HQ 116099 - United Tobacco Co.; warehouse; 19 CFR 144.34 and 144.41 - United States International Trade Commision Rulings

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HQ 116099

February 19, 2004

CATEGORY: ENTRY

ENT-3-RR:IT:EC 116099 CK

George M. Keller
Customs Advisory Services, Inc.
1003 Virginia Ave.
Suite 200
Atlanta, GA 30354

RE: United Tobacco Co.; warehouse; 19 CFR 144.34 and 144.41

Dear Mr. Keller:

This is in response to your ruling request dated December 9, 2003, on behalf of your client, United Tobacco Co., LLC, as to whether tobacco that is currently held in a bonded warehouse can be sent to another bonded warehouse for re-warehousing.

FACTS:

Burley Tobacco, originally grown in Argentina, was shipped unprocessed to Brazil in 2002. The tobacco was processed in Brazil before it was exported to the United States on October 9, 2002. The tobacco was imported by United Tobacco Co., LLC into Savannah, Georgia on November 4, 2002 and moved via in-bond number xxxxxx801 from foreign trade zone 104 in Savannah to a bonded warehouse, Brook Cove warehouse, in Winston-Salem, North Carolina. An attached CF 7512 details the above-described movement, and quantity of tobacco from Savannah to the bonded warehouse in Winston-Salem.

Also attached to the ruling request is the CF 7501 showing 552 cartons of un-manufactured tobacco were moved in-bond from Savannah to be entered April 9, 2003 into the RJR Brook Cove bonded warehouse. The CF 7501 lists the type of entry as a “21” entry, which is a warehouse entry. A CF 3461 for entry number xxx-xxxx811-0 was also attached. That form shows 552 cartons of burley tobacco were delivered to RJR Brook Cove warehouse for warehouse entry on April 9, 2003.

According to the ruling requester, the tobacco remains to this date in the RJR Brook Cove bonded warehouse in Winston-Salem, North Carolina.

ISSUE:

Whether the burley tobacco that is in a bonded warehouse can be re-warehoused in another bonded warehouse.

LAW AND ANALYSIS:

Two regulations in issue are Customs Regulations 144.34 and 144.41 (19 CFR 144.34 and 144.41). Section 144.34(a) provides for transferring merchandise from one bonded warehouse to another at the same port, under the supervision of the port director. The port director may require the filing of a rewarehouse entry if determined necessary for proper control of the merchandise. Section 144.34(b) provides for the withdrawal of merchandise from a warehouse at one port, transportation and entry for rewarehouse at a different port. Section 144.41 provides for more direct control of the rewarehousing of merchandise if the loss of control is a factor in the movement of the merchandise.

§144.34 Transfer to another warehouse.

(a) At the same port. With the concurrence of the proprietors of the delivering and receiving warehouses, merchandise may be transferred from one bonded warehouse to another at the same port under Customs supervision and at the expense of the importer upon his written request to the port director, who shall issue an order for such transfer on Customs Form 6043. However, the port director may require the filing of a rewarehouse entry under §144.41 if he determines it necessary for proper control of the merchandise. All charges shall be paid before merchandise is transferred from a warehouse of class 1 (see §19.1 of this chapter for classes of warehouses). The quantities of goods so transferred shall be subject to the joint determination of the warehouse proprietor and the cartman, lighterman, or private bonded carrier, as provided in §19.6 of this chapter. (b) At another port. Merchandise may be transferred to a warehouse which is under the jurisdiction of another port by withdrawing the merchandise for transportation in accordance with §144.36 and entering it for rewarehouse in accordance with §144.41 upon arrival at destination. All charges shall be paid before merchandise is transferred from the warehouse of class 1 (see §19.1 of this chapter for classes of warehouses).

§144.41 Entry for rewarehouse.

(a) Applicability. When merchandise which has been withdrawn from warehouse for transportation to another port has arrived at the port of destination, it may be entered for rewarehouse by the consignee named in the withdrawal. (b) Form of entry. An entry for rewarehouse shall be made in duplicate on Customs Form 7501 and shall contain all of the statistical information as provided in §141.61(e) of this chapter. The port director may require an extra copy or copies of Customs Form 7501, annotated “PERMIT,” for use in connection with the delivery of the merchandise to the warehouse. No declaration is required on the entry. (c) Combining separate shipments. (1) Separate shipments consigned to the same consignee and received under separate withdrawals for transportation may be combined into one rewarehouse entry if the warehouse withdrawals are from the same original warehouse entry. (2) Shipments covered by multiple warehouse entries, and shipped from a single warehouse under separate withdrawals for transportation, via a single conveyance, may be combined into one rewarehouse entry if consigned to the same consignee and deposited into a single warehouse. With the exception of alcohol and tobacco products, this procedure shall not be allowed for merchandise which is in any way restricted (for example, quota/visa). The combined rewarehouse entry shall have attached either copies of each warehouse entry package which is being combined into the single rewarehouse entry or a summary with pertinent information, that is, the date of importation, commodity description, size, HTSUS and entry numbers, for all entries withdrawn for consolidation as one rewarehouse entry. Any combining of separate withdrawals into one rewarehouse entry shall result in the rewarehouse entry being assigned the import date of the oldest entry being combined into the rewarehouse entry. (3) Combining of separate shipments shall be prohibited in all other circumstances. (d) Bond. A bond on Customs Form 301, containing the bond conditions set forth in §113.62 of this chapter shall be filed before a permit is issued on Customs Form 7501 for sending the merchandise to the bonded warehouse. However, no bond shall be required if the merchandise is entered by the consignee named in the original bond filed at the original port of entry, or if it is entered by a transferee who has established his right to withdraw the merchandise and has filed a bond in accordance with subpart C of this part. (e) Value and classification. The duties determined at the port where the original warehouse entry was filed shall be the duties chargeable under the rewarehouse entry, except in the cases provided for in §§159.7 (a) and (b) of this chapter, which pertain to certain classes of merchandise excluded from the liquidation of the original warehouse entry and merchandise on which rates of duty or tax are changed by an act of Congress or by a proclamation by the President. (f) Examination. Any examination necessary for identification of the merchandise, determination of shortages, or other purposes shall be made. (g) Failure to enter. If the rewarehouse entry is not filed within 15 calendar days after its arrival, the merchandise shall be disposed of in accordance with the applicable procedures in § 4.37 or § 122.50 or § 123.10 of this chapter. However, merchandise sent to a general order warehouse shall not be sold or otherwise disposed of as unclaimed until the expiration of the original 5-year period during which the merchandise may remain in warehouse under bond. (h) Protest. A protest may be filed at the port where the rewarehouse entry is made against a liquidation made at that port under §159.7 (a) or (b) of this chapter, or against a refusal of the port director of that port to liquidate pursuant to said sections. In all other cases, any protest shall be filed against the original warehouse entry.

In the present situation, according to United Tobacco, and the documents presented, the burley tobacco was put into the RJR Brook Cove warehouse, having been moved in-bond from the foreign trade zone in Savannah, GA for warehouse entry. The burley tobacco, according to United Tobacco, remains at this time in the same bonded warehouse. The record is devoid of any documents disproving the tobacco is in the original bonded warehouse. Also, according to United Tobacco, and in direct contradiction to the National Import Specialist’s claim, a consumption entry was never made on the tobacco. Additionally, the CF 7501 accompanying this file, lists a type “21” entry for the tobacco, which is a warehouse entry. There is no evidence that any “01” entry, consumption entry, was ever made. Therefore, the tobacco has been, and is currently, in a bonded warehouse, and no consumption entry has been made. Therefore, there is no reason that United Tobacco cannot make an application under 19 CFR 144.34 to transfer the tobacco between warehouses; or if required by the port, make a rewarehouse entry pursuant to 19 CFR 144.41.

HOLDING:

The tobacco at issue has been, and is currently, in a bonded warehouse, and no consumption entry has ever been made; therefore, an application to transfer the tobacco between warehouses can be made either pursuant to 19 CFR 144.34, or a rewarehouse entry can be made under 19 CFR 144.41, at the discretion of the port.

Sincerely,

Glen E. Vereb

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