Federal Regulation

Office of the Secretary, USDA

§ 6.3

in the method of computing the parity
price of such commodity. Such determination by the Secretary shall be
final. The Secretary’s determination
shall be filed with the Hearing Clerk
who shall cause the determination to
be published promptly in the FEDERAL
REGISTER. The Hearing Clerk shall also
mail a copy of the determination to
each producer and grower organization
which participated in or is known to be
interested in the hearing. Upon application to the Hearing Clerk, any person shall be entitled to a copy of the
determination.
[23 FR 9252, Nov. 29, 1958]

PART 6—IMPORT QUOTAS AND
FEES
Subpart—General Provisions
Sec.
6.2 Responsibility for actions under section
22 and section 8(a).
6.3 Requests by interested persons for action by Department of Agriculture.
6.4 Investigations.
6.5 Hearings under section 22.
6.6 Submission of recommendations under
section 22.
6.7 Submission of recommendations under
section 8(a) (emergency treatment).
6.8 Representation at Tariff Commission
hearings.
6.9 Information.

Subpart—Dairy Tariff-Rate Quota Import
Licensing
6.20 Introduction.
6.21 Definitions.
6.22 Requirement for a license.
6.23 Eligibility to apply for a license.
6.24 Application for a license.
6.25 Allocation of licenses.
6.26 Surrender and reallocation.
6.27 Limitations on use of license.
6.28 Transfer of license.
6.29 Use of licenses.
6.30 Record maintenance and inspection.
6.31 Debarment and suspension.
6.32 Globalization of licenses.
6.33 License fee.
6.34 Adjustment of Appendices.
6.35 Correction of errors.
6.36 Miscellaneous.

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Subpart—Price-Undercutting of Domestic
Cheese by Quota Cheeses
6.40
6.41
6.42

General.
Definitions.
Complaints of price-undercutting.

6.43
6.44

Determinations.
Delegation of authority.

CROSS REFERENCE: For United States International Trade Commission regulations on
investigations of effects of imports on agricultural programs, see 19 CFR part 204.

Subpart—General Provisions
AUTHORITY: Sec. 8, 65 Stat. 75; 19 U.S.C.
1365.
SOURCE: 17 FR 8287, Sept. 16, 1952; 19 FR 57,
Jan. 6, 1954, unless otherwise noted.

§ 6.2 Responsibility for actions under
section 22 and section 8(a).
The primary responsibility within
the Department of Agriculture for action on matters for which the Secretary is responsible under section 22 of
the Agricultural Adjustment Act of
1933, as amended, and section 8(a) of
the Trade Agreements Extension Act of
1951 is assigned to the Administrator,
Foreign Agricultural Service (referred
to in this part as the ‘‘Administrator’’), but the other offices, agencies, and bureaus of the Department
whose activities will be affected by any
action under section 22 or section 8(a)
shall be consulted by the Administrator in discharging his responsibility
under this part.
§ 6.3 Requests by interested persons
for action by Department of Agriculture.
(a) Section 22. A request for action
under section 22 should be submitted in
duplicate to the Administrator, Foreign Agricultural Service, United
States Department of Agriculture,
Washington 25, D.C. Such request shall
include a statement of the reasons why
action would be warranted under section 22 and shall be supported by appropriate information and data.
(b) Section 8(a). A request for action
under section 8(a) should be submitted
in duplicate to the Administrator, Foreign Agricultural Service, United
States Department of Agriculture,
Washington 25, D.C. Such request shall
include a statement of the reasons why
the commodity is perishable, and why,
due to such perishability, a condition
exists requiring emergency treatment,
and shall be supported by appropriate
information and data. A request under

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§ 6.4

7 CFR Subtitle A (1–1–16 Edition)

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section 8(a) submitted in connection
with a proposed section 7 (Trade Agreements Extension Act of 1951) investigation shall not be acted upon until a
section 7 application has been properly
filed by the person making the request
with the Tariff Commission, and a copy
of such application and supporting information and data are furnished the
Administrator.
§ 6.4 Investigations.
(a) Section 22. The Administrator
shall cause an investigation to be made
whenever, based upon a request submitted pursuant to § 6.3 or upon other
information available to him, he determines that there is reasonable ground
to believe that the imposition of import quotas or fees under section 22
may be warranted, or that the termination or modification of import
quotas or fees in effect under section 22
may be warranted.
(b) Section 8(a). The Administrator
shall cause an immediate investigation
to be made whenever (1) a request is received for emergency treatment in connection with an application properly
filed with the Tariff Commission under
section 7; (2) a request is received for
emergency treatment under section 22
if the Administrator determines that
there is reasonable ground to believe
that the imposition of import quotas or
fees under section 22 may be warranted; or (3) the Administrator, upon
the basis of other information available to him, has reasonable ground for
believing that emergency treatment
under section 8(a) is necessary. The Administrator shall expedite to the fullest practicable extent his attention to
requests for emergency treatment
under section 8(a), and such requests
shall receive priority over requests for
other action under section 22. The investigation shall cover (1) whether the
commodity is a perishable agricultural
commodity; (2) whether, due to the perishability of the commodity, a condition exists requiring emergency treatment as indicated by such factors as (i)
the marketing season for the commodity, (ii) past and prospective domestic production, stocks, requirements, and prices, (iii) past and prospective imports; and (3) such other
matters as the Administrator deter-

mines are relevant to a determination
as to whether emergency treatment for
the commodity is necessary. No public
hearing shall be held in connection
with investigations under this paragraph.
§ 6.5

Hearings under section 22.

The Administrator is authorized to
provide for such public hearings as he
deems necessary to discharge the responsibility for action under section 22
vested in him by §§ 6.2 and 6.4(a). In
view of the need, however, for prompt
action on requests for action under section 22, public hearings shall be held in
connection with investigations conducted under § 6.4(a) only when the Administrator determines that a public
hearing is necessary to obtain supplementary information not otherwise
available. Any public hearing which is
held shall be conducted by representatives designated for the purpose by the
Administrator; shall be preceded by
such public notice as, in the opinion of
the Administrator, will afford interested persons reasonable opportunity
to attend and present information; and
minutes of the proceedings at such
hearing shall be obtained. Hearings
shall be informal and technical rules of
evidence shall not apply. Such hearings
are for the purpose of obtaining information for the assistance of the Secretary. However, in discharging his responsibilities under section 22, the Secretary is not restricted to the information adduced at the hearings.
§ 6.6 Submission of recommendations
under section 22.
(a) The Administrator shall make a
report to the Secretary upon the completion of each investigation made by
him pursuant to § 6.4(a). The report
shall summarize the information disclosed by the investigation; shall contain the recommendations of the Administrator; and, in case action under
section 22 is recommended, shall be accompanied by a suggested letter from
the Secretary to the President recommending that the Tariff Commission be
directed to conduct an investigation.
Such report shall be submitted to the
other offices, agencies, and bureaus of
the Department of Agriculture whose

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Office of the Secretary, USDA

§ 6.9

activities would be affected, for concurrence or comment.
(b) The Secretary will recommend
that the President direct the Tariff
Commission to conduct an investigation under section 22 only if he has reason to believe, upon the basis of the information available to him, that import quotas or fees should be imposed.

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§ 6.7 Submission of recommendations
under section 8(a) (emergency
treatment).
(a) Section 22. The Administrator’s report submitted pursuant to § 6.6 shall
indicate whether or not emergency
treatment is necessary. If emergency
treatment is recommended, the report
shall discuss the condition which requires emergency treatment and be accompanied by suggested letters from
the Secretary to the President, to the
Tariff Commission, and to the petitioner (if any) advising them of the
Secretary’s determination. The suggested letter from the Secretary to the
President shall include a recommendation as to whether such emergency
treatment should take the form of action by the President prior to receiving
the recommendations of the Tariff
Commission, or whether a decision by
the President may appropriately be
withheld until the recommendations of
the Tariff Commission are received. If
emergency treatment requested is not
recommended, the report to the Secretary shall be accompanied by suggested letters from the Secretary to
the petitioner and the Tariff Commission stating the action taken.
(b) Section 7. The Administrator shall
make a report to the Secretary upon
the completion of each investigation
made by him pursuant to § 6.4(b). The
report shall summarize the information disclosed by the investigation, including the points listed in § 6.4(b)
which were considered in reaching the
recommendation, and shall contain the
recommendations of the Administrator
as to whether or not emergency treatment is required. If emergency treatment is recommended, the report shall
discuss the condition which requires
emergency treatment and shall be accompanied by suggested letters from
the Secretary to the President, to the
Tariff Commission, and to the peti-

tioner advising them of the Secretary’s
determination. The suggested letter
from the Secretary to the President
shall include a recommendation as to
whether such emergency treatment
should take the form of action by the
President prior to receiving the recommendations of the Tariff Commission, or whether a decision by the
President may appropriately be withheld until the recommendations of the
Tariff Commission are received. If
emergency treatment is not recommended, the report to the Secretary
shall be accompanied by suggested letters from the Secretary to the petitioner and to the Tariff Commission
stating the action taken. Each such report shall be submitted to the other offices, agencies, and bureaus of the Department of Agriculture whose activities would be affected, for concurrence
or comment.
§ 6.8 Representation at Tariff Commission hearings.
The Department of Agriculture shall
be represented at all hearings conducted by the Tariff Commission under
section 22 by persons designated by the
Administrator, assisted by a representative of the Office of the General Counsel. Such representatives shall present
the recommendations of the Department of Agriculture, shall submit such
information and data in support thereof as are available, and shall exercise
the right of examining other witnesses
which is granted to the Secretary.
[17 FR 8287, Sept. 16, 1952; 20 FR 1830, Mar. 25,
1955]

§ 6.9 Information.
Persons desiring information from
the Department of Agriculture regarding section 22 or section 8(a), or any action with respect thereto, should address such inquiries to the Administrator, Foreign Agricultural Service,
United States Department of Agriculture, Washington 25, DC.

Subpart—Dairy Tariff-Rate Quota
Import Licensing
AUTHORITY: Additional U.S. Notes 6, 7, 8,
12, 14, 16–23 and 25 to Chapter 4 and General
Note 15 of the Harmonized Tariff Schedule of
the United States (19 U.S.C. 1202), Pub. L. 97–

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§ 6.20

7 CFR Subtitle A (1–1–16 Edition)

258, 96 Stat. 1051, as amended (31 U.S.C. 9701),
and secs. 103 and 404, Pub. L. 103–465, 108
Stat. 4819 (19 U.S.C. 3513 and 3601).
SOURCE: 61 FR 53007, Oct. 9, 1996, unless
otherwise noted.

§ 6.20

Introduction.

(a) Presidential Proclamation 6763 of
December 23, 1994, modified the Harmonized Tariff Schedule of the United
States affecting the import regime for
certain articles of dairy products. The
Proclamation terminated quantitative
restrictions that had been imposed pursuant to section 22 of the Agricultural
Adjustment Act of 1933, as amended (7
U.S.C. 624); proclaimed tariff-rate
quotas for such articles pursuant to
Public Law 103–465; and specified which
of such articles may be entered only by
or for the account of a person to whom
a license has been issued by the Secretary of Agriculture.
(b) Effective January 1, 1995, the
prior regime of absolute quotas for certain dairy products was replaced by a
system of tariff-rate quotas. The articles subject to licensing under the tariff-rate quotas are listed in Appendices
1, 2, and 3 to be published annually in
a notice in the FEDERAL REGISTER. Licenses permit the holder to import
specified quantities of the subject articles into the United States at the applicable in-quota rate of duty. If an importer has no license for an article subject to licensing, such importer will,
with certain exceptions, be required to
pay the applicable over-quota rate of
duty.
(c) The Secretary of Agriculture has
determined that this subpart will, to
the fullest extent practicable, result in
fair and equitable allocation of the
right to import articles subject to such
tariff-rate quotas. The subpart will
also maximize utilization of the tariffrate quotas for such articles, taking
due account of any special factors
which may have affected or may be affecting the trade in the articles concerned.
[80 FR 44254, July 27, 2015]

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§ 6.21

Definitions.

As used in this subpart and the appendices thereto, the following terms
are defined as follows:

Article. One of the products listed in
Appendices 1, 2, or 3, which are the
same as those described in Additional
U.S. Notes 6, 7, 8, 12, 14, 16–23 and 25 to
Chapter 4 of the Harmonized Tariff
Schedule.
Article other than cheese or cheese
products. Any article that is a dairy
product, but not a cheese or cheese
product.
CBP. United States Customs and Border Protection, U.S. Department of
Homeland Security.
Cheese or cheese products. Articles in
headings 0406, 1901.90.34, and 1901.90.36
of the Harmonized Tariff Schedule.
Commercial entry. Any entry except
those made by or for the account of the
United States Government or for a foreign government, for the personal use
of the importer or for sampling, taking
orders, research, or the testing of
equipment.
Country. Country of origin as determined in accordance with CBP rules
and regulations, except that ‘‘EC’’, and
‘‘Other countries’’ shall each be treated
as a country.
DAIRIES. The ‘‘Dairy Accelerated
Importer Retrieval and Information
Exchange System’’. The web-based user
interface system which persons must
utilize to apply for and manage licenses, and through which the Licensing Authority will communicate all
program notices.
Dairy products. Articles in headings
0401 through 0406, margarine cheese
listed under headings 1901.90.34 and
1901.90.36, ice cream listed under heading 2105, and casein listed under heading 3501 of the Harmonized Tariff
Schedule.
Department. The United States Department of Agriculture.
EC. Those countries listed in Additional U.S. Note 2 to Chapter 4 of the
Harmonized Tariff Schedule.
Enter or Entry. To make or making
entry for consumption, or withdrawal
from warehouse for consumption in accordance with CBP regulations and
procedures.
Harmonized Tariff Schedule or HTS.
The Harmonized Tariff Schedule of the
United States.
Licensee. A person to whom a license
has been issued under this subpart.

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Office of the Secretary, USDA

§ 6.23

Licensing Authority. Any officer or
employee of the U.S. Department of
Agriculture designated to act in this
position by the Director of the Division
charged with managing the Dairy Tariff-Rate Quota Import Licensing System.
Other countries. Countries not listed
by name as having separate tariff-rate
quota allocations for an article.
Person. An individual, firm, corporation, partnership, association, trust,
estate or other legal entity.
Process or processing. Any additional
preparation of a dairy product, such as
melting, grating, shredding, cutting
and wrapping, or blending with any additional ingredient.
Quota year. The 12-month period beginning on January 1 of a given year.
Tariff-rate quota amount or TRQ
amount. The amount of an article subject to the applicable in-quota rate of
duty established under a tariff-rate
quota.
United States. The customs territory
of the United States, which is limited
to the 50 states, the District of Columbia, and Puerto Rico.
[80 FR 44254, July 27, 2015]

§ 6.22 Requirement for a license.
A person who seeks to enter, or cause
to be entered an article as a commercial entry, shall obtain a license, in accordance with this subpart.

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[80 FR 44254, July 27, 2015]

§ 6.23 Eligibility to apply for a license.
(a) In general. To apply for any license, a person shall have:
(1) A business office, and be doing
business, in the United States, and
(2) An agent in the United States for
service of process, and
(3) An email address to be used for
correspondence regarding licensing activities and reports.
The licensee is responsible to continuously maintain a valid email address in DAIRIES for use in communicating with the Licensing Authority.
(b) Eligibility for 2016 and subsequent
quota years. (1) Historical licenses (Appendix 1). A person issued a historical
license for an article for the current
quota year may apply for a historical
license (Appendix 1) for the next quota

year for the same article from the
same country, if such person was, during the 12-month period ending August
31 prior to the quota year, either:
(i) Where the article is cheese or
cheese product,
(A) The owner of and importer of
record for at least three separate commercial entries of cheese or cheese
products totaling not less than 57,000
kilograms net weight, each of the three
entries not less than 2,000 kilograms
net weight;
(B) The owner of and importer of
record for at least eight separate commercial entries of cheese or cheese
products, from at least eight separate
shipments, totaling not less than 19,000
kilograms net weight, each of the eight
entries not less than 450 kilograms net
weight, with a minimum of two entries
in each of at least three quarters during that period; or
(C) The owner or operator of a plant
listed in Section II or listed in Section
I as a processor of cheese of the most
current issue of ‘‘Dairy Plants Surveyed and Approved for USDA Grading
Service’’ and had processed or packaged at least 450,000 kilograms of
cheese or cheese products in its own
plant in the United States; or
(ii) Where the article is not cheese or
cheese product,
(A) The owner of and importer of
record for at least three separate commercial entries of dairy products totaling not less than 57,000 kilograms net
weight, each of the three entries not
less than 2,000 kilograms net weight;
(B) The owner of and importer of
record for at least eight separate commercial entries of dairy products, from
at least eight separate shipments, totaling not less than 19,000 kilograms
net weight, each of the eight entries
not less than 450 kilograms net weight,
with a minimum of two entries in each
of at least three quarters during that
period;
(C) The owner or operator of a plant
listed in the most current issue of
‘‘Dairy Plants Surveyed and Approved
for USDA Grading Service’’ and had
manufactured, processed or packaged
at least 450,000 kilograms of dairy products in its own plant in the United
States; or

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§ 6.23

7 CFR Subtitle A (1–1–16 Edition)

(D) The exporter of dairy products in
the quantities and number of shipments required under (A) or (B) above.
(2) Nonhistorical licenses for cheese
or cheese products (Appendix 2). A person may annually apply for a nonhistorical license for cheese or cheese
products (Appendix 2) if such person
meets the requirements of paragraph
(b)(1)(i) of this section.
(3) Nonhistorical licenses for articles
other than cheese or cheese products
(Appendix 2). A person may annually
apply for a nonhistorical license for articles other than cheese or cheese products (Appendix 2) if such person meets
the requirements of paragraph (b)(1)(ii)
of this section.
(4) Designated license (Appendix 3). A
designated license may be issued to a
person who has applied for a license,
has met the requirements of paragraph
(b)(1)(i) of this section, and is designated by the government of a country for such license according to
§ 6.25(d).
(c) Exceptions. (1) A licensee that fails
in a quota year to enter at least 85 percent of the amount of an article permitted under a license shall not be eligible to receive a license for the same
article from the same country for the
next quota year. For the purpose of
this paragraph, the amount of an article permitted under the license will exclude any amounts surrendered pursuant to § 6.26(a), but will include any additional allocations received pursuant
to § 6.26(b).
(2) Paragraph (c)(1) of this section
will not apply where the licensee demonstrates to the satisfaction of the Licensing Authority that the failure resulted from breach by a carrier of its
contract of carriage, breach by a supplier of its contract to supply the article, act of God or force majeure.
(3) Paragraph (c)(1) of this section
may not apply in the case of historical
or nonhistorical licenses, where the licensee demonstrates to the satisfaction
of the Licensing Authority that the
country specified on the license maintains or permits an export monopoly to
control the dairy articles concerned
and the licensee petitions the Licensing Authority to waive this requirement. The licensee shall submit evidence that the country maintains an

export monopoly as defined in this
paragraph. For the purposes of this
paragraph ‘‘export monopoly’’ means a
privilege vested in one or more persons
consisting of the exclusive right to
carry on the exportation of any article
of dairy products from a country to the
United States.
(4) The Licensing Authority will not
issue a nonhistorical license (Appendix
2) for an article from a country during
a quota year to an applicant who is affiliated with another applicant to
whom the Licensing Authority is
issuing a non-historical license for the
same article from the same country for
that quota year. Further, the Licensing Authority will not issue a nonhistorical license for butter to an applicant who is affiliated with another
applicant to whom the Licensing Authority is issuing a historical butter license of 57,000 kilograms or greater.
For the purpose of this paragraph, an
applicant will be deemed affiliated
with another applicant if:
(i) The applicant is the spouse, brother, sister, parent, child or grandchild of
such other applicant;
(ii) The applicant is the spouse,
brother, sister, parent, child or grandchild of an individual who owns or controls such other applicant;
(iii) The applicant is owned or controlled by the spouse, brother, sister,
parent, child or grandchild of an individual who owns or controls such other
applicant.
(iv) Both applicants are 5 percent or
more owned or directly or indirectly
controlled, by the same person;
(v) The applicant, or a person who
owns or controls the applicant, benefits
from a trust that controls such other
applicant.
(5) The Licensing Authority will not
issue a nonhistorical license (Appendix
2) for an article from a country during
a quota year to an applicant who is associated with another applicant to
whom the Licensing Authority is
issuing a nonhistorical license for the
same article from the same country for
that quota year. Further, the Licensing Authority will not issue a nonhistorical license for butter to an applicant who is associated with another

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Office of the Secretary, USDA

§ 6.25

applicant to whom the Licensing Authority is issuing a historical butter license for 57,000 kilograms or greater.
For the purpose of this paragraph, an
applicant will be deemed associated
with another applicant if:
(i) The applicant is an employee of,
or is controlled by an employee of,
such other applicant;
(ii) The applicant manages or is managed by such other applicant, or economically benefits, directly or indirectly, from the use of the license
issued to such other applicant.
(6) The Licensing Authority will not
issue a nonhistorical license for an article from a country during a quota
year, for which the applicant receives a
designated license.

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[80 FR 44254, July 27, 2015]

§ 6.24 Application for a license.
(a) Application for license shall be
made on electronic forms designated
for the purpose by the Licensing Authority. All parts of the application
shall be completed. The application
shall be transmitted no earlier than
September 1 and no later than midnight October 15 of the year preceding
that for which license application is
made. The Licensing Authority will
not accept incomplete applications.
(b)(1) Where the applicant seeks to
establish eligibility on the basis of imports, applications shall include identification of entries sufficient to establish the applicant as the importer of
record of entries required under § 6.23,
during the 12-month period ending August 31 prior to the quota year for
which license is being sought. For
qualifying licensed entries, verification
will
be
only
processed
through
DAIRIES and cross checked with entries in the CBP system. For qualifying
unlicensed entries, the applicant will
submit an electronic copy (e.g. scanned
PDF) of CBP Form 7501 to the Licensing Authority.
(2) Where the applicant seeks to establish eligibility on the basis of exports, applications shall include:
(i) Census Form 7525 or a copy of the
electronic submission of such form, and
(ii) The commercial invoice or bill of
sale for the quantities and number of
export shipments required under § 6.23,
during the 12-month period ending Au-

gust 31 prior to the quota year for
which license is being sought.
(c) An applicant requesting more
than one nonhistorical license must
rank order these requests by the applicable Additional U.S. Note number.
Cheese and cheese products must be
ranked separately from dairy articles
other than cheese or cheese products.
[80 FR 44254, July 27, 2015]

§ 6.25

Allocation of licenses.

(a) Licensing Authority. The Licensing
Authority will issue historical, nonhistorical and designated licenses.
(b) Historical licenses for the 2016 and
subsequent quota years (Appendix 1). A
person issued a historical license for
the current quota year will be issued a
historical license in the same amount
for the same article from the same
country for the next quota year except
that beginning with the 2023 quota
year, a person who has surrendered
more than 50 percent of such historical
license in at least three of the prior 5
quota years will thereafter be issued a
license in an amount equal to the average annual quantity entered during
those 5 quota years.
(c) Nonhistorical licenses (Appendix 2).
The Licensing Authority will allocate
nonhistorical licenses on the basis of a
rank-order lottery system, which will
operate as follows:
(1) The minimum license size shall
be:
(i) Where the article is cheese or
cheese product:
(A) The total amount available for
nonhistorical
license
where
such
amount is less than 9,500 kilograms;
(B) 9,500 kilograms where the total
amount available for nonhistorical license is between 9,500 kilograms and
500,000 kilograms, inclusive;
(C) 19,000 kilograms where the total
amount available for nonhistorical license is between 500,001 kilograms and
1,000,000 kilograms, inclusive;
(D) 38,000 kilograms where the total
amount available for nonhistorical license is greater than 1,000,000 kilograms; or
(E) An amount less than the minimum license size established in paragraphs (c)(1)(i) (A) through (D) of this
section, if requested by the licensee;

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§ 6.26

7 CFR Subtitle A (1–1–16 Edition)

(ii) Where the article is not cheese or
cheese product:
(A) The total amount available for
nonhistorical
license
where
such
amount is less than 19,000 kilograms;
(B) 19,000 kilograms where the total
amount available for nonhistorical license is between 19,000 kilograms and
550,000 kilograms, inclusive;
(C) 38,000 kilograms where the total
amount available for nonhistorical license is between 550,001 kilograms and
1,000,000 kilograms, inclusive; and
(D) 57,000 kilograms where the total
amount available for nonhistorical license is greater than 1,000,000 kilograms;
(E) An amount less than the minimum license sizes established in paragraphs (c)(1)(i)(A) through (D) of this
section, if requested by the licensee.
(2) Taking into account the order of
preference expressed by each applicant,
as required by § 6.24(c), the Licensing
Authority will allocate licenses for an
article from a country by a series of
random draws. A license of minimum
size will be issued to each applicant in
the order established by such draws
until the total amount of such article
in Appendix 2 has been allocated. An
applicant that receives a license for an
article will be removed from the pool
for subsequent draws until every applicant has been allocated at least one license, provided that the licenses for
which they applied are not already
fully allocated. Any amount remaining
after the random draws which is less
than the applicable minimum license
size may, at the discretion of the licensing Authority, be prorated equally
among the licenses awarded for that
article.
(d) Designated licenses (Appendix 3). (1)
With respect to an article listed in Appendix 3, the government of the applicable country may, not later than October 31 prior to the beginning of a
quota year, submit directly by email to
the Licensing Authority:
(i) The names, addresses and emails
of the importers that it is designating
to receive licenses; and
(ii) The amount, in kilograms, of
such article for which each such importer is being designated. Where quantities for designation result from both
Tokyo Round concessions and Uruguay

Round concessions, the designations
should be made in terms of each.
(2) To the extent practicable, the Licensing Authority will issue designated
licenses to those importers, and in
those amounts, indicated by the government of the applicable country, provided that the importer designated
meets the eligibility requirements set
forth in § 6.23. Consistent with the
international obligations of the United
States, the Licensing Authority may
disregard a designation if the Licensing
Authority determines that the person
designated is not eligible for any of the
reasons set forth in § 6.23(c)(1) or (2).
(3) If a government of a country
which negotiated in the Uruguay
Round for the right to designate importers has not done so, but determines
to designate importers for the next
quota year, it shall indicate its intention to do so directly and in writing to
the Licensing Authority not later than
July 1 prior to the beginning of such
next quota year. Furthermore, if a government that has designated importers
for a quota year determines that it will
not continue to designate importers for
the next quota year, it shall so indicate
directly and in writing to the Licensing Authority, not later than July 1
prior to such next quota year.
[80 FR 44254, July 27, 2015]

§ 6.26 Surrender and reallocation.
(a) If a licensee determines that it
will not enter the entire amount of an
article permitted under its license,
such licensee shall surrender its license
right to enter the amount that it does
not intend to enter. Surrender shall be
made to the Licensing Authority no
later than October 1. Any surrender
shall be final and shall be only for that
quota year, except as provided in
§ 6.25(b). The amount of the license not
surrendered shall be subject to the license use requirements of § 6.23(c)(1).
(b) For each quota year, the Licensing Authority will, to the extent practicable, reallocate any amounts surrendered.
(c) Any person who qualified for or
was issued a cheese or cheese product
license for a quota year may apply to
receive additional license, or addition
to an existing license for a portion of
the amount being reallocated. A person

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Office of the Secretary, USDA

§ 6.28

who did not qualify for a cheese or
cheese product license for a quota year,
but qualified only for a license for articles other than cheese or cheese products, may only apply to receive an additional license for articles other than
cheese or cheese products, or addition
to an existing license for articles other
than cheese or cheese products for a
portion of the amount being reallocated. The application shall be submitted to the Licensing Authority no
earlier than September 1 and not later
than September 15, and shall specify:
(1) The name and control number of
the applicant;
(2) The article and country being requested, the applicable HTS Additional
U.S. Note number and, if more than
one article is requested, a rank-order
by Additional U.S. Note number; and
(3) If applicable, the number of the license issued to the applicant for that
quota year permitting entry of the
same article from the same country.
(d) The Licensing Authority will reallocate surrendered amounts among
applicants as follows:
(1) The minimum license size, or addition to an existing license, will be
the total amount of the article from a
country surrendered, or 10,000 kilograms, whichever is less;
(2) Minimum size licenses, or additions to an existing license, will be allocated among applicants requesting
articles on the basis of the rank-order
lottery system described in § 6.25(c);
(3) If there is any amount of an article from a country left after minimum
size licenses have been issued, the Licensing Authority may allocate the remainder in any manner it determines
equitable among applicants who have
requested that article; and
(4) No amount will be reallocated to
a licensee who has surrendered a portion of its license for the same article
from the same country during that
quota year unless all other licensees
applying for a reallocated quantity
have been allocated a license;
(e) However, if the government of an
exporting country chooses to designate
eligible importers for surrendered
amounts under Appendix 3, the Licensing Authority shall issue the licenses
in accordance with § 6.25(d)(2), provided
that the government of the exporting

country notifies the Licensing Authority of its designations no later than
September 1. Such notification shall
contain the names, addresses, and
emails addresses of the importers that
it is designating and the amount in
kilograms of such article for which
each importer is being designated. In
such case the requirements of paragraph (c) of this section shall not
apply.
[80 FR 44254, July 27, 2015]

§ 6.27 Limitations on use of license.
(a) A licensee shall not obtain or use
a license for speculation, brokering, or
offering for sale, or permit any other
person to use the license for profit.
(b) A licensee who is eligible as a
manufacturer or processor, pursuant to
§ 6.23, shall process at least 75 percent
of its licensed imports in such person’s
own facilities and maintain the records
necessary to so substantiate.
[80 FR 44254, July 27, 2015]

§ 6.28 Transfer of license.
(a) If a licensee sells or conveys its
business involving articles covered by
this subpart to another person, including the complete transfer of the attendant assets, the Licensing Authority will transfer to such other person
the historical, nonhistorical or designated license issued for that quota
year. Such sale or conveyance must be
unconditional, except that it may be in
escrow with the sole condition for return of escrow being that the Licensing
Authority determines that such sale
does not meet the requirements of this
paragraph.
(b) The parties seeking transfer of license shall give written notice to the
Licensing Authority of the intended
sale or conveyance described in paragraph (a) of this section by email. The
notice must be received by the Licensing Authority at least 20 working days
prior to the intended consummation of
the sale or conveyance. Such notice
shall include electronic copies of the
documents of sale or conveyance. The
Licensing Authority will review the
documents for compliance with the requirements of paragraph (a) of this section and advise the parties in writing
of its findings by the end of the 20-day

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7 CFR Subtitle A (1–1–16 Edition)

period. The parties shall have the burden of demonstrating to the satisfaction of the Licensing Authority that
the contemplated sale or conveyance
complies with the requirements of
paragraph (a) of this section. Within 15
days of the consummation of the sale
or conveyance, the parties shall email
the final documents to the Licensing
Authority. The Licensing Authority
will not transfer the licenses unless the
documents are submitted in accordance with this paragraph.
(c) The eligibility for a license of a
person to whom a business is sold or
conveyed will be determined for the
next quota year in accordance with
§ 6.23. For the purposes of § 6.23(b)(1) the
person to whom a business is sold or
conveyed shall be deemed to be the person to whom the historical licenses
were issued during the quota year in
which the sale or conveyance occurred.
Further, for the purposes of § 6.23(b)
and (c), the entries made under such licenses by the original licensee during
the year in which the sale of conveyance is made, shall be considered as
having been made by the person to
whom the business was sold or conveyed.

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[80 FR 44254, July 27, 2015]

§ 6.29 Use of licenses.
(a) An article entered under a license
shall be an article produced in the
country specified on the license.
(b) An article entered or withdrawn
from warehouse for consumption under
a license must be entered in the name
of the licensee as the importer of
record by the licensee or its agent, and
must be owned by the licensee at the
time of such entry.
(c) If the article entered or withdrawn from warehouse for consumption
was purchased by the licensee through
a direct sale from a foreign supplier,
the licensee shall present, at the time
of entry:
(1) A true and correct copy of a
through bill of lading from the country; and
(2) A commercial invoice or bill of
sale from the seller, showing the quantity and value of the product, the date
of purchase and the country; or
(3) Where the article was entered into
warehouse by the foreign supplier, CBP

Form 7501 endorsed by the foreign supplier, and the commercial invoice.
(d) If the article entered was purchased by the licensee via sale-in-transit, the licensee shall present, at the
time of entry:
(1) A true and correct copy of a
through bill of lading endorsed by the
original consignee of the goods;
(2) A certified copy of the commercial invoice or bill of sale from the foreign supplier to the original consignee
of the goods; and
(3) A commercial invoice or bill of
sale from the original consignee to the
licensee.
(e) If the article entered was purchased by the licensee in warehouse,
the licensee shall present, at the time
of entry:
(1) CBP Form 7501 endorsed by the
original consignee of the goods;
(2) A certified copy of the commercial invoice or bill of sale from the foreign supplier to the original consignee
of the goods; and
(3) A commercial invoice or bill of
sale from the original consignee to the
licensee.
(f) The Licensing Authority may
waive the requirements of paragraphs
(c), (d) or (e), if it determines that because of strikes, lockouts or other unusual circumstances, compliance with
those requirements would unduly
interfere with the entry of such articles.
(g) Nothing in this subpart shall prevent the use of immediate delivery in
accordance with the provisions of CBP
regulations relating to tariff-rate
quotas.
[80 FR 44254, July 27, 2015]

§ 6.30 Record maintenance and inspection.
A licensee shall retain all records relating to its purchases, sales and transactions governed by this subpart, including all records necessary to establish the licensee’s eligibility, for five
years subsequent to the end of the
quota year in which such purchases,
sales or transactions occurred. During
that period, the licensee shall, upon
reasonable notice and during ordinary
hours of business, grant officials of the
U.S. Department of Agriculture full
and complete access to the licensee’s

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Office of the Secretary, USDA

§ 6.35

premises to inspect, audit or copy such
records.
[80 FR 44254, July 27, 2015]

§ 6.31 Debarment and suspension.
The provisions in 7 CFR part 3017—
Government-wide Debarment and Suspension (Nonprocurement) and Government Requirements for Drug-Free
Workplace
(Grants),
subparts
A
through E, apply to this subpart.
[80 FR 44254, July 27, 2015]

§ 6.32 Globalization of licenses.
If the Licensing Authority determines that entries of an article from a
country are likely to fall short of that
country’s allocated amount as indicated in Appendices 1, 2, and 3, the Licensing Authority may permit, with
the approval of the Office of the United
States Trade Representative, the applicable licensees to enter the remaining
balance or a portion thereof from any
country during that quota year. Requests for consideration of such adjustments must be submitted to the Licensing Authority no later than September 1. The Licensing Authority will
obtain prior consent for such an adjustment of licenses from the government
of the exporting country for quantities
in accordance with the Uruguay Round
commitment of the United States. No
globalization requests will be considered prior to April 1 of each year.

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[80 FR 44254, July 27, 2015]

§ 6.33 License fee.
(a) A fee will be assessed each quota
year for each license to defray the Department’s costs of administering the
licensing system. To the extent practicable, the fee will be announced by
the Licensing Authority in a notice
published in the FEDERAL REGISTER no
later than August 31 of the year preceding the quota year for which the fee
is assessed.
(b) The license fee for each license
issued is due and payable in full no
later than March 15 of the year for
which the license is issued. The fee for
any license issued after March 15 of
any quota year is due and payable in
full no later than 10 days from the date
of issuance of the license. Fee payments are payable to the Treasurer of

the United States and shall be made
solely utilizing the electronic software
designated for the purpose by the Licensing Authority as provided in
§ 6.36(b).
(c) If the license fees for all licenses
issued to a licensee are not paid by the
final payment date, a hold will be
placed on the use of all licenses issued
to the licensee and no articles will be
permitted entry under those licenses.
The Licensing Authority shall send a
warning by email advising the licensee
that if payment is not made in accordance with § 6.36(b) and received within
10 calendar days from the date of the
email, all licenses issued to that licensee will be revoked. Where the license at issue is a historical license,
this will result, pursuant to § 6.23(b), in
the person’s loss of historical eligibility for such license.
[80 FR 44254, July 27, 2015]

§ 6.34 Adjustment of appendices.
(a) Whenever a historical license (Appendix 1) is not issued to an applicant
pursuant to the provisions of § 6.23, is
permanently surrendered or is revoked
by the Licensing Authority, the
amount of such license will be transferred to Appendix 2.
(b) The cumulative annual transfers
to Appendix 2 made in accordance with
paragraph (a) of this section will be
published by Notice in the FEDERAL
REGISTER each year. If a transfer results in the addition of a new article,
or an article from a country not previously listed in Appendix 2, the Licensing Authority shall afford all eligible applicants for that quota year the
opportunity to apply for a license for
such article.
[80 FR 44254, July 27, 2015]

§ 6.35 Correction of errors.
(a) If a person demonstrates, to the
satisfaction of the Licensing Authority, that errors were made by officers
or employees of the United States Government, the Licensing Authority will
review and rectify the errors to the extent permitted under this subpart.
(b) To be considered, a person must
provide sufficient documentation regarding the error to the Licensing Authority by email, not later than August

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7 CFR Subtitle A (1–1–16 Edition)

31 of the calendar year following the
calendar year in which the error was
alleged to have been committed.
(c) If the error resulted in the loss of
a historical license by a license holder,
the Licensing Authority will transfer
the amount of such license from Appendix 2 to Appendix 1 in order to provide for the issuance of such license in
the calendar year following the calendar year for which the license was
revoked. The cumulative annual transfers to Appendix 1 in accordance with
this paragraph will be published in the
FEDERAL REGISTER.
[80 FR 44254, July 27, 2015]

§ 6.36

Miscellaneous.

(a) If any deadline date in this subpart falls on a Saturday, Sunday, or a
Federal holiday, then the deadline
shall be the next business day.
(b) All applications and fee payments
required under this subpart shall be
made utilizing the electronic software
designated for this purpose by the Licensing Authority, and official correspondence with the Licensing Authority, except as provided under
§ 6.28(b), shall be by email. Digital
scanned versions (e.g. PDF, JPEG, TIF,
etc.) of hardcopy documents submitted
by email are acceptable electronic
communications.
[80 FR 44254, July 27, 2015]

Subpart—Price-Undercutting
of
Domestic Cheese by Quota
Cheeses
AUTHORITY: Sec. 702, Pub. L. 96–39, 93 Stat.
144, 19 U.S.C. 1202 note.

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SOURCE: 45 FR 9883, Feb. 13, 1980, unless
otherwise noted.

§ 6.40 General.
This subpart sets forth the procedures applicable to the determination
by the Secretary of Agriculture as to
whether the price at which any article
of quota cheese is being offered for sale
in the United States on a duty-paid
wholesale basis is less than the domestic wholesale market price of similar
articles produced in the United States
(i.e., price-undercutting) in accordance
with section 702 of the Trade Agree-

ments Act of 1979 (Pub. L. 96–39, 93
Stat. 144, 19 U.S.C. 1202 note) (hereinafter referred to as the Act).
§ 6.41

Definitions.

(a) Complainant means the person
who has filed with the Investigating
Authority, in accordance with the procedures set forth in this subpart, a
written complaint alleging that priceundercutting is occurring.
(b) Country of origin means the country, as defined in 19 CFR 134.1(b), in
which the quota article subject to this
regulation was produced or manufactured.
(c) Foreign government means the government of the country of origin or, for
purposes of determining whether a subsidy has been provided for the member
states of the European Economic Community, the subsidy granting bodies of
the European Economic Community.
(d) Investigating Authority means the
Director, Dairy, Livestock and Poultry
Division, Commodity Programs, Foreign Agricultural Service.
(e) Quota cheese means the articles
provided for in the following items of
the Tariff Schedules of the United
States:
117.00 (except Stilton produced in the
United Kingdom);
117.05 (except Stilton produced in the
United Kingdom);
117.15;
117.20;
117.25;
117.42;
117.44;
117.55;
117.60 (except Gammelost and Nokkelost);
117.75 (except goat’s milk cheeses and softripened cow’s milk cheeses);
117.81;
117.86;
117.88 (except goat’s milk cheeses and softripened cow’s milk cheeses);

(f) Secretary means the Secretary of
Agriculture.
(g) Subsidy has the same meaning as
such term has in section 771(5) of the
Tariff Act of 1930 as added by section
101 of the Trade Agreements Act of 1979
(19 U.S.C. 1677(5)).
(h) The United States means the Customs Territory of the United States,
which is limited to the United States,
District of Columbia and Puerto Rico.

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§ 6.43

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§ 6.42 Complaints of price-undercutting.
(a) Submission of complaint. Any person who has reason to believe that the
price at which any article of quota
cheese is offered for sale or sold in the
United States on a duty-paid wholesale
price basis is less than the domestic
wholesale market price of similar articles produced in the United States and
that a foreign government is providing
a subsidy with respect to such article
of quota cheese may file with the Investigating Authority a written complaint making such allegation.
(b) Contents of complaint. Such complaint shall contain, or be accompanied
by, information to substantiate complainant’s allegations, in substantially
the following form:
(1) The name and address of the complainant.
(2) The location of the domestic
wholesale market in which price-undercutting is alleged to be occurring.
(3) The article of quota cheese involved in the alleged price-undercutting.
(4) The country of origin of such article of quota cheese.
(5) The similar domestic article, the
price of which the complainant believes is being undercut.
(6) The month and year that the complainant first concluded that the priceundercutting was taking place.
(7) To extent known to the complainant, all pertinent facts with regard to
the alleged subsidy, and, if known, the
statutory or other authority under
which it is paid, the manner in which it
is paid, and the value of such subsidy
when received and used by producers or
sellers of such quota cheese.
(8) All other information which the
complainant believes substantiates the
allegation of price-undercutting, including the complainant’s estimate of
the domestic wholesale market price of
the similar article produced in the
United States and the duty-paid wholesale price of the quota cheese involved.
If available, samples of the domestic
and imported cheese products should be
submitted.
§ 6.43 Determinations.
(a) Making determinations. Not later
than 30 days after receiving an accept-

able complaint, as described in § 6.42(b),
alleging price-undercutting, the Secretary shall make a determination as
to the validity of the allegation. In
making such determination, the following shall apply:
(1) The ‘‘domestic wholesale market’’
shall be one or more of the three major
U.S. market areas, viz., New York City,
Chicago, and San Francisco, and/or any
other market area within the Customs
Territory of the United States, which
the Investigating Authority determines most representative of the area
specified by the complainant as the one
in which price-undercutting is alleged
to be occurring (hereinafter referred to
as ‘‘designated area’’).
(2) The ‘‘duty-paid wholesale price’’
determined by the Investigating Authority shall be the average of prices at
which wholesalers have sold or offered
for sale in the designated area the article of quota cheese alleged to be involved in price-undercutting, as obtained in a survey directed by the Investigating Authority during the investigation: Provided, That whenever the
designated area is not or does not include one of the major market areas
specified in paragraph (a)(1) of this section, the Investigating Authority may
adjust the average of prices determined
for such designated area on the basis of
the average of prices determined for
the major market area which is determined to be the most representative of
the designated area, taking into consideration any special factors which
may be affecting prices in the designated area.
(3) The ‘‘domestic wholesale market
price’’ determined by the Investigating
Authority for a similar article produced in the United States to that article of quota cheese which is alleged to
be involved in price-undercutting shall
be the average of prices at which
wholesalers have sold the similar article produced in the United States in
the designated area, as obtained in a
survey directed by the Investigating
Authority during the investigation:
Provided, That whenever the designated
area is not or does not include one of
the major market areas specified in
paragraph (a)(1) of this section, the Investigating Authority may adjust the
average of prices determined for such

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§ 6.44

7 CFR Subtitle A (1–1–16 Edition)

designated area on the basis of the average of prices determined for the
major market area which is determined to be the most representative of
the designated area, taking into consideration any special factors which
may be affecting prices in the designated area.
(4) ‘‘Similar article produced in the
United States’’ shall be an article of
cheese, cheese product, or imitation
cheese produced in the United States
and marketed in the domestic wholesale market, which is determined by
the Investigating Authority, based
upon available information to be most
like the imported article of quota
cheese alleged to be involved in priceundercutting, in terms of its physical
properties and end use. In making this
determination,
first
consideration
shall be given to the normal end uses of
the article produced in the United
States in comparison with the end use
of the article of quota cheese alleged to
be involved in price-undercutting. If
the end use of both articles is determined to be the same (e.g., processing
or retail sale), the physical characteristics of the two articles shall be considered.
If the common end use of the two articles is processing, the representative
samples of the two articles shall be examined in terms of processing quality,
taking special note of processing
yields. If the common end use of the
two articles is retail sale, representative samples of the two articles shall
be examined in terms of similarities of
taste, texture, general appearance,
quality, age, and packaging. Imported
imitation quota cheese shall only be
compared with imitation domestic
cheese. If it is determined that the domestic cheese the price of which is
claimed to be undercut is not similar
to the quota cheese allegedly undercutting it, there shall be no finding of
price-undercutting.
(b) Reporting determinations. Determinations by the Secretary as to the
validity of allegations of price-undercutting made under this subpart shall
be published in the FEDERAL REGISTER
not later than 5 days after the date the
determination is made.

§ 6.44 Delegation of authority.
The powers vested in the Administrator, FAS, insofar as such powers relate to the functions of the Investigating Authority by this regulation
are hereby delegated to the Investigating Authority. This final rule has
been reviewed under the USDA criteria
established to implement Executive
Order 12044, ‘‘Improving Government
Regulations.’’ a determination has
been made that this action should not
be classified ‘‘significant’’ under those
criteria. A Final Impact Statement has
been prepared and is available from
Carol M. Harvey in room 6622, South
Agriculture Building, 14th and Independence Ave., SW., Washington, DC
20250.

PART 7—SELECTION AND FUNCTIONS OF FARM SERVICE AGENCY STATE AND COUNTY COMMITTEES
Sec.
7.1 Administration.
7.2 General.
7.3 Definitions.
7.4 Selection of committee members.
7.5 Eligible voters.
7.6 Establishment of local administrative
areas.
7.7 Calling of elections.
7.8 Nominations for county committee.
7.9 Slate of candidates.
7.10 Conduct of county committee elections.
7.11 Election of county committee members.
7.12 Composition of a county committee.
7.13 Tie votes.
7.14 Vacancies.
7.15 Challenges and appeals.
7.16 Report of election.
7.17 Remedial measures.
7.18 Eligibility requirements of county
committee members.
7.19 Eligibility requirements of all other
personnel.
7.20 Prohibition on dual office.
7.21 Terms of office of county committee
members.
7.22 State committee duties.
7.23 County committee duties.
7.24 Chairperson of the county committee
duties.
7.25 County executive director duties.
7.26 Private business activity and conflicts
of interest.
7.27 Political activity.
7.28 Removal from office or employment for
cause.

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