The Secretary of State to the German Ambassador.

Excellency:

Referring to the Commercial Agreement signed this day between the Imperial German Government and the Government of the United States, I have the honor to inform you that instructions to the customs and consular officers of the United States and others concerned will be issued to cover the following points and shall remain in force for the term of the aforesaid Agreement:

A.

Market value as defined by section 19 of the Customs Administrative Act shall be construed to mean the export price whenever goods, wares, and merchandise are sold wholly for export, or sold in the home market only in limited quantities, by reason of which facts there can not be established a market value based upon the sale of such goods, wares, and merchandise in usual wholesale quantities, packed ready for shipment to the United States.

B.

Statements provided for in section 8 of the Customs Administrative Act are not to be required by consular officers except upon the request of the appraiser of the port, after entry of the goods. The Consular Regulations of 1896, paragraph 674, shall be amended accordingly.

C.

In reappraisement cases, the hearing shall be open and in the presence of the importer or his attorney, unless the Board of Appraisers shall certify to the Secretary of the Treasury that the public interest will suffer thereby; but in the latter case the importer shall be furnished with a summary of the facts developed at the closed hearing upon which the reappraisement is based.

D.

The practice in regard to “personal appearance before consul,” “original bills,” “declaration of name of ship,” shall be made uniform in the sense—

1.
That the personal appearance before the consular officer shall be demanded only in exceptional cases, where special reasons require a personal explanation.
2.
That the original bills are only to be requested in cases where invoices presented to the consular officer for authentication include goods of various kinds that have been purchased from different manufacturers at places more or less remote from the consulate and that these bills shall be returned after inspection by the consular officer.
3.
That the declaration of the name of the ship in the invoice shall be dispensed with whenever the exporter at the time the invoice is presented for authentication is unable to name the ship.

[Page 480]

Paragraph 678 of such regulations, as amended March 1, 1906, shall be further amended by striking out the words:

“Whenever the invoice is presented to be consulated in a country other than the one from which the merchandise is being directly exported to the United States.”

And by inserting after the first sentence the following clause:

“As place, in which the merchandise was purchased, is to be considered the place where the contract was made, whenever this was done at the place where the exporter has his office.”

Paragraph 681 of the Consular Regulations of 1896 relative to “swearing to the invoice “shall be revoked.

E.

Special agents, confidential agents, and others sent by the Treasury Department to investigate questions bearing upon customs administration shall be accredited to the German Government through the Department of State at Washington and the Foreign Office at Berlin, and such agents shall cooperate with the several chambers of commerce located in the territory apportioned to such agents. It is hereby understood that the general principle as to personce gratoe shall apply to these officials.

F.

The certificates as to value issued by German chambers of commerce shall be accepted by appraisers as competent evidence and be considered by them in connection with such other evidence as may be adduced.

Accept, Excellency, the renewed assurance of my highest consideration.

Elihu Root

Appendix I.

The Secretary of State to the German Ambassador.

Excellency:

Referring to the Commercial Agreement concluded this day between this Government and the Imperial German Government, I have the honor to inform you that the President of the United States authorizes me to state that he will recommend to the Congress the enactment of an amendment of Section 7 of the Customs Administrative Act of June 10, 1890, as amended by Section 32, Act of July 24, 1897, so as to read as follows:

Section 7. That the owner, consignee, or agent of any imported merchandise may, at the time when he shall make and verify his written entry of such merchandise, but not afterwards, make such addition in the entry to or such deductions from the cost or value given in the invoice, or pro forma invoice, or statement in form of an invoice, which he shall produce with his entry, as in his opinion may raise or lower the same to the actual market value or whole [Page 481] sale price of such merchandise at the time of exportation to the United States in the principal markets of the country from which the same has been imported; and the collector within whose district any merchandise may be imported or entered, whether the same has been actually purchased or procured otherwise than by purchase, shall cause the actual market value or wholesale price of such merchandise to be appraised; and if the appraised value of any article of imported merchandise subject to an ad valorem duty or to a duty based upon or regulated in any manner by the value thereof shall exceed the value declared in the entry by more than ten per centum there shall be levied, collected, and paid, in addition to the duties imposed by law on such merchandise, an additional duty of one per centum of the total appraised value thereof for each one per centum in excess of ten per centum that such appraised value exceeds the value declared in the entry, but the additional duties shall only apply to the particular article or articles in each invoice that are so undervalued, and shall not be imposed upon any article upon which the amount of duty imposed by law on account of the appraised value does not exceed the amount of duty that would be imposed if the appraised value did not exceed the entered value, and shall be limited to twenty-five per centum of the appraised value of such article or articles. Such additional duties shall be construed to be penal and within the purview of Sections 5292 and 5293, Revised Statutes, and Sections 17 and 18, Act, June 22, 1874, and further shall be remitted in cases arising from unintentional or manifest clerical error; but these duties shall not be refunded in case of exportation of the merchandise nor shall they be subject to the benefit of drawback: Provided, That if the appraised value of any merchandise shall exceed the value declared in the entry by more than thirty-five per centum, except when arising from an unintentional or a manifest clerical error, such entry shall be held to be presumptively fraudulent, and the collector of customs may seize such merchandise and proceed as in the case of forfeiture for violation of the customs laws; and in any legal proceeding that may result from such seizure the undervaluation as shown by the appraisal shall be presumptive evidence of fraud, and the burden of proof shall be on the claimant to rebut the same, and forfeiture shall be adjudged unless he shall rebut such presumption of fraudulent intent by sufficient evidence. The forfeiture provided for in this section shall only apply to the particular article or articles which are undervalued: Provided, further, That all additional duties, penalties, or forfeitures applicable to merchandise entered by a duly certified invoice shall be alike applicable to merchandise entered by a pro forma invoice or statement in the form of an invoice. The duty shall not, however, be assessed in any case upon an amount less than the entered value.

Accept, Excellency, the renewed assurance of my highest consideration.

Elihu Root.

Appendix II.

[Strike out the words in brackets and insert the words printed in italics.]

Sec. 7. That the owner, consignee, or agent of any imported merchandise [which has been actually purchased] may, at the time when he shall make and verify his written entry of such merchandise, but not afterwards, make such addition in the entry to or such deductions from the cost or value given in the invoice or pro forma invoice or statement in form of an invoice, which he shall produce with his entry, as in his opinion may raise or lower the same to the actual market value or wholesale price of such merchandise at the time of exportation to the United. States, in the principal markets of the [Page 482] country from which the same has been imported; [but no such addition shall be made upon entry to the invoice value of any imported merchandise obtained otherwise than by actual purchase;] and the collector within whose district any merchandise may be imported or entered, whether the same has been actually purchased or procured otherwise than by purchase, shall Cause the actual market value or wholesale price of such merchandise to be appraised; and if the appraised value of any article of imported merchandise subject to an ad valorem duty or to a duty based upon or regulated in any manner by the value thereof shall exceed the value declared in the entry by more than ten per centum there shall be levied, collected, and paid, in addition to the duties imposed by law on such merchandise, an additional duty of one per centum of the total appraised value thereof for each one per centum in excess of ten per centum that such appraised value exceeds the value declared in the entry, but the additional duties shall only apply to the particular article or articles in each invoice that are so undervalued, and shall not be imposed upon any article upon which the amount of duty imposed by law on account of the appraised value does not exceed the amount of duty that would be imposed if the appraised value did not exceed the entered value, and shall be limited to [fifty] twenty-five per centum of the appraised value of such article or articles. Such additional duties shall [not] be construed to be penal, and within the purview of sections 5292 and 5293 Revised Statutes and sections 17 and 18, act, June 22, 1874, and further shall [not] be remitted, [nor payment thereof in any way avoided, except] in cases arising from [a] unintentional or manifest clerical error, [nor shall they be refunded] but these duties shall not be refunded in case of exportation of the merchandise [or on any other account,] nor shall they be subject to the benefit of drawback: Provided, That if the appraised value of any merchandise shall exceed the value declared in the entry by more than [fifty] thirty-five per centum, except when arising from an unintentional or a manifest clerical error, such entry shall be held to be presumptively fraudulent, and the collector of customs [shall] may seize such merchandise and proceed as in case of forfeiture for violation of the customs laws, and in any legal proceeding that may result from such seizure, the undervaluation as shown by the appraisal shall be presumptive evidence of fraud, and the burden of proof shall be on the claimant to rebut the same and forfeiture shall be adjudged unless he shall rebut such presumption of fraudulent intent by sufficient evidence. The forfeiture provided for in this section shall only apply to [the whole of the merchandise or the value thereof in the case or package containing] the particular article or articles [in each invoice] which are undervalued: Provided, further, That all additional duties, penalties or forfeitures applicable to merchandise entered by a duly certified invoice, shall be alike applicable to merchandise entered by a pro forma invoice, or statement in the form of an invoice, [and no forfeiture or disability of any kind, incurred under the provisions of this section shall be remitted or mitigated by the Secretary of the Treasury.] The duty shall not, however, be assessed in any case upon an amount less than the [invoice or] entered value.

[Page 483]

Appendix III.

regulations provided for in the commercial agreement between germany and the united states.

[1907. Department Circular, No. 36. Division of Customs.]

To the Collectors and other Officers of the Customs:

In accordance with the commercial agreement signed April 22, 1907, between the Imperial German Government and the Government of the United States the following regulations, which will remain in force for the term of that agreement, are published for your guidance so far as they relate to your duties.

Market value as defined by section 19 of the customs administrative act shall be construed to mean the export price whenever goods, wares, and merchandise are sold wholly for export, or sold in the home market only in limited quantities, by reason of which facts there can not be established a market value based upon the sale of such goods, wares, and merchandise in usual wholesale quantities, packed ready for shipment to the United States.

Statements provided for in section 8 of the customs administrative act are not to be required by consular officers except upon the request of the appraiser of the port, after entry of the goods. The consular regulations of 1896, paragraph 674, shall be amended accordingly.

In reappraisement cases the hearing shall be open and in the presence of the importer or his attorney, unless the Board of Appraisers shall certify to the Secretary of the Treasury that the public interest will suffer thereby; but in the latter case the importer shall be furnished with a summary of the facts developed at the closed hearing upon which the reappraisement is based.

The practice in regard to “personal appearance before consul,” “original bills,” “declaration of name of ship,” shall be made uniform in the sense—

1.
That the personal appearance before the consular officer shall be demanded only in exceptional cases, where special reasons require a personal explanation.
2.
That the original bills are only to be requested in cases where invoices presented to the consular officer for authentication include goods of various kinds that have been purchased from different manufacturers at places more or less remote from the consulate, and that these bills shall be returned after inspection by the consular officer.
3.
That the declaration of the name of the ship in the invoice shall be dispensed with whenever the exporter at the time the invoice is presented for authentication is unable to name the ship.

Paragraph 678 of such regulations, as amended March 1, 1906, shall be further amended by striking out the words:

“Whenever the invoice is presented to be consulated in a country other than the one from which the merchandise is being directly exported to the United States.”

[Page 484]

And by inserting after the first sentence the following clause:

“As place, in which the merchandise was purchased, is to be considered the place where the contract was made, whenever this was done at the place where the exporter has his office.”

Paragraph 681 of the consular regulations of 1896 relative to “swearing to the invoice” shall be revoked.

Special agents, confidential agents, and others sent by the Treasury Department to investigate questions bearing upon customs administration shall be accredited to the German Government through the Department of State at Washington and the Foreign Office at Berlin, and such agents shall cooperate with the several chambers of commerce located in the territory apportioned to such agents. It is hereby understood that the general principle as to personce gratce shall apply to these officials.

The certificates as to value issued by German chambers of commerce shall be accepted by appraisers as competent evidence and be considered by them in connection with such other evidence as may be adduced.

George B. Cortelyou,
Secretary.

Appendix IV.

executive order.

The Consular Regulations of 1896 are hereby amended as follows: The practice in regard to “personal appearance before consul,” “original bills,” “declaration of name of ship,” shall be made uniform in the sense—

1.
That the personal appearance before the consular officer shall be demanded only in exceptional cases, where special reasons require a personal explanation.
2.
That the original bills are only to be requested in cases where invoices presented to the consular officer for authentication include goods of various kinds that have been purchased from different manufacturers at places more or less remote from the consulate and that these bills shall be returned after inspection by the consular officer.
3.
That the declaration of the name of the ship in the invoice shall be dispensed with whenever the exporter at the time the invoice is presented for authentication is unable to name the ship.

Paragraph 678 of such regulations, as amended March 1, 1906, is further amended by striking out the words:

“Whenever the invoice is presented to be consulated in a country other than the one from which the merchandise is being directly exported to the United States.”

And by inserting after the first sentence the following clause:

“As place, in which the merchandise was purchased, is to be considered the place where the contract was made, whenever this was done at the place where the exporter has his office.”

So that the entire paragraph shall read as follows:

“678. Invoices of merchandise purchased for export to the United States must be produced for certification to the consul of the district [Page 485] at which the merchandise was purchased, or in the district in which it was manufactured, but as a rule consular officers shall not require the personal attendance at his office of the shipper, purchaser, manufacturer, owner, or his agent, for the purpose of making declarations to invoices, but he shall certify invoices sent to him through the mails or by messenger. As place, in which the merchandise was purchased, is to be considered the place where the contract was made, whenever this was done at the place where the exporter has his office. To conform to the statute which requires that merchandise shall be invoiced at the market value or wholesale price of such merchandise as bought and sold in usual wholesale quantities at the time of exportation to the United States, in the principal markets of the country whence imported, consuls will certify to invoices, the additional cost of transportation from the place of manufacture to the place of shipment.”

Paragraph 681 of the Consular Regulations of 1896 relative to “swearing to the invoice” is hereby revoked.

Paragraph 674 of the Consular Regulations of 1896 is amended so that the statements provided for in Section 8 of the Customs Administrative Act are not to be required by consular officers except upon the request of the appraiser of the port, after entry of the goods.

Theodore Roosevelt