11464 Federal Register / Vol. 62, No. 48 / Wednesday, March 12, 1997 / Notices

INTERNATIONAL TRADE

COMMISSION

[Investigation No. 332–360]

International Harmonization of

Customs Rules of Origin

AGENCY: United States International

Trade Commission.

ACTION: Request for public comments on

draft proposals for chapters 82–84 and

86–89.

EFFECTIVE DATE: March 5, 1997.

FOR FURTHER INFORMATION CONTACT:

Eugene A. Rosengarden, Director, Office

of Tariff Affairs and Trade Agreements

(O/TA&TA) (202–205–2595), Lawrence

DiRicco—chapters 82–83, 86–89 (202–

205–2606), or Craig Houser—chapter 84

(202–205–2597).

Parties having an interest in particular

products or HTS chapters and desiring

to be included on a mailing list to

receive available documents pertaining

thereto should advise Diane Whitfield

by telephone (202–205–2610) or by mail

at the Commission, 500 E St. SW, Room

404, Washington, D.C. 20436. Hearing

impaired persons are advised that

information on this matter can be

obtained by contacting the

Commission’s TDD terminal on 202–

205–1810. The media should contact

Margaret O’Laughlin in the Office of

External Relations (202–205–1819).

Background:

Following receipt of a letter from the

United States Trade Representative

(USTR) on January 25, 1995, the

Commission instituted Investigation No.

332–360, International Harmonization

of Customs Rules of Origin, under

section 332(g) of the Tariff Act of 1930

(60 FR 19605, April 19, 1995).

The investigation is intended to

provide the basis for Commission

participation in work pertaining to the

Uruguay Round Agreement on Rules of

Origin (ARO), under the General

Agreement on Tariffs and Trade (GATT)

1994 and adopted along with the

Agreement Establishing the World

Trade Organization (WTO).

The ARO is designed to harmonize

and clarify nonpreferential rules of

origin for goods in trade on the basis of

the substantial transformation test;

achieve discipline in the rules’

administration; and provide a

framework for notification, review,

consultation, and dispute settlement.

These harmonized rules are intended to

make country-of-origin determinations

impartial, predictable, transparent,

consistent, and neutral, and to avoid

restrictive or distortive effects on

international trade. The ARO provides

that technical work to those ends will be

undertaken by the Customs Cooperation

Council (CCC) (now informally known

as the World Customs Organization or

WCO), which must report on specified

matters relating to such rules for further

action by parties to the ARO.

Eventually, the WTO Ministerial

Conference is to ‘‘establish the results of

the harmonization work program in an

annex as an integral part’’ of the ARO.

In order to carry out this work, the

ARO called for the establishment of a

Committee on Rules of Origin of the

WTO, and a Technical Committee on

Rules of Origin (TCRO) of the WCO.

These Committees bear the primary

responsibility for developing rules that

achieve the objectives of the ARO.

A major component of the work

program is the harmonization of origin

rules for the purpose of providing more

certainty in the conduct of world trade.

To this end, the agreement contemplates

a 3-year WCO program, which was

formally initiated in July, 1995. Under

the ARO, the TCRO is to undertake (1)

to develop harmonized definitions of

goods considered wholly obtained in

one country, and of minimal processes

or operations deemed not to confer

origin, (2) to consider the use of change

in Harmonized System classification as

a means of reflecting substantial

transformation, and (3) for those

products or sectors where a change of

tariff classification does not allow for

the reflection of substantial

transformation, to develop

supplementary or exclusive origin

criteria based on value, manufacturing

or processing operations or other

standards.

The draft U.S. proposed rules for the

goods of:

Chapter 82—Tools, implements, cutlery,

spoons and forks, of base metal;

parts thereof of base metal

Chapter 83—Miscellaneous articles of

base metal

Chapter 84—Nuclear reactors, boilers,

machinery and mechanical

appliances; parts thereof

Chapter 86—Railway or tramway

locomotives, rolling-stock and parts

thereof; railway or tramway track

fixtures and fittings and parts

thereof; mechanical (including

electro-mechanical) traffic

signalling equipment of all kinds

Chapter 87—Vehicles other than railway

or tramway rolling-stock, and parts

and accessories thereof

Chapter 88—Aircraft, spacecraft, and

parts thereof

Chapter 89—Ships, boats and floating

structures

the Harmonized System that are being

made available for public comment

cover goods that are not considered to

be wholly made in a single country. The

rules rely largely on the change of

heading as a basis for ascribing origin.

Copies of the proposed revised rules

will be available from the Office of the

Secretary at the Commission, from the

Commission’s Internet home page

(http://www.usitc.gov), or by submitting

a request on the Office of Tariff Affairs

and Trade Agreements voice messaging

system (202–205–2592).

These proposals are intended to serve

as the basis for the U.S. proposal to the

TCRO of WCO. The proposals may

undergo change as proposals from other

government administrations and the

private sector are received and

considered. Under the circumstances,

the proposals should not be cited as

authority for the application of current

domestic law.

If eventually adopted by the TCRO for

submission to the Committee on Rules

of Origin of the World Trade

Organization, these proposals would

comprise an important element of the

ARO work program to develop

harmonized, non-preferential country of

origin rules, as discussed in the

Commission’s earlier notice. Thus, in

view of the importance of these rules,

the Commission seeks to ascertain the

views of interested parties concerning

the extent to which the proposed rules

reflect the standard of substantial

transformation provided in the

Agreement.

Forthcoming Commission notices will

advise the public on the progress of the

TCRO’s work and will contain any

harmonized definitions or rules that

have been provisionally or finally

adopted.

Written Submissions

Interested persons are invited to

submit written statements concerning

this phase of the Commission’s

investigation. Written statements should

be submitted as quickly as possible, and

follow-up statements are permitted; but

all statements must be received at the

Commission by close of business on

April 15, 1997, in order to be

considered. Again, the Commission

notes that it is particularly interested in

receiving input from the private sector

on the effects of the various proposed

rules and definitions on U.S. exports as

well as imports.

Commercial or financial information

which a submitter desires the

Commission to treat as confidential

must be submitted on separate sheets of

paper, each marked ‘‘Confidential

Business Information’’ at the top. All

submissions requesting confidential

treatment must conform with the
Federal Register / Vol. 62, No. 48 / Wednesday, March 12, 1997 / Notices 11465

requirements of section 201.6 of the

Commission’s Rules of Practice and

Procedure (19 CFR 201.6). All written

submissions, except for confidential

business information, will be available

for inspection by interested persons. All

submissions should be addressed to the

Office of the Secretary, United States

International Trade Commission, 500 E

Street SW., Washington DC 20436.

By order of the Commission.

Issued: March 6, 1997.

Donna R. Koehnke,

Secretary.

[FR Doc. 97–6191 Filed 3–11–97; 8:45 am]

BILLING CODE 7020–02–P

DEPARTMENT OF JUSTICE

Federal Prison Industries

Product Development and Production:

Public Involvement Procedures

AGENCY: Federal Prison Industries, Inc.,

Bureau of Prisons, Department of

Justice.

ACTION: Notice.

SUMMARY: In this document, Federal

Prison Industries, Inc. (FPI) announces

new interim definitions of three key

terms: New product, specific product,

and significant expansion of an existing

product.

ADDRESSES: Federal Prison Industries,

Inc., 320 First Street, NW., Washington,

DC. 20534.

EFFECTIVE DATE: March 12, 1997.

FOR FURTHER INFORMATION CONTACT: Mr.

Todd Baldau (202) 305–3582.

SUPPLEMENTARY INFORMATION: Last year,

FPI published notices in the Federal

Register and Commerce Business Daily

proposing revisions to the definitions of

‘‘specific product,’’ ‘‘new product’’ and

‘‘significant expansion of production’’

for use with the FPI expansion

guidelines. The Federal Register notice

was printed on August 7, 1996 (61 FR

41248). The Commerce Business Daily

notice was printed on September 20,

1996. Each notice asked interested

parties to review the revised definitions

and submit comments on the proposed

revisions to FPI. FPI received

submissions from the following

individuals and organizations:

U.S. Representative Mac Collins

(Georgia, 3rd District);

The American Defense Preparedness

Association;

The Business and Institutional

Furniture Manufacturers

Association;

Trussbilt, Inc.;

The Coalition for Government

Procurement;

The American Apparel Manufacturers

Association;

Tennessee Apparel Corporation;

Furniture By Thurston; and

The Quarters Furniture Manufacturers

Association.

FPI wishes to thank each of the

respondents for taking the time to

submit their comments. Many of the

submissions included suggestions

which FPI has incorporated into the

revised definitions. Also among the

submissions were several comments

helpful to FPI in understanding

potential implications of the proposed

revised definitions. Some of these

comments led FPI to adjust its original

proposal.

For the purposes of this notice, FPI

has separated all the comments we

received into one of four groups: (1)

Ideas, recommendations or suggestions

FPI has adopted in the revised

definitions; (2) Ideas, recommendations

or suggestions with which FPI

respectfully disagrees and has not

adopted in the revised definitions; (3)

Comments that are more relevant to

other aspects of FPI’s operations, such

as issues concerning mandatory source;

and (4) Comments which are vague,

broad or general in nature. Such

comments do not make a specific point,

making it difficult for FPI to address.

Below is a summary of all comments

received by FPI. In many instances,

similar comments from multiple parties

have been combined. Also included are

some of FPI’s responses, where

appropriate.

(I) Ideas, Recommendations or

Suggestions FPI Has Adopted

The following are ideas,

recommendations or suggestions

provided by commenters which FPI

found useful or constructive, and

incorporated, in whole or in part, into

the revised expansion definitions.

A commenter noted FPI’s initial

announcement stated ‘‘FPI announces

revised definitions of two key terms:

New product and specific product.’’

However, ‘‘significant expansion of

production’’ is also revised. FPI

acknowledges the oversight, and has

reflected this correction in the new

announcement. This notice refers to all

three revised definitions.

Commenters suggested FPI defer

issuing the new definitions, raising the

possibility Congress may require FPI to

modify the terms again, resulting in

another revision in a short period of

time. The commenter stated a delay in

issuing the definitions would permit

interested parties to take up Rep.

McCollum’s offer to discuss FPI’s

operations and regulations next year.

FPI appreciates the willingness to

accept Rep. McCollum’s invitation.

Nonetheless, the current definitions

present a myriad of problems that need

to be addressed. With the commenter’s

suggestion in mind, FPI is publishing

the new definitions as an ‘‘interim

rule.’’ This will allow time for

experience and encourage comments

during its implementation.

A commenter suggested amending the

provision dealing with cases of extreme

public exigency, where FPI would be

empowered with the authority to

increase production without penalty

when asked to do so. The commenter

advised that FPI explicitly state that its

production levels are temporary, and

will not be used as the baseline for

future calculations of what is deemed a

significant expansion of production. FPI

has incorporated such language into the

revised definitions.

Several commenters objected to the

provision allowing FPI to supply new

items of limited duration or volume.

The commenters felt this provision did

not allow for sufficient private industry

input, would be detrimental to small

businesses who sell to the Federal

government and did not provide

adequate safeguards to prevent FPI from

misuse of the provision. FPI recognizes

the concerns raised by the commenters

and has withdrawn the provision from

the revised definition.

Commenters suggested the definitions

should not eliminate an item’s

predominant material of manufacture as

a determinant of whether an item is a

separate specific product. FPI agrees,

and notes the new definitions do not

make such an elimination. Rather, the

predominant material ‘‘will not

ordinarily’’ be a factor in determining

whether an item is a separate specific

product. FPI did not mean to imply the

predominant material of manufacture is

not an important consideration, only

that in most cases, it would not result

in an item being deemed a separate

specific product. An item’s predominant

material will always be considered, and

unless deemed to be significant, will not

typically result in a distinction for a

separate specific product.

A commenter suggested that FPI state

its sales goals in units, not dollars. FPI

appreciates the suggestion and will

attempt to include production

information on units where feasible, as

well as dollars, for impact studies. The

nature of some of FPI’s work makes

stating production goals in units

difficult. It should be noted that in past

impact studies, FPI has attempted to

differentiate between inflation and real