§ 1508. Recordkeeping

Legislative history

Reconstructed from this section’s Code source credit and amendment notes, resolved against the local Statutes at Large. Editorial notes are evidence, not the law that made the change.

1. 1930

   Customs Procedural Reform and Simplification Act of 1978

   Pub. L. 95–410 title I § 104 · 92 Stat. 888

   Enacted · 19 U.S.C. § 1508

   June 17, 1930, ch. 497, title IV, § 508, as added Pub. L. 95–410, title I, § 104, Oct. 3, 1978, 92 Stat. 889

   Source evidence

   Code source credit
   June 17, 1930, ch. 497, title IV, § 508, as added Pub. L. 95–410, title I, § 104, Oct. 3, 1978, 92 Stat. 889

   Enacted provision · exact public law section
   Sec. 104. The Tariff Act of 1930 is amended by inserting after section 507 the following new section: “SEC. 508. RECORDKEEPING. “(a) Requirements.— Any owner, importer, consignee, or agent thereof who imports, or who knowingly causes to be imported, any merchandise into the customs territory of the United States shall make, keep, and render for examination and inspection such records (including statements, declarations, and other documents) which— “(1) pertain to any such importation, or to the information contained in the documents required by this Act in connection with the entry of merchandise; and “(2) are normally kept in the ordinary course of business. “(b) Period of Time.— The records required by subsection (a) of this section shall be kept for such periods of time, not to exceed 5 years from the date of entry, as the Secretary shall prescribe. “(c) Limitation.— For the purposes of this section and section 509, Infra. a person ordering merchandise from an importer in a domestic transaction does not knowingly cause merchandise to be imported unless— “(1) the terms and conditions of the importation are controlled by the person placing the order; or “(2) technical data, molds, equipment, other production assistance, material, components, or parts are furnished by the person placing the order with knowledge that they will be used in the manufacture or production of the imported merchandise.”.

2. 1988

   United States-Canada Free-Trade Agreement Implementation Act of 1988

   Pub. L. 100–449 title II § 205(b) · 102 Stat. 1851

   1. Added · 19 U.S.C. § 1508(b)(e)

      Pub. L. 100–449 temporarily added subsec. (b)

   2. Redesignated · 19 U.S.C. § 1508(b)(e)

      Pub. L. 100–449 temporarily redesignated former subsec. (b) as (c)

   3. Inserted · 19 U.S.C. § 1508(b)(e)

      Pub. L. 100–449 temporarily inserted “and (b)” after “subsection (a)”

   4. Redesignated · 19 U.S.C. § 1508(b)(e)

      Pub. L. 100–449 temporarily redesignated former subsec. (c) as (d)

   5. Added · 19 U.S.C. § 1508(b)(e)

      Pub. L. 100–449 temporarily added subsec. (e). See Effective and Termination Dates of 1988 Amendment note below

   Source evidence

   Code amendment note
   Subsecs. (b) to (e). Pub. L. 100–449 temporarily added subsec. (b), redesignated former subsec. (b) as (c) and inserted “and (b)” after “subsection (a)”, redesignated former subsec. (c) as (d), and added subsec. (e). See Effective and Termination Dates of 1988 Amendment note below.

   Enacted provision · exact public law section
   (b) Recordkeeping Requirements.— Section 508 of the Tariff Act of 1930 (19 U.S.C. 1508) is amended— (1) by redesignating subsections (b) and (c) as subsections (c) and (d), respectively; (2) by inserting “and (b)” after “(a)” in subsection (c), as so redesignated; (3) by adding after subsection (a) the following new subsection: “(b) Any person who exports, or who knowingly causes to be exported, any merchandise to Canada shall make, keep, and render for examination and inspection such records (including certifications of origin or copies thereof) which pertain to such exportations.”; and (4) by adding at the end thereof the following new subsection: “(e) Any person who fails to retain records required by subsection (b) or the regulations issued to implement that subsection shall be liable to a civil penalty not to exceed $10,000.”.

3. 1993

   North American Free Trade Agreement Implementation Act

   Pub. L. 103–182 § 614(1) · 107 Stat. 2057

   Amended · 19 U.S.C. § 1508(a)

   Pub. L. 103–182, § 614(1), amended subsec. (a) generally. Prior to amendment, subsec. (a) read as follows: “Any owner, importer, consignee, or agent thereof who imports, or who knowingly causes to be imported, any merchandise into the customs territory of the United States shall make, keep, and render for examination and inspection such records (including statements, declarations, and other documents) which—

   Source evidence

   Code amendment note
   Subsec. (a). Pub. L. 103–182, § 614(1), amended subsec. (a) generally. Prior to amendment, subsec. (a) read as follows: “Any owner, importer, consignee, or agent thereof who imports, or who knowingly causes to be imported, any merchandise into the customs territory of the United States shall make, keep, and render for examination and inspection such records (including statements, declarations, and other documents) which—

   “(1) pertain to any such importation, or to the information contained in the documents required by this chapter in connection with the entry of merchandise; and “(2) are normally kept in the ordinary course of business.”

   Enacted provision · exact public law section
   (1) by amending subsection (a) to read as follows: “(a) Requirements.— Any— “(1) owner, importer, consignee, importer of record, entry filer, or other party who— “(A) Claims. imports merchandise into the customs territory of the United States, files a drawback claim, or transports or stores merchandise carried or held under bond, or “(B) knowingly causes the importation or transportation or storage of merchandise carried or held under bond into or from the customs territory of the United States; “(2) agent of any party described in paragraph (1); or “(3) person whose activities require the filing of a declaration or entry, or both; shall make, keep, and render for examination and inspection records (which for purposes of this section include, but are not limited to, statements, declarations, documents and electronically generated or machine readable data) which— “(A) pertain to any such activity, or to the information contained in the records required by this Act in connection with any such activity; and “(B) are normally kept in the ordinary course of business.”; and

4. 1993

   North American Free Trade Agreement Implementation Act

   Pub. L. 103–182 § 205(a)(1) · 107 Stat. 2057

   Amended · 19 U.S.C. § 1508(b)

   Pub. L. 103–182, § 205(a)(1), amended subsec. (b) generally. Prior to amendment, subsec. (b) read as follows: “Any person who exports, or who knowingly causes to be exported, any merchandise to Canada shall make, keep, and render for examination and inspection such records (including certifications of origin or copies thereof) which pertain to such exportations.”

   Source evidence

   Code amendment note
   Subsec. (b). Pub. L. 103–182, § 205(a)(1), amended subsec. (b) generally. Prior to amendment, subsec. (b) read as follows: “Any person who exports, or who knowingly causes to be exported, any merchandise to Canada shall make, keep, and render for examination and inspection such records (including certifications of origin or copies thereof) which pertain to such exportations.”

   Enacted provision · exact public law section
   (1) Subsection (b) is amended to read as follows: “(b) Exportations to Free Trade Countries.— “(1) Definitions.— As used in this subsection— “(A) The term ‘associated records’ means, in regard to an exported good under paragraph (2), records associated with— “(i) the purchase of, cost of, value of, and payment for, the good; “(ii) the purchase of, cost of, value of, and payment for, all material, including indirect materials, used in the production of the good; and “(iii) the production of the good. For purposes of this subparagraph, the terms ‘indirect material’, ‘material’, ‘preferential tariff treatment’, ‘used’, and ‘value’ have the respective meanings given them in articles 415 and 514 of the North American Free Trade Agreement. “(B) The term ‘NAFTA Certificate of Origin’ means the certification, established under article 501 of the North American Free Trade Agreement, that a good qualifies as an originating good under such Agreement. “(2) Exports to nafta countries.— “(A) In general.— Any person who completes and signs a NAFTA Certificate of Origin for a good for which preferential treatment under the North American Free Trade Agreement is claimed shall make, keep, and render for examination and inspection all records relating to the origin of the good (including the Certificate or copies thereof) and the associated records. “(B) Claims for certain waivers, reductions, or refunds of duties or for credit against bonds.— “(i) In general.— Any person that claims with respect to an article— “(I) a waiver or reduction of duty under the last paragraph of section 311, section 312(b) (1) or (4), section 562(2), or the last proviso to section 3(a) of the Foreign Trade Zones Act; “(II) a credit against a bond under section 312(d); or “(III) a refund, waiver, or reduction of duty under section 313 (n)(2) or (o)(1); must disclose to the Customs Service the information described in clause (ii). “(ii) Information required.—Within 30 days after making a claim described in clause (i) with respect to an article, the person making the claim must disclose to the Customs Service whether that person has prepared, or has knowledge that another person has prepared, a NAFTA Certificate of Origin for the article. If after such 30-day period the person making the claim either— “(I) prepares a NAFTA Certificate of Origin for the article; or “(II) learns of the existence of such a Certificate for the article; that person, within 30 days after the occurrence described in subclause (I) or (II), must disclose the occurrence to the Customs Service. “(iii) Action on claim.— If the Customs Service determines that a NAFTA Certificate of Origin has been prepared with respect to an article for which a claim described in clause (i) is made, the Customs Service may make such adjustments regarding the previous customs treatment of the article as may be warranted. “(3) Exports under the Canadian agreement.— Any person who exports, or who knowingly causes to be exported, any merchandise to Canada during such time as the United States-Canada Free-Trade Agreement is in force with respect to, and the United States applies that Agreement to, Canada shall make, keep, and render for examination and inspection such records (including certifications of origin or copies thereof) which pertain to the exportations.”.

5. 1993

   North American Free Trade Agreement Implementation Act

   Pub. L. 103–182 § 205(a)(2) · 107 Stat. 2057

   Amended · 19 U.S.C. § 1508(c)

   Pub. L. 103–182, § 205(a)(2), amended generally subsec. (c), as amended by Pub. L. 103–182, § 614(2) (see below). Prior to amendment, subsec. (c) read as follows: “The records required by subsections (a) and (b) of this section shall be kept for such period of time, not to exceed 5 years from the date of entry or exportation, as appropriate, as the Secretary shall prescribe; except that records for any drawback claim shall be kept until the 3rd anniversary of the date of payment of the claim.” See Construction of 1993 Amendment note below

   Source evidence

   Code amendment note
   Subsec. (c). Pub. L. 103–182, § 205(a)(2), amended generally subsec. (c), as amended by Pub. L. 103–182, § 614(2) (see below). Prior to amendment, subsec. (c) read as follows: “The records required by subsections (a) and (b) of this section shall be kept for such period of time, not to exceed 5 years from the date of entry or exportation, as appropriate, as the Secretary shall prescribe; except that records for any drawback claim shall be kept until the 3rd anniversary of the date of payment of the claim.” See Construction of 1993 Amendment note below.

   Enacted provision · exact public law section
   (2) Subsection (c) is amended to read as follows: “(c) Period of Time.— The records required by subsections (a) and (b) shall be kept for such periods of time as the Secretary shall prescribe; except that— “(1) no period of time for the retention of the records required under subsection (a) or (b)(3) may exceed 5 years from the date of entry or exportation, as appropriate; “(2) the period of time for the retention of the records required under subsection (b)(2) shall be at least 5 years from the date of signature of the NAFTA Certificate of Origin; and “(3) records for any drawback claim shall be kept until the 3rd anniversary of the date of payment of the claim.”.

6. 1993

   North American Free Trade Agreement Implementation Act

   Pub. L. 103–182 § 614(2) · 107 Stat. 2057

   Amended · 19 U.S.C. § 1508(c)

   Pub. L. 103–182, § 614(2), amended subsec. (c) generally. Prior to amendment, subsec. (c) read as follows: “The records required by subsection (a) and (b) of this section shall be kept for such periods of time, not to exceed 5 years from the date of entry, as the Secretary shall prescribe.” See Construction of 1993 Amendment note below

   Target inherited from the preceding amendment note.

   Source evidence

   Code amendment note
   Pub. L. 103–182, § 614(2), amended subsec. (c) generally. Prior to amendment, subsec. (c) read as follows: “The records required by subsection (a) and (b) of this section shall be kept for such periods of time, not to exceed 5 years from the date of entry, as the Secretary shall prescribe.” See Construction of 1993 Amendment note below.

   Enacted provision · exact public law section
   (2) by amending subsection (c) to read as follows: “(c) Period of Time.— The records required by subsections (a) Claims. Claims, and (b) shall be kept for such period of time, not to exceed 5 years from the date of entry or exportation, as appropriate, as the Secretary shall prescribe; except that records for any drawback claim shall be kept until the 3rd anniversary of the date of payment of the claim.”.

7. 1993

   North American Free Trade Agreement Implementation Act

   Pub. L. 103–182 § 205(a)(3) · 107 Stat. 2057

   Amended · 19 U.S.C. § 1508(e)

   Pub. L. 103–182, § 205(a)(3), amended subsec. (e) generally. Prior to amendment, subsec. (e) read as follows: “Any person who fails to retain records required by subsection (b) of this section or the regulations issued to implement that subsection shall be liable to a civil penalty not to exceed $10,000.”

   Source evidence

   Code amendment note
   Subsec. (e). Pub. L. 103–182, § 205(a)(3), amended subsec. (e) generally. Prior to amendment, subsec. (e) read as follows: “Any person who fails to retain records required by subsection (b) of this section or the regulations issued to implement that subsection shall be liable to a civil penalty not to exceed $10,000.”

   Enacted provision · exact public law section
   (3) Subsection (e) is amended to read as follows: “(e) Subsection (b) Penalties.— “(1) Relating to nafta exports.— Any person who fails to retain records required by paragraph (2) of subsection (b) or the regulations issued to implement that paragraph shall be liable for— “(A) a civil penalty not to exceed $10,000; or “(B) the general recordkeeping penalty that applies under the customs laws; whichever penalty is higher. “(2) Relating to Canadian agreement exports.— Any person who fails to retain the records required by paragraph (3) of subsection (b) or the regulations issued to implement that paragraph shall be liable for a civil penalty not to exceed $10,000.”.

8. 1996

   Miscellaneous Trade and Technical Corrections Act of 1996

   Pub. L. 104–295 § 3(a)(6)(B) · 110 Stat. 3514

   Inserted · 19 U.S.C. § 1508(c)(1)

   Pub. L. 104–295 inserted “, filing of a reconciliation,” after “entry”

   Source evidence

   Code amendment note
   Subsec. (c)(1). Pub. L. 104–295 inserted “, filing of a reconciliation,” after “entry”.

   Enacted provision · exact public law section
   (B) Section 508(c)(1) of such Act (19 U.S.C. 1508(c)(1)) is amended by inserting “, filing of a reconciliation,” after “entry”.

9. 2003

   United States-Chile Free Trade Agreement Implementation Act

   Pub. L. 108–77 title II · 117 Stat. 909

   Substituted · 19 U.S.C. § 1508(b)

   Pub. L. 108–77, §§ 107(c), 207(1), temporarily substituted “Exportations to NAFTA countries” for “Exportations to free trade countries” in heading. See Effective and Termination Dates of 2003 Amendment note below

   Source evidence

   Code amendment note
   Subsec. (b). Pub. L. 108–77, §§ 107(c), 207(1), temporarily substituted “Exportations to NAFTA countries” for “Exportations to free trade countries” in heading. See Effective and Termination Dates of 2003 Amendment note below.

   Enacted provision · exact public law
   TITLE II— CUSTOMS PROVISIONS SEC. 201. TARIFF MODIFICATIONS. (a) Tariff Modifications Provided for in the Agreement.— (1) Proclamation authority.— The President may proclaim— (A) such modifications or continuation of any duty, (B) such continuation of duty-free or excise treatment, or (C) such additional duties, as the President determines to be necessary or appropriate to carry out or apply articles 3.3, 3.7, 3.9, article 3.20 (8), (9), (10), and (11), and Annex 3.3 of the Agreement. (2) Effect on chilean gsp status.— Notwithstanding section 502(a)(1) of the Trade Act of 1974 (19 U.S.C. 2462(a)(1)), the President shall terminate the designation of Chile as a beneficiary developing country for purposes of title V of the Trade Act of 1974 on the date of entry into force of the Agreement. (b) Other Tariff Modifications.— Subject to the consultation and layover provisions of section 103(a), the President may proclaim— (1) such modifications or continuation of any duty, (2) such modifications as the United States may agree to with Chile regarding the staging of any duty treatment set forth in Annex 3.3 of the Agreement, (3) such continuation of duty-free or excise treatment, or (4) such additional duties, as the President determines to be necessary or appropriate to maintain the general level of reciprocal and mutually advantageous concessions with respect to Chile provided for by the Agreement. (c) Additional Tariffs on Agricultural Safeguard Goods.— (1) In general.— In addition to any duty proclaimed under subsection (a) or (b), and subject to paragraphs (3) through (5), the Secretary of the Treasury shall assess a duty, in the amount prescribed under paragraph (2), on an agricultural safeguard good if the Secretary of the Treasury determines that the unit import price of the good when it enters the United States, determined on an F.O.B. basis, is less than the trigger price indicated for that good in Annex 3.18 of the Agreement or any amendment thereto. (2) Calculation of additional duty.— The amount of the additional duty assessed under this subsection shall be determined as follows: (A) If the difference between the unit import price and the trigger price is less than, or equal to, 10 percent of the trigger price, no additional duty shall be imposed. (B) If the difference between the unit import price and the trigger price is greater than 10 percent, but less than or equal to 40 percent, of the trigger price, the additional duty shall be equal to 30 percent of the difference between the preferential tariff rate and the column 1 general rate of duty imposed under the HTS on like articles at the time the additional duty is imposed. (C) If the difference between the unit import price and the trigger price is greater than 40 percent, but less than or equal to 60 percent, of the trigger price, the additional duty shall be equal to 50 percent of the difference between the preferential tariff rate and the column 1 general rate of duty imposed under the HTS on like articles at the time the additional duty is imposed. (D) If the difference between the unit import price and the trigger price is greater than 60 percent, but less than or equal to 75 percent, of the trigger price, the additional duty shall be equal to 70 percent of the difference between the preferential tariff rate and the column 1 general rate of duty imposed under the HTS on like articles at the time the additional duty is imposed. (E) If the difference between the unit import price and the trigger price is greater than 75 percent of the trigger price, the additional duty shall be equal to 100 percent of the difference between the preferential tariff rate and the column 1 general rate of duty imposed under the HTS on like articles at the time the additional duty is imposed. (3) Exceptions.— No additional duty under this subsection shall be assessed on an agricultural safeguard good if, at the time of entry, the good is subject to import relief under— (A) subtitle A of title III of this Act; or (B) chapter 1 of title II of the Trade Act of 1974 (19 U.S.C. 2251 et seq.). (4) Termination.— This Applicability. subsection shall cease to apply on the date that is 12 years after the date on which the Agreement enters into force. (5) Tariff-rate quotas.— If Applicability. an agricultural safeguard good is subject to a tariff-rate quota, and the in-quota duty rate for the good proclaimed pursuant to subsection (a) or (b) is zero, any additional duty assessed under this subsection shall be applied only to over-quota imports of the good. (6) Notice.— Not Deadline. later than 60 days after the Secretary of the Treasury first assesses additional duties on an agricultural safeguard good under this subsection, the Secretary shall notify the Government of Chile in writing of such action and shall provide to the Government of Chile data supporting the assessment of additional duties. (7) Modification of trigger prices.— Not later than 60 calendar days before agreeing with the Government of Chile pursuant to article 3.18(2)(b) of the Agreement on a modification to a trigger price for a good listed in Annex 3.18 of the Agreement, the President shall notify the Committees on Ways and Means and Agriculture of the House of Representatives and the Committees on Finance and Agriculture of the Senate of the proposed modification and the reasons therefor. (8) Definitions.— In this subsection: (A) Agricultural safeguard good.— The term “agricultural safeguard good” means a good— (i) that qualifies as an originating good under section 202; (ii) that is included in the United States Agricultural Safeguard Product List set forth in Annex 3.18 of the Agreement; and (iii) for which a claim for preferential tariff treatment under the Agreement has been made. (B) F.O.B.— The term “F.O.B.” means free on board, regardless of the mode of transportation, at the point of direct shipment by the seller to the buyer. (C) Unit import price.— The term “unit import price” means the price expressed in dollars per kilogram. (d) Conversion to Ad Valorem Rates.— For purposes of subsections (a) and (b), with respect to any good for which the base rate in the Schedule of the United States to Annex 3.3 of the Agreement is a specific or compound rate of duty, the President may substitute for the base rate an ad valorem rate that the President determines to be equivalent to the base rate. SEC. 202. RULES OF ORIGIN. (a) Originating Goods.— (1) In general.— For purposes of this Act and for purposes of implementing the tariff treatment provided for under the Agreement, except as otherwise provided in this section, a good is an originating good if— (A) the good is wholly obtained or produced entirely in the territory of Chile, the United States, or both; (B) the good— (i) is produced entirely in the territory of Chile, the United States, or both, and (I) each of the nonoriginating materials used in the production of the good undergoes an applicable change in tariff classification specified in Annex 4.1 of the Agreement, or (II) the good otherwise satisfies any applicable regional value-content or other requirements specified in Annex 4.1 of the Agreement; and (ii) satisfies all other applicable requirements of this section; or (C) the good is produced entirely in the territory of Chile, the United States, or both, exclusively from materials described in subparagraph (A) or (B). (2) Simple combination or mere dilution.— A good shall not be considered to be an originating good and a material shall not be considered to be an originating material by virtue of having undergone— (A) simple combining or packaging operations; or (B) mere dilution with water or another substance that does not materially alter the characteristics of the good or material. (b) De Minimis Amounts of Nonoriginating Materials.— (1) In general.— Except as provided in paragraphs (2) and (3), a good that does not undergo a change in tariff classification pursuant to Annex 4.1 of the Agreement is an originating good if— (A) the value of all nonoriginating materials that are used in the production of the good and do not undergo the applicable change in tariff classification does not exceed 10 percent of the adjusted value of the good; (B) the value of such nonoriginating materials is included in the value of nonoriginating materials for any applicable regional value-content requirement; and (C) the good meets all other applicable requirements of this section. (2) Exceptions.— Paragraph (1) does not apply to the following: (A) A nonoriginating material provided for in chapter 4 of the HTS, or a nonoriginating dairy preparation containing over 10 percent by weight of milk solids provided for in subheading 1901.90 or 2106.90 of the HTS, that is used in the production of a good provided for in chapter 4 of the HTS. (B) A nonoriginating material provided for in chapter 4 of the HTS, or nonoriginating dairy preparations containing over 10 percent by weight of milk solids provided for in subheading 1901.90 of the HTS, that are used in the production of the following goods: (i) Infant preparations containing over 10 percent in weight of milk solids provided for in subheading 1901.10 of the HTS. (ii) Mixes and doughs, containing over 25 percent by weight of butterfat, not put up for retail sale, provided for in subheading 1901.20 of the HTS. (iii) Dairy preparations containing over 10 percent by weight of milk solids provided for in subheading 1901.90 or 2106.90 of the HTS. (iv) Goods provided for in heading 2105 of the HTS. (v) Beverages containing milk provided for in subheading 2202.90 of the HTS. (vi) Animal feeds containing over 10 percent by weight of milk solids provided for in subheading 2309.90 of the HTS. (C) A nonoriginating material provided for in heading 0805 of the HTS, or any of subheadings 2009.11.00 through 2009.39 of the HTS, that is used in the production of a good provided for in any of subheadings 2009.11.00 through 2009.39 of the HTS, or in fruit or vegetable juice of any single fruit or vegetable, fortified with minerals or vitamins, concentrated or unconcentrated, provided for in subheading 2106.90 or 2202.90 of the HTS. (D) A nonoriginating material provided for in chapter 15 of the HTS that is used in the production of a good provided for in any of headings 1501.00.00 through 1508, 1512, 1514, and 1515 of the HTS. (E) A nonoriginating material provided for in heading 1701 of the HTS that is used in the production of a good provided for in any of headings 1701 through 1703 of the HTS. (F) A nonoriginating material provided for in chapter 17 of the HTS or in heading 1805.00.00 of the HTS that is used in the production of a good provided for in subheading 1806.10 of the HTS. (G) A nonoriginating material provided for in any of headings 2203 through 2208 of the HTS that is used in the production of a good provided for in heading 2207 or 2208 of the HTS. (H) A nonoriginating material used in the production of a good provided for in any of chapters 1 through 21 of the HTS, unless the nonoriginating material is provided for in a different subheading than the good for which origin is being determined under this section. (3) Goods provided for in chapters 50 through 63 of the hts.— (A) In general.— Except as provided in subparagraph (B), a good provided for in any of chapters 50 through 63 of the HTS that is not an originating good because certain fibers or yarns used in the production of the component of the good that determines the tariff classification of the good do not undergo an applicable change in tariff classification set out in Annex 4.1 of the Agreement, shall be considered to be an originating good if the total weight of all such fibers or yarns in that component is not more than 7 percent of the total weight of that component. (B) Certain textile or apparel goods.— A textile or apparel good containing elastomeric yarns in the component of the good that determines the tariff classification of the good shall be considered to be an originating good only if such yarns are wholly formed in the territory of Chile or the United States. (c) Accumulation.— (1) Originating goods incorporated in goods of other country.— Originating goods or materials of Chile or the United States that are incorporated into a good in the territory of the other country shall be considered to originate in the territory of the other country. (2) Multiple procedures.— A good that is produced in the territory of Chile, the United States, or both, by 1 or more producers, is an originating good if the good satisfies the requirements of subsection (a) and all other applicable requirements of this section. (d) Regional Value-Content.— (1) In general.— For purposes of subsection (a)(2), the regional value-content of a good referred to in Annex 4.1 of the Agreement shall be calculated, at the choice of the person claiming preferential tariff treatment for the good, on the basis of the build-down method described in paragraph (2) or the build-up method described in paragraph (3), unless otherwise provided in Annex 4.1 of the Agreement. (2) Build-down method.— (A) In general.— The regional value-content of a good may be calculated on the basis of the following build-down method:  RVC =AV - VNM× 100  AV     (B) Definitions.— For purposes of subparagraph (A): (i) The term “RVC” means the regional value-content, expressed as a percentage. (ii) The term “AV” means the adjusted value. (iii) The term “VNM” means the value of nonoriginating materials used by the producer in the production of the good. (3) Build-up method.— (A) In general.— The regional value-content of a good may be calculated on the basis of the following build-up method:  RVC =VOM× 100  AV     (B) Definitions.— For purposes of subparagraph (A): (i) The term “RVC” means the regional value-content, expressed as a percentage. (ii) The term “AV” means the adjusted value. (iii) The term “VOM” means the value of originating materials used by the producer in the production of the good. (e) Value of Materials.— (1) In general.— For purposes of calculating the regional value-content of a good under subsection (d), and for purposes of applying the de minimis rules under subsection (b), the value of a material is— (A) in the case of a material that is imported by the producer of the good, the adjusted value of the material with respect to that importation; (B) in the case of a material acquired in the territory in which the good is produced, except for a material to which subparagraph (C) applies, the producer’s price actually paid or payable for the material; (C) in the case of a material provided to the producer without charge, or at a price reflecting a discount or similar reduction, the sum of— (i) all expenses incurred in the growth, production, or manufacture of the material, including general expenses; and (ii) an amount for profit; or (D) in the case of a material that is self-produced, the sum of— (i) all expenses incurred in the production of the material, including general expenses; and (ii) an amount for profit. (2) Further adjustments to the value of materials.— (A) Originating materials.— The following expenses, if not included in the value of an originating material calculated under paragraph (1), may be added to the value of the originating material: (i) The costs of freight, insurance, packing, and all other costs incurred in transporting the material to the location of the producer. (ii) Duties, taxes, and customs brokerage fees on the material paid in the territory of Chile, the United States, or both, other than duties and taxes that are waived, refunded, refundable, or otherwise recoverable, including credit against duty or tax paid or payable. (iii) The cost of waste and spoilage resulting from the use of the material in the production of the good, less the value of renewable scrap or byproduct. (B) Nonoriginating materials.— The following expenses, if included in the value of a nonoriginating material calculated under paragraph (1), may be deducted from the value of the nonoriginating material: (i) The costs of freight, insurance, packing, and all other costs incurred in transporting the material to the location of the producer. (ii) Duties, taxes, and customs brokerage fees on the material paid in the territory of Chile, the United States, or both, other than duties and taxes that are waived, refunded, refundable, or otherwise recoverable, including credit against duty or tax paid or payable. (iii) The cost of waste and spoilage resulting from the use of the material in the production of the good, less the value of renewable scrap or byproducts. (iv) The cost of originating materials used in the production of the nonoriginating material in the territory of Chile or the United States. (f) Accessories, Spare Parts, or Tools.— Accessories, spare parts, or tools delivered with a good that form part of the good’s standard accessories, spare parts, or tools shall be regarded as a material used in the production of the good, if— (1) the accessories, spare parts, or tools are classified with and not invoiced separately from the good; and (2) the quantities and value of the accessories, spare parts, or tools are customary for the good. (g) Fungible Goods and Materials.— (1) In general.— (A) Claim for preferential treatment.— A person claiming preferential tariff treatment for a good may claim that a fungible good or material is originating either based on the physical segregation of each fungible good or material or by using an inventory management method. (B) Inventory management method.— In this subsection, the term “inventory management method” means— (i) averaging; (ii) “last-in, first-out”; (iii) “first-in, first-out”; or (iv) any other method— (I) recognized in the generally accepted accounting principles of the country in which the production is performed (whether Chile or the United States); or (II) otherwise accepted by that country. (2) Election of inventory method.— A person selecting an inventory management method under paragraph (1) for particular fungible goods or materials shall continue to use that method for those goods or materials throughout the fiscal year of that person. (h) Packaging Materials and Containers for Retail Sale.— Packaging materials and containers in which a good is packaged for retail sale, if classified with the good, shall be disregarded in determining whether all nonoriginating materials used in the production of the good undergo the applicable change in tariff classification set out in Annex 4.1 of the Agreement, and, if the good is subject to a regional value-content requirement, the value of such packaging materials and containers shall be taken into account as originating or nonoriginating materials, as the case may be, in calculating the regional value-content of the good. (i) Packing Materials and Containers for Shipment.— Packing materials and containers for shipment shall be disregarded in determining whether— (1) the nonoriginating materials used in the production of the good undergo an applicable change in tariff classification set out in Annex 4.1 of the Agreement; and (2) the good satisfies a regional value-content requirement. (j) Indirect Materials.— An indirect material shall be considered to be an originating material without regard to where it is produced. (k) Transit and Transshipment.— A good that has undergone production necessary to qualify as an originating good under subsection (a) shall not be considered to be an originating good if, subsequent to that production, the good undergoes further production or any other operation outside the territory of Chile or the United States, other than unloading, reloading, or any other process necessary to preserve the good in good condition or to transport the good to the territory of Chile or the United States. (l) Textile and Apparel Goods Classifiable as Goods Put Up in Sets.— Notwithstanding the rules set forth in Annex 4.1 of the Agreement, textile and apparel goods classifiable as goods put up in sets for retail sale as provided for in General Rule of Interpretation 3 of the Harmonized System shall not be considered to be originating goods unless each of the goods in the set is an originating good or the total value of the nonoriginating goods in the set does not exceed 10 percent of the value of the set determined for purposes of assessing customs duties. (m) Application and Interpretation.— In this section: (1) The basis for any tariff classification is the HTS. (2) Records. Any cost or value referred to in this section shall be recorded and maintained in accordance with the generally accepted accounting principles applicable in the territory of the country in which the good is produced (whether Chile or the United States). (n) Definitions.— In this section: (1) Adjusted value.— The term “adjusted value” means the value determined in accordance with articles 1 through 8, article 15, and the corresponding interpretive notes of the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994 referred to in section 101(d)(8) of the Uruguay Round Agreements Act, except that such value may be adjusted to exclude any costs, charges, or expenses incurred for transportation, insurance, and related services incident to the international shipment of the merchandise from the country of exportation to the place of importation. (2) Fungible goods or fungible materials.— The terms “fungible goods” and “fungible materials” mean goods or materials, as the case may be, that are interchangeable for commercial purposes and the properties of which are essentially identical. (3) Generally accepted accounting principles.— The term “generally accepted accounting principles” means the principles, rules, and procedures, including both broad and specific guidelines, that define the accounting practices accepted in the territory of Chile or the United States, as the case may be. (4) Goods wholly obtained or produced entirely in the territory of chile, the united states, or both.— The term “goods wholly obtained or produced entirely in the territory of Chile, the United States, or both” means— (A) mineral goods extracted in the territory of Chile, the United States, or both; (B) vegetable goods, as such goods are defined in the Harmonized System, harvested in the territory of Chile, the United States, or both; (C) live animals born and raised in the territory of Chile, the United States, or both; (D) goods obtained from hunting, trapping, or fishing in the territory of Chile, the United States, or both; (E) goods (fish, shellfish, and other marine life) taken from the sea by vessels registered or recorded with Chile or the United States and flying the flag of that country; (F) goods produced on board factory ships from the goods referred to in subparagraph (E), if such factory ships are registered or recorded with Chile or the United States and fly the flag of that country; (G) goods taken by Chile or the United States or a person of Chile or the United States from the seabed or beneath the seabed outside territorial waters, if Chile or the United States has rights to exploit such seabed; (H) goods taken from outer space, if the goods are obtained by Chile or the United States or a person of Chile or the United States and not processed in the territory of a country other than Chile or the United States; (I) waste and scrap derived from— (i) production in the territory of Chile, the United States, or both; or (ii) used goods collected in the territory of Chile, the United States, or both, if such goods are fit only for the recovery of raw materials; (J) recovered goods derived in the territory of Chile or the United States from used goods, and used in the territory of that country in the production of remanufactured goods; and (K) goods produced in the territory of Chile, the United States, or both, exclusively— (i) from goods referred to in any of subparagraphs (A) through (I), or (ii) from the derivatives of goods referred to in clause (i), at any stage of production. (5) Harmonized system.— The term “Harmonized System” means the Harmonized Commodity Description and Coding System. (6) Indirect material.— The term “indirect material” means a good used in the production, testing, or inspection of a good but not physically incorporated into the good, or a good used in the maintenance of buildings or the operation of equipment associated with the production of a good, including— (A) fuel and energy; (B) tools, dies, and molds; (C) spare parts and materials used in the maintenance of equipment or buildings; (D) lubricants, greases, compounding materials, and other materials used in production or used to operate equipment or buildings; (E) gloves, glasses, footwear, clothing, safety equipment, and supplies; (F) equipment, devices, and supplies used for testing or inspecting the good; (G) catalysts and solvents; and (H) any other goods that are not incorporated into the good but the use of which in the production of the good can reasonably be demonstrated to be a part of that production. (7) Material.— The term “material” means a good that is used in the production of another good, including a part, ingredient, or indirect material. (8) Material that is self-produced.— The term “material that is self-produced” means a material that is an originating good produced by a producer of a good and used in the production of that good. (9) Nonoriginating good or nonoriginating material.— The terms “nonoriginating good” and “nonoriginating material” mean a good or material, as the case may be, that does not qualify as an originating good under this section. (10) Packing materials and containers for shipment.— The term “packing materials and containers for shipment” means the goods used to protect a good during its transportation, and does not include the packaging materials and containers in which a good is packaged for retail sale. (11) Preferential tariff treatment.— The term “preferential tariff treatment” means the customs duty rate that is applicable to an originating good pursuant to chapter 3 of the Agreement. (12) Producer.— The term “producer” means a person who engages in the production of a good in the territory of Chile or the United States. (13) Production.— The term “production” means growing, mining, harvesting, fishing, raising, trapping, hunting, manufacturing, processing, assembling, or disassembling a good. (14) Recovered goods.— (A) In general.— The term “recovered goods” means materials in the form of individual parts that are the result of— (i) the complete disassembly of used goods into individual parts; and (ii) the cleaning, inspecting, testing, or other processing of those parts as necessary for improvement to sound working condition by one or more of the processes described in subparagraph (B), in order for such parts to be assembled with other parts, including other parts that have undergone the processes described in this paragraph, in the production of a remanufactured good. (B) Processes.— The processes referred to in subparagraph (A)(ii) are welding, flame spraying, surface machining, knurling, plating, sleeving, and rewinding. (15) Remanufactured good.— The term “remanufactured good” means an industrial good assembled in the territory of Chile or the United States, that is listed in Annex 4.18 of the Agreement, and— (A) is entirely or partially comprised of recovered goods; (B) has the same life expectancy and meets the same performance standards as a new good; and (C) enjoys the same factory warranty as such a new good. (o) Presidential Proclamation Authority.— (1) In general.— The President is authorized to proclaim, as part of the HTS— (A) the provisions set out in Annex 4.1 of the Agreement; and (B) any additional subordinate category necessary to carry out this title consistent with the Agreement. (2) Modifications.— (A) In general.— Subject to the consultation and layover provisions of section 103(a), the President may proclaim modifications to the provisions proclaimed under the authority of paragraph (1)(A), other than provisions of chapters 50 through 63 of the HTS, as included in Annex 4.1 of the Agreement. (B) Additional proclamations.— Notwithstanding subparagraph (A), and subject to the consultation and layover provisions of section 103(a), the President may proclaim— (i) modifications to the provisions proclaimed under the authority of paragraph (1)(A) that are necessary to implement an agreement with Chile pursuant to article 3.20(5) of the Agreement; and (ii) before the 1st anniversary of the date of the enactment of this Act, modifications to correct any typographical, clerical, or other nonsubstantive technical error regarding the provisions of chapters 50 through 63 of the HTS, as included in Annex 4.1 of the Agreement. SEC. 203. DRAWBACK. (a) Definition of a Good Subject to Chile FTA Drawback.— For purposes of this Act and the amendments made by subsection (b), the term “good subject to Chile FTA drawback” means any imported good other than the following: (1) A good entered under bond for transportation and exportation to Chile. (2) (A) A good exported to Chile in the same condition as when imported into the United States. (B) For purposes of subparagraph (A)— (i) processes such as testing, cleaning, repacking, inspecting, sorting, or marking a good, or preserving it in its same condition, shall not be considered to change the condition of the good; and (ii) if a good described in subparagraph (A) is commingled with fungible goods and exported in the same condition, the origin of the good for the purposes of subsection (j)(1) of section 313 of the Tariff Act of 1930 (19 U.S.C. 1313(j)(1)) may be determined on the basis of the inventory methods provided for in the regulations implementing this title. (3) A good— (A) that is— (i) deemed to be exported from the United States; (ii) used as a material in the production of another good that is deemed to be exported to Chile; or (iii) substituted for by a good of the same kind and quality that is used as a material in the production of another good that is deemed to be exported to Chile; and (B) that is delivered— (i) to a duty-free shop; (ii) for ship’s stores or supplies for a ship or aircraft; or (iii) for use in a project undertaken jointly by the United States and Chile and destined to become the property of the United States. (4) A good exported to Chile for which a refund of customs duties is granted by reason of— (A) the failure of the good to conform to sample or specification; or (B) the shipment of the good without the consent of the consignee. (5) A good that qualifies under the rules of origin set out in section 202 that is— (A) exported to Chile; (B) used as a material in the production of another good that is exported to Chile; or (C) substituted for by a good of the same kind and quality that is used as a material in the production of another good that is exported to Chile. (b) Consequential Amendments.— (1) Bonded manufacturing warehouses.— Section 311 of the Tariff Act of 1930 (19 U.S.C. 1311) is amended by adding at the end the following new paragraph:   “No article manufactured in a bonded warehouse from materials that are goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, may be withdrawn from warehouse for exportation to Chile without assessment of a duty on the materials in their condition and quantity, and at their weight, at the time of importation into the United States. The duty shall be paid before the 61st day after the date of exportation, except that the duty may be waived or reduced by— “(1) 100 percent during the 8-year period beginning on January 1, 2004; “(2) 75 percent during the 1-year period beginning on January 1, 2012; “(3) 50 percent during the 1-year period beginning on January 1, 2013; and “(4) 25 percent during the 1-year period beginning on January 1, 2014.” . (2) Bonded smelting and refining warehouses.— Section 312 of the Tariff Act of 1930 (19 U.S.C. 1312) is amended— (A) in paragraph (1) of subsection (b), by striking “except that” and all that follows through subparagraph (B) and inserting the following: “except that— “(A) in the case of a withdrawal for exportation of such a product to a NAFTA country, as defined in section 2(4) of the North American Free Trade Agreement Implementation Act, if any of the imported metal-bearing materials are goods subject to NAFTA drawback, as defined in section 203(a) of that Act, the duties on the materials shall be paid, and the charges against the bond canceled, before the 61st day after the date of exportation; but upon the presentation, before such 61st day, of satisfactory evidence of the amount of any customs duties paid to the NAFTA country on the product, the duties on the materials may be waived or reduced (subject to section 508(b)(2)(B)) in an amount that does not exceed the lesser of— “(i) the total amount of customs duties owed on the materials on importation into the United States, or “(ii) the total amount of customs duties paid to the NAFTA country on the product, and “(B) in the case of a withdrawal for exportation of such a product to Chile, if any of the imported metal-bearing materials are goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, the duties on the materials shall be paid, and the charges against the bond canceled, before the 61st day after the date of exportation, except that the duties may be waived or reduced by— “(i) 100 percent during the 8-year period beginning on January 1, 2004, “(ii) 75 percent during the 1-year period beginning on January 1, 2012, “(iii) 50 percent during the 1-year period beginning on January 1, 2013, and “(iv) 25 percent during the 1-year period beginning on January 1, 2014, or” ; (B) in paragraph (4) of subsection (b), by striking “except that” and all that follows through subparagraph (B) and inserting the following: “except that— “(A) in the case of a withdrawal for exportation of such a product to a NAFTA country, as defined in section 2(4) of the North American Free Trade Agreement Implementation Act, if any of the imported metal-bearing materials are goods subject to NAFTA drawback, as defined in section 203(a) of that Act, the duties on the materials shall be paid, and the charges against the bond canceled, before the 61st day after the date of exportation; but upon the presentation, before such 61st day, of satisfactory evidence of the amount of any customs duties paid to the NAFTA country on the product, the duties on the materials may be waived or reduced (subject to section 508(b)(2)(B)) in an amount that does not exceed the lesser of— “(i) the total amount of customs duties owed on the materials on importation into the United States, or “(ii) the total amount of customs duties paid to the NAFTA country on the product, and “(B) in the case of a withdrawal for exportation of such a product to Chile, if any of the imported metal-bearing materials are goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, the duties on the materials shall be paid, and the charges against the bond canceled, before the 61st day after the date of exportation, except that the duties may be waived or reduced by— “(i) 100 percent during the 8-year period beginning on January 1, 2004, “(ii) 75 percent during the 1-year period beginning on January 1, 2012, “(iii) 50 percent during the 1-year period beginning on January 1, 2013, and “(iv) 25 percent during the 1-year period beginning on January 1, 2014, or” ; and (C) in subsection (d), in the matter preceding paragraph (1), by striking “except that” and all that follows through the end of paragraph (2) and inserting the following: “except that— “(1) in the case of a withdrawal for exportation to a NAFTA country, as defined in section 2(4) of the North American Free Trade Agreement Implementation Act, if any of the imported metal-bearing materials are goods subject to NAFTA drawback, as defined in section 203(a) of that Act, charges against the bond shall be paid before the 61st day after the date of exportation; but upon the presentation, before such 61st day, of satisfactory evidence of the amount of any customs duties paid to the NAFTA country on the product, the bond shall be credited (subject to section 508(b)(2)(B)) in an amount not to exceed the lesser of— “(A) the total amount of customs duties paid or owed on the materials on importation into the United States, or “(B) the total amount of customs duties paid to the NAFTA country on the product; and “(2) in the case of a withdrawal for exportation to Chile, if any of the imported metal-bearing materials are goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, charges against the bond shall be paid before the 61st day after the date of exportation, and the bond shall be credited in an amount equal to— “(A) 100 percent of the total amount of customs duties paid or owed on the materials on importation into the United States during the 8-year period beginning on January 1, 2004, “(B) 75 percent of the total amount of customs duties paid or owed on the materials on importation into the United States during the 1-year period beginning on January 1, 2012, “(C) 50 percent of the total amount of customs duties paid or owed on the materials on importation into the United States during the 1-year period beginning on January 1, 2013, and “(D) 25 percent of the total amount of customs duties paid or owed on the materials on importation into the United States during the 1-year period beginning on January 1, 2014.” . (3) Drawback.— Section 313 of the Tariff Act of 1930 (19 U.S.C. 1313) is amended— (A) in paragraph (4) of subsection (j)— (i) by striking “(4)” and inserting “(4)(A)”; and (ii) by adding at the end the following new subparagraph: “(B) Effective date. Beginning on January 1, 2015, the exportation to Chile of merchandise that is fungible with and substituted for imported merchandise, other than merchandise described in paragraphs (1) through (5) of section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, shall not constitute an exportation for purposes of paragraph (2). The preceding sentence shall not be construed to permit the substitution of unused drawback under paragraph (2) of this subsection with respect to merchandise described in paragraph (2) of section 203(a) of the United States-Chile Free Trade Agreement Implementation Act.” ; (B) in subsection (n)— (i) by striking “(n)” and inserting the following: “(n) Refunds, Waivers, or Reductions Under Certain Free Trade Agreements.— ” ; (ii) in paragraph (1)— (I) by striking “; and” at the end of subparagraph (B); (II) by striking the period at the end of subparagraph (C) and inserting “; and”; and (III) by adding at the end the following new subparagraph: “(D) the term ‘good subject to Chile FTA drawback’ has the meaning given that term in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act.” ; and (iii) by adding the following new paragraph at the end: “(4) (A) For purposes of subsections (a), (b), (f), (h), (j)(2), (p), and (q), if an article that is exported to Chile is a good subject to Chile FTA drawback, no customs duties on the good may be refunded, waived, or reduced, except as provided in subparagraph (B). “(B) The customs duties referred to in subparagraph (A) may be refunded, waived, or reduced by— “(i) 100 percent during the 8-year period beginning on January 1, 2004; “(ii) 75 percent during the 1-year period beginning on January 1, 2012; “(iii) 50 percent during the 1-year period beginning on January 1, 2013; and “(iv) 25 percent during the 1-year period beginning on January 1, 2014.” ; and (C) in subsection (o)— (i) by striking “(o)” and inserting the following: “(o) Special Rules for Certain Vessels and Imported Materials.— ” ; and (ii) by adding at the end the following new paragraphs: “(3) For purposes of subsection (g), if— “(A) a vessel is built for the account and ownership of a resident of Chile or the Government of Chile, and “(B) imported materials that are used in the construction and equipment of the vessel are goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, no customs duties on such materials may be refunded, waived, or reduced, except as provided in paragraph (4). “(4) The customs duties referred to in paragraph (3) may be refunded, waived or reduced by— “(A) 100 percent during the 8-year period beginning on January 1, 2004; “(B) 75 percent during the 1-year period beginning on January 1, 2012; “(C) 50 percent during the 1-year period beginning on January 1, 2013; and “(D) 25 percent during the 1-year period beginning on January 1, 2014.” . (4) Manipulation in warehouse.— Section 562 of the Tariff Act of 1930 (19 U.S.C. 1562) is amended— (A) in paragraph (3), by striking “to a NAFTA country” and inserting “to Chile, to a NAFTA country,”; (B) by striking “and” at the end of paragraph (4)(B); (C) by striking the period at the end of paragraph (5) and inserting “; and”; and (D) by inserting after paragraph (5) the following: “(6) (A) without payment of duties for exportation to Chile, if the merchandise is of a kind described in any of paragraphs (1) through (5) of section 203(a) of the United States-Chile Free Trade Agreement Implementation Act; and “(B) for exportation to Chile if the merchandise consists of goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, except that— “(i) the merchandise may not be withdrawn from warehouse without assessment of a duty on the merchandise in its condition and quantity, and at its weight, at the time of withdrawal from the warehouse with such additions to, or deductions from, the final appraised value as may be necessary by reason of a change in condition, and “(ii) duty shall be paid on the merchandise before the 61st day after the date of exportation, except that such duties may be waived or reduced by— “(I) 100 percent during the 8-year period beginning on January 1, 2004, “(II) 75 percent during the 1-year period beginning on January 1, 2012, “(III) 50 percent during the 1-year period beginning on January 1, 2013, and “(IV) 25 percent during the 1-year period beginning on January 1, 2014.” . (5) Foreign trade zones.— Section 3(a) of the Act of June 18, 1934 (commonly known as the “Foreign Trade Zones Act”; 19 U.S.C. 81c(a)) is amended by striking the end period and inserting the following: “: Provided further, That no merchandise that consists of goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, that is manufactured or otherwise changed in condition shall be exported to Chile without an assessment of a duty on the merchandise in its condition and quantity, and at its weight, at the time of its exportation (or if the privilege in the first proviso to this subsection was requested, an assessment of a duty on the merchandise in its condition and quantity, and at its weight, at the time of its admission into the zone) and the payment of the assessed duty before the 61st day after the date of exportation of the article, except that the customs duty may be waived or reduced by (1) 100 percent during the 8-year period beginning on January 1, 2004; (2) 75 percent during the 1-year period beginning on January 1, 2012; (3) 50 percent during the 1-year period beginning on January 1, 2013; and (4) 25 percent during the 1-year period beginning on January 1, 2014.”. (c) Inapplicability to Countervailing and Antidumping Duties.— Nothing in this section or the amendments made by this section shall be considered to authorize the refund, waiver, or reduction of countervailing duties or antidumping duties imposed on an imported good. SEC. 204. CUSTOMS USER FEES.   Section 13031(b) of the Consolidated Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 58c(b)) is amended by inserting after paragraph (11) the following: “(12) No fee may be charged under subsection (a) (9) or (10) with respect to goods that qualify as originating goods under section 202 of the United States-Chile Free Trade Agreement Implementation Act. Any service for which an exemption from such fee is provided by reason of this paragraph may not be funded with money contained in the Customs User Fee Account.” . SEC. 205. DISCLOSURE OF INCORRECT INFORMATION; DENIAL OF PREFERENTIAL TARIFF TREATMENT; FALSE CERTIFICATES OF ORIGIN. (a) Disclosure of Incorrect Information.— Section 592 of the Tariff Act of 1930 (19 U.S.C. 1592) is amended— (1) in subsection (c)— (A) by redesignating paragraph (6) as paragraph (7); and (B) by inserting after paragraph (5) the following new paragraph: “(6) Prior disclosure regarding claims under the united states-chile free trade agreement.— An importer shall not be subject to penalties under subsection (a) for making an incorrect claim that a good qualifies as an originating good under section 202 of the United States-Chile Free Trade Agreement Implementation Act if the importer, in accordance with regulations issued by the Secretary of the Treasury, voluntarily makes a corrected declaration and pays any duties owing.” ; and (2) by adding at the end the following new subsection: “(g) False Certifications of Origin Under the United States-Chile Free Trade Agreement.— “(1) In general.— Subject to paragraph (2), it is unlawful for any person to certify falsely, by fraud, gross negligence, or negligence, in a Chile FTA Certificate of Origin (as defined in section 508(f)(1)(B) of this Act that a good exported from the United States qualifies as an originating good under the rules of origin set out in section 202 of the United States-Chile Free Trade Agreement Implementation Act. Applicability. The procedures and penalties of this section that apply to a violation of subsection (a) also apply to a violation of this subsection. “(2) Immediate and voluntary disclosure of incorrect information.— No penalty shall be imposed under this subsection if, immediately after an exporter or producer that issued a Chile FTA Certificate of Origin has reason to believe that such certificate contains or is based on incorrect information, the exporter or producer voluntarily provides written notice of such incorrect information to every person to whom the certificate was issued. “(3) Exception.— A person may not be considered to have violated paragraph (1) if— “(A) the information was correct at the time it was provided in a Chile FTA Certificate of Origin but was later rendered incorrect due to a change in circumstances; and “(B) the person immediately and voluntarily provides written notice of the change in circumstances to all persons to whom the person provided the certificate.” . (b) Denial of Preferential Tariff Treatment.— Section 514 of the Tariff Act of 1930 (19 U.S.C. 1514) is amended by adding at the end the following new subsection: “(g) Denial of Preferential Tariff Treatment Under United States-Chile Free Trade Agreement.— If the Bureau of Customs and Border Protection or the Bureau of Immigration and Customs Enforcement finds indications of a pattern of conduct by an importer of false or unsupported representations that goods qualify under the rules of origin set out in section 202 of the United States-Chile Free Trade Agreement Implementation Act, the Bureau of Customs and Border Protection, in accordance with regulations issued by the Secretary of the Treasury, may deny preferential tariff treatment under the United States-Chile Free Trade Agreement to entries of identical goods imported by that person until the person establishes to the satisfaction of the Bureau of Customs and Border Protection that representations of that person are in conformity with such section 202.” . SEC. 206. RELIQUIDATION OF ENTRIES.   Subsection (d) of section 520 of the Tariff Act of 1930 (19 U.S.C. 1520(d)) is amended— (1) by striking “(d)” and inserting the following: “(d) Goods Qualifying Under Free Trade Agreement Rules of Origin.— ” ; (2) in the matter preceding paragraph (1), by inserting “or section 202 of the United States-Chile Free Trade Agreement Implementation Act” after “Act”; (3) in paragraph (1), by striking “those” and inserting “the applicable”; and (4) in paragraph (2), by inserting before the semicolon “, or other certificates of origin, as the case may be”. SEC. 207. RECORDKEEPING REQUIREMENTS.   Section 508 of the Tariff Act of 1930 (19 U.S.C. 1508) is amended— (1) by striking the heading of subsection (b) and inserting the following: “Exportations to NAFTA Countries.—”; and (2) by adding at the end the following: “(f) Certificates of Origin for Goods Exported Under the United States-Chile Free Trade Agreement.— “(1) Definitions.— In this subsection: “(A) Records and supporting documents.— The term ‘records and supporting documents’ means, with respect to an exported good under paragraph (2), records and documents related to the origin of the good, including— “(i) the purchase, cost, and value of, and payment for, the good; “(ii) if applicable, the purchase, cost, and value of, and payment for, all materials, including recovered goods, used in the production of the good; and “(iii) if applicable, the production of the good in the form in which it was exported. “(B) Chile fta certificate of origin.— The term ‘Chile FTA Certificate of Origin’ means the certification, established under article 4.13 of the United States-Chile Free Trade Agreement, that a good qualifies as an originating good under such Agreement. “(2) Exports to chile.— Any person who completes and issues a Chile FTA Certificate of Origin for a good exported from the United States shall make, keep, and, pursuant to rules and regulations promulgated by the Secretary of the Treasury, render for examination and inspection all records and supporting documents related to the origin of the good (including the Certificate or copies thereof). “(3) Retention period.— Records and supporting documents shall be kept by the person who issued a Chile FTA Certificate of Origin for at least 5 years after the date on which the certificate was issued. “(g) Penalties.— Any person who fails to retain records and supporting documents required by subsection (f) or the regulations issued to implement that subsection shall be liable for the greater of— “(1) a civil penalty not to exceed $10,000; or “(2) the general record keeping penalty that applies under the customs laws of the United States.” . SEC. 208. ENFORCEMENT OF TEXTILE AND APPAREL RULES OF ORIGIN. (a) Action During Verification.— If the Secretary of the Treasury requests the Government of Chile to conduct a verification pursuant to article 3.21 of the Agreement for purposes of determining that— (1) an exporter or producer in Chile is complying with applicable customs laws, regulations, and procedures regarding trade in textile and apparel goods, or (2) claims that textile or apparel goods exported or produced by such exporter or producer— (A) qualify as originating goods under section 202 of this Act, or (B) are goods of Chile, are accurate, the President may direct the Secretary to take appropriate action described in subsection (b) while the verification is being conducted. (b) Appropriate Action Described.— Appropriate action under subsection (a) includes— (1) suspension of liquidation of entries of textile and apparel goods exported or produced by the person that is the subject of the verification, in a case in which the request for verification was based on a reasonable suspicion of unlawful activity related to such goods; and (2) publication of the name of the person that is the subject of the verification. (c) Action When Information is Insufficient.— If the Secretary of the Treasury determines that the information obtained within 12 months after making a request for a verification under subsection (a) is insufficient to make a determination under subsection (a), the President may direct the Secretary to take appropriate action described in subsection (d) until such time as the Secretary receives information sufficient to make a determination under subsection (a) or until such earlier date as the President may direct. (d) Appropriate Action Described.— Appropriate action under subsection (c) includes— (1) publication of the identity of the person that is the subject of the verification; (2) denial of preferential tariff treatment under the Agreement to any textile or apparel goods exported or produced by the person that is the subject of the verification; and (3) denial of entry into the United States of any textile or apparel goods exported or produced by the person that is the subject of the verification. SEC. 209. CONFORMING AMENDMENTS.   Section 508(b)(2)(B)(i)(I) of the Tariff Act of 1930 (19 U.S.C. 1508(b)(2)(B)(i)(I)) is amended— (1) by striking “the last paragraph of section 311” and inserting “the eleventh paragraph of section 311”; and (2) by striking “the last proviso to section 3(a)” and inserting “the proviso preceding the last proviso to section 3(a)”. SEC. 210. REGULATIONS.   The Secretary of the Treasury shall prescribe such regulations as may be necessary to carry out— (1) subsections (a) through (n) of section 202, and sections 203 and 204; (2) amendments made by the sections referred to in paragraph (1); and (3) proclamations issued under section 202(o).

10. 2003

    United States-Chile Free Trade Agreement Implementation Act

    Pub. L. 108–77 title II · 117 Stat. 909

    1. Substituted · 19 U.S.C. § 1508(b)(2)(B)(i)(I)

       Pub. L. 108–77, §§ 107(c), 209, temporarily substituted “the eleventh paragraph of section 1311 of this title” for “the last paragraph of section 1311 of this title” . See Effective and Termination Dates of 2003 Amendment note below

    2. Substituted · 19 U.S.C. § 1508(b)(2)(B)(i)(I)

       Pub. L. 108–77, §§ 107(c), 209, temporarily substituted “the proviso preceding the last proviso to section 81c(a) of this title” for “the last proviso to section 81c(a) of this title” . See Effective and Termination Dates of 2003 Amendment note below

    Source evidence

    Code amendment note
    Subsec. (b)(2)(B)(i)(I). Pub. L. 108–77, §§ 107(c), 209, temporarily substituted “the eleventh paragraph of section 1311 of this title” for “the last paragraph of section 1311 of this title” and “the proviso preceding the last proviso to section 81c(a) of this title” for “the last proviso to section 81c(a) of this title”. See Effective and Termination Dates of 2003 Amendment note below.

    Enacted provision · exact public law
    TITLE II— CUSTOMS PROVISIONS SEC. 201. TARIFF MODIFICATIONS. (a) Tariff Modifications Provided for in the Agreement.— (1) Proclamation authority.— The President may proclaim— (A) such modifications or continuation of any duty, (B) such continuation of duty-free or excise treatment, or (C) such additional duties, as the President determines to be necessary or appropriate to carry out or apply articles 3.3, 3.7, 3.9, article 3.20 (8), (9), (10), and (11), and Annex 3.3 of the Agreement. (2) Effect on chilean gsp status.— Notwithstanding section 502(a)(1) of the Trade Act of 1974 (19 U.S.C. 2462(a)(1)), the President shall terminate the designation of Chile as a beneficiary developing country for purposes of title V of the Trade Act of 1974 on the date of entry into force of the Agreement. (b) Other Tariff Modifications.— Subject to the consultation and layover provisions of section 103(a), the President may proclaim— (1) such modifications or continuation of any duty, (2) such modifications as the United States may agree to with Chile regarding the staging of any duty treatment set forth in Annex 3.3 of the Agreement, (3) such continuation of duty-free or excise treatment, or (4) such additional duties, as the President determines to be necessary or appropriate to maintain the general level of reciprocal and mutually advantageous concessions with respect to Chile provided for by the Agreement. (c) Additional Tariffs on Agricultural Safeguard Goods.— (1) In general.— In addition to any duty proclaimed under subsection (a) or (b), and subject to paragraphs (3) through (5), the Secretary of the Treasury shall assess a duty, in the amount prescribed under paragraph (2), on an agricultural safeguard good if the Secretary of the Treasury determines that the unit import price of the good when it enters the United States, determined on an F.O.B. basis, is less than the trigger price indicated for that good in Annex 3.18 of the Agreement or any amendment thereto. (2) Calculation of additional duty.— The amount of the additional duty assessed under this subsection shall be determined as follows: (A) If the difference between the unit import price and the trigger price is less than, or equal to, 10 percent of the trigger price, no additional duty shall be imposed. (B) If the difference between the unit import price and the trigger price is greater than 10 percent, but less than or equal to 40 percent, of the trigger price, the additional duty shall be equal to 30 percent of the difference between the preferential tariff rate and the column 1 general rate of duty imposed under the HTS on like articles at the time the additional duty is imposed. (C) If the difference between the unit import price and the trigger price is greater than 40 percent, but less than or equal to 60 percent, of the trigger price, the additional duty shall be equal to 50 percent of the difference between the preferential tariff rate and the column 1 general rate of duty imposed under the HTS on like articles at the time the additional duty is imposed. (D) If the difference between the unit import price and the trigger price is greater than 60 percent, but less than or equal to 75 percent, of the trigger price, the additional duty shall be equal to 70 percent of the difference between the preferential tariff rate and the column 1 general rate of duty imposed under the HTS on like articles at the time the additional duty is imposed. (E) If the difference between the unit import price and the trigger price is greater than 75 percent of the trigger price, the additional duty shall be equal to 100 percent of the difference between the preferential tariff rate and the column 1 general rate of duty imposed under the HTS on like articles at the time the additional duty is imposed. (3) Exceptions.— No additional duty under this subsection shall be assessed on an agricultural safeguard good if, at the time of entry, the good is subject to import relief under— (A) subtitle A of title III of this Act; or (B) chapter 1 of title II of the Trade Act of 1974 (19 U.S.C. 2251 et seq.). (4) Termination.— This Applicability. subsection shall cease to apply on the date that is 12 years after the date on which the Agreement enters into force. (5) Tariff-rate quotas.— If Applicability. an agricultural safeguard good is subject to a tariff-rate quota, and the in-quota duty rate for the good proclaimed pursuant to subsection (a) or (b) is zero, any additional duty assessed under this subsection shall be applied only to over-quota imports of the good. (6) Notice.— Not Deadline. later than 60 days after the Secretary of the Treasury first assesses additional duties on an agricultural safeguard good under this subsection, the Secretary shall notify the Government of Chile in writing of such action and shall provide to the Government of Chile data supporting the assessment of additional duties. (7) Modification of trigger prices.— Not later than 60 calendar days before agreeing with the Government of Chile pursuant to article 3.18(2)(b) of the Agreement on a modification to a trigger price for a good listed in Annex 3.18 of the Agreement, the President shall notify the Committees on Ways and Means and Agriculture of the House of Representatives and the Committees on Finance and Agriculture of the Senate of the proposed modification and the reasons therefor. (8) Definitions.— In this subsection: (A) Agricultural safeguard good.— The term “agricultural safeguard good” means a good— (i) that qualifies as an originating good under section 202; (ii) that is included in the United States Agricultural Safeguard Product List set forth in Annex 3.18 of the Agreement; and (iii) for which a claim for preferential tariff treatment under the Agreement has been made. (B) F.O.B.— The term “F.O.B.” means free on board, regardless of the mode of transportation, at the point of direct shipment by the seller to the buyer. (C) Unit import price.— The term “unit import price” means the price expressed in dollars per kilogram. (d) Conversion to Ad Valorem Rates.— For purposes of subsections (a) and (b), with respect to any good for which the base rate in the Schedule of the United States to Annex 3.3 of the Agreement is a specific or compound rate of duty, the President may substitute for the base rate an ad valorem rate that the President determines to be equivalent to the base rate. SEC. 202. RULES OF ORIGIN. (a) Originating Goods.— (1) In general.— For purposes of this Act and for purposes of implementing the tariff treatment provided for under the Agreement, except as otherwise provided in this section, a good is an originating good if— (A) the good is wholly obtained or produced entirely in the territory of Chile, the United States, or both; (B) the good— (i) is produced entirely in the territory of Chile, the United States, or both, and (I) each of the nonoriginating materials used in the production of the good undergoes an applicable change in tariff classification specified in Annex 4.1 of the Agreement, or (II) the good otherwise satisfies any applicable regional value-content or other requirements specified in Annex 4.1 of the Agreement; and (ii) satisfies all other applicable requirements of this section; or (C) the good is produced entirely in the territory of Chile, the United States, or both, exclusively from materials described in subparagraph (A) or (B). (2) Simple combination or mere dilution.— A good shall not be considered to be an originating good and a material shall not be considered to be an originating material by virtue of having undergone— (A) simple combining or packaging operations; or (B) mere dilution with water or another substance that does not materially alter the characteristics of the good or material. (b) De Minimis Amounts of Nonoriginating Materials.— (1) In general.— Except as provided in paragraphs (2) and (3), a good that does not undergo a change in tariff classification pursuant to Annex 4.1 of the Agreement is an originating good if— (A) the value of all nonoriginating materials that are used in the production of the good and do not undergo the applicable change in tariff classification does not exceed 10 percent of the adjusted value of the good; (B) the value of such nonoriginating materials is included in the value of nonoriginating materials for any applicable regional value-content requirement; and (C) the good meets all other applicable requirements of this section. (2) Exceptions.— Paragraph (1) does not apply to the following: (A) A nonoriginating material provided for in chapter 4 of the HTS, or a nonoriginating dairy preparation containing over 10 percent by weight of milk solids provided for in subheading 1901.90 or 2106.90 of the HTS, that is used in the production of a good provided for in chapter 4 of the HTS. (B) A nonoriginating material provided for in chapter 4 of the HTS, or nonoriginating dairy preparations containing over 10 percent by weight of milk solids provided for in subheading 1901.90 of the HTS, that are used in the production of the following goods: (i) Infant preparations containing over 10 percent in weight of milk solids provided for in subheading 1901.10 of the HTS. (ii) Mixes and doughs, containing over 25 percent by weight of butterfat, not put up for retail sale, provided for in subheading 1901.20 of the HTS. (iii) Dairy preparations containing over 10 percent by weight of milk solids provided for in subheading 1901.90 or 2106.90 of the HTS. (iv) Goods provided for in heading 2105 of the HTS. (v) Beverages containing milk provided for in subheading 2202.90 of the HTS. (vi) Animal feeds containing over 10 percent by weight of milk solids provided for in subheading 2309.90 of the HTS. (C) A nonoriginating material provided for in heading 0805 of the HTS, or any of subheadings 2009.11.00 through 2009.39 of the HTS, that is used in the production of a good provided for in any of subheadings 2009.11.00 through 2009.39 of the HTS, or in fruit or vegetable juice of any single fruit or vegetable, fortified with minerals or vitamins, concentrated or unconcentrated, provided for in subheading 2106.90 or 2202.90 of the HTS. (D) A nonoriginating material provided for in chapter 15 of the HTS that is used in the production of a good provided for in any of headings 1501.00.00 through 1508, 1512, 1514, and 1515 of the HTS. (E) A nonoriginating material provided for in heading 1701 of the HTS that is used in the production of a good provided for in any of headings 1701 through 1703 of the HTS. (F) A nonoriginating material provided for in chapter 17 of the HTS or in heading 1805.00.00 of the HTS that is used in the production of a good provided for in subheading 1806.10 of the HTS. (G) A nonoriginating material provided for in any of headings 2203 through 2208 of the HTS that is used in the production of a good provided for in heading 2207 or 2208 of the HTS. (H) A nonoriginating material used in the production of a good provided for in any of chapters 1 through 21 of the HTS, unless the nonoriginating material is provided for in a different subheading than the good for which origin is being determined under this section. (3) Goods provided for in chapters 50 through 63 of the hts.— (A) In general.— Except as provided in subparagraph (B), a good provided for in any of chapters 50 through 63 of the HTS that is not an originating good because certain fibers or yarns used in the production of the component of the good that determines the tariff classification of the good do not undergo an applicable change in tariff classification set out in Annex 4.1 of the Agreement, shall be considered to be an originating good if the total weight of all such fibers or yarns in that component is not more than 7 percent of the total weight of that component. (B) Certain textile or apparel goods.— A textile or apparel good containing elastomeric yarns in the component of the good that determines the tariff classification of the good shall be considered to be an originating good only if such yarns are wholly formed in the territory of Chile or the United States. (c) Accumulation.— (1) Originating goods incorporated in goods of other country.— Originating goods or materials of Chile or the United States that are incorporated into a good in the territory of the other country shall be considered to originate in the territory of the other country. (2) Multiple procedures.— A good that is produced in the territory of Chile, the United States, or both, by 1 or more producers, is an originating good if the good satisfies the requirements of subsection (a) and all other applicable requirements of this section. (d) Regional Value-Content.— (1) In general.— For purposes of subsection (a)(2), the regional value-content of a good referred to in Annex 4.1 of the Agreement shall be calculated, at the choice of the person claiming preferential tariff treatment for the good, on the basis of the build-down method described in paragraph (2) or the build-up method described in paragraph (3), unless otherwise provided in Annex 4.1 of the Agreement. (2) Build-down method.— (A) In general.— The regional value-content of a good may be calculated on the basis of the following build-down method:  RVC =AV - VNM× 100  AV     (B) Definitions.— For purposes of subparagraph (A): (i) The term “RVC” means the regional value-content, expressed as a percentage. (ii) The term “AV” means the adjusted value. (iii) The term “VNM” means the value of nonoriginating materials used by the producer in the production of the good. (3) Build-up method.— (A) In general.— The regional value-content of a good may be calculated on the basis of the following build-up method:  RVC =VOM× 100  AV     (B) Definitions.— For purposes of subparagraph (A): (i) The term “RVC” means the regional value-content, expressed as a percentage. (ii) The term “AV” means the adjusted value. (iii) The term “VOM” means the value of originating materials used by the producer in the production of the good. (e) Value of Materials.— (1) In general.— For purposes of calculating the regional value-content of a good under subsection (d), and for purposes of applying the de minimis rules under subsection (b), the value of a material is— (A) in the case of a material that is imported by the producer of the good, the adjusted value of the material with respect to that importation; (B) in the case of a material acquired in the territory in which the good is produced, except for a material to which subparagraph (C) applies, the producer’s price actually paid or payable for the material; (C) in the case of a material provided to the producer without charge, or at a price reflecting a discount or similar reduction, the sum of— (i) all expenses incurred in the growth, production, or manufacture of the material, including general expenses; and (ii) an amount for profit; or (D) in the case of a material that is self-produced, the sum of— (i) all expenses incurred in the production of the material, including general expenses; and (ii) an amount for profit. (2) Further adjustments to the value of materials.— (A) Originating materials.— The following expenses, if not included in the value of an originating material calculated under paragraph (1), may be added to the value of the originating material: (i) The costs of freight, insurance, packing, and all other costs incurred in transporting the material to the location of the producer. (ii) Duties, taxes, and customs brokerage fees on the material paid in the territory of Chile, the United States, or both, other than duties and taxes that are waived, refunded, refundable, or otherwise recoverable, including credit against duty or tax paid or payable. (iii) The cost of waste and spoilage resulting from the use of the material in the production of the good, less the value of renewable scrap or byproduct. (B) Nonoriginating materials.— The following expenses, if included in the value of a nonoriginating material calculated under paragraph (1), may be deducted from the value of the nonoriginating material: (i) The costs of freight, insurance, packing, and all other costs incurred in transporting the material to the location of the producer. (ii) Duties, taxes, and customs brokerage fees on the material paid in the territory of Chile, the United States, or both, other than duties and taxes that are waived, refunded, refundable, or otherwise recoverable, including credit against duty or tax paid or payable. (iii) The cost of waste and spoilage resulting from the use of the material in the production of the good, less the value of renewable scrap or byproducts. (iv) The cost of originating materials used in the production of the nonoriginating material in the territory of Chile or the United States. (f) Accessories, Spare Parts, or Tools.— Accessories, spare parts, or tools delivered with a good that form part of the good’s standard accessories, spare parts, or tools shall be regarded as a material used in the production of the good, if— (1) the accessories, spare parts, or tools are classified with and not invoiced separately from the good; and (2) the quantities and value of the accessories, spare parts, or tools are customary for the good. (g) Fungible Goods and Materials.— (1) In general.— (A) Claim for preferential treatment.— A person claiming preferential tariff treatment for a good may claim that a fungible good or material is originating either based on the physical segregation of each fungible good or material or by using an inventory management method. (B) Inventory management method.— In this subsection, the term “inventory management method” means— (i) averaging; (ii) “last-in, first-out”; (iii) “first-in, first-out”; or (iv) any other method— (I) recognized in the generally accepted accounting principles of the country in which the production is performed (whether Chile or the United States); or (II) otherwise accepted by that country. (2) Election of inventory method.— A person selecting an inventory management method under paragraph (1) for particular fungible goods or materials shall continue to use that method for those goods or materials throughout the fiscal year of that person. (h) Packaging Materials and Containers for Retail Sale.— Packaging materials and containers in which a good is packaged for retail sale, if classified with the good, shall be disregarded in determining whether all nonoriginating materials used in the production of the good undergo the applicable change in tariff classification set out in Annex 4.1 of the Agreement, and, if the good is subject to a regional value-content requirement, the value of such packaging materials and containers shall be taken into account as originating or nonoriginating materials, as the case may be, in calculating the regional value-content of the good. (i) Packing Materials and Containers for Shipment.— Packing materials and containers for shipment shall be disregarded in determining whether— (1) the nonoriginating materials used in the production of the good undergo an applicable change in tariff classification set out in Annex 4.1 of the Agreement; and (2) the good satisfies a regional value-content requirement. (j) Indirect Materials.— An indirect material shall be considered to be an originating material without regard to where it is produced. (k) Transit and Transshipment.— A good that has undergone production necessary to qualify as an originating good under subsection (a) shall not be considered to be an originating good if, subsequent to that production, the good undergoes further production or any other operation outside the territory of Chile or the United States, other than unloading, reloading, or any other process necessary to preserve the good in good condition or to transport the good to the territory of Chile or the United States. (l) Textile and Apparel Goods Classifiable as Goods Put Up in Sets.— Notwithstanding the rules set forth in Annex 4.1 of the Agreement, textile and apparel goods classifiable as goods put up in sets for retail sale as provided for in General Rule of Interpretation 3 of the Harmonized System shall not be considered to be originating goods unless each of the goods in the set is an originating good or the total value of the nonoriginating goods in the set does not exceed 10 percent of the value of the set determined for purposes of assessing customs duties. (m) Application and Interpretation.— In this section: (1) The basis for any tariff classification is the HTS. (2) Records. Any cost or value referred to in this section shall be recorded and maintained in accordance with the generally accepted accounting principles applicable in the territory of the country in which the good is produced (whether Chile or the United States). (n) Definitions.— In this section: (1) Adjusted value.— The term “adjusted value” means the value determined in accordance with articles 1 through 8, article 15, and the corresponding interpretive notes of the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994 referred to in section 101(d)(8) of the Uruguay Round Agreements Act, except that such value may be adjusted to exclude any costs, charges, or expenses incurred for transportation, insurance, and related services incident to the international shipment of the merchandise from the country of exportation to the place of importation. (2) Fungible goods or fungible materials.— The terms “fungible goods” and “fungible materials” mean goods or materials, as the case may be, that are interchangeable for commercial purposes and the properties of which are essentially identical. (3) Generally accepted accounting principles.— The term “generally accepted accounting principles” means the principles, rules, and procedures, including both broad and specific guidelines, that define the accounting practices accepted in the territory of Chile or the United States, as the case may be. (4) Goods wholly obtained or produced entirely in the territory of chile, the united states, or both.— The term “goods wholly obtained or produced entirely in the territory of Chile, the United States, or both” means— (A) mineral goods extracted in the territory of Chile, the United States, or both; (B) vegetable goods, as such goods are defined in the Harmonized System, harvested in the territory of Chile, the United States, or both; (C) live animals born and raised in the territory of Chile, the United States, or both; (D) goods obtained from hunting, trapping, or fishing in the territory of Chile, the United States, or both; (E) goods (fish, shellfish, and other marine life) taken from the sea by vessels registered or recorded with Chile or the United States and flying the flag of that country; (F) goods produced on board factory ships from the goods referred to in subparagraph (E), if such factory ships are registered or recorded with Chile or the United States and fly the flag of that country; (G) goods taken by Chile or the United States or a person of Chile or the United States from the seabed or beneath the seabed outside territorial waters, if Chile or the United States has rights to exploit such seabed; (H) goods taken from outer space, if the goods are obtained by Chile or the United States or a person of Chile or the United States and not processed in the territory of a country other than Chile or the United States; (I) waste and scrap derived from— (i) production in the territory of Chile, the United States, or both; or (ii) used goods collected in the territory of Chile, the United States, or both, if such goods are fit only for the recovery of raw materials; (J) recovered goods derived in the territory of Chile or the United States from used goods, and used in the territory of that country in the production of remanufactured goods; and (K) goods produced in the territory of Chile, the United States, or both, exclusively— (i) from goods referred to in any of subparagraphs (A) through (I), or (ii) from the derivatives of goods referred to in clause (i), at any stage of production. (5) Harmonized system.— The term “Harmonized System” means the Harmonized Commodity Description and Coding System. (6) Indirect material.— The term “indirect material” means a good used in the production, testing, or inspection of a good but not physically incorporated into the good, or a good used in the maintenance of buildings or the operation of equipment associated with the production of a good, including— (A) fuel and energy; (B) tools, dies, and molds; (C) spare parts and materials used in the maintenance of equipment or buildings; (D) lubricants, greases, compounding materials, and other materials used in production or used to operate equipment or buildings; (E) gloves, glasses, footwear, clothing, safety equipment, and supplies; (F) equipment, devices, and supplies used for testing or inspecting the good; (G) catalysts and solvents; and (H) any other goods that are not incorporated into the good but the use of which in the production of the good can reasonably be demonstrated to be a part of that production. (7) Material.— The term “material” means a good that is used in the production of another good, including a part, ingredient, or indirect material. (8) Material that is self-produced.— The term “material that is self-produced” means a material that is an originating good produced by a producer of a good and used in the production of that good. (9) Nonoriginating good or nonoriginating material.— The terms “nonoriginating good” and “nonoriginating material” mean a good or material, as the case may be, that does not qualify as an originating good under this section. (10) Packing materials and containers for shipment.— The term “packing materials and containers for shipment” means the goods used to protect a good during its transportation, and does not include the packaging materials and containers in which a good is packaged for retail sale. (11) Preferential tariff treatment.— The term “preferential tariff treatment” means the customs duty rate that is applicable to an originating good pursuant to chapter 3 of the Agreement. (12) Producer.— The term “producer” means a person who engages in the production of a good in the territory of Chile or the United States. (13) Production.— The term “production” means growing, mining, harvesting, fishing, raising, trapping, hunting, manufacturing, processing, assembling, or disassembling a good. (14) Recovered goods.— (A) In general.— The term “recovered goods” means materials in the form of individual parts that are the result of— (i) the complete disassembly of used goods into individual parts; and (ii) the cleaning, inspecting, testing, or other processing of those parts as necessary for improvement to sound working condition by one or more of the processes described in subparagraph (B), in order for such parts to be assembled with other parts, including other parts that have undergone the processes described in this paragraph, in the production of a remanufactured good. (B) Processes.— The processes referred to in subparagraph (A)(ii) are welding, flame spraying, surface machining, knurling, plating, sleeving, and rewinding. (15) Remanufactured good.— The term “remanufactured good” means an industrial good assembled in the territory of Chile or the United States, that is listed in Annex 4.18 of the Agreement, and— (A) is entirely or partially comprised of recovered goods; (B) has the same life expectancy and meets the same performance standards as a new good; and (C) enjoys the same factory warranty as such a new good. (o) Presidential Proclamation Authority.— (1) In general.— The President is authorized to proclaim, as part of the HTS— (A) the provisions set out in Annex 4.1 of the Agreement; and (B) any additional subordinate category necessary to carry out this title consistent with the Agreement. (2) Modifications.— (A) In general.— Subject to the consultation and layover provisions of section 103(a), the President may proclaim modifications to the provisions proclaimed under the authority of paragraph (1)(A), other than provisions of chapters 50 through 63 of the HTS, as included in Annex 4.1 of the Agreement. (B) Additional proclamations.— Notwithstanding subparagraph (A), and subject to the consultation and layover provisions of section 103(a), the President may proclaim— (i) modifications to the provisions proclaimed under the authority of paragraph (1)(A) that are necessary to implement an agreement with Chile pursuant to article 3.20(5) of the Agreement; and (ii) before the 1st anniversary of the date of the enactment of this Act, modifications to correct any typographical, clerical, or other nonsubstantive technical error regarding the provisions of chapters 50 through 63 of the HTS, as included in Annex 4.1 of the Agreement. SEC. 203. DRAWBACK. (a) Definition of a Good Subject to Chile FTA Drawback.— For purposes of this Act and the amendments made by subsection (b), the term “good subject to Chile FTA drawback” means any imported good other than the following: (1) A good entered under bond for transportation and exportation to Chile. (2) (A) A good exported to Chile in the same condition as when imported into the United States. (B) For purposes of subparagraph (A)— (i) processes such as testing, cleaning, repacking, inspecting, sorting, or marking a good, or preserving it in its same condition, shall not be considered to change the condition of the good; and (ii) if a good described in subparagraph (A) is commingled with fungible goods and exported in the same condition, the origin of the good for the purposes of subsection (j)(1) of section 313 of the Tariff Act of 1930 (19 U.S.C. 1313(j)(1)) may be determined on the basis of the inventory methods provided for in the regulations implementing this title. (3) A good— (A) that is— (i) deemed to be exported from the United States; (ii) used as a material in the production of another good that is deemed to be exported to Chile; or (iii) substituted for by a good of the same kind and quality that is used as a material in the production of another good that is deemed to be exported to Chile; and (B) that is delivered— (i) to a duty-free shop; (ii) for ship’s stores or supplies for a ship or aircraft; or (iii) for use in a project undertaken jointly by the United States and Chile and destined to become the property of the United States. (4) A good exported to Chile for which a refund of customs duties is granted by reason of— (A) the failure of the good to conform to sample or specification; or (B) the shipment of the good without the consent of the consignee. (5) A good that qualifies under the rules of origin set out in section 202 that is— (A) exported to Chile; (B) used as a material in the production of another good that is exported to Chile; or (C) substituted for by a good of the same kind and quality that is used as a material in the production of another good that is exported to Chile. (b) Consequential Amendments.— (1) Bonded manufacturing warehouses.— Section 311 of the Tariff Act of 1930 (19 U.S.C. 1311) is amended by adding at the end the following new paragraph:   “No article manufactured in a bonded warehouse from materials that are goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, may be withdrawn from warehouse for exportation to Chile without assessment of a duty on the materials in their condition and quantity, and at their weight, at the time of importation into the United States. The duty shall be paid before the 61st day after the date of exportation, except that the duty may be waived or reduced by— “(1) 100 percent during the 8-year period beginning on January 1, 2004; “(2) 75 percent during the 1-year period beginning on January 1, 2012; “(3) 50 percent during the 1-year period beginning on January 1, 2013; and “(4) 25 percent during the 1-year period beginning on January 1, 2014.” . (2) Bonded smelting and refining warehouses.— Section 312 of the Tariff Act of 1930 (19 U.S.C. 1312) is amended— (A) in paragraph (1) of subsection (b), by striking “except that” and all that follows through subparagraph (B) and inserting the following: “except that— “(A) in the case of a withdrawal for exportation of such a product to a NAFTA country, as defined in section 2(4) of the North American Free Trade Agreement Implementation Act, if any of the imported metal-bearing materials are goods subject to NAFTA drawback, as defined in section 203(a) of that Act, the duties on the materials shall be paid, and the charges against the bond canceled, before the 61st day after the date of exportation; but upon the presentation, before such 61st day, of satisfactory evidence of the amount of any customs duties paid to the NAFTA country on the product, the duties on the materials may be waived or reduced (subject to section 508(b)(2)(B)) in an amount that does not exceed the lesser of— “(i) the total amount of customs duties owed on the materials on importation into the United States, or “(ii) the total amount of customs duties paid to the NAFTA country on the product, and “(B) in the case of a withdrawal for exportation of such a product to Chile, if any of the imported metal-bearing materials are goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, the duties on the materials shall be paid, and the charges against the bond canceled, before the 61st day after the date of exportation, except that the duties may be waived or reduced by— “(i) 100 percent during the 8-year period beginning on January 1, 2004, “(ii) 75 percent during the 1-year period beginning on January 1, 2012, “(iii) 50 percent during the 1-year period beginning on January 1, 2013, and “(iv) 25 percent during the 1-year period beginning on January 1, 2014, or” ; (B) in paragraph (4) of subsection (b), by striking “except that” and all that follows through subparagraph (B) and inserting the following: “except that— “(A) in the case of a withdrawal for exportation of such a product to a NAFTA country, as defined in section 2(4) of the North American Free Trade Agreement Implementation Act, if any of the imported metal-bearing materials are goods subject to NAFTA drawback, as defined in section 203(a) of that Act, the duties on the materials shall be paid, and the charges against the bond canceled, before the 61st day after the date of exportation; but upon the presentation, before such 61st day, of satisfactory evidence of the amount of any customs duties paid to the NAFTA country on the product, the duties on the materials may be waived or reduced (subject to section 508(b)(2)(B)) in an amount that does not exceed the lesser of— “(i) the total amount of customs duties owed on the materials on importation into the United States, or “(ii) the total amount of customs duties paid to the NAFTA country on the product, and “(B) in the case of a withdrawal for exportation of such a product to Chile, if any of the imported metal-bearing materials are goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, the duties on the materials shall be paid, and the charges against the bond canceled, before the 61st day after the date of exportation, except that the duties may be waived or reduced by— “(i) 100 percent during the 8-year period beginning on January 1, 2004, “(ii) 75 percent during the 1-year period beginning on January 1, 2012, “(iii) 50 percent during the 1-year period beginning on January 1, 2013, and “(iv) 25 percent during the 1-year period beginning on January 1, 2014, or” ; and (C) in subsection (d), in the matter preceding paragraph (1), by striking “except that” and all that follows through the end of paragraph (2) and inserting the following: “except that— “(1) in the case of a withdrawal for exportation to a NAFTA country, as defined in section 2(4) of the North American Free Trade Agreement Implementation Act, if any of the imported metal-bearing materials are goods subject to NAFTA drawback, as defined in section 203(a) of that Act, charges against the bond shall be paid before the 61st day after the date of exportation; but upon the presentation, before such 61st day, of satisfactory evidence of the amount of any customs duties paid to the NAFTA country on the product, the bond shall be credited (subject to section 508(b)(2)(B)) in an amount not to exceed the lesser of— “(A) the total amount of customs duties paid or owed on the materials on importation into the United States, or “(B) the total amount of customs duties paid to the NAFTA country on the product; and “(2) in the case of a withdrawal for exportation to Chile, if any of the imported metal-bearing materials are goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, charges against the bond shall be paid before the 61st day after the date of exportation, and the bond shall be credited in an amount equal to— “(A) 100 percent of the total amount of customs duties paid or owed on the materials on importation into the United States during the 8-year period beginning on January 1, 2004, “(B) 75 percent of the total amount of customs duties paid or owed on the materials on importation into the United States during the 1-year period beginning on January 1, 2012, “(C) 50 percent of the total amount of customs duties paid or owed on the materials on importation into the United States during the 1-year period beginning on January 1, 2013, and “(D) 25 percent of the total amount of customs duties paid or owed on the materials on importation into the United States during the 1-year period beginning on January 1, 2014.” . (3) Drawback.— Section 313 of the Tariff Act of 1930 (19 U.S.C. 1313) is amended— (A) in paragraph (4) of subsection (j)— (i) by striking “(4)” and inserting “(4)(A)”; and (ii) by adding at the end the following new subparagraph: “(B) Effective date. Beginning on January 1, 2015, the exportation to Chile of merchandise that is fungible with and substituted for imported merchandise, other than merchandise described in paragraphs (1) through (5) of section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, shall not constitute an exportation for purposes of paragraph (2). The preceding sentence shall not be construed to permit the substitution of unused drawback under paragraph (2) of this subsection with respect to merchandise described in paragraph (2) of section 203(a) of the United States-Chile Free Trade Agreement Implementation Act.” ; (B) in subsection (n)— (i) by striking “(n)” and inserting the following: “(n) Refunds, Waivers, or Reductions Under Certain Free Trade Agreements.— ” ; (ii) in paragraph (1)— (I) by striking “; and” at the end of subparagraph (B); (II) by striking the period at the end of subparagraph (C) and inserting “; and”; and (III) by adding at the end the following new subparagraph: “(D) the term ‘good subject to Chile FTA drawback’ has the meaning given that term in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act.” ; and (iii) by adding the following new paragraph at the end: “(4) (A) For purposes of subsections (a), (b), (f), (h), (j)(2), (p), and (q), if an article that is exported to Chile is a good subject to Chile FTA drawback, no customs duties on the good may be refunded, waived, or reduced, except as provided in subparagraph (B). “(B) The customs duties referred to in subparagraph (A) may be refunded, waived, or reduced by— “(i) 100 percent during the 8-year period beginning on January 1, 2004; “(ii) 75 percent during the 1-year period beginning on January 1, 2012; “(iii) 50 percent during the 1-year period beginning on January 1, 2013; and “(iv) 25 percent during the 1-year period beginning on January 1, 2014.” ; and (C) in subsection (o)— (i) by striking “(o)” and inserting the following: “(o) Special Rules for Certain Vessels and Imported Materials.— ” ; and (ii) by adding at the end the following new paragraphs: “(3) For purposes of subsection (g), if— “(A) a vessel is built for the account and ownership of a resident of Chile or the Government of Chile, and “(B) imported materials that are used in the construction and equipment of the vessel are goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, no customs duties on such materials may be refunded, waived, or reduced, except as provided in paragraph (4). “(4) The customs duties referred to in paragraph (3) may be refunded, waived or reduced by— “(A) 100 percent during the 8-year period beginning on January 1, 2004; “(B) 75 percent during the 1-year period beginning on January 1, 2012; “(C) 50 percent during the 1-year period beginning on January 1, 2013; and “(D) 25 percent during the 1-year period beginning on January 1, 2014.” . (4) Manipulation in warehouse.— Section 562 of the Tariff Act of 1930 (19 U.S.C. 1562) is amended— (A) in paragraph (3), by striking “to a NAFTA country” and inserting “to Chile, to a NAFTA country,”; (B) by striking “and” at the end of paragraph (4)(B); (C) by striking the period at the end of paragraph (5) and inserting “; and”; and (D) by inserting after paragraph (5) the following: “(6) (A) without payment of duties for exportation to Chile, if the merchandise is of a kind described in any of paragraphs (1) through (5) of section 203(a) of the United States-Chile Free Trade Agreement Implementation Act; and “(B) for exportation to Chile if the merchandise consists of goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, except that— “(i) the merchandise may not be withdrawn from warehouse without assessment of a duty on the merchandise in its condition and quantity, and at its weight, at the time of withdrawal from the warehouse with such additions to, or deductions from, the final appraised value as may be necessary by reason of a change in condition, and “(ii) duty shall be paid on the merchandise before the 61st day after the date of exportation, except that such duties may be waived or reduced by— “(I) 100 percent during the 8-year period beginning on January 1, 2004, “(II) 75 percent during the 1-year period beginning on January 1, 2012, “(III) 50 percent during the 1-year period beginning on January 1, 2013, and “(IV) 25 percent during the 1-year period beginning on January 1, 2014.” . (5) Foreign trade zones.— Section 3(a) of the Act of June 18, 1934 (commonly known as the “Foreign Trade Zones Act”; 19 U.S.C. 81c(a)) is amended by striking the end period and inserting the following: “: Provided further, That no merchandise that consists of goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, that is manufactured or otherwise changed in condition shall be exported to Chile without an assessment of a duty on the merchandise in its condition and quantity, and at its weight, at the time of its exportation (or if the privilege in the first proviso to this subsection was requested, an assessment of a duty on the merchandise in its condition and quantity, and at its weight, at the time of its admission into the zone) and the payment of the assessed duty before the 61st day after the date of exportation of the article, except that the customs duty may be waived or reduced by (1) 100 percent during the 8-year period beginning on January 1, 2004; (2) 75 percent during the 1-year period beginning on January 1, 2012; (3) 50 percent during the 1-year period beginning on January 1, 2013; and (4) 25 percent during the 1-year period beginning on January 1, 2014.”. (c) Inapplicability to Countervailing and Antidumping Duties.— Nothing in this section or the amendments made by this section shall be considered to authorize the refund, waiver, or reduction of countervailing duties or antidumping duties imposed on an imported good. SEC. 204. CUSTOMS USER FEES.   Section 13031(b) of the Consolidated Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 58c(b)) is amended by inserting after paragraph (11) the following: “(12) No fee may be charged under subsection (a) (9) or (10) with respect to goods that qualify as originating goods under section 202 of the United States-Chile Free Trade Agreement Implementation Act. Any service for which an exemption from such fee is provided by reason of this paragraph may not be funded with money contained in the Customs User Fee Account.” . SEC. 205. DISCLOSURE OF INCORRECT INFORMATION; DENIAL OF PREFERENTIAL TARIFF TREATMENT; FALSE CERTIFICATES OF ORIGIN. (a) Disclosure of Incorrect Information.— Section 592 of the Tariff Act of 1930 (19 U.S.C. 1592) is amended— (1) in subsection (c)— (A) by redesignating paragraph (6) as paragraph (7); and (B) by inserting after paragraph (5) the following new paragraph: “(6) Prior disclosure regarding claims under the united states-chile free trade agreement.— An importer shall not be subject to penalties under subsection (a) for making an incorrect claim that a good qualifies as an originating good under section 202 of the United States-Chile Free Trade Agreement Implementation Act if the importer, in accordance with regulations issued by the Secretary of the Treasury, voluntarily makes a corrected declaration and pays any duties owing.” ; and (2) by adding at the end the following new subsection: “(g) False Certifications of Origin Under the United States-Chile Free Trade Agreement.— “(1) In general.— Subject to paragraph (2), it is unlawful for any person to certify falsely, by fraud, gross negligence, or negligence, in a Chile FTA Certificate of Origin (as defined in section 508(f)(1)(B) of this Act that a good exported from the United States qualifies as an originating good under the rules of origin set out in section 202 of the United States-Chile Free Trade Agreement Implementation Act. Applicability. The procedures and penalties of this section that apply to a violation of subsection (a) also apply to a violation of this subsection. “(2) Immediate and voluntary disclosure of incorrect information.— No penalty shall be imposed under this subsection if, immediately after an exporter or producer that issued a Chile FTA Certificate of Origin has reason to believe that such certificate contains or is based on incorrect information, the exporter or producer voluntarily provides written notice of such incorrect information to every person to whom the certificate was issued. “(3) Exception.— A person may not be considered to have violated paragraph (1) if— “(A) the information was correct at the time it was provided in a Chile FTA Certificate of Origin but was later rendered incorrect due to a change in circumstances; and “(B) the person immediately and voluntarily provides written notice of the change in circumstances to all persons to whom the person provided the certificate.” . (b) Denial of Preferential Tariff Treatment.— Section 514 of the Tariff Act of 1930 (19 U.S.C. 1514) is amended by adding at the end the following new subsection: “(g) Denial of Preferential Tariff Treatment Under United States-Chile Free Trade Agreement.— If the Bureau of Customs and Border Protection or the Bureau of Immigration and Customs Enforcement finds indications of a pattern of conduct by an importer of false or unsupported representations that goods qualify under the rules of origin set out in section 202 of the United States-Chile Free Trade Agreement Implementation Act, the Bureau of Customs and Border Protection, in accordance with regulations issued by the Secretary of the Treasury, may deny preferential tariff treatment under the United States-Chile Free Trade Agreement to entries of identical goods imported by that person until the person establishes to the satisfaction of the Bureau of Customs and Border Protection that representations of that person are in conformity with such section 202.” . SEC. 206. RELIQUIDATION OF ENTRIES.   Subsection (d) of section 520 of the Tariff Act of 1930 (19 U.S.C. 1520(d)) is amended— (1) by striking “(d)” and inserting the following: “(d) Goods Qualifying Under Free Trade Agreement Rules of Origin.— ” ; (2) in the matter preceding paragraph (1), by inserting “or section 202 of the United States-Chile Free Trade Agreement Implementation Act” after “Act”; (3) in paragraph (1), by striking “those” and inserting “the applicable”; and (4) in paragraph (2), by inserting before the semicolon “, or other certificates of origin, as the case may be”. SEC. 207. RECORDKEEPING REQUIREMENTS.   Section 508 of the Tariff Act of 1930 (19 U.S.C. 1508) is amended— (1) by striking the heading of subsection (b) and inserting the following: “Exportations to NAFTA Countries.—”; and (2) by adding at the end the following: “(f) Certificates of Origin for Goods Exported Under the United States-Chile Free Trade Agreement.— “(1) Definitions.— In this subsection: “(A) Records and supporting documents.— The term ‘records and supporting documents’ means, with respect to an exported good under paragraph (2), records and documents related to the origin of the good, including— “(i) the purchase, cost, and value of, and payment for, the good; “(ii) if applicable, the purchase, cost, and value of, and payment for, all materials, including recovered goods, used in the production of the good; and “(iii) if applicable, the production of the good in the form in which it was exported. “(B) Chile fta certificate of origin.— The term ‘Chile FTA Certificate of Origin’ means the certification, established under article 4.13 of the United States-Chile Free Trade Agreement, that a good qualifies as an originating good under such Agreement. “(2) Exports to chile.— Any person who completes and issues a Chile FTA Certificate of Origin for a good exported from the United States shall make, keep, and, pursuant to rules and regulations promulgated by the Secretary of the Treasury, render for examination and inspection all records and supporting documents related to the origin of the good (including the Certificate or copies thereof). “(3) Retention period.— Records and supporting documents shall be kept by the person who issued a Chile FTA Certificate of Origin for at least 5 years after the date on which the certificate was issued. “(g) Penalties.— Any person who fails to retain records and supporting documents required by subsection (f) or the regulations issued to implement that subsection shall be liable for the greater of— “(1) a civil penalty not to exceed $10,000; or “(2) the general record keeping penalty that applies under the customs laws of the United States.” . SEC. 208. ENFORCEMENT OF TEXTILE AND APPAREL RULES OF ORIGIN. (a) Action During Verification.— If the Secretary of the Treasury requests the Government of Chile to conduct a verification pursuant to article 3.21 of the Agreement for purposes of determining that— (1) an exporter or producer in Chile is complying with applicable customs laws, regulations, and procedures regarding trade in textile and apparel goods, or (2) claims that textile or apparel goods exported or produced by such exporter or producer— (A) qualify as originating goods under section 202 of this Act, or (B) are goods of Chile, are accurate, the President may direct the Secretary to take appropriate action described in subsection (b) while the verification is being conducted. (b) Appropriate Action Described.— Appropriate action under subsection (a) includes— (1) suspension of liquidation of entries of textile and apparel goods exported or produced by the person that is the subject of the verification, in a case in which the request for verification was based on a reasonable suspicion of unlawful activity related to such goods; and (2) publication of the name of the person that is the subject of the verification. (c) Action When Information is Insufficient.— If the Secretary of the Treasury determines that the information obtained within 12 months after making a request for a verification under subsection (a) is insufficient to make a determination under subsection (a), the President may direct the Secretary to take appropriate action described in subsection (d) until such time as the Secretary receives information sufficient to make a determination under subsection (a) or until such earlier date as the President may direct. (d) Appropriate Action Described.— Appropriate action under subsection (c) includes— (1) publication of the identity of the person that is the subject of the verification; (2) denial of preferential tariff treatment under the Agreement to any textile or apparel goods exported or produced by the person that is the subject of the verification; and (3) denial of entry into the United States of any textile or apparel goods exported or produced by the person that is the subject of the verification. SEC. 209. CONFORMING AMENDMENTS.   Section 508(b)(2)(B)(i)(I) of the Tariff Act of 1930 (19 U.S.C. 1508(b)(2)(B)(i)(I)) is amended— (1) by striking “the last paragraph of section 311” and inserting “the eleventh paragraph of section 311”; and (2) by striking “the last proviso to section 3(a)” and inserting “the proviso preceding the last proviso to section 3(a)”. SEC. 210. REGULATIONS.   The Secretary of the Treasury shall prescribe such regulations as may be necessary to carry out— (1) subsections (a) through (n) of section 202, and sections 203 and 204; (2) amendments made by the sections referred to in paragraph (1); and (3) proclamations issued under section 202(o).

11. 2003

    United States-Chile Free Trade Agreement Implementation Act

    Pub. L. 108–77 title II · 117 Stat. 909

    Added · 19 U.S.C. § 1508(f); 19 U.S.C. § 1508(g)

    Pub. L. 108–77, §§ 107(c), 207(2), temporarily added subsecs. (f) and (g). See Effective and Termination Dates of 2003 Amendment note below

    Source evidence

    Code amendment note
    Subsecs. (f), (g). Pub. L. 108–77, §§ 107(c), 207(2), temporarily added subsecs. (f) and (g). See Effective and Termination Dates of 2003 Amendment note below.

    Enacted provision · exact public law
    TITLE II— CUSTOMS PROVISIONS SEC. 201. TARIFF MODIFICATIONS. (a) Tariff Modifications Provided for in the Agreement.— (1) Proclamation authority.— The President may proclaim— (A) such modifications or continuation of any duty, (B) such continuation of duty-free or excise treatment, or (C) such additional duties, as the President determines to be necessary or appropriate to carry out or apply articles 3.3, 3.7, 3.9, article 3.20 (8), (9), (10), and (11), and Annex 3.3 of the Agreement. (2) Effect on chilean gsp status.— Notwithstanding section 502(a)(1) of the Trade Act of 1974 (19 U.S.C. 2462(a)(1)), the President shall terminate the designation of Chile as a beneficiary developing country for purposes of title V of the Trade Act of 1974 on the date of entry into force of the Agreement. (b) Other Tariff Modifications.— Subject to the consultation and layover provisions of section 103(a), the President may proclaim— (1) such modifications or continuation of any duty, (2) such modifications as the United States may agree to with Chile regarding the staging of any duty treatment set forth in Annex 3.3 of the Agreement, (3) such continuation of duty-free or excise treatment, or (4) such additional duties, as the President determines to be necessary or appropriate to maintain the general level of reciprocal and mutually advantageous concessions with respect to Chile provided for by the Agreement. (c) Additional Tariffs on Agricultural Safeguard Goods.— (1) In general.— In addition to any duty proclaimed under subsection (a) or (b), and subject to paragraphs (3) through (5), the Secretary of the Treasury shall assess a duty, in the amount prescribed under paragraph (2), on an agricultural safeguard good if the Secretary of the Treasury determines that the unit import price of the good when it enters the United States, determined on an F.O.B. basis, is less than the trigger price indicated for that good in Annex 3.18 of the Agreement or any amendment thereto. (2) Calculation of additional duty.— The amount of the additional duty assessed under this subsection shall be determined as follows: (A) If the difference between the unit import price and the trigger price is less than, or equal to, 10 percent of the trigger price, no additional duty shall be imposed. (B) If the difference between the unit import price and the trigger price is greater than 10 percent, but less than or equal to 40 percent, of the trigger price, the additional duty shall be equal to 30 percent of the difference between the preferential tariff rate and the column 1 general rate of duty imposed under the HTS on like articles at the time the additional duty is imposed. (C) If the difference between the unit import price and the trigger price is greater than 40 percent, but less than or equal to 60 percent, of the trigger price, the additional duty shall be equal to 50 percent of the difference between the preferential tariff rate and the column 1 general rate of duty imposed under the HTS on like articles at the time the additional duty is imposed. (D) If the difference between the unit import price and the trigger price is greater than 60 percent, but less than or equal to 75 percent, of the trigger price, the additional duty shall be equal to 70 percent of the difference between the preferential tariff rate and the column 1 general rate of duty imposed under the HTS on like articles at the time the additional duty is imposed. (E) If the difference between the unit import price and the trigger price is greater than 75 percent of the trigger price, the additional duty shall be equal to 100 percent of the difference between the preferential tariff rate and the column 1 general rate of duty imposed under the HTS on like articles at the time the additional duty is imposed. (3) Exceptions.— No additional duty under this subsection shall be assessed on an agricultural safeguard good if, at the time of entry, the good is subject to import relief under— (A) subtitle A of title III of this Act; or (B) chapter 1 of title II of the Trade Act of 1974 (19 U.S.C. 2251 et seq.). (4) Termination.— This Applicability. subsection shall cease to apply on the date that is 12 years after the date on which the Agreement enters into force. (5) Tariff-rate quotas.— If Applicability. an agricultural safeguard good is subject to a tariff-rate quota, and the in-quota duty rate for the good proclaimed pursuant to subsection (a) or (b) is zero, any additional duty assessed under this subsection shall be applied only to over-quota imports of the good. (6) Notice.— Not Deadline. later than 60 days after the Secretary of the Treasury first assesses additional duties on an agricultural safeguard good under this subsection, the Secretary shall notify the Government of Chile in writing of such action and shall provide to the Government of Chile data supporting the assessment of additional duties. (7) Modification of trigger prices.— Not later than 60 calendar days before agreeing with the Government of Chile pursuant to article 3.18(2)(b) of the Agreement on a modification to a trigger price for a good listed in Annex 3.18 of the Agreement, the President shall notify the Committees on Ways and Means and Agriculture of the House of Representatives and the Committees on Finance and Agriculture of the Senate of the proposed modification and the reasons therefor. (8) Definitions.— In this subsection: (A) Agricultural safeguard good.— The term “agricultural safeguard good” means a good— (i) that qualifies as an originating good under section 202; (ii) that is included in the United States Agricultural Safeguard Product List set forth in Annex 3.18 of the Agreement; and (iii) for which a claim for preferential tariff treatment under the Agreement has been made. (B) F.O.B.— The term “F.O.B.” means free on board, regardless of the mode of transportation, at the point of direct shipment by the seller to the buyer. (C) Unit import price.— The term “unit import price” means the price expressed in dollars per kilogram. (d) Conversion to Ad Valorem Rates.— For purposes of subsections (a) and (b), with respect to any good for which the base rate in the Schedule of the United States to Annex 3.3 of the Agreement is a specific or compound rate of duty, the President may substitute for the base rate an ad valorem rate that the President determines to be equivalent to the base rate. SEC. 202. RULES OF ORIGIN. (a) Originating Goods.— (1) In general.— For purposes of this Act and for purposes of implementing the tariff treatment provided for under the Agreement, except as otherwise provided in this section, a good is an originating good if— (A) the good is wholly obtained or produced entirely in the territory of Chile, the United States, or both; (B) the good— (i) is produced entirely in the territory of Chile, the United States, or both, and (I) each of the nonoriginating materials used in the production of the good undergoes an applicable change in tariff classification specified in Annex 4.1 of the Agreement, or (II) the good otherwise satisfies any applicable regional value-content or other requirements specified in Annex 4.1 of the Agreement; and (ii) satisfies all other applicable requirements of this section; or (C) the good is produced entirely in the territory of Chile, the United States, or both, exclusively from materials described in subparagraph (A) or (B). (2) Simple combination or mere dilution.— A good shall not be considered to be an originating good and a material shall not be considered to be an originating material by virtue of having undergone— (A) simple combining or packaging operations; or (B) mere dilution with water or another substance that does not materially alter the characteristics of the good or material. (b) De Minimis Amounts of Nonoriginating Materials.— (1) In general.— Except as provided in paragraphs (2) and (3), a good that does not undergo a change in tariff classification pursuant to Annex 4.1 of the Agreement is an originating good if— (A) the value of all nonoriginating materials that are used in the production of the good and do not undergo the applicable change in tariff classification does not exceed 10 percent of the adjusted value of the good; (B) the value of such nonoriginating materials is included in the value of nonoriginating materials for any applicable regional value-content requirement; and (C) the good meets all other applicable requirements of this section. (2) Exceptions.— Paragraph (1) does not apply to the following: (A) A nonoriginating material provided for in chapter 4 of the HTS, or a nonoriginating dairy preparation containing over 10 percent by weight of milk solids provided for in subheading 1901.90 or 2106.90 of the HTS, that is used in the production of a good provided for in chapter 4 of the HTS. (B) A nonoriginating material provided for in chapter 4 of the HTS, or nonoriginating dairy preparations containing over 10 percent by weight of milk solids provided for in subheading 1901.90 of the HTS, that are used in the production of the following goods: (i) Infant preparations containing over 10 percent in weight of milk solids provided for in subheading 1901.10 of the HTS. (ii) Mixes and doughs, containing over 25 percent by weight of butterfat, not put up for retail sale, provided for in subheading 1901.20 of the HTS. (iii) Dairy preparations containing over 10 percent by weight of milk solids provided for in subheading 1901.90 or 2106.90 of the HTS. (iv) Goods provided for in heading 2105 of the HTS. (v) Beverages containing milk provided for in subheading 2202.90 of the HTS. (vi) Animal feeds containing over 10 percent by weight of milk solids provided for in subheading 2309.90 of the HTS. (C) A nonoriginating material provided for in heading 0805 of the HTS, or any of subheadings 2009.11.00 through 2009.39 of the HTS, that is used in the production of a good provided for in any of subheadings 2009.11.00 through 2009.39 of the HTS, or in fruit or vegetable juice of any single fruit or vegetable, fortified with minerals or vitamins, concentrated or unconcentrated, provided for in subheading 2106.90 or 2202.90 of the HTS. (D) A nonoriginating material provided for in chapter 15 of the HTS that is used in the production of a good provided for in any of headings 1501.00.00 through 1508, 1512, 1514, and 1515 of the HTS. (E) A nonoriginating material provided for in heading 1701 of the HTS that is used in the production of a good provided for in any of headings 1701 through 1703 of the HTS. (F) A nonoriginating material provided for in chapter 17 of the HTS or in heading 1805.00.00 of the HTS that is used in the production of a good provided for in subheading 1806.10 of the HTS. (G) A nonoriginating material provided for in any of headings 2203 through 2208 of the HTS that is used in the production of a good provided for in heading 2207 or 2208 of the HTS. (H) A nonoriginating material used in the production of a good provided for in any of chapters 1 through 21 of the HTS, unless the nonoriginating material is provided for in a different subheading than the good for which origin is being determined under this section. (3) Goods provided for in chapters 50 through 63 of the hts.— (A) In general.— Except as provided in subparagraph (B), a good provided for in any of chapters 50 through 63 of the HTS that is not an originating good because certain fibers or yarns used in the production of the component of the good that determines the tariff classification of the good do not undergo an applicable change in tariff classification set out in Annex 4.1 of the Agreement, shall be considered to be an originating good if the total weight of all such fibers or yarns in that component is not more than 7 percent of the total weight of that component. (B) Certain textile or apparel goods.— A textile or apparel good containing elastomeric yarns in the component of the good that determines the tariff classification of the good shall be considered to be an originating good only if such yarns are wholly formed in the territory of Chile or the United States. (c) Accumulation.— (1) Originating goods incorporated in goods of other country.— Originating goods or materials of Chile or the United States that are incorporated into a good in the territory of the other country shall be considered to originate in the territory of the other country. (2) Multiple procedures.— A good that is produced in the territory of Chile, the United States, or both, by 1 or more producers, is an originating good if the good satisfies the requirements of subsection (a) and all other applicable requirements of this section. (d) Regional Value-Content.— (1) In general.— For purposes of subsection (a)(2), the regional value-content of a good referred to in Annex 4.1 of the Agreement shall be calculated, at the choice of the person claiming preferential tariff treatment for the good, on the basis of the build-down method described in paragraph (2) or the build-up method described in paragraph (3), unless otherwise provided in Annex 4.1 of the Agreement. (2) Build-down method.— (A) In general.— The regional value-content of a good may be calculated on the basis of the following build-down method:  RVC =AV - VNM× 100  AV     (B) Definitions.— For purposes of subparagraph (A): (i) The term “RVC” means the regional value-content, expressed as a percentage. (ii) The term “AV” means the adjusted value. (iii) The term “VNM” means the value of nonoriginating materials used by the producer in the production of the good. (3) Build-up method.— (A) In general.— The regional value-content of a good may be calculated on the basis of the following build-up method:  RVC =VOM× 100  AV     (B) Definitions.— For purposes of subparagraph (A): (i) The term “RVC” means the regional value-content, expressed as a percentage. (ii) The term “AV” means the adjusted value. (iii) The term “VOM” means the value of originating materials used by the producer in the production of the good. (e) Value of Materials.— (1) In general.— For purposes of calculating the regional value-content of a good under subsection (d), and for purposes of applying the de minimis rules under subsection (b), the value of a material is— (A) in the case of a material that is imported by the producer of the good, the adjusted value of the material with respect to that importation; (B) in the case of a material acquired in the territory in which the good is produced, except for a material to which subparagraph (C) applies, the producer’s price actually paid or payable for the material; (C) in the case of a material provided to the producer without charge, or at a price reflecting a discount or similar reduction, the sum of— (i) all expenses incurred in the growth, production, or manufacture of the material, including general expenses; and (ii) an amount for profit; or (D) in the case of a material that is self-produced, the sum of— (i) all expenses incurred in the production of the material, including general expenses; and (ii) an amount for profit. (2) Further adjustments to the value of materials.— (A) Originating materials.— The following expenses, if not included in the value of an originating material calculated under paragraph (1), may be added to the value of the originating material: (i) The costs of freight, insurance, packing, and all other costs incurred in transporting the material to the location of the producer. (ii) Duties, taxes, and customs brokerage fees on the material paid in the territory of Chile, the United States, or both, other than duties and taxes that are waived, refunded, refundable, or otherwise recoverable, including credit against duty or tax paid or payable. (iii) The cost of waste and spoilage resulting from the use of the material in the production of the good, less the value of renewable scrap or byproduct. (B) Nonoriginating materials.— The following expenses, if included in the value of a nonoriginating material calculated under paragraph (1), may be deducted from the value of the nonoriginating material: (i) The costs of freight, insurance, packing, and all other costs incurred in transporting the material to the location of the producer. (ii) Duties, taxes, and customs brokerage fees on the material paid in the territory of Chile, the United States, or both, other than duties and taxes that are waived, refunded, refundable, or otherwise recoverable, including credit against duty or tax paid or payable. (iii) The cost of waste and spoilage resulting from the use of the material in the production of the good, less the value of renewable scrap or byproducts. (iv) The cost of originating materials used in the production of the nonoriginating material in the territory of Chile or the United States. (f) Accessories, Spare Parts, or Tools.— Accessories, spare parts, or tools delivered with a good that form part of the good’s standard accessories, spare parts, or tools shall be regarded as a material used in the production of the good, if— (1) the accessories, spare parts, or tools are classified with and not invoiced separately from the good; and (2) the quantities and value of the accessories, spare parts, or tools are customary for the good. (g) Fungible Goods and Materials.— (1) In general.— (A) Claim for preferential treatment.— A person claiming preferential tariff treatment for a good may claim that a fungible good or material is originating either based on the physical segregation of each fungible good or material or by using an inventory management method. (B) Inventory management method.— In this subsection, the term “inventory management method” means— (i) averaging; (ii) “last-in, first-out”; (iii) “first-in, first-out”; or (iv) any other method— (I) recognized in the generally accepted accounting principles of the country in which the production is performed (whether Chile or the United States); or (II) otherwise accepted by that country. (2) Election of inventory method.— A person selecting an inventory management method under paragraph (1) for particular fungible goods or materials shall continue to use that method for those goods or materials throughout the fiscal year of that person. (h) Packaging Materials and Containers for Retail Sale.— Packaging materials and containers in which a good is packaged for retail sale, if classified with the good, shall be disregarded in determining whether all nonoriginating materials used in the production of the good undergo the applicable change in tariff classification set out in Annex 4.1 of the Agreement, and, if the good is subject to a regional value-content requirement, the value of such packaging materials and containers shall be taken into account as originating or nonoriginating materials, as the case may be, in calculating the regional value-content of the good. (i) Packing Materials and Containers for Shipment.— Packing materials and containers for shipment shall be disregarded in determining whether— (1) the nonoriginating materials used in the production of the good undergo an applicable change in tariff classification set out in Annex 4.1 of the Agreement; and (2) the good satisfies a regional value-content requirement. (j) Indirect Materials.— An indirect material shall be considered to be an originating material without regard to where it is produced. (k) Transit and Transshipment.— A good that has undergone production necessary to qualify as an originating good under subsection (a) shall not be considered to be an originating good if, subsequent to that production, the good undergoes further production or any other operation outside the territory of Chile or the United States, other than unloading, reloading, or any other process necessary to preserve the good in good condition or to transport the good to the territory of Chile or the United States. (l) Textile and Apparel Goods Classifiable as Goods Put Up in Sets.— Notwithstanding the rules set forth in Annex 4.1 of the Agreement, textile and apparel goods classifiable as goods put up in sets for retail sale as provided for in General Rule of Interpretation 3 of the Harmonized System shall not be considered to be originating goods unless each of the goods in the set is an originating good or the total value of the nonoriginating goods in the set does not exceed 10 percent of the value of the set determined for purposes of assessing customs duties. (m) Application and Interpretation.— In this section: (1) The basis for any tariff classification is the HTS. (2) Records. Any cost or value referred to in this section shall be recorded and maintained in accordance with the generally accepted accounting principles applicable in the territory of the country in which the good is produced (whether Chile or the United States). (n) Definitions.— In this section: (1) Adjusted value.— The term “adjusted value” means the value determined in accordance with articles 1 through 8, article 15, and the corresponding interpretive notes of the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994 referred to in section 101(d)(8) of the Uruguay Round Agreements Act, except that such value may be adjusted to exclude any costs, charges, or expenses incurred for transportation, insurance, and related services incident to the international shipment of the merchandise from the country of exportation to the place of importation. (2) Fungible goods or fungible materials.— The terms “fungible goods” and “fungible materials” mean goods or materials, as the case may be, that are interchangeable for commercial purposes and the properties of which are essentially identical. (3) Generally accepted accounting principles.— The term “generally accepted accounting principles” means the principles, rules, and procedures, including both broad and specific guidelines, that define the accounting practices accepted in the territory of Chile or the United States, as the case may be. (4) Goods wholly obtained or produced entirely in the territory of chile, the united states, or both.— The term “goods wholly obtained or produced entirely in the territory of Chile, the United States, or both” means— (A) mineral goods extracted in the territory of Chile, the United States, or both; (B) vegetable goods, as such goods are defined in the Harmonized System, harvested in the territory of Chile, the United States, or both; (C) live animals born and raised in the territory of Chile, the United States, or both; (D) goods obtained from hunting, trapping, or fishing in the territory of Chile, the United States, or both; (E) goods (fish, shellfish, and other marine life) taken from the sea by vessels registered or recorded with Chile or the United States and flying the flag of that country; (F) goods produced on board factory ships from the goods referred to in subparagraph (E), if such factory ships are registered or recorded with Chile or the United States and fly the flag of that country; (G) goods taken by Chile or the United States or a person of Chile or the United States from the seabed or beneath the seabed outside territorial waters, if Chile or the United States has rights to exploit such seabed; (H) goods taken from outer space, if the goods are obtained by Chile or the United States or a person of Chile or the United States and not processed in the territory of a country other than Chile or the United States; (I) waste and scrap derived from— (i) production in the territory of Chile, the United States, or both; or (ii) used goods collected in the territory of Chile, the United States, or both, if such goods are fit only for the recovery of raw materials; (J) recovered goods derived in the territory of Chile or the United States from used goods, and used in the territory of that country in the production of remanufactured goods; and (K) goods produced in the territory of Chile, the United States, or both, exclusively— (i) from goods referred to in any of subparagraphs (A) through (I), or (ii) from the derivatives of goods referred to in clause (i), at any stage of production. (5) Harmonized system.— The term “Harmonized System” means the Harmonized Commodity Description and Coding System. (6) Indirect material.— The term “indirect material” means a good used in the production, testing, or inspection of a good but not physically incorporated into the good, or a good used in the maintenance of buildings or the operation of equipment associated with the production of a good, including— (A) fuel and energy; (B) tools, dies, and molds; (C) spare parts and materials used in the maintenance of equipment or buildings; (D) lubricants, greases, compounding materials, and other materials used in production or used to operate equipment or buildings; (E) gloves, glasses, footwear, clothing, safety equipment, and supplies; (F) equipment, devices, and supplies used for testing or inspecting the good; (G) catalysts and solvents; and (H) any other goods that are not incorporated into the good but the use of which in the production of the good can reasonably be demonstrated to be a part of that production. (7) Material.— The term “material” means a good that is used in the production of another good, including a part, ingredient, or indirect material. (8) Material that is self-produced.— The term “material that is self-produced” means a material that is an originating good produced by a producer of a good and used in the production of that good. (9) Nonoriginating good or nonoriginating material.— The terms “nonoriginating good” and “nonoriginating material” mean a good or material, as the case may be, that does not qualify as an originating good under this section. (10) Packing materials and containers for shipment.— The term “packing materials and containers for shipment” means the goods used to protect a good during its transportation, and does not include the packaging materials and containers in which a good is packaged for retail sale. (11) Preferential tariff treatment.— The term “preferential tariff treatment” means the customs duty rate that is applicable to an originating good pursuant to chapter 3 of the Agreement. (12) Producer.— The term “producer” means a person who engages in the production of a good in the territory of Chile or the United States. (13) Production.— The term “production” means growing, mining, harvesting, fishing, raising, trapping, hunting, manufacturing, processing, assembling, or disassembling a good. (14) Recovered goods.— (A) In general.— The term “recovered goods” means materials in the form of individual parts that are the result of— (i) the complete disassembly of used goods into individual parts; and (ii) the cleaning, inspecting, testing, or other processing of those parts as necessary for improvement to sound working condition by one or more of the processes described in subparagraph (B), in order for such parts to be assembled with other parts, including other parts that have undergone the processes described in this paragraph, in the production of a remanufactured good. (B) Processes.— The processes referred to in subparagraph (A)(ii) are welding, flame spraying, surface machining, knurling, plating, sleeving, and rewinding. (15) Remanufactured good.— The term “remanufactured good” means an industrial good assembled in the territory of Chile or the United States, that is listed in Annex 4.18 of the Agreement, and— (A) is entirely or partially comprised of recovered goods; (B) has the same life expectancy and meets the same performance standards as a new good; and (C) enjoys the same factory warranty as such a new good. (o) Presidential Proclamation Authority.— (1) In general.— The President is authorized to proclaim, as part of the HTS— (A) the provisions set out in Annex 4.1 of the Agreement; and (B) any additional subordinate category necessary to carry out this title consistent with the Agreement. (2) Modifications.— (A) In general.— Subject to the consultation and layover provisions of section 103(a), the President may proclaim modifications to the provisions proclaimed under the authority of paragraph (1)(A), other than provisions of chapters 50 through 63 of the HTS, as included in Annex 4.1 of the Agreement. (B) Additional proclamations.— Notwithstanding subparagraph (A), and subject to the consultation and layover provisions of section 103(a), the President may proclaim— (i) modifications to the provisions proclaimed under the authority of paragraph (1)(A) that are necessary to implement an agreement with Chile pursuant to article 3.20(5) of the Agreement; and (ii) before the 1st anniversary of the date of the enactment of this Act, modifications to correct any typographical, clerical, or other nonsubstantive technical error regarding the provisions of chapters 50 through 63 of the HTS, as included in Annex 4.1 of the Agreement. SEC. 203. DRAWBACK. (a) Definition of a Good Subject to Chile FTA Drawback.— For purposes of this Act and the amendments made by subsection (b), the term “good subject to Chile FTA drawback” means any imported good other than the following: (1) A good entered under bond for transportation and exportation to Chile. (2) (A) A good exported to Chile in the same condition as when imported into the United States. (B) For purposes of subparagraph (A)— (i) processes such as testing, cleaning, repacking, inspecting, sorting, or marking a good, or preserving it in its same condition, shall not be considered to change the condition of the good; and (ii) if a good described in subparagraph (A) is commingled with fungible goods and exported in the same condition, the origin of the good for the purposes of subsection (j)(1) of section 313 of the Tariff Act of 1930 (19 U.S.C. 1313(j)(1)) may be determined on the basis of the inventory methods provided for in the regulations implementing this title. (3) A good— (A) that is— (i) deemed to be exported from the United States; (ii) used as a material in the production of another good that is deemed to be exported to Chile; or (iii) substituted for by a good of the same kind and quality that is used as a material in the production of another good that is deemed to be exported to Chile; and (B) that is delivered— (i) to a duty-free shop; (ii) for ship’s stores or supplies for a ship or aircraft; or (iii) for use in a project undertaken jointly by the United States and Chile and destined to become the property of the United States. (4) A good exported to Chile for which a refund of customs duties is granted by reason of— (A) the failure of the good to conform to sample or specification; or (B) the shipment of the good without the consent of the consignee. (5) A good that qualifies under the rules of origin set out in section 202 that is— (A) exported to Chile; (B) used as a material in the production of another good that is exported to Chile; or (C) substituted for by a good of the same kind and quality that is used as a material in the production of another good that is exported to Chile. (b) Consequential Amendments.— (1) Bonded manufacturing warehouses.— Section 311 of the Tariff Act of 1930 (19 U.S.C. 1311) is amended by adding at the end the following new paragraph:   “No article manufactured in a bonded warehouse from materials that are goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, may be withdrawn from warehouse for exportation to Chile without assessment of a duty on the materials in their condition and quantity, and at their weight, at the time of importation into the United States. The duty shall be paid before the 61st day after the date of exportation, except that the duty may be waived or reduced by— “(1) 100 percent during the 8-year period beginning on January 1, 2004; “(2) 75 percent during the 1-year period beginning on January 1, 2012; “(3) 50 percent during the 1-year period beginning on January 1, 2013; and “(4) 25 percent during the 1-year period beginning on January 1, 2014.” . (2) Bonded smelting and refining warehouses.— Section 312 of the Tariff Act of 1930 (19 U.S.C. 1312) is amended— (A) in paragraph (1) of subsection (b), by striking “except that” and all that follows through subparagraph (B) and inserting the following: “except that— “(A) in the case of a withdrawal for exportation of such a product to a NAFTA country, as defined in section 2(4) of the North American Free Trade Agreement Implementation Act, if any of the imported metal-bearing materials are goods subject to NAFTA drawback, as defined in section 203(a) of that Act, the duties on the materials shall be paid, and the charges against the bond canceled, before the 61st day after the date of exportation; but upon the presentation, before such 61st day, of satisfactory evidence of the amount of any customs duties paid to the NAFTA country on the product, the duties on the materials may be waived or reduced (subject to section 508(b)(2)(B)) in an amount that does not exceed the lesser of— “(i) the total amount of customs duties owed on the materials on importation into the United States, or “(ii) the total amount of customs duties paid to the NAFTA country on the product, and “(B) in the case of a withdrawal for exportation of such a product to Chile, if any of the imported metal-bearing materials are goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, the duties on the materials shall be paid, and the charges against the bond canceled, before the 61st day after the date of exportation, except that the duties may be waived or reduced by— “(i) 100 percent during the 8-year period beginning on January 1, 2004, “(ii) 75 percent during the 1-year period beginning on January 1, 2012, “(iii) 50 percent during the 1-year period beginning on January 1, 2013, and “(iv) 25 percent during the 1-year period beginning on January 1, 2014, or” ; (B) in paragraph (4) of subsection (b), by striking “except that” and all that follows through subparagraph (B) and inserting the following: “except that— “(A) in the case of a withdrawal for exportation of such a product to a NAFTA country, as defined in section 2(4) of the North American Free Trade Agreement Implementation Act, if any of the imported metal-bearing materials are goods subject to NAFTA drawback, as defined in section 203(a) of that Act, the duties on the materials shall be paid, and the charges against the bond canceled, before the 61st day after the date of exportation; but upon the presentation, before such 61st day, of satisfactory evidence of the amount of any customs duties paid to the NAFTA country on the product, the duties on the materials may be waived or reduced (subject to section 508(b)(2)(B)) in an amount that does not exceed the lesser of— “(i) the total amount of customs duties owed on the materials on importation into the United States, or “(ii) the total amount of customs duties paid to the NAFTA country on the product, and “(B) in the case of a withdrawal for exportation of such a product to Chile, if any of the imported metal-bearing materials are goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, the duties on the materials shall be paid, and the charges against the bond canceled, before the 61st day after the date of exportation, except that the duties may be waived or reduced by— “(i) 100 percent during the 8-year period beginning on January 1, 2004, “(ii) 75 percent during the 1-year period beginning on January 1, 2012, “(iii) 50 percent during the 1-year period beginning on January 1, 2013, and “(iv) 25 percent during the 1-year period beginning on January 1, 2014, or” ; and (C) in subsection (d), in the matter preceding paragraph (1), by striking “except that” and all that follows through the end of paragraph (2) and inserting the following: “except that— “(1) in the case of a withdrawal for exportation to a NAFTA country, as defined in section 2(4) of the North American Free Trade Agreement Implementation Act, if any of the imported metal-bearing materials are goods subject to NAFTA drawback, as defined in section 203(a) of that Act, charges against the bond shall be paid before the 61st day after the date of exportation; but upon the presentation, before such 61st day, of satisfactory evidence of the amount of any customs duties paid to the NAFTA country on the product, the bond shall be credited (subject to section 508(b)(2)(B)) in an amount not to exceed the lesser of— “(A) the total amount of customs duties paid or owed on the materials on importation into the United States, or “(B) the total amount of customs duties paid to the NAFTA country on the product; and “(2) in the case of a withdrawal for exportation to Chile, if any of the imported metal-bearing materials are goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, charges against the bond shall be paid before the 61st day after the date of exportation, and the bond shall be credited in an amount equal to— “(A) 100 percent of the total amount of customs duties paid or owed on the materials on importation into the United States during the 8-year period beginning on January 1, 2004, “(B) 75 percent of the total amount of customs duties paid or owed on the materials on importation into the United States during the 1-year period beginning on January 1, 2012, “(C) 50 percent of the total amount of customs duties paid or owed on the materials on importation into the United States during the 1-year period beginning on January 1, 2013, and “(D) 25 percent of the total amount of customs duties paid or owed on the materials on importation into the United States during the 1-year period beginning on January 1, 2014.” . (3) Drawback.— Section 313 of the Tariff Act of 1930 (19 U.S.C. 1313) is amended— (A) in paragraph (4) of subsection (j)— (i) by striking “(4)” and inserting “(4)(A)”; and (ii) by adding at the end the following new subparagraph: “(B) Effective date. Beginning on January 1, 2015, the exportation to Chile of merchandise that is fungible with and substituted for imported merchandise, other than merchandise described in paragraphs (1) through (5) of section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, shall not constitute an exportation for purposes of paragraph (2). The preceding sentence shall not be construed to permit the substitution of unused drawback under paragraph (2) of this subsection with respect to merchandise described in paragraph (2) of section 203(a) of the United States-Chile Free Trade Agreement Implementation Act.” ; (B) in subsection (n)— (i) by striking “(n)” and inserting the following: “(n) Refunds, Waivers, or Reductions Under Certain Free Trade Agreements.— ” ; (ii) in paragraph (1)— (I) by striking “; and” at the end of subparagraph (B); (II) by striking the period at the end of subparagraph (C) and inserting “; and”; and (III) by adding at the end the following new subparagraph: “(D) the term ‘good subject to Chile FTA drawback’ has the meaning given that term in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act.” ; and (iii) by adding the following new paragraph at the end: “(4) (A) For purposes of subsections (a), (b), (f), (h), (j)(2), (p), and (q), if an article that is exported to Chile is a good subject to Chile FTA drawback, no customs duties on the good may be refunded, waived, or reduced, except as provided in subparagraph (B). “(B) The customs duties referred to in subparagraph (A) may be refunded, waived, or reduced by— “(i) 100 percent during the 8-year period beginning on January 1, 2004; “(ii) 75 percent during the 1-year period beginning on January 1, 2012; “(iii) 50 percent during the 1-year period beginning on January 1, 2013; and “(iv) 25 percent during the 1-year period beginning on January 1, 2014.” ; and (C) in subsection (o)— (i) by striking “(o)” and inserting the following: “(o) Special Rules for Certain Vessels and Imported Materials.— ” ; and (ii) by adding at the end the following new paragraphs: “(3) For purposes of subsection (g), if— “(A) a vessel is built for the account and ownership of a resident of Chile or the Government of Chile, and “(B) imported materials that are used in the construction and equipment of the vessel are goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, no customs duties on such materials may be refunded, waived, or reduced, except as provided in paragraph (4). “(4) The customs duties referred to in paragraph (3) may be refunded, waived or reduced by— “(A) 100 percent during the 8-year period beginning on January 1, 2004; “(B) 75 percent during the 1-year period beginning on January 1, 2012; “(C) 50 percent during the 1-year period beginning on January 1, 2013; and “(D) 25 percent during the 1-year period beginning on January 1, 2014.” . (4) Manipulation in warehouse.— Section 562 of the Tariff Act of 1930 (19 U.S.C. 1562) is amended— (A) in paragraph (3), by striking “to a NAFTA country” and inserting “to Chile, to a NAFTA country,”; (B) by striking “and” at the end of paragraph (4)(B); (C) by striking the period at the end of paragraph (5) and inserting “; and”; and (D) by inserting after paragraph (5) the following: “(6) (A) without payment of duties for exportation to Chile, if the merchandise is of a kind described in any of paragraphs (1) through (5) of section 203(a) of the United States-Chile Free Trade Agreement Implementation Act; and “(B) for exportation to Chile if the merchandise consists of goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, except that— “(i) the merchandise may not be withdrawn from warehouse without assessment of a duty on the merchandise in its condition and quantity, and at its weight, at the time of withdrawal from the warehouse with such additions to, or deductions from, the final appraised value as may be necessary by reason of a change in condition, and “(ii) duty shall be paid on the merchandise before the 61st day after the date of exportation, except that such duties may be waived or reduced by— “(I) 100 percent during the 8-year period beginning on January 1, 2004, “(II) 75 percent during the 1-year period beginning on January 1, 2012, “(III) 50 percent during the 1-year period beginning on January 1, 2013, and “(IV) 25 percent during the 1-year period beginning on January 1, 2014.” . (5) Foreign trade zones.— Section 3(a) of the Act of June 18, 1934 (commonly known as the “Foreign Trade Zones Act”; 19 U.S.C. 81c(a)) is amended by striking the end period and inserting the following: “: Provided further, That no merchandise that consists of goods subject to Chile FTA drawback, as defined in section 203(a) of the United States-Chile Free Trade Agreement Implementation Act, that is manufactured or otherwise changed in condition shall be exported to Chile without an assessment of a duty on the merchandise in its condition and quantity, and at its weight, at the time of its exportation (or if the privilege in the first proviso to this subsection was requested, an assessment of a duty on the merchandise in its condition and quantity, and at its weight, at the time of its admission into the zone) and the payment of the assessed duty before the 61st day after the date of exportation of the article, except that the customs duty may be waived or reduced by (1) 100 percent during the 8-year period beginning on January 1, 2004; (2) 75 percent during the 1-year period beginning on January 1, 2012; (3) 50 percent during the 1-year period beginning on January 1, 2013; and (4) 25 percent during the 1-year period beginning on January 1, 2014.”. (c) Inapplicability to Countervailing and Antidumping Duties.— Nothing in this section or the amendments made by this section shall be considered to authorize the refund, waiver, or reduction of countervailing duties or antidumping duties imposed on an imported good. SEC. 204. CUSTOMS USER FEES.   Section 13031(b) of the Consolidated Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 58c(b)) is amended by inserting after paragraph (11) the following: “(12) No fee may be charged under subsection (a) (9) or (10) with respect to goods that qualify as originating goods under section 202 of the United States-Chile Free Trade Agreement Implementation Act. Any service for which an exemption from such fee is provided by reason of this paragraph may not be funded with money contained in the Customs User Fee Account.” . SEC. 205. DISCLOSURE OF INCORRECT INFORMATION; DENIAL OF PREFERENTIAL TARIFF TREATMENT; FALSE CERTIFICATES OF ORIGIN. (a) Disclosure of Incorrect Information.— Section 592 of the Tariff Act of 1930 (19 U.S.C. 1592) is amended— (1) in subsection (c)— (A) by redesignating paragraph (6) as paragraph (7); and (B) by inserting after paragraph (5) the following new paragraph: “(6) Prior disclosure regarding claims under the united states-chile free trade agreement.— An importer shall not be subject to penalties under subsection (a) for making an incorrect claim that a good qualifies as an originating good under section 202 of the United States-Chile Free Trade Agreement Implementation Act if the importer, in accordance with regulations issued by the Secretary of the Treasury, voluntarily makes a corrected declaration and pays any duties owing.” ; and (2) by adding at the end the following new subsection: “(g) False Certifications of Origin Under the United States-Chile Free Trade Agreement.— “(1) In general.— Subject to paragraph (2), it is unlawful for any person to certify falsely, by fraud, gross negligence, or negligence, in a Chile FTA Certificate of Origin (as defined in section 508(f)(1)(B) of this Act that a good exported from the United States qualifies as an originating good under the rules of origin set out in section 202 of the United States-Chile Free Trade Agreement Implementation Act. Applicability. The procedures and penalties of this section that apply to a violation of subsection (a) also apply to a violation of this subsection. “(2) Immediate and voluntary disclosure of incorrect information.— No penalty shall be imposed under this subsection if, immediately after an exporter or producer that issued a Chile FTA Certificate of Origin has reason to believe that such certificate contains or is based on incorrect information, the exporter or producer voluntarily provides written notice of such incorrect information to every person to whom the certificate was issued. “(3) Exception.— A person may not be considered to have violated paragraph (1) if— “(A) the information was correct at the time it was provided in a Chile FTA Certificate of Origin but was later rendered incorrect due to a change in circumstances; and “(B) the person immediately and voluntarily provides written notice of the change in circumstances to all persons to whom the person provided the certificate.” . (b) Denial of Preferential Tariff Treatment.— Section 514 of the Tariff Act of 1930 (19 U.S.C. 1514) is amended by adding at the end the following new subsection: “(g) Denial of Preferential Tariff Treatment Under United States-Chile Free Trade Agreement.— If the Bureau of Customs and Border Protection or the Bureau of Immigration and Customs Enforcement finds indications of a pattern of conduct by an importer of false or unsupported representations that goods qualify under the rules of origin set out in section 202 of the United States-Chile Free Trade Agreement Implementation Act, the Bureau of Customs and Border Protection, in accordance with regulations issued by the Secretary of the Treasury, may deny preferential tariff treatment under the United States-Chile Free Trade Agreement to entries of identical goods imported by that person until the person establishes to the satisfaction of the Bureau of Customs and Border Protection that representations of that person are in conformity with such section 202.” . SEC. 206. RELIQUIDATION OF ENTRIES.   Subsection (d) of section 520 of the Tariff Act of 1930 (19 U.S.C. 1520(d)) is amended— (1) by striking “(d)” and inserting the following: “(d) Goods Qualifying Under Free Trade Agreement Rules of Origin.— ” ; (2) in the matter preceding paragraph (1), by inserting “or section 202 of the United States-Chile Free Trade Agreement Implementation Act” after “Act”; (3) in paragraph (1), by striking “those” and inserting “the applicable”; and (4) in paragraph (2), by inserting before the semicolon “, or other certificates of origin, as the case may be”. SEC. 207. RECORDKEEPING REQUIREMENTS.   Section 508 of the Tariff Act of 1930 (19 U.S.C. 1508) is amended— (1) by striking the heading of subsection (b) and inserting the following: “Exportations to NAFTA Countries.—”; and (2) by adding at the end the following: “(f) Certificates of Origin for Goods Exported Under the United States-Chile Free Trade Agreement.— “(1) Definitions.— In this subsection: “(A) Records and supporting documents.— The term ‘records and supporting documents’ means, with respect to an exported good under paragraph (2), records and documents related to the origin of the good, including— “(i) the purchase, cost, and value of, and payment for, the good; “(ii) if applicable, the purchase, cost, and value of, and payment for, all materials, including recovered goods, used in the production of the good; and “(iii) if applicable, the production of the good in the form in which it was exported. “(B) Chile fta certificate of origin.— The term ‘Chile FTA Certificate of Origin’ means the certification, established under article 4.13 of the United States-Chile Free Trade Agreement, that a good qualifies as an originating good under such Agreement. “(2) Exports to chile.— Any person who completes and issues a Chile FTA Certificate of Origin for a good exported from the United States shall make, keep, and, pursuant to rules and regulations promulgated by the Secretary of the Treasury, render for examination and inspection all records and supporting documents related to the origin of the good (including the Certificate or copies thereof). “(3) Retention period.— Records and supporting documents shall be kept by the person who issued a Chile FTA Certificate of Origin for at least 5 years after the date on which the certificate was issued. “(g) Penalties.— Any person who fails to retain records and supporting documents required by subsection (f) or the regulations issued to implement that subsection shall be liable for the greater of— “(1) a civil penalty not to exceed $10,000; or “(2) the general record keeping penalty that applies under the customs laws of the United States.” . SEC. 208. ENFORCEMENT OF TEXTILE AND APPAREL RULES OF ORIGIN. (a) Action During Verification.— If the Secretary of the Treasury requests the Government of Chile to conduct a verification pursuant to article 3.21 of the Agreement for purposes of determining that— (1) an exporter or producer in Chile is complying with applicable customs laws, regulations, and procedures regarding trade in textile and apparel goods, or (2) claims that textile or apparel goods exported or produced by such exporter or producer— (A) qualify as originating goods under section 202 of this Act, or (B) are goods of Chile, are accurate, the President may direct the Secretary to take appropriate action described in subsection (b) while the verification is being conducted. (b) Appropriate Action Described.— Appropriate action under subsection (a) includes— (1) suspension of liquidation of entries of textile and apparel goods exported or produced by the person that is the subject of the verification, in a case in which the request for verification was based on a reasonable suspicion of unlawful activity related to such goods; and (2) publication of the name of the person that is the subject of the verification. (c) Action When Information is Insufficient.— If the Secretary of the Treasury determines that the information obtained within 12 months after making a request for a verification under subsection (a) is insufficient to make a determination under subsection (a), the President may direct the Secretary to take appropriate action described in subsection (d) until such time as the Secretary receives information sufficient to make a determination under subsection (a) or until such earlier date as the President may direct. (d) Appropriate Action Described.— Appropriate action under subsection (c) includes— (1) publication of the identity of the person that is the subject of the verification; (2) denial of preferential tariff treatment under the Agreement to any textile or apparel goods exported or produced by the person that is the subject of the verification; and (3) denial of entry into the United States of any textile or apparel goods exported or produced by the person that is the subject of the verification. SEC. 209. CONFORMING AMENDMENTS.   Section 508(b)(2)(B)(i)(I) of the Tariff Act of 1930 (19 U.S.C. 1508(b)(2)(B)(i)(I)) is amended— (1) by striking “the last paragraph of section 311” and inserting “the eleventh paragraph of section 311”; and (2) by striking “the last proviso to section 3(a)” and inserting “the proviso preceding the last proviso to section 3(a)”. SEC. 210. REGULATIONS.   The Secretary of the Treasury shall prescribe such regulations as may be necessary to carry out— (1) subsections (a) through (n) of section 202, and sections 203 and 204; (2) amendments made by the sections referred to in paragraph (1); and (3) proclamations issued under section 202(o).

12. 2005

    Dominican Republic-Central America-United States Free Trade Agreement Implementation Act

    Pub. L. 109–53 title II § 208 · 119 Stat. 462

    Redesignated · 19 U.S.C. § 1508(g)

    Pub. L. 109–53, §§ 107(d), 208(2), temporarily added subsec. (g). Former subsec. (g) redesignated (h). See Effective and Termination Dates of 2005 Amendment note below

    Source evidence

    Code amendment note
    Subsec. (g). Pub. L. 109–53, §§ 107(d), 208(2), temporarily added subsec. (g). Former subsec. (g) redesignated (h). See Effective and Termination Dates of 2005 Amendment note below.

    Enacted provision · exact public law section
    SEC. 208. RECORDKEEPING REQUIREMENTS.   Section 508 of the Tariff Act of 1930 (19 U.S.C. 1508) is amended— (1) by redesignating subsection (g) as subsection (h); (2) by inserting after subsection (f) the following new subsection: “(g) Certifications of Origin for Goods Exported Under the Dominican Republic-Central America-United States Free Trade Agreement.— “(1) Definitions.— In this subsection: “(A) Records and supporting documents.— The term ‘records and supporting documents’ means, with respect to an exported good under paragraph (2), records and documents related to the origin of the good, including— “(i) the purchase, cost, and value of, and payment for, the good; “(ii) the purchase, cost, and value of, and payment for, all materials, including indirect materials, used in the production of the good; and “(iii) the production of the good in the form in which it was exported. “(B) CAFTA–DR certification of origin.— The term ‘CAFTA–DR certification of origin’ means the certification established under article 4.16 of the Dominican Republic-Central America-United States Free Trade Agreement that a good qualifies as an originating good under such Agreement. “(2) Exports to cafta–dr countries.— Any person who completes and issues a CAFTA–DR certification of origin for a good exported from the United States shall make, keep, and, pursuant to rules and regulations promulgated by the Secretary of the Treasury, render for examination and inspection all records and supporting documents related to the origin of the good (including the certification or copies thereof). “(3) Retention period.— Records and supporting documents shall be kept by the person who issued a CAFTA–DR certification of origin for at least 5 years after the date on which the certification was issued.” ; and (3) in subsection (h), as so redesignated— (A) by inserting “or (g)” after “(f)”; and (B) by striking “that subsection” and inserting “either such subsection”.

13. 2005

    Dominican Republic-Central America-United States Free Trade Agreement Implementation Act

    Pub. L. 109–53 title II § 208 · 119 Stat. 462

    1. Redesignated · 19 U.S.C. § 1508(h)

       Pub. L. 109–53, §§ 107(d), 208(1), (3), temporarily redesignated subsec. (g) as (h) and, in introductory provisions

    2. Inserted · 19 U.S.C. § 1508(h)

       Pub. L. 109–53, §§ 107(d), 208(1), (3), temporarily inserted “or (g)” after “(f)”

    3. Substituted · 19 U.S.C. § 1508(h)

       Pub. L. 109–53, §§ 107(d), 208(1), (3), temporarily substituted “either such subsection” for “that subsection”. See Effective and Termination Dates of 2005 Amendment note below

    Source evidence

    Code amendment note
    Subsec. (h). Pub. L. 109–53, §§ 107(d), 208(1), (3), temporarily redesignated subsec. (g) as (h) and, in introductory provisions, inserted “or (g)” after “(f)” and substituted “either such subsection” for “that subsection”. See Effective and Termination Dates of 2005 Amendment note below.

    Enacted provision · exact public law section
    SEC. 208. RECORDKEEPING REQUIREMENTS.   Section 508 of the Tariff Act of 1930 (19 U.S.C. 1508) is amended— (1) by redesignating subsection (g) as subsection (h); (2) by inserting after subsection (f) the following new subsection: “(g) Certifications of Origin for Goods Exported Under the Dominican Republic-Central America-United States Free Trade Agreement.— “(1) Definitions.— In this subsection: “(A) Records and supporting documents.— The term ‘records and supporting documents’ means, with respect to an exported good under paragraph (2), records and documents related to the origin of the good, including— “(i) the purchase, cost, and value of, and payment for, the good; “(ii) the purchase, cost, and value of, and payment for, all materials, including indirect materials, used in the production of the good; and “(iii) the production of the good in the form in which it was exported. “(B) CAFTA–DR certification of origin.— The term ‘CAFTA–DR certification of origin’ means the certification established under article 4.16 of the Dominican Republic-Central America-United States Free Trade Agreement that a good qualifies as an originating good under such Agreement. “(2) Exports to cafta–dr countries.— Any person who completes and issues a CAFTA–DR certification of origin for a good exported from the United States shall make, keep, and, pursuant to rules and regulations promulgated by the Secretary of the Treasury, render for examination and inspection all records and supporting documents related to the origin of the good (including the certification or copies thereof). “(3) Retention period.— Records and supporting documents shall be kept by the person who issued a CAFTA–DR certification of origin for at least 5 years after the date on which the certification was issued.” ; and (3) in subsection (h), as so redesignated— (A) by inserting “or (g)” after “(f)”; and (B) by striking “that subsection” and inserting “either such subsection”.

14. 2007

    United States-Peru Trade Promotion Agreement Implementation Act

    Pub. L. 110–138 title II § 207 · 121 Stat. 1455

    Redesignated · 19 U.S.C. § 1508(h)

    Pub. L. 110–138, §§ 107(c), 207(2), temporarily added subsec. (h). Former subsec. (h) redesignated (i). See Effective and Termination Dates of 2007 Amendment note below

    Source evidence

    Code amendment note
    Subsec. (h). Pub. L. 110–138, §§ 107(c), 207(2), temporarily added subsec. (h). Former subsec. (h) redesignated (i). See Effective and Termination Dates of 2007 Amendment note below.

    Enacted provision · exact public law section
    SEC. 207. RECORDKEEPING REQUIREMENTS.   Section 508 of the Tariff Act of 1930 (19 U.S.C. 1508) is amended— (1) by redesignating subsection (h) as subsection (i); (2) by inserting after subsection (g) the following new subsection: “(h) Certifications of Origin for Goods Exported Under the United States-Peru Trade Promotion Agreement.— “(1) Definitions.— In this subsection: “(A) Records and supporting documents.— The term ‘records and supporting documents’ means, with respect to an exported good under paragraph (2), records and documents related to the origin of the good, including— “(i) the purchase, cost, and value of, and payment for, the good; “(ii) the purchase, cost, and value of, and payment for, all materials, including indirect materials, used in the production of the good; and “(iii) the production of the good in the form in which it was exported. “(B) PTPA certification of origin.— The term ‘PTPA certification of origin’ means the certification established under article 4.15 of the United States-Peru Trade Promotion Agreement that a good qualifies as an originating good under such Agreement. “(2) Exports to peru.— Any person who completes and issues a PTPA certification of origin for a good exported from the United States shall make, keep, and, pursuant to rules and regulations promulgated by the Secretary of the Treasury, render for examination and inspection all records and supporting documents related to the origin of the good (including the certification or copies thereof). “(3) Retention period.— The person who issues a PTPA certification of origin shall keep the records and supporting documents relating to that certification of origin for a period of at least 5 years after the date on which the certification is issued.” ; and (3) in subsection (i), as so redesignated— (A) by striking “(f) or (g)” and inserting “(f), (g), or (h)”; and (B) by striking “either such subsection” and inserting “any such subsection”.

15. 2007

    United States-Peru Trade Promotion Agreement Implementation Act

    Pub. L. 110–138 title II § 207 · 121 Stat. 1455

    1. Redesignated · 19 U.S.C. § 1508(i)

       Pub. L. 110–138, §§ 107(c), 207(1), (3), temporarily redesignated subsec. (h) as (i) and, in introductory provisions

    2. Substituted · 19 U.S.C. § 1508(i)

       Pub. L. 110–138, §§ 107(c), 207(1), (3), temporarily substituted “(f), (g), or (h)” for “(f) or (g)” . See Effective and Termination Dates of 2007 Amendment note below

    3. Substituted · 19 U.S.C. § 1508(i)

       Pub. L. 110–138, §§ 107(c), 207(1), (3), temporarily substituted “any such subsection” for “either such subsection” . See Effective and Termination Dates of 2007 Amendment note below

    Source evidence

    Code amendment note
    Subsec. (i). Pub. L. 110–138, §§ 107(c), 207(1), (3), temporarily redesignated subsec. (h) as (i) and, in introductory provisions, substituted “(f), (g), or (h)” for “(f) or (g)” and “any such subsection” for “either such subsection”. See Effective and Termination Dates of 2007 Amendment note below.

    Enacted provision · exact public law section
    SEC. 207. RECORDKEEPING REQUIREMENTS.   Section 508 of the Tariff Act of 1930 (19 U.S.C. 1508) is amended— (1) by redesignating subsection (h) as subsection (i); (2) by inserting after subsection (g) the following new subsection: “(h) Certifications of Origin for Goods Exported Under the United States-Peru Trade Promotion Agreement.— “(1) Definitions.— In this subsection: “(A) Records and supporting documents.— The term ‘records and supporting documents’ means, with respect to an exported good under paragraph (2), records and documents related to the origin of the good, including— “(i) the purchase, cost, and value of, and payment for, the good; “(ii) the purchase, cost, and value of, and payment for, all materials, including indirect materials, used in the production of the good; and “(iii) the production of the good in the form in which it was exported. “(B) PTPA certification of origin.— The term ‘PTPA certification of origin’ means the certification established under article 4.15 of the United States-Peru Trade Promotion Agreement that a good qualifies as an originating good under such Agreement. “(2) Exports to peru.— Any person who completes and issues a PTPA certification of origin for a good exported from the United States shall make, keep, and, pursuant to rules and regulations promulgated by the Secretary of the Treasury, render for examination and inspection all records and supporting documents related to the origin of the good (including the certification or copies thereof). “(3) Retention period.— The person who issues a PTPA certification of origin shall keep the records and supporting documents relating to that certification of origin for a period of at least 5 years after the date on which the certification is issued.” ; and (3) in subsection (i), as so redesignated— (A) by striking “(f) or (g)” and inserting “(f), (g), or (h)”; and (B) by striking “either such subsection” and inserting “any such subsection”.

16. 2011

    United States–Korea Free Trade Agreement Implementation Act

    Pub. L. 112–41 title II § 206 · 125 Stat. 449

    Redesignated · 19 U.S.C. § 1508(i)

    Pub. L. 112–41, §§ 107(c), 206(2), temporarily added subsec. (i). Former subsec. (i) redesignated (j). See Effective and Termination Dates of 2011 Amendment note below

    Source evidence

    Code amendment note
    Subsec. (i). Pub. L. 112–41, §§ 107(c), 206(2), temporarily added subsec. (i). Former subsec. (i) redesignated (j). See Effective and Termination Dates of 2011 Amendment note below.

    Enacted provision · exact public law section
    SEC. 206. RECORDKEEPING REQUIREMENTS.   Section 508 of the Tariff Act of 1930 (19 U.S.C. 1508) is amended— (1) by redesignating subsection (i) as subsection (j); (2) by inserting after subsection (h) the following new subsection: “(i) Certifications of Origin for Goods Exported Under the United States–Korea Free Trade Agreement.— “(1) Definitions.— In this subsection: “(A) Records and supporting documents.— The term ‘records and supporting documents’ means, with respect to an exported good under paragraph (2), records and documents related to the origin of the good, including— “(i) the purchase, cost, and value of, and payment for, the good; “(ii) the purchase, cost, and value of, and payment for, all materials, including indirect materials, used in the production of the good; and “(iii) the production of the good in the form in which it was exported. “(B) KFTA certification of origin.— The term ‘KFTA certification of origin’ means the certification established under article 6.15 of the United States–Korea Free Trade Agreement that a good qualifies as an originating good under such Agreement. “(2) Exports to korea.— Any person who completes and issues a KFTA certification of origin for a good exported from the United States shall make, keep, and, pursuant to rules and regulations promulgated by the Secretary of the Treasury, render for examination and inspection all records and supporting documents related to the origin of the good (including the certification or copies thereof). “(3) Retention period.— The person who issues a KFTA certification of origin shall keep the records and supporting documents relating to that certification of origin for a period of at least 5 years after the date on which the certification is issued.” ; and (3) in subsection (j), as so redesignated, by striking “(g), or (h)” and inserting “(g), (h), or (i)”.

17. 2011

    United States–Colombia Trade Promotion Agreement Implementation Act

    Pub. L. 112–42 title II § 207 · 125 Stat. 484

    Redesignated · 19 U.S.C. § 1508(j)

    Pub. L. 112–42, §§ 107(c), 207(2), temporarily added subsec. (j). Former subsec. (j) redesignated (k). See Effective and Termination Dates of 2011 Amendment note below

    Source evidence

    Code amendment note
    Subsec. (j). Pub. L. 112–42, §§ 107(c), 207(2), temporarily added subsec. (j). Former subsec. (j) redesignated (k). See Effective and Termination Dates of 2011 Amendment note below.

    Enacted provision · exact public law section
    SEC. 207. RECORDKEEPING REQUIREMENTS.   Section 508 of the Tariff Act of 1930 (19 U.S.C. 1508) is amended— (1) by redesignating subsection (j) as subsection (k); (2) by inserting after subsection (i) the following new subsection: “(j) Certifications of Origin for Goods Exported Under the United States–Colombia Trade Promotion Agreement.— “(1) Definitions.— In this subsection: “(A) Records and supporting documents.— The term ‘records and supporting documents’ means, with respect to an exported good under paragraph (2), records and documents related to the origin of the good, including— “(i) the purchase, cost, and value of, and payment for, the good; “(ii) the purchase, cost, and value of, and payment for, all materials, including indirect materials, used in the production of the good; and “(iii) the production of the good in the form in which it was exported. “(B) CTPA certification of origin.— The term ‘CTPA certification of origin’ means the certification established under article 4.15 of the United States–Colombia Trade Promotion Agreement that a good qualifies as an originating good under such Agreement. “(2) Exports to colombia.— Any person who completes and issues a CTPA certification of origin for a good exported from the United States shall make, keep, and, pursuant to rules and regulations promulgated by the Secretary of the Treasury, render for examination and inspection all records and supporting documents related to the origin of the good (including the certification or copies thereof). “(3) Retention period.— The person who issues a CTPA certification of origin shall keep the records and supporting documents relating to that certification of origin for a period of at least 5 years after the date on which the certification is issued.” ; and (3) in subsection (k), as so redesignated by striking “(h), or (i)” and inserting “(h), (i), or (j)”.

18. 2011

    United States–Korea Free Trade Agreement Implementation Act

    Pub. L. 112–41 title II § 206 · 125 Stat. 449

    1. Redesignated · 19 U.S.C. § 1508(j)

       Pub. L. 112–41, §§ 107(c), 206(1), (3), temporarily redesignated subsec. (i) as (j) and, in introductory provisions

    2. Substituted · 19 U.S.C. § 1508(j)

       Pub. L. 112–41, §§ 107(c), 206(1), (3), temporarily substituted “(g), (h), or (i)” for “(g), or (h)”. See Effective and Termination Dates of 2011 Amendment note below

    Target inherited from the preceding amendment note.

    Source evidence

    Code amendment note
    Pub. L. 112–41, §§ 107(c), 206(1), (3), temporarily redesignated subsec. (i) as (j) and, in introductory provisions, substituted “(g), (h), or (i)” for “(g), or (h)”. See Effective and Termination Dates of 2011 Amendment note below.

    Enacted provision · exact public law section
    SEC. 206. RECORDKEEPING REQUIREMENTS.   Section 508 of the Tariff Act of 1930 (19 U.S.C. 1508) is amended— (1) by redesignating subsection (i) as subsection (j); (2) by inserting after subsection (h) the following new subsection: “(i) Certifications of Origin for Goods Exported Under the United States–Korea Free Trade Agreement.— “(1) Definitions.— In this subsection: “(A) Records and supporting documents.— The term ‘records and supporting documents’ means, with respect to an exported good under paragraph (2), records and documents related to the origin of the good, including— “(i) the purchase, cost, and value of, and payment for, the good; “(ii) the purchase, cost, and value of, and payment for, all materials, including indirect materials, used in the production of the good; and “(iii) the production of the good in the form in which it was exported. “(B) KFTA certification of origin.— The term ‘KFTA certification of origin’ means the certification established under article 6.15 of the United States–Korea Free Trade Agreement that a good qualifies as an originating good under such Agreement. “(2) Exports to korea.— Any person who completes and issues a KFTA certification of origin for a good exported from the United States shall make, keep, and, pursuant to rules and regulations promulgated by the Secretary of the Treasury, render for examination and inspection all records and supporting documents related to the origin of the good (including the certification or copies thereof). “(3) Retention period.— The person who issues a KFTA certification of origin shall keep the records and supporting documents relating to that certification of origin for a period of at least 5 years after the date on which the certification is issued.” ; and (3) in subsection (j), as so redesignated, by striking “(g), or (h)” and inserting “(g), (h), or (i)”.

19. 2011

    United States–Panama Trade Promotion Agreement Implementation Act

    Pub. L. 112–43 title II § 207 · 125 Stat. 520

    Redesignated · 19 U.S.C. § 1508(k)

    Pub. L. 112–43, §§ 107(c), 207(2), temporarily added subsec. (k). Former subsec. (k) redesignated (l). See Effective and Termination Dates of 2011 Amendment note below

    Source evidence

    Code amendment note
    Subsec. (k). Pub. L. 112–43, §§ 107(c), 207(2), temporarily added subsec. (k). Former subsec. (k) redesignated (l). See Effective and Termination Dates of 2011 Amendment note below.

    Enacted provision · exact public law section
    SEC. 207. RECORDKEEPING REQUIREMENTS.   Section 508 of the Tariff Act of 1930 (19 U.S.C. 1508) is amended— (1) by redesignating subsection (k) as subsection (l); (2) by inserting after subsection (j) the following new subsection: “(k) Certifications of Origin for Goods Exported Under the United States–panama Trade Promotion Agreement.— “(1) Definitions.— In this subsection: “(A) Records and supporting documents.— The term ‘records and supporting documents’ means, with respect to an exported good under paragraph (2), records and documents related to the origin of the good, including— “(i) the purchase, cost, and value of, and payment for, the good; “(ii) the purchase, cost, and value of, and payment for, all materials, including indirect materials, used in the production of the good; and “(iii) the production of the good in the form in which it was exported. “(B) Panama tpa certification of origin.— The term ‘Panama TPA certification of origin’ means the certification established under article 4.15 of the United States–Panama Trade Promotion Agreement that a good qualifies as an originating good under such Agreement. “(2) Exports to panama.— Any person who completes and issues a Panama TPA certification of origin for a good exported from the United States shall make, keep, and, pursuant to rules and regulations promulgated by the Secretary of the Treasury, render for examination and inspection all records and supporting documents related to the origin of the good (including the certification or copies thereof). “(3) Retention period.— The person who issues a Panama TPA certification of origin shall keep the records and supporting documents relating to that certification of origin for a period of at least 5 years after the date on which the certification is issued.” ; and (3) in subsection (l), as so redesignated, by striking “(i), or (j)” and inserting “(i), (j), or (k)”.

20. 2011

    United States–Colombia Trade Promotion Agreement Implementation Act

    Pub. L. 112–42 title II § 207 · 125 Stat. 484

    1. Redesignated · 19 U.S.C. § 1508(k)

       Pub. L. 112–42, §§ 107(c), 207(1), (3), temporarily redesignated former subsec. (j) as (k) and, in introductory provisions

    2. Substituted · 19 U.S.C. § 1508(k)

       Pub. L. 112–42, §§ 107(c), 207(1), (3), temporarily substituted “(h), (i), or (j)” for “(h), or (i)”. See Effective and Termination Dates of 2011 Amendment note below

    Target inherited from the preceding amendment note.

    Source evidence

    Code amendment note
    Pub. L. 112–42, §§ 107(c), 207(1), (3), temporarily redesignated former subsec. (j) as (k) and, in introductory provisions, substituted “(h), (i), or (j)” for “(h), or (i)”. See Effective and Termination Dates of 2011 Amendment note below.

    Enacted provision · exact public law section
    SEC. 207. RECORDKEEPING REQUIREMENTS.   Section 508 of the Tariff Act of 1930 (19 U.S.C. 1508) is amended— (1) by redesignating subsection (j) as subsection (k); (2) by inserting after subsection (i) the following new subsection: “(j) Certifications of Origin for Goods Exported Under the United States–Colombia Trade Promotion Agreement.— “(1) Definitions.— In this subsection: “(A) Records and supporting documents.— The term ‘records and supporting documents’ means, with respect to an exported good under paragraph (2), records and documents related to the origin of the good, including— “(i) the purchase, cost, and value of, and payment for, the good; “(ii) the purchase, cost, and value of, and payment for, all materials, including indirect materials, used in the production of the good; and “(iii) the production of the good in the form in which it was exported. “(B) CTPA certification of origin.— The term ‘CTPA certification of origin’ means the certification established under article 4.15 of the United States–Colombia Trade Promotion Agreement that a good qualifies as an originating good under such Agreement. “(2) Exports to colombia.— Any person who completes and issues a CTPA certification of origin for a good exported from the United States shall make, keep, and, pursuant to rules and regulations promulgated by the Secretary of the Treasury, render for examination and inspection all records and supporting documents related to the origin of the good (including the certification or copies thereof). “(3) Retention period.— The person who issues a CTPA certification of origin shall keep the records and supporting documents relating to that certification of origin for a period of at least 5 years after the date on which the certification is issued.” ; and (3) in subsection (k), as so redesignated by striking “(h), or (i)” and inserting “(h), (i), or (j)”.

21. 2011

    United States–Panama Trade Promotion Agreement Implementation Act

    Pub. L. 112–43 title II § 207 · 125 Stat. 520

    1. Redesignated · 19 U.S.C. § 1508(l)

       Pub. L. 112–43, §§ 107(c), 207(1), (3), temporarily redesignated subsec. (k) as (l), and, in introductory provisions

    2. Substituted · 19 U.S.C. § 1508(l)

       Pub. L. 112–43, §§ 107(c), 207(1), (3), temporarily substituted “(i), (j), or (k)” for “(i), or (j)”. See Effective and Termination Dates of 2011 Amendment note below

    Source evidence

    Code amendment note
    Subsec. (l). Pub. L. 112–43, §§ 107(c), 207(1), (3), temporarily redesignated subsec. (k) as (l), and, in introductory provisions, substituted “(i), (j), or (k)” for “(i), or (j)”. See Effective and Termination Dates of 2011 Amendment note below.

    Enacted provision · exact public law section
    SEC. 207. RECORDKEEPING REQUIREMENTS.   Section 508 of the Tariff Act of 1930 (19 U.S.C. 1508) is amended— (1) by redesignating subsection (k) as subsection (l); (2) by inserting after subsection (j) the following new subsection: “(k) Certifications of Origin for Goods Exported Under the United States–panama Trade Promotion Agreement.— “(1) Definitions.— In this subsection: “(A) Records and supporting documents.— The term ‘records and supporting documents’ means, with respect to an exported good under paragraph (2), records and documents related to the origin of the good, including— “(i) the purchase, cost, and value of, and payment for, the good; “(ii) the purchase, cost, and value of, and payment for, all materials, including indirect materials, used in the production of the good; and “(iii) the production of the good in the form in which it was exported. “(B) Panama tpa certification of origin.— The term ‘Panama TPA certification of origin’ means the certification established under article 4.15 of the United States–Panama Trade Promotion Agreement that a good qualifies as an originating good under such Agreement. “(2) Exports to panama.— Any person who completes and issues a Panama TPA certification of origin for a good exported from the United States shall make, keep, and, pursuant to rules and regulations promulgated by the Secretary of the Treasury, render for examination and inspection all records and supporting documents related to the origin of the good (including the certification or copies thereof). “(3) Retention period.— The person who issues a Panama TPA certification of origin shall keep the records and supporting documents relating to that certification of origin for a period of at least 5 years after the date on which the certification is issued.” ; and (3) in subsection (l), as so redesignated, by striking “(i), or (j)” and inserting “(i), (j), or (k)”.

22. 2016

    Trade Facilitation and Trade Enforcement Act of 2015

    Pub. L. 114–125 title IX § 906 · 130 Stat. 122

    Substituted · 19 U.S.C. § 1508(c)(3)

    Pub. L. 114–125 substituted “liquidation” for “payment”

    Source evidence

    Code amendment note
    Subsec. (c)(3). Pub. L. 114–125 substituted “liquidation” for “payment”.

    Enacted provision · exact public law section
    SEC. 906. DRAWBACK AND REFUNDS. (a) Articles Made From Imported Merchandise.— Section 313(a) of the Tariff Act of 1930 (19 U.S.C. 1313(a)) is amended by striking “the full amount of the duties paid upon the merchandise so used shall be refunded as drawback, less 1 per centum of such duties, except that such” and inserting “an amount calculated pursuant to regulations prescribed by the Secretary of the Treasury under subsection (l) shall be refunded as drawback, except that”. (b) Substitution for Drawback Purposes.— Section 313(b) of the Tariff Act of 1930 (19 U.S.C. 1313(b)) is amended— (1) by striking “If imported” and inserting the following: “(1) In general.— If imported” ; (2) by striking “and any other merchandise (whether imported or domestic) of the same kind and quality are” and inserting “or merchandise classifiable under the same 8-digit HTS subheading number as such imported merchandise is”; (3) by striking “three years” and inserting “5 years”; (4) by striking “the receipt of such imported merchandise by the manufacturer or producer of such articles” and inserting “the date of importation of such imported merchandise”; (5) by striking “an amount of drawback equal to” and all that follows through the end period and inserting “an amount calculated pursuant to regulations prescribed by the Secretary of the Treasury under subsection (l), but only if those articles have not been used prior to such exportation or destruction.”; and (6) by adding at the end the following: “(2) Requirements relating to transfer of merchandise.— “(A) Manufacturers and producers.— Drawback shall be allowed under paragraph (1) with respect to an article manufactured or produced using imported merchandise or other merchandise classifiable under the same 8-digit HTS subheading number as such imported merchandise only if the manufacturer or producer of the article received such imported merchandise or such other merchandise, directly or indirectly, from the importer. “(B) Exporters and destroyers.— Drawback shall be allowed under paragraph (1) with respect to a manufactured or produced article that is exported or destroyed only if the exporter or destroyer received that article, directly or indirectly, from the manufacturer or producer. “(C) Evidence of transfer.— Transfers of merchandise under subparagraph (A) and transfers of articles under subparagraph (B) may be evidenced by business records kept in the normal course of business and no additional certificates of transfer or manufacture shall be required. “(3) Submission of bill of materials or formula.— “(A) In general.— Drawback shall be allowed under paragraph (1) with respect to an article manufactured or produced using imported merchandise or other merchandise classifiable under the same 8-digit HTS subheading number as such imported merchandise only if the person making the drawback claim submits with the claim a bill of materials or formula identifying the merchandise and article by the 8-digit HTS subheading number and the quantity of the merchandise. “(B) Bill of materials and formula defined.— In this paragraph, the terms ‘bill of materials’ and ‘formula’ mean records kept in the normal course of business that identify each component incorporated into a manufactured or produced article or that identify the quantity of each element, material, chemical, mixture, or other substance incorporated into a manufactured article. “(4) Special rule for sought chemical elements.— “(A) In general.— For purposes of paragraph (1), a sought chemical element may be— “(i) considered imported merchandise, or merchandise classifiable under the same 8-digit HTS subheading number as such imported merchandise, used in the manufacture or production of an article as described in paragraph (1); and “(ii) substituted for source material containing that sought chemical element, without regard to whether the sought chemical element and the source material are classifiable under the same 8-digit HTS subheading number, and apportioned quantitatively, as appropriate. “(B) Sought chemical element defined.— In this paragraph, the term ‘sought chemical element’ means an element listed in the Periodic Table of Elements that is imported into the United States or a chemical compound consisting of those elements, either separately in elemental form or contained in source material.” . (c) Merchandise Not Conforming to Sample or Specifications.— Section 313(c) of the Tariff Act of 1930 (19 U.S.C. 1313(c)) is amended— (1) in paragraph (1)— (A) in subparagraph (C)(ii), by striking “under a certificate of delivery” each place it appears; (B) in subparagraph (D)— (i) by striking “3” and inserting “5”; and (ii) by striking “the Customs Service” and inserting “U.S. Customs and Border Protection”; and (C) in the flush text at the end, by striking “the full amount of the duties paid upon such merchandise, less 1 percent,” and inserting “an amount calculated pursuant to regulations prescribed by the Secretary of the Treasury under subsection (l)”; (2) in paragraph (2), by striking “the Customs Service” and inserting “U.S. Customs and Border Protection”; and (3) by amending paragraph (3) to read as follows: “(3) Evidence of transfers.— Transfers of merchandise under paragraph (1) may be evidenced by business records kept in the normal course of business and no additional certificates of transfer shall be required.” . (d) Proof of Exportation.— Section 313(i) of the Tariff Act of 1930 (19 U.S.C. 1313(i)) is amended to read as follows: “(i) Proof of Exportation.— A person claiming drawback under this section based on the exportation of an article shall provide proof of the exportation of the article. Such proof of exportation— “(1) shall establish fully the date and fact of exportation and the identity of the exporter; and “(2) may be established through the use of records kept in the normal course of business or through an electronic export system of the United States Government, as determined by the Commissioner of U.S. Customs and Border Protection.” . (e) Unused Merchandise Drawback.— Section 313(j) of the Tariff Act of 1930 (19 U.S.C. 1313(j)) is amended— (1) in paragraph (1)— (A) in subparagraph (A), in the matter preceding clause (i)— (i) by striking “3-year” and inserting “5-year”; and (ii) by inserting “and before the drawback claim is filed” after “the date of importation”; and (B) in the flush text at the end, by striking “99 percent of the amount of each duty, tax, or fee so paid” and inserting “an amount calculated pursuant to regulations prescribed by the Secretary of the Treasury under subsection (l)”; (2) in paragraph (2)— (A) in the matter preceding subparagraph (A), by striking “paragraph (4)” and inserting “paragraphs (4), (5), and (6)”; (B) in subparagraph (A), by striking “commercially interchangeable with” and inserting “classifiable under the same 8-digit HTS subheading number as”; (C) in subparagraph (B)— (i) by striking “3-year” and inserting “5-year”; and (ii) by inserting “and before the drawback claim is filed” after “the imported merchandise”; (D) in subparagraph (C)(ii), by striking subclause (II) and inserting the following: “(II) received the imported merchandise, other merchandise classifiable under the same 8-digit HTS subheading number as such imported merchandise, or any combination of such imported merchandise and such other merchandise, directly or indirectly from the person who imported and paid any duties, taxes, and fees imposed under Federal law upon importation or entry and due on the imported merchandise (and any such transferred merchandise, regardless of its origin, will be treated as the imported merchandise and any retained merchandise will be treated as domestic merchandise);” ; and (E) in the flush text at the end— (i) by striking “the amount of each such duty, tax, and fee” and all that follows through “99 percent of that duty, tax, or fee” and inserting “an amount calculated pursuant to regulations prescribed by the Secretary of the Treasury under subsection (l) shall be refunded as drawback”; and (ii) by striking the last sentence and inserting the following: “Notwithstanding subparagraph (A), drawback shall be allowed under this paragraph with respect to wine if the imported wine and the exported wine are of the same color and the price variation between the imported wine and the exported wine does not exceed 50 percent. Records. Transfers of merchandise may be evidenced by business records kept in the normal course of business and no additional certificates of transfer shall be required.”; (3) in paragraph (3)(B), by striking “the commercially interchangeable merchandise” and inserting “merchandise classifiable under the same 8-digit HTS subheading number as such imported merchandise”; and (4) by adding at the end the following: “(5) (A) For purposes of paragraph (2) and except as provided in subparagraph (B), merchandise may not be substituted for imported merchandise for drawback purposes based on the 8-digit HTS subheading number if the article description for the 8-digit HTS subheading number under which the imported merchandise is classified begins with the term ‘other’. “(B) In cases described in subparagraph (A), merchandise may be substituted for imported merchandise for drawback purposes if— “(i) the other merchandise and such imported merchandise are classifiable under the same 10-digit HTS statistical reporting number; and “(ii) the article description for that 10-digit HTS statistical reporting number does not begin with the term ‘other’. “(6) (A) For purposes of paragraph (2), a drawback claimant may use the first 8 digits of the 10-digit Schedule B number for merchandise or an article to determine if the merchandise or article is classifiable under the same 8-digit HTS subheading number as the imported merchandise, without regard to whether the Schedule B number corresponds to more than one 8-digit HTS subheading number. “(B) In this paragraph, the term ‘Schedule B’ means the Department of Commerce Schedule B, Statistical Classification of Domestic and Foreign Commodities Exported from the United States.” . (f) Liability for Drawback Claims.— Section 313(k) of the Tariff Act of 1930 (19 U.S.C. 1313(k)) is amended to read as follows: “(k) Liability for Drawback Claims.— “(1) In general.— Any person making a claim for drawback under this section shall be liable for the full amount of the drawback claimed. “(2) Liability of importers.— An importer shall be liable for any drawback claim made by another person with respect to merchandise imported by the importer in an amount equal to the lesser of— “(A) the amount of duties, taxes, and fees that the person claimed with respect to the imported merchandise; or “(B) the amount of duties, taxes, and fees that the importer authorized the other person to claim with respect to the imported merchandise. “(3) Joint and several liability.— Persons described in paragraphs (1) and (2) shall be jointly and severally liable for the amount described in paragraph (2).” . (g) Regulations.— Section 313(l) of the Tariff Act of 1930 (19 U.S.C. 1313(l)) is amended to read as follows: “(l) Regulations.— “(1) In general.— Allowance of the privileges provided for in this section shall be subject to compliance with such rules and regulations as the Secretary of the Treasury shall prescribe. “(2) Calculation of drawback.— “(A) In general.— Not later than the date that is 2 years after the date of the enactment of the Trade Facilitation and Trade Enforcement Act of 2015, the Secretary shall prescribe regulations for determining the calculation of amounts refunded as drawback under this section. “(B) Claims with respect to unused merchandise.— The regulations required by subparagraph (A) for determining the calculation of amounts refunded as drawback under this section shall provide for a refund of equal to 99 percent of the duties, taxes, and fees paid on the imported merchandise, which were imposed under Federal law upon entry or importation of the imported merchandise, and may require the claim to be based upon the average per unit duties, taxes, and fees as reported on the entry summary line item or, if not reported on the entry summary line item, as otherwise allocated by U.S. Customs and Border Protection, except that where there is substitution of the merchandise, then— “(i) in the case of an article that is exported, the amount of the refund shall be equal to 99 percent of the lesser of— “(I) the amount of duties, taxes, and fees paid with respect to the imported merchandise; or “(II) the amount of duties, taxes, and fees that would apply to the exported article if the exported article were imported; and “(ii) in the case of an article that is destroyed, the amount of the refund shall be an amount that is— “(I) equal to 99 percent of the lesser of— “(aa) the amount of duties, taxes, and fees paid with respect to the imported merchandise; and “(bb) the amount of duties, taxes, and fees that would apply to the destroyed article if the destroyed article were imported; and “(II) reduced by the value of materials recovered during destruction as provided in subsection (x). “(C) Claims with respect to manufactured articles into which imported or substitute merchandise is incorporated.— The regulations required by subparagraph (A) for determining the calculation of amounts refunded as drawback under this section shall provide for a refund of equal to 99 percent of the duties, taxes, and fees paid on the imported merchandise incorporated into an article that is exported or destroyed, which were imposed under Federal law upon entry or importation of the imported merchandise incorporated into an article that is exported or destroyed, and may require the claim to be based upon the average per unit duties, taxes, and fees as reported on the entry summary line item, or if not reported on the entry summary line item, as otherwise allocated by U.S. Customs and Border Protection, except that where there is substitution of the imported merchandise, then— “(i) in the case of an article that is exported, the amount of the refund shall be equal to 99 percent of the lesser of— “(I) the amount of duties, taxes, and fees paid with respect to the imported merchandise; or “(II) the amount of duties, taxes, and fees that would apply to the substituted merchandise if the substituted merchandise were imported; and “(ii) in the case of an article that is destroyed, the amount of the refund shall be an amount that is— “(I) equal to 99 percent of the lesser of— “(aa) the amount of duties, taxes, and fees paid with respect to the imported merchandise; and “(bb) the amount of duties, taxes, and fees that would apply to the substituted merchandise if the substituted merchandise were imported; and “(II) reduced by the value of materials recovered during destruction as provided in subsection (x). “(D) Exceptions.— The calculations set forth in subparagraphs (B) and (C) shall not apply to claims for wine based on subsection (j)(2) and claims based on subsection (p) and instead— “(i) for any drawback claim for wine based on subsection (j)(2), the amount of the refund shall be equal to 99 percent of the duties, taxes, and fees paid with respect to the imported merchandise, without regard to the limitations in subparagraphs (B)(i) and (B)(ii); and “(ii) for any drawback claim based on subsection (p), the amount of the refund shall be subject to the limitations set out in paragraph (4) of that subsection and without regard to subparagraph (B)(i), (B)(ii), (C)(i), or (C)(ii). “(3) Status reports on regulations.— Not later than the date that is one year after the date of the enactment of the Trade Facilitation and Trade Enforcement Act of 2015, and annually thereafter until the regulations required by paragraph (2) are final, the Secretary shall submit to Congress a report on the status of those regulations.” . (h) Substitution of Finished Petroleum Derivatives.— Section 313(p) of the Tariff Act of 1930 (19 U.S.C. 1313(p)) is amended— (1) by striking “Harmonized Tariff Schedule of the United States” each place it appears and inserting “HTS”; and (2) in paragraph (3)(A)— (A) in clause (ii)(III), by striking “, as so certified in a certificate of delivery or certificate of manufacture and delivery”; and (B) in the flush text at the end— (i) by striking “, so designated on the certificate of delivery or certificate of manufacture and delivery”; and (ii) by striking the last sentence and inserting the following: Records. “The party transferring the merchandise shall maintain records kept in the normal course of business to demonstrate the transfer.”. (i) Packaging Material.— Section 313(q) of the Tariff Act of 1930 (19 U.S.C. 1313(q)) is amended— (1) in paragraph (1), by striking “of 99 percent of any duty, tax, or fee imposed under Federal law on such imported material” and inserting “in an amount calculated pursuant to regulations prescribed by the Secretary of the Treasury under subsection (l)”; (2) in paragraph (2), by striking “of 99 percent of any duty, tax, or fee imposed under Federal law on the imported or substituted merchandise used to manufacture or produce such material” and inserting “in an amount calculated pursuant to regulations prescribed by the Secretary of the Treasury under subsection (l)”; and (3) in paragraph (3), by striking “they contain” each place it appears and inserting “it contains”. (j) Filing of Drawback Claims.— Section 313(r) of the Tariff Act of 1930 (19 U.S.C. 1313(r)) is amended— (1) in paragraph (1)— (A) by striking the first sentence and inserting the following: “A drawback entry shall be filed or applied for, as applicable, not later than 5 years after the date on which merchandise on which drawback is claimed was imported.”; (B) in the second sentence, by striking “3-year” and inserting “5-year”; and (C) in the third sentence, by striking “the Customs Service” and inserting “U.S. Customs and Border Protection”; (2) in paragraph (3)— (A) in subparagraph (A)— (i) in the matter preceding clause (i), by striking “The Customs Service” and inserting “U.S. Customs and Border Protection”; (ii) in clauses (i) and (ii), by striking “the Customs Service” each place it appears and inserting “U.S. Customs and Border Protection”; and (iii) in clause (ii)(I), by striking “3-year” and inserting “5-year”; and (B) in subparagraph (B), by striking “the periods of time for retaining records set forth in subsection (t) of this section and” and inserting “the period of time for retaining records set forth in”; and (3) by adding at the end the following: “(4) All drawback claims filed on and after the date that is 2 years after the date of the enactment of the Trade Facilitation and Trade Enforcement Act of 2015 shall be filed electronically.” . (k) Designation of Merchandise by Successor.— Section 313(s) of the Tariff Act of 1930 (19 U.S.C. 1313(s)) is amended— (1) in paragraph (2), by striking subparagraph (B) and inserting the following: “(B) subject to paragraphs (5) and (6) of subsection (j), imported merchandise, other merchandise classifiable under the same 8-digit HTS subheading number as such imported merchandise, or any combination of such imported merchandise and such other merchandise, that the predecessor received, before the date of succession, from the person who imported and paid any duties, taxes, and fees due on the imported merchandise;” ; and (2) in paragraph (4), by striking “certifies that” and all that follows and inserting “certifies that the transferred merchandise was not and will not be claimed by the predecessor.”. (l) Drawback Certificates.— Section 313 of the Tariff Act of 1930 (19 U.S.C. 1313) is amended by striking subsection (t). (m) Drawback for Recovered Materials.— Section 313(x) of the Tariff Act of 1930 (19 U.S.C. 1313(x)) is amended by striking “and (c)” and inserting “(c), and (j)”. (n) Definitions.— Section 313 of the Tariff Act of 1930 (19 U.S.C. 1313) is amended by adding at the end the following: “(z) Definitions.— In this section: “(1) Directly.— The term ‘directly’ means a transfer of merchandise or an article from one person to another person without any intermediate transfer. “(2) HTS.— The term ‘HTS’ means the Harmonized Tariff Schedule of the United States. “(3) Indirectly.— The term ‘indirectly’ means a transfer of merchandise or an article from one person to another person with one or more intermediate transfers.” . (o) Recordkeeping.— Section 508(c)(3) of the Tariff Act of 1930 (19 U.S.C. 1508(c)(3)) is amended by striking “payment” and inserting “liquidation”. (p) Government Accountability Office Report.— (1) In general.— Not later than one year after the issuance of the regulations required by subsection (l)(2) of section 313 of the Tariff Act of 1930, as added by subsection (g) of this section, the Comptroller General of the United States shall submit to the Committee on Finance of the Senate and the Committee on Ways and Means of the House of Representatives a report on the modernization of drawback and refunds under section 313 of the Tariff Act of 1930, as amended by this section. (2) Contents.— The report required by paragraph (1) shall include the following: (A) An assessment of the modernization of drawback and refunds under section 313 of the Tariff Act of 1930, as amended by this section. (B) A description of drawback claims that were permissible before the effective date provided for in subsection (q) that are not permissible after that effective date and an identification of industries most affected. (C) A description of drawback claims that were not permissible before the effective date provided for in subsection (q) that are permissible after that effective date and an identification of industries most affected. (q) Effective Date.— (1) In general.— The amendments made by this section shall— (A) take effect on the date of the enactment of this Act; and (B) except as provided in paragraph (3), apply to drawback claims filed on or after the date that is 2 years after such date of enactment. (2) Reporting of operability of automated commercial environment computer system.— Not later than one year after the date of the enactment of this Act, and not later than 2 years after such date of enactment, the Secretary of the Treasury shall submit to the Committee on Finance of the Senate and the Committee on Ways and Means of the House of Representatives a report on— (A) the date on which the Automated Commercial Environment will be ready to process drawback claims; and (B) the date on which the Automated Export System will be ready to accept proof of exportation under subsection (i) of section 313 of the Tariff Act of 1930, as amended by subsection (d) of this section. (3) Transition rule.— During the one-year period beginning on the date that is 2 years after the date of the enactment of this Act, a person may elect to file a claim for drawback under— (A) section 313 of the Tariff Act of 1930, as amended by this section; or (B) section 313 of the Tariff Act of 1930, as in effect on the day before the date of the enactment of this Act.

23. 2020

    United States-Mexico-Canada Agreement Implementation Act

    Pub. L. 116–113 § 206(a)(1) · 134 Stat. 11

    1. Added · 19 U.S.C. § 1508(b)

       Pub. L. 116–113, § 206(a)(1), added subsec. (b)

    2. Struck · 19 U.S.C. § 1508(b)

       Pub. L. 116–113, § 206(a)(1), struck out former subsec. (b) which related to exportations to NAFTA countries

    Source evidence

    Code amendment note
    Subsec. (b). Pub. L. 116–113, § 206(a)(1), added subsec. (b) and struck out former subsec. (b) which related to exportations to NAFTA countries.

    Enacted provision · exact public law section
    (1) by striking subsection (b) and inserting the following: “(b) Exports and Imports Relating to USMCA Countries.— “(1) Definitions.— In this subsection: “(A) USMCA; usmca country.— The terms ‘USMCA’ and ‘USMCA country’ have the meanings given those terms in section 3 of the United States-Mexico-Canada Agreement Implementation Act. “(B) USMCA certification of origin.— The term ‘USMCA certification of origin’ means the certification established under article 5.2.1 of the USMCA that a good qualifies as an originating good under the USMCA. “(2) Exports to usmca countries.— Any person who completes a USMCA certification of origin or provides a written representation for a good exported from the United States to a USMCA country shall make, keep, and, pursuant to rules and regulations prescribed by the Secretary of the Treasury, render for examination and inspection, all records and supporting documents related to the origin of the good (including the certification or copies thereof), including records related to— “(A) the purchase, cost, value, and shipping of, and payment for, the good; “(B) the purchase, cost, value, and shipping of, and payment for, all materials, including indirect materials, used in the production of the good; and “(C) the production of the good in the form in which it was exported or the production of the material in the form in which it was sold. “(3) Exports under the canadian agreement.— Any person who exports, or who knowingly causes to be exported, any merchandise to Canada during such time as the United States-Canada Free-Trade Agreement is in force with respect to, and the United States applies that Agreement to, Canada shall make, keep, and render for examination and inspection such records (including certifications of origin or copies thereof) which pertain to the exportations. “(4) Imports into the united states.— “(A) In general.— Any importer who claims preferential tariff treatment under the USMCA for a good imported into the United States from a USMCA country shall make, keep, and, pursuant to rules and regulations prescribed by the Secretary of the Treasury of the Secretary of Labor, render for examination and inspection— “(i) records and supporting documentation related to the importation; “(ii) all records and supporting documents related to the origin of the good (including the certification or copies thereof), if the importer completed the certification; and “(iii) records and supporting documents necessary to demonstrate that the good did not, while in transit to the United States, undergo further production or any other operation other than unloading, reloading, or any other operation necessary to preserve the good in good condition or to transport the good to the United States. “(B) Vehicle producer.— Any vehicle producer whose good is the subject of a claim for preferential tariff treatment under the USMCA shall make, keep, and, pursuant to rules and regulations promulgated by the Secretary of the Treasury and Secretary of Labor, render for examination and inspection records and supporting documents related to the labor value content and steel and aluminum purchasing requirements for the qualification of its vehicles for preferential treatment. “(5) Retention period.— “(A) Exports to usmca countries.— A person covered by paragraph (2) who completes a USMCA certification of origin or provides a written representation for a good exported from the United States to a USMCA country shall keep the records required by such paragraph relating to that certification of origin for a period of at least 5 years after the date on which the certification is completed. “(B) Exports under canadian agreement.— The records required by paragraph (3) shall be kept for such periods of time as the Secretary shall prescribe, except that— “(i) no period of time for the retention of the records may exceed 5 years from the date of entry, filing of a reconciliation, or exportation, as appropriate; and “(ii) records for any drawback claim shall be kept until the third anniversary of the date of liquidation of the claim. “(C) Imports into the united states.— “(i) In general.— An importer covered by paragraph (4)(A) shall keep the records and supporting documents required by such paragraph for a period of at least 5 years after the date of importation of the good. “(ii) Vehicle producer.— A vehicle producer covered by paragraph (4)(B) shall keep the records and supporting documents required by paragraph (4)(B) for a period of at least 5 years after the date of filing the certifications required under paragraphs (1) and (2) of section 202A(c) of the United States-Mexico-Canada Agreement Implementation Act.” ;

    Effective date note
    Amendment by Pub. L. 116–260 effective July 1, 2020, see section 601(h) of div. O of Pub. L. 116–260, set out as a note under section 81c of this title. Pub. L. 116–113, title II, § 206(b), Jan. 29, 2020, 134 Stat. 48, provided that: [For definition of “USMCA” as used in section 206(b) of Pub. L. 116–113, set out above, see section 4502 of this title.]

24. 2020

    United States-Mexico-Canada Agreement Implementation Act

    Pub. L. 116–113 § 206(a)(2) · 134 Stat. 11

    Struck · 19 U.S.C. § 1508(c)

    Pub. L. 116–113, § 206(a)(2), struck out subsec. (c) which related to period of time for keeping required records

    Target inherited from the preceding amendment note.

    Source evidence

    Code amendment note
    Pub. L. 116–113, § 206(a)(2), struck out subsec. (c) which related to period of time for keeping required records.

    Enacted provision · exact public law section
    (2) by striking subsection (c); and

    Effective date note
    Amendment by Pub. L. 116–260 effective July 1, 2020, see section 601(h) of div. O of Pub. L. 116–260, set out as a note under section 81c of this title. Pub. L. 116–113, title II, § 206(b), Jan. 29, 2020, 134 Stat. 48, provided that: [For definition of “USMCA” as used in section 206(b) of Pub. L. 116–113, set out above, see section 4502 of this title.]

25. 2020

    United States-Mexico-Canada Agreement Implementation Act

    Pub. L. 116–113 § 206(a)(3) · 134 Stat. 11

    Substituted · 19 U.S.C. § 1508(e)(1)

    Pub. L. 116–113, § 206(a)(3), substituted “USMCA” for “NAFTA” in heading

    Source evidence

    Code amendment note
    Subsec. (e)(1). Pub. L. 116–113, § 206(a)(3), substituted “USMCA” for “NAFTA” in heading.

    Enacted provision · exact public law section
    (3) in the paragraph heading for subsection (e)(1), by striking “nafta” and inserting “usmca”.

    Effective date note
    Amendment by Pub. L. 116–260 effective July 1, 2020, see section 601(h) of div. O of Pub. L. 116–260, set out as a note under section 81c of this title. Pub. L. 116–113, title II, § 206(b), Jan. 29, 2020, 134 Stat. 48, provided that: [For definition of “USMCA” as used in section 206(b) of Pub. L. 116–113, set out above, see section 4502 of this title.]

26. 2020

    Financial Services and General Government Appropriations Act, 2021

    Pub. L. 116–260 div. O title VI § 601(d)(1) · 134 Stat. 1182

    Added · 19 U.S.C. § 1508(c)

    Pub. L. 116–260 added subsec. (c)

    Source evidence

    Code amendment note
    Subsec. (c). Pub. L. 116–260 added subsec. (c).

    Enacted provision · exact public law section
    Sec. 601. (including rescission of funds) None of the funds in this Act shall be used for the planning or execution of any program to pay the expenses of, or otherwise compensate, non-Federal parties intervening in regulatory or adjudicatory proceedings funded in this Act.

    Effective date note
    Amendment by Pub. L. 116–260 effective July 1, 2020, see section 601(h) of div. O of Pub. L. 116–260, set out as a note under section 81c of this title. Pub. L. 116–113, title II, § 206(b), Jan. 29, 2020, 134 Stat. 48, provided that: [For definition of “USMCA” as used in section 206(b) of Pub. L. 116–113, set out above, see section 4502 of this title.]

35 of 39 references resolved to an enrolled provision · 4 partial