Details of Census' Proposed Rule to Implement Mandatory AES Filing for All Exports that Require SED Information (Part IX)

(AES is the electronic method for filing the paper SED information directly with U.S. Customs and Border Protection (CBP) and Census. AESDirect is the Census' free Internet-based system for filing SED information with AES.)

This is Part IX of a multi-part series of summaries and highlights Census' proposed regulations in 15 CFR 30.35 through 30.44 (Subpart D) concerning exemptions from Electronic Export Information (EEI) filing requirements. See future issues of ITT for additional summaries.

Subpart D Would Detail Proposed Exemptions from EEI Filing Requirements

Proposed Subpart D (15 CFR 30.35 - 30.44) would describe exemptions from the requirements for filing EEI. Proposed 15 CFR 30.35 would state that where an exemption from the requirement for filing is provided in proposed Subpart D, a legend describing the basis for the exemption would be made on the first page of the bill of lading, air waybill, or other commercial loading document for carrier use, or on the carrier's outbound manifest. The exemption legend would also reference the number of the section or provision in 15 CFR Part 30 where the particular exemption is provided.

The following are the exemptions that would be provided in Subpart D:

Exemption for shipments destined to Canada. With certain specified exceptions to this exemption (see 15 CFR 30.2(a)(1)(iv) and 30.36(b)), 15 CFR 30.36(a) would state that shipments originating in the U.S. where the country of ultimate destination is Canada would be exempt from the EEI reporting requirements of proposed 15 CFR Part 30.

Miscellaneous exemptions. EEI would not be required for the following kinds of shipments. However, Census would have the authority to periodically require the reporting of shipments that are normally exempt from filing. The miscellaneous exemptions listed under proposed 15 CFR 30.37 are (see proposed 15 CFR 30.37 for complete details and exceptions to these exemptions):

Value of commodities is $2,500 or less. Proposed 15 CFR 30.37(a) provides an exemption for certain instances where the value of commodities shipped from one U.S. Principal Party in Interest (USPPI) to one consignee on a single exporting carrier classified under an individual Schedule B or HTS commodity classification code, is $2,500 or less. (See proposed 15 CFR 30.37(a) for complete details and certain types of shipments that do not qualify for this exemption.)

Certain tools of the trade and their containers. Proposed 15 CFR 30.37(b) would provide an exemption for certain tools of the trade and their containers that are usual and reasonable kinds and quantities of commodities and software intended for use by individual USPPIs or by employees or representatives of the exporting company in furthering the enterprises and undertakings of the USPPI abroad. (See proposed 15 CFR 30.37(b) for complete eligibility information.)

U.S. shipments passing through Canada or Mexico. Proposed 15 CFR 30.37(c) would exempt shipments from one point in the U.S. to another point in the U.S. by routes passing through Canada or Mexico.

Canadian or Mexican shipments passing through U.S. Proposed 15 CFR 30.37(d) would provide that shipments from one point in Canada or Mexico to another point in the same country by routes through the U.S. are exempt.

Certain shipments transported in bond through the U.S. and exported from another U.S. port, etc. Proposed 15 CFR 30.37(e) would provide an exemption for certain shipments, other than by vessel, of goods for which no export licenses or International Traffic in Arms Regulations (ITAR) exemptions are required, that are transported in bond through the U.S. and exported from another U.S. port, or transshipped and exported directly from the port of arrival.

However, where goods are shipped through the U.S. for export to a third country of ultimate destination, but are first entered for consumption or for warehousing in the U.S., EEI would be filed when the goods are exported from the U.S.

Certain exports of technology and software. Proposed 15 CFR 30.37(f) would exempt exports of technology and software as defined in 15 CFR Part 772 that do not require an export license are exempt from filing requirements. However, EEI is required for mass-market software. For purposes of 15 CFR Part 30, mass-market software is defined as software that is generally available to the public by being sold at retail selling points, or directly from the software developer or supplier, by means of over-the-counter transactions, mail-order transactions, telephone transactions, or electronic mail-order transactions, and designed for installation by the user without further substantial technical support by the developer or supplier.

Intangible exports of software and technology. Proposed 15 CFR 30.37(g) would provide an exemption for intangible exports of software and technology, such as downloaded software and technical data, regardless of whether an export license is required, and mass-market software exported electronically.

Shipments to foreign libraries, government establishments, etc. Shipments to foreign libraries, government establishments, or similar institutions, as provided in proposed 15 CFR 30.40(d) would be exempted under proposed 15 CFR 30.37(h).

Certain gifts and donations. Proposed 15 CFR 30.37(i) would provide an exemption for shipments as authorized under License Exception GFT for gift parcels and humanitarian donations (see 15 CFR 740.12).

Diplomatic pouches. Proposed 15 CFR 30.37(j) would provide an exemption for diplomatic pouches and their contents.

Human remains, etc. Human remains and accompanying appropriate receptacles and flowers would be exempt from the proposed rule's requirements under proposed 15 CFR 30.37(k).

Certain interplant correspondence. Proposed 15 CFR 30.37(l) would provide an exemption for shipments of interplant correspondence, executed invoices and other documents, and other shipments of company business records from a U.S. firm to its subsidiary or affiliate, excluding highly technical plans, correspondence, etc. that could be licensed.

Pets as baggage. Proposed 15 CFR 30.37(m) would exempt shipments of pets as baggage, accompanied or unaccompanied, of persons leaving the U.S., including members of crews on vessels and aircraft.

Carriers' stores. Proposed 15 CFR 30.37(n) would provide an exemption for carriers' stores, not shipped under a bill of lading or an air waybill (including goods carried in ships aboard carriers for sale to passengers), supplies, and equipment for departing vessels, planes, or other carriers, including usual and reasonable kinds and quantities of bunker fuel, deck engine and steward department stores, provisions and supplies, medicinal and surgical supplies, food stores, slop chest articles, and saloon stores or supplies for use or consumption on board and not intended for unlading in a foreign country, and including usual and reasonable kinds and quantities of equipment and spare parts for permanent use on the carrier when necessary for proper operation of such carrier and not intended for unlading in a foreign country. Hay, straw, feed, and other appurtenances necessary to the care and feeding of livestock while en route to a foreign destination are considered part of carriers' stores of carrying vessels, trains, planes, etc.

Certain dunnage. Proposed 15 CFR 30.37(o) would provide an exemption for dunnage, not shipped under a bill of lading or an air waybill, of usual and reasonable kinds and quantities necessary and appropriate to stow or secure cargo on the outgoing or any immediate return voyage of an exporting carrier, when exported solely for use as dunnage and not intended for unlading in a foreign country.

Shipments of aircraft parts and supplies for use on an aircraft, etc. 15 CFR 30.37(p) would provide an exemption for shipments of aircraft parts and equipment; food, saloon, slop chest, and related stores; and provisions and supplies for use on aircraft by a U.S. airline to its own installations, aircraft, and agents abroad, under EAR license exception (AVS) for aircraft and vessels (see 15 CFR 740.15(c)).

Certain types of commodities not requiring EEI. Proposed 15 CFR 30.37(q) would provide that EEI is not required for the following types of commodities when they are not shipped as cargo under a bill of lading or an air waybill and do not require an export license, but the USPPI shall be prepared to make an oral declaration to the U.S. Customs and Border Protection (CBP) Port Director, when required: baggage and personal effects, accompanied or unaccompanied, of persons leaving the U.S., including members of crews on vessels and aircraft.

Limited exemption from the requirements for reporting complete commodity information (personal articles). Proposed 15 CFR 30.38 would set forth certain types of shipments which would require limited reporting of EEI when goods are shipped under a bill of lading or an air waybill. In such cases, Schedule B or HTS commodity classification codes, unit of measure, and domestic/foreign indicator would not be required. Among other things, these exemptions include usual and reasonable kinds and quantities of wearing apparel, articles of personal adornment, toilet articles, medicinal supplies, food, souvenirs, games, and similar personal effects, furniture, vehicles, etc. (See proposed 15 CFR 30.38 for complete details and conditions for obtaining this exemption.)

Special exemptions for shipments to U.S. armed services & U.S. government agencies and employees. Proposed 15 CFR 30.39 would provide that EEI is not required for any and all commodities, whether shipped commercially or through government channels, consigned to the U.S. armed services for their exclusive use, including shipments to the armed services exchange systems. However, this exemption does not apply to articles that are on the U.S. Munitions List (USML) or controlled by ITAR and shipments that are not consigned to the U.S. armed services but are for their ultimate use.

Proposed 15 CFR 30.40 would provide a special exemption from EEI filing for certain types of shipments to U.S. government agencies and their employees.

to implement provisions in the Foreign Relations Authorization Act, Public Law (P.L.) 107-228

- written comments due by 04/18/05

(See ITT's Online Archives or 10/29/03 news, 03012910, for BP summary of the Census' advance notice of proposed rulemaking on these issues. See ITT's Online Archives or 02/18/05, 02/24/05, 03/02/05, 03/03/05, 03/04/05, 03/09/05, 03/10/05, and 03/15/05 news, 05021810, 05022430, 05030215, 05030325, 05030415, 05030915, 05031025, and 05031535, for Parts I-VIII of BP's series of summaries on the proposed rule.)

Census contact - C. Harvey Monk, Jr. (301) 763-2255

Census proposed rule (FR Pub 02/17/05, D/N 031009254-4355-02) available at

http://a257.g.akamaitech.net/7/257/2422/01jan20051800/edocket.access.gpo.gov/2005/pdf/05-2926.pdf