7 CFR Part 1493 — CCC Export Credit Guarantee Programs

PART 1493—CCC EXPORT CREDIT GUARANTEE PROGRAMS Authority: 7 U.S.C. 5602, 5622, 5661, 5662, 5663, 5664, 5676; 15 U.S.C. 714b(d), 714c(f). Source: 59 FR 52876, Oct. 19, 1994, unless otherwise noted. Subpart A—Restrictions and Criteria for Export Credit Guarantee Programs Source: 79 FR 68595, Nov. 18, 2014, unless otherwise noted. § 1493.1 General statement. This subpart sets forth the restrictions that apply to the issuance and use of Payment Guarantees under the Commodity Credit Corporation (CCC) Export Credit Guarantee (GSM-102) Program and Facility Guarantee Program (FGP), the criteria considered by CCC in determining the annual allocations of Payment Guarantees to be made available with respect to each participating country and region, and the criteria considered by CCC in the review and approval of proposed allocation levels for specific U.S. Agricultural Commodities to these countries and regions. § 1493.2 Purposes of programs. CCC is authorized to issue Payment Guarantees: (a) To increase exports of U.S. Agricultural Commodities and expand access to trade finance; (b) To assist countries, particularly developing countries and emerging markets, in meeting their food and fiber needs; (c) To establish or improve facilities and infrastructure in emerging markets to expand exports of U.S. Agricultural Commodities; or (d) For such other purposes as the Secretary of Agriculture determines appropriate. § 1493.3 Restrictions on programs and cargo preference statement. (a) Restrictions on use of Payment Guarantees. (2) CCC shall not make Payment Guarantees available in connection with sales of U.S. Agricultural Commodities to any country that the Secretary determines cannot adequately service the debt associated with such sale. (3) CCC shall not make Payment Guarantees available in connection with sales of U.S. Agricultural Commodities financed by any Foreign Financial Institution that CCC determines cannot adequately service the debt associated with such sale. (b) Cargo preference laws. § 1493.4 Criteria for country and regional allocations. The criteria considered by CCC in reviewing proposals for country and regional allocations will include, but not be limited to, the following: (a) Potential benefits that the extension of Payment Guarantees would provide for the development, expansion, or maintenance of the market for particular U.S. Agricultural Commodities in the importing country; (b) Financial and economic ability and/or willingness of the country of obligation to adequately service CCC guaranteed debt (“country of obligation” is the country whose Foreign Financial Institution obligation is guaranteed by CCC); (c) Financial status of participating Foreign Financial Institutions in the country of obligation as it would affect their ability to adequately service CCC guaranteed debt; (d) Political stability of the country of obligation as it would affect its ability and/or willingness to adequately service CCC guaranteed debt; and (e) Current status of debt either owed by the country of obligation or by the participating Foreign Financial Institutions to CCC or to lenders protected by CCC's Payment Guarantees. § 1493.5 Criteria for agricultural commodity allocations. The criteria considered by CCC in determining U.S. Agricultural Commodity allocations within a specific country or regional allocation will include, but not be limited to, the following: (a) Potential benefits that the extension of Payment Guarantees would provide for the development, expansion or maintenance of the market in the importing country for the particular U.S. Agricultural Commodity under consideration; (b) The best use to be made of the Payment Guarantees in assisting the importing country in meeting its particular needs for food and fiber, as may be determined through consultations with private buyers and/or representatives of the government of the importing country; and (c) Evaluation, in terms of program purposes, of the relative benefits of providing Payment Guarantee coverage for sales of the U.S. Agricultural Commodity under consideration compared to providing coverage for sales of other U.S. Agricultural Commodities. Subpart B—CCC Export Credit Guarantee Program (GSM-102) Operations Source: 79 FR 68596, Nov. 18, 2014, unless otherwise noted. § 1493.10 General statement. (a) Overview. (b) Program administration. (c) Country and regional program announcements. § 1493.20 Definition of terms. Terms set forth in this subpart, on the USDA Web site (including in Program Announcements and notices to participants), and in any CCC-originated documents pertaining to the GSM-102 Program will have the following meanings: Affiliate. Assignee. Business Day. CCC. CCC Late Interest. Cost and Freight (CFR). Cost Insurance and Freight (CIF). Date of Export. Date of Sale. Director. Discounts and Allowances. Eligible Export Sale. Eligible Interest. (1) The amount calculated using the interest rate specified between the Holder of the Payment Guarantee and the Foreign Financial Institution; or (2) The amount calculated using the specified percentage of the Treasury bill investment rate set forth on the face of the Payment Guarantee. Exported Value. (i) Where the U.S. Agricultural Commodity is sold on a FAS, FCA, or FOB basis, the value, FAS, FCA, or FOB basis, port of shipment, of the export sale, reduced by the value of any Discounts and Allowances granted to the Importer in connection with such sale; or (ii) Where the U.S. Agricultural Commodity was sold on a CFR or CIF basis, point of entry, the value of the export sale, FAS, FCA or FOB, port of shipment, is measured by the CFR or CIF value of the U.S. Agricultural Commodity less the cost of ocean freight, as determined at the time of application and, in the case of CIF sales, less the cost of marine and war risk insurance, as determined at the time of application, reduced by the value of any Discounts and Allowances granted to the Importer in connection with the sale of the commodity; or (2) Where CCC announces coverage on a CFR or CIF basis, and where the U.S. Agricultural Commodity is sold on a CFR or CIF basis, port of destination, the total value of the export sale, CFR or CIF basis, port of destination, reduced by the value of any Discounts and Allowances granted to the Importer in connection with the sale of the commodity; or (3) When a CFR or CIF U.S. Agricultural Commodity export sale involves the performance of non-freight services to be performed outside the United States (e.g., services such as bagging bulk cargo) which are not normally included in ocean freight contracts, the value of such services and any related materials not exported from the U.S. with the commodity must also be deducted from the CFR or CIF sales price in determining the Exported Value. Exporter. Firm Export Sales Contract. Foreign Financial Institution. (1) Organized and licensed under the laws of a jurisdiction outside the United States; (2) Not domiciled in the United States; and (3) Subject to the banking or other financial regulatory authority of a foreign jurisdiction (except for multilateral and sovereign institutions). Foreign Financial Institution Letter of Credit or Letter of Credit. Free Alongside Ship (FAS). Free Carrier (FCA). Free on Board (FOB). GSM. Guaranteed Value. Holder of the Payment Guarantee. Importer. Importer's Representative. Incoterms. Intervening Purchaser. Ordinary Interest. Payment Guarantee. Port Value. (i) Where the U.S. Agricultural Commodity is sold on a FAS, FCA, or FOB basis, port of shipment, the value, FAS, FCA, or FOB basis, port of shipment, of the export sale, including the upward loading tolerance, if any, as provided by the Firm Export Sales Contract, reduced by the value of any Discounts and Allowances granted to the Importer in connection with such sale; or (ii) Where the U.S. Agricultural Commodity was sold on a CFR or CIF basis, port of destination, the value of the export sale, FAS, FCA, or FOB, port of shipment, including the upward loading tolerance, if any, as provided by the Firm Export Sales Contract, is measured by the CFR or CIF value of the U.S. Agricultural Commodity less the value of ocean freight and, in the case of CIF sales, less the value of marine and war risk insurance, reduced by the value of any Discounts and Allowances granted to the Importer in connection with the sale of the commodity. (2) Where CCC announces coverage on a CFR or CIF basis and where the U.S. Agricultural Commodity was sold on CFR or CIF basis, port of destination, the total value of the export sale, CFR or CIF basis, port of destination, including the upward loading tolerance, if any, as provided by the Firm Export Sales Contract, reduced by the value of any Discounts and Allowances granted to the Importer in connection with the sale of the commodity. (3) When a CFR or CIF U.S. Agricultural Commodity export sale involves the performance of non-freight services to be performed outside the United States (e.g., services such as bagging bulk cargo), which are not normally included in ocean freight contracts, the value of such services and any related materials not exported from the U.S. with the commodity must also be deducted from the CFR or CIF sales price in determining the Port Value. Post Default Interest. Principal. Program Announcement. Repayment Obligation. Repurchase Agreement. SAM (System for Award Management). Terms and Conditions Document. United States or U.S. U.S. Agricultural Commodity or U.S. Agricultural Commodities. (ii) A product of an agricultural commodity— (A) 90 percent or more of the agricultural components of which by weight, excluding packaging and added water, is entirely produced in the United States; and (B) That the Secretary determines to be a high value agricultural product. (2) For purposes of this definition, fish entirely produced in the United States include fish harvested by a documented fishing vessel as defined in title 46, United States Code, in waters that are not waters (including the territorial sea) of a foreign country. USDA. U.S. Financial Institution. (1) Organized and licensed under the laws of a jurisdiction within the United States; (2) Domiciled in the United States; and (3) Subject to the banking or other financial regulatory authority jurisdiction within the United States. Weighted Average Export Date. § 1493.30 Information required for Exporter participation. Exporters must apply and be approved by CCC to be eligible to participate in the GSM-102 Program. (a) Qualification requirements. (1) For the applicant: (i) The name and full U.S. address (including the full 9-digit zip code) of the applicant's office, along with an indication of whether the address is a business or private residence. A post office box is not an acceptable address. If the applicant has multiple offices, the address included in the information should be that which is pertinent to the GSM-102 export sales contemplated by the applicant; (ii) Dun and Bradstreet (DUNS) number; (iii) Employer Identification Number (EIN—also known as a Federal Tax Identification Number); (iv) Telephone and fax numbers; (v) Email address (if applicable); (vi) Business Web site (if applicable); (vii) Contact name; (viii) Statement indicating whether the applicant is a U.S. domestic entity or a foreign entity domiciled in the United States; and (ix) The form of business entity of the applicant (e.g., sole proprietorship, partnership, corporation, etc.) and the U.S. jurisdiction under which such entity is organized and authorized to conduct business. Such jurisdictions are a U.S. State, the District of Columbia, Puerto Rico, and the territories and possessions of the United States. Upon request by CCC, the applicant must provide written evidence that such entity has been organized in a U.S. State, the District of Columbia, Puerto Rico, or a territory or possession of the United States. (2) For the applicant's headquarters office: (i) The name and full address of the applicant's headquarters office. A post office box is not an acceptable address; and (ii) Telephone and fax numbers. (3) For the applicant's agent for the service of process: (i) The name and full U.S. address of the applicant's agent's office, along with an indication of whether the address is a business or private residence; (ii) Telephone and fax numbers; (iii) Email address (if applicable); and (iv) Contact name. (4) A description of the applicant's business. Applicants must provide the following information: (i) Nature of the applicant's business (e.g., agricultural producer, commodity trader, consulting firm, etc.); (ii) Explanation of the applicant's experience/history with U.S. Agricultural Commodities for the preceding three years, including a description of such commodities; (iii) Explanation of the applicant's experience/history exporting U.S. Agricultural Commodities, including number of years involved in exporting, types of products exported, and destination of exports for the preceding three years; and (iv) Whether or not the applicant is a “small or medium enterprise” (SME) as defined on the USDA Web site; (5) A listing of any related companies (e.g., Affiliates, subsidiaries, or companies otherwise related through common ownership) currently qualified to participate in CCC export programs; (6) A statement describing the applicant's participation, if any, during the past three years in U.S. Government programs, contracts or agreements; and (7) A statement that: “All certifications set forth in 7 CFR 1493.60(a) are hereby made in this application” which, when included in the application, will constitute a certification that the applicant is in compliance with all of the requirements set forth in § 1493.60(a). The applicant will be required to provide further explanation or documentation if not in compliance with these requirements or if the application does not include this statement. (b) Qualification notification. (c) Previous qualification. (d) Ineligibility for program participation. § 1493.40 Information required for U.S. Financial Institution participation. U.S. Financial Institutions must apply and be approved by CCC to be eligible to participate in the GSM-102 Program. (a) Qualification requirements. (1) Legal name and address of the applicant; (2) Dun and Bradstreet (DUNS) number; (3) Employer Identification Number (EIN—also known as a Federal Tax Identification Number); (4) Year-end audited financial statements for the applicant's most recent fiscal year; (5) Breakdown of the applicant's ownership as follows: (i) Ten largest individual shareholders and ownership percentages; (ii) Percentage of government ownership, if any; and (iii) Identity of the legal entity or person with ultimate control or decision making authority, if other than the majority shareholder. (6) Organizational structure (independent, or a subsidiary, Affiliate, or branch of another financial institution); (7) Documentation from the applicable United States Federal or State agency demonstrating that the applicant is either licensed or chartered to do business in the United States; (8) Name of the agency that regulates the applicant and the name and telephone number of the primary contact for such regulator; and (9) A statement that: “All certifications set forth in 7 CFR 1493.60 are hereby made in this application” which, when included in the application, will constitute a certification that the applicant is in compliance with all of the requirements set forth in § 1493.60. The applicant will be required to provide further explanation or documentation if not in compliance with these requirements or if the application does not include this statement. (b) Qualification notification. (c) Previous qualification. (d) Ineligibility for program participation. § 1493.50 Information required for Foreign Financial Institution participation. Foreign Financial Institutions must apply and be approved by CCC to be eligible to participate in the GSM-102 Program. (a) Qualification requirements. (1) Legal name and address of the applicant; (2) Year end, audited financial statements in accordance with the accounting standards established by the applicant's regulators, in English, for the applicant's three most recent fiscal years. If the applicant is not subject to a banking or other financial regulatory authority, year-end, audited financial statements in accordance with prevailing accounting standards, in English, for the applicant's three most recent fiscal years; (3) Breakdown of applicant's ownership as follows: (i) Ten largest individual shareholders and ownership percentages; (ii) Percentage of government ownership, if any; and (iii) Identity of the legal entity or person with ultimate control or decision making authority, if other than the majority shareholder. (4) Organizational structure (independent, or a subsidiary, Affiliate, or branch of another legal entity); (5) Name of foreign government agency that regulates the applicant; and (6) A statement that: “All certifications set forth in 7 CFR 1493.60 are hereby made in this application” which, when included in the application, will constitute a certification that the applicant is in compliance with all of the requirements set forth in § 1493.60. The applicant will be required to provide further explanation or documentation if not in compliance with these requirements or if the application does not include this statement. (b) Qualification notification. (c) Participation limit. (d) Previous qualification and submission of annual financial statements. (e) Ineligibility for program participation. (1) Such applicant cannot provide all of the information and certifications required in paragraph (a) of this section; or (2) Based upon information submitted by the applicant or other publicly available sources, CCC determines that the applicant cannot adequately service the debt associated with the Payment Guarantees issued by CCC. § 1493.60 Certifications required for program participation. (a) When making the statement required by §§ 1493.30(a)(7), 1493.40(a)(9), or 1493.50(a)(6), each Exporter, U.S. Financial Institution and Foreign Financial Institution applicant for program participation is certifying that, to the best of its knowledge and belief: (1) The applicant and any of its principals (as defined in 2 CFR 180.995) are not presently debarred, suspended, proposed for debarment, declared ineligible, or excluded from covered transactions by any U.S. Federal department or agency; (2) The applicant and any of its principals (as defined in 2 CFR 180.995) have not within a three-year period preceding this application been convicted of or had a civil judgment rendered against them for commission of fraud or a criminal offense in connection with obtaining, attempting to obtain, or performing a public (Federal, State, or local) transaction or contract under a public transaction; violation of Federal or State antitrust statues or commission of embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements, or receiving stolen property; (3) The applicant and any of its principals (as defined in 2 CFR 180.995) are not presently indicted for or otherwise criminally or civilly charged by a governmental entity (Federal, State or local) with commission of any of the offenses enumerated in paragraph (a)(2) of this section; (4) The applicant and any of its principals (as defined in 2 CFR 180.995) have not within a three-year period preceding this application had one or more public transactions (Federal, State or local) terminated for cause or default; (5) The applicant does not have any outstanding nontax debt to the United States that is in delinquent status as provided in 31 CFR 285.13; (6) The applicant is not controlled by a person owing an outstanding nontax debt to the United States that is in delinquent status as provided in 31 CFR 285.13 (e.g., a corporation is not controlled by an officer, director, or shareholder who owes a debt); and (7) The applicant does not control a person owing an outstanding nontax debt to the United States that is in delinquent status as provided in 31 CFR 285.13 (e.g., a corporation does not control a wholly-owned or partially-owned subsidiary which owes a debt). (b) Additional certifications for U.S. and Foreign Financial Institution applicants. (1) The applicant and its Principals are in compliance with all requirements, restrictions and guidelines as established by the applicant's regulators; and (2) All U.S. operations of the applicant and its U.S. Principals are in compliance with U.S. anti-money laundering and terrorist financing statutes including, but not limited to, the USA Patriot Act of 2001, and the Foreign Corrupt Practices Act of 1977. [79 FR 68596, Nov. 18, 2014, as amended at 84 FR 28186, June 18, 2019] § 1493.70 Application for Payment Guarantee. (a) A Firm Export Sales Contract for an Eligible Export Sale must exist before an Exporter may submit an application for a Payment Guarantee. Upon request by CCC, the Exporter must provide evidence of a Firm Export Sales Contract. An application for a Payment Guarantee must be submitted in writing to CCC in the manner specified on the USDA Web site. An application must identify the name and address of the Exporter and include the following information: (1) Name of the destination country or region. If the destination is a region, indicate the country or countries within the region to which the U.S. Agricultural Commodity will be exported. (2) Name and address of the Importer. If the Importer is not physically located in the country or region of destination, it must have an Importer's Representative in the country or region of destination. If applicable, provide the name and address of the Importer's Representative. (3) A statement that the U.S. Agricultural Commodity will be shipped to the destination country or region. (4) Name and address of the party on whose request the Letter of Credit is issued, if other than the Importer. (5) Name and address of the Intervening Purchaser, if any. (6) Date of Sale. (7) Exporter's sale number. (8) Delivery period as agreed between the Exporter and the Importer. (9) A full description of the U.S. Agricultural Commodity (including packaging, if any). The description must include the applicable six-digit Harmonized System commodity classification code. The commodity grade and quality specified in the Exporter's application for the Payment Guarantee must correspond with the commodity grade and quality specified in the Firm Export Sales Contract and the Foreign Financial Institution Letter of Credit. (10) Mean quantity, contract loading tolerance and, if necessary, a request for CCC to reserve coverage up to the maximum quantity permitted. (11) Unit sales price of the U.S. Agricultural Commodity, or a mechanism to establish the price, as agreed between the Exporter and the Importer. If the commodity was sold on the basis of CFR or CIF, the actual (if known at the time of application) or estimated value of freight and, in the case of sales made on a CIF basis, the actual (if known at the time of application) or estimated value of marine and war risk insurance, must be specified. (12) Description and value of Discounts and Allowances, if any. (13) Port Value (includes upward loading tolerance, if any). (14) Guaranteed Value. (15) Guarantee fee, either as announced on the Web site per § 1493.110(a)(1), or the competitive fee bid per § 1493.110(a)(2), depending on the type of fee charged by CCC for the country or region. (16) Name and location of the Foreign Financial Institution issuing the Letter of Credit and, upon request by CCC, written evidence that the Foreign Financial Institution has agreed to issue the Letter of Credit. (17) The term length for the credit being extended and the intervals between principal payments for each shipment to be made under the export sale. (18) The Exporter's statement, “All certifications set forth in 7 CFR 1493.80 are hereby being made by the Exporter in this application.” which, when included in the application by the Exporter, will constitute a certification that it is in compliance with all the requirements set forth in § 1493.80. (b) An application for a Payment Guarantee may be approved as submitted, approved with modifications agreed to by the Exporter, or rejected by the Director. In the event that the application is approved, the Director will cause a Payment Guarantee to be issued in favor of the Exporter. Such Payment Guarantee will become effective at the time specified in § 1493.100(b). If, based upon a price review, the unit sales price of the commodity does not fall within the prevailing commercial market level ranges, as determined by CCC, the application will not be approved. § 1493.80 Certification requirements for obtaining Payment Guarantee. By providing the statement in § 1493.70(a)(18), the Exporter is certifying that the information provided in the application is true and correct and, further, that all requirements set forth in this section have been met. The Exporter will be required to provide further explanation or documentation with regard to applications that do not include this statement. If the Exporter makes false certifications with respect to a Payment Guarantee, CCC will have the right, in addition to any other rights provided under this subpart or otherwise as a matter of law, to revoke guarantee coverage for any commodities not yet exported and/or to commence legal action and/or administrative proceedings against the Exporter. The Exporter, in submitting an application for a Payment Guarantee and providing the statement set forth in § 1493.70(a)(18), certifies that: (a) The commodity or product covered by the Payment Guarantee is a U.S. Agricultural Commodity; (b) There have not been any corrupt payments or extra sales services or other items extraneous to the transaction provided, financed, or guaranteed in connection with the transaction, and the transaction complies with applicable United States law, including the Foreign Corrupt Practices Act of 1977 and other anti-bribery measures; (c) If the U.S. Agricultural Commodity is vegetable oil or a vegetable oil product, that none of the agricultural commodity or product has been or will be used as a basis for a claim of a refund, as drawback, pursuant to section 313 of the Tariff Act of 1930, 19 U.S.C. 1313, of any duty, tax or fee imposed under Federal law on an imported commodity or product; (d) At the time of submission of the application for Payment Guarantee, neither the Importer nor the Intervening Purchaser, if applicable, is present as an excluded party on the SAM list; (e) The Exporter is fully in compliance with the requirements of § 1493.130(b) for all existing Payment Guarantees issued to the Exporter or has requested and been granted an extension per § 1493.130(b)(3); and (f) The information provided pursuant to § 1493.30 has not changed and the Exporter still meets all of the qualification requirements of § 1493.30. § 1493.90 Special requirements of the Foreign Financial Institution Letter of Credit and the Terms and Conditions Document, if applicable. (a) Permitted mechanisms to document special requirements. (i) The Letter of Credit must stipulate presentation of at least one original clean on board bill of lading as a required document, unless: (A) The Exporter, or a related company previously reported to CCC by the Exporter pursuant to § 1493.30(a)(5), is named as the shipper on the clean on board bill of lading. If the Exporter or a related company is named the shipper on the bill of lading, the Letter of Credit may stipulate a copy or photocopy of an original clean on board bill of lading; or (B) The Letter of Credit stipulates presentation of electronic documents per paragraph (a)(1)(ii) of this section. (ii) If the Letter of Credit will allow for presentation of electronic documents, the Letter of Credit must so stipulate. (2) The use of a Terms and Conditions Document is optional. The Terms and Conditions Document, if any, must be specifically identified and referred to in the Foreign Financial Institution Letter of Credit. (3) The special requirements in paragraph (b) of this section must be documented in one of the two following ways: (i) The special requirements may be set forth in the Foreign Financial Institution Letter of Credit as a special instruction from the Foreign Financial Institution; or (ii) The special requirements may be set forth in a separate Terms and Conditions Document. (b) Special requirements. (1) The terms of the Repayment Obligation, including a specific promise by the Foreign Financial Institution issuing the Letter of Credit to pay the Repayment Obligation; (2) The following language: “In the event that the Commodity Credit Corporation (“CCC”) is subrogated to the position of the obligee hereunder, this instrument shall be governed by and construed in accordance with the laws of the State of New York, excluding its conflict of laws principles. In such case, any legal action or proceeding arising under this instrument will be brought exclusively in the U.S. District Court for the Southern District of New York or the U.S. District Court for the District of Columbia, as determined by CCC, and such parties hereby irrevocably consent to the personal jurisdiction and venue therein.”; (3) A provision permitting the Holder of the Payment Guarantee to declare all or any part of the Repayment Obligation, including accrued interest, immediately due and payable, in the event a payment default occurs under the Letter of Credit or, if applicable, the Terms and Conditions Document; and (4) Post Default Interest terms. § 1493.100 Terms and requirements of the Payment Guarantee. (a) CCC's obligation. (b) Period of guarantee coverage. (2)(i) The period of coverage under the Payment Guarantee begins on the earlier of the following dates and will continue during the credit term specified on the Payment Guarantee or any amendments thereto: (A) The Date(s) of Export or the Weighted Average Export Date(s), as selected by the Holder of the Payment Guarantee consistent with paragraph (b)(1) of this section; or (B) The date when Ordinary Interest begins to accrue, or the weighted average date when interest begins to accrue. (ii) However, the Payment Guarantee becomes effective on the Date(s) of Export of the U.S. Agricultural Commodities specified in the Exporter's application for the Payment Guarantee. (c) Terms of the CCC Payment Guarantee. (d) Final date to export. (e) Reserve coverage for loading tolerances. (f) Certain export sales are ineligible for GSM-102 Payment Guarantees. (1) The commodity is not a U.S. Agricultural Commodity; (2) The export sale includes corrupt payments or extra sales or services or other items extraneous to the transactions provided, financed, or guaranteed in connection with the export sale; (3) The export sale does not comply with applicable U.S. law, including the Foreign Corrupt Practices Act of 1977 and other anti-bribery measures; (4) If the U.S. Agricultural Commodity is vegetable oil or a vegetable oil product, any of the agricultural commodity or product has been or will be used as a basis for a claim of a refund, as drawback, pursuant to section 313 of the Tariff Act of 1930, 19 U.S.C. 1313, of any duty, tax or fee imposed under Federal law on an imported commodity or product; (5) Either the Importer or the Intervening Purchaser, if any, is excluded or disqualified from participation in U.S. government programs; or (6) The sale is not an Eligible Export Sale. (g) Certain exports of U.S. Agricultural Commodities are ineligible for Payment Guarantee coverage. (1) Exports of U.S. Agricultural Commodities with a Date of Export prior to the date of receipt by CCC of the Exporter's written application for a Payment Guarantee; (2) Exports of U.S. Agricultural Commodities with a Date of Export later than the final date to export shown on the Payment Guarantee or any amendments thereof; (3) Exports of U.S. Agricultural Commodities where the date of issuance of a Foreign Financial Institution Letter of Credit is later than 30 calendar days after: (i) The Date of Export, or (ii) The Weighted Average Export Date, if the Holder of the Payment Guarantee has elected to have the Payment Guarantee coverage begin on the Weighted Average Export Date; or (4) Exports of U.S. Agricultural Commodities that have been guaranteed by CCC under another Payment Guarantee. If CCC determines that an export of U.S. Agricultural Commodities has been guaranteed under multiple Payment Guarantees (or coverage has been requested under multiple Payment Guarantees), CCC will determine which Payment Guarantee (or application for Payment Guarantee), if any, corresponds to an Eligible Export Sale. (h) Additional requirements. (i) Amendments. § 1493.110 Guarantee fees. (a) Guarantee fee rates. (1) Those that are announced on the USDA Web site and are based upon the length of the payment terms provided for in the Firm Export Sales Contract, the degree of risk that CCC assumes, as determined by CCC, and any other factors which CCC determines appropriate for consideration. (2) Those where Exporters are invited to submit a competitive bid for coverage. If CCC determines to offer coverage on a competitive fee bid basis, instructions for bidding, and minimum fee rates, if applicable, will be made available on the USDA Web site. (b) Calculation of fee. (c) Payment of fee. (d) Refunds of fee. § 1493.120 Assignment of the Payment Guarantee. (a) Requirements for assignment. (1) Made to one party acting for two or more parties, or (2) Subject to further assignment. (b) CCC to receive notice of assignment of payment guarantee. (c) Required certifications. (i) [Name of Assignee] has verified that the Foreign Financial Institution, at the time of submission of the notice of assignment, is not present as an excluded party on the SAM list; and (ii) To the best of my knowledge and belief, the information provided pursuant to § 1493.40 has not changed and [name of Assignee] still meets all of the qualification requirements of § 1493.40.” (2) If the Assignee makes a false certification with respect to a Payment Guarantee, CCC may, in its sole discretion, in addition to any other action available as a matter of law, rescind and cancel the Payment Guarantee, reject the assignment of the Payment Guarantee, and/or commence legal action and/or administrative proceedings against the Assignee. (d) Notice of eligibility to receive assignment. (e) Ineligibility of U.S. Financial Institutions to receive an assignment and proceeds. (1) At the time of assignment of a Payment Guarantee, is not in compliance with all requirements of 1493.40(a); or (2) Is the branch, agency, or subsidiary of the Foreign Financial Institution issuing the Letter of Credit; or (3) Is owned or controlled by an entity that owns or controls the Foreign Financial Institution issuing the Letter of Credit; or (4) Is the U.S. parent of the Foreign Financial Institution issuing the Foreign Financial Institution Letter of Credit; or (5) Is owned or controlled by the government of a foreign country and the Payment Guarantee has been issued in connection with export sales of U.S. Agricultural Commodities to Importers located in such foreign country. (f) Repurchase agreements. (i) Any repurchase under a Repurchase Agreement by the Holder of the Payment Guarantee must be for the entirety of the outstanding balance under the associated Repayment Obligation; (ii) In the event of a default with respect to the Repayment Obligation subject to a Repurchase Agreement, the Holder of the Payment Guarantee must immediately effect such repurchase; and (iii) The Holder of the Payment Guarantee must file all documentation required by §§ 1493.160 and 1493.170 in case of a default by the Foreign Financial Institution under the Payment Guarantee. (2) The Holder of the Payment Guarantee shall, within five Business Days of execution of a transaction under the Repurchase Agreement, notify CCC of the transaction in writing in the manner specified on the USDA Web site. Such notification must include the following information: (i) Name and address of the other party to the Repurchase Agreement; (ii) A statement indicating whether the transaction executed under the Repurchase Agreement is for a fixed term or if it is terminable upon demand by either party. If fixed, provide the purchase date and the agreed upon date for repurchase. If terminable on demand, provide the purchase date only; and (iii) The following written certification: “[Name of Holder of the Payment Guarantee] has entered into a Repurchase Agreement that meets the provisions of 7 CFR 1493.120(f)(1) and, prior to entering into this agreement, verified that [name of other party to the Repurchase Agreement] is not present as an excluded party on the SAM list.” (3) Failure of the Holder of the Payment Guarantee to comply with any of the provisions of paragraph (f) of this section may result in CCC annulling coverage on the Foreign Financial Institution Letter of Credit and Terms and Conditions Document, if applicable, covered by the Payment Guarantee. § 1493.130 Evidence of export. (a) Report of export. (1) Payment Guarantee number; (2) Evidence of export report number (e.g., Report 1, Report 2) reflecting the report's chronological order of submission under the particular Payment Guarantee; (3) Date of Export; (4) Destination country or region. If the sale was registered under a regional program, the Exporter must indicate the specific country or countries within the region to which the goods were shipped; (5) Exporter's sale number; (6) Exported Value; (7) Quantity; (8) A full description of the commodity exported, including the applicable six-digit Harmonized System commodity classification code; (9) Unit sales price received for the commodity exported and the Incoterms 2010 basis (e.g., FOB, CFR, CIF). Where the unit sales price at export differs from the unit sales price indicated in the Exporter's application for a Payment Guarantee, the Exporter is also required to submit a statement explaining the reason for the difference; (10) Description and value of Discounts and Allowances, if any; (11) The Exporter's statement, “All certifications set forth in 7 CFR 1493.140 are hereby being made by the Exporter in this Evidence of Export.” which, when included in the evidence of export by the Exporter, will constitute a certification that it is in compliance with all the requirements set forth in § 1493.140; and (12) In addition to all of the above information, the final evidence of export report for the Payment Guarantee must include the following: (i) The statement “Exports under the Payment Guarantee have been completed.” (ii) A statement summarizing the total quantity and value of the commodity exported under the Payment Guarantee (i.e., the cumulative totals on all numbered evidence of export reports). (b) Time limit for submission of evidence of export. (2) If at any time the Exporter determines that no shipments are to be made under a Payment Guarantee, the Exporter is required to notify CCC in writing no later than the final date to export specified on the Payment Guarantee by furnishing the Payment Guarantee number and stating “no exports will be made under the Payment Guarantee.” (3) Requests for an extension of the time limit for submitting an evidence of export report must be submitted in writing by the Exporter to the Director and must include an explanation of why the extension is needed. An extension of the time limit may be granted if such extension is requested prior to the expiration of the time limit for filing and is determined by the Director to be in the best interests of CCC. (c) Failure to comply with time limits for submission. (d) Export sales reporting. § 1493.140 Certification requirements for the evidence of export. By providing the statement contained in § 1493.130(a)(11), the Exporter is certifying that the information provided in the evidence of export report is true and correct and, further, that all requirements set forth in this section have been met. The Exporter will be required to provide further explanation or documentation with regard to reports that do not include this statement. If the Exporter makes false certifications with respect to a Payment Guarantee, CCC will have the right, in addition to any other rights provided under this subpart or otherwise as a matter of law, to annul guarantee coverage for any commodities not yet exported and/or to commence legal action and/or administrative proceedings against the Exporter. The Exporter, in submitting the evidence of export and providing the statement set forth in § 1493.130(a)(11), certifies that: (a) The agricultural commodity or product exported under the Payment Guarantee is a U.S. Agricultural Commodity; (b) The U.S. Agricultural Commodity was shipped directly to the country or region specified on the Payment Guarantee; (c) There have not been any corrupt payments or extra sales services or other items extraneous to the transaction provided, financed, or guaranteed in connection with the export sale, and that the export sale complies with applicable United States law, including the Foreign Corrupt Practices Act of 1977 and other anti-bribery measures; (d) If the Exporter has not assigned the Payment Guarantee to a U.S. Financial Institution, the Exporter has verified that the Foreign Financial Institution, at the time of submission of the evidence of export report, is not present as an excluded party on the SAM list; (e) The transaction is an Eligible Export Sale; and (f) The information provided pursuant to §§ 1493.30 and 1493.70 has not changed (except as agreed to and amended by CCC) and the Exporter still meets all of the qualification requirements of § 1493.30. § 1493.150 Proof of entry. (a) Diversion. (b) Records of proof of entry. (i) That the U.S. Agricultural Commodity entered the importing country or region; (ii) The identification of the export carrier; (iii) The quantity of the U.S. Agricultural Commodity; (iv) The kind, type, grade and/or class of the U.S. Agricultural Commodity; and (v) The date(s) and place(s) of unloading of the U.S. Agricultural Commodity in the importing country or region. (2) Where shipping documents (e.g., bills of lading) clearly demonstrate that the U.S. Agricultural Commodities were shipped to the destination country or region, proof of entry verification may be provided by the Importer. § 1493.160 Notice of default. (a) Notice of default. (1) Payment Guarantee number; (2) Name of the country or region as shown on the Payment Guarantee; (3) Name of the defaulting Foreign Financial Institution; (4) Payment due date; (5) Total amount of the defaulted payment due, indicating separately the amounts for principal and Ordinary Interest, and including a copy of the repayment schedule with due dates, principal amounts and Ordinary Interest rates for each installment; (6) Date of the Foreign Financial Institution's refusal to pay, if applicable; (7) Reason for the Foreign Financial Institution's refusal to pay, if known, and copies of any correspondence with the Foreign Financial Institution regarding the default. (b) Failure to comply with time limit for submission. (c) Impact of a default on other existing Payment Guarantees. (2) If CCC withdraws coverage of the defaulting Foreign Financial Institution, CCC will permit the Exporter (with concurrence of the Assignee, if any) to utilize another approved Foreign Financial Institution, and will consider other requested amendments to the Payment Guarantee, for the balance of the export sale covered by the Payment Guarantee. If no alternate Foreign Financial Institution is identified to issue the Letter of Credit within 30 calendar days, CCC will cancel the Payment Guarantee and refund the Exporter's guarantee fees corresponding to any unutilized portion of the Payment Guarantee. § 1493.170 Claims for default. (a) Filing a claim. (1) An original cover document signed by the Holder of the Payment Guarantee and containing the following information: (i) Payment Guarantee number; (ii) A description of: (A) Any payments from or on behalf of the defaulting party or otherwise related to the defaulted payment that were received by the Exporter or the Assignee prior to submission of the claim; and (B) Any security, insurance, or collateral arrangements, whether or not any payment has been realized from such security, insurance, or collateral arrangement as of the time of claim, from or on behalf of the defaulting party or otherwise related to the defaulted payment. (iii) The following certifications: (A) A certification that the scheduled payment has not been received, listing separately scheduled principal and Ordinary Interest; (B) A certification of the amount of the defaulted payment, indicating separately the amounts for defaulted principal and Ordinary Interest; (C) A certification that all documents submitted under paragraph (a)(3) of this section are true and correct copies; and (D) A certification that all documents conforming with the requirements for payment under the Foreign Financial Institution Letter of Credit have been submitted to the negotiating bank or directly to the Foreign Financial Institution under such Letter of Credit. (2) An original instrument, in form and substance satisfactory to CCC, subrogating to CCC the respective rights of the Holder of the Payment Guarantee to the amount of payment in default under the applicable export sale. The instrument must reference the applicable Foreign Financial Institution Letter of Credit and, if applicable, the Terms and Conditions Document; and (3) A copy of each of the following documents: (i) The repayment schedule with due dates, principal amounts and Ordinary Interest rates for each installment (if the Ordinary Interest rates for future payments are unknown at the time the claim for default is submitted, provide estimates of such rates); (ii)(A) The Foreign Financial Institution Letter of Credit securing the export sale; and (B) If applicable, the Terms and Conditions Document; (iii) Depending upon the method of shipment, the ocean carrier or intermodal bill(s) of lading signed by the shipping company with the onboard ocean carrier date for each shipment, the airway bill, or, if shipped by rail or truck, the bill of lading and the entry certificate or similar document signed by an official of the importing country. If the transaction utilizes electronic bill(s) of lading (e-BL), a print-out of the e-BL from electronic system with an electronic signature is acceptable; (iv)(A) The Exporter's invoice showing, as applicable, the FAS, FCA, FOB, CFR or CIF values; or (B) If there was an Intervening Purchaser, both the Exporter's invoice to the Intervening Purchaser and the Intervening Purchaser's invoice to the Importer; (v) The evidence of export report(s) previously submitted by the Exporter to CCC in conformity with the requirements of § 1493.130(a); and (vi) If the defaulted payment was part of a transaction executed under a Repurchase Agreement, written evidence that the repurchase occurred as required under § 1493.120(f)(1)(ii). (b) Additional documents. (c) Subsequent claims for defaults on installments. (d) Alternative satisfaction of Payment Guarantees. § 1493.180 Payment for default. (a) Determination of CCC's liability. (b) Amount of CCC's liability. (1) The Guaranteed Value as stated in the Payment Guarantee, plus Eligible Interest, less any payments received or funds realized from insurance, security or collateral arrangements prior to claim by the Exporter or the Assignee from or on behalf of the defaulting party or otherwise related to the obligation in default (other than payments between CCC, the Exporter or the Assignee); or (2) The guaranteed percentage (as indicated in the Payment Guarantee) of the Exported Value indicated in the evidence of export, plus Eligible Interest, less any payments received or funds realized from insurance, security or collateral arrangements prior to claim by the Exporter or the Assignee from or on behalf of the defaulting party or otherwise related to the obligation in default (other than payments between CCC, the Exporter or the Assignee). (c) CCC Late Interest. (d) Accelerated payments. (e) Action against the Assignee. § 1493.190 Recovery of defaulted payments. (a) Notification. (b) Receipt of monies. (2) If CCC recovers monies that should be applied to a Payment Guarantee for which a claim has been paid by CCC, CCC will pay the Holder of the Payment Guarantee its pro rata share, if any, provided that the required information necessary for determining pro rata distribution has been furnished. If a required payment is not made by CCC within 15 Business Days from the date of recovery or 15 business days from receiving the required information for determining pro rata distribution, whichever is later, CCC will pay interest calculated at a rate equal to the latest average investment rate of the most recent Treasury 91-day bill auction, as announced by the Department of Treasury, in effect on the date of recovery and interest will accrue from such date to the date of payment by CCC. The interest will apply only to the portion of the recovery payable to the Holder of the Payment Guarantee. (c) Allocation of recoveries. (d) Liabilities to CCC. (1) The Exporter will be liable to CCC when and if it is determined by CCC that the Exporter has engaged in fraud, or has been or is in material breach of any contractual obligation, certification or warranty made by the Exporter for the purpose of obtaining the Payment Guarantee or for fulfilling obligations under the GSM-102 program; and (2) The Assignee will be liable to CCC when and if it is determined by CCC that the Assignee has engaged in fraud or otherwise violated program requirements. (e) Cooperation in recoveries. § 1493.191 Additional obligations and requirements. (a) Maintenance of records, access to premises, and responding to CCC inquiries. (b) Responsibility of program participants. (c) Submission of documents by Principals. (d) Misstatements or noncompliance by Exporter may lead to rescission of Payment Guarantee. § 1493.192 Dispute resolution and appeals. (a) Dispute resolution. (2) The Exporter or the Assignee may seek reconsideration of a determination made by the Director by submitting a letter requesting reconsideration to the Director within 30 calendar days of the date of the determination. For the purposes of this section, the date of a determination will be the date of the letter or other means of notification to the Exporter or the Assignee of the determination. The Exporter or the Assignee may include with the letter requesting reconsideration any additional information that it wishes the Director to consider in reviewing its request. The Director will respond to the request for reconsideration within 30 calendar days of the date on which the request or the final documentary evidence submitted by the Exporter or the Assignee is received by the Director, whichever is later, unless the Director extends the time permitted for response. If the Exporter or the Assignee fails to request reconsideration of a determination by the Director, then the determination of the Director will be deemed final. (3) If the Exporter or the Assignee requests reconsideration of a determination by the Director pursuant to paragraph (a)(2) of this section, and the Director upholds the original determination, then the Exporter or the Assignee may appeal the Director's final determination to the GSM in accordance with the procedures set forth in paragraph (b) of this section. If the Exporter or the Assignee fails to appeal the Director's final determination within 30 calendar days as provided in paragraph (b)(1) of this section, then the Director's decision becomes the final determination of CCC. (b) Appeal procedures. (2) If the Exporter or Assignee does not request an administrative hearing, the Exporter or Assignee must indicate in its appeal letter whether or not it will submit any additional written information or documentation for the GSM to consider in acting upon its appeal. This information or documentation must be submitted to the GSM within 30 calendar days of the date of the appeal letter to the GSM. The GSM will make a decision regarding the appeal based upon the information contained in the administrative record. The GSM will issue his or her written decision within 60 calendar days of the latter of the date on which the GSM receives the appeal or the date that final documentary evidence is submitted by the Exporter or Assignee to the GSM. (3) If the Exporter or the Assignee has requested an administrative hearing, the GSM will set a date and time for the hearing that is mutually convenient for the GSM and the Exporter or Assignee. This date will ordinarily be within 60 calendar days of the date on which the GSM receives the request for a hearing. The hearing will be an informal procedure. The Exporter or Assignee and/or its counsel may present any relevant testimony or documentary evidence to the GSM. A transcript of the hearing will not ordinarily be prepared unless the Exporter or Assignee bears the costs involved in preparing the transcript, although the GSM may decide to have a transcript prepared at the expense of the Government. The GSM will make a decision regarding the appeal based upon the information contained in the administrative record. The GSM will issue his or her written decision within 60 calendar days of the latter of the date of the hearing or the date of receipt of the transcript, if one is to be prepared. (4) The decision of the GSM will be the final determination of CCC. The Exporter or Assignee will be entitled to no further administrative appellate rights. (c) Failure to comply with determination. (d) Exporter's obligation to perform. § 1493.195 Miscellaneous provisions. (a) Officials not to benefit. (b) OMB control number assigned pursuant to the Paperwork Reduction Act. Subpart C—CCC Facility Guarantee Program (FGP) Operations Source: 81 FR 65515, Sept. 22, 2016, unless otherwise noted. § 1493.200 General statement. (a) Overview. (b) Program administration. § 1493.210 Definition of terms. Terms set forth in this part, on the USDA Web site (including in program announcements and notices to participants), and in any CCC-originated documents pertaining to the FGP will have the following meanings: Affiliate. Assignee. Business day. Buyer. Buyer's representative. CCC. et seq. CCC late interest. Contractual event. Cost of services. Coverage waiver. Date of performance. Date of sale. Destination country. Director. Discounts and allowances. Eligible export sale. Eligible imported components. (1) The transaction meets the U.S. content test in § 1493.290(e); or (2) A coverage waiver of the U.S. content test has been requested by the seller and approved by CCC. Eligible non-U.S. goods. Eligible interest. (1) The amount calculated using the interest rate agreed by the holder of the payment guarantee and the foreign financial institution; or (2) The amount calculated using the specified percentage of the Treasury bill investment rate set forth on the face of the payment guarantee. Emerging market. (1) Is taking steps toward a market-oriented economy through the food, agriculture, or rural business sectors of the economy of the country; and (2) has the potential to provide a viable and significant market for U.S. agricultural commodities or products. Environmental and Social Impact Assessment (ESIA). Firm sales contract. (1) Date of sale; (2) A complete description of all goods associated with the transaction. For goods to be covered by the payment guarantee, include the brand name and model number, country where the good was manufactured and country from which the good will be exported (if applicable), quantity, value, and Incoterms (if applicable); (3) A complete description of all services associated with the transaction. For services to be covered by the payment guarantee, include the supplier and cost; (4) The date of performance of each contractual event; and (5) Evidence of agreement between buyer and seller. Foreign financial institution. (1) Organized and licensed under the laws of a jurisdiction outside the United States; (2) Not domiciled in the United States; and (3) Subject to the banking or other financial regulatory authority of a foreign jurisdiction (except for multilateral and sovereign institutions). Foreign financial institution letter of credit or letter of credit. GSM. Guaranteed value. Holder of the payment guarantee. Incoterms. Initial payment. Letter of interest. Local costs. Net contract value. North American Industry Classification System (NAICS). Ordinary interest. Payment guarantee. Post default interest. Preliminary environmental and social screening document or Screening document. Principal. Program announcement. Repayment obligation. Repurchase agreement. SAM Seller. Service. Terms and conditions document. Total FGP transaction value. United States or U.S. U.S. agricultural commodity or U.S. agricultural commodities. (1) (i) An agricultural commodity or product entirely produced in the United States; or (ii) A product of an agricultural commodity— (A) 90 percent or more of the agricultural components of which by weight, excluding packaging and added water, is entirely produced in the United States; and (B) That the Secretary determines to be a high value agricultural product. (2) For purposes of this definition, fish entirely produced in the United States include fish harvested by a documented fishing vessel as defined in title 46, United States Code, in waters that are not waters (including the territorial sea) of a foreign country. U.S. content test. USDA. U.S. financial institution. (1) Organized and licensed under the laws of a jurisdiction within the United States; (2) Domiciled in the United States; and (3) Subject to the banking or other financial regulatory authority jurisdiction within the United States. U.S. goods. e.g., U.S. person. (1) An individual who is a citizen or legal resident of the United States; or (2) An entity constituted or organized in the United States, including any corporation, trust partnership, sole proprietorship, joint venture, or other association with business activities in the United States. U.S. services. Value of components (also value of U.S. components, value of imported components). (1) The price stipulated in the firm sales contract or, if such price is not available; (2) The declared customs value or, if the customs value is not available; then (3) The fair market wholesale value in the United States. Value of goods (also value of U.S. goods, value of non-U.S. goods, or value of Eligible non-U.S. goods). (1) The price stipulated in the firm sales contract or, if such price is not available; (2) The declared customs value or, if the customs value is not available; then (3) The fair market wholesale value in the United States. § 1493.220 Information required for seller participation. (a) Qualification requirements. (1) For the applicant: (i) The name and full U.S. address (including the full 9-digit zip code) of the applicant's office, along with an indication of whether the address is a business or private residence. A post office box is not an acceptable address. If the applicant has multiple offices, the address included in the information should be that which is pertinent to the FGP sales contemplated by the applicant; (ii) Dun and Bradstreet (DUNS) number; (iii) Employer Identification Number (EIN—also known as a Federal Tax Identification Number); (iv) Telephone and fax numbers; (v) Email address (if applicable); (vi) Business Web site (if applicable); (vii) Contact name; (viii) Statement indicating whether the applicant is a U.S. domestic entity or a foreign entity domiciled in the United States; and (ix) The form of business entity of the applicant, ( e.g., (2) For the applicant's headquarters office: (i) The name and full address of the applicant's headquarters office (a post office box is not an acceptable address); and (ii) Telephone and fax numbers. (3) For the applicant's agent for the service of process: (i) The name and full U.S. address of the applicant's agent's office, along with an indication of whether the address is a business or private residence; (ii) Telephone and fax numbers; (iii) Email address (if applicable); and (iv) Contact name. (4) A description of the applicant's business. Applicants must provide the following information: (i) Nature of the applicant's business ( i.e., (ii) Explanation of the applicant's experience/history selling the goods or services to be sold under the FGP, including number of years involved in selling, types of goods or services sold, and destination of sales for the preceding three years; (iii) Whether or not the applicant is a “small or medium enterprise” (SME) as defined on the USDA Web site. (5) A listing of any related companies ( e.g., (6) A statement describing the applicant's participation, if any, during the past three years in U.S. Government programs, contracts or agreements; and (7) A statement that: “All certifications set forth in 7 CFR 1493.250(a) are hereby made in this application” which, when included in the application, will constitute a certification that the applicant is in compliance with all of the requirements set forth in § 1493.250(a). The applicant will be required to provide further explanation or documentation if not in compliance with these requirements or if the application does not include this statement. (b) Qualification notification. (c) Previous qualification. (d) Ineligibility for program participation. § 1493.230 Information required for U.S. financial institution participation. (a) Qualification requirements. (1) Legal name and address of the applicant; (2) Dun and Bradstreet (DUNS) number; (3) Employer Identification Number (EIN—also known as a Federal Tax Identification Number); (4) Year-end audited financial statements for the applicant's most recent fiscal year; (5) Breakdown of the applicant's ownership as follows: (i) Ten largest individual shareholders and ownership percentages; (ii) Percentage of government ownership, if any; and (iii) Identity of the legal entity or person with ultimate control or decision making authority, if other than the majority shareholder. (6) Organizational structure (independent, or a subsidiary, affiliate, or branch of another financial institution); (7) Documentation from the applicable United States Federal or State agency demonstrating that the applicant is either licensed or chartered to do business in the United States; (8) Name of the agency that regulates the applicant and the name and telephone number of the primary contact for such regulator; and (9) A statement that: “All certifications set forth in 7 CFR 1493.250 are hereby made in this application” which, when included in the application, will constitute a certification that the applicant is in compliance with all of the requirements set forth in § 1493.250. The applicant will be required to provide further explanation or documentation if not in compliance with these requirements or if the application does not include this statement. (b) Qualification notification. (c) Previous qualification. (d) Ineligibility for program participation. § 1493.240 Information required for foreign financial institution participation. (a) Qualification requirements. (1) Legal name and address of the applicant; (2) Year-end, audited financial statements in accordance with the accounting standards established by the applicant's regulators, in English, for the applicant's three most recent fiscal years. If the applicant is not subject to a banking or other financial regulatory authority, year-end, audited financial statements in accordance with prevailing accounting standards, in English, for the applicant's three most recent fiscal years; (3) Breakdown of applicant's ownership as follows: (i) Ten largest individual shareholders and ownership percentages; (ii) Percentage of government ownership, if any; and (iii) Identity of the legal entity or person with ultimate control or decision making authority, if other than the majority shareholder. (4) Organizational structure (independent, or a subsidiary, affiliate, or branch of another legal entity); (5) Name of foreign government agency that regulates the applicant; and (6) A statement that: “All certifications set forth in 7 CFR 1493.250 are hereby made in this application” which, when included in the application, will constitute a certification that the applicant is in compliance with all of the requirements set forth in § 1493.250. The applicant will be required to provide further explanation or documentation if not in compliance with these requirements or if the application does not include this statement. (b) Qualification notification. (c) Participation limit. (d) Previous qualification and submission of annual financial statements. (e) Ineligibility for program participation. (1) May be deemed ineligible to participate in the FGP if such applicant cannot provide all of the information and certifications required in § 1493.240(a); and (2) Will be deemed ineligible to participate in the FGP if, based upon information submitted by the applicant or other publicly available sources, CCC determines that the applicant cannot adequately service the debt associated with the payment guarantees issued by CCC. § 1493.250 Certifications required for program participation. (a) When making the statement required by §§ 1493.220(a)(7), 1493.230(a)(9), or 1493.240(a)(6), each seller, U.S. financial institution and foreign financial institution applicant for program participation is certifying that, to the best of its knowledge and belief: (1) The applicant and any of its principals (as defined in 2 CFR 180.995) are not presently debarred, suspended, proposed for debarment, declared ineligible, or excluded from covered transactions by any U.S. Federal department or agency; (2) The applicant and any of its principals (as defined in 2 CFR 180.995) have not within a three-year period preceding this application been convicted of or had a civil judgment rendered against them for commission of fraud or a criminal offense in connection with obtaining, attempting to obtain, or performing a public (Federal, State, or local) transaction or contract under a public transaction; violation of Federal or State antitrust statues or commission of embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements, or receiving stolen property; (3) The applicant and any of its principals (as defined in 2 CFR 180.995) are not presently indicted for or otherwise criminally or civilly charged by a governmental entity (Federal, State or local) with commission of any of the offenses enumerated in paragraph (a)(2) of this section; (4) The applicant and any of its principals (as defined in 2 CFR 180.995) have not within a three-year period preceding this application had one or more public transactions (Federal, State or local) terminated for cause or default; (5) The applicant does not have any outstanding nontax debt to the United States that is in delinquent status as provided in 31 CFR 285.13; (6) The applicant is not controlled by a person owing an outstanding nontax debt to the United States that is in delinquent status as provided in 31 CFR 285.13 ( e.g., (7) The applicant does not control a person owing an outstanding nontax debt to the United States that is in delinquent status as provided in 31 CFR 285.13 ( e.g., (b) Additional certifications for U.S. and foreign financial institution applicants. (1) The applicant and its principals are in compliance with all requirements, restrictions and guidelines as established by the applicant's regulators; and (2) All U.S. operations of the applicant and its U.S. principals are in compliance with U.S. anti-money laundering and terrorist financing statutes including, but not limited to, the USA Patriot Act of 2001 and the Foreign Corrupt Practices Act of 1977. [81 FR 65515, Sept. 22, 2016, as amended at 84 FR 28186, June 18, 2019] § 1493.260 Application for payment guarantee. (a) Letter of interest. (b) Initial application for payment guarantee. (1) Destination country. (2) The name and address of the buyer. If the buyer is not physically located in the destination country, it must have a buyer's representative in the destination country taking receipt of the goods and services covered by the payment guarantee. If applicable, provide the name and address of the buyer's representative. (3) The name and address of the party on whose request the letter of credit is issued, if other than the buyer. (4) The name and address of the end-user of the goods or services, if other than the buyer. (5) The seller's sales number pertinent to the application and a copy of the firm sales contract. (6) A description (including location, i.e., (7) List of all agricultural commodities or products (inputs) to be handled, marketed, processed, stored, or distributed by the proposed transaction after completion, and an explanation of why and how the facility or goods and/or services will specifically benefit exporters of U.S. agricultural commodities. (8) Total value of the firm sales contract. (9) A full description of each good to be covered by the payment guarantee. The goods specified in the seller's application for the payment guarantee must correspond with the description of the goods specified in the firm sales contract and the foreign financial institution letter of credit. The description must include each of the following: (i) Brand name and model number; (ii) Applicable 10-digit Harmonized System classification code; (iii) Description of the good; (iv) Country where the good was manufactured and from which the good will be exported; (v) For U.S. goods, the value of imported components used in the U.S. good's manufacture. If requesting guarantee coverage of only the U.S. components in U.S. goods, provide the value of U.S. components; (vi) For goods that are local costs, the name of the local supplier; (vii) Quantity; (viii) Value of the good; and (ix) Incoterms (if the sale of the goods is based on Incoterms delivery). (10) A full description of each U.S. service to be covered by the payment guarantee. The U.S. services specified in the seller's application for the payment guarantee must correspond with the description of the U.S. services specified in the firm sales contract and the foreign financial institution letter of credit. The description must include each of the following: (i) Description of the U.S. service; (ii) Supplier of the U.S. service; (iii) Cost of the U.S. service; and (iv) NAICS classification number. (11) A description and date of performance (or timeframe of performance if the exact date is unknown) of each contractual event, as specified in the firm sales contract. (12) Indication of whether a coverage waiver is requested in accordance with § 1493.290(f). If a coverage waiver is requested, the applicant must indicate the nature of the waiver requested per § 1493.290(f)(1) and provide the justification and explanation required by § 1493.290(f)(2). (13) Name and location of the foreign financial institution issuing the letter of credit and, upon request by CCC, written evidence that the foreign financial institution has agreed to issue the letter of credit. (14) The term length of the credit being extended and the intervals between principal payments for each contractual event under the payment guarantee. (15) If applicable, a description of any arrangements or understandings with other U.S. or foreign government agencies, or with financial institutions or entities, private or public, providing guarantees or financing to the seller or other competing sellers in connection with this sale, whether or not the goods or services are of U.S. origin or would otherwise qualify for a payment guarantee under this subpart. Copies of any documents relating to such arrangements must be provided. (16) A statement of how this transaction may encourage privatization of the agricultural sector, or benefit private farms or cooperatives, in the destination country. Include in the statement the share of any private sector ownership in the transaction. (17) An estimate of how many U.S. persons will be or have been hired because of the firm sales contract and/or how many U.S. persons are required to fulfill the firm sales contract. (18) FGP tracking number assigned to previously submitted letter of interest, if applicable. (c) Review of initial application. (i) CCC will only consider an initial application in connection with a transaction that CCC determines will benefit primarily exports of U.S. agricultural commodities. (ii) If, based upon a price review the unit sales price of any good and/or service(s) does not fall within the prevailing commercial market level ranges, as determined by CCC, the initial application will not be approved as submitted. (iii) CCC will review the preliminary environmental and social screening document submitted by the seller and, if necessary, request additional information from the seller to determine whether the transaction could have potentially significant adverse environmental and/or social impacts. If CCC determines that a transaction may have such significant adverse impacts, the seller must submit an Environmental and Social Impact Assessment (ESIA) with the final application for the payment guarantee. Alternatively, CCC may reject an initial application for payment guarantee based on the screening document and any additional information provided by the seller. (2) Once CCC indicates its approval of the initial application to the seller, the seller must submit a final application as specified in paragraph (d) of this section before CCC will make a final determination of whether to issue a payment guarantee. (d) Final application for payment guarantee. (1) FGP tracking number assigned by CCC. (2) Destination country. (3) The name and address of the buyer. (4) A description of each good and U.S. service, along with the value of the Good and Cost of the service, for which guarantee coverage is requested, based on CCC's feedback on the seller's initial application. If the seller is seeking guarantee coverage on only the U.S. components used in the assembly of U.S. goods, provide the value of the U.S. Components. (5) Net contract value. (6) Amount of the initial payment and evidence that the initial payment has been paid by the buyer to the seller. (7) Description and value of any discounts and allowances. (8) Value of approved local costs. (9) Total FGP transaction value. (10) Guaranteed value. (11) Guarantee fee. (12) The seller's statement, “All certifications set forth in § 1493.270 are hereby being made by the seller in this application” which, when included in the application by the seller, will constitute a certification that it is in compliance with all the requirements set forth in § 1493.270 with respect to both the initial and final applications. (e) Public comment. (f) Reporting. (g) Approval of final application. § 1493.270 Certification requirements for obtaining payment guarantee. By providing the statement in § 1493.260(d)(12), the seller is certifying that the information provided in the initial and final applications is true and correct and, further, that all requirements set forth in this section have been met. The seller will be required to provide further explanation or documentation with regard to final applications that do not include this statement. If the seller makes false certifications with respect to a payment guarantee, CCC will have the right, in addition to any other rights provided under this subpart or otherwise as a matter of law, to revoke guarantee coverage for any goods not yet exported and services not yet performed and/or to commence legal action and/or administrative proceedings against the seller. The seller, in submitting an application for a payment guarantee and providing the statement set forth in § 1493.260(d)(12), certifies that: (a) There have not been any corrupt payments or extra sales services or other items extraneous to the transaction provided, financed, or guaranteed in connection with the transaction, and the transaction complies with applicable United States law, including the Foreign Corrupt Practices Act of 1977 and other anti-bribery measures; (b) At the time of submission of the final application for payment guarantee, the buyer does not appear as an excluded party on the SAM list; (c) The seller is fully in compliance with the requirements of § 1493.320(b) for all existing payment guarantees issued to the seller or has requested and been granted an extension per § 1493.320(b)(3); and (d) The information provided pursuant to § 1493.220 has not changed and the seller still meets all of the qualification requirements of § 1493.220. § 1493.280 Special requirements of the foreign financial institution letter of credit and the terms and conditions document, if applicable. (a) Permitted mechanisms to document special requirements. (i) If the obligation to pay by the foreign financial institution is conditioned on shipment documentation, the letter of credit must stipulate presentation of at least one original clean on board bill of lading as a required document, unless: (A) The seller, or a related company previously reported to CCC by the seller pursuant to 1493.220(a)(5), is named as the shipper on the clean, on-board bill of lading. If the seller or a related company is named the shipper on the bill of lading, the letter of credit may stipulate a copy or photocopy of an original, clean, on-board bill of lading; or (B) The letter of credit stipulates presentation of electronic documents per paragraph (a)(1)(ii) of this section. (ii) If the letter of credit will allow for presentation of electronic documents, the letter of credit must so stipulate. (iii) If the obligation to pay by the foreign financial institution is conditioned on a contractual event requiring other than shipment documentation, the contractual event must be clearly stipulated in either the letter of credit or the terms and conditions document. (2) The use of a terms and conditions document is optional. The terms and conditions document, if any, must be specifically identified and referred to in the foreign financial institution letter of credit. (3) The special requirements in paragraph (b) of this section must be documented in one of the two following ways: (i) The special requirements may be set forth in the foreign financial institution letter of credit as a special instruction from the foreign financial institution; or (ii) The special requirements may be set forth in a separate terms and conditions document. (b) Special requirements. (1) The terms of the repayment obligation, including a specific promise by the foreign financial institution issuing the letter of credit to pay the repayment obligation; (2) The following language: “In the event that the Commodity Credit Corporation (“CCC”) is subrogated to the position of the obligee hereunder, this instrument shall be governed by and construed in accordance with the laws of the State of New York, excluding its conflict of laws principles. In such case, any legal action or proceeding arising under this instrument will be brought exclusively in the U.S. District Court for the Southern District of New York or the U.S. District Court for the District of Columbia, as determined by CCC, and such parties hereby irrevocably consent to the personal jurisdiction and venue therein.”; (3) A provision permitting the holder of the payment guarantee to declare all or any part of the repayment obligation, including accrued interest, immediately due and payable, in the event a payment default occurs under the letter of credit or, if applicable, the terms and conditions document; and (4) Post default interest terms. § 1493.290 Terms and requirements of the payment guarantee. (a) CCC's obligation. (b) Period of guarantee coverage. (c) Terms of the CCC payment guarantee. (d) Final date of performance. (e) U.S. content test. (i) The value of eligible non-U.S. goods; and (ii) The value of imported components. (2) Imported raw materials and basic manufactured items (such as iron, steel, nuts, bolts, etc.) which are processed, assembled or manufactured in the United States are automatically included in CCC's coverage and are not counted as imported components for the purpose of determining U.S. content. (f) Coverage waiver. (i) To allow for guarantee coverage of non-U.S. goods; and/or (ii) The U.S. content test, allowing for guarantee coverage of non-U.S. goods and imported components in U.S. goods in excess of the value permitted under the U.S. content test. (2) To request a coverage waiver on one of the bases specified in paragraph (f)(1) of this section, the seller must submit with the initial application for a payment guarantee a justification of why the non-U.S. goods and/or imported components in U.S. goods are essential to the completion of the FGP transaction. This justification must be based on one of the following: (i) The goods and/or components are no longer manufactured in or provided by the United States; (ii) The use of U.S. goods and/or components is not cost effective; or (iii) U.S. goods and/or components are not compatible with the existing infrastructure in the destination country. (3) In determining whether to grant a coverage waiver, CCC will consider the following factors: (i) Whether information obtained by CCC from industry sources, government agencies, or any other sources supports the justification provided by the seller; (ii) Whether the non-U.S. goods (and/or imported components in U.S. goods) are essential to the completion of the transaction; and (iii) Any other information CCC determines is relevant. (g) Certain transactions are ineligible for payment guarantees. (1) The sale includes corrupt payments or extra sales or services or other items extraneous to the transactions provided, financed, or guaranteed in connection with the transaction; (2) The sale does not comply with applicable U.S. law, including the Foreign Corrupt Practices Act of 1977 and other anti-bribery measures; (3) The buyer is excluded or disqualified from participation in U.S. government programs; (4) The goods, services, and/or facility being financed will not primarily benefit U.S. agricultural commodity exports; (5) The sale is not an eligible export sale. (h) Certain contractual events are ineligible for payment guarantee coverage. (1) Contractual events with a date of performance prior to the date of receipt by CCC of the seller's written initial application for a payment guarantee; (2) Contractual events with a date of performance later than the final date of performance shown on the payment guarantee or any amendments thereof; (3) Contractual events where the date of issuance of a foreign financial institution letter of credit is later than the date of performance; or (4) Contractual events that have been guaranteed by CCC under another payment guarantee. If CCC determines that the contractual event has been guaranteed under multiple payment guarantees (or coverage has been requested under multiple payment guarantees), CCC will determine which payment guarantee (or application for payment guarantee), if any, corresponds to an eligible export sale. (i) Additional requirements. (j) Amendments to the firm sales contract. (k) Amendments to the payment guarantee. § 1493.300 Fees. (a) Letter of interest fee. (b) Initial application fee. (c) Guarantee fee rates. (d) Calculation of guarantee fee. (e) Payment of guarantee fee. (f) Refunds of fees. § 1493.310 Assignment of the payment guarantee. (a) Requirements for assignment. (1) Made to one party acting for two or more parties; or (2) Subject to further assignment. (b) CCC to receive notice of assignment of payment guarantee. (c) Required certifications. (i) [Name of Assignee] has verified that the foreign financial institution, at the time of submission of the notice of assignment, does not appear as an excluded party on the SAM list; and (ii) To the best of my knowledge and belief, the information provided pursuant to § 1493.230 has not changed and [name of Assignee] still meets all of the qualification requirements of § 1493.230.” (2) If the assignee makes a false certification with respect to a payment guarantee, CCC may, in its sole discretion, in addition to any other action available as a matter of law, rescind and cancel the payment guarantee, reject the assignment of the payment guarantee, and/or commence legal action and/or administrative proceedings against the assignee. (d) Notice of ineligibility to receive assignment. (e) Ineligibility of U.S. financial institutions to receive an assignment and proceeds. (1) At the time of assignment of a payment guarantee, is not in compliance with all requirements of § 1493.230(a); or (2) Is the branch, agency, or subsidiary of the foreign financial institution issuing the letter of credit; or (3) Is owned or controlled by an entity that owns or controls the foreign financial institution issuing the letter of credit; or (4) Is the U.S. parent of the foreign financial institution issuing the foreign financial institution letter of credit; or (5) Is owned or controlled by the government of a foreign country and the payment guarantee has been issued in connection with sales of goods or services to buyers located in such foreign country. (f) Repurchase agreements. (i) Any repurchase under a repurchase agreement by the holder of the payment guarantee must be for the entirety of outstanding balance under the associated repayment obligation; (ii) In the event of default with respect to the repayment obligation subject to a repurchase agreement, the holder of the payment guarantee must immediately effect such repurchase; and (iii) The holder of the payment guarantee must file all documentation required by §§ 1493.350 and 1493.360 in case of a default by the foreign financial institution under the payment guarantee. (2) The holder of the payment guarantee shall, within five business days of execution of a transaction under the repurchase agreement, notify CCC of the transaction in writing in the manner specified on the USDA Web site. Such notification must include the following information: (i) Name and address of the other party to the repurchase agreement; (ii) A statement indicating whether the transaction executed under the repurchase agreement is for a fixed term or if it is terminable upon demand by either party. If fixed, provide the purchase date and the agreed upon date for repurchase. If terminable on demand, provide the purchase date only; and (iii) The following written certification: “[Name of holder of the payment guarantee] has entered into a repurchase agreement that meets the provisions of 7 CFR 1493.310(f)(1) and, prior to entering into this agreement, verified that [name of other party to the repurchase agreement] does not appear as an excluded party on the SAM list.” (3) Failure of the holder of the payment guarantee to comply with any of the provisions of § 1493.310(f) may result in CCC annulling coverage on the foreign financial institution letter of credit and Terms and Condition Document, if applicable, covered by the payment guarantee. § 1493.320 Evidence of performance. (a) Report of performance. (1) Payment guarantee number; (2) Evidence of performance report number ( e.g., (3) Date of performance; (4) Seller's firm sales contract number; (5) Detailed description of the contractual event. For goods, include the applicable 10-digit Harmonized System classification code and the quantity; (6) Net contract value of the contractual event covered by the payment guarantee; (7) Amount of initial payment corresponding to the contractual event; (8) Description and value of discounts and allowances, if any; (9) Value of approved local costs corresponding to the contractual event, if any; (10) Total FGP transaction value; (11) Guaranteed value of contractual event; (12) The seller's statement, “All certifications set forth in § 1493.330 are hereby made by the seller in this evidence of performance” which, when included in the evidence of performance by the seller, will constitute a certification that it is in compliance with all the requirements set forth in § 1493.330; and (13) In addition to all of the above information, the final evidence of performance report for the payment guarantee must include the following: (i) The statement “All contractual events under the payment guarantee have been completed.” (ii) A statement summarizing the total value of all contractual events covered under the payment guarantee ( i.e., (b) Time limit for submission of evidence of performance. (2) If at any time the seller determines that no contractual events are to occur under a payment guarantee, the seller is required to notify CCC in writing no later than the final date of performance specified on the payment guarantee by furnishing the payment guarantee number and stating “No contractual events will occur under the payment guarantee.” (3) Requests for an extension of the time limit for submitting an evidence of performance report must be submitted in writing by the seller to the Director and must include an explanation of why the extension is needed. An extension of the time limit may be granted if such extension is requested prior to the expiration of the time limit for filing and is determined by the Director to be in the best interests of CCC. (c) Failure to comply with time limits for submission. § 1493.330 Certification requirements for the evidence of performance. By providing the statement contained in § 1493.320(a)(12), the seller is certifying that the information provided in the evidence of performance report is true and correct and, further, that all requirements set forth in this section have been met. The seller will be required to provide further explanation or documentation with regard to reports that do not include this statement. If the seller makes false certifications with respect to a payment guarantee, CCC will have the right, in addition to any other rights provided under this subpart or otherwise as a matter of law, to annul guarantee coverage for any contractual events that have not yet occurred and/or to commence legal action and/or administrative proceedings against the seller. The seller, in submitting the evidence of performance and providing the statement set forth in § 1493.320(a)(12), certifies that: (a) The specifications and/or quantity of the contractual event conform with the information contained in the seller's application for payment guarantee and firm sales contract, or if different, CCC has approved such changes; (b) A foreign financial institution letter of credit has been opened in favor of the seller by the foreign financial institution shown on the payment guarantee to cover the dollar amount of the contractual event covered by the payment guarantee, less the initial payment and less discounts and allowances; (c) There have not been any corrupt payments or extra sales services or other items extraneous to the transaction provided, financed, or guaranteed in connection with the transaction, and that the transaction complies with applicable United States law, including the Foreign Corrupt Practices Act of 1977 and other anti-bribery measures; (d) If the seller has not assigned the payment guarantee to a U.S. financial institution, the seller has verified that the foreign financial institution, at the time of submission of the evidence of performance report, does not appear as an excluded party on the SAM list; and (e) The information provided pursuant to §§ 1493.220 and 1493.260 has not changed (except as agreed to and amended by CCC) and the seller still meets all of the qualification requirements of § 1493.220. § 1493.340 Proof of entry. (a) Diversion. (b) Records of proof of entry. (i) That the good(s) entered the destination country; (ii) The identification of the export carrier; (iii) The quantity of the good(s); (iv) A description of the good(s); and (v) The date(s) and place(s) of unloading of the good(s) in the destination country. (2) Where shipping documents ( e.g., § 1493.350 Notice of default. (a) Notice of default. (1) Payment guarantee number; (2) Name of the destination country as shown on the payment guarantee; (3) Name of the defaulting foreign financial institution; (4) Payment due date; (5) Total amount of the defaulted payment due, indicating separately the amounts for principal and ordinary interest, and including a copy of the repayment schedule with due dates, principal amounts and ordinary interest rates for each installment; (6) Date of foreign financial institution's refusal to pay, if applicable; (7) Reason for foreign financial institution's refusal to pay, if known, and copies of any correspondence with the foreign financial institution regarding the default. (b) Failure to comply with time limit for submission. (c) Impact of a default on other existing payment guarantees. (1) In the event that a foreign financial institution defaults under a repayment obligation under this subpart or under 7 CFR 1493, subpart B, CCC may declare that such foreign financial institution is no longer eligible to provide additional Letters of Credit under the FGP. If CCC determines that such defaulting foreign financial institution is no longer eligible for the FGP, CCC shall provide written notice of such ineligibility to all sellers and assignees, if any, having payment guarantees covering transactions with respect to which the defaulting foreign financial institution is expected to issue a letter of credit. Receipt of written notice from CCC that a defaulting foreign financial institution is no longer eligible to provide additional Letters of Credit under the FGP shall constitute withdrawal of coverage of that foreign financial institution under all payment guarantees with respect to any letter of credit issued on or after the date of receipt of such written notice. CCC will not withdraw coverage of the defaulting foreign financial institution under any payment guarantee with respect to any letter of credit issued before the date of receipt of such written notice. (2) If CCC withdraws coverage of the defaulting foreign financial institution, CCC will permit the seller (with concurrence of the assignee, if any) to utilize another approved foreign financial institution, and will consider other requested amendments to the payment guarantee, for the balance of the transaction covered by the payment guarantee. If no alternate foreign financial institution is identified to issue the letter of credit within 30 calendar days, CCC will cancel the payment guarantee and refund the seller's guarantee fees corresponding to any unutilized portion of the payment guarantee. § 1493.360 Claims for default. (a) Filing a claim. (1) An original cover letter signed by the holder of the payment guarantee and containing the following information: (i) Payment guarantee number; (ii) A description of: (A) Any payments from or on behalf of the defaulting party or otherwise related to the defaulted payment that were received by the seller or the assignee prior to submission of the claim; and (B) Any security, insurance, or collateral arrangements, whether or not any payment has been realized from such security, insurance, or collateral arrangement as of the time of claim, from or on behalf of the defaulting party or otherwise related to the defaulted payment. (iii) The following certifications: (A) A certification that the defaulted payment has not been received (or, alternatively, specifying the portion of the scheduled payment that has not been received), listing separately scheduled principal and ordinary interest; (B) A certification of the amount of the defaulted payment, indicating separately the amounts for defaulted principal and ordinary interest; (C) A certification that all documents submitted under paragraph (a)(3) of this section are true and correct copies; and (D) A certification that all documents conforming with the requirements for payment under the foreign financial institution letter of credit have been submitted to the negotiating bank or directly to the foreign financial institution under such letter of credit. (2) An original instrument, in form and substance satisfactory to CCC, subrogating to CCC the respective rights of the holder of the payment guarantee to the amount of payment in default under the applicable sale. The instrument must reference the applicable foreign financial institution letter of credit and, if applicable, the terms and conditions document; and (3) A copy of each of the following documents: (i) The repayment schedule with due dates, principal amounts and ordinary interest rates for each installment (if the ordinary interest rates for future payments are unknown at the time of the claim for default is submitted, provide estimates of such rates); (ii) (A) The foreign financial institution letter of credit securing the sale; and (B) If applicable, the terms and conditions document; (iii) For goods, depending upon the method of shipment, the ocean carrier or intermodal bill(s) of lading signed by the shipping company with the onboard ocean carrier date for each shipment, the airway bill, or, if shipped by rail or truck, the bill of lading and the entry certificate or similar document signed by an official of the destination country. If the transaction utilizes electronic bill(s) of lading (e-BL), a print-out of the e-BL from electronic system with an electronic signature is acceptable; (iv) The seller's invoice. For shipment of goods, the invoice must show the applicable Incoterms; (v) The evidence of performance report(s) previously submitted by the seller to CCC in conformity with the requirements of § 1493.320(a); and (vi) If the defaulted payment was part of a transaction executed under a repurchase agreement, written evidence that the repurchase occurred as required under § 1493.310(f)(1)(ii). (b) Additional documents. (c) Subsequent claims for defaults on installments. (d) Alternative satisfaction of payment guarantees. § 1493.370 Payment for default. (a) Determination of CCC's liability. (b) Amount of CCC's liability. (1) The guaranteed value as stated in the payment guarantee, plus Eligible interest, less any payments received or funds realized from insurance, security or collateral arrangements prior to claim by the seller or the assignee from or on behalf of the defaulting party or otherwise related to the obligation in default (other than payments between CCC, the seller or the assignee); or (2) The guaranteed percentage (as indicated in the payment guarantee) of the value of the contractual event indicated in the evidence of performance, plus eligible interest, less any payments received or funds realized from insurance, security or collateral arrangements prior to claim by the seller or the assignee from or on behalf of the defaulting party or otherwise related to the obligation in default (other than payments between CCC, the seller or the assignee). (c) CCC late interest. (d) Accelerated payments. (e) Action against the assignee. § 1493.380 Recovery of defaulted payments. (a) Notification. (b) Receipt of monies. (2) If CCC recovers monies that should be applied to a payment guarantee for which a claim has been paid by CCC, CCC will pay the holder of the payment guarantee its pro rata share if any, provided that the required information necessary for determining pro rata distribution has been furnished. If a required payment is not made by CCC within 15 business days from the date of recovery or 15 business days from receiving the required information for determining pro rata distribution, whichever is later, CCC will pay interest calculated at a rate equal to the latest average investment rate of the most recent Treasury 91-day bill auction, as announced by the Department of Treasury, in effect on the date of recovery, and interest will accrue from such date to the date of payment by CCC. The interest will apply only to the portion of the recovery payable to the holder of the payment guarantee. (c) Allocation of recoveries. (d) Liabilities to CCC. (1) The seller will be liable to CCC when and if it is determined by CCC that the seller has engaged in fraud, or has been or is in material breach of any contractual obligation, certification or warranty made by the seller for the purpose of obtaining the payment guarantee or for fulfilling obligations under the FGP; and (2) The assignee will be liable to CCC when and if it is determined by CCC that the assignee has engaged in fraud or otherwise violated program requirements. (e) Cooperation in recoveries. § 1493.385 Additional obligations and requirements. (a) Maintenance of records and access to premises, and responding to CCC inquiries. (b) Responsibility of program participants. (c) Submission of documents by principals. i.e., (d) Misstatements or noncompliance by seller may lead to rescission of payment guarantee. § 1493.390 Dispute resolution and appeals. (a) Dispute resolution. (2) The seller or the assignee may seek reconsideration of a determination made by the Director by submitting a letter requesting reconsideration to the Director within 30 calendar days of the date of the determination. For the purposes of this section, the date of a determination will be the date of the letter or other means of notification to the seller or the assignee of the determination. The seller or the assignee may include with the letter requesting reconsideration any additional information that it wishes the Director to consider in reviewing its request. The Director will respond to the request for reconsideration within 30 calendar days of the date on which the request or the final documentary evidence submitted by the seller or the assignee is received by the Director, whichever is later, unless the Director extends the time permitted for response. If the seller or the assignee fails to request reconsideration of a determination by the Director within 30 calendar days of the date of the determination, then the determination of the Director will be deemed final. (3) If the seller or the assignee requests reconsideration of a determination by the Director pursuant to subparagraph (a)(2) of this section, and the Director upholds the original determination, then the seller or the assignee may appeal the Director's final determination to the GSM in accordance with the procedures set forth in paragraph (b) of this section. If the seller or the assignee fails to appeal the Director's final determination within 30 calendar days, as provided in § 1493.390(b)(1), then the Director's decision becomes the final determination of CCC. (b) Appeal procedures. (2) If the seller or the assignee does not request an administrative hearing, the seller or the assignee must indicate in its appeal letter whether or not it will submit any additional written information or documentation for the GSM to consider in acting upon its appeal. This information or documentation must be submitted to the GSM within 30 calendar days of the date of the appeal letter to the GSM. The GSM will make a decision regarding the appeal based upon the information contained in the administrative record. The GSM will issue his or her written decision within 60 calendar days of the latter of the date on which the GSM receives the appeal or the date that final documentary evidence is submitted by the seller or the assignee to the GSM. (3) If the seller or the assignee has requested an administrative hearing, the GSM will set a date and time for the hearing that is mutually convenient for the GSM and the seller or the assignee. This date will ordinarily be within 60 calendar days of the date on which the GSM receives the request for a hearing. The hearing will be an informal procedure. The seller or the assignee and/or its counsel may present any relevant testimony or documentary evidence to the GSM. A transcript of the hearing will not ordinarily be prepared unless the seller or the assignee bears the costs involved in preparing the transcript, although the GSM may decide to have a transcript prepared at the expense of the Government. The GSM will make a decision regarding the appeal based upon the information contained in the administrative record. The GSM will issue his or her written decision within 60 calendar days of the latter of the date of the hearing or the date of receipt of the transcript, if one is to be prepared. (4) The decision of the GSM will be the final determination of CCC. The seller or the assignee will be entitled to no further administrative appellate rights. (c) Failure to comply with determination. (d) Seller's obligation to perform. § 1493.395 Miscellaneous provisions. (a) Officials not to benefit. (b) OMB control number assigned pursuant to the Paperwork Reduction Act. Subpart D—CCC Supplier Credit Guarantee Program Operations Source: 61 FR 33831, July 1, 1996, unless otherwise noted. § 1493.400 General statement. (a) Overview. (2) The SCGP operates in cases where credit is necessary to increase or maintain U.S. exports to a foreign market and where private U.S. exporters would be unwilling to provide financing without CCC's guarantee. The program is operated in a manner intended not to interfere with markets for cash sales. The program is targeted toward those countries where the guarantees are necessary to secure financing of the exports but which have sufficient financial strength so that foreign exchange will be available for scheduled payments. In providing this credit guarantee facility, CCC seeks to expand market opportunities for U.S. agricultural exporters and assist long-term market development for U.S. agricultural commodities. (3) The credit facility created by this program is the SCGP payment guarantee (payment guarantee). The payment guarantee is an agreement by CCC to pay the exporter, or the U.S. financial institution that may take assignment of the exporter's right to proceeds, specified amounts of principal and, where applicable, interest due from, but not paid by, the importer incurring the obligation in connection with the export sale to which CCC's guarantee coverage pertains. By approving an exporter's application for a payment guarantee, CCC encourages private sector, rather than government, financing and incurs a substantial portion of the risk of default by the importer. CCC assumes this risk, in order to be able to operate the program for the purposes specified in § 1493.2. (b) Credit facility mechanism. (2) The exporter may assign the right to proceeds under the importer obligation to a U.S. bank or other financial institution so that the exporter may realize the proceeds of the sale prior to the deferred payment date(s) as set forth in the importer obligation. (3) The SCGP payment guarantee is designed to protect the exporter or the exporter's assignee against those losses specified in the payment guarantee resulting from defaults, whether for commercial or noncommercial reasons, by the importer under the importer's obligation. (c) Program administration. (d) Country allocations and program announcements. § 1493.410 Definition of terms. Terms set forth in this subpart and in CCC Program Announcements, Notices to Participants, and any other CCC-originated documents pertaining to the SCGP will have the following meanings: (a) Assignee. (b) CCC. et seq. (c) Contacts P/R. (d) Date of export. (e) Date of sale. (f) Discounts and allowances. (g) Eligible interest. (h) Exported value. (i) Where the commodity is sold on a FAS or FOB basis, the value, FAS or FOB basis, U.S. point of export, of the export sale, reduced by the value of any discounts or allowances granted to the importer in connection with such sale; or (ii) Where the commodity was sold on a CFR or CIF basis, point of entry, the value of the export sale, FAS or FOB, point of export, is measured by the CFR or CIF value of the agricultural commodity less the cost of ocean freight, as determined at the time of application and, in the case of CIF sales, less the cost of marine and war risk insurance, as determined at the time of application, reduced by the value of any discounts or allowances granted to the importer in connection with the sale of the commodity; or (2) Where CCC announces coverage on a CFR or CIF basis, and where the commodity is sold on a CFR or CIF basis, point of entry, the total value of the export sale, CFR or CIF basis, point of entry, reduced by the value of any discounts or allowances granted to the importer in connection with the sale of the commodity. (3) When a CFR or CIF commodity export sale involves the performance of non-freight services to be performed outside the United States (e.g., services such as bagging bulk cargo) which are not normally included in ocean freight contracts, the value of such services and any related materials not exported from the U.S. with the commodity must also be deducted from the CFR or CIF sales price in determining the exported value. (i) Exporter. (j) FAS/USDA. (k) GSM. (l) Guaranteed value. (m) Importer. (n) Importer obligation. (o) Incoterms. © (1) Free Alongside Ship (FAS); (2) Free on Board (FOB); (3) Cost and Freight (CFR, or alternatively, C&F, C and F, or CNF); and (4) Cost Insurance and Freight (CIF). (p) Intervening purchaser. (q) Late interest. (r) Notice to participants. (s) Payment guarantee. (t) Port value. (i) Where the commodity is sold on a FAS or FOB basis, U.S. point of export, the value, FAS or FOB basis, U.S. point of export, of the export sale, including the upward tolerance, if any, as provided by the export sales contract, reduced by the value of any discounts or allowances granted to the importer in connection with such sale; or (ii) Where the commodity was sold on a CFR or CIF basis, point of entry, the value of the export sale, FAS or FOB, point of export, including the upward tolerance, if any, as provided by the export sales contract, is measured by the CFR or CIF value of the agricultural commodity less the value of ocean freight and, in the case of CIF sales, less the value of marine and war risk insurance, reduced by the value of any discounts or allowances granted to the importer in connection with the sale of the commodity; or (2) Where CCC announces coverage on a CFR or CIF basis and where the commodity was sold on CFR or CIF basis, point of entry, the total value of the export sale, CFR or CIF basis, point of entry, including the upward tolerance, if any, as provided by the export sales contract, reduced by the value of any discounts or allowances granted to the importer in connection with the sale of the commodity. (3) When a CFR or CIF commodity export sale involves the performance of non-freight services to be performed outside the United States (e.g., services such as bagging bulk cargo), which are not normally included in ocean freight contracts, the value of such services and any related materials not exported from the U.S. with the commodity must also be deducted from the CFR or CIF sales price in determining the port value. (u) Program announcement. (v) SCGP. (w) United States or U.S. (x) U.S. agricultural commodity. (2) A product of an agricultural commodity— (i) 90 percent or more of the agricultural components of which by weight, excluding packaging and added water, is entirely produced in the United States; and (ii) That the Secretary determines to be a high value agricultural product. For purposes of this definition, fish entirely produced in the United States include fish harvested by a documented fishing vessel as defined in title 46, United States Code, in waters that are not waters (including the territorial sea) of a foreign country. (y) USDA. [61 FR 33831, July 1, 1996, as amended at 62 FR 24561, May 6, 1997] § 1493.420 Information required for program participation. Before CCC will accept an application for a payment guarantee under the SCGP, the applicant must qualify for participation in this program. Based upon the information submitted by the applicant and other publicly available sources, CCC will determine whether the applicant is eligible for participation in the program. (a) Submission of documentation. (1) The address of the applicant's headquarters office and the name and address of an agent in the U.S. for the service of process; (2) The legal form of doing business of the applicant, e.g., sole proprietorship, partnership, corporation, etc.; (3) The place of incorporation of the applicant, if the applicant is a corporation; (4) The name and U.S. address of the office(s) of the applicant, and statement indicating whether the applicant is a U.S. domestic corporation, a foreign corporation or another foreign entity. If the applicant has multiple offices, the address included in the information should be that which is pertinent to the particular export sale contemplated by the applicant under this subpart; (5) A certified statement describing the applicant's participation, if any, during the past three years in U.S. Government programs, contracts or agreements; and (6) A certification that: “I certify, to the best of my knowledge and belief, that neither [name of applicant] nor any of its principals has been debarred, suspended, or proposed for debarment from contracting with or participating in programs administered by any U.S. Government agency. [”Principals,” for the purpose of this certification, means officers; directors; owners of five percent or more of stock; partners; and persons having primary management or supervisory responsibility within a business entity (e.g., general manager, plant manager, head of a subsidiary division, or business segment, and similar positions).] I further agree that, should any such debarment, suspension, or notice of proposed debarment occur in the future, [name of applicant] will immediately notify CCC.” (b) Previous qualification. (c) Additional submissions. (d) Ineligibility for program participation. (1) Such applicant is currently debarred, suspended, or proposed for debarment from contracting with or participating in any program administered by a U.S. Government agency; or (2) Such applicant is controlled or can be controlled, in whole or in part, by any individuals or entities currently debarred, suspended or proposed for debarment from contracting with or participating in programs administered by any U.S. Government agency. § 1493.430 Application for a payment guarantee. (a) A firm export sale must exist before an exporter may submit an application for a payment guarantee. An application for a payment guarantee may be submitted in writing or may be made by telephone, but, if made by telephone, it must be confirmed in writing to the office specified in the Contacts P/R. An application must identify the name and address of the exporter and include the following information: (1) Name of the destination country; (2) Name and address of the importer; (3) Name and address of the intervening purchaser, if any, and a statement that the commodity will be shipped directly to the importer in the destination country; (4) Date of sale; (5) Exporter's sale number; (6) Delivery period as agreed between the exporter and the importer; (7) A full description of the commodity (including packaging, if any); (8) Mean quantity, contract loading tolerance and, if the exporter chooses, a request for CCC to reserve coverage up to the maximum quantity permitted by the contract loading tolerance; (9) Unit sales price of the commodity, or a mechanism to establish the price, as agreed between the exporter and the importer. If the commodity was sold on the basis of CFR or CIF, the actual (if known at the time of application) or estimated value of freight and, in the case of sales made on a CIF basis, the actual (if known at the time of application) or estimated value of marine and war risk insurance, must be specified; (10) Description and value of discounts and allowances, if any; (11) Port value (includes upward loading tolerance, if any); (12) Guaranteed value; (13) Guarantee fee; (14) The term length for the credit being extended and the intervals between principal payments for each shipment to be made under the export sale; (15) A statement indicating whether any portion of the export sale for which the exporter is applying for a payment guarantee is also being used as the basis for an application for participation in any of the following CCC or USDA export programs: Export Enhancement Program, Dairy Export Incentive Program, Sunflowerseed Oil Assistance Program, or Cottonseed Oil Assistance Program. The number of the Agreement assigned by USDA under one of these programs should be included, as applicable; (16) Other information as requested by CCC or specified in Program Announcements and Notices to Participants, as applicable; and (17) The exporter's statement, “ALL SECTION 1493.440 CERTIFICATIONS ARE BEING MADE IN THIS APPLICATION” which, when included in the application by the exporter, will constitute a certification that it is in compliance with all the requirements set forth in § 1493.440. (b) An application for a payment guarantee may be approved as submitted, approved with modifications agreed to by the exporter, or rejected by the GSM. In the event that the application is approved, the GSM will cause a payment guarantee to be issued in favor of the exporter. Such payment guarantee will become effective at the time specified in § 1493.450(b). If, based upon a price review, the unit sales price of the commodity does not fall within the prevailing commercial market level ranges, as determined by CCC, the application will not be approved. (c) Ineligible exporter. An exporter will be ineligible to obtain a payment guarantee if such exporter: (1) Directly or indirectly owns or controls the importer; (2) Is directly or indirectly owned or controlled by the importer; or (3) Is directly or indirectly owned or controlled by a person(s) or entity(ies) which also owns or controls the importer. § 1493.440 Certification requirements for payment guarantee. By providing the statement in § 1493.430(a)(17), the exporter is certifying that the information provided in the application is true and correct and, further, that all requirements set forth in this section have been or will be met. The exporter will be required to provide further explanation or documentation with regard to applications that do not include this statement. The exporter, in submitting an application for a payment guarantee and providing the statement set forth in § 1493.430(a)(17), certifies that: (a) The agricultural commodity or product to be exported under the payment guarantee is a U.S. agricultural commodity as defined by § 1493.410(x). (b) There have not been and will not be any corrupt payments or extra sales services or other items extraneous to the transaction provided, financed, or guaranteed in connection with the transaction, and that the transaction complies with applicable United States law; (c) If the agricultural commodity is vegetable oil or a vegetable oil product, that none of the agricultural commodity or product has been or will be used as a basis for a claim of a refund, as drawback, pursuant to section 313 of the Tariff Act of 1930, 19 U.S.C. 1313, of any duty, tax or fee imposed under Federal law on an imported commodity or product; (d) No person or selling agency has been employed or retained to solicit or secure the payment guarantee, and that there is no agreement or understanding for a commission, percentage, brokerage, or contingent fee, except in the case of bona fide employees or bona fide established commercial or selling agencies maintained by the exporter for the purpose of securing business; and (e) The information provided pursuant to § 1493.420 has not changed, the exporter still meets all of the qualification requirements of § 1493.420, and the exporter will immediately notify CCC if there is a change of circumstances which would cause it to fail to meet such requirements. If the exporter breaches or violates these certifications with respect to a SCGP payment guarantee, CCC will have the right, notwithstanding any other rights provided under this subpart, to annul guarantee coverage for any commodities not yet exported and/or to proceed against the exporter. [61 FR 33831, July 1, 1996, as amended at 62 FR 24561, May 6, 1997] § 1493.450 Payment guarantee. (a) CCC's obligation. (b) Period of guarantee coverage. (c) Terms of the CCC payment guarantee. (d) Final date to export. (e) Reserve coverage for loading tolerances. i.e. (f) Ineligible exports. (g) Foreign agricultural component. (h) Additional requirements. (i) Amendments. § 1493.460 Guarantee rates and fees. (a) Guarantee fee rates. (b) Calculation of fee. (c) Payment of fee. (d) Refunds of fee. § 1493.470 Evidence of export. (a) Report of export. (1) Payment guarantee number; (2) Date of export; (3) Exporter's sale number; (4) Exported value; (5) Quantity; (6) A full description of the commodity exported; (7) Unit sales price received for the commodity exported and the basis (e.g., FOB, CFR, CIF). Where the unit sales price at export differs from the unit sales price indicated in the exporter's application for a payment guarantee, the exporter is also required to submit a statement explaining the reason for the difference; (8) Description and value of discounts and allowances, if any; (9) Number of the Agreement assigned by USDA under any other program if any portion of the export sale was also approved for participation in any of the following CCC or USDA export program: Export Enhancement Program, Dairy Export Incentive Program, Sunflowerseed Oil Assistance Program, or Cottonseed Oil Assistance Program; and (10) The exporter's statement, “ALL SECTION 1493.480 CERTIFICATIONS ARE BEING MADE IN THIS EVIDENCE OF EXPORT” which, when included in the evidence of export by the exporter, will constitute a certification that it is in compliance with all the requirements set forth in § 1493.480. (b) Time limit for submission of evidence of export. (1) Significant financial harm to CCC; (2) The undermining of an essential regulatory purpose of the program; (3) Obstruction of the fair administration of the program; or (4) A threat to the integrity of the program. The time limit for submission of an evidence of export report may be extended if such extension is determined by the GSM to be in the best interests of CCC. (c) Export sales reporting. § 1493.480 Certification requirements for the evidence of export. By providing the statement contained in § 1493.470(a)(10), the exporter is certifying that the information provided in the evidence of export report is true and correct and, further, that all requirements set forth in this section have been or will be met. The exporter will be required to provide further explanation or documentation with regard to reports that do not include this statement. If the exporter breaches or violates these certifications with respect to a SCGP payment guarantee, CCC will have the right, notwithstanding any other rights provided under this subpart, to annul guarantee coverage for any commodities not yet exported and/or to proceed against the exporter. The exporter, in submitting the evidence of export and providing the statement set forth in § 1493.470(a)(10), certifies that: (a) The agricultural commodity or product exported under the payment guarantee is a U.S. agricultural commodity as defined by § 1493.410(x). (b) Agricultural commodities of the grade, quality and quantity called for in the exporter's sales contract with the importer have been exported to the country specified in the payment guarantee; (c) There is an importer obligation as defined in § 1493.410(n) to cover the exported value of the commodity exported; (d) There have not been and will not be any corrupt payments or extra sales services or other items extraneous to the transaction provided, financed, or guaranteed in connection with the transaction, and that the transaction complies with applicable United States law; and (e) The information provided pursuant to § 1493.420 has not changed, the exporter still meets all of the qualification requirements of § 1493.420 and the exporter will immediately notify CCC if there is a change of circumstances which would cause it to fail to meet such requirements. [61 FR 33831, July 1, 1996, as amended at 62 FR 24561, May 6, 1997] § 1493.490 Proof of entry. (a) Diversion. (b) Records of proof of entry. (1) That the agricultural commodity entered the importing country; (2) The identification of the export carrier; (3) The quantity of the agricultural commodity; (4) The kind, type, grade and/or class of the agricultural commodity; and (5) The date(s) and place(s) of unloading of the agricultural commodity in the importing country. (Records of proof of entry need not be submitted with a claim for loss, except as may be provided in § 1493.500(b)(4)(ii).) § 1493.500 Notice of default and claims for loss. (a) Notice of default. (1) Payment guarantee number; (2) Name of the country; (3) Name of the defaulting importer; (4) Due date; (5) Total amount of the defaulted payment due, indicating separately the amounts for principal and interest; (6) Date of importer's refusal to pay, if applicable; and (7) Reason for importer's refusal to pay, if known. (b) Filing a claim for loss. (1) Payment guarantee number; (2) A certification that the scheduled payment has not been received; (3) A certification of the amount of accrued interest in default, the date interest began to accrue, and the interest rate on the importer obligation applicable to the claim; (4) A copy of each of the following documents, with a cover document containing a signed certification by the exporter or the exporter's assignee that each page of each document is a true and correct copy: (i) The importer obligation; (ii) Depending upon the method of shipment, the negotiable ocean carrier or intermodal bill(s) of lading signed by the shipping company with the onboard ocean carrier date for each shipment, the airway bill, or, if shipped by rail or truck, the entry certificate or similar document signed by an official of the importing country; (iii)(A) The exporter's invoice showing, as applicable, the FAS, FOB, CFR or CIF values; or (B) If there was an intervening purchaser, both the exporter's invoice to the intervening purchaser and the intervening purchaser's invoice to the importer; (iv) An instrument, in form and substance satisfactory to CCC, subrogating to CCC the respective rights of the exporter and the exporter's assignee, if applicable, to the amount of payment in default under the applicable export sale. The instrument must reference the applicable importer obligation; and (v) A copy of the report(s) of export previously submitted by the exporter to CCC pursuant to § 1493.470(a). (c) Subsequent claims for defaults on installments. § 1493.510 Payment for loss. (a) Determination of CCC's liability. (b) Amount of CCC's liability. (1) The guaranteed value as stated in the payment guarantee, plus eligible interest; or (2) The guaranteed percentage (as indicated in the payment guarantee) of the exported value indicated in the evidence of export, plus eligible interest. (c) Late interest payment. (d) Accelerated payments. (e) Action against the assignee. (1) The exporter complies with the reporting requirements under §§ 1493.470 and 1493.480, excluding post-export adjustments ( i.e. (2) The exporter or the exporter's assignee furnishes the statements and documents specified in § 1493.500. § 1493.520 Recovery of losses. (a) Notification. (b) Receipt of monies. (2) If CCC recovers monies that should be applied to a payment guarantee for which a claim has been paid by CCC, CCC will pay the holder of the payment guarantee its pro rata share immediately, provided that the required information necessary for determining pro rata distribution has been furnished. If payment is not made by CCC within 15 business days from the date of recovery or 15 business days from receiving the required information for determining pro rata distribution, whichever is later, CCC will pay interest calculated on the latest average investment rate of the most recent Treasury 91-day bill auction, as announced by the Department of Treasury, in effect on the date of recovery and such interest will accrue from such date to the date of payment by CCC. The interest will apply only to the portion of the recovery payable to the holder of the payment guarantee. (c) Allocation of recoveries. (d) Liabilities to CCC. (e) Good faith. (f) Cooperation in recoveries. Appendix A to § 1493.520—Illustration of Pro Rata Allocation of Recoveries The following example illustrates CCC's policy, as set forth in § 1493.520(c), regarding pro rata sharing of recoveries made for claims filed under the SCGP. A typical case might be as follows: 1. The U.S. exporter enters into a $200,000, 180 day credit arrangement with the importer calling for two equal payments of principal and two equal payments of interest at a rate of 10 percent per annum and a penalty interest rate of 12 percent per annum (basis 360 days) on overdue amounts until the overdue amount is paid. (Basis for interest calculation may be 360 or 365 days.) 2. The importer fails to make the final principal payment of $100,000 and an interest payment of $2,500.00 (10% per annum for 90 days on $100,000), both due on January 31. 3. On February 10, the U.S. exporter files a claim in good order with CCC. 4. CCC's guarantee states that CCC's maximum liability is limited to 60 percent of the principal amount due ($60,000) and interest at a rate of 8 percent per annum (basis 365 days) on 60 percent of the principal outstanding ($1,183.56) (8% per annum for 90 days on $60,000). (CCC's basis for interest calculation is 365 days.) 5. CCC pays the claim on February 22. 6. The average investment rate of the most recent 91-day Treasury Bill auction average which has been published by the Department of Treasury in effect on the date of nonpayment by CCC (January 31) is 7 percent. (CCC's late interest rate.) Computation of Obligations Using the above case, CCC's payment to the holder of the payment guarantee would be computed as follows: 1. CCC's Obligation under the Payment Guarantee: (a) Principal coverage—(60% $100,000) $60,000.00 (b) Interest coverage—(8% per annum for 90 days on $60,000, basis 365 days) 1,183.56 $61,183.56 (c) Late interest due from CCC (7% per annum for 11 days on $61,183.56, basis 365 days) 129.07 (d) Amount paid by CCC on February 22 $61,312.63 2. Importer's obligation under the importer obligation: (a) Principal due January 31 $100,000.00 Interest due January 31 (10% per annum for 90 days on $100,000, basis 360 days) 2,500.00 Amount owed by importer as of January 31 $102,500.00 (b) Penalty interest due (12% per annum for 22 days on $102,500.00, basis 360 days) 751.67 (c) Amount owed by importer as of February 22 $103,251.67 3. Amount of importer's obligation not covered by CCC's payment guarantee: $41,939.04 ($103,251.67-$61,312.63). Computation of Pro Rata Sharing in Recovery of Losses In establishing each party's respective interest in any recovery of losses, the total amount due under the importer obligation would be determined as of the date the claim is paid by CCC (February 22). Using the above example in which the amount owed by the importer is $103,251.67, CCC would be entitled to 59.38 percent ($61,312.63 divided by $103,251.67) and the holder of the payment guarantee would be entitled to 40.62 percent ($41,939.04 divided by $103,251.67) of any recoveries of losses after settlement of the claim. Since in this example, the losses were recovered after the claim has been paid by CCC, § 1493.520(b) would apply. § 1493.530 Miscellaneous provisions. (a) Assignment. (i) Made to one party acting for two or more parties; or (ii) Subject to further assignment. (2) An original and two copies of the written notice of assignment signed by the parties thereto must be filed by the assignee with the Treasurer, CCC, at the address specified in the Contacts P/R. (3) Receipt of the notice of assignment will ordinarily be acknowledged to the exporter and its assignee in writing by an officer of CCC. In cases where a financial institution is determined to be ineligible to receive an assignment, in accordance with paragraph (b) of this section, CCC will provide notice thereof, to the financial institution and to the exporter issued the payment guarantee, in lieu of an acknowledgment of assignment. (4) The name and address of the assignee must be included on the written notice of assignment. (b) Ineligibility of financial institutions to receive an assignment. (1) Is not in sound financial condition, as determined by the Treasurer of CCC; (2) Owns or controls the entity issuing the importer obligation; or (3) Is owned or controlled by an entity that owns or controls the entity issuing the importer obligation. (c) Ineligibility of financial institutions to receive proceeds. (1) At the time of assignment of a payment guarantee, is not in sound financial condition, as determined by the Treasurer of CCC; (2) Owns or controls the entity issuing the importer obligation; or (3) Is owned or controlled by an entity that owns or controls the entity issuing the importer obligation. (d) Alternative satisfaction of payment guarantees. (e) Maintenance of records and access to premises. (2) The exporter must maintain the proof of entry required by § 1493.490(b), and must provide access to such documentation if requested by the Secretary of Agriculture or his authorized representative for the five-year period specified in paragraph (e)(1) of this section. (f) Responsibility of program participants. (g) Submission of documents by principal officers. i.e. (h) Officials not to benefit. (i) OMB control number assigned pursuant to the Paperwork Reduction Act.

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