Interpretation ID: 86-3.3

TYPE: INTERPRETATION-NHTSA

DATE: 05/01/86

FROM: AUTHOR UNAVAILABLE; Elizabeth Hanford Dole; NHTSA

TO: William von Raab -- Commissioner of Customs, U.S. Customs Service

TITLE: FMVSS INTERPRETATION

TEXT:

Mr. William von Raab The Commissioner of Customs United States Customs Service 1301 Constitution Avenue, N.W. Washington, D,C. 20229

This responds to your letter suggesting a potential enforcement problem with the new Federal motor vehicle theft prevention standard promulgated by the National Highway Traffic Safety Administration (NHTSA). As you noted, the Customs Service will be the agency responsible for enforcing the provisions in the theft prevention standard requiring subject vehicles and parts to be properly marked and certified before they are imported into the United States. You stated that it was essential that the Customs Service be provided a list of "authorized individuals or companies which have been found by (the Department of Transportation) to possess the capability and integrity to properly certify imported vehicles and parts." Accordingly, you requested that we provide you with such a list. The Department of Transportation does not authorize individuals or companies to engage in the business of importing and modifying vehicles. Therefore, we cannot provide you with a list such as you requested.

This issue arises primarily with respect to "direct importers". These direct importers are individuals and commercial enterprises that obtain foreign cars not originally manufactured for sale in the United States, bring them into this country under bond, and modify the cars so that they can be certified as being in compliance with the U.S. vehicle safety, emissions, and bumper standards. This is commonly referred to as the automotive "gray market". The statutes mandating the Federal safety, emissions, and bumper standards (15 U.S.C. 1397(b)(3), 42 U.S.C. 7522(b)(2), and 15 U.S.C. 1916(b)(3)) explicitly authorize vehicles not in compliance to be brought into this country under bond. However, the Theft Act (15 U.S.C. 2021 et seq.) contains no such provision. Therefore, direct importers must modify all their subject vehicles to comply with the theft prevention standard before the vehicles are imported, and must certify that the vehicles are in compliance at the time of entry.

You stated in your letter that the theft prevention standard could be read to allow any person to certify compliance of an imported vehicle with the standard and that the Customs Service would have no way to judge the authenticity of the certification or the "ability of the party to certify to compliance at the time of importation." You suggested that vehicles and parts could be imported without being properly marked, if Customs had to accept the certification of any person importing such vehicles or parts.

We do not believe that reliance on the importers' certifications will cause the enforcement problems you fear. If subject vehicles or parts bear a certification that complies with the requirements of the theft prevention standard, the Customs Service should allow those vehicles or parts to be imported. NHTSA enforcement personnel will conduct spot checks of the direct importers' vehicles and parts. If we discover that some direct importers are certifying compliance with the theft prevention standard without actually marking in accordance with that standard, we will take appropriate enforcement actions. We expect these actions will help deter any direct importers or other manufacturers who are tempted to falsely certify compliance with the theft prevention standard.

Although we share your concern that all authorized manufacturers and importers of motor vehicles comply with the theft prevention standard, we have no authority to require any person or entity to register with the Department of Transportation and show a capability to comply with the standard before importing a vehicle. We do currently collect information about importers after they have imported a vehicle, as does the Customs Service. However, the fact that a potential importer has not previously imported a vehicle has no legal significance for our enforcement efforts.

I appreciate your concern for the effective enforcement of our theft prevention standard. Please feel free to contact me if you have any further suggestions or ideas in this regard.

Sincerely,

Original Signed By Elizabeth Hanford Dole

Dear Secretary Dole:

I am writing with respect to the recently issued regulations from the National Highway Traffic Safety Administration implementing the Motor Vehicle Theft Law Enforcement Act of 1984, 50 Fed. Reg. 43166 (October 24, 1985). As you may be aware, the Customs Service is developing regulations for the implementation of the export provisions of the Act as it applies to motor vehicle exports. In addition, the Service is also directed to enforce the import restriction set forth in the Act and implemented by the October 24, 1985 Federal Register notice. I want to direct your attention to a potential enforcement problem which has been brought to my attention with respect to the final regulations issued by NHTSA.

The regulations as issued can be read to allow any person to place a certification label for vehicle identification marking on an imported vehicle. If this is the Department of Transportation's interpretation, the Customs Service will have no basis for judging the authenticity of the certification or the ability of the party to certify to compliance at the time of importation. This raises a significant enforcement issue within the Service. If the Service must accept the certification of any person importing a vehicle or parts, these items may in fact be imported without being properly marked in accordance with the statute. If, however, a list of parties who have the ability to certify compliance can be established and utilized by the Customs Service to approve imported vehicles and parts, the Service could, as it does today, spot check the individuals on this list and carefully check for possible exclusion any other importers. We believe, from an enforcement standpoint, to carry out the purposes of the Motor Vehicle Theft Act that it is essential that the Service have a list of authorized individuals or companies which have been found by your Department to possess the capability and integrity to properly certify imported vehicles and parts.

In order to assure effective enforcement of the Act's regulations, I would appreciate receiving a listing identifying those parties who are authorized to certify compliance as soon as possible so we may proceed with our implementation plans and instructions to the field in a timely fashion.

Yours faithfully,

The Honorable Elizabeth Hanford Dole Secretary of Transportation 400 Seventh Street, S.W. Washington, D.C. 20590