HQ 223288: Protest No. 3801-1-101391; Protestability of Requirement for Triennial Report and Fee for Broker Who is Customs Employee; 19 U.S.C. 1514(a)(3) Dear Sir:

Native CBP ruling rendition. Applicability is fact-specific; modification/revocation relationships and original publisher date are retained. Publisher sentinel year0001 means unknown date, not a historical legal adoption.

                            HQ 223288

                       September 12, 1991

BRO-3-05/PRO-2-02-CO:R:C:E 223288 PH

CATEGORY:  Protests

District Director of Customs
Detroit, Michigan 48266

RE:  Protest No. 3801-1-101391; Protestability of Requirement for
     Triennial Report and Fee for Broker Who is Customs Employee;
     19 U.S.C. 1514(a)(3)
 
Dear Sir:

     The above-referenced protest was forwarded to this office
for further review.  We have considered the points raised by your
office and the protestant.  Our decision follows.

FACTS:

     The protestant states that he is an employee of the United
States Customs Service.  He is also a licensed Customs broker. 
He contends that he should not be required to make the triennial
report and pay the $100 fee to accompany that report required by
19 CFR 111.30(d) and 111.96(d), respectively.

     As an alternative, the protestant proposes that, under 19
CFR 111.52, he be allowed to voluntarily offer the suspension of
his license for the duration of his employment by the Customs
Service.  He suggests that while his license is suspended he
should not be required to file the triennial report or to pay the
$100 fee required to accompany that report.  The protestant
proposes that his license be so suspended, that the triennial
report and fee be so waived, and that his payment of the $100 fee
of February 25, 1991, be refunded.  The protestant filed this
protest, under 19 U.S.C. 1514 on May 24, 1991.  The protestant
applied for further review of his protest under 19 CFR 174.24.

ISSUE:

     Are the requirements that a Customs broker must file a
triennial status report under 19 U.S.C. 1641(g)(1) and 19 CFR
111.30(d) and must accompany that report with the fee required in
19 CFR 111.96(d) protestable under 19 U.S.C. 1514?

LAW AND ANALYSIS:

     The statutory authority for protests of Customs decisions is
found in section 514, Tariff Act of 1930, as amended (19 U.S.C.
1514).  Under paragraph (a)(3) of this law, protests may be filed
as to, among other things:  "all charges or exactions of whatever
character within the jurisdiction of the Secretary of the
Treasury."  This is the only item of those listed in 19 U.S.C.
1514(a) which could possibly cover the matter protested in this
case.  This phrase has been the subject of a number of judicial
decisions.  In Puget Sound Freight Lines v. United States, 36
CCPA 70 (C.A.D. 400, 1949), the Court stated:

        We are of the opinion that fees, exactions, or
        charges which bear no relation to the importation
        of merchandise and the rate of duty resulting
        from such classification are not, as contended by
        appellants, "exactions of whatever character
        (within the jurisdiction of the Secretary of the
        Treasury)" within the meaning of [19 U.S.C.
        1514]."  [36 CCPA at 78.]

     Recently, the Court of International Trade interpreted this
phrase with regard to annual fees for Customs bonded warehouses. 
In National Bonded Warehouse Association, Inc. v. United States,
676 F. Supp. 1229, 11 CIT 940 (1987), the Court held that the
fees were charges or exactions within 19 U.S.C. 1514(a)(3),
distinguishing Puget Sound Freight Lines.  Then, on rehearing,
the Court reversed itself, holding that since "the issue of
annual warehouse fees is connected, only tangentially, with the
importation of goods and the liquidation of entries", the issue
is not within the purview of 19 U.S.C. 1514(a) (National Bonded
Warehouse Association, Inc. v. United States, 706 F. Supp. 904,
CIT Slip Op. 89-11, 23 Cust. Bull. & Dec. 9, March 1, 1989, page
50, 53).

     Clearly, the requirement for a triennial status report under
19 U.S.C. 1641(g)(1) is not within any of the decisions listed as
being protestable in 19 U.S.C. 1514(a).  The fee required with
the triennial status fee, under 19 CFR 111.96(d), is no more
connected with the importation of goods and the liquidation of
entries than are the annual warehouse fees.  Therefore, under the
authorities discussed above, particularly the National Bonded
Warehouse Association, Inc. v. United States decisions, we
conclude that these issues may not be protested under 19 U.S.C.
1514.  The protest must be denied.

     For your information, even if the issue under consideration
were protestable, we would deny the protest on the merits.  The
statute governing Customs brokers, section 641, Tariff Act of
1930, as amended (19 U.S.C. 1641) requires each person who is
licensed with a broker's license to file a triennial report as to
"whether such person is actively engaged in business as a customs
broker" (emphasis added) and the name under, and address at,
which such business is conducted.  Since a report is required as
to whether the broker is actively engaged in business as a
customs broker, the clear meaning is that a report is required
even if the broker is not actively so engaged.  The fees for
brokers are provided for in 19 U.S.C. 1641(h).  This is the
authority for the $100 associated with the triennial report,
provided for in 19 CFR 111.96(d).  According to section
111.96(d), the purpose of this fee is to "defray the costs of
administering the reporting requirement."  Since we have no
discretion in requiring the triennial report when a Customs
broker is inactive, and since the fee is required for processing
the fee, we see no substantive grounds for granting the protest.

     Also, for your information, the Office of Trade Operations
has taken a position with regard to the issue raised in this
protest.  It is the position of that Office that the fact that a
Customs employee holds a Customs broker's license does not, in
itself, constitute a conflict of interest.  However, that Office
intends to require each new employee of the Customs Service who
holds a broker's license to request a voluntary suspension of the
license under 19 CFR 111.52.  During the time of suspension, the
employee will be required to file any reports and pay any fees to
keep the license current.  Upon termination of the individual's
employment by the Customs Service, he or she will be able to
reactivate the license without further action.

HOLDING:

     The requirements that a Customs broker must file a triennial
status report under 19 U.S.C. 1641(g)(1) and 19 CFR 111.30(d) and
must accompany that report with the fee required in 19 CFR
111.96(d) are not protestable under 19 U.S.C. 1514.

     The protest is DENIED.  A copy of this decision should be
attached to the Form 19, Notice of Action, to be sent to the
protestant.

                              Sincerely,




                              John Durant, Director