Federal Register / Vol. 66, No. 127 / Monday, July 2, 2001 / Rules and Regulations 34813

B. The last sentence of § 303.16(b)(1)

is amended by adding ‘‘and , with

special instructions for its completion,

by producers who wish to receive the

total annual amount of the duty refund

in installments on a biannual basis’ at

the end of the sentence.

§ 303.16 Definitions and forms.

(a) * * *

(9) * * * Excluded, however, are

wages paid for outside consultants or

other professional personnel, such as

lawyers and accountants, or those

persons not involved in the day-to-day

assembly operations or servicing and

maintenance of equipment and fixtures

necessary for the assembly or

manufacturing operations or the

administrative work and security

activities directly related to the

operations of the company, such as

gardeners or construction workers, plus

any wages paid for the assembly of

dutiable jewelry or for the repair of

dutiable jewelry to the extent that such

wages exceed the percentage set forth

above. No more than two insular

producers may have their wages

credited for their portion of the wages

paid for work on a single piece of

jewelry which entered the U.S. free of

duty under the program. Wages paid by

the two producers will be credited

proportionally provided both producers

demonstrate to the satisfaction of the

Secretaries that they worked on the

same piece of jewelry, the jewelry

received duty-free treatment into the

U.S., and the producers maintained

production and payroll records

sufficient for the Departments’

verification of the creditable wage

portion (see § 303.17(b)).* * *

* * * * *

§ 303.17 [Amended]

5. Section 303.17(b)(4) is amended by

adding ’’, or the certificate of origin for

the shipment, or, if a company did not

receive such documents from Customs,

a certification from the consignee that

the jewelry shipment received duty-free

treatment, or a certification from the

producer, if the producer can attest that

the jewelry shipment received duty-free

treatment’’ at the end of the paragraph.

6. Section 303.19(a)(1) is revised to

read as follows:

§ 303.19 Issuance and use of production

incentive certificates.

(a) Issuance of certificates. (1) The

total annual amount of the Certificate of

Entitlement, Form ITA–360, may be

divided and issued on a biannual basis.

The first portion of the total annual

certificate amount will be based on

reported duty-free shipments and

creditable wages paid during the first

six month of the calendar year, using

the formula in § 303.20(b). The

Departments require the receipt of the

data by July 31 for each producer who

wishes to receive an interim duty refund

certificate. The interim duty refund

certificate will be issued on or before

August 31 of the same year in which the

wages were earned unless the

Departments have unresolved questions.

The process of determining the total

annual amount of the duty refund will

remain the same. The completed annual

application (Form ITA–334P) shall be

received by the Departments on or

before January 31 and the annual

verification of data and calculation of

each producer’s total annual duty

refund, based on the verified data, will

continue to take place in February. Once

the calculations for each producer’s

duty refund has been completed, the

portion of the duty refund that has

already been issued to each producer

will be deducted from the total amount

of each producer’s annual duty refund

amount. The duty refund certificate will

continue to be issued by March 1 unless

the Departments have unresolved

questions.

* * * * *

Richard W. Moreland,

Acting Assistant Secretary for Import

Administration, Department of Commerce.

Nikolao Pula,

Acting Director, Office of Insular Affairs,

Department of the Interior.

[FR Doc. 01–16599 Filed 6–29–01; 8:45 am]

BILLING CODE 3510–DS–P; 4310–93–P

DEPARTMENT OF THE TREASURY

Customs Service

19 CFR Part 24

[T.D. 01–46]

RIN 1515–AC64

Time Limitation for Requesting

Refunds of Harbor Maintenance Fees

AGENCY: Customs Service, Department

of the Treasury.

ACTION: Final rule.

SUMMARY: This document amends the

Customs Regulations to establish a one

year time limit within which a refund

request must be filed for overpayments

of Harbor Maintenance Fees that were

paid on a quarterly basis. The time limit

will provide an efficient and reasonable

final resolution of claims against

Customs, including claims for refunds

of export harbor maintenance fees that

were held unconstitutional by the

United States Supreme Court in 1998.

Refund requests for harbor maintenance

fee payments that are more than a year

old must be filed by the effective date

of this document.

EFFECTIVE DATE: December 31, 2001.

FOR FURTHER INFORMATION CONTACT:

Deborah Thompson, Revenue Branch,

National Finance Center (317) 298–1200

(ext. 4003).

SUPPLEMENTARY INFORMATION:

Background

The Harbor Maintenance Fee was

created by the Water Resources

Development Act of 1986 (Pub. L. 99–

622; codified at 26 U.S.C. 4461 et seq.)

(the Act) and is implemented by § 24.24

of the Customs Regulations (19 CFR

24.24). Pursuant to the Act, the harbor

maintenance fee became effective on

April 1, 1987.

Imposition of the fee is intended to

require those who benefit from the

maintenance of U.S. ports and harbors

to share in the cost of that maintenance.

The fee has been assessed on port use

associated with imports, exports,

imported merchandise admitted into a

foreign trade zone, passengers, and

movements of cargo between domestic

ports. Since April of 1998, based on the

U.S. Supreme Court’s decision that

harbor maintenance fees applied to

exports of merchandise are

unconstitutional (United States Shoe

Corporation v. United States, 118 S. Ct.

1290, No. 97–372 (March 31, 1998)),

Customs has not collected export harbor

maintenance fees. Currently, except for

export shipments, the fee is assessed

based on 0.125 percent of the value of

commercial cargo loaded or unloaded at

certain identified ports or, in the case of

passengers, on the value of the actual

charge paid for the transportation.

Notice of Proposed Rulemaking

Published on December 15, 2000

On December 15, 2000, Customs

published a notice of proposed

rulemaking (NPRM) in the Federal

Register (65 FR 78430) proposing to

amend § 24.24(e)(4) of the Customs

Regulations (19 CFR 24.24(e)) to require

the filing of a refund request for harbor

maintenance fees paid on a quarterly

basis within one year of the date of

payment of the fee, except for fees paid

relative to imported merchandise

admitted into a foreign trade zone and

subsequently withdrawn from the zone

under 19 U.S.C. 1309, for which the

refund request would have to be filed

within one year of the date of

withdrawal. The NPRM also proposed

to amend § 24.73 of the Customs

34814 Federal Register / Vol. 66, No. 127 / Monday, July 2, 2001 / Rules and Regulations

Regulations (19 CFR 24.73) to require

the filing of general claims against

Customs—those not otherwise provided

for under the Customs laws—within one

year of the act giving rise to the claim.

The NPRM sets forth the bases for

proposing these time limits, including

the Court of Appeals for the Federal

Circuit’s (CAFC) acknowledgement of

Customs authority to impose a time

limit on the filing of harbor

maintenance fee refund requests

(Swisher International, Inc. v. United

States, 205 F. 3d 1358 (No. 99–1277

C.A.F.C. February 28, 2000), cert.

denied). (In Swisher, the court held

Customs denial of a request for a refund

of export harbor maintenance fee

payments to be a protestable decision

under 19 U.S.C. 1514.)

The notice pointed out that for harbor

maintenance fee payments that are more

than a year old, a refund request would

be required to be received by Customs

prior to the effective date of the final

rule adopting the proposal.

Interim Regulation Published on March

28, 2001

On March 28, 2001, Customs

published an interim regulation in the

Federal Register (66 FR 16854)

(hereafter, Interim Regulation)

amending § 24.24(e)(4) of the Customs

Regulations, the same section of the

regulations amended in this final rule

document. The Interim Regulation,

effective on the date of publication,

amended the regulations to provide a

new procedure for requesting refunds of

export harbor maintenance fees. (On

April 27, 2001, a correction to the

Interim Regulation was published in the

Federal Register (66 FR 21086).)

The main features of the new

procedure are that: (1) Most refund

requests (those covering payments made

on and after July 1, 1990) can be filed

and processed without supporting

documentation; and (2) exporters filing

refund requests that require supporting

documentation (covering payments

made prior to July 1, 1990) will have an

additional 120 days to submit

documents or additional documents

from the date Customs initially denies a

request for lack of or insufficient

documentation.

This final rule document incorporates

the procedure set forth in the Interim

Regulation. It is noted that pursuant to

Customs consideration of the comments

received in response to the NPRM (see

discussion below), the effective date of

the one year time limitation is 180 days

from its date of publication in the

Federal Register. This differs from the

Interim Regulation’s background

discussion where it is stated that the

effective date of the time limitation

would be 30 days from date of

publication.

Discussion of Comments

Customs received 21 comments in

response to the NPRM. The comments

can be divided into five subject

categories: (1) The proposed one-year

filing requirement as applied to requests

for refunds of export harbor

maintenance fee payments made more

than one year ago; (2) the applicability

of the Regulatory Flexibility Act (5

U.S.C. 603 and 604) to the proposed

amendment’s one-year filing

requirement as applied to export fee

refund requests; (3) the documentary

requirements; (4) the applicability of

interest to refunds of export fees; and (5)

requests for a public hearing/meeting.

Most of the comments were provided

on behalf of exporters concerned about

filing requests for refunds of export

harbor maintenance fees that were held

unconstitutional in 1998 and are no

longer required under the Customs

Regulations. These exporters have a

keen interest in Customs procedure for

issuing refunds of these fees. The

Interim Regulation’s procedure for

obtaining refunds of these fees

addresses and, Customs believes,

resolves satisfactorily the issues raised

by the comments, as discussed below.

Comments concerning the proposed

amendment of § 24.73 to impose a one

year filing requirement relative to

general claims against Customs are not

discussed in this document, as Customs

has decided to delay proceeding with

that proposed amendment.

The One-Year Filing Requirement as

Applied to Requests for Refunds of

Export Fee Payments

Comment: Eighteen of the 21

commenters objected to the proposed

amendment’s one-year filing

requirement for refund requests of

quarterly-paid harbor maintenance fees.

Some commenters objected to

imposition of any time limit, while most

others objected to how Customs would

apply the time limit to refund requests

covering payments made more than one

year ago.

The various formulations of this

objection can be summarized as a

complaint that the time limit as applied

to payments that are more than one year

old—which includes all export harbor

maintenance fee payments—does not

provide exporters enough time to file

claims, and to the extent that lack of

time results in exporters being unable to

file refund requests, it is unreasonable

and unfair. At least one commenter

pointed out how some exporters might

have to review up to ten or eleven years

of payments to Customs dating back to

1987, a formidible task, especially when

records that old are often stored off-site.

Many companies routinely and

reasonably destroy records that old. One

commenter contended that many

companies have not been dilatory, but

genuinely lack the resources necessary

to stay on top of this matter. Some

companies have been waiting for

litigation to be resolved and then for

Customs to issue instructions for a

refund filing procedure. These

companies, say the commenters, will

need more time to prepare their requests

for refund than the proposed time limit

allows.

Some commenters characterized this

provision as a time limit that

retroactively cuts off rightful claims

contrary to the spirit and language of the

Swisher decision. For this reason, some

raised due process objections. Some

raised equal protection objections on the

grounds that equally situated exporters

will be treated differently where some

are able to file their claims timely (and

are issued refunds) while others are not

(and are not issued refunds). All of these

commenters feel strongly that the fact

that the export fees at issue were

unconstitutional and thus wrongly

collected weighs in favor of Customs

exercise of leniency regarding a time

limit. Some stated that for this reason

(unconstitutionality/wrongful

collection), Customs should be assisting

exporters to obtain refunds, not

impeding them.

Many commenters believe that

requiring refund requests for payments

made more than a year ago by the

effective date of the final rule would not

be workable and would not be fair.

(These comments indicate that most

commenters contemplated a short

period of delay between the publication

date and the effective date. The usual

delay period is 30 days. At least two

commenters contemplated that the

effective date would be the date of

publication.) Some commenters

suggested that this short deadline will

result in a flood of claims that will be

an inconvenience and distraction for

Customs, will require much time to

process, and will result in a ‘‘hurry up

and wait’’ situation.

At least one commenter suggested that

the effective date of the final rule should

be delayed 60 days. Some commenters

stated that there should not be a

deadline for payments ruled

unconstitutional. At least seven

commenters recommended that, as

applied to payments older than one

year, filers should have one full year

from the date of publication of the final

Federal Register / Vol. 66, No. 127 / Monday, July 2, 2001 / Rules and Regulations 34815

rule to file refund requests. Another

commenter recommended that exporters

should have eighteen months from the

date of publication to file refund

requests.

Customs response: Customs believes

that a one year filing requirement is

reasonable. Customs statutory and

regulatory provisions that impose time

limits generally do not provide more

than a year to take whatever action is

required under the provision. In fact,

similar or shorter time limits exist in

other contexts, such as the requirement

to file a protest under 19 U.S.C. 1514

within 90 days of a Customs decision

regarding the amount of duties

chargeable, the amount of a charge or

exaction, or the liquidation of an entry.

The protest procedure is the basic

procedure for challenging a variety of

Customs decisions and obtaining a

refund of overpaid duties or charges. It

is noteworthy that the applicable

Customs law grants no more than 90

days to take this important action. The

requirement to file a petition for

reliquidation to correct a clerical error

under 19 U.S.C. 1520(c)(1) within one

year of the date of liquidation is another

example. A third example is the one

year filing requirement of 19 U.S.C.

1520(d) imposed on requests for

reliquidation of an entry involving

goods qualifying under NAFTA rules of

origin. The matter of requesting a refund

of overpaid harbor maintenance fees is

no more important than the matters

these provisions address.

Generally, the process of obtaining

refunds of harbor maintenance fees is

well served by allowing up to one year

to file the request/claim. It balances

Customs legitimate need for efficient

and final resolution of claims with the

legitimate interest of exporters seeking

to reclaim fees that should not have

been paid or were paid in excess of

what was due. Moreover, the CAFC in

Swisher explicitly stated that Customs

is ‘‘free to alter the regulation to impose

a time limit.’’ Thus, in imposing this

one year time limit, Customs is simply

acting on the Court’s suggestion, in

addition to seeking to bring more order

and reasonable finality to the refund

procedure.

Regarding application of the time

limit to export fee payments (or other

quarterly harbor maintenance fee

payments) that were made more than a

year ago (as is the case with all export

fee payments), Customs does not agree

with the contention that it is unfair and

unreasonable to require filing of the

refund request by the effective date of

the final rule.

The notion that exporters will be

confined to only a short period between

publication of the final rule and its

effective date to file refund requests is

simply inaccurate. Customs notes that

the regulation authorizing a refund

request was promulgated in 1991. Thus,

exporters have had 10 years to file

refund requests. As far back as 1995

when the fee as applied to exports was

initially found to be unconstitutional by

the U.S. Court of International Trade

(CIT) in U.S. Shoe Corp. v. United

States, 19 CIT 1284, 907 F. Supp. 408

(CIT 1995), exporters were on notice of

their ability to recover these fees. That

was six years ago. The regulation

authorizing refund requests had been

effective for four years by that time.

While the U.S. Shoe case was appealed

and was not affirmed by the Supreme

Court until its 1998 decision, exporters

who paid export fees were on notice

during that three year period that they

may be entitled to a refund. Nothing

prevented exporters from filing refund

requests under the existing regulations

at any time during that period and many

exporters did so. Neither were exporters

precluded from filing refund requests

during the period following the

Supreme Court’s conclusive ruling in

1998, and many did so.

Since February of 2000, when the

court in Swisher stated that it had

jurisdiction to review a refund request

denial if properly protested within 90

days of the denial, over 130 exporters

followed these procedures, making it

clear that they were available to all

exporters. In December of 2000, the

NPRM gave exporters notice regarding

the proposed change to the Customs

regulations to impose a one year time

limit within which to file a refund

request. This was the fourth in a series

of public actions (by the courts and

Customs) over a five year period that

served as notice to exporters that

refunds of export harbor maintenance

fees were obtainable. By the time the

NPRM’s proposed amendment is

published as a final rule, exporters will

have had another four to five months

since publication of the NPRM to file

timely refund requests.

Nevertheless, while Customs believes

that requiring the filing of export fee

refund requests by the effective date of

the final rule is not unfair or

unreasonable, Customs acknowledges

the validity of sentiments expressed by

those commenters who believe that

more time to file refund requests

furthers the interest held by those who

have not yet requested refunds on fees

paid more than a year ago. Customs

intent at the time it issued the NPRM

and, indeed, at the time it issued the

Interim Regulation (regarding the

amended procedure for filing refund

requests) was to make the one year time

limitation effective on the usual

effective date of a final rule, 30 days

from the date of its publication in the

Federal Register. Based on the

commenters’ concerns, Customs is

delaying the effective date of this final

rule document to the date that is 180

days after publication. This extends by

150 days the time within which refund

requests for export fees (and other

quarterly harbor maintenance fees) paid

over a year ago can be filed, as

compared to the 30 day effective period

contemplated by Customs at the time

the NPRM was published and as set

forth in the background discussion of

the Interim Regulation.

With a delayed effective date of 180

days, exporters will have had

approximately 12 months from the date

of publication of the NPRM to file

refund requests. As of the date of

publication of this final rule document,

over 2000 exporters have already filed

refund requests since publication of the

NPRM.

Given all of the above considerations,

including the extended delayed

effective date, Customs believes that

exporters have had, and still have,

ample time to file a refund request.

In regard to comments that the

proposed amendment’s time limit is

retroactive, particularly with respect to

payments made more than a year ago,

Customs notes that an NPRM, by its

very nature, is prospective, not

retroactive. The amendments it

proposes will become effective only

upon later publication of a final rule

which itself will become efffective

prospectively (usually not until at least

30 days after its publication but, as

above, 180 days for this final rule

document). Customs therefore disagrees

that the time limit at issue is retroactive.

The fact that it does not retroactively cut

off claims is evidenced by the more than

2000 exporters who have filed refund

requests since the NPRM was published

and by the additional numbers of

exporters who surely will file timely

refund requests after publication of this

final rule document.

As for the comment that some

exporters were waiting to see events

transpire before filing a refund request,

Customs again notes that the procedure

for filing refund requests has been

provided for under the Customs

Regulations for a decade. Any of these

exporters could have filed refund

requests at any time. Exporters who

waited may have done so at their own

peril, but they still will have time to file

a timely refund request. Again, this final

rule is not effective until 180 days after

publication, and the procedure set forth

34816 Federal Register / Vol. 66, No. 127 / Monday, July 2, 2001 / Rules and Regulations

in the Interim Regulation is less

burdensome than the procedure it

replaced. The procedure set forth in the

Interim Regulation provides a simpler

process and more time to perfect a

refund request than was made apparent

in the NPRM. It provides that exporters

filing for refunds of payments made on

or after July 1, 1990, need only file a

letter of request containing certain

information, and those who are required

to submit supporting documentation

(proof of payment) with their requests

for refund (relative to payments made

prior to July 1, 1990) will have an

additional 120-day period to file

additional documentation if a timely

filed request is denied for lack of or

insufficient documentation.

Based on the foregoing, Customs

believes that the time limit as applied to

payments made more than a year ago, as

set forth in this final rule document, is

fair, reasonable, and eminently capable

of being complied with under the

amended refund request procedure.

Customs believes that the time limit

makes the refund regulation more

consistent with other Customs laws and

regulations governing refunds, while

still affording quarterly payors ample

opportunity to file refund requests. In

imposing this time limit that brings

more order, efficiency, and measured

finality to the process, Customs believes

it is acting reasonably and responsibly

in furtherance of its mission to

administer the law.

Comments Regarding Applicability of

the Regulatory Flexibility Act

Comment: Three commenters asserted

that the one-year filing requirement as

proposed in the NPRM will have a

significant impact on small business

entities whose rightful claims may be

cut off by the short deadline (relative to

payments made more than a year ago).

These commenters thus contended that

Customs must perform an analysis

under the Regulatory Flexibility Act

(RFA).

Customs response: The RFA (or Act)

requires that an agency perform an

analysis when that agency’s regulatory

action will have a significant economic

impact on a substantial number of small

entities. Customs does not believe that

its action (in amending the regulations

to impose a one year filing requirement

and require, for payments that are more

than one year old, the filing of requests

by the effective date of this final rule

document) will produce an impact that

falls within the purview of the Act.

More specifically, Customs believes that

the potential impact complained of

(failure to file a timely refund request by

the effective date of this final rule) will

not result from its action but from the

inaction of exporters or others eligible to

file for refunds.

The potential impact complained of is

capable of being avoided without

significant inconvenience or difficulty.

There is no reason why an exporter

should be unable to file a refund request

by what Customs believes is a

reasonable deadline. Numerous refund

requests have been filed already since

publication of the NPRM on December

15, 2000, and many were filed even

before the NPRM’s publication. By the

effective date of this final rule, exporters

will have had at least twelve months to

file a request for a refund since

publication of the NPRM. This period is

in addition to the one year exporters

have had to file refund requests since

the CAFC’s decision in Swisher in

February of 2000, the three years

exporters have had to file requests since

the Supreme Court’s 1998 decision in

U.S. Shoe, and the six years they have

had to file requests since the initial

holding of unconstitutionality by the

CIT in its 1995 U.S. Shoe decision.

Moreover, an exporter wishing to

secure its claim under the instant time

limit and the Interim Regulation’s

procedure need only file a letter of

request prior to the effective date of this

final rule, as prescribed under the

Interim Regulation. Supporting

documentation will not be required in

most cases, and where it is required (for

payments made prior to July 1, 1990),

exporters will have an additional 120

days to produce that documentation

after an initial claim is denied for lack

of or insufficient documentation. For

these reasons, Customs believes that an

impact of the kind that triggers an

analysis under the RFA will not result

from its action in imposing the

regulatory filing requirement at issue.

Comments Concerning Documentary

Requirements

Comment: Many commenters objected

to the requirement in the NPRM that a

CF 349 be filed with requests for

refunds. These commenters pointed out

that Customs accepted other documents

with fee payments before the regulations

required use of the CF 349 sometime in

1991. Some stated that Customs

accepted payments and issued refunds

without CF 349s even after 1991.

According to these commenters, these

other documents include the Vessel

Export Summary Sheet (with payment),

cancelled checks (as proof of payment),

and other documents (for both

purposes) from time to time. These

commenters urge Customs to amend the

regulation to permit alternative

documentation that reasonably

establishes payment of the fee.

One commenter recommended that

Customs allow submission of

reconstructed CF 349s. Many

commenters stated that Customs should

not make a determination on any refund

request where the exporter has a FOIA

request pending. Some suggested that

the amended regulation should provide

that an exporter can file a refund request

within 60 days (or some other period of

time) after its receipt of a FOIA

response. Other commenters

recommended that Customs delay a

refund determination on a timely filed

refund request until the exporter

receives a response to the FOIA request

and is given time to supplement the

refund request with the documentation

received.

Customs response: These comments

were received before the Interim

Regulation was published simplifying

the procedure for filing refund requests.

The Interim Regulation was published

because Customs agrees with the general

tenor of these comments that there

should exist a more expeditious and

streamlined procedure for requesting an

export harbor maintenance fee refund

and because Customs understands the

difficulty some exporters face in

providing supporting documentation

with the refund request. Under the

Interim Regulation, an exporter

requesting a refund of export fees need

not provide supporting documentation,

such as the CF 349 or the Export Vessel

Movement Summary Sheet, for any

quarter from July 1990 forward (through

April of 1998 when collection of export

fees ceased). Customs has relieved these

exporters from this burden because

Customs has retained documentation

relative to payments made during this

period. Since Customs possesses this

documentation, exporters need not file

it.

In doing this (relieving exporters from

the documentary requirement), Customs

removed the 10-year-old regulatory

requirement that refund requests

include supporting documentation.

Under the Interim Regulation

procedure, if there is a dispute as to any

quarter from July 1990 forward, the

exporter must then submit supporting

documentation for Customs review and

consideration. This new procedure

effectively addresses the concerns

exporters raised about FOIA requests, as

it eliminates any need to obtain

supporting documentation through a

FOIA request for payments made after

July of 1990. Documents that might be

obtained through a FOIA request are not

necessary to obtain a refund. Customs

will apply the new procedure to all

Federal Register / Vol. 66, No. 127 / Monday, July 2, 2001 / Rules and Regulations 34817

previously filed refund requests

regardless of whether they included

supporting documentation.

With regard to the quarters preceding

July of 1990, the Interim Regulation did

not amend the 10-year-old refund

request procedure because Customs has

not retained copies of supporting

documentation for payments made

during this period. Thus, exporters must

submit supporting documentation with

refund requests for any quarter

preceding July of 1990. The fact that

Customs does not possess pre-July 1990

documentation effectively eliminates

any legitimate reason to link a FOIA

request with a refund request; that is,

since Customs does not possess and

cannot provide copies of the supporting

documentation requested, a FOIA

request would be fruitless.

Regarding the points made by some

commenters concerning the documents,

Customs acknowledges that the CF 349

was not required until 1991. Prior to use

of the CF 349, Customs required a

certified Export Vessel Movement

Summary Sheet or, if the exporter filed

automated summary monthly Shippers

Export Declarations, a letter containing

the following information: The

exporter’s identification, its EIN, the

appropriate Census Bureau reporting

symbol, and the quarter involved. Since

the Interim Regulation continues to

provide that copies of supporting

documentation must accompany refund

requests for quarters preceding July of

1990, failure to submit this

documentation will result in the denial

of the refund request. However, under

the Interim Regulation’s procedure, an

exporter, whose refund request

(covering pre-July 1, 1990, payments) is

denied for lack of or insufficient

documentation, will have an additional

120 days from the date of denial to

submit documentation or additional

documentation to support its claim.

Again, Customs believes that the

procedure provided for in the Interim

Regulation addresses and resolves the

commenters concerns regarding

documentation requirements and FOIA

requests.

Comments Regarding Payment of

Interest on Export Harbor Maintenance

Fee Refunds

Comment: Three commenters urged

Customs to apply interest to export

harbor maintenance fee refunds. One

commenter stated that the court in

Swisher ordered that Customs pay

interest on refunds issued under the

court-imposed procedure (applicable to

only those who filed complaints with

the court). This commenter contended

that Customs administrative procedure

should be consistent with the court’s

intentions and provide for the payment

of interest.

Customs response: Customs disagrees

with the commenters who called for the

payment of interest on administrative

refunds of export harbor maintenance

fee payments. The CAFC ruled in

International Business Machines Corp.

v. United States, 205 F. 3d 1367 (Fed.

Cir. 2000) (hereafter, IBM), a test case

designated to resolve all export fee

interest issues, that exporters are not

entitled to interest on the refund of

these fees. The court opined that there

is no statutory waiver of sovereign

immunity which would allow the

United States to pay interest on

adminstrative refunds. IBM attempted to

appeal this ruling to the United States

Supreme Court, but the Supreme Court

refused to hear the case (IBM v. United

States, cert. denied, 69 U.S.L.W. 3259

(Feb. 20, 2001)).

In the meantime, several exporters

have filed lawsuits in the CIT arguing

that interest should be paid on

adminstrative refunds of export fees on

grounds they claim were not considered

by the CAFC in IBM. Unless there is a

final ruling awarding interest in these

lawsuits, or in any test case designated

by the CIT to resolve this issue, Customs

will abide by the ruling in IBM that bars

the payment of interest on adminstrative

refunds of export fees.

In addition, it should be noted that, as

in Swisher, post-judgment interest is

paid in lawsuits where a request for

export fee refunds was denied by

Customs, a protest was filed and denied,

and a lawsuit was commenced under 28

U.S.C. 1581(a). However, this payment

of post-judgment interest, which is

statutorily mandated, does not apply to

adminstrative refunds of export fees.

Comment: Six commenters stated that

Customs should hold a public hearing

or meeting on the proposed amendment.

These commenters alleged that the short

deadline for filing refund requests for

payments that are more than a year old

will have a significant and harmful

impact on small business entities. Thus,

a public meeting or hearing would be

appropriate to consider applicability of

the provisions of the RFA and to discuss

the time limit proposed and its effect on

the capability of exporters to meet the

deadline and submit required

documentation.

Customs response: Customs believes

that a public hearing or meeting is not

necessary because the issues raised in

the comments as reasons for the meeting

have been addressed and resolved by

Customs since publication of the NPRM.

More specifically, Customs believes that

the following provisions, which were

not included in the NPRM, will

satisfactorily resolve the commenters’

concerns: (1) This final rule document’s

delayed effective date, which will

extend the date by which refund

requests for payments made more than

a year ago must be filed to 180 days

from the date of publication in the

Federal Register (as opposed to 30 days

after publication, as indicated in the

Interim Regulation); (2) the Interim

Regulation’s provision that exporters

need not file supporting documentation

with refund requests for payments made

on and after July 1, 1990; and (3) the

Interim Regulation’s provision of an

additional 120 days for filing supporting

documentation where supporting

documentation is required.

As these provisions change the

circumstances contemplated by the

commenters who suggested a public

meeting, and since Customs believes

they put to rest the commenters’

concerns, Customs believes that a public

meeting is not necessary.

Conclusion

After analysis of the comments and

further review and consideration of the

matter, Customs has determined to

adopt as final the amendment proposed

in the NPRM published in the Federal

Register (65 FR 78430) on December 15,

2000, setting forth in § 24.24(e)(4) the

one year time limitation on requesting

refunds of quarterly-paid harbor

maintenance fees. It is noted that

because Customs has issued the Interim

Regulation that amended § 24.24(e)(4) to

simplify the procedures for requesting

refunds of export harbor maintenance

fees, after publication of the NPRM, the

structure of § 24.24(e)(4) is revised from

how it is set forth in the NPRM to reflect

the substance of the Interim Regulation.

Customs notes that the text of the

amended regulation does not explicitly

set forth that refund requests for export

fee payments that were made more than

a year ago must be filed by the effective

date of this final rule document. It only

sets forth the one-year-from-payment

filing requirement (with the

aforementioned exception for foreign

trade zone withdrawals). Customs

therefore emphasizes that export fee

refund requests for payments made

more than a year ago that are not filed

on or before the effective date of this

final rule will be rejected as untimely.

After a reasonable time, the regulation

will be amended to delete the provision

concerning refunds of export harbor

maintenance fees, as these fees are no

longer collected by Customs (and

haven’t been since April of 1998).

Regarding the other proposed changes

in the NPRM, the technical change

34818 Federal Register / Vol. 66, No. 127 / Monday, July 2, 2001 / Rules and Regulations

proposed to § 24.24(e)(2)(ii) is adopted

as proposed. As mentioned in the

comment discussion, Customs has

determined not to proceed at this time

with the proposed amendment to

§ 24.73 imposing a one year filing

requirement on general claims.

Paperwork Reduction Act

The collection of information

contained in this regulation has

previously been reviewed and approved

by the Office of Management and

Budget (OMB) under OMB control

number 1515–0158. This rule does not

include any changes to the existing

approved information collection.

Regulatory Flexibility Act

Insofar as this amendment to the

regulations merely adds a reasonable

time limit within which to file for an

already provided for Customs procedure

under an existing regulation, pursuant

to the provisions of the Regulatory

Flexibility Act (5 U.S.C. 601 et seq.), it

is certified that this amendment will not

have a significant economic impact on

a substantial number of small entities.

Accordingly, the amendment is not

subject to the regulatory analysis or

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

604.

Executive Order 12866

This document does not meet the

criteria for a ‘‘significant regulatory

action’’ as specified in E.O. 12866.

Drafting Information

The principal author of this document

was Bill Conrad, Office of Regulations

and Rulings, U.S. Customs Service.

However, personnel from other offices

contributed in its development.

List of Subjects in 19 CFR Part 24

Accounting, Claims, Customs duties

and inspection, Fees, Financial and

accounting procedures, Harbors,

Imports, Reporting and recordkeeping

requirements, Taxes, User fees.

Amendments to the Regulations

For the reasons stated in the

preamble, Part 24 of the Customs

Regulations (19 CFR Part 24) is

amended as follows:

PART 24—CUSTOMS FINANCIAL AND

ACCOUNTING PROCEDURE

1. The authority citation for part 24

continues to read in part as follows:

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

66, 1202 (General Note 22, Harmonized Tariff

Schedule of the United States), 1505, 1624;

26 U.S.C. 4461, 4462; 31 U.S.C. 9701.

* * * * *

2. Section 24.24 is amended by

revising the heading of paragraph (e),

removing in paragraph (e)(2)(ii) the

reference to ‘‘(e)(3)(iii)’’ and adding in

its place ‘‘(e)(2)(iii)’’, and revising

paragraph (e)(4) to read as follows:

§ 24.24 Harbor maintenance fee.

* * * * *

(e) Collections, supplemental

payments, and refunds— ***

(4) Refunds and supplemental

payments—(i) General. To make

supplemental payments or seek refunds

of harbor maintenance fees paid relative

to the unloading of imported cargo, the

procedures applicable to supplemental

payments or refunds of ordinary duties

must be followed. To seek refunds of

quarterly-paid harbor maintenance fees

pertaining to export movements, the

procedures set forth in paragraph

(e)(4)(iv) of this section must be

followed. To make supplemental

payments on any quarterly-paid harbor

maintenance fee or seek refunds of

quarterly-paid harbor maintenance fees

pertaining to other than export

movements, the procedures set forth in

paragraph (e)(4)(iii) must be followed.

The address to mail supplemental

payments of quarterly-paid harbor

maintenance fees is: U.S. Customs

Service, P.O. Box 70915, Chicago,

Illinois 60673–0915. The address to

mail requests for refunds of quarterlypaid harbor maintenance fees is: U.S.

Customs Service, HMT Refunds, 6026

Lakeside Blvd., Indianapolis, IN, 46278.

(ii) Time limit for refund requests. A

refund request must be received by

Customs within one year of the date the

fee for which the refund is sought was

paid to Customs or, in the case of fees

paid relative to imported merchandise

admitted into a foreign trade zone and

subsequently withdrawn from the zone

under 19 U.S.C. 1309, within one year

of the date of withdrawal from the zone.

(iii) For fees paid on other than export

movements. If a supplemental payment

is made for any quarterly-paid harbor

maintenance fee or a refund is requested

relative to quarterly fee payments

previously made regarding the loading

or unloading of domestic cargo, the

unloading of cargo destined for

admission into a foreign trade zone, or

the boarding or disembarking of

passengers, the refund request or

supplemental payment must be

accompanied by a Harbor Maintenance

Fee Amended Quarterly Summary

Report, Customs Form 350, along with

a copy of the Harbor Maintenance Fee

Quarterly Summary Report, Customs

Form 349, for the quarter(s) covering the

payment to which the refund request or

supplemental payment relates. A

request for a refund must specify the

grounds for the refund.

(iv) For fees paid on export

movements. Customs will process

refund requests relative to fee payments

previously made regarding the loading

of cargo for export as follows:

(A) For export fee payments made

prior to July 1, 1990, the exporter (the

name that appears on the SED or

equivalent documentation authorized

under 15 CFR 30.39(b)) or its agent must

submit a letter of request for a refund

specifying the grounds for the refund

and identifying the specific payments

made. The letter must be accompanied

by proof of payment then required

under the regulations relative to each

payment claimed. Proof of payment can

be either a copy of the Export Vessel

Movement Summary Sheet or, where an

Automated Summary Monthly

Shipper’s Export Declaration was filed,

a letter containing the exporter’s

identification, its employer

identification number (EIN), the Census

Bureau reporting symbol, and the

quarter for which the payment was

made. Upon receiving a letter of request

for a refund, Customs will evaluate the

supporting documentation submitted

and issue the refund to the exporter or

its agent if warranted. If the request

lacks documentation or the

documentation submitted is

insufficient, the exporter’s refund

request will be denied, in which case

the exporter will have an additional 120

days from the date of denial to submit

documentation or additional

documentation. If the documentation

submitted during the 120 day period is

insufficient, Customs will deny the

request.

(B) For export fee payments made on

or after July 1, 1990, the exporter or its

agent must submit a letter of request for

a refund specifying the grounds for the

refund, identifying the quarters for

which a refund is sought, and

containing the following additional

information: The exporter’s name,

address, and employer identification

number (EIN); the name and EIN of any

freight forwarder or other agent that

made export fee payments on the

exporter’s behalf; and a name, telephone

number, and facsimile number of a

contact person. If a refund request is

filed by a freight forwarder or other

agent on the exporter’s behalf, the

request must include a properly

executed power of attorney and/or a

letter signed by the exporter authorizing

the representation. Refund requests for

payments made on or after July 1, 1990,

need not be accompanied by supporting

documentation. Upon receipt of the

letter of request, Customs will search its

Federal Register / Vol. 66, No. 127 / Monday, July 2, 2001 / Rules and Regulations 34819

records for export fee payments made by

or on behalf of the requesting exporter

during the quarters identified in the

letter of request. Customs will then mail

to the exporter or its agent a ‘‘Harbor

Maintenance Fee Refund Report and

Certification’’ (Report/Certification)

containing the results of the search and

a statement of the amount of refunds

owed to the exporter, if any. If the

exporter agrees with the information in

the Report/Certification, the exporter

must sign the Report/Certification and

submit it to Customs with a letter

containing an address for mailing the

refund. The Report/Certification must

be signed by an officer of the company

duly authorized to bind the company, or

an agent (such as a broker or freight

forwarder) authorized to sign the

document under a properly executed

power of attorney or a letter signed by

an authorized officer of the company.

Upon receipt of the signed Report/

Certification, Customs will issue the

refund. If the exporter disagrees with

the information in the Report/

Certification, the exporter must submit

a letter explaining its claim along with

proof of payment, either a copy of a

Harbor Maintenance Fee Quarterly

Summary Report, Customs Form 349,

for the quarter(s) covering the refund

requested or, if applicable, a copy of an

Export Vessel Movement Summary

Sheet or, where an Automated Summary

Monthly Shipper’s Export Declaration

was filed, a letter containing the

exporter’s identification, its employer

identification number (EIN), the Census

Bureau reporting symbol, and the

quarter for which the payment was

made. Upon receiving the letter and

documentation, Customs will conduct a

second review and will either confirm

the exporter’s claim and mail a revised

Report/Certification to the exporter or

its agent, or notify the exporter or its

agent that confirmation cannot be made.

In the latter instance, the Report/

Certification will not be revised. Upon

receipt of a properly signed Report/

Certification (initial or revised),

Customs will issue the refund. The

signed Report/Certification received by

Customs constitutes the exporter’s

agreement that Customs payment of the

refund amount determined to be owed

in the Report/Certification is in full

accord and satisfaction of all export fee

refund claims. The signed Report/

Certification also represents the

exporter’s release, waiver, and

abandonment of all claims against the

Government, its officers, agents, and

assigns for costs, attorney fees,

expenses, compensatory damages, and

exemplary damages. Upon receipt of the

signed Report/Certification, Customs

releases, waives, and abandons all

claims other than fraud against the

exporter, its officers, agents, or

employees arising out of all export fee

payments.

* * * * *

Charles W. Winwood,

Acting Commissioner of Customs.

Approved: May 18, 2001.

Timothy E. Skud,

Acting Deputy Assistant Secretary of the

Treasury.

[FR Doc. 01–16479 Filed 6–29–01; 8:45 am]

BILLING CODE 4820–02–P

DEPARTMENT OF TRANSPORTATION

Coast Guard

33 CFR Part 100

[CGD05–01–031]

RIN 2115–AE46

Special Local Regulations for Marine

Events; Maryland Swim for Life,

Chester River, Chestertown, Maryland

AGENCY: Coast Guard, DOT.

ACTION: Temporary final rule.

SUMMARY: The Coast Guard is adopting

temporary special local regulations for

the Maryland Swim for Life, a marine

event to be held on the waters of the

Chester River, Chestertown, Maryland.

These special local regulations are

necessary to provide for the safety of life

on navigable waters during the event.

This action is intended to restrict vessel

traffic in a portion of the Chester River

during the event.

DATES: This rule is effective from 6 a.m.

to 2 p.m. eastern time on July 14, 2001.

ADDRESSES: You may mail comments

and related material to Commander

(Aoax), Fifth Coast Guard District, 431

Crawford Street, Portsmouth, Virginia

23704–5004, or deliver them to the same

address between 9 a.m. and 2 p.m.,

Monday through Friday, except Federal

holidays. Comments and materials

received from the public as well as

documents indicated in this preamble as

being available in the docket, are part of

docket CGD05–01–031 and are available

for inspection or copying at Commander

(Aoax), Fifth Coast Guard District, 431

Crawford Street, Portsmouth, Virginia

23704–5004, between 9 a.m. and 2 p.m.,

Monday through Friday, except Federal

holidays.

FOR FURTHER INFORMATION CONTACT: S. L.

Phillips, Project Manager, Commander

(Aoax), Fifth Coast Guard District, 431

Crawford Street, Portsmouth, Virginia

23704–5004, telephone number (757)

398–6204.

SUPPLEMENTARY INFORMATION:

Regulatory Information

A notice of proposed rulemaking

(NPRM) was not published for this

regulation. In keeping with 5 U.S.C.

553(b)(B) and 553(d)(3), the Coast Guard

finds that good cause exists for not

publishing a NPRM and for making this

rule effective less than 30 days after

publication in the Federal Register. The

need for special local regulations for

this event was determined on May 21,

2001. The Coast Guard became aware of

the need for special local regulations

with insufficient time to publish an

NPRM, allow for comments, and

publish a final rule 30 days prior to the

event on July 14, 2001.

Background and Purpose

On July 14, 2001, the Maryland Swim

for Life Association will sponsor the

Maryland Swim for Life on the waters

of the Chester River. Approximately 100

swimmers will start from Rolph’s Wharf

and swim upriver 2 miles then swim

down river returning back to Rolph’s

Wharf. A large fleet of support vessels

will be accompanying the swimmers. To

provide for the safety of participants

and support vessels, the Coast Guard

will temporarily restrict vessel traffic in

the event area during the swim.

Discussion of Regulations

The Coast Guard is establishing

temporary special local regulations on

specified waters of the Chester River,

Chestertown, Maryland. The temporary

special local regulations will be in effect

from 6 a.m. to 2 p.m. eastern time on

July 14, 2001. The effect will be to

restrict general navigation in the

regulated area during the event. Except

for persons or vessels authorized by the

Coast Guard Patrol Commander, no

person or vessel may enter or remain in

the regulated area. These regulations are

needed to control vessel traffic during

the event to enhance the safety of

participants, spectators and transiting

vessels.

Regulatory Evaluation

This rule is not a ‘‘significant

regulatory action’’ under section 3(f) of

Executive Order 12866 and does not

require an assessment of potential costs

and benefits under section 6(a)(3) of that

Order. The Office of Management and

Budget has not reviewed it under that

Order. It is not significant under the

regulatory policies and procedures of

the Department of Transportation (DOT)

(44 FR 11040; February 26, 1979).