Cattle Imported In Bond for Feeding and Return to Mexico

DEPARTMENT OF AGRICULTURE

Animal and Plant Health Inspection Service

9 CFR Parts 91 and 93

[Docket No. 94-076-2]

Cattle Imported In Bond for Feeding and Return to Mexico

AGENCY: Animal and Plant Health Inspection Service, USDA.

ACTION: Final rule.

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SUMMARY: We are adopting as a final rule, with one change, an interim

rule that amended the animal exportation and importation regulations by

removing provisions that allowed the temporary, in-bond importation of

cattle from Mexico into the United States for feeding and return to

Mexico for slaughter. That interim rule was necessary because the U.S.

Customs Service, to comply with provisions of the North American Free

Trade Agreement, had discontinued its collection of duties and cash

bonds on cattle imported into the United States from Mexico; without a

cash bond, we were unable to meaningfully penalize importers who failed

to return those cattle to Mexico. We continue to believe that the

termination of the in-bond program was necessary to prevent the

dissemination of animal diseases into the United States by in-bond

cattle that may have remained in the United States in violation of the

regulations.

EFFECTIVE DATE: January 5, 1998.

FOR FURTHER INFORMATION CONTACT: Dr. David Vogt, Senior Staff

Veterinarian, National Center for Import and Export, VS, APHIS, 4700

River Road Unit 39, Riverdale, MD 20737-1231; (301) 734-8170.

SUPPLEMENTARY INFORMATION:

Background

The regulations in 9 CFR part 93 prohibit or restrict the

importation of certain animals into the United States to prevent the

introduction of communicable diseases of livestock and poultry. Subpart

D of part 93 (Secs. 93.400 through 93.435), referred to below as the

regulations, pertains to the importation of ruminants. Sections 93.424

through 93.429 of the regulations contain specific provisions regarding

the importation of ruminants, including cattle, from Mexico.

Note: At the time the interim rule referred to in this document

was published, the provisions described in the previous paragraph

were located in 9 CFR part 92. However, on October 28, 1997, we

published in the Federal Register (62 FR 56000-56026, Docket No. 94-

106-9) a final rule that redesignated part 92 as part 93. In

describing the actions taken in the interim rule, we will use the

part and section numbers used in the interim rule; where

appropriate, however, we will cross-reference part 92 citations with

their current locations in part 93.)

In an interim rule published in the Federal Register on March 15,

1995 (60 FR 13896-13898, Docket No. 94-076-1), and effective March 30,

1995, we amended the regulations by removing Sec. 92.427(e), ``Cattle

imported in bond for feeding and return to Mexico,'' in its entirety

and by removing five references to the in-bond program that were found

elsewhere in part 92 and in the animal export regulations in 9 CFR part

91. Before the effective date of the interim rule, Sec. 92.427(e) of

the regulations provided for the temporary importation of cattle from

Mexico into the United States under U.S. Customs bond for feeding and

return to Mexico for slaughter. Cattle imported under that in-bond

program were exempt from some animal disease testing requirements that

applied to the importation of other cattle from Mexico, but were

subject to additional restrictions during the time they were in the

United States that did not apply to other cattle imported from Mexico.

We solicited comments concerning the interim rule for 60 days

ending May 15, 1995. We received six comments by that date. They were

from a foreign government, foreign and domestic trade associations and

industry groups, and a customs brokerage. One of the commenters

strongly supported the interim rule, while the remaining five

commenters opposed the discontinuation of the program. Their comments

are discussed below.

Two commenters reported that they had experienced no problems with

the in-bond program and felt that it could continue in the absence of a

bond, but offered no specific evidence to support their position.

Similarly, two other commenters stated that the in-bond program had

presented no animal health problems in its 5 years of existence, so

there was no reason to believe that the opposite would be true in the

future. Those commenters stated that the safeguards contained in the

in-bond program, such as the use of sealed vehicles for movement and

the requirement that in-bond cattle be held in quarantined feedlots,

had proven sufficient in the past to prevent the spread of disease, and

could continue to do so. We agree that the quarantine and movement

restrictions of the in-bond program were effective in mitigating the

disease risk associated with in-bond cattle. However, as we stated in

the interim rule, the actions of some importers led us to believe that

the posting of a bond was necessary to ensure compliance with those

provisions of the in-bond program. Without the authority to institute a

bond system similar to that administered by the U.S. Customs Service at

U.S. ports of entry on the Mexican border prior to January 1, 1994, we

found that it was necessary to terminate the in-bond program in order

to prevent animal diseases from being introduced into, and disseminated

within, the United States.

One commenter stated that the Animal and Plant Health Inspection

Service (APHIS) was incorrect in claiming that cattle imported

temporarily for feeding and return to Mexico were no longer covered by

a bond; Customs bonds do still apply, the commenter argued, so the in-

bond program could continue. We noted in the interim rule that Customs

and APHIS continued to allow temporary importations of cattle from

Mexico even after January 1, 1994, when the Customs Service

discontinued its collection of duties and cash bonds on imported

Mexican cattle in order to comply with provisions of the North American

Free Trade Agreement (NAFTA). From January 1, 1994, until March 30,

1995, the effective date of the interim rule, the entry of those cattle

was covered by a

[[Page 64266]]

paperwork-only bond, with no money involved, so in terms of a Customs

bond being applied to temporary importations of Mexican cattle, the

commenter is correct. Our interim rule should have stated that cattle

imported for feeding and return to Mexico were no longer covered by a

cash bond, and that it was the absence of any cash bond that led to our

determination that the in-bond program should be terminated.

One commenter contended that the interim rule violated the terms of

NAFTA by instituting a sanitary measure without providing a risk

assessment, considering alternatives and economic impacts, or providing

the required 60-day notice to Mexico.

The interim rule contained a discussion of the increased disease

risks associated with the in-bond program and the measures that had

been in place to mitigate those risks. As stated in the interim rule,

the additional risks stemmed largely from the fact that in-bond cattle

were exempted from meeting certain testing requirements for brucellosis

and tuberculosis; those risks had been mitigated by the quarantine and

movement restrictions of the in-bond program, and the cash bond had

served to ensure that the quarantine and movement restrictions were

observed. The termination of the in-bond program was based on our

determination that the loss of the cash bond rendered our mitigating

measures less effective than we believed was necessary.

The interim rule also discussed alternatives to ending the in-bond

program, e.g., continuing with a paperwork-only bond and the

possibility of APHIS implementing its own bond system. Further, an

economic analysis was provided in the interim rule to satisfy the

requirements of Executive Order 12866 and the Regulatory Flexibility

Act.

With regard to the 60-day notice, NAFTA allows a party to omit such

notice when the party considers it necessary to take measures to

address an urgent problem relating to sanitary and phytosanitary

protection. In such cases, the party must: (1) Immediately provide a

notification of the measures, including a brief description of the

urgent problem; (2) provide a copy of such measures upon request; and

(3) allow other parties and interested persons to make comments in

writing and, upon request, discuss such comments and take such comments

and the results of such discussions into account. All three of those

requirements were satisfied by the interim rule in that it provided

notification of our termination of the in-bond program 15 days prior to

the effective date of that action; set forth a description of the

urgent problem that led us to publish the interim rule without prior

opportunity for public comment; provided a full description of the

measures we were taking; and provided a 60-day comment period during

which interested persons could submit comments for APHIS'

consideration.

One commenter stated that the interim rule is an unjustified

nontariff trade barrier because the rule was based not on animal health

concerns, but on an administrative problem, i.e., the inability of the

Customs Service to collect the bond. We disagree with that argument

because Customs' inability to collect the bond is a reality mandated by

NAFTA, not an ``administrative problem'' that could be solved by a

change in procedure or a reallocation of resources. As explained above

and in the interim rule, we found that the bond was an important factor

in the enforceability of the restrictions designed to mitigate the

higher disease risk posed by cattle imported under the in-bond program.

If those restrictions were disregarded, there is the very real

possibility that cattle that had not been tested for tuberculosis or

brucellosis could be commingled with domestic livestock and spread

disease; we regard that as an animal health concern.

As noted above, the interim rule removed Sec. 92.427(e), which

contained the in-bond program's provisions, and five references to

those provisions found elsewhere in parts 91 and 92. Following the

publication of the interim rule, it was brought to our attention that

we failed to remove a sixth reference to the in-bond program from the

regulations in Sec. 92.427(c)(2) (current Sec. 93.427(c)(2)). We are,

therefore, removing that reference in this final rule.

Therefore, based on the rationale set forth in the interim rule and

in this document, we are adopting the provisions of the interim rule as

a final rule with the change discussed in this document.

This final rule also affirms the information contained in the

interim rule concerning Executive Order 12866 and the Regulatory

Flexibility Act, Executive Order 12372, and the Paperwork Reduction

Act.

Executive Order 12988

This rule has been reviewed under Executive Order 12988, Civil

Justice Reform. This rule: (1) Preempts all State and local laws and

regulations that are inconsistent with this rule; (2) has no

retroactive effect; and (3) does not require administrative proceedings

before parties may file suit in court challenging this rule.

List of Subjects

9 CFR Part 91

Animal diseases, Animal welfare, Exports, Livestock, Reporting and

recordkeeping requirements, Transportation.

9 CFR Part 93

Animal diseases, Imports, Reporting and recordkeeping requirements.

Accordingly, the interim rule amending 9 CFR parts 91 and 92 (now 9

CFR parts 91 and 93) that was published at 60 FR 13896-13898 on March

15, 1995, is adopted as a final rule with the change set forth below.

PART 93--IMPORTATION OF CERTAIN ANIMALS, BIRDS, AND POULTRY, AND

CERTAIN ANIMAL, BIRD, AND POULTRY PRODUCTS; REQUIREMENTS FOR MEANS

OF CONVEYANCE AND SHIPPING CONTAINERS

1. The authority citation for part 93 continues to read as follows:

Authority: 7 U.S.C. 1622; 19 U.S.C. 1306; 21 U.S.C. 102-105,

111, 114a, 134a, 134b, 134c, 134d, 134f, 135, 136, and 136a; 31

U.S.C. 9701; 7 CFR 2.22, 2.80, and 371.2(d).

Sec. 93.427 [Amended]

2. In Sec. 93.427, in paragraph (c)(2), the second sentence is

amended by removing the words ``or in bond for temporary entry in

accordance with Sec. 93.427(e)''.

Done in Washington, DC, this 1st day of December 1997.

Craig A. Reed,

Acting Administrator, Animal and Plant Health Inspection Service.

[FR Doc. 97-31899 Filed 12-4-97; 8:45 am]

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