1471.14 Wool yarn, wool fiber, and wool top duty compensation payment.§ 1471.14 Wool yarn, wool fiber, and wool top duty compensation payment.
(a) Definitions. In this section the following definitions apply:
(1) Duty. The term “duty” means the duty rate codified in the HTS for a year that is applicable to qualifying wool of the kind described in subheadings 9902.51.13 and 9902.51.14 of the 2014 HTS.
(2) Eligible person - (i) In general. The term “eligible person” means a manufacturer (or a successor-in-interest to the manufacturer) in the U.S. or in a Foreign-Trade Zone authorized under the Foreign-Trade Zones Act of 1934 (19 U.S.C. 81a-81u) during the calendar year immediately preceding the payment that
(A) Imported qualifying wool; and
(B) Manufactured the qualifying wool directly or had another person manufacture the qualifying wool providing the eligible person owned the qualifying wool at the time it was manufactured.
(ii) Successor-in-interest. If a person satisfies the criteria for becoming a successor-in-interest to an eligible person under paragraph (a)(4) of this section, the person shall succeed to the status of the eligible person and become eligible for the payment.
(3) Qualifying wool. The term “qualifying wool” means imported wool yarn of the kind described in subheading 9902.51.13 of the 2014 HTS, and imported wool fiber or wool top of the kind described in subheading 9902.51.14 of the 2014 HTS, that, during the calendar year immediately preceding the payment was
(i) Imported, directly or indirectly, by an eligible person (or a successor-in-interest) into the U.S.; and
(ii) Manufactured by the eligible person in the U.S.
(4) Successor-in-interest. The term “successor-in-interest” means a person that is eligible to claim a payment under this section as if the person were the original eligible manufacturer, without regard to section 3727, title 31, U.S. Code because of
(i) An assignment of the claim;
(ii) An assignment of the eligible person's right to manufacture under the same trade name; or
(iii) A reorganization of the eligible person.
(b) Import duties. The duties on imports of qualifying wool were suspended in their entirety in section 503 of the Trade and Development Act of 2000. The suspension of the duties for both HTS subheadings of qualifying wool was extended through December 31, 2014. These duties were reinstated as of January 1, 2015.
(c) Duty compensation payment - (1) Calculation of payment. For each of the 2015-2019 calendar years the duty compensation payment of an eligible person will be established by calculating, as provided in paragraphs (c)(2) through (5) of this section, the savings that would have been realized by the eligible person for imports of qualifying wool had the duty suspension been in effect.
(2) Savings for each subheading. The savings realized by an eligible person for imports of qualifying wool under a HTS subheading covered by this section shall be obtained by multiplying
(i) The reported dollar value of imports under a HTS subheading during the calendar year immediately preceding the payment; and
(ii) Except as provided in paragraph (c)(5) of this section, the duty applicable to that HTS subheading in the calendar year preceding the payment, converted to numeric value.
(3) Sum of subheading savings. The product obtained in paragraph (c)(2) of this section for imports of qualifying wool previously described under each HTS subheading shall be added to the savings obtained for imports under the other HTS subheading (as applicable).
(4) Duty compensation payment amount. The sum obtained in paragraph (c)(3) of this section shall equal the annual duty compensation payment for the eligible person for the applicable calendar year.
(5) Exception for 2015 payment. In the case of the 2015 payment, for purposes of the calculation component described in paragraph (c)(2) of this section the duty rate applicable in 2015 shall be deemed the duty rate actually paid in 2014. The reason for this exception for the 2015 payment is that 2014 is both the last year in which the duty suspension was still in effect, and is also the calendar year immediately preceding the payment (the payment is in 2015). As a result, for the 2015 payment, a proxy is necessary for the higher duty rate in the calendar year immediately preceding the payment.
(d) Annual affidavit required - (1) In general. An eligible person applying for a payment under this section shall comply with all applicable reporting requirements described in this section and § 1471.10.
(2) Specific business information - (i) Imports and production. An eligible person shall, for the calendar year immediately preceding the payment, report the actual dollar value and the actual quantity of:
(A) Imports into the U.S. of qualifying wool by the eligible person; and
(B) Such qualifying wool that was manufactured in the U.S. by the eligible person.
(ii) Direct and indirect importers - (A) In general. Eligible persons that import qualifying wool through a third party broker are considered to be indirect importers of the qualifying wool. Persons that directly import qualifying wool and pay the import duty for such wool are considered to be direct importers of the qualifying wool.
(B) Reported dollar value. Eligible persons must state in their annual affidavit whether, in the calendar year immediately preceding the payment, they were direct or indirect importers, and the dollar value of the imported qualifying wool. The reported dollar value of imports by indirect importers will be subject to a 10% reduction.
(C) Affirmation. An eligible person shall annually affirm in the affidavit that, in the calendar year immediately preceding the payment, the eligible person
(1) Directly or indirectly imported the qualifying wool into the U.S.;
(2) Manufactured the qualifying wool in the U.S.; and
(3) Imported qualifying wool from the country of origin identified in the affidavit.
(iii) Import documentation - (A) Direct imports. Applicable to the calendar year immediately preceding the payment, an eligible person that directly imported qualifying wool is required to submit to FAS as part of the affidavit package scanned copies of CBP Form 7501 “Entry Summary” for the relevant calculations made in the affidavit.
(B) Indirect imports. Applicable to the calendar year immediately preceding the payment, an eligible person that indirectly imported qualifying wool is required to submit to FAS as part of the affidavit package invoices from third party brokers for the relevant calculations made in the affidavit.
(3) Manufacture of qualifying wool. When reporting the annual dollar value and quantity of imported qualifying wool, and the annual dollar value and quantity of the qualifying wool that was manufactured, an eligible person may either have manufactured the qualifying wool on its own behalf or had another person manufacture the qualifying wool, provided the eligible person owned the qualifying wool at the time of manufacture.[80 FR 12327, Mar. 9, 2015, as amended at 81 FR 81660, Nov. 18, 2016]