[Federal Register Volume 62, Number 81 (Monday, April 28, 1997)]
[Rules and Regulations]
[Pages 22877-22879]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-10892]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 1205

[CN-96-007]


Amendment to Cotton Board Rules and Regulations Regarding Import 
Assessment Exemptions

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: The Agricultural Marketing Service is amending the regulations 
regarding import assessment exemptions by adjusting the provisions for 
automatic assessment exemptions on certain imports of textile and 
apparel products. The purpose of this automatic exemption is to avoid 
multiple assessment of U.S. produced cotton that has been exported and 
then imported back into the U.S. in the form of textile and apparel 
products. Also, this final rule will lengthen the amount of time a 
person has to request an import reimbursement from 90 days from the 
date the assessment was paid to 180 days from the date the assessment 
was paid. This rule is consistent with the

[[Page 22878]]

business practices of importers and would make it easier for importers 
to comply with the regulations.

EFFECTIVE DATE: May 28, 1997.

FOR FURTHER INFORMATION CONTACT: Craig Shackelford, Chief, Cotton 
Research and Promotion Staff, telephone number (202) 720-2259 facsimile 
(202) 690-1718.

SUPPLEMENTARY INFORMATION:

Regulatory Impact Analysis

    Executive Orders 12866 and 12988; the Regulatory Flexibility Act 
and the Paperwork Reduction Act.
    This rule has been determined to be ``not significant'' for 
purposes of Executive Order 12866, and, therefore, has not been 
reviewed by the Office of Management and Budget.
    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. It is not intended to have retroactive effect. This 
rule would not preempt any state or local laws, regulations, or 
policies, unless they present an irreconcilable conflict with this 
rule. The Cotton Research and Promotion Act, 7 U.S.C. Secs. 2101-2118 
(Act), provides that administrative proceedings must be exhausted 
before parties may file suit in court. Under Section 12 of the Act, any 
person subject to an order may file with the Secretary a petition 
stating that the order, any provision of the plan, or any obligation 
imposed in connection with the order is not in accordance with law and 
requesting a modification of the order or to be exempted therefrom. 
Such person is afforded the opportunity for a hearing on the petition. 
After the hearing, the Secretary would rule on the petition. The Act 
provides that the District Court of the United States in any district 
in which the person is an inhabitant, or has his principal place of 
business, has jurisdiction to review the Secretary's ruling, provided a 
complaint is filed within 20 days from the date of the entry of the 
ruling.
    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA) (5 U.S.C. 601 et seq.), the Administrator, Agricultural 
Marketing Service (AMS) has considered the economic impact of this 
action on small entities.
    The purpose of the RFA is to fit regulatory actions to the scale of 
businesses subject to such actions in order that small businesses will 
not be unduly or disproportionately burdened.
    There are an estimated 16,000 importers who are presently subject 
to rules and regulations issued pursuant to the Cotton Research and 
Promotion Order. This rule will affect importers of cotton and cotton-
containing products. The majority of these importers are small 
businesses under the criteria established by the Small Business 
Administration (13 CFR 121.601).
    This rule will neither raise nor lower assessments paid by 
importers subject to the Cotton Research and Promotion Order and 
therefore presents minimal economic impact. This action will improve 
the agency's ability to prevent double assessment of U.S. produced 
cotton reentering the U.S. in the form of textile and apparel products. 
In addition, this rule will lengthen the amount of time a person has to 
request an import reimbursement from 90 days from the date the 
assessment was paid to 180 days from the date the assessment was paid. 
This rule is consistent with the business practices of importers and 
would make it easier for importers to comply with the regulations.
    Under these circumstances AMS has determined that this action will 
not have a significant economic impact on a substantial number of small 
entities.
    In compliance with Office of Management and Budget (OMB) 
regulations (5 CFR Part 1320) which implement the Paperwork Reduction 
Act (PRA) (44 U.S.C. 3501 et seq.) the information collection 
requirements contained in the regulation to be amended have been 
previously approved by OMB and were assigned control number 0581-0093.

Background

    The Cotton Research and Promotion Act Amendments of 1990 enacted by 
Congress under Subtitle G of Title XIX of the Food, Agriculture, 
Conservation and Trade Act of 1990 on November 28, 1990, contained two 
provisions that authorized changes in the funding procedures for the 
Cotton Research and Promotion Program.
    These provisions are: (1) the assessment of imported cotton and 
cotton products; and (2) termination of the right of cotton producers 
to demand a refund of assessments.
    An amended the Cotton Research and Promotion Order was approved by 
producers and importers voting in a referendum held July 17-26, 1991. 
Proposed rules implementing the amended Order were published in the 
Federal Register on December 17, 1991, (56 FR 65450). The final 
implementing rules were published on July 1 and 2, 1992, (57 FR 29181) 
and (57 FR 29431), respectively.
    Section 1205.335 (c)(1) of the Cotton Research and Promotion Order 
provides for exemptions from assessments for certain imported goods 
when they contain U.S. produced cotton in order to minimize the 
occurrence of double assessments on U.S. cotton. All U.S. produced 
cotton is assessed at the time it is first sold. A significant amount 
of U.S. produced cotton is converted into fabric in the U.S. and then 
exported. This U.S. cotton containing fabric often returns to the U.S. 
in the form of apparel products.
    Section 1205.510 (b)(5) of the Cotton Board Rules and Regulations 
identifies the specific Harmonized Tariff Schedule (HTS) numbers that 
are exempted to avoid a second unnecessary assessment of this U.S. 
produced cotton. The numbers currently identified in this section have 
become out dated because of changes in the HTS. The revision of this 
section will update the exempted HTS numbers to 9802.00.8015, and 
9802.00.9000 which are currently in the HTS.
    This rule also lengthens the period of time a person has to request 
an import assessment reimbursement from 90 to 180 days from the date 
the assessment was paid. In the past the Cotton Board has received 
requests for reimbursements beyond the 90 day limit. In responding to 
these request, importers have informed the Cotton Board that the 90 day 
period is too restrictive. The Cotton Board has recognized that 
importer concern over the time period has merit. Therefore, the Cotton 
Board has requested that the Department extend the period to 180 days. 
The Cotton Board believes that this will be consistent with the 
business practices of importers, and make it easier for importers to 
comply with the regulations.
    A proposed rule with a request for comments was published in the 
Federal Register (62 FR 4666) on January 31, 1997. No comments were 
received during the comment period (January 31, through March 3, 1997).

List of Subjects in 7 CFR Part 1205

    Advertising, Agricultural research, Cotton, Marketing agreements, 
Reporting and record keeping requirements.

    For the reasons set forth in the preamble, 7 CFR part 1205 is 
amended as follows:

PART 1205--COTTON RESEARCH AND PROMOTION

    1. The authority citation for part 1205 continues to read as 
follows:

    Authority: 7 U.S.C. 2101-2118.

    2. In Sec. 1205.510, paragraph (b)(5) is revised read as follows:


Sec. 1205.510  Levy of assessments.

* * * * *

[[Page 22879]]

    (b) * * *
    (5) Imported textile and apparel articles assembled of components 
formed from cotton produced in the United States and identified by HTS 
numbers 9802.00.8015 or 9802.00.9000 shall be exempt from assessments 
under this subpart.
* * * * *
    3. In Sec. 1205.520, paragraph (b) introductory text is revised to 
read as follows:


Sec. 1205.520  Procedure for obtaining reimbursement.

* * * * *
    (b) Submission of Reimbursement Application to Cotton Board. Any 
importer requesting a reimbursement shall mail the application on the 
prescribed form to the Cotton Board. The application shall be 
postmarked within 180 days from the date the assessments were paid on 
the cotton by such importer. The reimbursement application shall show:
* * * * *
    Dated: April 22, 1997.
Lon Hatamiya,
Administrator.
[FR Doc. 97-10892 Filed 4-25-97; 8:45 am]
BILLING CODE 3410-02-P