19 U.S.C. § 3722 — Protections against transshipment

Page 902 TITLE 19—CUSTOMS DUTIES § 3722 more beneficiary sub-Saharan African countries from yarn originating either in the United States or one or more beneficiary sub-Saharan African countries (in- cluding fabrics not formed from yarns, if such fabrics are classifiable under heading 5602 or 5603 of the Har- monized Tariff Schedule of the United States and are wholly formed and cut in one or more beneficiary sub- Saharan African countries), subject to the following:’’. Subsec. (b)(3)(B). Pub. L. 107–210, § 3108(a)(3)(B), amended heading and text generally. Prior to amend- ment, text read as follows: ‘‘(i) IN GENERAL.—Subject to subparagraph (A), pref- erential treatment shall be extended through Sep- tember 30, 2004, for apparel articles wholly assembled in one or more lesser developed beneficiary sub-Saharan African countries regardless of the country of origin of the fabric used to make such articles. ‘‘(ii) LESSER DEVELOPED BENEFICIARY SUB-SAHARAN AF- RICAN COUNTRY.—For purposes of this subparagraph the term ‘lesser developed beneficiary sub-Saharan African country’ means a beneficiary sub-Saharan African country that had a per capita gross national product of less than $1,500 a year in 1998, as measured by the World Bank.’’ Subsec. (b)(4)(B). Pub. L. 107–210, § 3108(a)(4), sub- stituted ‘‘21.5 microns’’ for ‘‘18.5 microns’’. Subsec. (b)(7). Pub. L. 107–210, § 3108(a)(5), added par. (7). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2020 AMENDMENT Amendment by Pub. L. 116–260 effective July 1, 2020, see section 602(g) of div. O of Pub. L. 116–260, set out as a note under section 2578b of this title. EFFECTIVE DATE OF 2008 AMENDMENT Pub. L. 110–436, § 3(b), Oct. 16, 2008, 122 Stat. 4980, pro- vided that: ‘‘The amendments made by subsection (a) [amending this section] apply to goods entered, or withdrawn from warehouse for consumption, on or after the 15th day after the date of the enactment of this Act [Oct. 16, 2008].’’ EFFECTIVE DATE OF 2004 AMENDMENT Pub. L. 108–429, title II, § 2004(k)(2), Dec. 3, 2004, 118 Stat. 2595, provided that: ‘‘Notwithstanding section 514 of the Tariff Act of 1930 (19 U.S.C. 1514) or any other provision of law, upon proper request filed with the Bu- reau of Customs and Border Protection before the 90th day after the date of the enactment of this Act [Dec. 3, 2004], any entry, or withdrawal from warehouse for con- sumption, of any good— ‘‘(A) that was made on or after October 1, 2004, and before the date of the enactment of this Act, and ‘‘(B) with respect to which there would have been no duty if the amendment made by this subsection applied to such entry or withdrawal, shall be liquidated or reliquidated as if such amend- ment applied to such entry or withdrawal.’’ TRANSFER OF FUNCTIONS For transfer of functions, personnel, assets, and li- abilities of the United States Customs Service of the Department of the Treasury, including functions of the Secretary of the Treasury relating thereto, to the Sec- retary of Homeland Security, and for treatment of re- lated references, see sections 203(1), 551(d), 552(d), and 557 of Title 6, Domestic Security, and the Department of Homeland Security Reorganization Plan of Novem- ber 25, 2002, as modified, set out as a note under section 542 of Title 6. For establishment of U.S. Customs and Border Protection in the Department of Homeland Se- curity, treated as if included in Pub. L. 107–296 as of Nov. 25, 2002, see section 211 of Title 6, as amended gen- erally by Pub. L. 114–125, and section 802(b) of Pub. L. 114–125, set out as a note under section 211 of Title 6. INCREASE IN LIMITATION ON CERTAIN BENEFITS Pub. L. 107–210, div. C, title XXXI, § 3108(b), Aug. 6, 2002, 116 Stat. 1039, provided that: ‘‘The applicable per- centage under clause (ii) of section 112(b)(3)(A) of the African Growth and Opportunity Act (19 U.S.C. 3721(b)(3)(A)) shall be increased— ‘‘(1) by 2.17 percent for the 1-year period beginning on October 1, 2002, and ‘‘(2) by equal increments in each succeeding 1-year period provided for in such clause, so that for the 1- year period beginning October 1, 2007, the applicable percentage is increased by 3.5 percent, except that such increase shall not apply with respect to articles eligible under subparagraph (B) of section 112(b)(3) of that Act.’’ Executive Documents DELEGATION OF AUTHORITY For delegation of certain authority of the President under this section to the Committee for the Implemen- tation of Textile Agreements and the United States Trade Representative, see Ex. Ord. No. 13191, §§ 1–3, Jan. 17, 2001, 66 F.R. 7271, set out as a note under section 2703 of this title. PROC. NO. 7350. TO IMPLEMENT THE AFRICAN GROWTH AND OPPORTUNITY ACT AND TO DESIGNATE ERITREA AS A BENEFICIARY DEVELOPING COUNTRY FOR PURPOSES OF THE GENERALIZED SYSTEM OF PREFERENCES Proc. No. 7350, Oct. 2, 2000, 65 F.R. 59321, provided in par. (5) that the United States Trade Representative is authorized to determine whether Kenya and Mauritius have satisfied the requirements of section 3721(c)[d] of this title, is directed to set forth the determination in a notice to be published in the Federal Register and to cause the existing quotas on textile and apparel arti- cles imported into the United States from such country to be eliminated within 30 days after the determina- tion, and is authorized to exercise the authority pro- vided to the President under section 2483 of this title to embody modifications and technical or conforming changes in the Harmonized Tariff Schedule of the United States. § 3722. Protections against transshipment (a) Preferential treatment conditioned on en- forcement measures (1) In general The preferential treatment under section 3721(a) of this title shall not be provided to textile and apparel articles that are imported from a beneficiary sub-Saharan African coun- try unless that country— (A) has adopted an effective visa system, domestic laws, and enforcement procedures applicable to covered articles to prevent un- lawful transshipment of the articles and the use of counterfeit documents relating to the importation of the articles into the United States; (B) has enacted legislation or promulgated regulations that would permit United States Customs Service verification teams to have the access necessary to investigate thor- oughly allegations of transshipment through such country; (C) agrees to report, on a timely basis, at the request of the United States Customs Service, on the total exports from and im- ports into that country of covered articles, consistent with the manner in which the records are kept by that country; (D) will cooperate fully with the United States to address and take action necessary to prevent circumvention as provided in Ar- ticle 5 of the Agreement on Textiles and Clothing; Page 903 TITLE 19—CUSTOMS DUTIES § 3722 1 See References in Text note below. (E) agrees to require all producers and ex- porters of covered articles in that country to maintain complete records of the production and the export of covered articles, including materials used in the production, for at least 2 years after the production or export (as the case may be); and (F) agrees to report, on a timely basis, at the request of the United States Customs Service, documentation establishing the country of origin of covered articles as used by that country in implementing an effec- tive visa system. (2) Country of origin documentation For purposes of paragraph (1)(F), docu- mentation regarding the country of origin of the covered articles includes documentation such as production records, information relat- ing to the place of production, the number and identification of the types of machinery used in production, the number of workers em- ployed in production, and certification from both the manufacturer and the exporter. (b) Customs procedures and enforcement (1) In general (A) Regulations Any importer that claims preferential treatment under section 3721 of this title shall comply with customs procedures simi- lar in all material respects to the require- ments of article 5.4.1 of the USMCA as im- plemented pursuant to United States law, in accordance with regulations promulgated by the Secretary of the Treasury. (B) Determination (i) In general In order to qualify for the preferential treatment under section 3721 of this title and for a Certificate of Origin to be valid with respect to any article for which such treatment is claimed, there shall be in ef- fect a determination by the President that each country described in clause (ii)— (I) has implemented and follows; or (II) is making substantial progress to- ward implementing and following, procedures and requirements similar in all material respects to the relevant proce- dures and requirements under chapter 5 of the USMCA. (ii) Country described A country is described in this clause if it is a beneficiary sub-Saharan African coun- try— (I) from which the article is exported; or (II) in which materials used in the pro- duction of the article originate or in which the article or such materials, un- dergo production that contributes to a claim that the article is eligible for pref- erential treatment. (2) Certificate of Origin The Certificate of Origin that otherwise would be required pursuant to the provisions of paragraph (1) shall not be required in the case of an article imported under section 3721 of this title if such Certificate of Origin would not be required under article 5.5 of the USMCA (as implemented pursuant to United States law), if the article were imported from Mexico. (3) Penalties for exporters If the President determines, based on suffi- cient evidence, that an exporter has engaged in transshipment as defined in paragraph (4), then the President shall deny for a period of 5 years all benefits under section 3721 of this title to such exporter, any successor of such exporter, and any other entity owned or oper- ated by the principal of the exporter. (4) Transshipment described Transshipment within the meaning of this subsection has occurred when preferential treatment for a textile or apparel article under this chapter 1 has been claimed on the basis of material false information concerning the country of origin, manufacture, proc- essing, or assembly of the article or any of its components. For purposes of this paragraph, false information is material if disclosure of the true information would mean or would have meant that the article is or was ineli- gible for preferential treatment under section 3721 of this title. (5) Monitoring and reports to Congress The Customs Service shall monitor and the Commissioner of U.S. Customs and Border Protection shall submit to Congress, not later than March 31 of each year, a report on the ef- fectiveness of the visa systems and the imple- mentation of legislation and regulations de- scribed in subsection (a) and on measures taken by countries in sub-Saharan Africa which export textiles or apparel to the United States to prevent circumvention as described in Article 5 of the Agreement on Textiles and Clothing. (c) Customs Service enforcement The Customs Service shall— (1) make available technical assistance to the beneficiary sub-Saharan African coun- tries— (A) in the development and implementa- tion of visa systems, legislation, and regula- tions described in subsection (a)(1)(A); and (B) to train their officials in anti-trans- shipment enforcement; (2) send production verification teams to at least four beneficiary sub-Saharan African countries each year; and (3) to the extent feasible, place beneficiary sub-Saharan African countries on the Elec- tronic Visa (ELVIS) program. (d) Authorization of appropriations There is authorized to be appropriated to carry out subsection (c) the sum of $5,894,913. (Pub. L. 106–200, title I, § 113, May 18, 2000, 114 Stat. 263; Pub. L. 114–125, title VIII, § 802(d)(2), Feb. 24, 2016, 130 Stat. 210; Pub. L. 116–260, div. O, title VI, § 602(a)(2), Dec. 27, 2020, 134 Stat. 2152.) Page 904 TITLE 19—CUSTOMS DUTIES § 3723 Editorial Notes REFERENCES IN TEXT This chapter, referred to in subsec. (b)(4), was in the original ‘‘this Act’’, and was translated as reading ‘‘this title’’, meaning title I of Pub. L. 106–200, May 18, 2000, 114 Stat. 252, which is classified principally to this chapter, to reflect the probable intent of Congress. For complete classification of title I to the Code, see Short Title note set out under section 3701 of this title and Tables. AMENDMENTS 2020—Subsec. (b)(1)(A). Pub. L. 116–260, § 602(a)(2)(A)(i), substituted ‘‘article 5.4.1 of the USMCA’’ for ‘‘Article 502(1) of the NAFTA’’. Subsec. (b)(1)(B)(i). Pub. L. 116–260, § 602(a)(2)(A)(ii), substituted ‘‘chapter 5 of the USMCA’’ for ‘‘chapter 5 of the NAFTA’’ in concluding provisions. Subsec. (b)(2). Pub. L. 116–260, § 602(a)(2)(B), sub- stituted ‘‘article 5.5 of the USMCA’’ for ‘‘Article 503 of the NAFTA’’. Statutory Notes and Related Subsidiaries CHANGE OF NAME ‘‘Commissioner of U.S. Customs and Border Protec- tion’’ substituted for ‘‘Commissioner of Customs’’ in subsec. (b)(5) on authority of section 802(d)(2) of Pub. L. 114–125, set out as a note under section 211 of Title 6, Domestic Security. EFFECTIVE DATE OF 2020 AMENDMENT Amendment by Pub. L. 116–260 effective July 1, 2020, see section 602(g) of div. O of Pub. L. 116–260, set out as a note under section 2578b of this title. TRANSFER OF FUNCTIONS For transfer of functions, personnel, assets, and li- abilities of the United States Customs Service of the Department of the Treasury, including functions of the Secretary of the Treasury relating thereto, to the Sec- retary of Homeland Security, and for treatment of re- lated references, see sections 203(1), 551(d), 552(d), and 557 of Title 6, Domestic Security, and the Department of Homeland Security Reorganization Plan of Novem- ber 25, 2002, as modified, set out as a note under section 542 of Title 6. For establishment of U.S. Customs and Border Protection in the Department of Homeland Se- curity, treated as if included in Pub. L. 107–296 as of Nov. 25, 2002, see section 211 of Title 6, as amended gen- erally by Pub. L. 114–125, and section 802(b) of Pub. L. 114–125, set out as a note under section 211 of Title 6. Executive Documents DELEGATION OF AUTHORITY Authority of President under subsec. (b)(3) of this section delegated to the Committee for the Implemen- tation of Textile Agreements by section 4 of Ex. Ord. No. 13191, Jan. 17, 2001, 66 F.R. 7271, set out as a note under section 2703 of this title. PROC. NO. 7350. TO IMPLEMENT THE AFRICAN GROWTH AND OPPORTUNITY ACT AND TO DESIGNATE ERITREA AS A BENEFICIARY DEVELOPING COUNTRY FOR PURPOSES OF THE GENERALIZED SYSTEM OF PREFERENCES Proc. No. 7350, Oct. 2, 2000, 65 F.R. 59321, provided in par. (4) that the United States Trade Representative is authorized to determine whether each designated bene- ficiary sub-Saharan African country has satisfied the requirements of section 3722(a) of this title, relating to the establishment of procedures to protect against un- lawful transshipments and section 3722(b)(1)(B) of this title relating to the implementation of procedures and requirements similar in all material respects to the rel- evant procedures and requirements under chapter 5 of the North American Free Trade Agreement (NAFTA), is directed to set forth the determination in a notice to be published in the Federal Register which notice shall modify the Harmonized Tariff Schedule of the United States (HTS) by listing the countries that satisfy the requirements of sections 3722(a) and 3722(b)(1)(B) of this title, and is authorized to exercise the authority pro- vided to the President under section 2483 of this title to embody modifications and technical or conforming changes in the HTS. § 3723. Free trade agreements with sub-Saharan African countries (a) Declaration of policy Congress declares that free trade agreements should be negotiated, where feasible, with inter- ested countries in sub-Saharan Africa, in order to serve as the catalyst for increasing trade be- tween the United States and sub-Saharan Africa and increasing private sector investment in sub- Saharan Africa. (b) Plan requirement (1) In general The President, taking into account the pro- visions of the treaty establishing the African Economic Community and the willingness of the governments of sub-Saharan African coun- tries to engage in negotiations to enter into free trade agreements, shall develop a plan for the purpose of negotiating and entering into one or more trade agreements with interested beneficiary sub-Saharan African countries. (2) Elements of plan The plan shall include the following: (A) The specific objectives of the United States with respect to negotiations de- scribed in paragraph (1) and a suggested timetable for achieving those objectives. (B) The benefits to both the United States and the relevant sub-Saharan African coun- tries with respect to the applicable free trade agreement or agreements. (C) A mutually agreed-upon timetable for the negotiations. (D) The implications for and the role of re- gional and sub-regional organizations in sub- Saharan Africa with respect to such free trade agreement or agreements. (E) Subject matter anticipated to be cov- ered by the negotiations and United States laws, programs, and policies, as well as the laws of participating eligible African coun- tries and existing bilateral and multilateral and economic cooperation and trade agree- ments, that may be affected by the agree- ment or agreements. (F) Procedures to ensure the following: (i) Adequate consultation with the Con- gress and the private sector during the ne- gotiations. (ii) Consultation with the Congress re- garding all matters relating to implemen- tation of the agreement or agreements. (iii) Approval by the Congress of the agreement or agreements. (iv) Adequate consultations with the rel- evant African governments and African re- gional and subregional intergovernmental organizations during the negotiation of the agreement or agreements.