HQ 114834 - 19 CFR 141.92; Waiver of invoice requirement - United States International Trade Commision Rulings

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HQ 114834

December 20, 1999

ENT-1-RR:IT:EC 114834 GOB

CATEGORY: ENTRY

David E. Cohen, Esq.
Ronald W. Gerdes, Esq.
Sandler, Travis & Rosenberg, P.A.
1300 Pennsylvania Avenue, N.W.
Washington, D.C. 20004-3002

RE: 19 CFR 141.92; Waiver of invoice requirement

Dear Messrs. Cohen and Gerdes:

This is in response to your ruling request of October 12, 1999.

Pursuant to 19 CFR 177.2(b)(7), you have requested confidentiality with respect to certain of the information in your request, including the names of certain entities. We have decided to grant your request for confidentiality.

You have stated in your request that you intend to request a valuation ruling pertinent to the transactions described herein. You state that your client “believes the sale between the vendor and [ ] to be the proper sale upon which appraisement should be based and [ ] will seek a separate binding ruling to this effect consistent with Nissho Iwai American Corp. v. U.S., 982 F.2d 505 (Fed. Cir. 1992).”

We wish to emphasize that this ruling is not a Customs valuation ruling. Further, this ruling contains no determinations with respect to valuation, nor is anything in this ruling meant to create any inferences or suggestions with respect to any future valuation ruling that may be requested and issued.

In one of your submissions you state: “Should the appraisement issues not be resolved during the course of the normal liquidation cycle, [ ] requests that liquidation of the entries be withheld pending that resolution.” This ruling does not address this request which, similar to any valuation issue, is not within the scope of the responding branch.

FACTS:

In the subject ruling request, you seek a waiver of invoice requirements under 19 CFR 141.92(a). You state:

In this ruling request, [ ] asks that the Customs Service allow the importing [ ] affiliate to enter goods purchased pursuant to this system upon presentation of the invoice issued by the foreign vendor to [ ] and waive the requirement that entry documentation also include an invoice issued by [ ] to the [ ] affiliate. Waiver of the invoice requirement for the sale between [ ] and the [ ] affiliate is consistent with 19 U.S.C. 1481(d) and 19 CFR 141.92. ...
When a particular [ ] affiliate makes entry of merchandise purchased through [ ], the [ ] affiliate intends to present to the Customs Service, either with the entry or when requested, a hardcopy of the commercial invoice from the foreign vendor to [ ]. It is this sale that [ ] believes to be the proper sale upon which appraisement should be based and [ ] intends to seek a binding ruling request to this effect at a later date. The importing entity will notify the appropriate Customs office of the new structure of these transactions. If information on the second sale is requested, [ ] intends to submit the foreign vendor’s invoice to [ ] with an attachment detailing a simple algorithm which will serve as the pro forma invoice of the transaction between [ ] and the importing [ ] affiliate. The attachment will state the [ ] markup percentage from the vendor’s invoice and explain that the buyer on the vendor’s invoice should be switched to the seller and the “ship to” address will become the buyer. The ship to address will remain the same.

The regulations provide that a waiver of the invoice requirements may be granted when the ... [port director] is satisfied that “[t]he examination of the merchandise, final determination of duties, and collection of statistics can be effected [properly] without the production of the required invoice.” 19 C.F.R. 141.92(a)(2). The information contained on the vendor invoice from the foreign vendor to [ ] combined with the document containing the algorithm will afford the Customs Service the information it needs to verify compliance with all of the requirements set forth in 19 C.F.R. 141.92(a)(2) by the importing [ ] affiliate.

Furthermore, the information contained in the documents that will be submitted to the Customs Service will satisfy the requirements of 19 C.F.R. 141.92(b). First, the importing [ ] affiliate will make the invoice available from the foreign seller of the merchandise. Second, the importing [ ] affiliate will provide Customs with a statement detailing the algorithm to be applied to the vendor invoice to arrive at the proper appraised value. The invoice provided will be a commercial invoice containing all information as provided for in 19 C.F.R. 141.86. Third, the vendor invoice with the statement detailing the algorithm to be applied to the vendor invoice is effectively a pro forma invoice as provided for in 19 C.F.R. 141.85. Fourth, all information the port director requires for appraisement, classification, and statistical purposes will be provided on the vendor invoice together with the statement detailing the algorithm.

ISSUE:

Whether, pursuant to 19 CFR 141.92(a), Customs can waive production of the required invoice.

LAW AND ANALYSIS:

19 CFR 141.92(a) and (b) provide:

§141.92 Waiver of invoice requirements.

(a) When waiver may be granted. The port director may waive production of a required invoice when he is satisfied that either :

(1) The importer cannot by reason of conditions beyond his control furnish a complete and accurate invoice; or

(2) The examination of merchandise, final determination of duties, and collection of statistics can be effected properly without the production of the required invoice.

(b) Documents to be filed by importer. As a condition to the granting of a waiver, the importer shall file the following documents with the entry:

(1) Any invoice or invoices received from the seller or shipper;

(2) A statement pointing out in exact detail any inaccuracies, omissions, or other defects in such invoice or invoices;

(3) An executed pro forma invoice in accordance with §141.85; and

(4) Any other information required by the port director for either appraisement or classification of the merchandise, or for statistical purposes.

After a consideration of your request, we have decided to grant a waiver of production of the required invoice as specified in 19 CFR 141.92(a). The basis for the grant of this waiver is 19 CFR 141.92(a)(2), i.e., we believe that the examination of merchandise, final determination of duties, and collection of statistics can be effected properly without the production of the required invoice.

As provided for in 19 CFR 141.92(b), the waiver is conditioned upon the filing of all documents described in 19 CFR 141.92(b).

The waiver is also conditioned upon the submission of all information and documentation required by law and regulation for the entry of merchandise (other than the invoice waived by this ruling).

The submission of the “algorithm,” as you describe in your request (see the FACTS section of this ruling), is not a substitute for information which is required by law or regulation to be submitted (other than the invoice which is waived by this ruling).

In this regard, we note that 19 U.S.C. 1484(a)(1)(B) provides that:

... one of the parties qualifying as “importer of record” ... shall, using reasonable care- ...
(B) complete the entry by filing with the Customs Service the declared value, classification and rate of duty applicable to the merchandise, and such other documentation or, pursuant to an electronic data interchange system, such other information as is necessary to enable the Customs Service to-

(i) properly assess duties on the merchandise,

(ii) collect accurate statistics with respect to the merchandise, and

(iii) determine whether any other applicable requirement of law (other than a requirement relating to release from customs custody) is met.

In its appraisement function, Customs reserves the right, as always, to review all supporting documentation and information.

As stated above, this ruling is not a valuation ruling, nor does it make any valuation determinations.

In addition, this ruling does not constitute a waiver of any recordkeeping requirement under 19 U.S.C. 1508 and 1509 and 19 CFR Part 163.

You are advised to furnish a copy of this ruling to the director of each port where your client imports merchandise.

HOLDING:

Pursuant to 19 CFR 141.92(a), Customs hereby waives the production of the invoice under the factual situation presented herein.

Sincerely,

Jerry Laderberg
Chief,

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