[Federal Register Volume 64, Number 28 (Thursday, February 11, 1999)]
[Rules and Regulations]
[Page 6801]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 99-3305]



[[Page 6801]]

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DEPARTMENT OF THE TREASURY

Customs Service

19 CFR Part 146

[T.D. 98-74]
RIN 1515-AB99


Lay Order Period; General Order; Penalties; Correction

AGENCY: U.S. Customs Service, Department of the Treasury.

ACTION: Final rule; correction.

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SUMMARY: This document makes a correction to the document published in 
the Federal Register that adopted as a final rule, with some changes, 
proposed amendments to the Customs Regulations regarding, among other 
things, the obligation of the owner, master, pilot, operator, or agent 
of an arriving carrier to provide notice to Customs and to a bonded 
warehouse of the presence of merchandise or baggage that has remained 
at the place of arrival or unlading beyond the time period provided by 
regulation without entry having been completed. The correction involves 
a conforming change to the Customs Regulations pertaining to foreign 
trade zones.

EFFECTIVE DATE: This correction is effective February 11, 1999.

FOR FURTHER INFORMATION CONTACT: For legal matters: Jeremy Baskin, 
Penalties Branch, Office of Regulations and Rulings (202) 927-2344. For 
operational matters: Steven T. Soggin, Office of Field Operations, 
(202) 927-0765.

SUPPLEMENTARY INFORMATION:

Background

    On September 25, 1998, Customs published in the Federal Register 
(63 FR 51283) T.D. 98-74 which adopted as a final rule, with some 
changes, proposed amendments to the Customs Regulations regarding the 
obligation of the owner, master, pilot, operator, or agent of an 
arriving carrier to provide notice to Customs and to a bonded warehouse 
of the presence of merchandise or baggage that has remained at the 
place of arrival or unlading beyond the time period provided by the 
regulatory amendments (that is, the fifteenth calendar day after 
landing) without entry having been completed. The final regulatory 
texts specifically require one of the arriving carrier's obligated 
parties, or any party who takes custody from the arriving carrier under 
a Customs-authorized permit to transfer or in-bond entry, to provide 
notice of the unentered merchandise or baggage to Customs and to a 
bonded warehouse no later than 20 calendar days after landing or after 
receipt under the permit to transfer or after arrival at the port of 
destination. The notice to the bonded warehouse proprietor initiates 
his obligation to arrange for transportation and storage of the 
unentered merchandise or baggage at the risk and expense of the 
consignee. The final regulatory texts also provide for penalties or 
liquidated damages against the owner or master of any conveyance, or 
agent thereof, for failure to provide the required notice to Customs or 
to a bonded warehouse proprietor. The final regulations further provide 
for the assessment of liquidated damages against any party who accepts 
custody of the merchandise or baggage under a Customs-authorized permit 
to transfer or in-bond entry and who fails to notify Customs and a 
bonded warehouse of the presence of such unentered merchandise or 
baggage and also against the warehouse operator who fails to take 
required possession of the merchandise or baggage.
    The final regulatory texts as summarized above resulted from 
amendments to the underlying statutory authority effected by sections 
656 and 658 contained within the Customs Modernization provisions of 
the North American Free Trade Agreement Implementation Act (Public Law 
103-182, 107 Stat. 2057) and are primarily reflected in a revised 
Sec. 4.37 (19 CFR 4.37) and in new Secs. 122.50 and 123.10 (19 CFR 
122.50 and 123.10), each of which is entitled ``[g]eneral order.'' 
(T.D. 98-74 also included a number of conforming changes to the Customs 
Regulations in order to reflect a number of other statutory amendments 
and repeals effected by the Customs Modernization provisions and in 
order to reflect the recent recodification and reenactment of title 49, 
United States Code; the correction contained in this document bears no 
relationship to those other regulatory amendments.)
    Although T.D. 98-74 also included a number of conforming regulatory 
changes to ensure consistency with the terms of revised Sec. 4.37 and 
new Secs. 122.50 and 123.10 (involving, for example, the removal or 
replacement of obsolete references to a ``5-day'' or ``lay order'' 
period or ``extension'' thereof), Sec. 146.40(c)(3) of the Customs 
Regulations (19 CFR 146.40(c)(3)) was overlooked in this regard. This 
provision concerns the treatment of general order merchandise in a 
foreign trade zone context. The present text, by referring to 
merchandise not admitted into a subzone or zone within ``5 working days 
after its arrival there'' and to an ``extension of the 5 working day 
period,'' is inconsistent with, and thus could give rise to uncertainty 
regarding the proper and intended applicability of, Secs. 4.37, 122.50 
and 123.10 in a foreign trade zone context. Therefore, T.D. 98-74 
should have included an appropriate revision of Sec. 146.40(c)(3) to 
clarify the operation of those general order provisions in that 
specific context. This document corrects this oversight.

Correction of Publication

    In the document published in the Federal Register as T.D. 98-74 on 
September 25, 1998 (63 FR 51283), on page 51290, in the third column, 
the following is added after the amendment to Sec. 127.28:

Part 146--Foreign Trade Zones

    1. The authority citation for Part 146 continues to read as 
follows:

    Authority: 19 U.S.C. 66, 81a-81u, 1202 (General Note 20, 
Harmonized Tariff Schedule of the United States), 1623, 1624.

    2. In Sec. 146.40, paragraph (c)(3) is revised to read as follows:


Sec. 146.40  Operator responsibilities for direct delivery.

* * * * *
    (c) * * *
    (3) General order. Merchandise not admitted into a subzone or zone 
site as provided in this section within 15 calendar days after its 
arrival there shall be disposed of in accordance with the applicable 
procedures in Sec. 4.37 or Sec. 122.50 or Sec. 123.10 of this chapter.
* * * * *
    Dated: February 5, 1999.
Stuart P. Seidel,
Assistant Commissioner, Office of Regulations and Rulings.
[FR Doc. 99-3305 Filed 2-10-99; 8:45 am]
BILLING CODE 4820-02-P