[Federal Register Volume 88, Number 221 (Friday, November 17, 2023)]
[Rules and Regulations]
[Pages 80092-80108]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-25015]
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DEPARTMENT OF AGRICULTURE
Commodity Credit Corporation
7 CFR Part 1489
RIN 0551-AB06
Regional Agricultural Promotion Program
AGENCY: Foreign Agricultural Service and Commodity Credit Corporation,
U.S. Department of Agriculture (USDA).
ACTION: Final rule.
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SUMMARY: The Commodity Credit Corporation (CCC) is amending the
Agricultural Trade Promotion Program regulation to implement the
Regional Agricultural Promotion Program (RAPP). The RAPP will provide
assistance to eligible organizations that conduct market promotion
activities, including activities to address existing or potential non-
tariff barriers to trade, to promote U.S. agricultural commodities in
certain foreign markets. Among other changes, this rule updates
terminology used throughout the regulation, clarifies timeframes for
reporting requirements, and removes the specific application and review
[[Page 80093]]
requirements from the regulation to be defined in Notices of Funding
Opportunity (NOFOs) announced through the Grants.gov website.
DATES: This rule is effective November 17, 2023. Although not required
by the Administrative Procedure Act (APA), CCC will accept comments
received by December 18, 2023.
ADDRESSES: You may send comments, identified by RIN 0551-AB06, by any
of the following methods:
Federal eRulemaking Portal: https://www.regulations.gov.
This portal enables respondents to enter short comments or attach a
file containing lengthier comments.
Email: [email protected]. Include 0551- in the subject
line of the message.
Mail, Courier, or Hand Delivery: Curt Alt, U.S. Department
of Agriculture, Foreign Agricultural Service, 1400 Independence Avenue
SW, Room 6512, Washington, DC 20250.
FOR FURTHER INFORMATION CONTACT: Curt Alt, (202) 690-4784,
[email protected]. Persons with disabilities who require an alternative
means for communication of information (e.g., Braille, large print,
audiotape, etc.) should contact [email protected].
SUPPLEMENTARY INFORMATION:
Background
In the face of significant and unpredictable challenges around the
world, including impacts to international commodities markets in the
wake of ongoing conflicts, a changing climate, an increasing
agricultural trade deficit, and increased competition in U.S. export
markets, USDA recognizes that additional investments in market
development are needed to keep U.S. agriculture ahead of the
competition. Consistent with a bipartisan request from the Senate
Committee on Agriculture, Nutrition, and Forestry, USDA is utilizing
CCC funds to implement the RAPP program to address the challenges
related to trade impacting U.S. farmers and the international
community. Continuing the work started under the Agricultural Trade
Promotion Program (ATP), RAPP funding will ensure that U.S.
agricultural industries are able to sustain the relationships key to
effective market development and will enable exporters to break into
new markets and increase market share in growth markets. RAPP
Participants may receive assistance for either generic or brand
promotion activities as well as assistance to conduct activities to
address existing or potential non-tariff barriers to trade.
The Foreign Agricultural Service (FAS) will administer the RAPP on
behalf of the CCC. Specific program requirements and details for
applying for assistance under the RAPP will be set forth in NOFOs
announced through the Grants.gov website.
Eligible Organizations
As with ATP, the RAPP is a cost-share program that is designed to
reimburse nonprofit U.S. agricultural trade organizations, nonprofit
state regional trade groups, state agencies, U.S. agricultural
cooperatives, and other entities that conduct approved foreign market
promotion activities. When considering applicant organizations, the CCC
will give priority to organizations that have the broadest producer
representation and affiliated industry participation of the commodity
being promoted. Eligible activities can be generic or branded in
nature. In order to be eligible for RAPP assistance, U.S. for-profit
entities shall be limited to those whose size does not exceed 300
percent of the small business size standards established for their
particular industry and published at 13 CFR part 121, Small Business
Size Regulations. Eligible for-profit entities may participate in a
RAPP Participant's brand promotion program. Any RAPP Participant that
operates a brand promotion program will be required to establish brand
program operational procedures. A RAPP Participant shall publicize its
RAPP program and make participation possible for commercial entities
throughout the relevant commodity sector or, in the case of State
Regional Trade Groups (SRTGs), throughout the corresponding region.
General Provisions
CCC will use the Unified Export Strategy (UES) internet-based
system to receive RAPP applications and to receive reimbursement
requests from RAPP Participants. This is the system used for the ATP
and similar CCC programs. Details about the application requirements
and process will be announced in the RAPP NOFOs.
CCC will evaluate each eligible proposal against the factors
described in the appropriate NOFO to identify those applications that
it considers to best meet the criteria and objectives outlined in the
NOFO. Based on its review and evaluation, CCC will, subject to the
availability of funds, recommend an appropriate funding level for each
proposal and submit the proposals and funding recommendations to the
appropriate officials for decision.
As with the ATP program, participants in the RAPP will be required
to contribute a total amount in goods, services, and/or cash equal to
at least 10 percent of the value of resources to be provided by the CCC
for all generic promotion activities proposed to be undertaken by the
RAPP Participant. Brand participants will also be required to
contribute an amount in goods, services, and/or cash equal to at least
50 percent of the cost of all brand promotion activities they undertake
under the RAPP.
This rule includes updated lists of expenses eligible and
ineligible for reimbursement under the RAPP. Procedures for requesting
reimbursement for eligible expenditures, or, if appropriate, for
advances of program funds, are described in the regulation. Because it
is critical that program funds are managed and accounted for properly
and are focused on achieving results, paragraphs regarding financial
management, reporting on outcomes that tie assistance directly to
increased trade, evaluation, and compliance review are included.
Finally, to ensure that funds provided under the RAPP are expended in a
cost-effective manner and are protected from fraud, CCC carries forward
the provisions regarding ethical conduct, contracting, and anti-fraud
requirements from the existing regulation.
Effective Date and Comments
This rule is effective upon publication in the Federal Register.
The Administrative Procedure Act (APA) (5 U.S.C. 553) provides that
notice and comment and a 30-day delay in the effective date of the rule
are not required when the rule involves specified actions, including
matters relating to grants or benefits. This rule establishes
procedures and conditions related to the provision of assistance to
entities conducting activities that promote U.S. agricultural
commodities in foreign markets and thus falls within the exemption to
the public participation requirements under the APA. Although not
required by the APA, CCC has chosen to accept comments on the rule and
may consider the comments when determining whether any changes to the
regulations are warranted in the future.
Executive Orders 12866 and 13563
Executive Order 12866, ``Regulatory Planning and Review,'' and
Executive Order 13563, ``Improving Regulation and Regulatory Review,''
direct agencies to assess all costs and benefits of available
regulatory alternatives and, if regulation is necessary, to select
regulatory approaches that maximize
[[Page 80094]]
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). Executive
Order 13563 emphasized the importance of quantifying both costs and
benefits of reducing costs, of harmonizing rules, and of promoting
flexibility.
This rule has been determined to be non-significant and, therefore,
was not reviewed by the Office of Management and Budget (OMB).
Regulatory Flexibility Act and Small Business Regulatory Enforcement
Fairness Act (SBREFA)
The Regulatory Flexibility Act (5 U.S.C. 601-612), as amended by
the SBREFA of 1996 (SBREFA, Pub. L. 104-121), generally requires an
agency to prepare a regulatory flexibility analysis of any rule
whenever an agency is required by the APA or any other law to publish a
proposed rule, unless the agency certifies that the rule will not have
a significant economic impact on a substantial number of small
entities. This rule is not subject to the Regulatory Flexibility Act
because the CCC is not required by the APA or any other law to publish
a proposed rule for this rulemaking. This rule is not a major rule
under SBREFA. SBREFA generally requires that an agency delay the
effective date of a major rule for 60 days from the date of publication
to allow for congressional review.
Environmental Assessment
The CCC has determined that the RAPP does not constitute a major
State or Federal action that would significantly affect the human or
natural environment. Consistent with the National Environmental Policy
Act (NEPA) (42 U.S.C. 4321-4347), no environmental assessment or
environmental impact statement will be prepared for this regulatory
action.
Executive Order 12372
Executive Order 12372, ``Intergovernmental Review of Federal
Programs,'' requires consultation with State and local officials that
would be directly affect by proposed Federal financial assistance. The
objectives of the Executive order are to foster an intergovernmental
partnership and a strengthened federalism, by relying on State and
local processes for State and local government coordination and review
of proposed Federal financial assistance and direct Federal
development. This program is subject to the requirements of Executive
Order 12372, ``Intergovernmental Review of Federal Programs,'' as
implemented under USDA's regulations at 2 CFR part 415, subpart C.
Executive Order 12988
This rule has been reviewed under Executive Order 12988, ``Civil
Justice Reform.'' This rule will not preempt State or local laws,
regulations, or policies unless they represent an irreconcilable
conflict with this rule. The rule will not have retroactive effect.
Before any judicial action may be brought regarding the provisions of
this rule, the administrative appeal provisions in this part must be
exhausted.
Executive Order 13132
This rule has been reviewed under Executive Order 13132,
``Federalism.'' The policies contained in this rule do not have any
substantial direct effect on States, on the relationship between the
Federal Government and the States, or on the distribution of power and
responsibilities among the various levels of government, except as
required by law. Nor does this rule impose substantial direct
compliance costs on State and local governments. Therefore,
consultation with the States is not required.
Executive Order 13175
This rule has been reviewed for compliance with Executive Order
13175, ``Consultation and Coordination with Indian Tribal
Governments.'' Executive Order 13175 requires Federal agencies to
consult and coordinate with tribes on a government-to-government basis
on policies that have Tribal implications, including regulations,
legislative comments, proposed legislation, and other policy statements
or actions that have substantial direct effects on one or more Indian
tribes, on the relationship between the Federal Government and Indian
tribes, or on the distribution of power and responsibilities between
the Federal Government and Indian tribes.
FAS has assessed the impact of this rule on Indian tribes and
determined that this rule does not, to the knowledge of FAS, have
Tribal implications that required Tribal consultation under Executive
Order 13175. If a tribe requests consultation, FAS will work with the
USDA Office of Tribal Relations to ensure meaningful consultation is
provided where changes, additions, and modifications identified herein
are not expressly mandated by Congress.
The Unfunded Mandates Reform Act of 1995
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA, Pub. L.
104-4) requires Federal agencies to assess the effects of their
regulatory actions on State local, and Tribal governments or the
private sector. Agencies generally must prepare a written statement,
including a cost benefit analysis, for proposed and final rules with
Federal mandates that may result in expenditures of $100 million or
more in any 1 year for State, local, or Tribal governments, in the
aggregate, or to the private sector. UMRA generally requires agencies
to consider alternatives and adopt the more cost effective or least
burdensome alternative that achieves the objectives of the rule. This
rule contains no Federal mandates, as defined in Title II of UMRA, for
State, local, and Tribal governments or the private sector. Therefore,
this rule is not subject to the requirements of sections 202 and 205 of
UMRA.
Federal Assistance Programs
The title and number of the Assistance Listing found in the System
for Award Management to which this rule applies is ``Regional
Agricultural Promotion Program''--10.618.
Paperwork Reduction Act of 1995
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C.
3501-3520), this rule does not change the information collection
approved by OMB under control number 0551-0049.
List of Subjects in 7 CFR Part 1489
Agricultural commodities, Exports.
0
Accordingly, the CCC revises 7 CFR part 1489 to read as follows:
PART 1489--REGIONAL AGRICULTURAL PROMOTION PROGRAM
Sec.
1489.10 General purpose and scope.
1489.11 Definitions.
1489.12 Participation eligibility.
1489.13 Application process.
1489.14 Application review and formation of agreements.
1489.15 Operational procedures for brand promotion programs.
1489.16 Contribution rules.
1489.17 Reimbursement rules.
1489.18 Reimbursement procedures.
1489.19 Advances.
1489.20 Financial management.
1489.21 Reports.
1489.22 Evaluation.
1489.23 Compliance reviews and notices.
1489.24 Failure to make required contribution.
1489.25 Submissions.
1489.26 Disclosure of program information.
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1489.27 Ethical conduct.
1489.28 Contracting procedures.
1489.29 Property standards.
1489.30 Anti-fraud requirements.
1489.31 Program income.
1489.32 Amendment.
1489.33 Noncompliance with an agreement or this part.
1489.34 Suspension, termination, and closeout of agreements.
1489.35 Paperwork reduction requirements.
Authority: 15 U.S.C. 714c(f).
Sec. 1489.10 General purpose and scope.
(a) This part sets forth the general terms, conditions, and
policies governing the Commodity Credit Corporation's (CCC) operation
of the Regional Agricultural Promotion Program (RAPP), which subsumes
the former Agricultural Trade Promotion Program (ATP). This program
will provide assistance to eligible organizations that conduct market
promotion activities, including activities to address existing or
potential non-tariff barriers to trade, to promote U.S. agricultural
commodities in certain foreign markets. Specific program requirements
will be set forth in Notices of Funding Opportunity (NOFO) announced
through the Grants.gov website.
(b)(1) In addition to the provisions of this part, other
regulations of general applicability issued by the U.S. Department of
Agriculture (USDA), including the regulations set forth in chapter XXX
of this title, may apply to the RAPP and RAPP Participants, to the
extent that the regulations of general applicability in this paragraph
(b)(1) do not directly conflict with the provisions of this part. The
regulations include, but are not limited to:
(i) 7 CFR part 1, subpart A.
(ii) 7 CFR part 3.
(iii) 7 CFR part 15, subpart A.
(iv) 2 CFR part 417.
(v) 2 CFR part 418.
(vi) 2 CFR part 421.
(vii) 48 CFR part 31.
(2) In addition, relevant provisions of the CCC Charter Act (15
U.S.C. 714 et seq.) and any other statutory provisions that are
generally applicable to the CCC are also applicable to the RAPP and the
regulations set forth in this part.
(3) RAPP Participants must also comply with Title VI of the Civil
Rights Act of 1964 and related civil rights regulations and policies.
(4) Other laws and regulations that apply to the RAPP and RAPP
Participants include, but are not limited to:
(i) 2 CFR part 25.
(ii) 2 CFR part 170.
(iii) 2 CFR part 175.
(iv) 2 CFR part 180.
(v) 2 CFR part 200.
(vi) 2 CFR part 400.
(vii) 37 CFR 401.1.
(viii) Executive Order 13224, as amended, ``Blocking Property and
Prohibiting Transactions with Persons Who Commit, Threaten to Commit,
or Support Terrorism.''
(c) Under the RAPP, the CCC may provide multi-year grant assistance
to eligible U.S. entities to conduct certain marketing and promotion
activities, including activities to address existing or potential non-
tariff trade barriers, aimed at developing, maintaining, or expanding
commercial export markets for U.S. agricultural commodities. RAPP
Participants may receive assistance for either generic or brand
promotion activities. While activities generally take place overseas,
reimbursable activities may also take place in the United States. The
CCC expects that all activities that occur in the United States for
which RAPP reimbursement is sought will develop, maintain, or expand
the commercial export market for the relevant eligible commodity in
accordance with the RAPP Participant's approved RAPP program.
(d) The RAPP generally operates on a reimbursement basis.
(e) The CCC's policy is to ensure that benefits generated by RAPP
agreements are broadly available throughout the relevant agricultural
sector and that no single entity gains an undue advantage. The CCC also
endeavors to enter into RAPP agreements covering a broad array of
agricultural commodity sectors. The RAPP is administered by personnel
of the Foreign Agricultural Service (FAS) acting on behalf of the CCC.
Sec. 1489.11 Definitions.
For purposes of this part the following definitions apply:
Activity means a specific foreign market development effort
undertaken by a RAPP Participant.
Administrative expenses or costs means expenses or costs of
administering, directing, and controlling an organization that is a
RAPP Participant. Generally, this would include expenses or costs such
as those related to:
(1) Maintaining a physical office (including, but not limited to:
rent, office equipment, office supplies, computer hardware and
software, office maintenance);
(2) Personnel (including, but not limited to, salaries, benefits,
payroll taxes, individual insurance, training);
(3) Communications (including, but not limited to, phone expenses,
internet, mobile phones, mobile phone service postage, courier
services, television, radio, walkie talkies);
(4) Management of an organization or unit of an organization
(including, but not limited to, planning, supervision, supervisory
travel, recruiting, hiring);
(5) Utilities (including, but not limited to, sewer, water, energy,
Wi-Fi); and
(6) Professional services (including, but not limited to,
accounting expenses, financial services, investigatory services).
Approval letter means a document by which the CCC informs an
applicant that its RAPP application has been approved for funding. This
letter may also approve specific activities and contain terms and
conditions in addition to the program agreement. This letter requires a
countersignature by the RAPP Participant before it becomes effective.
Attach[eacute]/Counselor means the FAS employee representing USDA
interests in the foreign country in which promotional activities are
conducted.
Brand participant means a U.S. for-profit entity that owns the
brand(s) of the eligible commodity to be promoted (or has the exclusive
rights to use such brand(s)) and that is participating in the RAPP
brand promotion program of another RAPP Participant. This definition
does not include any U.S. agricultural cooperatives.
Brand promotion means an activity that involves the exclusive or
predominant use of a single U.S. company name, or the logo or brand
name of a single U.S. company, or the brand of a U.S. agricultural
cooperative, or any activity undertaken by a brand participant in a
brand program.
Budget period means the period during which a RAPP Participant can
undertake activities consistent with this part and its program
agreement and approval letter with CCC. Budget periods will be
specified in a RAPP Participant's approval letter.
CCC means the Commodity Credit Corporation, including any agency or
official of the United States delegated the responsibility to act on
behalf of the CCC.
Constraint means a condition in a particular country or region that
needs to be addressed in order to develop, expand, or maintain exports
of a specific eligible commodity.
Contribution means an expenditure made by a RAPP Participant, the
U.S. industry, or a State agency in support of an approved activity.
This includes expenditures to be made by entities in the RAPP
Participant's industry in support of the entities' related promotion
activities in the markets
[[Page 80096]]
covered by the RAPP Participant's agreement.
Credit memo means a commercial document, also known as a credit
memorandum, issued by the RAPP Participant to a commercial entity that
owes the RAPP Participant a certain sum. A credit memo is used when the
RAPP Participant owes the commercial entity a sum less than the amount
the entity owes the Participant. The credit memo reflects an offset of
the amount the RAPP Participant owes the entity against the amount the
entity owes to the RAPP Participant.
Demonstration projects means activities involving the erection or
construction of a structure or facility or the installation of
equipment.
Eligible commodity means any U.S. agricultural commodity or product
thereof, excluding tobacco, that is comprised of at least 50 percent by
weight, exclusive of added water, of agricultural commodities grown or
raised in the United States.
Expenditure means either payment made by a RAPP participant via the
transfer of funds or an offset reflected in a credit memo in lieu of a
transfer of funds.
FAS means Foreign Agricultural Service, USDA.
FAS website means a website maintained by FAS providing information
on RAPP. It is currently accessible at https://fas.usda.gov/programs/regional-agricultural-promotion-program.
Foreign third party means a foreign entity that a RAPP Participant
works with to promote the export of an eligible commodity under the
RAPP program.
Generic promotion means an activity that is not a brand promotion
but, rather, promotes an eligible commodity generally. A generic
promotion activity may include the promotion of a foreign brand (i.e.,
a brand owned primarily by foreign interests and being used to market a
commodity or product in a foreign market), if the foreign brand uses
the promoted eligible commodity from multiple U.S. suppliers. A generic
promotion activity may also involve the use of specific U.S. company
names, logos, or brand names. However, in that case, the RAPP
Participant must ensure that all U.S. companies seeking to promote such
eligible commodity in the market have an equal opportunity to
participate in the activity and that at least two U.S. companies
participate. In addition, an activity that promotes separate items from
multiple U.S. companies will be considered a generic promotion only if
the promotion of the separate items maintains a unified theme (i.e., a
dominant idea or motif) and style and is subordinate to the promotion
of the generic theme.
Market means the country or countries targeted by an activity.
Notification means a document from the RAPP Participant by which
the RAPP Participant proposes to CCC changes to the activities and/or
funding levels in an approved RAPP program agreement and/or approval
letter.
Period of performance means the total time interval between the
start of a RAPP award and the planned end date, which may include one
or more funded portions, or budget periods. A RAPP award's period of
performance will be defined by the dates contained in the program
agreement.
Product samples means a representative part of a larger whole
promoted commodity or group of promoted commodities. Product samples
include all forms of a promoted commodity (e.g., fresh or processed),
independent of the ultimate utilization of the sample. Product samples
must be used in support of international marketing activities
including, but not limited to, displays, food process testing, cooking
demonstrations, or trade and consumer tastings.
Program agreement means a document entered into between CCC and a
RAPP Participant setting forth the terms and conditions of approved
activities under RAPP, including any subsequent amendments to such
agreement.
Promoted commodity means an eligible commodity the sale of which is
the intended result of a promotional activity.
RAPP means the Regional Agricultural Promotion Program.
RAPP notice means Regional Agricultural Promotion Program notices,
which are documents that CCC issues for informational purposes. These
RAPP notices are made available electronically on the FAS website.
These notices have no legal effect. They are intended to alert RAPP
Participants to various aspects of CCC's current administration of the
RAPP program.
RAPP Participant or Participant means an entity that has entered
into a RAPP program agreement with the CCC.
Sales and trade relations expenditures (STRE) means expenditures
made on breakfast, lunch, dinner, receptions, and refreshments at
approved activities; miscellaneous courtesies such as checkroom fees,
taxi fares and tips for approved activities; and decorations for a
special promotional occasion that is part of an approved activity.
Sales team means a group of individuals engaged in an approved
activity intended to result in specific sales.
SRTG means State Regional Trade Group. An SRTG is a nonprofit
association of State-funded agricultural promotion agencies.
Temporary contractor means a contractor, typically a consultant or
other highly paid professional, that is hired on a short-term basis to
assist in the performance of an activity.
Trade team means a group of individuals engaged in an approved
activity intended to promote the interests of an entire agricultural
sector rather than to result in specific sales by any of its members.
UES website means a website maintained by FAS through which
applicants may apply and are reimbursed for RAPP and other USDA market
development programs. The website is currently accessible to persons
with e-authentication certification at https://apps.fas.usda.gov/ues/webapp/. FAS may prescribe a different system through which applicants
may apply to the RAPP and will announce such system in the applicable
NOFO.
Unified Export Strategy (UES) means a standardized online internet
application developed by USDA and available for use by entities to
apply to USDA market development programs, including the RAPP.
U.S. agricultural commodity means any agricultural commodity of
U.S. origin, including food, feed, fiber, forestry product, livestock,
insects, and fish harvested from a U.S. aquaculture farm or harvested
by a vessel (as defined in title 46 of the United States Code) in
waters that are not waters (including the territorial sea) of a foreign
country, and any product thereof.
USDA means the United States Department of Agriculture.
U.S. for-profit entity means a firm, association, or other entity
organized or incorporated, located, and doing business for profit in
the United States, and engaged in the export or sale of an eligible
commodity.
Sec. 1489.12 Participation eligibility.
(a) To participate in the RAPP as a RAPP Participant, an entity
must be:
(1) A nonprofit U.S agricultural trade organization;
(2) A nonprofit SRTG;
(3) A U.S. agricultural cooperative; or
(4) A State agency.
(b) CCC will enter into an agreement only for the promotion of an
eligible commodity.
(c) FAS may set forth specific eligibility information, including
any factors or priorities that will affect the
[[Page 80097]]
eligibility of an applicant or application for selection, in the full
text of the applicable NOFO posted on the U.S. Government website for
grant opportunities.
Sec. 1489.13 Application process.
(a) General application requirements. CCC will periodically issue a
NOFO through the Grants.gov website announcing that it is accepting
applications for participation in the RAPP. Applications shall be
submitted in accordance with the terms and requirements specified in
the NOFO and in this part. Applicants may apply to conduct a generic
promotion program and/or a brand promotion program that provides RAPP
funds to brand participants for brand promotion, as well as to conduct
other market promotion activities, including activities to address
existing or potential non-tariff trade barriers. An applicant that is a
U.S. agricultural cooperative may also apply for funds to conduct its
own brand promotion program.
(b) Requests for evaluation information. CCC may request any
information that it deems necessary to evaluate an application,
including, but not limited to, performance measurement information.
Applicants shall provide any requested information in the manner and
according to the timeframe specified by CCC.
(c) Special rules governing demonstration projects funded with CCC
resources. CCC will consider proposals for demonstration projects,
provided:
(1) No more than one such demonstration project per constraint is
undertaken within a market;
(2) The constraint to be addressed in the target market is a lack
of technical knowledge or expertise;
(3) The demonstration project is a practical and cost-effective
method of overcoming the constraint; and
(4) A third party must participate in such project through a
written agreement with the RAPP Participant.
(d) Universal identifier and System for Award Management (SAM). In
accordance with 2 CFR part 25, each entity that applies to the RAPP
program and does not qualify for an exemption under 2 CFR 25.110 must:
(1) Be registered in SAM prior to submitting an application or
plan;
(2) Maintain an active SAM registration with current information at
all times during which it has an active Federal award or an application
or plan under consideration by CCC; and
(3) Provide its unique identifier in each application or plan it
submits to CCC.
(e) Reporting subaward and executive compensation information. In
accordance with 2 CFR part 170, each entity that applies to the RAPP
program and does not qualify for an exception under 2 CFR 170.110(b)
must ensure it has the necessary processes and systems in place to
comply with the applicable reporting requirements of 2 CFR part 170
should it receive RAPP funding.
Sec. 1489.14 Application review and formation of agreements.
(a) General. (1) CCC will review all proposals for eligibility and
completeness. CCC will evaluate each eligible proposal against the
factors described in the appropriate NOFO to identify those
applications that it considers to best meet the criteria and objectives
outlined in the NOFO. Based on its review and evaluation, CCC will,
subject to the availability of funds, recommend an appropriate funding
level for each proposal and submit the proposals and funding
recommendations to the appropriate officials for decision. CCC may,
when appropriate to the subject matter of the proposal, request the
assistance of other U.S. Government experts in evaluating a proposal.
All reviewers will be required to sign a conflict-of-interest form, and
when conflicts of interests are identified the reviewer will be recused
from the objective review process.
(2) When considering applicant organizations, CCC may give priority
to those organizations that have the broadest producer representation
and affiliated industry participation of the commodity being promoted,
as determined by CCC. CCC may require that an applicant participate in
the RAPP through another RAPP Participant or applicant.
(3) CCC will approve those applications that it determines best
satisfy the criteria and factors specified in the NOFO.
(4) CCC will notify each applicant in writing of the final
disposition of its application.
(b) Formation of agreements. CCC will send a program agreement (or
amendment to an existing program agreement), an approval letter, and a
signature card to each approved applicant. The program agreement or
amendment and the approval letter will outline which activities and
budgets are approved and will specify any special terms and conditions
applicable to a RAPP Participant's program, including any requirements
with respect to contributions and program evaluations. An applicant
that decides to accept the terms and conditions contained in the
program agreement or amendment and the approval letter must so indicate
by having the appropriate personnel sign the program agreement or
amendment and the approval letter and submit these to CCC. Final
agreement shall occur when the program agreement or amendment and the
approval letter are signed by both parties.
(c) Signature cards. The RAPP Participant is encouraged to
designate at least two individuals in its organization to sign program
agreements and amendments, approval letters, reimbursement claims, and
advance requests. The RAPP Participant shall submit the signature card
signed by those designated individuals and by the RAPP Participant's
Chief Executive Officer (or designee) to CCC. The Participant shall
immediately notify CCC in writing of any changes in signatories and
shall submit a revised signature card accordingly.
(d) UES ID and passwords. CCC will provide each RAPP Participant
with IDs and passwords for the UES website, as necessary. RAPP
Participants shall immediately notify CCC whenever a person who
possesses the ID and password information no longer needs such
information, or when a person who is not authorized gains such
information.
(e) Annual certifications. A RAPP Participant through which U.S.
for-profit entities are participating in the RAPP program shall obtain
annual certifications from all such entities that certify their size,
as defined in this part. The Participant shall retain these
certifications in accordance with the recordkeeping requirements of
this part.
(f) Changes to activities and funding--(1) Adding a new activity.
(i) A RAPP Participant may not conduct a new activity without first
obtaining an approved activity budget for such change. To request
approval of such activity budget, the RAPP Participant shall submit a
notification to CCC.
(ii) A notification for a new activity shall provide an activity
justification and identify any related adjustments to the approved
strategic plan, including changes in the market, constraint, or
opportunity that the activity proposes to address. The notification
shall contain the activity description and the proposed budget.
(iii) After receipt of the notification, CCC will inform the RAPP
Participant via the UES website whether the requested budget is
approved.
(2) Modifying existing activities and their funding levels. (i) A
RAPP Participant desiring to increase the funding level for existing,
approved activities addressing a single constraint or opportunity by
more than $25,000 or
[[Page 80098]]
25 percent of the approved funding level, whichever is greater, must
first submit a notification explaining the adjustment to CCC before
making such change.
(ii) A RAPP Participant may make significant adjustments below
$25,000 or 25 percent of the approved funding level, whichever is
greater, to the funding levels for existing, approved activities
without prior notification to CCC, but only if it submits a
notification explaining the adjustments to CCC no later than 30 days
after the change. Minor adjustments to existing, approved activities
and/or funding levels do not require notification.
(iii) Notifications shall describe the activity, changes to the
activity, the existing funding level, the proposed funding level, and a
justification for transfer of funds, if applicable.
Sec. 1489.15 Operational procedures for brand promotion programs.
(a) Where CCC approves an application by a RAPP Participant to run
a brand promotion program that will include brand participants, the
RAPP Participant shall establish brand program operational procedures.
The RAPP Participant shall submit to CCC for approval its proposed
brand program operational procedures. CCC will notify all RAPP
Participants in writing in each Participant's approval letter as to
applicable submission dates for and dates for approvals of brand
program operation procedures. Such procedures shall include, at a
minimum, a brand program application, application procedures,
application review criteria, brand participant eligibility
requirements, a participation agreement, reimbursement requirements,
compliance requirements, reporting and recordkeeping requirements,
employment practices, financial management requirements, contracting
procedures, and evaluation requirements. The RAPP Participant must
submit to CCC for approval any proposed changes to already approved
brand program operational procedures before implementing such proposed
changes.
(b) The RAPP Participant shall not enter into any participation
agreements with brand participants, nor shall it implement any RAPP
brand activities, unless and until CCC has communicated in writing its
approval of the proposed operational procedures to the RAPP
Participant.
(c) Where CCC approves a RAPP Participant's application to run a
brand promotion program that will include brand participants, the RAPP
Participant shall enter into participation agreements with brand
participants. Brand participants' size may not exceed 300 percent of
the applicable small business size standard as found in 13 CFR part
121. These agreements must:
(1) Specify a time period for such brand promotion and require that
all brand promotion expenditures be made within the RAPP Participant's
approved budget period;
(2) Make no allowance for extension or renewal;
(3) Limit reimbursable expenditures to those made in countries and
for activities approved in the brand participant's activity plan;
(4) Specify the percentage of promotion expenditures that will be
reimbursed, reimbursement procedures, and documentation requirements;
(5) Include a written certification by the brand participant that
it either owns the brand of the product it will promote or has
exclusive rights to promote the brand in each of the countries in which
promotion activities will occur;
(6) Require that all product labels, promotional material, and
advertising will identify the origin of the eligible commodity as
``American'', ``Product of the United States of America'', ``Product of
the U.S.'', ``Product of the U.S.A.'', ``Product of America'', ``Grown
in the United States of America'', ``Grown in the U.S.'', ``Grown in
the U.S.A.'', ``Grown in America'', ``Made in the United States of
America,'' ``Made in the U.S.'', ``Made in the U.S.A.'', ``Made in
America'', or product of, grown in or made in any state or territory of
the United States of America spelled out in its entirety, or other U.S.
regional designation if approved in advance by the CCC; that such
origin identification will be conspicuously displayed in a manner
easily observed as identifying the origin of the product; and that such
origin identification will conform, to the extent possible, to the U.S.
standard of \1/6\ inch (.42 centimeters) in height based on the lower
case letter ``o''. The use of the above terms as a descriptor or in the
name of the product (e.g., Cincinnati style chili, Gina's American
Pizza) does not satisfy the product origin requirement. Phrases
``product of'', ``grown in'' or ``made in'' are encouraged, but not
required. A RAPP Participant that wishes to use an origin statement
that varies from those set out in this subsection must submit the
proposed statement to CCC for review and must receive approval to use
the statement before its use in an activity. A RAPP Participant may
request an exemption from this requirement on a case-by-case basis. All
such requests shall be in writing and include justification
satisfactory to the CCC that the labeling requirement in this paragraph
(c)(6) would hinder a RAPP Participant's promotional efforts. CCC will
determine, on a case-by-case basis, whether sufficient justification
exists to grant an exemption from the labeling requirement. In
addition, the CCC may temporarily waive this requirement where the CCC
has determined that such labeling will likely harm sales rather than
help them. Such determinations will be announced to RAPP Participants
via a RAPP notice issued on the FAS website;
(7) Include a written certification by the brand participant that
identifies its size on the date of its application for branded program
funding, or that it is a U.S. agricultural cooperative;
(8) Require that the brand participant submit to the RAPP
Participant a statement certifying that any Federal funds received will
supplement, but not supplant, any private or third-party funds or other
contributions to program activities; and
(9) Require the brand participant to maintain all original records
and documents relating to program activities for three calendar years
following the end of the applicable budget period and make such records
and documents available upon request to authorized officials of the
U.S. Government.
Sec. 1489.16 Contribution rules.
(a) In RAPP generic promotion programs, a RAPP Participant shall
contribute a total amount in goods, services, and/or cash equal to at
least 10 percent of the value of resources provided by the CCC for all
generic promotion activities undertaken by the RAPP Participant.
(b) In RAPP brand promotion programs, a RAPP Participant conducting
its own brand promotion or a brand participant that is participating in
the RAPP brand promotion program of another RAPP Participant shall
contribute at least 50 percent of the total eligible expenditures
submitted in accordance with Sec. 1489.17 made on each approved brand
promotion.
(c) A RAPP Participant must use its own funds and may not use RAPP
program funds to pay any administrative costs of the RAPP Participant's
U.S. office(s), including legal fees, except as set forth in this part.
Where the RAPP Participant uses its own funds to pay for administrative
costs, such costs may be counted in calculating the amount of
contributions the RAPP Participant contributes to RAPP generic or brand
promotion programs.
(d) Regarding eligible contributions:
[[Page 80099]]
(1) In calculating the amount of contributions that it will make,
and the contributions that the U.S. industry (including expenditures to
be made by entities in the applicant's industry or agricultural sector
in support of the entities' related promotion activities in the markets
covered by the applicant's application) or State agency will make, the
RAPP applicant may include the costs listed under paragraph (d)(2) of
this section if such expenditures:
(i) Are necessary and reasonable for accomplishment of an approved
activity;
(ii) Are not included as contributions for any other Federal award;
and
(iii) Are not paid by the Federal Government under another Federal
award, except where the Federal statute authorizing a program
specifically provides that Federal funds made available for such
program can be applied to the matching or cost sharing requirements of
other Federal programs.
(2) Subject to paragraph (d)(1) of this section, as well as the
cost principles in 2 CFR part 200 to the extent these principles do not
directly conflict with the provisions of this part, eligible
contributions are:
(i) Cash;
(ii) Compensation paid to personnel;
(iii) The cost of acquiring materials, supplies or services;
(iv) The cost of office space;
(v) A reasonable and justifiable proportion of general
administrative costs and overhead;
(vi) Payments for indemnity and fidelity bond expenses;
(vii) The cost of business cards that target a foreign audience;
(viii) The cost of subscriptions that are of a technical, economic,
or marketing nature and that are relevant to the approved activities of
the RAPP Participant;
(ix) The cost of activities conducted overseas;
(x) Credit card fees;
(xi) The cost of any independent evaluation or audit that is not
required by the CCC to ensure compliance with program agreement or
regulatory requirements;
(xii) The cost of giveaways, awards, prizes and gifts;
(xiii) The cost of product samples;
(xiv) Fees for participating in U.S. Government-sponsored or
endorsed export promotion activities;
(xv) The cost of air and local travel in the United States;
(xvi) STRE and the costs associated with trade shows, seminars, and
entertainment conducted in the United States where the STRE and costs
associated with trade shows, seminars, and entertainment have a
programmatic purpose and are authorized in the program agreement and/or
the approval letter or authorized by prior written approval of the CCC;
(xvii) Other administrative expenses (e.g., supervisory travel from
the U.S. to an overseas office); and
(xviii) The cost of any activity expressly listed as reimbursable
in this part.
(3) The following are not eligible contributions:
(i) Any portion of salary or compensation of an individual who is
the target of an approved promotional activity;
(ii) Any expenditure, including that portion of salary and time
spent, related to promoting membership in the Participant organization
(sometimes referred to in the industry as ``backsell'');
(iii) Any land costs other than allowable costs for office space;
(iv) The cost of refreshments and related equipment provided to
office staff;
(v) The cost of insuring articles owned by private individuals;
(vi) The cost of any arrangement that has the effect of reducing
the selling price of a U.S. agricultural commodity;
(vii) The cost of product development, product modifications, or
product research, except as described in Sec. 1489.17(c)(22);
(viii) Slotting fees or similar sales expenditures;
(ix) Membership fees in clubs and social organizations; and
(x) Any expenditure for an activity prior to the CCC's approval of
that activity.
(4) The CCC shall determine, at the CCC's discretion, whether any
cost not expressly listed in this section may be included by the RAPP
Participant as an eligible contribution.
Sec. 1489.17 Reimbursement rules.
(a) A RAPP Participant may seek reimbursement for an eligible
expenditure if:
(1) The expenditure was necessary and reasonable for the
accomplishment of an approved RAPP activity; and
(2) The Participant has not been and will not be reimbursed for
such expenditure by any other source.
(b) Subject to paragraphs (a) and (d) of this section, as well as
the cost principles in 2 CFR part 200 to the extent these principles do
not directly conflict with the provisions of this part, for either
brand or generic promotion activities, the CCC will reimburse, in whole
or in part, the costs of:
(1) Production and placement of advertising, in print, electronic
media, billboards, or posters, which may include advertising the
availability of price discounts, except that advertising associated
with a coupon or price discount for the RAPP-promoted product is not
reimbursable. If advertising is related to both coupons or price
discounts for products other than the RAPP Participant's promoted
products as well as for RAPP-promoted products, then expenditures for
such advertising will not be reimbursed in whole or in part (e.g.,
expenditures may not be prorated and submitted for reimbursement).
Electronic media include, but are not limited to, radio, television,
electronic mail, internet, telephone, text messaging, social media, and
podcasting.
(2) Production and distribution of banners, recipe cards, table
tents, shelf talkers, and other similar point of sale materials.
(3) Direct mail advertising.
(4) In-store and food service promotions, product demonstrations to
the trade and to consumers, and distribution of product samples (but
not the purchase of the product samples, except as authorized in
paragraph (c)(9) of this section).
(5) Temporary displays and rental of space for temporary displays.
(6) Expenditures, other than travel expenditures, associated with
seminars and educational training, whether conducted in the United
States or outside the United States.
(7) Subject to paragraph (b)(18) of this section, expenditures,
other than travel expenditures, associated with retail, trade and
consumer exhibits and shows, whether held outside or inside the United
States, including participation fees, booth construction,
transportation of related materials, rental of space and equipment, and
duplication of related printed materials. However, with regard to non-
travel expenditures associated with retail, trade and consumer exhibits
and shows held inside the United States, such expenditures are
reimbursable only if the exhibit or show is: a food or agricultural
show with no less than 30 percent of exhibitors selling food or
agricultural products; and, an international show that targets buyers,
distributors and the like from more than one foreign country and no
less than 15 percent of its visitors are from outside the U.S. CCC will
compile a list of approved retail, trade and consumer exhibits and
shows held inside the United States for which RAPP reimbursement is
available, and such list will be announced to RAPP Participants via a
RAPP notice issued on FAS' website.
[[Page 80100]]
(8) Subject to paragraph (b)(18) of this section, international
travel expenditures, not to exceed the full fare economy rate,
including any fees for modifying the originally purchased airline
ticket, per diem, passports, visas and inoculations, as allowed under
the U.S. Federal Travel Regulations (41 CFR parts 301 through 304) and
2 CFR part 200, for no more than two representatives of a single brand
participant (or RAPP Participant directly running its own brand
program) to exhibit their company's (or cooperative's) products at a
retail, trade, or consumer exhibit or show held outside the United
States. Representatives may include employees and board members of
private companies, employees or members of cooperatives, or any broker,
consultant, or marketing representative contracted by the company or
cooperative to represent the company or cooperative in sales
transactions. All travel should follow a direct or usually traveled
route.
(9) Subscriptions that are of a technical, economic, or marketing
nature and that are relevant to the approved activities of the RAPP
Participant.
(10) Demonstrators, interpreters, translators, receptionists, and
similar temporary workers who help with the implementation of
individual promotional activities, such as trade shows, in-store
promotions, food service promotions, and trade seminars.
(11) Giveaways, awards, prizes, gifts and other similar promotional
materials, subject to such reimbursement limitation as CCC may
determine and announce in writing to RAPP Participants via a RAPP
notice issued on FAS' website. Reimbursement is available only when:
(i) The items are described in detail with a per unit cost in an
approved strategic plan; and
(ii) Distribution of the promotional item is not contingent upon
the consumer, or other target audience, purchasing a good or service to
receive the promotional item.
(12) The design and production of packaging, labeling or origin
identification, to be used during the budget period in which the
expenditure is made, if such packaging, labeling or origin
identification is necessary to meet the importing requirements of a
foreign country.
(13) The design, production, and distribution of coupons for
products other than the RAPP Participant's promoted products. If such
activities include both coupons or price discounts for products other
than the RAPP Participant's promoted products as well as for RAPP-
promoted products, then expenditures for such activities will not be
reimbursed in whole or in part (e.g., expenditures may not be prorated
and submitted for reimbursement).
(14) An audit of a RAPP Participant as required by 2 CFR part 200,
subpart F, if the RAPP is the RAPP Participant's largest source of
Federal funding.
(15) The translation of written materials as necessary to carry out
approved activities.
(16) Expenditures associated with developing, updating, and
servicing websites on the internet that clearly target a foreign
audience.
(17) International travel expenditures, not to exceed the full fare
economy rate, including any fees for modifying the originally purchased
airline ticket, per diem, passports, visas and inoculations, as allowed
under the U.S. Federal Travel Regulations (41 CFR parts 301 through
304) and 2 CFR part 200, incurred for a foreign trade mission conducted
outside the United States that is an activity under an approved branded
program and that has met the following conditions:
(i) Trade mission travel for company (or cooperative)
representatives was identified as a separate approved activity in the
RAPP Participant's UES;
(ii) The trade mission included representatives, as defined in
paragraph (b)(8) of this section, from a minimum of five different
companies (or cooperatives), and no more than two representatives from
each participating company (or cooperative);
(iii) The appropriate FAS overseas office supported the trade
mission by dedicating meaningful funding or other resources (such as
facilities or staff time) to the activity; and
(iv) The RAPP Participant with the approved brand program produced
an itinerary or agenda for the trade mission that demonstrated that
company (or cooperative) representatives would be engaged for a minimum
of 6 hours per day (except for the first and last days of the mission)
in trade mission activities that include, at a minimum, each of the
following:
(A) A product showcase where the FAS overseas office approved an
invitation list of qualified buyers;
(B) Pre-arranged one-on-one business meetings; and
(C) Evaluation and feedback sessions with FAS staff and trade
mission sponsors.
(v) Reimbursement is conditional on the RAPP Participant having
notified in writing the Attach[eacute]/Counselor in the destination
country in advance of the travel to that country or region. All travel
should follow a direct or usually traveled route.
(18) Where USDA has sponsored or endorsed a U.S. pavilion at a
retail, trade and consumer exhibit or show, whether held outside or
inside the United States, RAPP funds may be used to reimburse the
travel and/or non-travel expenditures of only those RAPP Participants
located within the U.S. pavilion. Such expenditures must also adhere to
the standard terms and conditions of the U.S. pavilion organizer. All
travel should follow a direct or usually traveled route. Upon written
request, the CCC may temporarily waive this subsection, on a case-by-
case basis, where:
(i) The trade show is segregated into product pavilions; or
(ii) A company's distributor or importer is located outside the
U.S. pavilion. Such waiver will be provided to the RAPP Participant in
writing.
(19) Contracts with U.S.-based organizations when the only
contracted service such organizations provide to a RAPP Participant is
carrying out a specific market promotion activity in the United States
directed to a foreign audience (e.g., a trade mission of foreign buyers
coming to the United States to visit U.S. exporters). Such contracts
may be reimbursable as a direct promotional expense. If a U.S.-based
organization provides administrative services to the RAPP Participant's
domestic home office during a budget period, any direct promotional
services such organization provides to the Participant, whether for the
Participant's domestic or overseas offices, during the same budget
period are not reimbursable.
(c) Subject to paragraphs (a) and (d) of this section as well as
the cost principles in 2 CFR part 200 to the extent these principles do
not directly conflict with the provisions of this part, but for generic
promotion activities only, the CCC will also reimburse, in whole or in
part, the cost of:
(1) Temporary contractor fees for contractors stationed overseas,
except the CCC will not reimburse any portion of any such fee that
exceeds the daily gross salary of a GS-15, Step 10 for U.S. Government
employees in effect on the date the fee is earned, unless a bidding
process reveals that such a contractor is not available at or below
that salary rate.
(2) Subject to paragraph (b)(18) of this section, international
travel expenditures, not to exceed the full fare economy rate,
including any fees for modifying the originally purchased airline
ticket, per diem, passports, visas, and inoculations, for activities
held outside the United States or in the United States, as allowed
under the U.S.
[[Page 80101]]
Federal Travel Regulations (41 CFR parts 301 through 304) and 2 CFR
part 200, except that if the activity is participation in a retail,
trade, or consumer exhibit or show held inside the United States, then
international travel expenditures are covered only if the exhibit or
show is: a food or agricultural show with no less than 30 percent of
exhibitors selling food or agricultural products; and, an international
show that targets buyers, distributors and the like from more than one
foreign country and no less than 15 percent of its visitors are from
countries other than the United States. The CCC will compile a list of
approved retail, trade, and consumer exhibits and shows held inside the
United States for which RAPP reimbursement is available, and such list
will be announced to RAPP Participants via a RAPP notice issued on FAS'
website.
(i) The CCC generally will not reimburse any portion of air travel,
including any fees for modifying the originally purchased ticket, in
excess of the full fare economy rate or when the RAPP Participant fails
to notify the Attach[eacute]/Counselor in the destination country in
advance of the travel to that country or region, unless the CCC
determines it was impractical to provide such notice. If a traveler
flies in business class or a different premium class, the basis for
reimbursement will be the full fare economy class rate for the same
flight and the RAPP Participant shall provide documentation
establishing such full fare economy class rate to support its
reimbursement claim. If economy class is not offered for the same
flight or if the traveler flies on a charter flight, the basis for
reimbursement will be the average of the full fare economy class rate
for flights offered by three different airlines between the same points
on the same date, and the RAPP Participant shall provide documentation
establishing such average of the full fare economy class rates to
support its reimbursement claim.
(ii) In limited circumstances, the RAPP Participant may be
reimbursed for air travel up to the business class rate (i.e., a
premium class rate other than the first class rate) upon prior written
approval by the CCC. Such circumstances are:
(A) Regularly scheduled flights between origin and destination
points do not offer economy class (or equivalent) airfare, and the RAPP
Participant receives written documentation from its travel agent to
that effect at the time the tickets are purchased;
(B) Business class air travel is necessary to accommodate an
eligible traveler's disability. Such disability must be substantiated
in writing by a physician; and
(C) If an eligible traveler is an employee, contractor, or member
of a RAPP participant organization, and the eligible traveler's origin
and/or destination are outside of the continental United States and the
scheduled flight time, beginning with the scheduled departure time,
ending with the scheduled arrival time, and including stopovers and
changes of planes, exceeds 14 hours. In such case, per diem and other
allowable expenses will also be reimbursable for the day of arrival.
However, no expenses will be reimbursable for a rest period or for any
non-work days (e.g., weekends, holidays, personal leave, etc.)
immediately following the date of arrival.
(D) If an eligible traveler is the target of a market development
activity (e.g., a foreign buyer, foreign importer, member of the
foreign media), then the RAPP Participant may be reimbursed for air
travel up to the business class rate when the eligible traveler's
origin and/or destination are outside of the continental United States
and the scheduled flight time, beginning with the scheduled departure
time, ending with the scheduled arrival time, and including stopovers
and changes of planes, exceeds five hours. In such cases, per diem and
other allowable expenses will also be reimbursable for the day of
arrival. However, no expenses will be reimbursable for a rest period or
for any non-work days (e.g., weekends, holidays, personal leave, etc.)
immediately following the date of arrival.
(iii) Alternatively, in lieu of reimbursing up to the business
class rate in such circumstances noted in paragraphs (c)(2)(ii)(C) and
(D) of this section, the CCC will reimburse economy class airfare plus
per diem and other allowable travel expenses related to a rest period
of up to 24 hours, either en route or upon arrival at the destination.
For a trip with multiple destinations, each origin/destination
combination will be considered separately when applying the 14-hour
rule for eligibility of reimbursement of business class travel or rest
period expenses.
(iv) A stopover for purposes of this paragraph (c)(2) is the time a
traveler spends at an airport, other than the originating or
destination airport, which is a normally scheduled part of a flight. A
change of planes is the time a traveler spends at an airport, other
than the originating or destination airport, to disembark from one
flight and embark on another.
(v) All travel under this paragraph (c)(2) should follow a direct
or usually traveled route. Under no circumstances should a traveler
select flights in a manner that extends the scheduled flight time to
beyond 14 hours in part to secure eligibility for reimbursement of
business class travel. An eligible traveler that is the target of a
market development activity is only eligible for a rest period when
that traveler flies in economy class and meets the 14-hour test.
(3) Automobile mileage at the local U.S. Embassy rate or rental
cars while in travel status.
(4) Other allowable expenditures while in travel status as
authorized by the U.S. Federal Travel Regulations (41 CFR parts 301
through 304) and 2 CFR part 200.
(5) Accident liability insurance premiums for facilities used
jointly with third-party participants for RAPP activities or for RAPP-
funded travel of third-party participants, provided the types and
extent and cost of coverage are in accordance with the RAPP
Participant's policy and sound business practice.
(6) Market research, including research to determine the types of
products that are desired in a market.
(7) Legal fees incurred in resolving trade issues with foreign
countries.
(8) The sample purchase price, and the cost of transporting samples
domestically in the United States to the port of export and then to the
first foreign port or first point of entry, for samples of eligible
commodities used to provide on-site technical assistance to the trade
necessary to facilitate successful use of the relevant eligible
commodity by importers. The target of such activity must be the trade,
and not consumers, but any product resulting from the technical
training can be used to determine consumer preferences.
(9) STRE incurred outside of the United States and STRE incurred
within the United States in conjunction with an approved activity where
the STRE has a programmatic purpose and are authorized with prior
written approval from the CCC. RAPP Participants are required to use
the appropriate American Embassy representational funding guidelines
for breakfasts, lunches, dinners and receptions incurred outside of the
United States as the basis for their calculating eligible expenses.
RAPP Participants may exceed Embassy guidelines by up to 25 percent
without prior approval. RAPP Participants may only exceed 125
[[Page 80102]]
percent of Embassy guidelines when they have received written
authorization from the FAS Agricultural Counselor at the Embassy. The
amount of unauthorized STRE expenses that exceed 125 percent of the
guidelines will not be reimbursed. RAPP Participants must pay the
difference between the total cost of STRE events and the appropriate
amount as determined by the guidelines and this part. For STRE incurred
in the United States, the RAPP Participant should provide, in its
request for approval, the basis for determining its proposed expenses.
(10) U.S. office(s) administrative support expenses, incurred
specifically to administer the RAPP, for the National Association of
State Departments of Agriculture, the SRTGs, and the Intertribal
Agriculture Council. The level of such funding will be established in
the approval letter.
(11) U.S. office(s) administrative support expenses, incurred
specifically to administer the RAPP, for any RAPP Participants not
identified in paragraph (c)(10) of this section, will be considered,
except for agricultural cooperatives. Reimbursement for such expenses
shall not exceed eight percent of the RAPP Participant's total RAPP
budget. The level of such funding will be established by CCC in the
approval letter.
(12) Non-travel expenditures associated with conducting
international staff conferences held either in or outside the United
States.
(13) Subject to paragraph (b)(18) of this section, domestic travel
expenditures, as allowed under the U.S. Federal Travel Regulations (41
CFR parts 301 through 304) and 2 CFR part 200, for international
retail, trade, and consumer exhibits and shows conducted in the United
States upon prior written approval by CCC. Domestic travel expenses to
such a show or exhibit are covered only if the exhibit or show is: a
food or agricultural show with no less than 30 percent of exhibitors
selling food or agricultural products; and an international show that
targets buyers, distributors and the like from more than one foreign
country and no less than 15 percent of its visitors are from countries
other than the host country. CCC will compile a list of approved
retail, trade, and consumer exhibits and shows held inside the United
States for which RAPP reimbursement is available and such list will be
announced to RAPP Participants via a RAPP notice issued on FAS'
website.
(14) Domestic travel expenditures, as allowed under the U.S.
Federal Travel Regulations (41 CFR parts 301 through 304) and 2 CFR
part 200, for seminars and educational training conducted in the United
States.
(15) Domestic travel expenditures, as allowed under the U.S.
Federal Travel Regulations (41 CFR parts 301 through 304) and 2 CFR
part 200, for up to two individuals, whether home office RAPP
Participant employees, RAPP Participant board members, or State
department of agriculture employees paid by the RAPP Participant, or a
combination thereof, when such individuals accompany foreign trade
missions or technical teams while traveling in the United States where
the following conditions are met:
(i) Such trade missions or technical team visits are identified in
the RAPP Participant's UES;
(ii) Such trade missions or technical team visits have been
approved by CCC; and
(iii) The RAPP-sponsored travelers submit a follow-up trip report
to CCC that includes the following:
(A) Purpose for the individuals' participation;
(B) Any pre-arranged business meetings;
(C) Itinerary and/or agenda for the trip; and
(D) Feedback from sponsors and trade mission/technical team members
on the success of the trip.
(16) Approved demonstration projects.
(17) Expenditures related to copyright, trademark, or patent
registration, including attorney fees.
(18) Rental or lease expenditures for storage space for program-
related materials.
(19) Business cards that target a foreign audience.
(20)(i) Expenditures associated with developing, updating, and
servicing websites on the internet that:
(A) Contain a message related to exporting or international trade;
(B) Include a discernible ``link'' to the FAS website or an FAS
overseas office website; and
(C) Have been specifically approved by the appropriate FAS
division. Expenditures related to websites or portions of websites that
are accessible only to an organization's members are not reimbursable.
(ii) Reimbursement claims for websites that include ``members
only'' sections must be prorated to exclude the costs associated with
those areas subject to restricted access.
(21) Expenditures not otherwise prohibited from reimbursement that
are associated with activities held in the United States or abroad
designed to improve market access by specifically addressing temporary,
permanent, or impending non-tariff barriers to trade that prohibit or
threaten U.S. exports of agricultural commodities. Examples of such
expenditures include, but are not limited to: initial pre-clearance
programs, educational training, policy advocacy, public relations
efforts, foreign country audits of U.S. facilities, export protocol and
work plan support, seminars and workshops, study tours, field surveys,
development of pest lists, pest and disease research, database
development, and reasonable logistical and administrative support.
(22) Organization costs for overseas offices approved in
agreements. Such costs include incorporation fees, brokers' fees, and
fees to attorneys, accountants, or investment counselors, whether or
not employees of the organization, incurred in connection with the
establishment or reorganization of the overseas office, and rent,
utilities, communications originating overseas, office supplies,
accident liability insurance premiums (provided the types and extent
and cost of coverage are in accordance with the RAPP Participant's
policy and sound business practice), and routine accounting and legal
services required to maintain the overseas office.
(23) With prior CCC approval, the purchase, lease, or repair of, or
insurance premiums for, capital goods that have an expected useful life
of at least one year, such as equipment, machinery, removable fixtures,
computer hardware and software, and portable electronic communications
devices (including mobile phones and wireless devices).
(24) Compensation and allowances for housing and cost of living
adjustments paid to a U.S. citizen employee or a U.S. citizen
contractor stationed overseas, provided such benefits are granted under
established written policies, except CCC will not reimburse that
portion of:
(i) The total of compensation and allowances that exceed 125
percent of the level of a GS-15 Step 10 salary for U.S. Government
employees; or
(ii) Allowances that exceed the rate authorized for U.S. Embassy
personnel.
(25) Compensation of non-U.S. citizen staff employees or non-U.S.
contractors stationed overseas, subject to the following limitations:
(i) Where there is a local U.S. Embassy Foreign Service National
(FSN) salary plan, CCC will not reimburse any portion of such
compensation that exceeds the compensation prescribed for the most
comparable position in the FSN salary plan; or
[[Page 80103]]
(ii) Where an FSN salary plan does not exist, CCC will not
reimburse any portion of such compensation that exceeds locally
prevailing levels, which the RAPP Participant shall document by a
salary survey or other means.
(26) A retroactive salary adjustment for non-U.S. citizen staff
employees or non-U.S. contractors stationed overseas that conforms to a
change in FSN salary plans, effective as of the date of such change.
(27) Accrued annual leave as of the time employment is terminated
or as of such time as required by local law.
(28) Overtime paid to clerical staff of approved RAPP-funded
overseas offices.
(29) Such premiums for health or accident insurance and other
benefits for foreign national employees that the employer is required
by law to pay, provided that such benefits are granted under
established written policies.
(30) Legal fees to obtain advice on the host country's labor laws.
(31) Employment agency fees.
(32) Evacuation payments (safe haven) and shipment and storage of
household goods and motor vehicles for relocations lasting at least 12
months.
(33) Travel costs for dependents, as allowed in 2 CFR part 200
(e.g., for travel of duration of six months or more with prior approval
of CCC).
(34) That portion of the cost of wireless phone plans that is
devoted to program activities and monthly service fees prorated at the
proportion of program-related usage to total usage.
(d) CCC will not reimburse any cost of:
(1) Forward year financial obligations, such as severance pay,
attributable to employment of foreign nationals;
(2) Expenses, fines, settlements, or judgments relating to legal
suits, challenges or disputes, except as otherwise allowed in 2 CFR
part 200 and this part;
(3) The design and production of packaging, labeling or origin
identification, except as specifically allowed in this part;
(4) Product development, product modification or product research,
except as specified in paragraph (c)(21) of this section;
(5) Product samples to be distributed to consumers;
(6) Slotting fees or similar sales expenditures;
(7) The purchase of, construction of, or lease of space for
permanent, non-mobile displays, i.e., displays that are constructed to
remain permanently in the same location beyond one budget period.
However, the CCC may, at its discretion, reimburse the construction or
purchase of permanent displays on a case-by-case basis, if the
Participant sought and received prior written approval from the CCC of
such construction or purchase;
(8) Rental, lease or purchase of warehouse space, except for
storage space for program-related material;
(9) Coupon redemption or price discounts of the RAPP promoted
commodity;
(10) Refundable deposits or advances;
(11) Giveaways, awards, prizes, gifts and other similar promotional
materials in excess of the limitation that the CCC will determine. Such
determination will be announced in writing via a RAPP notice issued on
FAS' website;
(12) Alcoholic beverages that are not a promoted commodity and part
of an approved promotional activity;
(13) The purchase, lease (except for use in authorized travel
status) or repair of motor vehicles;
(14) Travel of applicants for employment interviews;
(15) Unused non-refundable airline tickets or associated penalty
fees, except where travel was restricted by U.S. Government action or
advisory;
(16) Independent evaluations or audits, including evaluations or
audits of the activities of a subcontractor, if the CCC determines that
such a review is needed in order to confirm past or to ensure future
program agreement or regulatory compliance;
(17) Any arrangement that has the effect of reducing the selling
price of a U.S. agricultural commodity;
(18) Goods, services and salaries of personnel provided by U.S.
industry or foreign third party;
(19) Membership fees in clubs and social organizations;
(20) Indemnity and fidelity bonds, except as otherwise allowed in 2
CFR part 200;
(21) Fees for participating in U.S. Government-sponsored
activities, other than trade fairs and exhibits;
(22) Business cards that target a U.S. domestic audience;
(23) Seasonal greeting cards;
(24) Office parking fees;
(25) Subscriptions to publications that are not of a technical,
economic, or marketing nature or that are not relevant to the approved
activities of the RAPP Participant;
(26) U.S. office(s) administrative expenses, including
communication costs, except as noted in paragraphs (c)(10) and (11) of
this section, and except that usage costs for communications devices
incurred while on reimbursable international or domestic travel for
approved RAPP brand or generic promotion activities are reimbursable as
eligible travel expenditures as allowed under the U.S. Federal Travel
Regulations (41 CFR parts 301 through 304) and 2 CFR part 200;
(27) Any expenditure on an activity that includes any derogatory
reference or comparison to other U.S. agricultural commodities;
(28) Payment of U.S. and foreign employees' or contractors' share
of personal taxes, except where a foreign country's laws require the
RAPP Participant to pay such employees' or contractors' share;
(29) Any expenditure made for an activity prior to the CCC's
approval of that activity;
(30) Contributions to a contingency reserve or any similar
provision made for events the occurrence of which cannot be foretold
with certainty as to time, intensity, or with an assurance of their
happening;
(31) Expenditures associated with a RAPP Participant's creation or
review of their fraud prevention program, contracting procedures, or
brand program operational procedures;
(32) Entertainment (e.g., amusements, diversions, cover charges,
personal gifts, or tickets to theatrical or sporting events); and
(33) Refreshments, or related equipment, for office staff.
(e) For a brand promotion activity, the CCC will reimburse no more
than 50 percent of the total eligible expenditures made on that
activity by a brand participant.
(f) The CCC will reimburse for expenditures made after the
conclusion of a RAPP Participant's period of performance, provided:
(1) The activity was completed prior to the expiration date shown
in the RAPP Participant's program agreement; and
(2) All expenditures for the activity were made within 6 months
following the expiration date shown in the RAPP Participant's program
agreement.
(g) A RAPP Participant shall not use RAPP funds for any activity or
any expenses incurred by the RAPP Participant prior to the date of the
program agreement or after the date the program agreement is suspended
or terminated, except as otherwise permitted by the CCC.
(h) Except as otherwise provided in this part, RAPP-funded travel
shall conform to U.S. Federal Travel Regulations (41 CFR parts 301
through 304) and 2 CFR part 200, and RAPP-funded air travel shall
conform to the requirements of the Fly America Act (49 U.S.C. 40118).
For international travel, the RAPP Participant shall notify the
Attach[eacute]/Counselor in the destination
[[Page 80104]]
countries in writing in advance of any proposed travel.
(i) The CCC may determine, at the CCC's discretion, whether any
cost not expressly listed in this section will be reimbursed.
Sec. 1489.18 Reimbursement procedures.
(a) Participants are required to use the CCC's UES system to
request reimbursement for eligible expenditures under RAPP.
(b) All claims for reimbursement shall be submitted by the RAPP
Participant's U.S. office to the CCC through the UES system.
(c) [Reserved]
(d) The CCC will not reimburse claims submitted later than 6 months
after the expiration date shown in the RAPP Participant's program
agreement.
(e) If the CCC overpays a reimbursement claim, then the RAPP
Participant shall repay the CCC the amount of the overpayment either by
submitting a check payable to the CCC or by offsetting its next
reimbursement claim. The Participant shall make such payment within 30
calendar days of the date that they discover, or are made aware, of any
overpayment. The RAPP Participant shall make such payment in U.S.
dollars, unless otherwise approved in advance, in writing, by the CCC.
(f) If a RAPP Participant receives a reimbursement or offsets an
advanced payment that is later disallowed, the RAPP Participant shall
repay the CCC within 30 days of such disallowance the amount disallowed
either by submitting a check payable to the CCC or by offsetting its
next reimbursement claim. The RAPP Participant shall make such payment
in U.S. dollars, unless otherwise approved in advance, in writing, by
the CCC.
(g) RAPP funds may be expended by RAPP Participants only on
legitimate, approved activities as set forth in the program agreement
and approval letter. If a RAPP Participant discovers that RAPP funds
have not been properly spent, it shall notify the CCC and shall within
30 calendar days of its discovery repay the CCC the amount owed either
by submitting a check payable to the CCC or by offsetting its next
reimbursement claim. The RAPP Participant shall make such payment in
U.S. dollars.
(h) The RAPP Participant shall report any actions that may have a
bearing on the propriety of any claims for reimbursement in writing to
CCC.
Sec. 1489.19 Advances.
(a) Policy. In general, the CCC operates the RAPP on a reimbursable
basis.
(b) Exception. A RAPP Participant may request an advance of RAPP
funds from the CCC for generic promotion activities, provided the RAPP
Participant meets the criteria for advance payments in 2 CFR part 200.
The CCC will not approve any request for an advance submitted after the
expiration date shown in the RAPP Participant's program agreement. At
any given time, total payments advanced shall not exceed 40 percent of
a RAPP Participant's approved generic activity budget for the budget
period. The CCC will not advance funds to a RAPP Participant for brand
promotion activities. When approving a request for an advance, the CCC
may require the RAPP Participant to carry adequate fidelity bond
coverage when the absence of such coverage is considered by the CCC to
create an unacceptable risk to the interests of the RAPP. Whether an
``unacceptable risk'' exists in a particular situation will depend on a
number of factors, such as, for example, the Participant's history of
performance in RAPP; the Participant's perceived financial stability
and resources; and any other factors presented in the particular
situation that may reflect on the Participant's responsibility or the
riskiness of its activities.
(c) Interest. A RAPP Participant shall deposit and maintain in an
insured bank account in the United States all funds advanced by the
CCC. The account shall be interest-bearing unless the exceptions in 2
CFR part 200 apply. Interest earned by the RAPP Participant on funds
advanced by the CCC is not program income. The RAPP Participant shall
remit any interest earned on the advanced funds to the appropriate
entity as set forth in 2 CFR part 200.
(d) Refunds due the CCC. A RAPP Participant shall fully expend all
advances on approved generic promotion activities within 90 calendar
days after the date the advance was approved in the UES. By the end of
the 90 calendar days, the RAPP Participant must submit reimbursement
claims to offset the advance or submit a check made payable to CCC for
any unexpended balance. The RAPP Participant shall make such payment in
U.S. dollars, unless otherwise approved in advance, in writing, by the
CCC.
Sec. 1489.20 Financial management.
(a) A RAPP Participant shall implement and maintain a financial
management system that conforms to generally accepted accounting
principles. A RAPP Participant's financial management system shall
comply with the standards in 2 CFR part 200.
(b) A RAPP Participant shall institute internal controls and
provide written guidance to commercial entities participating in its
activities to ensure their compliance with this part.
(c) A RAPP Participant shall retain all records concerning a RAPP
program transaction for a period of three years after completion of the
program transaction and permit the CCC to have full and complete access
to such records during the transaction period and for such three-year
period after completion of the program transaction. These records shall
include all records pertaining to contractors.
(d) A RAPP Participant shall maintain its records of expenditures
and contributions in a manner that allows it to provide information by
activity plan, country, activity number, and cost category. Such
records shall include:
(1) Receipts for all STRE (actual vendor invoices or restaurant
checks, rather than credit card receipts);
(2) Original receipts for any other program-related expenditure in
excess of a set amount that CCC will determine and announce in writing
to all RAPP Participants via a RAPP notice issued on the FAS website.
The CCC may, from time to time, set a different minimum amount. In that
case, the CCC will announce the new amount in writing to all RAPP
Participants via a RAPP notice issued on the FAS website;
(3) The exchange rate used to calculate the dollar equivalent of
expenditures made in a foreign currency and the basis for such
calculation;
(4) Copies of reimbursement claims;
(5) An itemized list of claims charged to each of the RAPP
Participant's CCC resources accounts;
(6) Documentation with accompanying English translation supporting
each reimbursement claim, including original evidence to support the
financial transactions such as canceled checks, receipted paid bills,
contracts or purchase orders, per diem calculations, travel vouchers,
and credit memos; and
(7) Documentation supporting contributions. These must include the
dates, purpose, and location of the activity for which the cash or in-
kind items were claimed as a contribution; who conducted the activity;
the participating groups or individuals; and the method of computing
the claimed contributions. RAPP Participants must retain and make
available for compliance review documentation related to claimed
contributions.
(e) Upon request, a RAPP Participant shall provide to the CCC
originals of documents supporting reimbursement claims.
[[Page 80105]]
Sec. 1489.21 Reports.
(a) Contribution report. Not later than 6 months after the
expiration date shown in the RAPP Participant's program agreement, a
RAPP Participant shall submit a report that identifies, by cost
category and in U.S. dollar equivalent, contributions made by the
Participant, the applicable U.S. industry, and the States during the
Participant's RAPP period of performance. Foreign third-party
contributions are not to be included in the contribution report.
(b) Trip reports. Not later than 45 days after completion of travel
(other than local travel), a RAPP Participant shall electronically
submit a trip report. The report must include the name(s) of the
traveler(s), purpose of travel, itinerary, names and affiliations of
contacts, and a brief summary of findings, conclusions,
recommendations, and specific accomplishments.
(c) Research reports. Not later than 6 months after the expiration
date shown in the RAPP Participant's program agreement, a RAPP
Participant shall submit a report on any research conducted pursuant to
the approved RAPP program.
(d) Evaluation reports. Not later than 6 months after the
expiration date shown in the RAPP Participant's program agreement, a
RAPP Participant shall submit a report on any evaluations conducted in
accordance with the approved RAPP program, including the outcome of
action taken with RAPP funding and the increased market access or
exports that can be directly attributed to the RAPP program.
(e) Annual audits. Where the CCC is designated the cognizant agency
for audit, the CCC may require the RAPP Participant to submit to the
CCC an annual audit in accordance with 2 CFR part 200. If the CCC
requires an additional audit with respect to a particular agreement,
then the RAPP Participant shall arrange for such audit and shall submit
to the CCC, in the manner to be specified by the CCC, such audit of the
agreement.
(f) Additional reports. The CCC may require the submission of
additional reports.
(g) Approval letters. A RAPP Participant's program agreement and/or
approval letter shall specify to whom the Participant shall submit the
reports required in this section.
(h) Program reviews. FAS, through its authorized representatives,
may review project accomplishments, management control systems, and
administration of funding provided through the program to ensure
adherence to the requirements in this part. During such reviews, FAS
will review recipients' files related to the grant-funded program, and
technical assistance may be required.
Sec. 1489.22 Evaluation.
(a)(1) The Government Performance and Results Act (GPRA) of 1993 (5
U.S.C. 306; 31 U.S.C. 1105, 1115-1119, 3515, 9703-9704) requires
performance measurement of Federal programs, including the RAPP.
Evaluation of the RAPP's effectiveness will depend on a clear statement
by Participants of goals to be met within a specified time, schedule of
measurable milestones for gauging success, plan for achievement, and
assessment of results of activities at regular intervals. The overall
goal of the RAPP and of individual Participants' programming is to
increase sales that would not have occurred in the absence of RAPP
funding. A RAPP Participant that can demonstrate such sales, taking
into account extenuating factors beyond the Participant's control, will
have met the overall objective of the GPRA and the need for evaluation.
(2) Evaluation is an integral element of program planning and
implementation, providing the basis for the strategic plan. The
evaluation results guide the development and scope of a RAPP
Participant's program, contributing to program accountability and
providing evidence of program effectiveness that directly ties program
funds to increased sales.
(b) All RAPP Participants must report annual results against their
target market and/or regional constraint/opportunity performance
measures. These are outcome results usually based on multiple
activities and should demonstrate progress made in the market during
the latest budget period. This report shall be completed and submitted
to the CCC no later than 6 months following the end of each
Participant's budget period.
(c) When deemed appropriate or required by the CCC, a RAPP
Participant shall complete a program evaluation. A program evaluation
is a review of the RAPP Participant's entire program, or an appropriate
portion of the program as agreed to by the RAPP Participant and CCC, to
determine the effectiveness of the RAPP Participant's strategy in
meeting specified goals. Actual scope and timing of the program
evaluation shall be determined by the RAPP Participant and CCC and
specified in the approval letter. A RAPP Participant shall submit, via
a cover letter to CCC, an executive summary that assesses the program
evaluation's findings and recommendations, as well as any proposed
changes in program strategy or design as a result of the evaluation. A
program evaluation shall contain:
(1) The name of the party conducting the evaluation;
(2) The scope of the evaluation;
(3) A concise statement of the market constraint(s)/
opportunity(ies) and the goals specified in the approved strategic
plan;
(4) A description of the evaluation methodology;
(5) A description of export sales achieved;
(6) A summary of the findings, including an analysis of the
strengths and weaknesses of the program(s); and
(7) Recommendations for future programs.
(d) When deemed appropriate or required by the CCC, RAPP
Participants conducting a branded program must also complete a brand
promotion evaluation. A brand promotion evaluation is a review of the
U.S. and foreign commercial entities' export sales to determine whether
the activity achieved the goals specified in the approved RAPP program.
Actual scope and timing of the brand promotion evaluation shall be
determined by the RAPP Participant and CCC and specified in the
approval letter.
(e) On an annual basis, or more often when appropriate or required
by the CCC, a RAPP Participant shall complete and submit program
success stories. The CCC will announce to all RAPP Participants in
writing the detailed requirements for completing and submitting program
success stories.
Sec. 1489.23 Compliance reviews and notices.
(a) USDA staff may conduct compliance reviews of RAPP Participants'
activities under the RAPP program. RAPP Participants shall cooperate
fully with relevant USDA staff conducting compliance reviews and shall
comply with all requests from USDA staff to facilitate the conduct of
such reviews.
(b) Upon conclusion of the compliance review, USDA staff will
provide a written compliance report to the RAPP Participant. The
compliance report will specify whether USDA staff believe that CCC may
be entitled to recover funds from the Participant and/or it appears
that the Participant is not complying with any of the terms or
conditions of the program agreement, approval letter, or the applicable
laws and regulations. The compliance report will explain the basis for
any recovery of funds from the Participant. Within 60 calendar days of
the date the compliance report cover letter is signed, the RAPP
Participant shall repay the
[[Page 80106]]
CCC the amount owed either by submitting a check payable to the CCC or
by offsetting its next reimbursement claim. The RAPP Participant shall
make such payment in U.S. dollars, unless otherwise approved in
advance, in writing, by the CCC. If, however, a RAPP Participant
notifies the CCC within 60 calendar days of the date the compliance
report cover letter is signed that the Participant intends to file an
appeal pursuant to paragraph (e) of this section, then the amount owed
to the CCC by the RAPP Participant is not due until the appeal
procedures are concluded and the CCC has made a final written
determination as to the amount owed. If, as a result of a compliance
review, the CCC determines that further review is needed in order to
ensure compliance with the requirements of RAPP, then the CCC may
require the Participant to contract for an independent audit.
(c) In addition, the CCC may notify a RAPP Participant in writing
at any time if CCC determines that CCC may be entitled to recover funds
from the Participant. The CCC will explain the basis for any recovery
of funds from the Participant in the written notice. The RAPP
Participant shall, within 30 calendar days of the date of the notice,
repay the CCC the amount owed either by submitting a check payable to
the CCC or by offsetting its next reimbursement claim. The RAPP
Participant shall make such payment in U.S. dollars, unless otherwise
approved in advance, in writing, by the CCC. If, however, a RAPP
Participant notifies the CCC within 30 calendar days of the date of the
written notice that the Participant intends to file an appeal pursuant
to paragraph (e) of this section, then the amount owed to the CCC by
the RAPP Participant is not due until the appeal procedures are
concluded and the CCC has made a final determination as to the amount
owed.
(d) The fact that a compliance review has been conducted by USDA
staff does not signify that a RAPP Participant is in compliance with
its program agreement, approval letter, and/or applicable laws and
regulations.
(e) For appeals:
(1) A RAPP Participant may, within 60 calendar days of the date of
the compliance report or written notice from the CCC, submit a written
response to the CCC appealing the report or notice. CCC, at its
discretion, may extend the period for response.
(2) After review of the Participant's response, the CCC shall
determine whether the Participant owes any funds to the CCC and will
inform the Participant in writing of the basis for the determination.
The CCC will initiate action to collect such amount by providing the
Participant a written demand for payment of the debt pursuant to Debt
Settlement Policies and Procedures, 7 CFR part 3.
(3) Within 30 calendar days of the date of the determination, the
Participant may request in writing that the CCC reconsider the
determination and shall submit in writing the basis for such
reconsideration. The Participant may also request a hearing.
(4) If the Participant requests a hearing, the CCC will set a date
and time for the hearing. The hearing will be an informal proceeding. A
transcript will not ordinarily be prepared unless the Participant bears
the cost of a transcript; however, the CCC may in its discretion have a
transcript prepared at the CCC's expense.
(5) The CCC will base its final determination upon information
contained in the administrative record. The Participant must exhaust
all administrative remedies contained in this section before pursuing
judicial review of a determination by the CCC.
Sec. 1489.24 Failure to make required contribution.
A RAPP Participant's required contribution will be specified in the
approval letter. If the RAPP Participant's required contribution is
specified as a dollar amount and the RAPP Participant does not
contribute a total dollar amount sufficient to make the required
contribution, then the RAPP Participant shall pay to the CCC in dollars
the difference between the amount actually contributed and the amount
specified in the approval letter. If the RAPP Participant's required
contribution is specified as a percentage of the total amount
reimbursed by the CCC and the RAPP Participant does not provide a
dollar amount of contributions sufficient to achieve the specified
percentage, then the RAPP Participant may either return to the CCC the
amount of funds reimbursed by the CCC to increase its actual
contribution percentage to the required level or pay to the CCC in U.S.
dollars the difference between the amount actually contributed and the
amount of funds necessary to increase its actual contribution
percentage to the required level. A RAPP Participant shall remit such
payment within six months after the expiration date shown in the RAPP
Participant's program agreement. The RAPP Participant shall make such
payment in U.S. dollars, unless otherwise approved in advance, in
writing, by the CCC.
Sec. 1489.25 Submissions.
For all permissible methods of delivery, submissions required by
this part shall be deemed submitted as of the date received by the CCC.
Sec. 1489.26 Disclosure of program information.
(a) Documents submitted to CCC by RAPP Participants are subject to
the provisions of the Freedom of Information Act (FOIA), 5 U.S.C. 552,
and 7 CFR part 1, subpart A, specifically Sec. 1.12.
(b) Any research conducted by a RAPP Participant pursuant to a RAPP
program agreement and/or approval letter shall be subject to the
provisions relating to intangible property in 2 CFR part 200.
Sec. 1489.27 Ethical conduct.
(a) A RAPP Participant shall conduct its business in accordance
with the laws and regulations of the country in which an activity is
carried out and in accordance with applicable U.S. Federal, State, and
local laws and regulations. A RAPP Participant shall conduct its
business in the United States in accordance with applicable Federal,
State, and local laws and regulations. All RAPP Participants must
comply with the regulations in 2 CFR part 200 and this part.
(b) Except for a U.S. agricultural cooperative or a U.S. for-profit
entity, neither a RAPP Participant nor its affiliates shall make export
sales of eligible commodities covered under the terms of the applicable
RAPP agreement. Nor shall such entities charge a fee for facilitating
an export sale. A RAPP Participant may, however, collect check-off
funds and membership fees that are required for membership in the RAPP
Participant. For the purposes of this paragraph (b), affiliate means
any partnership, association, company, corporation, trust, or any other
such party in which the Participant has an investment other than in a
mutual fund.
(c) A RAPP Participant shall not limit participation in its RAPP
activities to members of its organization. Participants shall ensure
that their RAPP-funded programs and activities are open to all
otherwise qualified individuals and entities on an equal basis and
without regard to any non-merit factors. The RAPP Participant shall
publicize its program and make participation possible for commercial
entities throughout the relevant commodity sector or, in the case of
SRTGs, throughout the corresponding region. This includes providing to
such commercial entities, upon request, a copy of any document in its
possession
[[Page 80107]]
or control containing market information developed and produced under
the terms of its RAPP agreement. The Participant may charge a fee not
to exceed the costs for assembling, duplicating and distributing the
materials. This paragraph (c) does not apply to any U.S. agricultural
cooperative when implementing its own brand program.
(d) A RAPP Participant shall select U.S. agricultural industry
representatives to participate in generic RAPP activities such as trade
teams, sales teams, and trade fairs based on criteria that ensure
participation on an equitable basis by a broad cross section of the
U.S. industry. If requested by the CCC, a RAPP Participant shall submit
such selection criteria to the CCC for approval.
(e) All RAPP Participants should endeavor to ensure fair and
accurate fact-based advertising. Deceptive or misleading promotions may
result in cancellation or termination of a Participant's RAPP agreement
and the recovery of CCC funds related to such promotions from the
Participant.
(f) The RAPP Participant must report any actions or circumstances
that may have a bearing on the propriety of its RAPP program to the
appropriate Attach[eacute]/Counselor, and its U.S. office shall report
such actions or circumstances in writing to the CCC.
Sec. 1489.28 Contracting procedures.
(a) Neither the CCC nor any other agency of the U.S. Government nor
any official or employee of the CCC, FAS, USDA, or the U.S. Government
has any obligation or responsibility with respect to RAPP Participant
contracts with third parties.
(b) A RAPP Participant shall comply with the procurement standards
set forth in paragraphs (c) through (e) of this section when procuring
goods and services and when engaging in construction to implement
program agreements.
(c) Each RAPP Participant shall establish contracting procedures,
for contracts that are funded, in whole or in part, with RAPP funds,
that are open, fair, and competitive.
(d) Each RAPP Participant shall submit to the CCC, for CCC
approval, written contracting guidelines for contracts that are funded,
in whole or in part, with RAPP funds. The CCC will notify all new and
existing RAPP Participants in writing in each Participant's approval
letter and through the FAS website as to applicable submission dates
for and dates for approvals of contracting guidelines. The CCC's
approval of such contracting guidelines will remain in place until the
CCC retracts its approval in writing, or until new guidelines are
approved that supersede them. Once approved by the CCC, these
contracting guidelines shall govern all of a Participant's RAPP-funded
contracting involving contracts with a minimum annual value that CCC
will determine and announce in writing to all RAPP Participants via a
RAPP notice issued on the FAS website. The CCC may, from time to time,
set a different minimum value. In that case, the CCC will announce the
new amount in writing to all RAPP Participants via a RAPP notice issued
on the FAS website. The guidelines shall indicate the method for
evaluating proposals received for all contract competitions, the method
for monitoring and evaluating performance under contracts, and the
method for initiating corrective action for unsatisfactory performance
under contracts. The RAPP Participant may modify and resubmit these
guidelines for re-approval at any time. In addition to the requirements
in 2 CFR part 200, these guidelines shall include, at a minimum, the
following:
(1) Procedures for developing and publicizing requests for
proposals, invitations for bids, and similar documents that solicit
third party offers to provide goods or services. Solicitations for
professional and technical services shall be based on clear and
accurate descriptions of and requirements related to the services to be
procured. Such procedures must include a conflict-of-interest provision
that states that no employee, officer, board member, or agent thereof
of the RAPP Participant will participate in the review, selection,
award or administration of a contract if a real or apparent conflict of
interest would arise. Such a conflict would arise when an employee,
official, board member, agent, or the employee's, officer's, board
member's, agent's family, partners, or an organization that employs or
is about to employ any of the parties indicated in this paragraph
(d)(1), has a financial or other interest in the firm selected for an
award. Procedures shall provide that officers, employees, board
members, and agents thereof shall neither solicit nor accept
gratuities, favors, or anything of monetary value from contractors or
subcontractors. Procedures shall also provide for disciplinary actions
to be applied for violations of such standards by officers, employees,
board members or agents thereof;
(2) Procedures for reviewing proposals, bids, or other offers to
provide goods and services. Separate procedures shall be developed for
various situations, including, but not limited to: solicitations for
highly technical services; solicitations for services that are not
common in a specific market; solicitations that yield receipt of three
or more bids; solicitations that yield receipt of fewer than three
bids;
(3) Requirements to conduct all contracting in an openly
competitive manner. Individuals who develop or draft specifications,
requirements, statements of work, invitations for bids, and/or requests
for proposals for procurement of any goods or services, and such
individuals' families or partners, or an organization that employs or
is about to employ any of the aforementioned, shall be excluded from
competition for such procurement. RAPP Participants' written
contracting guidelines may detail special situations where the
prohibitions in this subparagraph do not apply, such as in situations
involving highly specialized technical services or situations where the
services are not commonly offered in a specific market;
(4) Requirements to perform and document in the procurement files
some form of price or cost analysis, such as a comparison of price
quotations to market prices or other price indicia, to determine the
reasonableness of the offered prices in connection with every
procurement action that is governed by the contracting guidelines;
(5) Requirements to conduct an appropriate form of competition
every three years on all multi-year contracts that are governed by the
contracting guidelines. However, contracts for in-country
representation are not required to be re-competed after the initial
award. Instead, the performance of in-country representation must be
evaluated and documented by the RAPP Participant annually to ensure
that the terms of the contract are being met in a satisfactory manner;
and
(6) Requirements for written contracts with each provider of goods,
services, or construction work. Such contracts shall require such
providers to maintain adequate records to account for funds provided to
them by the RAPP Participant.
(e) A RAPP Participant may undertake RAPP promotional activities
directly or through a domestic or foreign third party. However, the
RAPP Participant shall remain responsible and accountable to the CCC
for all RAPP promotional activities and related expenditures undertaken
by such third party and shall be responsible for reimbursing CCC for
any funds that CCC determines should be refunded to the CCC in relation
to such third party's promotional activities and expenditures.
[[Page 80108]]
Sec. 1489.29 Property standards.
The RAPP Participant shall insure all RAPP-funded property and
equipment acquired in furtherance of program activities and safeguard
such against theft, damage and unauthorized use. The Participant shall
promptly report any loss, theft, or damage of property to the insurance
company.
Sec. 1489.30 Anti-fraud requirements.
(a) All RAPP Participants. (1) All RAPP Participants shall submit
to the CCC for approval a detailed fraud prevention program. The CCC
will notify all new and existing RAPP Participants in writing in each
Participant's approval letter and through the FAS website as to
applicable submission dates for and dates for approvals of fraud
prevention programs. RAPP Participants should review their fraud
prevention programs annually. The fraud prevention program shall, at a
minimum, include an annual review of physical controls and weaknesses,
a standard process for investigating and remediation of suspected fraud
cases, and training in risk management and fraud detection for all
current and future employees. The RAPP Participant shall not conduct or
permit any RAPP promotion activities to occur unless and until the CCC
has communicated in writing approval of the RAPP Participant's fraud
prevention program.
(2) The RAPP Participant, within five business days of receiving an
allegation or information giving rise to a reasonable suspicion of
misrepresentation or fraud that could give rise to a claim by CCC,
shall report such allegation or information in writing to such USDA
personnel as specified in the Participant's RAPP program agreement and/
or approval letter. The RAPP Participant shall cooperate fully in any
USDA investigation of such allegation or occurrence of
misrepresentation or fraud and shall comply with any directives given
by the CCC or USDA to the RAPP Participant for the prompt investigation
of such allegation or occurrence.
(b) RAPP Participants with brand programs. (1) The RAPP Participant
may charge a fee to brand participants to cover the cost of the fraud
prevention program.
(2) The RAPP Participant shall repay to the CCC funds paid to a
brand participant through the RAPP Participant on claims that the RAPP
Participant or the CCC subsequently determines are unauthorized or
otherwise non-reimbursable expenses within 30 days of the RAPP
Participant's determination or CCC's disallowance. The RAPP Participant
shall repay CCC by submitting a check to CCC or by offsetting the RAPP
Participant's next reimbursement claim. The RAPP Participant shall make
such payment in U.S. dollars, unless otherwise approved in advance by
CCC. A RAPP Participant operating a brand program in strict accordance
with an approved fraud prevention program, however, will not be liable
to reimburse CCC for RAPP funds paid on such claims if the claims were
based on misrepresentations or fraud of the brand participant, its
employees or agents, unless the CCC determines that the RAPP
Participant was grossly negligent in the operation of the brand program
regarding such claims. The CCC shall communicate any such determination
to the RAPP Participant in writing.
Sec. 1489.31 Program income.
Any revenue or refunds generated from an activity, e.g.,
participation fees, proceeds of sales, refunds of value added taxes
(VAT), the expenditures for which have been wholly or partially
reimbursed with RAPP funds, shall be used by the RAPP Participant in
furtherance of its approved RAPP activities in the budget period during
which the RAPP funds are available for obligation by the RAPP
Participant. The use of such revenue or refunds shall be governed by
this part. Interest earned on funds advanced by the CCC is not program
income.
Sec. 1489.32 Amendment.
A program agreement may be amended in writing with the written
consent of the CCC and the RAPP Participant.
Sec. 1489.33 Noncompliance with an agreement or this part.
If a RAPP Participant fails to comply with any term in its program
agreement or approval letter, or this part, the CCC may take one or
more of the enforcement actions in 2 CFR part 200 and, if appropriate,
initiate a claim against the RAPP Participant, following the procedures
set forth in this part. The CCC may also initiate a claim against a
RAPP Participant if program income or CCC-provided funds are lost due
to an action or omission of the RAPP Participant.
Sec. 1489.34 Suspension, termination, and closeout of agreements.
A program agreement may be suspended or terminated in accordance
with the suspension and termination procedures in 2 CFR part 200. If an
agreement is terminated, the applicable regulations in 2 CFR part 200
will apply to the closeout of the agreement.
Sec. 1489.35 Paperwork reduction requirements.
The paperwork and record keeping requirements imposed by this part
have been approved by the Office of Management and Budget (OMB) under
the Paperwork Reduction Act of 1995. The control number for this
information collection is 0551-0049.
Marcus Graham,
Acting Executive Vice President, Commodity Credit Corporation.
[FR Doc. 2023-25015 Filed 11-16-23; 8:45 am]
BILLING CODE 3410-10-P