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TITLE 34PUBLIC FINANCE
PART 1COMPTROLLER OF PUBLIC ACCOUNTS
CHAPTER 3TAX ADMINISTRATION
SUBCHAPTER OSTATE AND LOCAL SALES AND USE TAXES
RULE §3.360Customs Brokers

(a) Definitions. The following words and terms, when used in this section, shall have the following meanings, unless the context clearly indicates otherwise.

  (1) Authorized employee--A person who is authorized by his employer to perform customs transactions or related services on behalf of the employer, is compensated by the employer with a regular salary or wages, is under the direct control and supervision of the employer, and from whose salary or wages the employer is required to and actually does deduct and withhold a tax under federal law. This definition applies to employees of customs brokers and employees of verification contractors.

  (2) Certification identification number--The number generated by the comptroller's website used to prepare export certification forms as described in subsection (k) of this section.

  (3) Licensed customs broker--A person who is licensed by the United States Customs Service to act as a customs broker and who holds a Texas Customs Broker License issued by the comptroller as provided for in this section.

  (4) Purchaser Identification Number--A number issued by a purchaser's country of residence for purposes of identification. For example, a purchaser from the United Mexican States may have as a purchaser identification number either a "Registro Federal de Contribuyente" or "Registro Federal de Causante" (collectively "RFC"), or a Clave Unica de Registro de la Población (Unique Code to Register the Population or "CURP").

  (5) Total value of property--The sales price, as shown on receipts and invoices, of all property for which a licensed customs broker issued export certification forms during a calendar quarter.

  (6) Total amount of tax on property--The total amount of all Texas state and local sales and use taxes paid on property for which a licensed customs broker issued export certification forms during a calendar quarter.

  (7) Total amount of tax refunded--The total amount of all Texas state and local sales and use taxes that retailers refunded to a customs broker during a calendar quarter.

  (8) Verification contractor--An independent contractor who, for consideration and under a written contract with a licensed customs broker, monitors the export of property on behalf of a licensed customs broker as provided in subsection (b)(1) of this section. Unless the context clearly indicates otherwise, all references in this section to a verification contractor include an authorized employee of a verification contractor.

(b) Certification of exports. Only a licensed customs broker or an authorized employee of a licensed customs broker may fully or partially prepare, issue, and/or sign a valid export certification form as provided for in this section and in §3.323 of this title (relating to Imports and Exports). A retailer who receives documentation that is valid under this section certifying that delivery was made to a point outside of the territorial limits of the United States should refer to §3.323(e) of this title for information regarding refunds. A licensed customs broker, or an authorized employee of the customs broker, may issue an export certification form only if the customs broker or authorized employee:

  (1) personally witnesses, or a verification contractor personally witnesses, the transportation of property across the border of the United States;

  (2) personally witnesses the property being placed on a common carrier for delivery outside the territorial limits of the United States; or

  (3) verifies by performing all of the following actions that the purchaser is transporting the property to a destination outside of the territorial limits of the United States:

    (A) examines a passport, laser visa identification card, or picture foreign voter registration identification that proves that the purchaser of the property resides in a foreign country;

    (B) requires that the documentation examined under subparagraph (A) of this paragraph have a unique purchaser identification number for that purchaser;

    (C) requires that the purchaser produce the property and the original sales receipt for the property so the customs broker or authorized employee can verify that the property is the same property as described in the purchaser's sales receipt. The comptroller shall limit to six the number of receipts for which a single proof of export documentation may be issued under this section;

    (D) requires that the purchaser state the foreign country of destination, which must be the foreign country in which the purchaser resides, the date and time the property is expected to arrive in the foreign country destination, the date and time the property was purchased, the name and address of the retailer from whom the purchaser bought the property, the sales price and quantity of the property, and a description of the property;

    (E) requires that the purchaser and the customs broker or an authorized employee sign in the presence of each other a form prepared or approved by the comptroller:

      (i) that states the purchaser has provided the information and documentation required in this paragraph;

      (ii) that states "Providing false information to a customs broker is a Class B misdemeanor" clearly on the form; and

      (iii) that contains a notice to the purchaser that property not exported to a foreign country is subject to Texas sales and use tax and the purchaser is liable for payment of an amount equal to the value of the property, as well as other possible civil liabilities and criminal penalties, if the purchaser improperly obtains a refund of taxes relating to the property;

    (F) requires that the purchaser produce the following travel documentation for inspection by the customs broker or authorized employee:

      (i) if the purchase was made in a county that does not border the United Mexican States, the purchaser's Form I-94, Arrival/Departure record, or its successor, as issued by the Bureau of Citizenship and Immigration Security of the United States Department of Homeland Security; or

      (ii) if the customs broker is located in a county that does not border the United Mexican States, the purchaser's travel documentation, e.g., airline or bus ticket; and

    (G) requires the purchaser and the customs broker or an authorized employee, when using a power of attorney form to attest, as a part of the form and in the presence of each other:

      (i) that the purchaser has provided the information and documentation required by this paragraph; and

      (ii) that the purchaser is on notice that tangible personal property not exported is subject to taxation under this chapter and the purchaser is liable, in addition to other possible civil liabilities and criminal penalties, for payment of an amount equal to the value of the merchandise if the purchaser improperly obtained a refund of taxes relating to the property;

  (4) circles, and writes or states "exported" next to, each item to be exported on purchaser's original receipt; and

  (5) if the property is verified in accordance with paragraph (3)(C) of this subsection at a time not contemporaneous with the issuance of the certification of export, the customs broker or an authorized employee, in addition to writing or stating "exported" next to each item to be exported on purchaser's original receipt, must write or state on each receipt the date and time the property was verified for export, as well as the full printed name of the person making the verification.

(c) Texas Customs Broker License; prerequisites. A person may apply to the comptroller for a Texas Customs Broker License, which is a license to issue export certification forms for the purpose of claiming exemption from Texas sales and use taxes. To obtain a license, a person must:

  (1) be currently licensed by the United States Customs Service to act as a customs broker;

  (2) submit an application in the form prescribed by the comptroller;

  (3) pay an annual license fee of $300 for each place of business from which the customs broker intends to issue export certification forms;

  (4) post a bond or security as required in subsection (h) of this section; and

  (5) be current in payment of all taxes and fees administered by the comptroller.

(d) Form of application. The comptroller will prescribe an application form for a Texas Customs Broker License, which must include or be accompanied by the following:

  (1) a copy of the applicant's license to act as a customs broker issued by the United States Customs Service;

  (2) the applicant's name, mailing address, primary business address, business telephone number, home address, and home telephone number, and the names, home addresses, and home telephone numbers of all the general partners (if the applicant is a partnership), the formation/registration number, formation/registration date, federal Employer Identification Number, and the names, home addresses, and home telephone numbers of the officers and directors (if the applicant is a corporation), or the names, home addresses, and home telephone numbers of the members (if the applicant is an entity other than a partnership or corporation);

  (3) the names, mailing addresses, primary business addresses, business telephone numbers, home addresses, and home telephone numbers of all verification contractors and all authorized employees of verification contractors, and the names, home addresses, and home telephone numbers of all the general partners (if the verification contractor is a partnership), the formation/registration number, formation/registration date, federal Employer Identification Number, and the names, home addresses, and home telephone numbers of the officers and directors (if the verification contractor is a corporation), or the names, home addresses, and home telephone numbers of the members (if the verification contractor is an entity other than a partnership or corporation), and the date of contract of all verification contractors;

  (4) the names, home addresses, and home telephone numbers of all employees who are authorized to certify exports in the name of the applicant and the date of hire of all such employees;

  (5) a copy of each authorized employee's power of attorney to certify exports in the name of the applicant;

  (6) the trade name of the applicant's business and the address of each location where export certifications are to be fully or partially prepared;

  (7) the original signature or signatures of the applicant (if the applicant is a sole proprietor), an officer or director (if the applicant is a corporation), all general partners (if the applicant is a partnership), or an authorized member (if the applicant is an entity other than a corporation or partnership), and the original signatures of all authorized employees of the customs broker;

  (8) the social security number of each authorized employee, verification contractor, and authorized employee of a verification contractor, and the social security number of the applicant (if the applicant is a sole proprietor), each general partner (if the applicant is a partnership), each officer and director (if the applicant is a corporation), or each member (if the applicant is an entity other than a partnership or corporation); and

  (9) any other information the comptroller requires.

(e) Annual customs broker license and fee. An annual customs brokers license issued under this section continues in effect through December 31st each year unless canceled by the customs broker or suspended or revoked by the comptroller before the expiration date. All expired, canceled, suspended, or revoked licenses must be immediately returned to the comptroller or they will be subject to confiscation. The annual license fee is non-refundable but the fee may be prorated on a $75 per-quarter basis as follows:

  (1) $300 fee for a license with an effective date beginning January 1st through March 31st.

  (2) $225 fee for a license with an effective date beginning April 1st through June 30th.

  (3) $150 fee for a license with an effective date beginning July 1st through September 30th.

  (4) $75 fee for a license with an effective date beginning October 1st through December 31st of a calendar year.

(f) Display of license. An original Texas Customs Broker License must be prominently displayed at each place of business of the customs broker where export certification forms are fully or partially prepared.

(g) Locations outside the United States. No Texas Customs Broker Licenses will be issued for locations beyond the territorial limits of the State of Texas.

(h) Bond or security. A licensed customs broker is required to post a bond or security in the amount of $5,000, plus an additional $1,000 for each place of business from which the customs broker intends to issue export certification forms.

  (1) The security may be in the form of cash, a certificate of deposit, a letter of credit, or another instrument of value acceptable as security to the comptroller.

  (2) The comptroller may forfeit a customs broker's bond or security and apply the amount to any liabilities due for unpaid taxes, penalties, interest, license fees, stamp fees, and other penalties imposed for any violations of the Tax Code or this section.

Cont'd...

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