Proposed Rule2021-26874
Foreign Trade Regulations (FTR): New Filing Requirement and Clarifications to Current Requirements
Primary source
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Published
December 15, 2021
Issuing agencies
Commerce DepartmentCensus Bureau
Abstract
The Census Bureau is proposing to amend its regulations to reflect new export reporting requirements related to the country of origin. Specifically, the Census Bureau is proposing to add a conditional data element, country of origin, when Foreign origin is selected in the Foreign/Domestic Origin Indicator field in the Automated Export System (AES). In addition to the new export reporting requirement, the proposed rule would make remedial changes to the FTR to improve clarity and to correct errors.
Full Text
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<title>Federal Register, Volume 86 Issue 238 (Wednesday, December 15, 2021)</title>
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[Federal Register Volume 86, Number 238 (Wednesday, December 15, 2021)]
[Proposed Rules]
[Pages 71187-71190]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2021-26874]
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DEPARTMENT OF COMMERCE
Census Bureau
15 CFR Part 30
[Docket Number: 211117-0237]
RIN 0607-AA59
Foreign Trade Regulations (FTR): New Filing Requirement and
Clarifications to Current Requirements
AGENCY: Census Bureau, Commerce Department.
ACTION: Notice of proposed rulemaking.
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[[Page 71188]]
SUMMARY: The Census Bureau is proposing to amend its regulations to
reflect new export reporting requirements related to the country of
origin. Specifically, the Census Bureau is proposing to add a
conditional data element, country of origin, when Foreign origin is
selected in the Foreign/Domestic Origin Indicator field in the
Automated Export System (AES). In addition to the new export reporting
requirement, the proposed rule would make remedial changes to the FTR
to improve clarity and to correct errors.
DATES: Written comments must be received on or before February 14,
2022.
ADDRESSES: You may submit comments by any of the following methods:
<bullet> Federal eRulemaking Portal: <a href="https://www.regulations.gov">https://www.regulations.gov</a>.
The identification number for this rulemaking is identified by RIN
0607-AA59; or
<bullet> By email directly to <a href="/cdn-cgi/l/email-protection#e087948d84ce8694928e8f9489838593a083858e939593ce878f96"><span class="__cf_email__" data-cfemail="d6b1a2bbb2f8b0a2a4b8b9a2bfb5b3a596b5b3b8a5a3a5f8b1b9a0">[email protected]</span></a>. Include
RIN 0607-AA59 in the subject line.
All comments received are part of the public record. No comments
will be posted to <a href="https://www.regulations.gov">https://www.regulations.gov</a> for public viewing until
after the comment period has closed. Comments will generally be posted
without change. All Personally Identifiable Information (for example,
name and address) voluntarily submitted by the commenter may be
publicly accessible. Do not submit confidential business information or
otherwise sensitive or protected information.
FOR FURTHER INFORMATION CONTACT: Lisa E. Donaldson, Chief, Economic
Management Division, Census Bureau by phone (301) 763-7296 or by email
<a href="/cdn-cgi/l/email-protection#c2aeabb1a3eca7eca6adaca3aea6b1adac82a1a7acb1b7b1eca5adb4"><span class="__cf_email__" data-cfemail="a4c8cdd7c58ac18ac0cbcac5c8c0d7cbcae4c7c1cad7d1d78ac3cbd2">[email protected]</span></a>. Additionally, Stephanie L. Studds, Chief,
Economic Indicator Division, Census Bureau by phone (301) 763-2633 or
by email <a href="/cdn-cgi/l/email-protection#e09394859088818e8985ce8cce939495848493a083858e939593ce878f96"><span class="__cf_email__" data-cfemail="82f1f6e7f2eae3ecebe7aceeacf1f6f7e6e6f1c2e1e7ecf1f7f1ace5edf4">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION:
Background
The Census Bureau is responsible for collecting, compiling, and
publishing export trade statistics for the United States under the
provisions of Title 13, United States Code (U.S.C.), Chapter 9, Section
301. While the Census Bureau is the official source for U.S.
international trade statistics, the Census Bureau works in partnership
with U.S. Customs and Border Protection (CBP) to collect data regarding
both exports and imports. Additionally, the Census Bureau is
responsible for publishing the Foreign Trade Regulations (FTR) that set
the export reporting requirements for Electronic Export Information
(EEI). The EEI is made up of mandatory, conditional, and optional data
elements. The purpose of this rulemaking is to add a conditional data
element, country of origin, when Foreign origin is selected in the
Foreign/Domestic Origin Indicator field in the EEI. The FTR defines
foreign goods as goods that were originally grown, produced, or
manufactured in a foreign country, then subsequently entered into the
United States, admitted to a U.S. Foreign Trade Zone (FTZ), or entered
into a CBP bonded warehouse, but not substantially transformed in form
or condition by further processing or manufacturing in the United
States, U.S. FTZs, Puerto Rico, or the U.S. Virgin Islands.
Under Section 301 of Title 13 U.S.C., the Secretary of Commerce is
authorized to collect and publish import and export information
considered necessary or appropriate ``to foster, promote, develop, and
further'' domestic commerce. Executive Order (E.O.) 14017, ``America's
Supply Chains,'' sets forth the U.S. Government policy to build
resilient and diverse supply chains that increase domestic production,
diversify the supply of goods, feature redundancies, ensure adequate
stockpiles, and leverage the American manufacturing base and workforce.
(86 FR 11849; March 01, 2021). E.O. 14017 establishes a multi-agency
approach, which includes the Department of Commerce, in assessing and
identifying critical supply chain components and gaps in domestic
production filled by foreign nations that instead supply these goods.
These activities and broader supply chain analysis are necessary and
appropriate in furthering domestic commerce. Under the authorities in
Chapter 9 of Title 13, the Secretary of Commerce proposes to collect
data on the entry and origin of foreign goods into the United States to
improve the foreign trade statistics produced by the Census Bureau.
Currently, foreign trade statistics do not provide insight
sufficient to identify the gaps in domestic product and supply,
evaluate supply chains, or address trade imbalances. U.S. Government
agencies and private entities need accurate and complete foreign trade
statistics to create and monitor trade agreements, formulate trade
policy, assess U.S. supply chain issues, and identify and address trade
imbalances. Agencies and the private sector also use foreign trade
statistics to identify new markets for U.S. goods and services
globally.
The current Foreign/Domestic Origin Indicator field in the
Automated Export System (AES) creates significant data challenges and
limitations in using the trade statistics produced by the Census Bureau
and other Federal agencies because the Indicator does not capture the
country of origin. Currently, U.S. agencies rely on foreign trade
partners to share the data they collect on the foreign and domestic
origin of goods. This reliance limits U.S. agencies' ability to
identify asymmetry in imports and exports of goods, as any asymmetry
must be inferred by evaluating the data acquired from foreign trading
partners with the data collected on U.S. imports by CBP.
The collection of the Country of Origin field in AES for reexports
would eliminate the reliance on information provided by foreign
partners, thereby increase the accuracy and timeliness of the foreign
trade statistics used to monitor trade agreements and policy to assist
in assessing U.S. supply chain issues. The collection also would assist
U.S. Government agencies that use these statistics to reconcile trade
imbalances between the United States and our partner countries. The
U.S. Statistical Agencies collaborate globally to identify and
understand data asymmetries between one country's imports and the other
country's exports statistics.
By augmenting the Country of Origin field for exports in the AES,
the Census Bureau could produce trade statistics equivalent to the data
collected globally. The increased granularity in data collected through
a Country of Origin field would significantly improve the accuracy of
asymmetry evaluation as well as the creation, negotiation, and
evaluation of U.S. trade agreements and the ability to monitor goods
within U.S. supply chains. These data can provide critical insight to
U.S. supply chain issues, as the economy emerges from the pandemic.
Additionally, many of our trading partners require and collect a
detailed country of origin on their imports and exports. In consulting
with the Organisation for Economic Co-operation and Development and
other countries globally, the Census Bureau learned that this
information is mandatory for their collection. Through research
conducted with exporting companies, the Census Bureau has determined
that these data are available and can be provided by exporters, within
an estimated 12-18 months to update internal and/or proprietary
computer systems, and/or the technology they utilize to implement the
required changes to the AES.
Therefore, the Census Bureau is proposing to collect the Country of
Origin field on reexports to create official statistics.
[[Page 71189]]
The Census Bureau understands that the addition of country of
origin for reexports may have implications for the trade in filing in
the AES and complying with the FTR.
The Census Bureau is seeking public comments from data users,
businesses and others to assess this proposed change on foreign trade
statistics. Below are questions to consider when providing feedback to
this proposed rule; however, any pertinent feedback not captured by
these questions is welcome.
1. Describe potential uses of the Census Bureau's statistical data
of international trade.
2. Describe the potential value of adding country of origin to the
EEI if using the Census Bureau's statistical data of international
trade.
3. If a stakeholder utilized or managed proprietary software to
communicate with the AES, how long would it need to potentially add the
Country of Origin field?
4. How long would a company who utilizes or manages proprietary
software need to make programming changes to potentially add the
country of origin field to its interface to AES?
5. Are there business practices that a company would need to
implement in order to come into compliance with the reporting of the
Country of Origin field?
6. How would the country of origin be identified when companies
store or warehouse goods of multiple origins together?
Program Requirements
To comply with the requirements of the Foreign Relations Act,
Public Law 107-228, the Census Bureau is amending relevant sections of
the FTR to revise or clarify export reporting requirements. Therefore,
the Census Bureau is correcting 15 CFR part 30 by making the following
correcting amendments:
<bullet> Revise Sec. 30.2(d)(3) to remove the language, ``(See
Subpart B of this part for export control requirements for these type
of transactions.),'' as the exclusion overrides the export control
requirements.
<bullet> Revise Sec. 30.3(e)(1) to add the proposed data element,
``Country of origin,'' to the list of required data elements that need
to be provided by the U.S. Principal Party in Interest (USPPI) in a
routed export transaction.
<bullet> Revise Sec. 30.6(a)(1)(iii) to clarify that when the Dun
and Bradstreet Number (DUNS) is reported as the USPPI ID, the Employer
Identification Number (EIN) of the USPPI also is required to be
reported in the Automated Export System.
<bullet> Revise Sec. 30.6(b)(3) to amend the Foreign Trade Zone
(FTZ) identifier to allow for 9-digits. The increased number of digits
is required because of the increase in the number of subzones.
<bullet> Revise Sec. 30.6(b)(18) to add the conditional data
element ``Country of origin.'' The ``Country of origin'' will be the
code issued by the International Standards Organization and reported
when Foreign origin is selected in the Foreign/Domestic Origin
Indicator field in the Automated Export System.
<bullet> Revise Sec. 30.37(u) to remove and reserve the exemption
for technical data. This exemption is covered under Sec. 30.2(d)(3),
making the exemption redundant.
<bullet> Revise Sec. 30.55 to remove the citation ``19 CFR 103.5''
and add in its place ``19 CFR part 103.''
<bullet> Revise Sec. 30.71 to amend the Note to paragraph (b) to
address the yearly adjustments for civil penalties as a result of
inflation.
<bullet> Revise Sec. 30.74 to amend paragraph (c)(5) to remove
information that may become outdated and referencing the Census Bureau
website to obtain the most current method for submitting a Voluntary
Self-Disclosure.
Rulemaking Requirements
Regulatory Flexibility Act
The Chief Council for Regulation of the Department of Commerce has
certified to the Chief Counsel for Advocacy, Small Business
Administration that this proposed rule will not have a significant
economic impact on a substantial number of small entities.
In the current Foreign Trade Regulations (FTR), the Electronic
Export Information (EEI) shall be filed through the Automated Export
System (AES) for all exports of physical goods. The AES is the
electronic system for collecting Shipper's Export Declaration (SED) (or
any successor document) information from persons exporting goods from
the United States, Puerto Rico, Foreign Trade Zones located in the
United States and Puerto Rico, the U.S. Virgin Islands, between the
U.S. and Puerto Rico, and to the U.S. Virgin Islands from the United
States or Puerto Rico. In the proposed revisions, export shipments with
the Foreign origin selected in the Foreign/Domestic Origin Indicator
field will be required to report the country of origin.
In 2020, there were 33,716,623 total number of export records. Of
these 33,716,623 records, 23.45% (7,907,049 records) had exports
reported with a Foreign origin indicator by the authorized agent or the
USPPI. The Census Bureau has conducted research over the last year and
contacted 58 U.S. companies across 16 different industries (including
major freight forwarders). These companies represented the top 10% by
dollar value of exports reported under 31 Harmonized Tariff Schedule
(HTS) codes with a Foreign origin indicator. The Center for Economic
Studies provided the Census Bureau with questions related to these
companies' current ability to adhere to the country of origin
requirement. Based on the feedback to the inquiry, the Census Bureau
believes this proposed rule will not create any economic impact on all
companies including a substantial number of small entities.
Executive Orders
This proposed rule has been determined to not be significant for
purposes of Executive Order 12866. This proposed rule does not contain
policies with federalism implications sufficient to warrant preparation
of a federalism assessment under Executive Order 12612. This proposed
rule has been determined to be not significant for the purposes of
Executive Order 14017 ``America's Supply Chains.''
Paperwork Reduction Act
Notwithstanding any other provisions of law, no person is required
to respond to, nor shall a person be subject to, a penalty for failure
to comply with a collection of information subject to the requirements
of the Paperwork Reduction Act (PRA) unless that collection of
information displays a valid Office of Management and Budget (OMB)
control number.
This proposed rule covers collections of information subject to the
provisions of the PRA, which are cleared by OMB under OMB Control
Number 0607-0152--Automated Export System (AES) Program.
This proposed rule will not impact the current reporting-hour
burden requirements as approved under OMB Control Number 0607-0152
under provisions of the PRA. The proposed rule will not require any
revisions to the information sought under OMB Control Number 0607-0152.
Ron S. Jarmin, Acting Director, Census Bureau, approved the
publication of this notice of proposed rulemaking in the Federal
Register.
List of Subjects in 15 CFR Part 30
Economic statistics, Exports, Foreign trade, Reporting and
recordkeeping requirements.
For the reasons set out in the preamble, the Census Bureau is
[[Page 71190]]
proposing to amend 15 CFR part 30 as follows:
PART 30--FOREIGN TRADE REGULATIONS
0
1. The authority citation for 15 CFR part 30 continues to read as
follows:
Authority: 5 U.S.C. 301; 13 U.S.C. 301-307; Reorganization plan
No. 5 of 1990 (3 CFR 1949-1953 Comp., p.1004); Department of
Commerce Organization Order No. 35-2A, July 22, 1987, as amended,
and No. 35-2B, December 20, 1996, as amended; Public Law 107-228,
116 Stat. 1350.
0
2. Amend Sec. 30.2 by revising paragraph (d)(3) to read as follows:
Sec. 30.2 General requirements for filing Electronic Export
Information (EEI).
* * * * *
(d) * * *
(3) Electronic transmissions and intangible transfers.
* * * * *
0
3. Amend Sec. 30.3 by revising paragraphs (e)(1)(ii) and (vii) through
(xii) and adding paragraph (e)(1)(xiii) to read as follows:
Sec. 30.3 Electronic Export Information filer requirements, parties
to export transactions, and responsibilities of parties to export
transactions.
* * * * *
(e) * * *
(1) * * *
(ii) USPPI's EIN or DUNS.
* * * * *
(vii) Country of origin.
(viii) Schedule B or HTSUSA, Classification Commodity Code.
(ix) Quantities/units of measure.
(x) Value.
(xi) Export Control Classification Number (ECCN) or sufficient
technical information to determine the ECCN.
(xii) All licensing information necessary to file the EEI for
commodities where the Department of State, the Department of Commerce,
or other U.S. Government agency issues a license for the commodities
being exported, or the merchandise is being exported under a license
exemption or license exception.
(xiii) Any information that it knows will affect the determination
of license authorization (see subpart B of this part for additional
information on licensing requirements).
* * * * *
0
4. Amend Sec. 30.6 by revising paragraphs (a)(1)(iii) and (b)(3) and
adding paragraph (b)(18) to read as follows:
Sec. 30.6 Electronic Export Information data elements.
* * * * *
(a) * * *
(1) * * *
(iii) USPPI identification number. Report the Employer
Identification Number (EIN) of the USPPI. If the USPPI has only one
EIN, report that EIN. If the USPPI has more than one EIN, report the
EIN that the USPPI uses to report employee wages and withholdings, and
not the EIN used to report only company earnings or receipts. Use of
another company's EIN is prohibited. If a USPPI reports a DUNS, the EIN
is also required to be reported. If a foreign entity is in the United
States at the time goods are purchased or obtained for export, the
foreign entity is the USPPI. In such situations, when the foreign
entity does not have an EIN, the authorized agent shall report a border
crossing number, passport number, or any number assigned by CBP on
behalf of the foreign entity.
* * * * *
(b) * * *
(3) FTZ identifier. If goods are removed from a FTZ and not entered
for consumption, report the FTZ identifier. This is the unique 9-digit
alphanumeric identifier assigned by the Foreign Trade Zone Board that
identifies the FTZ, subzone or site from which goods are withdrawn for
export.
* * * * *
(18) Country of origin. If the goods exported are of foreign origin
and have undergone no change in form or condition or enhancement in
value by further manufacturing in the United States, U.S. FTZs, Puerto
Rico, or the U.S. Virgin Islands, report the foreign country in which
the commodities were grown, produced, manufactured, or substantially
transformed. For commodities with multiple origins, report the foreign
country of the commodity with the greatest value. If the USPPI does not
know the foreign country where the goods originated from, the country
of origin to be shown is the last foreign country, as known to the
USPPI at the time of shipment from the United States, from which the
goods were shipped in their present form. Report the country of origin
using the code issued by the International Standards Organization.
* * * * *
Sec. 30.37 [Amended]
0
5. Amend Sec. 30.37 by removing and reserving paragraph (u).
0
6. Amend Sec. 30.55 by revising the introductory text to read as
follows:
Sec. 30.55 Confidential information, import entries, and withdrawals.
The contents of the statistical copies of import entries and
withdrawals on file with the Census Bureau are treated as confidential
and will not be released without authorization by CBP, in accordance
with 19 CFR part 103 relating to the copies on file in CBP offices. The
importer or import broker must provide the Census Bureau with
information or documentation necessary to verify the accuracy or
resolve problems regarding the reported import transaction.
* * * * *
0
7. Amend Sec. 30.71 by designating the note to paragraph (b) as note 1
to paragraph (b) and revising the note to read as follows:
Sec. 30.71 False or fraudulent reporting on or misuse of the
Automated Export System.
* * * * *
Note 1 to paragraph (b): The civil monetary penalties are
adjusted for inflation annually based on The Federal Civil Penalties
Inflation Adjustment Act of 1990 (Pub. L. 101-410; 28 U.S.C. 2461),
as amended by the Debt Collection Improvement Act of 1996 (Pub. L.
104-134) and the Federal Civil Penalties Inflation Adjustment Act
Improvements Act of 2015 (Section 701 of Pub. L. 114-74). In
accordance with this Act, as amended, the penalties in Title 13,
Chapter 9, Sections 304 and 305(b), United States Code are adjusted
and published each year in the Federal Register no later than
January 15th.
0
8. Amend Sec. 30.74 by revising paragraph (c)(5) to read as follows:
Sec. 30.74 Voluntary self-disclosure.
* * * * *
(c) * * *
(5) Where to make voluntary self-disclosures. The information
constituting a Voluntary Self-Disclosure or any other correspondence
pertaining to a Voluntary Self-Disclosure may be submitted to the U.S.
Census Bureau, Branch Chief, Trade Regulations Branch by methods
permitted by the Census Bureau. See <a href="http://www.census.gov/foreign-trade">www.census.gov/foreign-trade</a> for
more details.
* * * * *
Dated: December 7, 2021.
Sheleen Dumas,
Department PRA Clearance Officer, Office of the Chief Information
Officer, Commerce Department.
[FR Doc. 2021-26874 Filed 12-14-21; 8:45 am]
BILLING CODE 3510-07-P
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