§ 3722. — Protections against transshipment.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 19USC3722]
TITLE 19--CUSTOMS DUTIES
CHAPTER 23--EXTENSION OF CERTAIN TRADE BENEFITS TO SUB-SAHARAN AFRICA
SUBCHAPTER II--TRADE BENEFITS
Sec. 3722. Protections against transshipment
(a) Preferential treatment conditioned on enforcement measures
(1) In general
The preferential treatment under section 3721(a) of this title
shall not be provided to textile and apparel articles that are
imported from a beneficiary sub-Saharan African country unless that
country--
(A) has adopted an effective visa system, domestic laws, and
enforcement procedures applicable to covered articles to prevent
unlawful transshipment of the articles and the use of
counterfeit documents relating to the importation of the
articles into the United States;
(B) has enacted legislation or promulgated regulations that
would permit United States Customs Service verification teams to
have the access necessary to investigate thoroughly allegations
of transshipment through such country;
(C) agrees to report, on a timely basis, at the request of
the United States Customs Service, on the total exports from and
imports into that country of covered articles, consistent with
the manner in which the records are kept by that country;
(D) will cooperate fully with the United States to address
and take action necessary to prevent circumvention as provided
in Article 5 of the Agreement on Textiles and Clothing;
(E) agrees to require all producers and exporters of covered
articles in that country to maintain complete records of the
production and the export of covered articles, including
materials used in the production, for at least 2 years after the
production or export (as the case may be); and
(F) agrees to report, on a timely basis, at the request of
the United States Customs Service, documentation establishing
the country of origin of covered articles as used by that
country in implementing an effective visa system.
(2) Country of origin documentation
For purposes of paragraph (1)(F), documentation regarding the
country of origin of the covered articles includes documentation
such as production records, information relating to the place of
production, the number and identification of the types of machinery
used in production, the number of workers employed in production,
and certification from both the manufacturer and the exporter.
(b) Customs procedures and enforcement
(1) In general
(A) Regulations
Any importer that claims preferential treatment under
section 3721 of this title shall comply with customs procedures
similar in all material respects to the requirements of Article
502(1) of the NAFTA as implemented pursuant to United States
law, in accordance with regulations promulgated by the Secretary
of the Treasury.
(B) Determination
(i) In general
In order to qualify for the preferential treatment under
section 3721 of this title and for a Certificate of Origin
to be valid with respect to any article for which such
treatment is claimed, there shall be in effect a
determination by the President that each country described
in clause (ii)--
(I) has implemented and follows; or
(II) is making substantial progress toward
implementing and following,
procedures and requirements similar in all material respects
to the relevant procedures and requirements under chapter 5
of the NAFTA.
(ii) Country described
A country is described in this clause if it is a
beneficiary sub-Saharan African country--
(I) from which the article is exported; or
(II) in which materials used in the production of
the article originate or in which the article or such
materials, undergo production that contributes to a
claim that the article is eligible for preferential
treatment.
(2) Certificate of Origin
The Certificate of Origin that otherwise would be required
pursuant to the provisions of paragraph (1) shall not be required in
the case of an article imported under section 3721 of this title if
such Certificate of Origin would not be required under Article 503
of the NAFTA (as implemented pursuant to United States law), if the
article were imported from Mexico.
(3) Penalties for exporters
If the President determines, based on sufficient evidence, that
an exporter has engaged in transshipment as defined in paragraph
(4), then the President shall deny for a period of 5 years all
benefits under section 3721 of this title to such exporter, any
successor of such exporter, and any other entity owned or operated
by the principal of the exporter.
(4) Transshipment described
Transshipment within the meaning of this subsection has occurred
when preferential treatment for a textile or apparel article under
this chapter \1\ has been claimed on the basis of material false
information concerning the country of origin, manufacture,
processing, or assembly of the article or any of its components. For
purposes of this paragraph, false information is material if
disclosure of the true information would mean or would have meant
that the article is or was ineligible for preferential treatment
under section 3721 of this title.
---------------------------------------------------------------------------
\1\ See References in Text note below.
---------------------------------------------------------------------------
(5) Monitoring and reports to Congress
The Customs Service shall monitor and the Commissioner of
Customs shall submit to Congress, not later than March 31 of each
year, a report on the effectiveness of the visa systems and the
implementation of legislation and regulations described in
subsection (a) of this section and on measures taken by countries in
sub-Saharan Africa which export textiles or apparel to the United
States to prevent circumvention as described in Article 5 of the
Agreement on Textiles and Clothing.
(c) Customs Service enforcement
The Customs Service shall--
(1) make available technical assistance to the beneficiary sub-
Saharan African countries--
(A) in the development and implementation of visa systems,
legislation, and regulations described in subsection (a)(1)(A)
of this section; and
(B) to train their officials in anti-transshipment
enforcement;
(2) send production verification teams to at least four
beneficiary sub-Saharan African countries each year; and
(3) to the extent feasible, place beneficiary sub-Saharan
African countries on the Electronic Visa (ELVIS) program.
(d) Authorization of appropriations
There is authorized to be appropriated to carry out subsection (c)
of this section the sum of $5,894,913.
(Pub. L. 106-200, title I, Sec. 113, May 18, 2000, 114 Stat. 263.)
References in Text
This chapter, referred to in subsec. (b)(4), was in the original
``this Act'', and was translated as reading ``this title'', meaning
title I of Pub. L. 106-200, May 18, 2000, 114 Stat. 252, which is
classified principally to this chapter, to reflect the probable intent
of Congress. For complete classification of title I to the Code, see
Short Title note set out under section 3701 of this title and Tables.
Transfer of Functions
For transfer of functions, personnel, assets, and liabilities of the
United States Customs Service of the Department of the Treasury,
including functions of the Secretary of the Treasury relating thereto,
to the Secretary of Homeland Security, and for treatment of related
references, see sections 203(1), 551(d), 552(d), and 557 of Title 6,
Domestic Security, and the Department of Homeland Security
Reorganization Plan of November 25, 2002, as modified, set out as a note
under section 542 of Title 6.
Delegation of Authority
Authority of President under subsec. (b)(3) of this section
delegated to the Committee for the Implementation of Textile Agreements
by section 4 of Ex. Ord. No. 13191, Jan. 17, 2001, 66 F.R. 7271, set out
as a note under section 2703 of this title.
Proc. No. 7350. To Implement the African Growth and Opportunity Act and
To Designate Eritrea as a Beneficiary Developing Country for Purposes of
the Generalized System of Preferences
Proc. No. 7350, Oct. 2, 2000, 65 F.R. 59321, provided in par. (4)
that the United States Trade Representative is authorized to determine
whether each designated beneficiary sub-Saharan African country has
satisfied the requirements of section 3722(a) of this title, relating to
the establishment of procedures to protect against unlawful
transshipments and section 3722(b)(1)(B) of this title relating to the
implementation of procedures and requirements similar in all material
respects to the relevant procedures and requirements under chapter 5 of
the North American Free Trade Agreement (NAFTA), is directed to set
forth the determination in a notice to be published in the Federal
Register which notice shall modify the Harmonized Tariff Schedule of the
United States (HTS) by listing the countries that satisfy the
requirements of sections 3722(a) and 3722(b)(1)(B) of this title, and is
authorized to exercise the authority provided to the President under
section 2483 of this title to embody modifications and technical or
conforming changes in the HTS.
Section Referred to in Other Sections
This section is referred to in section 3721 of this title.
