BRO-4-02-CO:R:C:E 222743 JR
M. Barry Levy, Esquire
Sharretts, Paley, Carter & Blauvelt, P.C.
67 Broad Street
New York, New York 10004
RE: Powers of Attorney retained by customhouse broker; Facsimile
("faxes") Powers of Attorney; Brokers; 19 CFR 141.46
Dear Mr. Levy:
This is in response to your ruling request dated October 10,
1990, on behalf of your client, N.J. Defonte Co., Inc., a
licensed customhouse broker on the above-reference subject.
FACTS:
Your client, a licensed customhouse broker, is frequently
contacted by importers who wish him to take immediate action on
their behalf regarding certain Customs transactions. The broker
advises such an importer that, in accordance with section 141.46,
Customs Regulations (19 CFR 141.46), a broker must obtain a power
of attorney from an importer prior to transacting Customs
business in the importer's name. Some importers have suggested
executing a power of attorney in favor of the broker and, in the
interest of time, sending it to him by facsimile, or fax,
machine. However, the broker has been insisting on receiving the
executed document itself prior to taking any action, which
frequently causes costly delays. Accordingly, your broker client
seeks authorization to transact Customs business under the
authority of a "faxed" power of attorney.
ISSUE:
Does a customhouse broker satisfy the regulatory requirement
to retain powers of attorney under 19 CFR 141.46 by keeping
"faxes" of the original powers of attorney transmitted to him by
importer-clients?
LAW AND ANALYSIS:
A customhouse broker is required to have a valid power of
attorney in the name of his principal in order to transact
Customs business. 19 CFR 141.46. Section 141.46, CR, further
provides that the broker need not file it with the district
director, but must retain powers of attorney with his (the
broker's) books and papers so that it can be made available to
Customs officers as provided in Subpart C, Part 111, Customs
Regulations (Duties and Responsibilities of Customs Brokers).
Section 111.23(d), entitled "Other methods of reproduction
for record retention" states:
If approved by the district director in which a broker has
been granted a permit and in which he has records located, a
broker may use, in lieu of original documents, methods of
reproduction other than microfilm, including microfiche, for
the reproduction of records, provided the requirements of
paragraph (b) and (c) of this section is met. While
original powers of attorney must be retained, copies also
may be retained. (Emphasis added.)
19 CFR 111.23(d).
Your position is that a literal reading of the first clause
of the last sentence quoted above suggests that brokers must
always possess the originally executed power of attorney;
however, such an interpretation would render the second clause of
that sentence superfluous, for there would be no purpose to
giving a broker permission to retain a copy of a document which
he must have in his possession anyway.
We agree with your interpretation of the last sentence of 19
CFR 111.23(d). Having on file a "hard" faxed copy of the
original executed power of attorney, the broker satisfies the
requirement of retaining a valid power of attorney under 19 CFR
111.23(d).
Customs has upheld the use of facsimile signature on
computer-generated entry forms. See T.D. 78-317 (holding that a
facsimile signature may be used on a transportation entry);
C.S.D. 79-94 (holding that a Customs bond may be executed by
means of a facsimile signature and discussing the general
question of the meaning of "to sign" or "signature" at some
length), C.S.D. 79-363 (holding that facsimile signature are
acceptable for the certification of a Notice of Exportation), and
Headquarter Ruling 219147 dated December 5, 1986 (stating that
facsimile signature may be used on entry documentation).
The Customs Service is moving in the direction of
"paperless" or electronic entry filing and treating
electronically transmitted "writings" the same as traditional
written documents (see "Proposed Customs Regulations Regarding
Electronic Entry Filing" at 55 FR 2528, January 25, 1990, and
24 Cust. B. & Dec., No. 6, at p.15-30, February 7, 1990).
Although we view a "faxed" power of attorney as a valid
document, we render no opinion as to its admissibility or
sufficiency in a court of law. See 80 C.J.S., Signatures,
section 7. A prudent broker, therefore, may want to protect
himself against challenges to his authority by the importer-
client, regarding the authenticity or genuineness of the
document, by having the importer-client follow-up the
transmission of the fax with the original executed power of
attorney for his (the broker's) file. This, however, is strictly
a matter between the private parties, the broker and importer, in
which Customs would not get involved. Moreover, we note that the
benefit of Appendix B to Part 171, Customs Regulations, namely
paragraph (I) pertaining to Customhouse Brokers, might not be
available to a broker whose "principal" (the importer-client)
denies the existence of a "principal-agent" relationship with
him.
Upon receipt of the fax, the broker can begin transacting
Customs business since a power of attorney does, in fact, exist
even though the broker has in his possession the facsimile, which
we find to be a valid and binding instrument for purposes of
transacting Customs business.
In summary, a broker may satisfy the requirements of 19 CFR
141.46 by retaining "faxed" powers of attorneys from his
importer-clients for instant access provided that he can produce
the original executed power of attorney from his client to
Customs, if necessary, within a reasonable time.
HOLDING:
A customhouse broker may satisfy the requirement of 19 CFR
141.46 to retain powers of attorney by keeping "faxes" of the
original powers of attorney transmitted to him by importer-
clients provided that the original document can be produced if
necessary to Customs within a reasonable period of time.
Sincerely,
John Durant, Director