[Federal Register Volume 63, Number 152 (Friday, August 7, 1998)]
[Proposed Rules]
[Pages 42283-42284]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-20755]


 ========================================================================
 Proposed Rules
                                                 Federal Register
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 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
 
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 

  Federal Register / Vol. 63, No. 152 / Friday, August 7, 1998 / 
Proposed Rules  

[[Page 42283]]


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DEPARTMENT OF AGRICULTURE

Office of the Secretary

7 CFR Part 17

RIN 0551-AA54


Regulations Governing the Financing of Commercial Sales of 
Agricultural Commodities

AGENCY: Commodity Credit Corporation.

ACTION: Proposed rule.

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SUMMARY: The Commodity Credit Corporation (CCC) proposes to revise the 
regulations applicable to the financing of the sale and exportation of 
agricultural commodities pursuant to title I of the Agricultural Trade 
Development and Assistance Act of 1954, as amended (Pub. L. 480). The 
proposed rule would permit a waiver of the present requirement that 
only private entities with a business office or agent in the United 
States are eligible to enter into title I, Pub. L. 480 agreements when 
the General Sales Manager determines that there is adequate assurance 
of repayment to CCC. This change would allow additional foreign private 
entities to participate in title I, and thereby increase exports of 
U.S. agricultural commodities.

DATES: Comments on this rule must be received by September 8, 1998.

ADDRESSES: Comments should be sent to Grant Pettrie, Acting Director, 
Program Development Division, Foreign Agricultural Service, U.S. 
Department of Agriculture, Room 4506, South Building, Stop 1034, 
Washington, D.C. 20250-1034.

FOR FURTHER INFORMATION CONTACT: Grant Pettrie, Acting Director, 
Program Development Division, Foreign Agricultural Service, U.S. 
Department of Agriculture, Room 4506, South Building, Stop 1034, 
Washington, D.C. 20250-1034; telephone: (202) 720-4221; Facsimile: 
(202) 690-0251.

SUPPLEMENTARY INFORMATION: This proposed rule is issued in conformance 
with Executive Order 12866. Based on information compiled by the 
Department, it has been determined that this proposed rule:
    (1) Would have an annual effect on the economy of less than $100 
million;
    (2) Would not adversely affect in a material way the economy, a 
sector of the economy, productivity, competition, jobs, the 
environment, public health or safety, or State, local, or tribal 
governments or communities;
    (3) Would not create a serious inconsistency or otherwise interfere 
with an action taken or planned by another agency;
    (4) Would not alter the budgetary impact of entitlements, grants, 
user fees, or loan programs or rights and obligations of recipients 
thereof; and
    (5) Would not raise novel legal or policy issues arising out of 
legal mandates, the President's priorities, or principles set forth in 
Executive Order 12866.

Regulatory Flexibility Act

    This proposed rule has been reviewed with regard to the 
requirements of the Regulatory Flexibility Act. The Vice President, 
CCC, who is the General Sales Manager, has certified that this rule 
will not have a significant economic impact on a substantial number of 
small entities.
    Under title I, P. L. 480 CCC enters into agreements with foreign 
governments or private entities to finance their purchase and 
importation of U.S. agricultural commodities. The proposed rule would 
allow a waiver of an existing program requirement that restricts the 
eligibility of businesses in foreign countries to enter into these 
agreements with CCC. A copy of this proposed rule has been submitted to 
the General Counsel, Small Business Administration.

Executive Order 12372

    This program is not subject to the provisions of Executive Order 
12372 which requires intergovernmental consultation with state and 
local officials. See the Notice related to 7 CFR Part 3015, Subpart V, 
published at 48 FR 29115 (June 24, 1983).

Paperwork Reduction Act

    The information collection requirements imposed by this proposed 
rule have been previously submitted to the Office of Management and 
Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 
Chapter 35). OMB has assigned control number 0551-0005 for this 
information collection. This proposed rule would not require the 
collection of additional information.

Executive Order 12988

    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. The proposed rule would have preemptive effect 
with respect to any state or local laws, regulations, or policies which 
conflict with such provisions or which otherwise impede their full 
implementation. The final rule would not have retroactive effect. The 
rule does not require that administrative remedies be exhausted before 
suit may be filed.

Background

    Title I of the Agricultural Trade Development and Assistance Act of 
1954, as amended (Pub. L. 480) authorizes CCC to finance the sale and 
exportation of agricultural commodities on concessional credit terms, 7 
U.S.C. 1701 et seq. On October 10, 1997, CCC published a final rule (62 
FR 52929) amending the regulations governing Pub. L. 480 to, among 
other things, provide that CCC may enter into title I, P. L. 480 
agreements with private entities. However, that rule requires that, in 
order to be eligible for a title I, P. L. 480 agreement, a private 
entity must maintain a bona fide business office in the United States 
and have a person, principal, or agent on whom service of judicial 
process may be had in the United States.
    The purpose of requiring that private entities have a presence in 
the United States was to make them more amenable to legal process in 
the case of a default in repayment to CCC. It appears, however, that 
this requirement could restrict participation by some foreign private 
entities that could not meet this requirements in a practical manner. 
This could limit CCC's flexibility in programming and eliminate 
consideration of viable export opportunities that would otherwise 
further the purposes of title I, Pub. L. 480. Consequently, this 
proposed rule would allow the General Sales Manager to waive this 
requirement if the foreign private entity provides adequate assurances 
of repayment to CCC for the financing extended to it under the Pub. L. 
480 agreement. It is not necessary to

[[Page 42284]]

identify in advance what may constitute adequate assurances of 
repayment because options may vary considerably depending upon foreign 
private entities and the country involved.

List of Subjects in 7 CFR Part 17

    Agricultural commodities, Exports, Finance, Maritime carriers.
    Accordingly, it is proposed to amend Part 17 of 7 CFR as follows:

PART 17--SALES OF AGRICULTURAL COMMODITIES MADE AVAILABLE UNDER 
TITLE I OF THE AGRICULTURAL TRADE DEVELOPMENT AND ASSISTANCE ACT OF 
1954, AS AMENDED

    1. The authority citation for part 17 continues to read as follows:

    Authority: 7 U.S.C. 1701-1704, 1731-1736b, 1736f, 5676; E.O. 
12220, 45 FR 44245.

    2. Section 17.1(b)(3) is revised to read as follows:


Sec. 17.1  General

* * * * *
    (b) * * *
    (3) A private entity must maintain a bona fide business office in 
the United States and have a person, principal, or agent on whom 
service of judicial process may be had in the United States unless the 
General Sales Manager determines that there are adequate assurances of 
repayment to CCC for the financing extended by CCC.
* * * * *
    Signed at Washington D.C. on July 27, 1998.
Lon Hatamiya,
Administrator, Foreign Agricultural Service and Vice President, 
Commodity Credit Corporation.
[FR Doc. 98-20755 Filed 8-6-98; 8:45 am]
BILLING CODE 3410-10-P