Houses Passes Miscellaneous Trade and Technical Corrections Bill (Full Summary)

On March 15, 2006, the House of Representatives passed H.R. 4944, the "Miscellaneous Trade and Technical Corrections Act of 2006" (Act) by a vote of 412 - 2.

A House Ways and Means Committee press release notes that a miscellaneous trade bill is usually considered every Congress (i.e., every two years) and duty suspensions mostly affect products not made in the U.S., but are components used by U.S. manufacturers.

In July and August 2005, the House Ways and Means Committee requested comments on almost 700 miscellaneous duty suspension and technical corrections bills. After the comments were reviewed, the Committee decided which bills should be included in the miscellaneous trade bill, taking into consideration the extent to which the bills create a revenue loss, operate retroactively, attract controversy, or are not administrable.

After its passage by the House, H.R. 4944 was sent to the Senate where it was referred to the Senate Finance Committee.

No Decision Yet on How, or If, Senate Will Proceed with Miscellaneous Trade Bill

According to Congressional sources, the Senate Finance Committee has not yet decided what action, if any, to take regarding a miscellaneous trade bill. Sources note that if the Senate does decide to proceed with a miscellaneous trade bill, a decision will be made as to whether the House bill (H.R. 4944) should be amended to include Senate bills or whether the Senate should introduce its own miscellaneous trade bill.

H.R. 4944 Includes AGOA Extension, Duty Suspensions, Reductions, Etc.

According to a Library of Congress summary, H.R. 4944 includes numerous provisions, including provisions to (partial list):

Amend the African Growth and Opportunity Act (AGOA) to extend certain trade benefits to sub-Saharan Africa until 2015;

Add numerous temporary duty suspension and reduction provisions and extend certain existing duty suspensions through December 31, 2009. Although most of these provisions are related to various chemicals, there are provisions for numerous types of other products, such as footwear, certain gloves, microphones, cosmetic bags, camel hair, bicycle arts, basketballs, volleyballs, and nail clippers and nail files.

Make certain Customs-related technical amendments.

AGOA Textile and Apparel Benefit Extension Through September 30, 2015

H.R. H.H.

H.R. 4944 would amend 19 USC 3721(f) in order to extend the effective date of the African Growth and Opportunity Act (AGOA) textile and apparel benefits in 19 USC 3721 through September 30, 2015 (from September 30, 2008).

(Subscribers should note that the HTS 9819.11.12 AGOA "third country" sublimit for apparel assembled or knit-to-shape and assembled, or both, in lesser developed AGOA country(ies), regardless of the country of origin of the fabric or yarn, has a different expiration date, September 30, 2007.

In addition, the standard GSP program (i.e., A, A*, and A) and the AGOA-GSP program (i.e., D) for AGOA beneficiary countries are currently in effect through September 30, 2015.)

Highlights of Customs-Related Technical Amendments

The following are "highlights" of the Customs-related technical amendments contained in H.R. 4944 (see bill text for complete description of all of the technical amendments):

Refunds prior to liquidation would not be limited to clerical errors, could be declared by importer. H.R. 4944 would amend 19 CFR 1520(a)(4) in order to allow the refund of duties or other receipts to be authorized as follows (added text is between ; deleted text is indicated by <>):

(4) Prior to liquidation. Prior to the liquidation of an entry or reconciliation, whenever an importer of record declares or it is ascertained that excess duties, fees, charges, or exactions have been deposited or paid <by reason of clerical error>.

Time limit for merchandise in bonded warehouses could be expanded beyond 5 years. H.R. 4944 would amend 19 USC 1557(a) (withdrawal of merchandise (from bonded warehouse); time; payment of charges) in order to allow merchandise to remain in a bonded warehouse beyond the current five year limit at the discretion of CBP, upon a proper request being filed and good cause shown.

H.R. 4944 would similarly amend 19 USC 1559 (warehouse goods deemed abandoned after 5 years) in order to allow merchandise to remain in a bonded warehouse beyond the current five year limit (without being regarded as abandoned) at the discretion of CBP, upon a proper request being filed and good cause shown.

Notification of whether an IASS will be filed would no longer be required. H.R. 4944 would amend 19 USC 1484(a)(1)(A) in order to remove the requirement when making entry that notification be filed with CBP on whether an import activity summary statement (IASS) will be filed.

IASS and reconfigured entries for goods released under special delivery permit. 19 USC 1484(a)(2)(A) would be revised so that certain entry regulations provide for the filing of IASS, and permit the filing of reconfigured entries, for merchandise released under a special delivery permit.

Customs-Related Technical Amendments Would Facilitate ACE Development

CBP sources have recently stated that some or all of the Customs-related technical amendments discussed above are the result of input from the Trade Support Network (TSN), and are intended to facilitate development of the Automated Commercial Environment (ACE).

New Temporary HTS Chapter 99 Duty Suspension/Reduction Provisions

A number of new, temporary Harmonized Tariff Schedule (HTS) Chapter 99 duty suspension or duty reduction provisions are contained in H.R. 4944. Most of these new provisions would provide for a free or reduced rate of duty through December 31, 2009. Subject products that are other than chemical products include (partial list):

Extension of Existing HTS Chapter 99 Temporary Suspension/Reduction Provisions Proposed

In addition, H.R. 4944's provisions would extend certain existing duty suspensions and duty reductions in HTS Chapter 99 through December 31, 2009. These extensions mostly affect chemicals, but also include certain high-tenacity yarn of viscose rayon, certain bags for toys, cases for certain children's products, certain 12V lead-acid storage batteries, certain R-core transformers, certain filament yarns, yarn of combed Kashmir (cashmere) or yarn of camel hair, certain semi-manufactured forms of gold, and cathode ray tubes.

In addition, H.R. 4944 would modify and extend certain other existing HTS Chapter 99 provisions, including a provision on certain yarn of carded Kashmir (cashmere) and certain educational devices (in addition to the provisions for various chemicals).

Liquidation or Reliquidation of Certain Entries

Liquidation/Reliq/Interest refunds for candles, roller chain, pasta, clock radios, etc. H.R. 4944 would provide for the liquidation or reliquidation of certain specified entries, in many instances requiring a request to be filed and refund any amounts owed with interest, as follows:

Specified tramway cars and associated spare parts - duty-free entry, or duty-free reliquidation, as applicable

Candles - reliquidation of listed entries without assessment of antidumping (AD) duties or interest (and refund of any previously paid AD duties and interest)

Roller chain - liquidation or reliquidation of listed entries without assessment of interest (and refund of interest previously paid)

Pasta - liquidate or reliquidate listed entries in accordance with AD case A-475-818 for the period July 1, 2001 through June 30, 2002 under CBP message 4068201

Soundspa clock radios - reliquidation at the duty rate applicable to HTS 8527.19.10 of listed entries containing any merchandise which, on the date of original liquidation, was classified under HTS 8527.19.50 (and refund any amounts owed with interest)

Interest refunds for antifriction bearings, tomato sauce preparation. H.R. 4944 also includes a provision for the reliquidation, in order to pay interest, of certain entries of antifriction bearings and tomato sauce preparations provided for in the Tariff Suspension and Trade Act of 2000 (Public Law (P.L.) 106-476) and the Miscellaneous Trade and Technical Corrections Act of 2004 (P.L. 108-429).

Interest refunds on certain entries prematurely liquidated in error. H.R. 4944 also contains a provision which requires CBP to reliquidate in order to pay interest on entries provided for in section 1511(d) of the Miscellaneous Trade and Technical Corrections Act of 2004 (certain entries prematurely liquidated in error) that were reliquidated without the payment of interest.

Miscellaneous Provisions

The miscellaneous provisions section of H.R. 4944 contains various revisions of the HTS provisions (along with conforming amendments and changes to staged duty reductions, as applicable) for the following:

rattan webbing (HTS 4601.91)

certain monochrome glass envelopes (HTS 7011.20, 9902)

certain tractor body parts (HTS 8708.29)

certain flexible magnets and composite goods containing flexible magnets (HTS 8505.19)

fine animal hair of Kashmir (cashmere) goats (HTS 9902.51)

Technical Corrections

H.R. 4944 includes numerous technical corrections affecting the following HTS Chapter 85 and 99 HTS numbers (these corrections revise the HTS article descriptions, repeal the provision, etc.):

H.R. 4944 also includes various corrections to P.L. 108-429 that correct typographical errors, etc.

Cigarettes and smokeless tobacco products. In addition, H.R. 4944 contains numerous amendments to the Tariff Act of 1930 and the Internal Revenue Code of 1986 related to cigarettes and smokeless tobacco products, which are highlighted below.

H.R. 4944 would amend the requirements in 19 USC 1681 applicable to imports of certain cigarettes by adding a new definition for "delivery sale" for cigarettes and smokeless tobacco.

("Delivery sale" would be defined as any sale of cigarettes or a smokeless tobacco product to a consumer if (a) the consumer submits the order for such sale by means of a telephone or other method of voice transmission, the mail, or the Internet or another online service, or the seller is otherwise not in the physical presence of the buyer when the request for purchase or order is made; or (b) the cigarettes or smokeless tobacco product is delivered by use of a common carrier, private delivery service, or the mail, or the seller is not in the physical presence of the buyer when the buyens¹ personal possession of the delivered cigarettes or smokeless tobacco product.)

¹This appears to be part of a typographical error in the text of H.R. 4944

H.R. 4944 also exclude cigarettes or smokeless tobacco products sold in connection with a delivery sale from receiving the benefits of the personal use exemption provided for in 19 USC 1681a(b)(1).

H.R. 4944 would add a new provision to 19 USC 1681, which allows a State, through its Attorney General, to obtain copies of any Customs certifications required for cigarette imports upon proper request by an importer, manufacturer, their authorized officials, etc.

H.R. 4944 would also amend the enforcement provisions in 19 USC 1681b(b) and would amend various provisions in 19 USC 1681a and 1681b to include the phrase "or smokeless tobacco product" after cigarette each place it appears and to add references to the Comprehensive Smokeless Tobacco Health Education Act of 1986.

In addition, H.R. 4944 would also amend Section 5761 of the Internal Revenue Code of 1986 (relating to civil penalties) by adding a new subsection (d) on Personal Use Quantities.

Amendment for Cellar Treatment of Natural Wine

H.R. 4944 would also amend Section 5382(a)(1)(A) of the Internal Revenue Code of 1986 (relating to cellar treatment of natural wine) by striking "stabilize" and inserting "correct or stabilize."

H.R. 4944 as passed by the House available at http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=109_cong_bills&docid=f:h4944eh.txt.pdf.

House Ways and Means press release on passage of H.R. 4944 (dated 03/15/06) available at http://waysandmeans.house.gov/News.asp?FormMode=release&ID=381.

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