United States International Trade Commision Rulings And Harmonized Tariff Schedule
faqs.org  Rulings By Number  Rulings By Category  Tariff Numbers
faqs.org > Rulings and Tariffs Home > Rulings By Number > 1994 HQ Rulings > HQ 0113259 - HQ 0224078 > HQ 0222843

Previous Ruling Next Ruling


HQ 222843


December 10, 1990

BON-1-04-CO:R:C:E 222843 CB

CATEGORY: ENTRY

Mr. Stephen J. McDermott
Customs Administrator
General Motors Corporation
3044 West Grand Boulevard
Detroit, Michigan 48202

RE: Temporary Importation Entry 813-0304489-5 District Case 90-3801-23491

Dear Mr. McDermott:

This responds to your letter of November 21, 1990, concerning a request for extension of the above referenced temporary importation bond.

The facts appear to be that on February 21, 1989, two vehicles were imported by the Delco Moraine Division of General Motors Corporation under Temporary Importation Bond (TIB) entry no. 813-0304489-5. The merchandise was entered duty-free under subheading 9813.00.05, of the Harmonized Tariff Schedule of the United States Annotated (HTSUSA). On July 17, 1990, the Customs Service issued a Notice of Penalty or Liquidated Damages Incurred and Demand for Payment (CF 5955A) for failure to export within the bond period or obtain an extension thereof. You filed a formal petition for extension of the TIB by letter dated August 10, 1990. In your letter you included a copy of a letter dated May 16, 1990, to the District Director of Customs, explaining that your Customshouse broker failed to notify you that the TIB was due to expire and therefore you were unable to file a timely application for extension of the TIB.

You also pointed out, in the August 10th letter, that the CF 5955A was addressed to the wrong Customshouse broker and therefore you were not aware that proceedings for demand of payment had begun. On September 18, 1990, you were notified by the Customs Service, that your letter had been reviewed and that your petitioning period had expired. On October 18, 1990, you filed a supplemental petition in the form of a letter. In said letter you informed the District Director that General Motors had received a copy of a CF 5955A issued on July 17, 1990 to the National Fire Insurance c/o A. Shea & Company, and at that time you began to research the issuance of the liquidated damages claim. On October 31, 1990 you were advised that your supplemental petition for relief from liquidated damages had been forwarded to the Regional Commissioner and that your untimely request for extension of the TIB should be addressed to Customs Headquarters.

Subheading 9813.00.05, HTSUSA, provides for the free importation, under bond, of "articles to be repaired, altered, or processed (including processes which result in articles manufactured or produced in the United States)." Under U.S. Note 1 of Subchapter XIII, HTSUSA, articles described in this tariff provision, when not imported for sale or sale on approval, may be admitted into the United States without the payment of duty, under bond for their exportation within 1 year from the date of importation. The U.S. Note provides that the 1 year period for exportation may be extended for one or more further periods which, when added to the initial period, do not exceed a total of 3 years.

Section 10.37 of the Customs Regulations provides that extensions of time for exportation of merchandise imported under a TIB may be granted by the appropriate district director upon written application on Customs Form 3173. Under section 10.37, untimely requests for an extension of time for exportation are to be referred to Customs Headquarters. Generally, extensions based upon untimely requests are only granted under extraordinary circumstances. Such extensions have been granted only when: (1) the articles covered by the entry remain in the country; (2) there is no evidence of use of the articles contrary to the terms of the bond; (3) the applicant is not a chronic violator; (4) there is no evidence of a lack of due diligence in complying with the law and regulations; and (5) there is a reasonable explanation of why the application was not timely filed.

In this case, according to the information you have provided, the first attempt to have the TIB extended was made on May 16, 1990, almost three months after expiration of the time for exportation (i.e., February 21, 1990, one year after the date of importation). This attempt did not comply with the Customs Regulations, as it was not in writing on a CF 3173. Only after receiving a notice of liquidated damages did you file the proper request.

The explanation given for the untimely filing of the application for extension of the TIB in this case is that your broker, at the time F.X. Coughlin, did not notify you of the expiration until May 8, 1990. You stated that the fact that F.X. Coughlin had been released as GM's broker effective April 1, 1990, may have had some bearing on the "oversight". We do not find this explanation to be a reasonable explanation of why the application was not timely filed. The TIB expired on February 21, 1990, while F.X. Coughlin was still GM's broker. "Oversight", without more explanation, leads us to conclude that there was a lack of due diligence in complying with the law and regulations and the request for extension of the bond period is denied.

Additionally, you have questioned the validity of the issuance of the CF 5955A because it was forwarded to a broker who was not acting as your agent in this particular entry transaction. Upon further investigation, we were advised by the District Office that a CF 5106 (Notification of Importer's Number, or Application for Importer's Number, or Notice of Change of Name or Address) was never submitted to the Customs Service by your company. Therefore, the computer generated CF 5955A was sent to the broker who was still listed in the system as your agent. In any event, it is our understanding that the petition for relief from liquidated damages is pending before the Regional Commissioner.

A copy of this letter is being sent to the District Director of Customs in Detroit.

Sincerely,

William G. Rosoff, Chief

Previous Ruling Next Ruling

See also: