CSMS Message: 01-001075

OCTOBER 4, 2001

TO: DIRECTORS, FIELD OPERATIONS

FROM: EXECUTIVE DIRECTOR, TRADE PROGRAMS
OFFICE OF FIELD OPERATIONS

PASS TO: PORT DIRECTORS; ASSISTANT PORT DIRECTORS, TRADE;
NATIONAL IMPORT SPECIALISTS; IMPORT SPECIALISTS;
INSPECTORS; ENTRY SPECIALISTS; BROKERS AND
IMPORTERS

SUBJECT: TBT-01-045 INFORMATION FOR THE BRASSIERE PROVISION
OF THE CARIBBEAN BASIN TRADE PARTNERSHIP ACT
(CBTPA)

BACKGROUND:

TITLE II OF THE TRADE AND DEVELOPMENT ACT OF 2000 ("THE ACT"),
WHICH WAS SIGNED INTO LAW ON MAY 18, 2000, AUTHORIZED THE
EXPANSION OF TRADE BENEFITS TO DESIGNATED COUNTRIES IN THE
CARIBBEAN BASIN. THIS TRADE PROGRAM PROVIDES FOR THE ENTRY OF
SPECIFIC TEXTILE AND APPAREL ARTICLES FREE OF DUTY AND FREE OF
ANY QUANTITATIVE RESTRICTIONS, LIMITATIONS OR CONSULTATION
LEVELS.

INTERIM REGULATIONS ENTITLED "PREFERENTIAL TREATMENT OF
BRASSIERES UNDER THE UNITED STATES-CARIBBEAN BASIN TRADE
PARTNERSHIP ACT" WAS PUBLISHED IN THE FEDERAL REGISTER ON
THURSDAY, OCTOBER 4, 2001. THIS NOTICE SERVES TO PROVIDE
INSTRUCTIONS TO IMPLEMENT THOSE PROVISIONS WITHIN THE CARIBBEAN
BASIN TRADE PARTNERSHIP ACT (THE CBTPA) THAT ESTABLISH STANDARDS
FOR PREFERENTIAL TREATMENT FOR BRASSIERES IMPORTED FROM CBTPA
BENEFICIARY COUNTRIES. THIS NOTICE CONTAINS THE METHODS,
PROCEDURES AND RELATED STANDARDS THAT WILL APPLY FOR PURPOSES OF
DETERMINING COMPLIANCE WITH THE 75 PERCENT AGGREGATE U.S. FABRIC
COMPONENTS CONTENT REQUIREMENT UNDER THE CBTPA BRASSIERES
PROVISION.

THE PREFERENCE PROVISION IS DESCRIBED IN THE ACT AS:
BRASSIERES CLASSIFIABLE IN SUBHEADING 6212.10 OF THE HTS,
BOTH CUT AND SEWN OR OTHERWISE ASSEMBLED IN THE UNITED STATES
OR ONE OR MORE DESIGNATED BENEFICIARY COUNTRIES OR BOTH.
(9820.11.15) (19 C.F.R. 10.223 {A}{6})

FURTHER AS PROVIDED FOR IN HARMONIZED TARIFF SCHEDULE
AND BASED ON PROVISIONS WITHIN THE ACT.

FOR PURPOSES OF SUBHEADING 9820.11.15, IMPORTS OF
BRASSIERES OF A PRODUCER OR AN ENTITY CONTROLLING
PRODUCTION, DURING THE 1-YEAR PERIOD BEGINNING ON
OCTOBER 1, 2001, AND DURING EACH OF THE SIX
SUCCEEDING 1-YEAR PERIODS, SHALL BE ELIGIBLE FOR
PREFERENTIAL TREATMENT ONLY IF THE AGGREGATE COST
OF FABRIC COMPONENTS FORMED IN THE UNITED STATES
THAT ARE USED IN THE PRODUCTION OF ALL SUCH
ARTICLES OF THAT PRODUCER OR ENTITY DURING THE
PRECEDING 1-YEAR PERIOD IS AT LEAST 75 PERCENT OF
THE AGGREGATE DECLARED CUSTOMS VALUE OF THE FABRIC
CONTAINED IN ALL SUCH ARTICLES OF THAT PRODUCER OR
ENTITY THAT ARE ENTERED DURING THE PRECEDING
1-YEAR PERIOD. REFER TO SUBCHAPTER XX U.S. NOTE 2
(D) OF THE HTSUS.

RULES OF APPLICATION

FOR PURPOSES OF PREFERENTIAL TARIFF TREATMENT, THE FOLLOWING
RULES WILL APPLY:

(A) THE ARTICLES IN QUESTION MUST CONFORM TO THE DESCRIPTION SET
FORTH IN THE ACT AND MUST BE BOTH PRODUCED AND ENTERED WITHIN
THE SAME YEAR;

(B) ARTICLES THAT ARE EXPORTED TO COUNTRIES OTHER THAN THE UNITED
STATES AND ARE NEVER ENTERED ARE NOT CONSIDERED IN
DETERMINING COMPLIANCE WITH THE 75 OR 85 PERCENT STANDARD
SPECIFIED

(C) FABRIC COMPONENTS AND FABRICS THAT CONSTITUTE FINDINGS OR
TRIMMINGS OF FOREIGN ORIGIN AS DEFINED IN THE ACT ARE NOT TO
BE CONSIDERED IN DETERMINING COMPLIANCE WITH THE 75 OR 85
PERCENT STANDARD;

(D) AN ARTICLE IS CONSIDERED TO BE PRODUCED IN THE YEAR IN WHICH
IT REACHES THE CONDITION IN WHICH IT IS SHIPPED TO THE UNITED
STATES

(E) BEGINNING OCTOBER 1, 2001, IN ORDER FOR ARTICLES TO BE
ELIGIBLE FOR PREFERENTIAL TREATMENT IN A GIVEN YEAR, A
PRODUCER OF, OR ENTITY CONTROLLING PRODUCTION OF, THOSE
ARTICLES MUST HAVE MET THE 75 PERCENT STANDARD DURING THE
IMMEDIATELY PRECEDING YEAR. IF ARTICLES OF A PRODUCER OR
ENTITY CONTROLLING PRODUCTION FAIL TO MEET THE 75 PERCENT
STANDARD DURING A YEAR, ARTICLES OF THAT PRODUCER OR ENTITY
CONTROLLING PRODUCTION:

(1) WILL NOT BE ELIGIBLE FOR PREFERENTIAL TREATMENT
DURING THE FOLLOWING YEAR;

(2) WILL REMAIN INELIGIBLE FOR PREFERENTIAL
TREATMENT UNTIL THE YEAR THAT FOLLOWS A YEAR IN
WHICH ARTICLES OF THAT PRODUCER OR ENTITY
CONTROLLING PRODUCTION MET THE 85 PERCENT STANDARD; AND

(3) AFTER THE 85 PERCENT STANDARD HAS BEEN MET,
WILL AGAIN BE SUBJECT TO THE 75 PERCENT STANDARD
DURING THE FOLLOWING YEAR FOR PURPOSES OF
DETERMINING ELIGIBILITY FOR PREFERENTIAL TREATMENT
IN THE NEXT YEAR;

(F) A NEW PRODUCER OR NEW ENTITY CONTROLLING PRODUCTION, THAT IS,
A PRODUCER OR ENTITY CONTROLLING PRODUCTION WHO DID NOT
PRODUCE OR CONTROL PRODUCTION DURING THE PRECEDING YEAR, MUST
FIRST ESTABLISH COMPLIANCE WITH THE 75 PERCENT STANDARD AS A
PREREQUISITE TO PREPARATION OF THE DECLARATION OF COMPLIANCE;
{19CFR 10.228(C)}, AND BEFORE QUALIFYING FOR DUTY FREE
TREATMENT.

(G) A DECLARATION OF COMPLIANCE PREPARED BY A PRODUCER OR AN
ENTITY CONTROLLING PRODUCTION MUST COVER ALL PRODUCTION OF
THAT PRODUCER OR ALL THE PRODUCTION THAT ENTITY CONTROLS;

(H) A PRODUCER WOULD NOT PREPARE A DECLARATION OF COMPLIANCE IF
ALL OF ITS PRODUCTION IS COVERED BY A DECLARATION OF
COMPLIANCE PREPARED BY AN ENTITY CONTROLLING PRODUCTION;

(I) IN THE CASE OF A PRODUCER, THE 75 OR 85 PERCENT STANDARD
SPECIFIED APPLIES TO ALL ARTICLES OF THAT PRODUCER FOR THE
YEAR IN QUESTION, EVEN IF SOME BUT NOT ALL OF THAT PRODUCTION
IS ALSO COVERED BY A DECLARATION OF COMPLIANCE PREPARED BY AN
ENTITY CONTROLLING PRODUCTION;

(J) THE U.S. IMPORTER DOES NOT HAVE TO BE THE PRODUCER OR THE
ENTITY CONTROLLING PRODUCTION THAT PREPARED THE DECLARATION
OF COMPLIANCE; AND

(K) PRODUCERS OR ENTITIES CONTROLLING PRODUCTION CAN OBTAIN AN
IDENTIFIER NUMBER BY FILING A DECLARATION OF COMPLIANCE

ANY PRODUCER OR CONTROLLING ENTITY THAT HAS ALREADY FORWARDED A
REQUEST FOR THE NECESSARY IDENTIFIER NUMBER WILL BE RECEIVING THEIR
NUMBER SOON. AS A RESULT OF THE DELAY IN PUBLISHING THESE REGULATIONS
AND THE CURRENT RELOCATION EFFORTS OF OUR NEW YORK OFFICES, IT IS
REQUESTED THAT UNTIL NOVEMBER 1, 2001, THE DECLARATIONS SHOULD
BE SENT TO:

U.S. CUSTOMS SERVICE
OFFICE OF TRADE OPERATIONS
RONALD REAGAN BUILDING SUITE 5.3D
1300 PENNSYLVANIA AVE. N.W.
WASHINGTON, D.C. 20229
ATTENTION: ROBERT ABELS

AFTER NOVEMBER 1, 2001, THEY CAN BE SENT TO:

U.S. CUSTOMS SERVICE
OFFICE OF STRATEGIC TRADE
1 PENN PLAZA TENTH FLOOR
NEW YORK, NEW YORK 10119
ATTENTION: MAJORIE DELOACH
DIRECTOR

ADDITIONALLY, YOU ARE REMINDED THAT THERE ARE NO VISA
REQUIREMENTS OR QUOTA RESTRAINTS APPLICABLE TO BRASSIERES
CORRECTLY CLASSIFIED UNDER HTS NUMBER 9820.11.15.

IMPORTER RESPONSIBILITIES

A CBTPA TEXTILE CERTIFICATE OF ORIGIN, COMPLETED BY THE
EXPORTER, MUST BE IN THE POSSESSION OF THE IMPORTER AND
AVAILABLE UPON REQUEST TO U.S. CUSTOMS WHEN THE CLAIM IS MADE.
THE FORMAT CAN BE FOUND IN 19 C.F.R. 10.224 OF THE CUSTOMS
REGULATIONS (PUBLISHED IN THE FEDERAL REGISTER DATED OCTOBER 5,
2000).

AGAIN, BECAUSE OF THE DELAY IN PUBLISHING THE NECESSARY
REGULATIONS, THERE WILL BE GRACE PERIOD OF APPROXIMATELY THIRTY
DAYS FROM THE DATE OF POSTING OF THIS NOTICE TO PERMIT IMPORTERS
TIME TO OBTAIN THE NECESSARY IDENTIFIER NUMBER. AS SOON AS
POSSIBLE, BUT NOT LATER THAN NOVEMBER 15, 2001, THE U.S.
IMPORTER MUST INCLUDE A SPECIFIC DOCUMENTATION IDENTIFIER
ASSIGNED BY CUSTOMS WHEN FILING THE CLAIM FOR PREFERENTIAL
TREATMENT. CUSTOMS CONSIDERS A SPECIFIC DOCUMENTATION
IDENTIFIER NECESSARY. THE IDENTIFIER, WHICH IS TO BE NOTED ON
THE ENTRY SUMMARY OR WAREHOUSE WITHDRAWAL, WILL SERVE BOTH THE
IMPORTER AND CUSTOMS. THIS IDENTIFIER NUMBER IS A METHOD FOR
THE IMPORTER TO INDICATE AT THE TIME OF ENTRY A SPECIFIC BASIS
FOR CLAIMING PREFERENTIAL TREATMENT THAT EITHER THE 75 OR THE 85
PERCENT REQUIREMENT HAS BEEN MET IN THE PRECEDING YEAR FOR THE
BRASSIERES BEING ENTERED AND THUS WILL FACILITATE THE ENTRY AND
CLEARANCE PROCESS. THE IDENTIFIER SERVES CUSTOMS AS A MEANS BY
WHICH CUSTOMS CAN TIE A PARTICULAR ENTRY TO THE FACT THAT A
PRODUCER OF BRASSIERES OR AN ENTITY CONTROLLING PRODUCTION OF
BRASSIERES HAS MET THE 75 OR 85 PERCENT REQUIREMENT. THIS IS
ESSENTIAL IN VIEW OF THE FACT THAT COMPLIANCE WITH THE 75 OR 85
PERCENT REQUIREMENT MUST BE ESTABLISHED BY A PRODUCER OR BY AN
ENTITY CONTROLLING PRODUCTION WHO MIGHT NOT BE THE U.S.
IMPORTER. THE IDENTIFIER WILL BE REPORTED IN BLOCK 34 OF THE
CF7501 (VISA FIELD.) THE IDENTIFIER WILL CONSIST OF NINE
CHARACTERS, THE FIRST CHARACTER BEING NUMERIC REPRESENTING THE
YEAR OF ISSUANCE (I.E. "1" FOR 2001), THEN TWO ALPHAS "CB"
INDICATING THE CARIBBEAN BASIN AND THEN A SIX DIGIT SERIAL
NUMBER STARTING WITH A "1" FOR A PRODUCER AND "2" FOR A ENTITY
CONTROLLING PRODUCTION. U.S. CUSTOMS WILL ASSIGN THIS NUMBER.

DOCUMENTATION -- INITIAL DECLARATION OF COMPLIANCE
{19CFR 10.228 (C)}

STARTING OCTOBER 1, 2002 RECOMMENDED THAT THE PRODUCER OR ENTITY
CONTROLLING PRODUCTION FILE FOR A DECLARATION, IT IS OF
COMPLIANCE 10 DAYS PRIOR TO OCTOBER 1ST OR 10 DAYS PRIOR TO THE
DATE OF THE FIRST SHIPMENT OF ARTICLES TO THE UNITED STATES.
THIS YEAR (OCTOBER 1, 2001 TO SEPTEMBER 30, 2002), THE
DECLARATION SHOULD BE FILED 10 DAYS PRIOR TO THE DATE OF THE
FIRST SHIPMENT. AGAIN, FOR THOSE PRODUCERS OR ENTITIES
CONTROLLING PRODUCTION THAT HAVE ALREADY FILED A DECLARATION,
THE IDENTIFIER NUMBER WILL BE ISSUED SOON. IF THE DECLARATION
OF COMPLIANCE IS NOT PROCESSED TIMELY AND THE IMPORTER COULD NOT
MAKE THE DUTY-FREE CLAIM, THE IMPORTER CAN AVAIL THEMSELVES TO
THE POST ENTRY PROCESS. AFTER FILING HAS BEEN COMPLETED,
CUSTOMS WILL ADVISE THE PRODUCER OR THE ENTITY CONTROLLING
PRODUCTION OF THE DISTINCT AND UNIQUE IDENTIFIER ASSIGNED TO
THAT DECLARATION. IT WILL BE THE RESPONSIBILITY OF THE PRODUCER
OR THE ENTITY CONTROLLING PRODUCTION TO ADVISE EACH APPROPRIATE
U.S. IMPORTER OF THAT DISTINCT AND UNIQUE IDENTIFIER FOR
PURPOSES OF COMPLIANCE.

VERIFICATION OF DECLARATION OF COMPLIANCE

A FILED DECLARATION OF COMPLIANCE WILL BE SUBJECT TO WHATEVER
VERIFICATION CUSTOMS DEEMS NECESSARY. IN THE EVENT THAT CUSTOMS
FOR ANY REASON IS PREVENTED FROM VERIFYING THE STATEMENTS ON A
DECLARATION OF COMPLIANCE, CUSTOMS MAY DENY ANY CLAIM FOR
PREFERENTIAL TREATMENT BASED ON THAT DECLARATION. A
VERIFICATION OF A DECLARATION OF COMPLIANCE MAY INVOLVE, BUT
NEED NOT BE LIMITED TO, A REVIEW OF:

(I) ALL RECORDS REQUIRED TO BE MADE, KEPT, AND MADE AVAILABLE TO
CUSTOMS BY THE IMPORTER, THE PRODUCER, THE ENTITY CONTROLLING
PRODUCTION, OR ANY OTHER PERSON UNDER PART 19 C.F.R. 163;

(II) DOCUMENTATION AND OTHER INFORMATION REGARDING ALL ARTICLES
DESCRIBED IN THE ACT THAT WERE PRODUCED AND EXPORTED TO THE
UNITED STATES AND ENTERED DURING THE PREFERENCE YEAR IN
QUESTION, WHETHER OR NOT A CLAIM FOR PREFERENTIAL TREATMENT
WAS MADE. THOSE RECORDS AND OTHER INFORMATION INCLUDE, BUT
ARE NOT LIMITED TO, WORK ORDERS AND OTHER PRODUCTION RECORDS,
PURCHASE ORDERS, INVOICES, BILLS OF LADING AND OTHER SHIPPING
DOCUMENTS;

(III) EVIDENCE TO DOCUMENT THE COST OF FABRIC COMPONENTS FORMED IN
THE UNITED STATES THAT WERE USED IN THE PRODUCTION OF THE
ARTICLES IN QUESTION, SUCH AS PURCHASE ORDERS, INVOICES,
BILLS OF LADING AND OTHER SHIPPING DOCUMENTS, AND CUSTOMS
IMPORT AND CLEARANCE DOCUMENTS, WORK ORDERS AND OTHER
PRODUCTION RECORDS, AND INVENTORY CONTROL RECORDS;

(IV) EVIDENCE TO DOCUMENT THE COST OR VALUE OF ALL FABRIC OTHER
THAN FABRIC COMPONENTS FORMED IN THE UNITED STATES THAT WERE
USED IN THE PRODUCTION OF THE ARTICLES IN QUESTION, SUCH AS
PURCHASE ORDERS, INVOICES, BILLS OF LADING AND OTHER SHIPPING
DOCUMENTS, AND CUSTOMS IMPORT AND CLEARANCE DOCUMENTS, WORK
ORDERS AND OTHER PRODUCTION RECORDS, AND INVENTORY CONTROL
RECORDS; AND

(V) ACCOUNTING BOOKS AND DOCUMENTS TO VERIFY THE RECORDS AND
INFORMATION REFERENCED ABOVE. THE VERIFICATION OF PURCHASE
ORDERS, INVOICES AND BILLS OF LADING WILL BE ACCOMPLISHED
THROUGH THE REVIEW OF A DISTINCT AUDIT TRAIL. THE AUDIT
TRAIL DOCUMENTS MUST CONSIST OF A CASH DISBURSEMENT OR
PURCHASE JOURNAL OR EQUIVALENT RECORDS TO ESTABLISH THE
PURCHASE OF THE FABRIC OR COMPONENT. THE HEADINGS IN EACH OF
THESE JOURNALS OR OTHER RECORDS MUST CONTAIN THE DATE, VENDOR
NAME, AND AMOUNT PAID FOR THE FABRIC OR COMPONENT. THE
VERIFICATION OF PRODUCTION RECORDS AND WORK ORDERS WILL BE
ACCOMPLISHED THROUGH ANALYSIS OF THE INVENTORY RECORDS OF THE
PRODUCER OR ENTITY CONTROLLING PRODUCTION. THE INVENTORY
RECORDS MUST IDENTIFY THE DATE OF PRODUCTION OF THE FINISHED
ARTICLE, WHICH MUST BE REFERENCED TO THE ORIGINAL PURCHASE
ORDER OR LOT NUMBER COVERING THE FABRIC OR COMPONENT USED IN
PRODUCTION. IN THE INVENTORY PRODUCTION RECORDS, THE
INVENTORY SHOULD SHOW THE OPENING BALANCE OF THE INVENTORY
PLUS THE PURCHASES MADE DURING THE YEAR AND THE INVENTORY
CLOSING BALANCE.

IF, BASED ON A VERIFICATION OF A DECLARATION OF COMPLIANCE FILED
UNDER THIS SECTION, CUSTOMS DETERMINES THAT THE APPLICABLE 75 OR
85 PERCENT STANDARD WAS NOT MET, CUSTOMS WILL PUBLISH A NOTICE
OF THAT DETERMINATION IN THE FEDERAL REGISTER.

POST ENTRY CLAIMS

IMPORTERS THAT HAVE ENTERED BRASSIERES AT THE NORMAL DUTY RATES
THAT COULD NOT MAKE A CLAIM BECAUSE THE IDENTIFIER CODE WAS NOT
AVAILABLE FROM THE PRODUCER OR THE ENTITY CONTROLLING PRODUCTION
CAN AVAIL THEMSELVES OF ALL AVAILABLE POST ENTRY PROCEDURES WITH
THE EXCEPTION OF NAFTA 520(D).

ACTION:

1) AFTER A PRODUCER OR ENTITY CONTROLLING PRODUCTION RECEIVES
THE UNIQUE IDENTIFIER NUMBER, IT WILL BE THEIR RESPONSIBILITY
TO PROVIDE THIS NUMBER TO IMPORTERS. A GRACE PERIOD WILL BE
PROVIDED UNTIL NOVEMBER 15, 2001, TO ALLOW FOR IMPORTERS TO
OBTAIN THE UNIQUE IDENTIFIER NUMBER. AFTER THAT DATE,
IMPORTERS MUST SUBMIT THIS NUMBER ON THE ENTRY WHEN
PREFERENCE IS BEING CLAIMED.

2) IMPORTERS THAT HAVE ENTERED BRASSIERES AT THE NORMAL DUTY
RATES AND COULD NOT MAKE A CLAIM BECAUSE THE IMPORTER DID NOT
OBTAIN THE IDENTIFIER CODE FROM THE PRODUCER CAN AVAIL
THEMSELVES OF ALL THE AVAILABLE POST ENTRY PROCEDURES WITH
THE EXCEPTION OF NAFTA 520 (D). PORTS SHOULD PROCESS THESE
CLAIMS PROMPTLY SINCE NO VERIFICATION OF CLAIMS, UNDER THIS
PROVISION ONLY, IS COMPLETED AT THE PORT LEVEL. VERIFICATION
OF CLAIMS CANNOT BE DONE ON AN ENTRY BY ENTRY BASIS.
VERIFYING THE VALIDITY OF CLAIMS MUST BE ACCOMPLISHED THROUGH
AN AUDIT PROCEDURE.

INFORMATION:

IF YOU HAVE ANY QUESTIONS CONCERNING THIS ADMINISTRATIVE NOTICE,
PLEASE CALL SUSAN THOMAS AT (202) 927-3719, OR ROBERT ABELS AT
(202) 927-1959.

\S\
ELIZABETH G. DURANT

CC: EXECUTIVE DIRECTOR, FIELD OPERATIONS

Referenced By

CSMS #02-000387