designated by the refiner as the basis for the drawback claim shall be of the same kind and quality (class) as that used in the manufacture of the exported petroleum products and shall have been used within 3 years after the date on which it was received by the refiner. Duty-paid crude petroleum or petroleum derivatives used at a plant of a refiner within 3 years after the date it was received may be designated as the basis for the allowance of drawback on petroleum products manufactured at another plant of the same refiner.

(4) For purposes of substitution, crude petroleum and petroleum derivatives

(hereinafter called raw material) will be divided into the following classes: Class I, 0-11.9° API gravity; Class II, 12°-24.9° API gravity; Class III, 25°-44.9° API gravity; and, Class IV, 45°-up API gravity. Any crude petroleum included in any class shall be considered for the purposes of these regulations as being of the petroleum included in the same class; similarly, any named derivative in any class shall be considered as being the same kind and quality as the same named derivative in the same class.

(5) The amount of any one type and class of raw material which may be designated as the basis for the allowance of drawback on the exported products produced at a given refinery and covered by a drawback entry shall not exceed the quantity of such raw material used at the refinery during the abstract period or periods from which the exported products were produced. The quantity of raw material to be designated as the basis for the allowance of drawback on exported products must be at least as great as the quantity of raw material of the same type and class which would be required to produce the exported products in the quantities exported.

(6) For the purpose of distributing the drawback to the several products in accordance with section 313, Tariff Act of 1930, relative values shall be established at the time of separation between all products manufactured. The entire period covered by an abstract shall be deemed the time of separation of the products, and the value per unit of each product shall be the average market value for the abstract period.

(7) The refiner's manufacturing records shall consist of daily gauge reports on all raw material storage tanks, or if no storage tanks are maintained, daily meter records of raw material received. They will also show daily quantities and description of all materials introduced into the manufacturing process, and the quantity and description of each product manufactured.

(8) An abstract from the aforementioned records shall be filed with the collector of customs covering manufacturing periods of not less than 28 days and not more than 31 days, unless a different period shall have been authorized. PRODUCTION

Item (6) Products shall be shown on the abstract in the net quantities realized in the refining process and shall not include non-petroleum additives.

Item (9) Quantity of crude (sum of all classes and derivatives) allowable per barrel of product.

A separate abstract will be prepared by each refiner for each refinery from which an export shipment may be made. The abstract filed for each refinery, in the following form, shall be signed by an officer of the company or by an employee with customs power of attorney having knowledge of the facts.

(10) The refiner shall file a combination drawback entry and certificate of manufacture showing the products exported in the quantities as established by notices of exportation and notices of lading. Inasmuch as exported products, as described on notices of exportation and notices of lading, may include quantities of nonpetroleum additives, a recapitulation shall be made showing quantities exported and the quantity of each product (less additives) in terms of the abstract.

(11) The total quantity of raw material on which drawback may be based, subject to limitations hereinafter specified, shall be computed by multiplying the quantity (in the terms of the abstract) of each product exported by the drawback factor for that product. See "Inventory Control Sheet" for method of accounting.

(12) The amount of drawback determined in accordance with these regulations shall be limited by the quantity of imported duty-paid raw material of the same kind and quality as that used in the manufacture of the exported products in a quantity sufficient to produce such products, with due regard to the products producible concurrently with the exported products and shall not exceed 99 per centum of the duty paid on

Item 16 should list only products exported.

Item 17 should be in condition as shown on the notices of exportation and notices of lading.

Item 18 should be in condition as shown on the abstract (i.e., less additives if any).

Item 19 is the lowest drawback factor (inventory or production) shown on the Inventory Control Sheet.

Item 20 is the result of multiplying item 18 by item 19. Liquidation: Total crude (as above) allowable for drawback X rate of duty on crude designated=gross drawback allowable. Less 1 percent thereof=net drawback due claimant.

the imported merchandise against which drawback is claimed.

(13) The exportation of a given quantity of a product affords a proper basis for the allowance of drawback only to the extent that the product could have been produced in that quantity (together with the quantities of related products concurrently producible) from the imported duty-paid material. The test is whether the conversion is practicably possible by ordinary manufacturing techniques, not laboratory techniques, and is not whether the conversion was actually made.

(14) Industry Standards of Potential Production on a Practical Operating Basis shall be submitted by the industry for each type and class of raw material. Upon verification and adoption by the Bureau, the standards may be used to establish that the exported products in the quantity exported could have been produced from the quantity of imported duty-paid raw materials designated by the refiner as the basis for the allowance of drawback on the exported products.

(15) While the drawback factors for the products exported will be established on the basis of the volume and values covering the actual production during the refining period of the given refiner, as shown on the abstract filed by that refiner, it is not necessary that the refiner export products in the same percentages as they appear on the abstract, nor need he export products in the exact percentages shown on the applicable standard of potential production. He may limit his exportations to one product and disregard the related products provided that, (i) the drawback allowance shall not exceed 99 per centum of the duty paid on the raw material allowable for designation, and (ii) sufficient duty-paid raw materials (of the required kind and quality) to produce the exported product (together with the quantities of the related products concurrently producible) are available to constitute a proper basis for the allowance of drawback on the exported products.

(16) Whether the exported product or products could have been produced on a practical operating basis from the quantity of duty-paid raw material designated in the drawback entry as the basis for the allowance of drawback on the exported product or products may be established by reference to the standard or standards of potential production for

each type and class of raw material identified by the claimant in his drawback entry.

(17) No claim for drawback against imported raw materials shall be allowed unless the refiner in connection with each such claim shall certify that all of the products exported for which drawback has been or are being claimed could be produced concurrently on a practical operating basis from the imported raw materials against which drawback is claimed.

(h) Piece goods. Drawback may be allowed under the provisions of section 313(a), Tariff Act of 1930, upon the exportation of bleached, mercerized, printed, dyed, or redyed piece goods manufactured or produced by any one or a combination of the foregoing processes with the use of imported or drawback woven piece goods, subject to the following special regulations:

(1) The records of the manufacturer or producer shall show, as to each lot of piece goods manufactured or produced for exportation with benefit of drawback, the lot number and the date or inclusive dates of manufacture or production, the quantity, identity, and value of the imported or drawback piece goods used, the condition in which imported or received (whether in the gray, bleached, dyed, or mercerized), the working allowance specified in the contract under which they are received, the process or processes applied thereto, and the quantity and description of the piece goods obtained.

(2) The records also shall show the yardage lost by shrinkage or gained by stretching during manufacture, and the quantity of remnants resulting and of spoilage incurred.

(3) Further, the records shall show the quantity of rag waste incurred and its value. In instances where it is impracticable to account for the actual quantity of rag waste incurred, it shall be assumed in liquidation that such rag waste constituted 2 percent of the piece goods put into process.

(4) The piece goods manufactured or produced hereunder may also be subjected to one or more finishing processes.

(5) An abstract of the manufacturing or production records shall be filed with the drawback entry.

(6) The quality of piece goods upon which drawback may be allowed shall be computed as follows: Deduct from the quantity of piece goods received the quantity of remnants and spoilage, if any, incurred, the proper allowance to be made for shrinkage or stretch, of any, occurring during manufacture or production. Reduce the remaining quantity by the quantity thereof which the value of the rag waste will replace. When necessary for the purposes of liquidation, the value of the imported or drawback piece goods used shall be furnished by the owner.

(7) The drawback allowance shall not exceed the duty paid, less 1 per centum thereof, on the net quantity of finished piece goods exported, determined as above, as shown by the abstract of the manufacturing or production records; or, in the case of piece goods manufactured or produced hereunder with the use of drawback piece goods, the drawback accruing to such net quantity, as established by the abstract of the manufacturing or production records and the certificates of manufacture and delivery covering the drawback piece goods concerned.

(8) Drawback shall not be allowed hereunder when the process performed results only in the restoration of the articles to their condition at the time of importation.

(1) Fur skins and fur skin articles. Drawback may be allowed under the provisions of section 313 (a), Tariff Act of 1930, upon the exportation of dressed, redressed, dyed, redyed, bleached, blended, or striped fur skins or fur skin articles manufactured or produced by any one or a combination of the foregoing processes with the use of fur skins or fur skin articles, such as plates, mats, sacs, strips, and crosses, imported in a raw, dressed, or dyed condition, subject to the following special regulations:

(1) The records of the manufacturer or producer shall show, as to each lot of fur skins and fur skin articles manufactured or produced for exportation with benefit of drawback, the lot number and the date or inclusive dates of manufacture or production, the quantity, identity, and description of the imported merchandise used, the condition in which imported, the process or processes applied thereto, the quantity and description of the finished articles obtained, and the quantity of imported pieces rejected, if any, or spoiled in manufacture or production.

(2) An abstract of the manufacturing or production records shall be filed with the drawback entry.

(3) The drawback allowance shall not exceed the duty paid, less 1 per centum thereof, on the quantity of imported merchandise used in the manufacture or production of the exported articles, as shown by the abstract of the manufacturing or production records. The quantity of imported merchandise used shall be determined by deducting from the quantity of fur skins or fur skin articles put into manufacture or production the quantity of rejects and spoilage incurred, if any.

(4) Drawback shall not be allowed hereunder when the process performed results only in the restoration of the articles to their condition at the time of importation.

[28 F.R. 14778, Dec. 31, 1963, as amended by T.D. 56288, 29 F.R. 14493, Oct. 22, 1964; T.D. 56487, 30 F.R. 12280, Sept. 25, 1965; T.D. 68-203, 33 F.R. 11991, Aug. 23, 1968; T.D. 68-239, 33 F.R. 14593, Sept. 28, 1968; T.D. 71-143, 36 F.R. 10848, June 4, 1971]

§ 22.7 Notice of exportation.

(a) A notice of exportation in triplicate, on customs Form 7511, for each shipment of merchandise on which drawback is to be claimed shall be filed by the exporter or his agent with the collector of customs at the port at which the shipment is to be exported from the United States. Such notice shall show the name of the exporting vessel or other carrier, the number and kind of packages and their marks and numbers, the description of the merchandise and its weight (gross and net), gauge, measure,

If the exporter desires, he may file an extra copy of the notice of exportation with the collector for numbering and return to him for use for reference or other purposes in pursuing his claim.

or number, the name of the exporter, and the name of the port where the drawback entry is to be filed. If the merchandise is to be exported in railroad cars, a notice of exportation shall be filed for each car.

(b) Except as provided for in §§ 22.8 and 22.9, the notice of exportation shall be filed with the shipper's export declaration, or, if filed subsequently, it shall be filed within 3 years after exportation and shall state the number, if any, and date of the shipper's export declaration. One shipper's export declaration may cover several notices of exportation. A notice of exportation not filed in the time and manner herein specified shall not be accepted unless its acceptance is specifically authorized by the Bureau.

(c) Upon receipt of the notice of exportation, the collector shall assign a number thereto which shall be stamped or endorsed on the original and each copy of the notice. If a number has been assigned to the corresponding shipper's export declaration, the same number shall be assigned to the notice of exportation. If a shipper's export declaration covers more than one notice of exportation, one of the notices shall be assigned the same number as that assigned to the shipper's export declaration; the remaining notices shall also be assigned the same number but each notice shall be further identified by the addition of

an

alphabetic designation beginning with the letter "A". However, if no number has been assigned to the shipper's export declaration, each notice of exportation shall be separately numbered. On one of the copies of the notice, the collector shall certify (1) as to the exportation of the merchandise as shown by the records of his office, and (2) as to the name of the exporter as shown by the shipper's export declaration covering the merchandise. The collector shall return such copy and one uncertified copy to the exporter, or to the person designated by the exporter, for subsequent filing with the drawback entry. Whenever the collector is unable to certify to the exportation of the merchandise covered by the notice of exportation, he shall return two copies of the notice to the exporter or to the person designated by the exporter, with a statement of the facts in the case.

(d) When drawback is to be claimed under section 313 (a), (b), or (g), Tariff Act of 1930, on an aircraft departing under its own power from the United

States, or on merchandise exported by aircraft, the notice of exportation shall be filed in the manner prescribed herein at the port where the shipper's export declaration is filed.

(e) When merchandise is laden on a vessel for transshipment at a domestic port outside the continental United States, the notice of exportation shall be filed with the collector of customs at the port where the merchandise was last transshipped for its foreign destination (the place where the shipper's export declaration is filed).

§ 22.8 Notice of exportation; mail ship

ments.

(a) If the merchandise on which drawback is to be claimed is to be exported by mail or parcel post, the notice of exportation shall be prepared in quadruplicate. Three copies shall be filed with the postmaster at the place of mailing, and the merchandise shall be delivered to the postmaster at the same time and mailed under his supervision. The fourth copy shall be retained by the exporter for subsequent filing with the drawback entry. Such notices shall be numbered by the exporter in accordance with § 22.10.

(b) Each package to be exported shall have stamped or written thereon a waiver of the right to withdraw the package from the mails, signed by the exporter.

(c) After the packages have been mailed, the postmaster will execute his certificate on one of the copies of the notice of exportation and return such copy to the person who presented the notice, for subsequent filing with the drawback entry. One copy of the notice will be postmarked by the postmaster and mailed by him to the collector of customs at the port where the notice shows the drawback entry is to be filed, and the other copy will be retained by the postmaster as his record of the

transaction.

[28 F.R. 14778, Dec. 31, 1963, as amended by T.D. 70-89, 35 F.R. 6003, Apr. 11, 1970] § 22.9 Notice of exportation; government shipments.

(a) In the case of a shipment by a department, branch, or agency of the United States Government, if no shipper's export declaration is required, the notice of exportation for such a ship

Such as San Juan, P. R., or Honolulu, Hawaii.