My organization feels and believes that world trade is a two-way street; that so long as our exports exceed our imports that our economy is in more or less safe hands. On this premise they endeavor to promote trade between European nations and the United States. In view of the time restrictions, I shall endeavor to be brief and talk upon only one phase of the customs-simplification bill, H. R. 5505, that being section 17 of said proposed bill. Subsection A of this amendment would eliminate the present law which authorizes the amendment of entries by either increasing or decreasing the entered value at any time before the appraisement of the merchandise. In order that the committee may properly consider this section, I wish to go on record as saying that all import organizations which I know of-customs brokers' associations and even the Bar Association of Customs Attorneys are strenuously opposed to this section. We do not believe that in proposing same that the Treasury Department realizes that innocent persons can be severely penalized for undervaluation or fail to obtain allowances or refunds in the event the merchandise was entered at a higher value than the proper dutiable value. At the present time-and the practice would continue under the provisions of the proposed bill-that before an importer can make an entry of merchandise paying an ad valorem rate of duty, he must first submit to the examiner, prior to entry, his consular invoice, commercial invoice, contracts, orders, price lists, quotations, correspondence, and all other documents or information in his possession at that time. He must set forth in a submission sheet a full description of the merchandise, the invoice price, the date of order, the date of subsequent orders, and their dates of acceptance and prices; also, subsequent quotations up to the date of submission, the date of such quotations, and their prices. The appraiser then would advise of a tentative value at which the entry can be made, and if, at the time of appraisement, the appraised value is higher or lower, the collector of customs would not follow the appraiser's findings in respect to liquidating at a lower price or penalizing where the value is higher if the examiner reports that in his opinion all of the requirements as set forth above were not complied with. In other words, the examiner would be the sole judge in such matters, and, as an example, an importer may receive quotations from several sources abroad-all of which he is not interested in and would cast aside. The appraiser may have information from said manufacturers that he sent those quotations to the importer, and if the importer did not, in his submission, bring same to the attention of the examiner, then said importer would either be subject to penalty in the event of an advanced value or denied a refund in the event of appraisement made at a lower value. Naturally, where there would be a penalty, there would be appeals for either reappraisement or remission of the penalty, which, in the writer's opinion, would jam the court calendars of the already overburdened customs courts. I, therefore, appeal to this committee to disregard this section of the bill entirely, as it does not tend to simplify but only to confuse. Senator KERR. What you are saying is that you are requesting that that section of the bill Mr. MERCER. Be stricken. Senator KERR (continuing). Be stricken. Mr. MERCER. Right. It serves no useful purpose. Senator KERR. Do you have any comment on the testimony of some people here with reference to the time in which appraisals must be made? Mr. MERCER. Yes, I believe there should be a reasonable time during which an importer may be in a position to calculate just what his duties are, so he can apply it to the cost of his goods. There are some appraisements which have been withheld 4, 5, 6 years, and an importer today does not even know what his duties are going to be because of the withheld appraisement. I would like to add, Senator, that previous information which was just testified to in respect to the Canadian invoice, where it was said that the Canadians have in their invoice a column which sets forth the fair market price to give the Canadian authorities a basis for assessing their duties as between the purchase and the fair market price, well, our consular invoice is even more effective because we have a column 11 on that invoice which sets forth the home market value for that particular shipment. Senator KERR. Sets forth what? Mr. MERCER. Sets forth the home market value of the merchandise covered in that invoice; and furthermore, the Canadian invoice is not a sworn document, but the American consular invoice is. I am just passing that out for the information of the committee. Senator KERR. You take the position that the situation should be maintained as it is now with reference to that? Mr. MERCER. Section 17, yes. Senator KERR. Well, that would be the effect of deleting section 17? Mr. MERCER. That is right. Senator KERR. All right, Mr. Mercer. Mr. MERCER. Thank you very much for permission to appear before you. Senator KERR. We thank you. (The prepared statement of Mr. Mercer is as follows:) STATEMENT OF WALTER J. MERCER, DIRECTOR IN THE AMERICAN CHAMBER OF COMMERCE FOR TRADE WITH ITALY, INC., NEW YORK, N. Y., RE CUSTOMS SIMPLIFICATION ACT OF 1951 My name is Walter J. Mercer. I am the president of the Hudson Shipping Co., Inc., 8-10 Bridge Street, customhouse brokers and foreign freight forwarders, established 1893. I am a director in the American Chamber of Commerce for Trade With Italy, Inc., 105 Hudson Street, New York 13, N. Y. I am making this statement as their representative. This chamber which was established in 1887, has as its prime purpose the developing and fostering of trade between the United States and Italy. An overwhelming majority of its members are American businessmen engaged in either importing or exporting or both. Its members are located principally in the New York area. The chamber is deeply concerned with legislation affecting the foreign trade of this country. Our members look to this association for information regarding any change in rules or regulations, tariff, etc., especially any legislation which may tend to provide relief from the numerous provisions which an importer must comply with in effecting clearance through customs. The purpose of H. R. 1535, as stated by the Treasury Department, is to amend the Tariff Act of 1930, as amended, in order to simplify its operation, to reduce expenses and delay incidental to its administration, and to eliminate inequities whch add to the difficulties of enforcement. The business of importing today represents an endless list of regulations, requirements, and difficulties, many of which can be eliminated to permit a freer flow of merchandise into this country, and thereby promote better trade conditions with the countries throughout the world. We are in accord with the principle and purpose as outlined in the new Customs Simplification Act of 1951, with certain exceptions. However, we feel that the act does not go far enough in providing the relief which its purposes indicate. Section 13 of the proposed bill: The elimination of "foreign value" and "American selling price," as a basis for determining dutiable value should result in a considerable saving of time on the part of the customs examiner as it narrows down the considerations in arriving at dutiable value. We feel, however, that the proposal is defective in the following two respects: (1) The appraiser should definitely state in his final appraisement what his basis of value, i. e., "export value," "United States value," etc. (2) There should be a definite time limitation within which the appraiser should complete his appraisement. Section 16 of the proposed bill: We are strenuously opposed to the proposed changes in this section unless they are restricted to noncommercial shipments. Section 17 of the proposed bill: Subsection (A) this amendment would eliminate the present law which authorizes amendment of entries to increase or decrease the entered value at any time before the appraisement of the merchandise. We vigorously object to this proposal for the following reasons. This proposal would abolish the right of amendment of an entry under any circumstances once an entry has been made. It is too harsh and also entirely unnecessary. There are situations where, from the point of view of the Government, of the customhouse brokers, and of the importer, it would be salutary to permit amendment of entries. Without the right to amend the entry, the additional duties provided for in this section may well be imposed on an innocent person who, if permitted to amend his entry, could have avoided these additional duties and yet paid to the Government what was lawfully due. We believe that the concept of additional duties is wrong and it should be discarded entirely. If there is an honest dispute between an importer and the Government, the dispute should be resolved in the proper forum without any penalty. If an importer commits fraud or deceit, there are other provisions in the law which amply punish him, either through criminal prosecution or civil penalties against him personally or against the goods imported. We believe the foregoing observations represent the consensus of the opinion of our asociation insofar as it relates to importing. And it is for this reason that we respectfully present them to the committee for consideration. Senator KERR. The committee will recess until 10 o'clock in the morning. (Whereupon, at 12: 30 p. m., the committee recessed to reconvene at 10 a. m. Friday, April 25, 1952.) CUSTOMS SIMPLIFICATION ACT FRIDAY, APRIL 25, 1952 UNITED STATES SENATE, The committee met, pursuant to adjournment, at 10 a. m., in room 312, Senate Office Building, Senator Spessard L. Holland presiding. Present: Senator Holland. Also present: Elizabeth B. Springer, chief clerk, and Serge N. Benson, professional staff member. Senator HOLLAND. The committee will come to order. Senator George has asked me to preside briefly this morning for the purpose of proceeding with the hearing begun some time ago under the Customs Simplification Act as proposed in H. R. 5505. I understand that there are several witnesses here. I will call them in the order that their names are listed here. STATEMENT OF EUGENE R. PICKRELL, REPRESENTING CARBIC COLOR & CHEMICAL CO., INC., AND SANDOZ CHEMICAL WORKS, INC. Mr. PICKRELL. Mr. Chairman and members of the committee, my name is Eugene R. Pickrell. I am an attorney at law, with offices at 10 East Fortieth Street, New York, N. Y. I specialize in customs, tariff, and Federal matters, and have been engaged in such practice for upward of 20 years. I have been admitted to practice before the courts of record of the State of New York, United States Customs Court, United States Court of Customs and Patent Appeals, and other Federal courts. I was formerly chief chemist of the United States Customs Service, port of New York. Since the Tariff Act of 1922 was enacted by Congress, I have handled matters relating to importations of coal-tar products before the United States Customs officials and before the United States Customs Court and before the United States Court of Customs and Patent Appeals. I appear before this committee in behalf of my clients, Carbic Color & Chemical Co., Inc., and Sandoz Chemical Works, Inc., importers of coal-tar dyes, coal-tar intermediates, and coal-tar auxiliaries, with offices located at, respectively, 451-453 Washington Street, New York, N. Y., and 61 Van Dam Street, New York, N. Y. 179 |