[Federal Register Volume 77, Number 185 (Monday, September 24, 2012)]
[Notices]
[Pages 58809-58811]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-23456]


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DEPARTMENT OF COMMERCE

International Trade Administration

[Application No. 12-00005]


Export Trade Certificate of Review

ACTION: Notice of issuance of an Export Trade Certificate of Review to 
Colombia Rice Export Quota, Inc. (``COL-RICE'') (Application 
12-00005).

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SUMMARY: On August 28, 2012, the U.S. Department of Commerce issued an 
Export Trade Certificate of Review to Colombia Rice Export Quota, Inc. 
(``COL-RICE''). This notice summarizes the conduct for which 
certification has been granted.

FOR FURTHER INFORMATION CONTACT: Joseph E. Flynn, Director, Office of 
Competition and Economic Analysis, International Trade Administration, 
by telephone at (202) 482-5131 (this is not a toll-free number) or 
email at [email protected].

SUPPLEMENTARY INFORMATION: Title III of the Export Trading Company Act 
of 1982 (15 U.S.C. Sections 4001-21) authorizes the Secretary of 
Commerce to issue Export Trade Certificates of Review. The regulations 
implementing Title III are found at 15 CFR Part 325 (2010). The U.S. 
Department of Commerce, International Trade Administration, Office of 
Competition and Economic Analysis (``OCEA'') is issuing this notice 
pursuant to 15 CFR 325.6(b), which requires the Secretary of Commerce 
to publish a summary of the issuance in the Federal Register. Under 
Section 305(a) of the Export Trading Company Act (15 U.S.C. 4012(b)(1)) 
and 15 CFR 325.11(a), any person aggrieved by the Secretary's 
determination may, within 30 days of the date of this notice, bring an 
action in any appropriate district court of the United States to set 
aside the determination on the ground that the determination is 
erroneous.

Members (Within the Meaning of 15 CFR 325.2(l)

    COL-RICE's members under this certificate are: the Arkansas Rice 
Research and Promotion Board, the California Rice Research Board, the 
Louisiana Rice Research Board, the Mississippi Rice Promotion Board, 
the Missouri Rice Research and Merchandising Council, the Texas Rice 
Producers' Board, the USA Rice Merchants' Association, the USA Rice 
Millers' Association, and, Federaci[oacute]n Nacional de Arroceros de 
Colombia (FEDEARROZ).

Description of Certified Conduct

    COL-RICE is certified to engage in the Export Trade Activities and 
Methods of Operation described below in the following Export Trade and 
Export Markets.

Export Trade

    COL-RICE plans to export rice products as described in the 
Agricultural Tariff Schedule of the Republic of Colombia, as appended 
to the United States--Colombia Trade Promotion Agreement (TPA), and 
including the following Colombian HTS Codes: 1006.1090--rice in hull, 
except for seed (arroz con cascara, except para siembra); 1006.2000--
hulled rice, rough rice or brown rice (arroz descascarillado, arroz 
cargo o arroz pardo); 1006.3000--rice semi-milled or milled, whether 
polished or glazed (arroz semiblanqueado o blanqueado, incluso pulido o 
glaseado); 1006.4000--broken rice (arroz partido).

Export Market

    The Republic of Colombia.

Export Trade Activities and Methods of Operation

    With respect to the conduct of Export Trade in the Export Market, 
COL-RICE may, subject to the terms and conditions set forth below, 
engage in the following Export Trade Activities and Methods of 
Operation:
    1. Purpose: COL-RICE will manage on an open tender basis the 
tariff-rate quotas (TRQs) for rice products granted by the Republic of 
Colombia to the United States under the terms of the TPA or any amended 
or successor agreement providing for Colombian TRQs for rice from the 
United States.
    Specifically, the TRQs for rice products are set forth at Paragraph 
20 of Appendix I of the General Notes of Colombia, Annex 2.3 to the 
TPA. COL-RICE also will provide for distributions of the proceeds 
received from the tender process based on exports of rice products to 
support the operation and administration of COL-RICE and to fund 
research projects for the benefit of the rice industry of the United 
States and to fund market development and/or competitiveness projects 
for the benefit of the rice production sector of the Republic of 
Colombia, as established by paragraph 6 of Article 5 of Decree No. 0728 
of 2012, issued by the Ministry of Agriculture and Rural Development of 
Colombia.
    2. Administrator. COL-RICE shall contract with a neutral third 
party Administrator who shall administer the TRQ System, subject to 
general supervision and oversight by the Board of Directors of COL-
RICE.
    3. Open Tender Process. COL-RICE shall offer TRQ Certificates for 
duty-free shipments of rice to the Republic of Colombia solely and 
exclusively through an open tender process with certificates (``TRQ 
Certificates'') awarded to the highest bidders. COL-RICE shall hold 
tenders in accordance with established tranches at least once each 
year. The award of TRQ Certificates under the open tender process shall 
be determined solely and independently by the Administrator without any 
participation by the members of COL-RICE or the COL-RICE Board of 
Directors.
    4. Persons or Entities Eligible to Bid. Any person or entity 
incorporated or with a legal address in the United States of America 
shall be eligible to bid in the open tender process.
    5. Notice. The Administrator shall publish notice (``Notice'') of 
each open tender process to be held to award TRQ Certificates in the 
Journal of Commerce and, at the discretion of the Administrator, in 
other publications of general circulation within the U.S. rice industry 
or in the Republic of Colombia. The Notice will invite independent bids 
and will specify (i) the total amount (in metric tons) that will be 
allocated pursuant to the applicable tender; (ii) the shipment period 
for which the TRQ Certificates will be valid; (iii) the date and time 
by which all bids must be received by the Administrator in order to be 
considered (the ``Bid Date''); and (iv) a minimum bid amount per ton, 
as established by the Board of Directors, to ensure the costs of 
administering the auction are recovered. The Notice normally will be 
published not later than 30 calendar days prior to the first day of the 
auction process and will specify the Bid Date. The Notice will specify 
the format for bid submissions. Bids must be received by the 
Administrator not later than 5 p.m. EST on the Bid Date.
    6. Contents of Bid. The bid shall be in a format established by the 
Administrator and shall state (i) the name, address, telephone and 
facsimile numbers, and email address of the bidder; (ii) the quantity 
of rice bid, in an amount stated in metric tons or fractions thereof; 
(iii) the bid price in U.S. dollars per metric ton; and (iv) the total 
value of the bid. The bid form shall contain

[[Page 58810]]

a provision that must be signed by the bidder, agreeing that (i) any 
dispute that may arise relating to the bidding process or to the award 
of TRQ Certificates shall be settled by arbitration administered by the 
American Arbitration Association in accordance with its Commercial 
Arbitration Rules; and (ii) judgment on any award rendered by the 
arbitrator may be entered in any court having jurisdiction thereof.
    7. Performance Security. The bidder shall submit with each bid a 
performance bond, irrevocable letter of credit drawn on a U.S. bank, 
cashier's check, wire transfer or equivalent security, in a form 
approved and for the benefit of an account designated by the 
Administrator, in the amount of $50,000 or the total value of the bid, 
whichever is less. The bidder shall forfeit such performance security 
if the bidder fails to pay for any TRQ Certificates awarded within five 
(5) business days of being notified of a TRQ award. The bidder may 
choose to apply the performance security to the price of any successful 
bid. Promptly after the close of the open tender process, the 
Administrator shall return any unused or non-forfeited security to the 
bidder.
    8. Confidentiality of Bids. The Administrator shall treat all bids 
and their contents as confidential. The Administrator shall disclose 
information about bids only to another neutral third party, or 
authorized government official of the United States or of the Republic 
of Colombia and only as necessary to ensure the effective operation of 
the TRQ System or where required by law. However, after the issuance of 
all TRQ Certificates from an open tender process, the Administrator 
shall notify all bidders and shall disclose publicly (i) the total 
tonnage for which TRQ Certificates were awarded, and (ii) the average 
price and lowest price per metric ton of all successful bids.
    9. Award of TRQ Certificates. The Administrator shall award TRQ 
Certificates for the available tonnage to the bidders who have 
submitted the highest price conforming bids. If two or more bidders 
have submitted bids with identical prices, the Administrator shall 
divide the remaining available tonnage in proportion to the quantities 
of their bids, and offer each TRQ Certificates in the resulting 
tonnages. If any bidder declines all or part of the tonnage offered, 
the Administrator shall offer that tonnage first to the other tying 
bidders, and then to the next highest bidder.
    10. Payment for TRQ Certificates. Promptly after being notified of 
a TRQ award and within the time specified in the Notice, the bidder 
shall pay the full amount of the bid, either by wire transfer or by 
certified check, to an account designated by the Administrator. If the 
bidder fails to make payment within five (5) days, the Administrator 
shall revoke the award and award the tonnage to the next highest 
bidder(s).
    11. Delivery of TRQ Certificates. The Administrator shall establish 
an account for each successful bidder in the amount of tonnage 
available for TRQ Certificates. Upon request, the Administrator will 
issue TRQ Certificates in the tonnage designated by the bidder, 
consistent with the balance in that account. The TRQ Certificate shall 
state the delivery period for which it is valid.
    12. Transferability. TRQ Certificates shall be freely transferable 
except that (i) any TRQ Certificate holder that intends to sell, 
transfer or assign any rights under that Certificate shall publish such 
intention on an internet site maintained by the Administrator at least 
three (3) business days prior to any sale, transfer or assignment; and 
(ii) any TRQ holder who sells, transfers or assigns its rights under a 
TRQ Certificate shall provide the Administrator with notice and a copy 
of the sale, transfer or assignment within three (3) business days.
    13. Deposit of Proceeds: The Administrator shall cause all proceeds 
of the open tender process to be deposited in an interest-bearing 
account in a financial institution approved by the COL-RICE Board of 
Directors.
    14. Disposition of Proceeds. The proceeds of the open tender 
process shall be applied and distributed as follows:
    i. The Administrator shall pay from tender proceeds, as they become 
available, all operating expenses of COL-RICE, including legal, 
accounting and administrative costs of establishing and operating the 
TRQ System, as authorized by the Board of Directors.
    ii. The legal, accounting, and administrative expenses of the USA 
Rice Federation, the U.S. Rice Producers Association, and 
Federaci[oacute]n Nacional de Arroceros de Colombia (FEDEARROZ) 
directly related to establishing COL-RICE shall be reimbursed from the 
proceeds of COL-RICE as such proceeds become available, subject to 
review by the COL-RICE Board.
    iii. Of the proceeds remaining at the end of each year of 
operations after all costs described in (i) and (ii) have been paid--
    1. In years one (1) through ten (10), fifty percent (50%) shall be 
distributed to each of the six (6) state chartered rice research boards 
named as members above on a pro rata basis, that share being each 
state's pro rata share of the average of the immediately preceding 
three (3) years U.S. rice production, to fund rice research projects as 
defined by each of the six (6) state chartered research boards to 
benefit the United States rice industry. The funds are to be used for 
direct research projects and not to be used for general administrative 
purposes.
    2. In years eleven (11) through eighteen (18), fifty percent (50%) 
shall be distributed to each of the six (6) state chartered rice 
research boards named as members above on a pro rata basis, that share 
being each state's pro rata share of the average of the immediately 
preceding three (3) years U.S. rice production, to fund research and 
promotion projects as defined by each of the six (6) state chartered 
research boards to benefit the United States rice industry as may be 
within the purview of each board. These funds are to be used for direct 
projects and are not to be used for general administrative purposes.
    3. Fifty percent (50%) shall be distributed to FEDEARROZ to fund 
market development and/or competitiveness projects for the benefit of 
the rice production sector of the Republic of Colombia, as established 
by paragraph 6 of Article 5 of Decree No. 0728 of 2012, issued by the 
Ministry of Agriculture and Rural Development of Colombia.
    15. Arbitration of Disputes. Any dispute, controversy or claim 
arising out of or relating to the TRQ System or the breach thereof, 
including inter alia, a Member's qualification for distribution, 
interpretation of documents, or of the distribution itself, shall be 
settled by arbitration administered by the American Arbitration 
Association in accordance with its Commercial Arbitration Rules, and 
judgment on the award rendered by the arbitrator may be entered in any 
court having jurisdiction thereof.
    16. Confidential Information. The Administrator shall maintain as 
confidential all export documentation or other business sensitive 
information submitted in connection with application for COL-RICE 
membership, bidding in the open tender process, or requests for 
distribution of proceeds, where such documents or information has been 
marked ``Confidential'' by the person making the submission. The 
Administrator shall disclose such information only to another neutral 
third party or authorized government official of the United States or 
of the

[[Page 58811]]

Republic of Colombia and only as necessary to ensure the effective 
operation of the TRQ System or where required by law (including 
appropriate disclosure in connection with the arbitration of a 
dispute).
    17. Annual Reports. COL-RICE shall publish an annual report 
including a statement of its operating expenses and data on the 
distribution of proceeds, as reflected in the audited financial 
statement of COL-RICE.

Terms and Conditions

    In engaging in Export Trade Activities and Methods of Operation,
    1. Except as authorized in Paragraph 15 of the Export Trade 
Activities and Methods of Operation, neither COL-RICE, the 
Administrator, any Member, nor any neutral third party shall 
intentionally disclose, directly or indirectly, to any Member 
(including parent companies, subsidiaries, or other entities related to 
any Member) any information regarding any other Member's or bidder's 
costs, production, capacity, inventories, domestic prices, domestic 
sales, or U.S. business plans, strategies, or methods, unless such 
information is already generally available to the trade or public.
    2. COL-RICE will comply with requests made by the Secretary of 
Commerce on behalf of the Secretary or the Attorney General for 
information or documents relevant to conduct under the Certificate. The 
Secretary of Commerce will request such information or documents when 
either the Attorney General or the Secretary of Commerce believes that 
the information or documents are required to determine that the Export 
Trade, Export Trade Activities and Methods of Operation of a person 
protected by this Certificate of Review continue to comply with the 
standards of section 303(a) of the Act.
    3. COL-RICE will ensure that the Administrator holds an auction at 
least once a year. Failure to so hold an auction may result in 
revocation of the certificate.

Definitions

    ``Neutral third party'', as used in this Certificate of Review, 
means a party not otherwise associated with COL-RICE or any Member and 
who is not engaged in the production, sale, distribution or export of 
rice products.

    Date: September 18, 2012.
Joseph E. Flynn,
Director, Office of Competition and Economic Analysis.
[FR Doc. 2012-23456 Filed 9-21-12; 8:45 am]
BILLING CODE 3510-DR-P