DRA-1-06-DRA-2-02-RR:IT:EC 226929 IOR
Director, Passenger/Outbound Compliance
U.S. Customs Service
2323 South Shepard, Ste. 1211
Houston, TX 77019
RE: Internal Advice Request; unsigned bills of lading; drawback;
documentation of exportation; 19 CFR 191.52(c)(2); C.S.D.
82-59; C.S.D. 79-254; C.S.D. 80-99; T.D. 83-212
Dear Sir or Madame:
This request for internal advice was initiated by a letter
dated April 8, 1996 from Gulf Coast Drawback Services, Inc.
("GCDS"), on behalf of Constar International, Inc. ("Constar"),
which you forwarded by your memorandum dated April 25, 1996.
GCDS has requested that the copies of ocean bills of lading,
submitted on August 30, 1996, be granted confidentiality under
Customs Regulations, 177.2(b)(7) (19 CFR 177.2(b)(7). We have
reviewed the request for confidentiality and grant the request.
FACTS:
Constar files drawback claims pursuant to a contract
approved under 19 U.S.C. 1313(b), T.D. 96-26-F (HQ 226406).
Constar has routinely filed drawback claims utilizing unsigned
vessel or airway bills of lading to support an Uncertified Notice
of Exportation. Such claims have been approved in the past by
Customs. Constar is currently under audit by the Regulatory
Audit Division, and the use of unsigned bills of lading are being
challenged as valid proof of export. GCDS states that the
validity of the bills of lading is challenged on the basis that
the "stamped-in" or "type-in" date shown on the bills of lading
could have been done by any interim party. GCDS has submitted
two ocean bills of lading, each with an accompanying Notice of
Exportation of Articles With Benefit of Drawback (CF 7511).
Neither 7511 includes a date of exportation, or is signed by
anyone. There is a typewritten date on each bill of lading on
the bottom of the form next to the word "DATE:" on one and
"DATED" on the other. One of the bills of lading includes a
statement of "clean on board" followed by a date, and a
typewritten name of an individual on the signature line for the
carrier. The second bill of lading has nothing on the signature
line and although it includes a date, it does not have an "on
board" date. Both bills of lading include a bill of lading
number.
GCDS has also submitted four letters from persons who GCDS
states are licensed freight forwarders and international
carriers, however, it is difficult to determine from the letters
which one is from a freight forwarder and which one is from an
international carrier. Two of the four letters are unsigned.
According to the four letters, the freight forwarder prepares a
master bill of lading which is submitted to the steamship line.
The steamship line or steamship agent then uses the master bill
of lading to create a bill of lading for the specific
merchandise, and assigns a bill of lading number, affixes (some
by stamping or printing) an "on board date" and runs the
information off onto the specified carrier's bill of lading form,
by either computer or photocopying. The letters all indicate
that only the three "original" bills of lading are signed, and
these become negotiable instruments. One of the letters states
that a steamship company does not issue or sign a bill of lading
until it is certain that the cargo covered by the bill of lading
has in fact sailed on the exporting vessel. Three of the letters
indicate that the "original" bills of lading are either returned
to the freight forwarder or exporter. According to one letter
the "original" bills of lading may also be delivered with the
vessel to the port of discharge, or may not even be issued, if
"express" bills of lading are issued. All four of the letters
state that unsigned non-negotiable copies of the bill of lading
are returned to the shipper or forwarder. According to the
letters all three of the original bill of lading are required by
a bank for credit purposes, and in some cases three non-negotiable copies as well.
ISSUE:
Whether the submitted bills of lading satisfy the regulatory
requirements for proof of exportation for purposes of claiming
drawback.
LAW AND ANALYSIS:
The available procedures for establishment of exportation of
articles for drawback purposes are set forth in 19 CFR 191.51(a)
through (e). One of the procedures is (a) "Notice of
exportation," the requirements of which are set forth in 19 CFR
191.52.
Under 19 CFR 191.52(c), two types of documentation are
accepted for compliance with the notice of exportation procedure.
Constar has chosen to use the "uncertified notice of
exportation," under 191.52(c)(2), which consists of an
uncertified notice of exportation supported by "documentary
evidence of exportation, such as the bill of lading, air waybill,
freight waybill, Canadian Customs manifest, cargo manifest, or
certified copies thereof, issued by the exporting carrier."
(Emphasis added). The supporting documentary evidence must
establish fully the time and fact of exportation and the identity
of the exporter. 19 CFR 191.52(c)(2).
In this case, the documents provided are neither the
originals nor certified copies. From the statements submitted by
the freight forwarders and international carriers, it is apparent
that the original bill of lading cannot customarily be saved to
provide to Customs, as it is a document of title, and all
originals may be required for completing commercial transactions.
This is supported by U.C.C., Article 7, 7-104, which provides
that a bill of lading is a negotiable document of title.
According to Incoterms, 1990, "it is customary to issue bills of
lading in several originals but it is, of course, of vital
importance for a buyer or a bank acting upon his instructions in
paying the seller to ensure that all originals are surrendered by
the seller (so-called full set')." Id. at 15.
If a drawback claimant chooses to support an uncertified
notice of exportation with a bill of lading, and cannot provide
Customs with the original, the claimant must provide Customs with
a certified copy. With respect to certification, in C.S.D. 79-254, Customs stated that in support of an uncertified notice of
exportation, company invoices are not acceptable to prove
exportation, however, "[o]ther documents such as inland bills of
lading certified by the carrier, customs officer, or another
disinterested third party having knowledge of the exportation,
are acceptable." "Certified copy" is defined as a "copy
certified as true by the officer to whose custody the original is
entrusted." Ballentine's Law Dictionary, 1969, at 188. Based on
the definition and C.S.D. 79-254, certification by the carrier or
freight forwarder to whom the originals have been given, would be
acceptable certification, as these are disinterested third
parties who are entrusted with the original bills of lading for a
period during the transaction.
Customs stated in C.S.D. 80-99, that perforated and other
facsimile signatures on bills of lading and other documents used
to support an uncertified notice of exportation are "sufficient
for certification or authentication if the person or entity
affixing that signature intends to be bound by it." In C.S.D.
82-59, Customs stated that a bill of lading "in the possession of
the exporter, showing receipt of the goods by the export shipper,
would be a bill of lading issued' by that shipper" within the
meaning of section 22.7(c) of the Customs Regulations (now
section 191.52(c)(2) of the Customs regulations). With respect
to the term "issued", the C.S.D. stated that "issued" does not
mean "signed,", "certified," or "authenticated," but means
"emitted or sent forth." In C.S.D. 82-59, Customs also
reaffirmed the decision in C.S.D. 80-99, stating that perforated
and other facsimile signatures on supporting documents suffice.
Nothing in C.S.D. 82-59 states that supporting documents "issued"
by the exporting carrier, do not need to be signed or certified
copies.
GCDS has cited T.D. 83-212 in support of the argument that
"since certified copies are acceptable proof of exportation, and
in view of the clear language in the Treasury Decision...of what
constitutes a certified copy," whether an ocean bill of lading is
signed or unsigned is a moot point. T.D. 83-212 published
Customs analysis of comments pertaining to proposed revision of
drawback regulations. The comment and response referred to by
GCDS was in reference to section 191.52(c)(2). The comment
suggested that the reference in section 191.52(c)(2) to "or
certified copies thereof" be removed in order to conform to
C.S.D. 82-59. Customs response was:
Customs disagrees. That ruling merely stated that
copies of bills of lading, etc., which indicate that
the goods were received by the exporting carrier, would
be sufficient to support a notice of exportation. This
is the "certification" to which section 191.52(c)
refers.
The statement in T.D. 83-212 does not state that unsigned copies
of the subject documents are sufficient to support a notice of
exportation. Customs position, as stated in T.D. 83-212, is not
inconsistent with accepting a signed copy of a bill of lading.
According to C.S.D. 80-99, a signed bill of lading is sufficient
to support an uncertified notice of exportation. Therefore the
question of whether or not the bills of lading are signed is not
moot. However, we believe that the statement regarding
certification could have been more clearly made. What was
intended was a statement that the term "certification" refers to
the documents at issue. That is, that the copies of bills of
lading, etc., which indicate that the goods were received by the
exporting carrier, and which would be sufficient to support a
notice of exportation are the documents, copies of which should
be certified, in order to support an uncertified notice of
exportation.
Nothing in prior Customs decisions or the Customs
Regulations indicates that an unsigned and uncertified copy of a
bill of lading is sufficient to support an uncertified notice of
exportation. Furthermore, 19 CFR 191.62(b), pertaining to the
filing of drawback claims, requires a drawback entry covering
exports under 19 CFR 191.52(c)(2), to include the notice of
exportation and the original or certified copy of the supporting
document. In the proposed drawback regulations, Notice of
Proposed Rulemaking, published in the Federal Register, January
21, 1997 (62 FR 3082), and Customs Bulletin, January 29, 1997, at
p. 21, the language in proposed section 191.72(a) pertaining to
documentary evidence of exportation refers to " original bill of
lading, air waybill, freight waybill, Canadian Customs manifest,
and/or cargo manifest, or certified copies thereof, issued by the
exporting carrier". Therefore, no change in the general
requirements of supporting documents is proposed.
Finally, GCDS also suggests that the signed declaration made
on the CF 331 and/or the CF 7539 are sufficient as
"certification." We do not agree. The language of 19 CFR
191.52(c)(2) clearly requires certified copies of the subject
documents, if original or signed copies are not available, and an
alternative declaration is not sufficient.
Of the two bills of lading submitted, the one with the
individual's name typed on the signature line and the "clean on
board" date, is sufficient to support an uncertified notice of
exportation. The typed name is sufficient certification or
authentification, in accordance with C.S.D. 80-99, and the date
reflects that the goods were received by the exporting carrier.
The second bill of lading, however, which has no form of
signature on the signature line, and no other certification or
authentification, and no "on board" date, is insufficient to
support an uncertified notice of exportation.
We note that the CF 7511s submitted do not include a date of
exportation in the space provided, and are unsigned. Without
signatures and without a date of exportation being included, and
if no date is provided in the supporting documentation, Customs
may not consider the drawback claim complete, as it does not
establish "fully the time and fact of exportation," in accordance
with 19 CFR 191.52(c)(2).
HOLDING:
Bills of lading which are not original, and have neither
perforated, typewritten or other facsimile signatures nor other
certification of authenticity, are not sufficient to support an
uncertified notice of exportation under 19 CFR 191.52(c)(2).
This decision should be mailed by your office to the
internal advice requester no later than 60 days from the date of
this letter. On that date the Office of Regulations and Rulings
will take steps to make the decision available to Customs
personnel via the Customs Rulings Module in ACS and the public
via the Diskette Subscription Service, Freedom of Information Act
and other public access channels.
Sincerely,
Director,
International Trade Compliance
Division