer, the price paid by the producer 

should be modified so that the value is the 

transaction value of identical goods sold 

within Australia at or about the same time 

the goods were sold to the producer in 

Australia. Thus, if the seller of material x also 

sold an identical material to another buyer in 

Australia without restrictions, that other sale 

would be used to determine the adjusted 

value of material x. 

(c) Permissible additions to, and 

deductions from, the value of 

materials—(1) Additions to originating 

materials. For originating materials, the 

following expenses, if not included 

under paragraph (a) of this section, may 

be added to the value of the originating 

material: 

(i) The costs of freight, insurance, 

packing, and all other costs incurred in 

transporting the material within or 

between the territory of one or both of 

the Parties to the location of the 

producer; 

(ii) Duties, taxes, and customs 

brokerage fees on the material paid in 

the territory of one or both of the 

Parties, other than duties and taxes that 

are waived, refunded, refundable or 

otherwise recoverable, including credit 

against duty or tax paid or payable; and 

(iii) The cost of waste and spoilage 

resulting from the use of the material in 

the production of the good, less the 

value of renewable scrap or byproducts. 

(2) Deductions from non-originating 

materials. For non-originating materials, 

if included under paragraph (a) of this 

section, the following expenses may be 

deducted from the value of the nonoriginating material: 

(i) The costs of freight, insurance, 

packing, and all other costs incurred in 

transporting the material within or 

between the territory of one or both of 

the Parties to the location of the 

producer; 

(ii) Duties, taxes, and customs 

brokerage fees on the material paid in 

the territory of one or both of the 

Parties, other than duties and taxes that 

are waived, refunded, refundable or 

otherwise recoverable, including credit 

against duty or tax paid or payable; 

(iii) The cost of waste and spoilage 

resulting from the use of the material in 

the production of the good, less the 

value of renewable scrap or by-products; 

(iv) The cost of processing incurred in 

the territory of one or both of the Parties 

in the production of the non-originating 

material; and 

(v) The cost of originating materials 

used in the production of the nonoriginating material in the territory of 

one or both of the Parties. 

(d) Accounting method. Any cost or 

value referenced in General Note 28, 

HTSUS, and this subpart, must be 

recorded and maintained in accordance 

with the generally accepted accounting 

principles applicable in the territory of 

the Party in which the good is 

produced. 

§ 10.736 Accessories, spare parts, or 

tools. 

(a) General. Accessories, spare parts, 

or tools that are delivered with a good 

and that form part of the good’s 

standard accessories, spare parts, or 

tools will be treated as originating goods 

if the good is an originating good, and 

will be disregarded in determining 

whether all the non-originating 

materials used in the production of the 

good undergo an applicable change in 

tariff classification specified in General 

Note 28(n), HTSUS, provided that: 

(1) The accessories, spare parts, or 

tools are not invoiced separately from 

the good; and 

(2) The quantities and value of the 

accessories, spare parts, or tools are 

customary for the good. 

(b) Regional value content. If the good 

is subject to a regional value content 

requirement, the value of the 

accessories, spare parts, or tools is taken 

into account as originating or nonoriginating materials, as the case may 

be, in calculating the regional value 

content of the good under § 10.734 of 

this subpart. 

§ 10.737 Fungible goods and materials. 

(a) General. A person claiming that a 

fungible good or material is an 

originating good may base the claim 

either on the physical segregation of the 

fungible good or material or by using an 

inventory management method with 


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respect to the fungible good or material. 

For purposes of this section, the term 

‘‘inventory management method’’ 

means: 

(1) Averaging; 

(2) ‘‘Last-in, first-out;’’ 

(3) ‘‘First-in, first-out;’’ or 

(4) Any other method that is 

recognized in the Generally Accepted 

Accounting Principles of the Party in 

which the production is performed or 

otherwise accepted by that country. 

(b) Duration of use. A person selecting 

an inventory management method 

under paragraph (a) of this section for a 

particular fungible good or material 

must continue to use that method for 

that fungible good or material 

throughout the fiscal year of that person. 

§ 10.738 Retail packaging materials and 

containers. 

(a) Effect on tariff shift rule. Packaging 

materials and containers in which a 

good is packaged for retail sale, if 

classified with the good for which 

preferential tariff treatment under the 

AFTA is claimed, will be disregarded in 

determining whether all non-originating 

materials used in the production of the 

good undergo the applicable change in 

tariff classification set out in General 

Note 28(n), HTSUS. 

(b) Effect on regional value content 

calculation. If the good is subject to a 

regional value content requirement, the 

value of such packaging materials and 

containers will be taken into account as 

originating or non-originating materials, 

as the case may be, in calculating the 

regional value content of the good. 

Example 1. Australian Producer A of good 

C imports 100 non-originating blister 

packages to be used as retail packaging for 

good C. As provided in § 10.735(a)(1) of this 

subpart, the value of the blister packages is 

their adjusted value, which in this case is 

$10. Good C has a regional value content 

requirement. The United States importer of 

good C decides to use the build-down 

method, RVC = ((AV ¥ VNM)/AV) × 100 (see 

§ 10.734(b) of this subpart), in determining 

whether good C satisfies the regional value 

content requirement. In applying this 

method, the non-originating blister packages 

are taken into account as non-originating. As 

such, their $10 adjusted value is included in 

the VNM, value of non-originating materials, 

of good C. 

Example 2. Same facts as in Example 1, 

except that the blister packages are 

originating. In this case, the adjusted value of 

the originating blister packages would not be 

included as part of the VNM of good C under 

the build-down method. However, if the U.S. 

importer had used the build-up method, RVC 

= (VOM/AV) × 100 (see § 10.734(c) of this 

subpart), the adjusted value of the blister 

packaging would be included as part of the 

VOM, value of originating materials. 

§ 10.739 Packing materials and containers 

for shipment. 

(a) Effect on tariff shift rule. Packing 

materials and containers for shipment, 

as defined in § 10.729 (n) of this 

subpart, are to be disregarded in 

determining whether the nonoriginating materials used in the 

production of the good undergo an 

applicable change in tariff classification 

set out in General Note 28(n), HTSUS. 

Accordingly, such materials and 

containers are not required to undergo 

the applicable change in tariff 

classification even if they are nonoriginating. 

(b) Effect on regional value content 

calculation. Packing materials and 

containers for shipment, as defined in 

§ 10.729(n) of this subpart, are to be 

disregarded in determining the regional 

value content of a good imported into 

the United States. Accordingly, in 

applying the build-down, build-up, or 

net cost method for determining the 

regional value content of a good 

imported into the United States, the 

value of such packing materials and 

containers for shipment (whether 

originating or non-originating) is 

disregarded and not included in AV, 

adjusted value, VNM, value of nonoriginating materials, VOM, value of 

originating materials, or NC, net cost of 

a good. 

Example. Australian Producer A produces 

good C. Producer A ships good C to the U.S. 

in a shipping container which it purchased 

from Company B in Australia. The shipping 

container is originating. The value of the 

shipping container determined under section 

§ 10.735(a)(2) of this subpart is $3. Good C is 

subject to a regional value content 

requirement. The transaction value of good C 

is $100, which includes the $3 shipping 

container. The United States importer 

decides to use the build-up method, RVC = 

(VOM/AV) × 100 (see § 10.734(c) of this 

subpart), in determining whether good C 

satisfies the regional value content 

requirement. In determining the AV, adjusted 

value, of good C imported into the U.S., 

paragraph (b) of this section and the 

definition of AV require a $3 deduction for 

the value of the shipping container. 

Therefore, the AV is $97 ($100 ¥ $3). In 

addition, the value of the shipping container 

is disregarded and not included in the VOM, 

value of originating materials. 

§ 10.740 Indirect materials. 

An indirect material, as defined in 

§ 10.729(h) of this subpart, will be 

considered to be an originating material 

without regard to where it is produced, 

and its value will be the cost registered 

in the accounting records of the 

producer of the good. 

Example. Australian Producer C produces 

good C using non-originating material A. 

Producer C imports non-originating rubber 

gloves for use by workers in the production 

of good C. Good C is subject to a tariff shift 

requirement. As provided in § 10.730(b)(1) of 

this subpart and General Note 28(n), each of 

the non-originating materials in good C must 

undergo the specified change in tariff 

classification in order for good C to be 

considered originating. Although nonoriginating material A must undergo the 

applicable tariff shift in order for good C to 

be considered originating, the rubber gloves 

do not because they are indirect materials 

and are considered originating without 

regard to where they are produced. 

§ 10.741 Third country transportation. 

(a) General. A good that has 

undergone production necessary to 

qualify as an originating good under 

§ 10.730 of this subpart will not be 

considered an originating good if, 

subsequent to that production, the good 

undergoes further production or any 

other operation outside the territories of 

the Parties, other than unloading, 

reloading, or any other operation 

necessary to preserve the good in good 

condition or to transport the good to the 

territory of a Party. 

(b) Documentary evidence. An 

importer making a claim that a good is 

originating may be required to 

demonstrate, to CBP’s satisfaction, that 

no further production or subsequent 

operation, other than permitted under 

paragraph (a) of this section, occurred 

outside the territories of the Parties. An 

importer may demonstrate compliance 

with this section by submitting 

documentary evidence. Such evidence 

may include, but is not limited to, bills 

of lading, airway bills, packing lists, 

commercial invoices, receiving and 

inventory records, and customs entry 

and exit documents. 

Origin Verifications and 

Determinations 

§ 10.742 Verification and justification of 

claim for preferential treatment. 

(a) Verification. A claim for 

preferential tariff treatment made under 

§ 10.723(a) of this subpart, including 

any statements or other information 

submitted to CBP in support of the 

claim, will be subject to such 

verification as the port director deems 

necessary. In the event that the port 

director is provided with insufficient 

information to verify or substantiate the 

claim, the port director may deny the 

claim for preferential treatment. A 

verification of a claim for preferential 

treatment may be conducted by means 

of one or more of the following: 

(1) Requests for information from the 

importer; 

(2) Written requests for information to 

the exporter or producer; 


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7316 Federal Register / Vol. 80, No. 27 / Tuesday, February 10, 2015 / Rules and Regulations 

(3) Requests for the importer to 

arrange for the exporter or producer to 

provide information directly to CBP; 

(4) Visits to the premises of the 

exporter or producer in Australia, in 

accordance with procedures that the 

Parties adopt pertaining to the 

verification; and 

(5) Such other procedures as the 

Parties may agree. 

(b) Applicable accounting principles. 

When conducting a verification of origin 

to which Generally Accepted 

Accounting Principles may be relevant, 

CBP will apply and accept the Generally 

Accepted Accounting Principles 

applicable in the country of production. 

§ 10.743 Special rule for verifications in 

Australia of U.S. imports of textile and 

apparel goods. 

(a) Procedures to determine whether a 

claim of origin is accurate. For the 

purpose of determining that a claim of 

origin for a textile or apparel good is 

accurate, CBP may request that the 

government of Australia conduct a 

verification, regardless of whether a 

claim is made for preferential tariff 

treatment. While a verification under 

this paragraph is being conducted, CBP, 

if directed by the President, may take 

appropriate action which may include 

suspending the application of 

preferential tariff treatment to the textile 

or apparel good for which a claim of 

origin has been made. If an exporter, 

producer, or other person refuses to 

consent to a visit as provided for in this 

paragraph, or if CBP is unable to make 

the determination described in this 

paragraph within 12 months after a 

request for a verification, or CBP makes 

a negative determination, CBP, if 

directed by the President, may take 

appropriate action which may include 

denying the application of preferential 

tariff treatment to the textile or apparel 

good subject to the verification, and to 

similar goods exported or produced by 

the entity that exported or produced the 

good. 

(b) Procedures to determine 

compliance with applicable customs 

laws and regulations of the U.S. For 

purposes of enabling CBP to determine 

that an exporter or producer is 

complying with applicable customs 

laws, regulations, and procedures in 

cases in which CBP has a reasonable 

suspicion that an Australian exporter or 

producer is engaging in unlawful 

activity relating to trade in textile and 

apparel goods, CBP may request that the 

government of Australia conduct a 

verification, regardless of whether a 

claim is made for preferential tariff 

treatment. A ‘‘reasonable suspicion’’ for 

the purpose of this paragraph will be 

based on relevant factual information, 

including information of the type set 

forth in Article 6.5 of the AFTA, which 

indicates circumvention of applicable 

laws, regulations or procedures 

regarding trade in textile and apparel 

goods. While a verification under this 

paragraph is being conducted, CBP, if 

directed by the President, may take 

appropriate action which may include 

suspending the application of 

preferential tariff treatment to the textile 

and apparel goods exported or produced 

by the Australian entity where the 

reasonable suspicion of unlawful 

activity relates to those goods. If an 

exporter, producer, or other person 

refuses to consent to a visit as provided 

for in this paragraph, or if CBP is unable 

to make the determination described in 

this paragraph within 12 months after a 

request for a verification, or makes a 

negative determination, CBP, if directed 

by the President, may take appropriate 

action which may include denying the 

application of preferential tariff 

treatment to any textile or apparel goods 

exported or produced by the entity 

subject to the verification. 

(c) Assistance by U.S. officials to 

Australian authorities. U.S. officials 

may undertake or assist in a verification 

under this section by conducting visits 

in Australia, along with the competent 

authorities of Australia, to the premises 

of an exporter, producer or any other 

enterprise involved in the movement of 

textile or apparel goods from Australia 

to the United States. 

(d) Treatment of documents and 

information provided to CBP. Any 

production, trade and transit documents 

and other information necessary to 

conduct a verification under this 

section, provided to CBP by the 

government of Australia consistent with 

the laws, regulations, and procedures of 

Australia, will be treated as confidential 

in accordance with Article 22.4 of the 

AFTA (Disclosure of Information). 

(e) Continuation of appropriate 

action. CBP may continue to take 

appropriate action under paragraph (a) 

or (b) of this section until it receives 

information sufficient to enable it to 

make the determination described in 

paragraphs (a) and (b) of this section. 

§ 10.744 Issuance of negative origin 

determinations. 

If, as a result of an origin verification 

initiated under this subpart, CBP 

determines that a claim for preferential 

tariff treatment made under § 10.723(a) 

of this subpart should be denied, it will 

issue a determination in writing or via 

an authorized electronic data 

interchange system to the importer that 

sets forth the following: 

(a) A description of the good that was 

the subject of the verification together 

with the identifying numbers and dates 

of the import documents pertaining to 

the good; 

(b) A statement setting forth the 

findings of fact made in connection with 

the verification and upon which the 

determination is based; and 

(c) With specific reference to the rules 

applicable to originating goods as set 

forth in General Note 28, HTSUS, and 

in §§ 10.729 through 10.741 of this 

subpart, the legal basis for the 

determination. 

Penalties 

§ 10.745 General. 

Except as otherwise provided in this 

subpart, all criminal, civil or 

administrative penalties which may be 

imposed on U.S. importers for 

violations of the customs and related 

laws and regulations will also apply to 

U.S. importers for violations of the laws 

and regulations relating to the AFTA. 

§ 10.746 Corrected claim or supporting 

statement. 

An importer who makes a corrected 

claim under § 10.723(b) of this subpart 

will not be subject to civil or 

administrative penalties under 19 U.S.C. 

1592 for having made an incorrect claim 

or having submitted an incorrect 

supporting statement, provided that the 

corrected claim or supporting statement 

is promptly and voluntarily made 

pursuant to the terms set forth in 

§ 10.747 of this subpart. 

§ 10.747 Framework for correcting claims 

or supporting statements. 

(a) ‘‘Promptly and voluntarily’’ 

defined. Except as provided for in 

paragraph (b) of this section, for 

purposes of this subpart, the making of 

a corrected claim or supporting 

statement will be deemed to have been 

done promptly and voluntarily if: 

(1)(i) Done within one year following 

the date on which the importer made 

the incorrect claim; or 

(ii) Done later than one year following 

the date on which the importer made 

the incorrect claim, provided the 

corrected claim is made: 

(A) Before the commencement of a 

formal investigation, within the 

meaning of § 162.74(g) of this chapter; 

or 

(B) Before any of the events specified 

in § 162.74(i) of this chapter have 

occurred; or 

(C) Within 30 days after the importer 

initially becomes aware that the 

incorrect claim is not valid; and 


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Federal Register / Vol. 80, No. 27 / Tuesday, February 10, 2015 / Rules and Regulations 7317 

(2) Accompanied by a statement 

setting forth the information specified in 

paragraph (c) of this section; and 

(3) Accompanied or followed by a 

tender of any actual loss of duties and 

merchandise processing fees, if 

applicable, in accordance with 

paragraph (d) of this section. 

(b) Exception in cases involving fraud 

or subsequent incorrect claims. (1) 

Fraud. Notwithstanding paragraph (a) of 

this section, an importer who acted 

fraudulently in making an incorrect 

claim may not make a voluntary 

correction of that claim. For purposes of 

this paragraph, the term ‘‘fraud’’ will 

have the meaning set forth in paragraph 

(C)(3) of Appendix B to Part 171 of this 

chapter. 

(2) Subsequent incorrect claims. An 

importer who makes one or more 

incorrect claims after becoming aware 

that a claim involving the same 

merchandise and circumstances is 

invalid may not make a voluntary 

correction of the subsequent claims 

pursuant to paragraph (a) of this section. 

(c) Statement. For purposes of this 

subpart, each corrected claim must be 

accompanied by a statement, submitted 

in writing or via an authorized 

electronic data interchange system, 

which: 

(1) Identifies the class or kind of good 

to which the incorrect claim relates; 

(2) Identifies each affected import 

transaction, including each port of 

importation and the approximate date of 

each importation; 

(3) Specifies the nature of the 

incorrect statements or omissions 

regarding the claim; and 

(4) Sets forth, to the best of the 

person’s knowledge, the true and 

accurate information or data which 

should have been covered by or 

provided in the claim, and states that 

the person will provide any additional 

information or data which is unknown 

at the time of making the corrected 

claim within 30 days or within any 

extension of that 30-day period as CBP 

may permit in order for the person to 

obtain the information or data. 

(d) Tender of actual loss of duties. A 

U.S. importer who makes a corrected 

claim must tender any actual loss of 

duties at the time of making the 

corrected claim, or within one (1) year 

thereafter, or within any extension of 

that 1-year period as CBP may allow in 

order for the importer to obtain the 

information or data necessary to 

calculate the duties owed. 

Goods Returned After Repair or 

Alteration 

§ 10.748 Goods re-entered after repair or 

alteration in Australia. 

(a) General. This section sets forth the 

rules which apply for purposes of 

obtaining duty-free treatment on goods 

returned after repair or alteration in 

Australia as provided for in subheadings 

9802.00.40 and 9802.00.50, HTSUS. 

Goods returned after having been 

repaired or altered in Australia, whether 

or not pursuant to a warranty, are 

eligible for duty-free treatment, 

provided that the requirements of this 

section are met. For purposes of this 

section, ‘‘repairs or alterations’’ means 

restoration, addition, renovation, redyeing, cleaning, re-sterilizing, or other 

treatment which does not destroy the 

essential characteristics of, or create a 

new or commercially different good 

from, the good exported from the United 

States. The term ‘‘repair or alternation’’ 

does not include an operation or process 

that transforms an unfinished good into 

a finished good. 

(b) Goods not eligible for duty-free 

treatment after repair or alteration. The 

duty-free treatment referred to in 

paragraph (a) of this section will not 

apply to goods which, in their condition 

as exported from the United States to 

Australia, are incomplete for their 

intended use and for which the 

processing operation performed in 

Australia constitutes an operation that is 

performed as a matter of course in the 

preparation or manufacture of finished 

goods. 

(c) Documentation. The provisions of 

§ 10.8(a) through (c) of this part, relating 

to the documentary requirements for 

goods entered under subheading 

9802.00.40 or 9802.00.50, HTSUS, will 

apply in connection with the entry of 

goods which are returned from Australia 

after having been exported for repairs or 

alterations and which are claimed to be 

duty free. 

PART 24—CUSTOMS FINANCIAL AND 

ACCOUNTING PROCEDURE 

■ 4. The general authority citation for 

Part 24 and specific authority for § 24.23 

continue to read as follows: 

Authority: 5 U.S.C. 301; 19 U.S.C. 58a–58c, 

66, 1202 (General Note 3(i), Harmonized 

Tariff Schedule of the United States), 1505, 

1520, 1624; 26 U.S.C. 4461, 4462; 31 U.S.C. 

9701; Pub. L. 107–296, 116 Stat. 2135 (6 

U.S.C. 1 et seq.). 

* * * * * 

Section 24.23 also issued under 19 U.S.C. 

3332; 

* * * * * 

■ 5. Section 24.23 is amended by 

redesignating paragraphs (c)(8) through 

(14) as paragraphs (c)(9) through (15), 

and adding a new paragraph (c)(8) to 

read as follows: 

§ 24.23 Fees for processing merchandise. 

* * * * * 

(c) * * * 

(8) The ad valorem fee, surcharge, and 

specific fees provided under paragraphs 

(b)(1) and (b)(2)(i) of this section will 

not apply to goods that qualify as 

originating goods under § 203 of the 

United States-Australia Free Trade 

Agreement Implementation Act (see 

also General Note 28, HTSUS) that are 

entered, or withdrawn from warehouse 

for consumption, on or after January 1, 

2005. 

* * * * * 

PART 162—INSPECTION, SEARCH, 

AND SEIZURE 

■ 6. The authority citation for part 162 

continues to read in part as follows: 

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

1592, 1593a, 1624. 

* * * * * 

■ 7. Section 162.0 is amended by 

revising the last sentence to read as 

follows: 

§ 162.0 Scope. 

* * * Additional provisions 

concerning records maintenance and 

examination applicable to U.S. 

importers, exporters and producers 

under the U.S.-Chile Free Trade 

Agreement, the U.S.-Singapore Free 

Trade Agreement, the Dominican 

Republic-Central America-U.S. Free 

Trade Agreement, the U.S.-Australia 

Free Trade Agreement, the U.S.- 

Morocco Free Trade Agreement, the 

U.S.-Peru Trade Promotion Agreement, 

the U.S.-Korea Free Trade Agreement, 

the U.S.-Panama Trade Promotion 

Agreement, and the U.S.-Colombia 

Trade Promotion Agreement are 

contained in Part 10, Subparts H, I, J, L, 

M, Q, R, S and T of this chapter, 

respectively. 

PART 163—RECORDKEEPING 

■ 8. 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. 

* * * * * 

■ 9. Section 163.1 is amended by 

redesignating paragraphs (a)(2)(ix) 

through (xvii) as paragraphs (a)(2)(x) 

through (xviii), and adding a new 

paragraph (a)(2)(ix) to read as follows: 


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7318 Federal Register / Vol. 80, No. 27 / Tuesday, February 10, 2015 / Rules and Regulations 

§ 163.1 Definitions. 

* * * * * 

(a) * * * 

(2) * * * 

(ix) The maintenance of any 

documentation that the importer may 

have in support of a claim for 

preferential tariff treatment under the 

United States-Australia Free Trade 

Agreement (AFTA), including an AFTA 

importer’s supporting statement. 

* * * * * 

■ 10. Appendix to Part 163 is amended 

by adding a listing under section IV in 

numerical order to read as follows: 

Appendix to Part 163—Interim (a)(1)(A) 

List 

* * * * * 

IV. * * * 

§ 10.723–10.727 AFTA records that the 

importer may have in support of an AFTA 

claim for preferential tariff treatment, 

including an importer’s supporting 

statement. 

* * * * * 

PART 178—APPROVAL OF 

INFORMATION COLLECTION 

REQUIREMENTS 

■ 11. The authority citation for part 178 

continues to read as follows: 

Authority: 5 U.S.C. 301; 19 U.S.C. 1624; 44 

U.S.C. 3501 et seq. 

■ 12. Section 178.2 is amended by 

adding new listings for ‘‘§§ 10.723 and 

10.724’’ to the table in numerical order 

to read as follows: 

§ 178.2 Listing of OMB control numbers. 

19 CFR Section Description OMB control 

No. 

*******

§§ 10.723 and 10.724 ............................... Claim for preferential tariff treatment under the US-Australia Free Trade Agreement 1651–0117 

* * * * * * * 

* * * * * 

R. Gil Kerlikowske, 

Commissioner. 

Approved: February 5, 2015. 

Timothy E. Skud, 

Deputy Assistant Secretary of the Treasury. 

[FR Doc. 2015–02720 Filed 2–9–15; 8:45 am] 

BILLING CODE 9111–14–P 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Food and Drug Administration 

21 CFR Part 312 

[Docket No. FDA–2015–D–0268] 

Individual Patient Expanded Access 

Applications: Form FDA 3926; Draft 

Guidance for Industry; Availability 

AGENCY: Food and Drug Administration, 

HHS. 

ACTION: Notice of draft guidance. 

SUMMARY: The Food and Drug 

Administration (FDA or the Agency) is 

announcing the availability of a draft 

guidance for industry entitled 

‘‘Individual Patient Expanded Access 

Applications: Form FDA 3926.’’ The 

draft guidance provides for public 

comment and describes draft Form FDA 

3926 (Individual Patient Expanded 

Access—Investigational New Drug 

Application (IND)), which, when 

finalized, FDA intends to make 

available for licensed physicians to use 

for expanded access requests for 

individual patient INDs. Individual 

patient expanded access allows for the 

use of an investigational drug outside of 

a clinical trial for an individual patient 

who has a serious or immediately lifethreatening disease or condition and 

there is no comparable or satisfactory 

alternative therapy to diagnose, monitor, 

or treat the disease or condition. When 

finalized, draft Form FDA 3926 is 

intended to provide a streamlined 

alternative for submitting an 

Investigational New Drug Application 

(IND) for use in cases of individual 

patient expanded access. 

DATES: February 10, 2015. Although you 

can comment on any guidance at any 

time (see 21 CFR 10.115(g)(5)), to ensure 

that the Agency considers your 

comment on this draft guidance before 

it begins work on the final version of the 

guidance, submit either electronic or 

written comments on the draft guidance 

by April 13, 2015. Submit either 

electronic or written comments 

concerning the collection of information 

proposed in the draft guidance by April 

13, 2015. 

ADDRESSES: Submit written requests for 

single copies of the draft guidance to the 

Division of Drug Information, Center for 

Drug Evaluation and Research, Food 

and Drug Administration, 10001 New 

Hampshire Ave., Hillandale Building, 

4th Floor, Silver Spring, MD 20993, or 

to the Office of Communication, 

Outreach and Development, Center for 

Biologics Evaluation and Research 

(CBER), Food and Drug Administration, 

10903 New Hampshire Ave., Bldg. 71, 

Rm. 3128, Silver Spring, MD 20993– 

0002. Send one self-addressed adhesive 

label to assist that office in processing 

your requests. See the SUPPLEMENTARY

INFORMATION section for electronic 

access to the draft guidance document. 

Submit electronic comments on the 

draft guidance to http://

www.regulations.gov. Submit written 

comments to the Division of Dockets 

Management (HFA–305), Food and Drug 

Administration, 5630 Fishers Lane, Rm. 

1061, Rockville, MD 20852. 

FOR FURTHER INFORMATION CONTACT: Lori 

Bickel, Center for Drug Evaluation and 

Research, Food and Drug 

Administration, 10903 New Hampshire 

Ave., Bldg. 51, Rm. 6353, Silver Spring, 

MD 20993–0002, 301–796–0210; or 

Stephen Ripley, Center for Biologics 

Evaluation and Research, Food and 

Drug Administration, 10903 New 

Hampshire Ave., Bldg. 71, Rm. 7301, 

Silver Spring, MD 20993–0002, 240– 

402–7911. 

SUPPLEMENTARY INFORMATION: 

I. Background 

FDA is announcing the availability of 

a draft guidance for industry entitled 

‘‘Individual Patient Expanded Access 

Applications: Form FDA 3926.’’ The 

draft guidance provides draft Form FDA 

3926 for public comment. When 

finalized, draft Form FDA 3926 will be 

available for licensed physicians to use 

for expanded access requests for 

individual patient INDs as an alternative 

to Form FDA 1571 (Investigation New 

Drug Application (IND)). 

On August 13, 2009, FDA published 

a final rule (74 FR 40900, August 13, 

2009) to amend its IND regulations by 

removing the certain sections of part 

312 (21 CFR part 312) on treatment use 

of investigational drugs and adding 

subpart I of part 312 on expanded access 

(part 312, subpart I). 

Subpart I describes the following 

categories of expanded access: 


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