[Title 7 CFR ]
[Code of Federal Regulations (annual edition) - January 1, 2005 Edition]
[From the U.S. Government Printing Office]



[[Page i]]



          7


          Parts 1200 to 1599

                         Revised as of January 1, 2005


          Agriculture
          
          


________________________

          Containing a codification of documents of general 
          applicability and future effect

          As of January 1, 2005
          With Ancillaries
                    Published by:
                    Office of the Federal Register
                    National Archives and Records
                    Administration
                    A Special Edition of the Federal Register

[[Page ii]]

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                            Table of Contents



                                                                    Page
  Explanation.................................................       v

  Title 7:
    Subtitle B--Regulations of the Department of Agriculture 
      (Continued)
          Chapter XI--Agricultural Marketing Service 
          (Marketing Agreements and Orders; Miscellaneous 
          Commodities), Department of Agriculture                    5
          Chapter XIV--Commodity Credit Corporation, 
          Department of Agriculture                                307
          Chapter XV--Foreign Agricultural Service, Department 
          of Agriculture                                           871
  Finding Aids:
      Material Approved for Incorporation by Reference........     917
      Table of CFR Titles and Chapters........................     919
      Alphabetical List of Agencies Appearing in the CFR......     937
      List of CFR Sections Affected...........................     947

[[Page iv]]





                     ----------------------------

                     Cite this Code: CFR
                     To cite the regulations in 
                       this volume use title, 
                       part and section number. 
                       Thus, 7 CFR 1200.1 refers 
                       to title 7, part 1200, 
                       section 1.

                     ----------------------------

[[Page v]]



                               EXPLANATION

    The Code of Federal Regulations is a codification of the general and 
permanent rules published in the Federal Register by the Executive 
departments and agencies of the Federal Government. The Code is divided 
into 50 titles which represent broad areas subject to Federal 
regulation. Each title is divided into chapters which usually bear the 
name of the issuing agency. Each chapter is further subdivided into 
parts covering specific regulatory areas.
    Each volume of the Code is revised at least once each calendar year 
and issued on a quarterly basis approximately as follows:

Title 1 through Title 16.................................as of January 1
Title 17 through Title 27..................................as of April 1
Title 28 through Title 41...................................as of July 1
Title 42 through Title 50................................as of October 1

    The appropriate revision date is printed on the cover of each 
volume.

LEGAL STATUS

    The contents of the Federal Register are required to be judicially 
noticed (44 U.S.C. 1507). The Code of Federal Regulations is prima facie 
evidence of the text of the original documents (44 U.S.C. 1510).

HOW TO USE THE CODE OF FEDERAL REGULATIONS

    The Code of Federal Regulations is kept up to date by the individual 
issues of the Federal Register. These two publications must be used 
together to determine the latest version of any given rule.
    To determine whether a Code volume has been amended since its 
revision date (in this case, January 1, 2005), consult the ``List of CFR 
Sections Affected (LSA),'' which is issued monthly, and the ``Cumulative 
List of Parts Affected,'' which appears in the Reader Aids section of 
the daily Federal Register. These two lists will identify the Federal 
Register page number of the latest amendment of any given rule.

EFFECTIVE AND EXPIRATION DATES

    Each volume of the Code contains amendments published in the Federal 
Register since the last revision of that volume of the Code. Source 
citations for the regulations are referred to by volume number and page 
number of the Federal Register and date of publication. Publication 
dates and effective dates are usually not the same and care must be 
exercised by the user in determining the actual effective date. In 
instances where the effective date is beyond the cut-off date for the 
Code a note has been inserted to reflect the future effective date. In 
those instances where a regulation published in the Federal Register 
states a date certain for expiration, an appropriate note will be 
inserted following the text.

OMB CONTROL NUMBERS

    The Paperwork Reduction Act of 1980 (Pub. L. 96-511) requires 
Federal agencies to display an OMB control number with their information 
collection request.

[[Page vi]]

Many agencies have begun publishing numerous OMB control numbers as 
amendments to existing regulations in the CFR. These OMB numbers are 
placed as close as possible to the applicable recordkeeping or reporting 
requirements.

OBSOLETE PROVISIONS

    Provisions that become obsolete before the revision date stated on 
the cover of each volume are not carried. Code users may find the text 
of provisions in effect on a given date in the past by using the 
appropriate numerical list of sections affected. For the period before 
January 1, 2001, consult either the List of CFR Sections Affected, 1949-
1963, 1964-1972, 1973-1985, or 1986-2000, published in 11 separate 
volumes. For the period beginning January 1, 2001, a ``List of CFR 
Sections Affected'' is published at the end of each CFR volume.

INCORPORATION BY REFERENCE

    What is incorporation by reference? Incorporation by reference was 
established by statute and allows Federal agencies to meet the 
requirement to publish regulations in the Federal Register by referring 
to materials already published elsewhere. For an incorporation to be 
valid, the Director of the Federal Register must approve it. The legal 
effect of incorporation by reference is that the material is treated as 
if it were published in full in the Federal Register (5 U.S.C. 552(a)). 
This material, like any other properly issued regulation, has the force 
of law.
    What is a proper incorporation by reference? The Director of the 
Federal Register will approve an incorporation by reference only when 
the requirements of 1 CFR part 51 are met. Some of the elements on which 
approval is based are:
    (a) The incorporation will substantially reduce the volume of 
material published in the Federal Register.
    (b) The matter incorporated is in fact available to the extent 
necessary to afford fairness and uniformity in the administrative 
process.
    (c) The incorporating document is drafted and submitted for 
publication in accordance with 1 CFR part 51.
    Properly approved incorporations by reference in this volume are 
listed in the Finding Aids at the end of this volume.
    What if the material incorporated by reference cannot be found? If 
you have any problem locating or obtaining a copy of material listed in 
the Finding Aids of this volume as an approved incorporation by 
reference, please contact the agency that issued the regulation 
containing that incorporation. If, after contacting the agency, you find 
the material is not available, please notify the Director of the Federal 
Register, National Archives and Records Administration, Washington DC 
20408, or call 202-741-6010.

CFR INDEXES AND TABULAR GUIDES

    A subject index to the Code of Federal Regulations is contained in a 
separate volume, revised annually as of January 1, entitled CFR Index 
and Finding Aids. This volume contains the Parallel Table of Statutory 
Authorities and Agency Rules (Table I). A list of CFR titles, chapters, 
and parts and an alphabetical list of agencies publishing in the CFR are 
also included in this volume.
    An index to the text of ``Title 3--The President'' is carried within 
that volume.
    The Federal Register Index is issued monthly in cumulative form. 
This index is based on a consolidation of the ``Contents'' entries in 
the daily Federal Register.
    A List of CFR Sections Affected (LSA) is published monthly, keyed to 
the revision dates of the 50 CFR titles.

[[Page vii]]


REPUBLICATION OF MATERIAL

    There are no restrictions on the republication of textual material 
appearing in the Code of Federal Regulations.

INQUIRIES

    For a legal interpretation or explanation of any regulation in this 
volume, contact the issuing agency. The issuing agency's name appears at 
the top of odd-numbered pages.
    For inquiries concerning CFR reference assistance, call 202-741-6000 
or write to the Director, Office of the Federal Register, National 
Archives and Records Administration, Washington, DC 20408 or e-mail 
fedreg.info@nara.gov.

SALES

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ELECTRONIC SERVICES

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CFR Sections Affected), The United States Government Manual, the Federal 
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mail, gpoaccess@gpo.gov.
    The Office of the Federal Register also offers a free service on the 
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site for public law numbers, Federal Register finding aids, and related 
information. Connect to NARA's web site at www.archives.gov/federal--
register. The NARA site also contains links to GPO Access.

                              Raymond A. Mosley,
                                    Director,
                          Office of the Federal Register.

January 1, 2005.

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                               THIS TITLE

    Title 7--Agriculture is composed of fifteen volumes. The parts in 
these volumes are arranged in the following order: parts 1-26, 27-52, 
53-209, 210-299, 300-399, 400-699, 700-899, 900-999, 1000-1199, 1200-
1599, 1600-1899, 1900-1939, 1940-1949, 1950-1999, and part 2000 to end. 
The contents of these volumes represent all current regulations codified 
under this title of the CFR as of January 1, 2005.

    The Food and Nutrition Service current regulations in the volume 
containing parts 210-299, include the Child Nutrition Programs and the 
Food Stamp Program. The regulations of the Federal Crop Insurance 
Corporation are found in the volume containing parts 400-699.

    All marketing agreements and orders for fruits, vegetables and nuts 
appear in the one volume containing parts 900-999. All marketing 
agreements and orders for milk appear in the volume containing parts 
1000-1199. Part 900--General Regulations is carried as a note in the 
volume containing parts 1000-1199, as a convenience to the user.

    For this volume, Elmer Barksdale was Chief Editor. The Code of 
Federal Regualtions publication is under the direction of Frances D. 
McDonald, assisted by Alomha S. Morris.

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                          TITLE 7--AGRICULTURE




                 (This book contains parts 1200 to 1599)

  --------------------------------------------------------------------

  SUBTITLE B--Regulations of the Department of Agriculture (Continued)

                                                                    Part

chapter xi--Agricultural Marketing Service (Marketing 
  Agreements and Orders; Miscellaneous Commodities), 
  Department of Agriculture.................................        1200

chapter xiv--Commodity Credit Corporation, Department of 
  Agriculture...............................................        1400

chapter xv--Foreign Agricultural Service, Department of 
  Agriculture...............................................        1520

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  Subtitle B--Regulations of the Department of Agriculture (Continued)

[[Page 5]]



  CHAPTER XI--AGRICULTURAL MARKETING SERVICE (MARKETING AGREEMENTS AND 
      ORDERS; MISCELLANEOUS COMMODITIES), DEPARTMENT OF AGRICULTURE




  --------------------------------------------------------------------
Part                                                                Page
1200            Rules of practice and procedure governing 
                    proceedings under research, promotion, 
                    and information programs................           7
1205            Cotton research and promotion...............          16
1206            Mango promotion, research, and information..          46
1207            Potato research and promotion plan..........          59
1209            Mushroom promotion, research, and consumer 
                    information order.......................          73
1210            Watermelon research and promotion plan......          93
1214            Kiwifruit research, promotion, and consumer 
                    information order.......................         116
1215            Popcorn promotion, research, and consumer 
                    information.............................         118
1216            Peanut promotion, research, and information 
                    order...................................         129
1218            Blueberry promotion, research, and 
                    information order.......................         143
1219            Hass avocado promotion, research, and 
                    information.............................         157
1220            Soybean promotion, research, and consumer 
                    information.............................         175
1230            Pork promotion, research, and consumer 
                    information.............................         200
1240            Honey research, promotion, and consumer 
                    information order.......................         225
1250            Egg research and promotion..................         246
1260            Beef promotion and research.................         262
1270            Wool and mohair advertising and promotion [Reserved]
1280            Lamb promotion, research, and information 
                    order...................................         284

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PART 1200_RULES OF PRACTICE AND PROCEDURE GOVERNING PROCEEDINGS UNDER 
RESEARCH, PROMOTION, AND INFORMATION PROGRAMS--Table of Contents




   Subpart A_Rules of Practice and Procedure Governing Proceedings to 
                      Formulate and Amend an Order

Sec.
1200.1 Words in the singular form.
1200.2 Definitions.
1200.3 Proposals.
1200.4 Reimbursement of Secretary's expenses.
1200.5 Institution of proceedings.
1200.6 Docket number.
1200.7 Judge.
1200.8 Motions and requests.
1200.9 Conduct of the hearing.
1200.10 Oral and written arguments.
1200.11 Certification of the transcript.
1200.12 Copies of the transcript.
1200.13 Administrator's recommended decision.
1200.14 Submission to Secretary.
1200.15 Decision by the Secretary.
1200.16 Execution of the order.
1200.17 Filing, extension of time, effective date of filing, and 
          computation of time.
1200.18 Ex parte communications.
1200.19 Additional documents to be filed with hearing clerk.
1200.20 Hearing before Secretary.

Subpart B_Rules of Practice Governing Proceedings on Petitions to Modify 
  or to be Exempted from Research, Promotion, and Information Programs

1200.50 Words in the singular form.
1200.51 Definitions.
1200.52 Institution of proceeding.

    Authority: 7 U.S.C. 2111, 2620, 2713, 4509, 4609, 4814, 4909, 6106, 
6306, 6410, 7418, and 7486.



   Subpart A_Rules of Practice and Procedure Governing Proceedings to 
                      Formulate and Amend an Order

    Authority: 7 U.S.C. 2103, 2614, 2704, and 4804.

    Source: 47 FR 44684, Oct. 8, 1982, unless otherwise noted.



Sec. 1200.1  Words in the singular form.

    Words in this subpart in the singular form shall be deemed to import 
the plural, and vice versa, as the case may demand.



Sec. 1200.2  Definitions.

    (a) The term Act means the Cotton Research and Promotion Act, as 
amended [7 U.S.C. 2101-2119]; the Egg Research and Consumer Information 
Act, as amended [7 U.S.C. 2701-2718]; the Pork Promotion, Research, and 
Consumer Information Act [7 U.S.C. 4801-4819]; and the Potato Research 
and Promotion Act, as amended [7 U.S.C. 2611-2627].
    (b) Administrator means the Administrator of the Agricultural 
Marketing Service or any officer or employee of the Department to whom 
authority has been delegated or may hereafter be delegated to act for 
the Administrator.
    (b) Board means the board or council established by the order to 
administer the program.
    (c) Department means the U.S. Department of Agriculture.
    (d) Federal Register means the publication provided for by the 
Federal Register Act, approved July 26, 1935 [44 U.S.C. 1501-1511], and 
acts supplementing and amending it.
    (e) Hearing means that part of the proceeding which involves the 
submission of evidence.
    (f) Judge means any administrative law judge appointed pursuant to 5 
U.S.C. 3105 and assigned to conduct the hearing.
    (g) Hearing means that part of the proceeding that involves the 
submission of evidence.
    (h) Hearing clerk means the Hearing Clerk, U.S. Department of 
Agriculture, Washington, D.C.
    (i) Order means any order or any amendment thereto which may be 
issued pursuant to the Act. The term order shall include plans issued 
under the Acts listed in paragraph (a) of this section.
    (j) Proceeding means a proceeding before the Secretary arising under 
the pertinent section of an Act.
    (k) Secretary means the Secretary of Agriculture of the United 
States, or any officer or employee of the Department to whom authority 
has heretofore been delegated, or to whom authority may hereafter be 
delegated, to act for the Secretary.

[67 FR 44350, July 2, 2002]

[[Page 8]]



Sec. 1200.3  Proposals.

    (a) An order may be proposed by any organization certified pursuant 
to the Act or any interested person affected by the Act, including the 
Secretary. Any person or organization other than the Secretary proposing 
an order shall file with the Administrator a written application, 
together with a copy of the proposal, requesting the Secretary to hold a 
hearing upon the proposal. Upon receipt of such proposal, the 
Administrator shall cause such investigation to be made and such 
consideration to be given as, in the Administrator's opinion, are 
warranted. If the investigation and consideration lead the Administrator 
to conclude that the proposed order will not tend to effectuate the 
declared policy of the Act, or that for other proper reasons a hearing 
should not be held on the proposal, the Administrator shall deny the 
application, and promptly notify the applicant of such denial, which 
notice shall be accompanied by a brief statement of the grounds for the 
denial.
    (b) If the investigation and consideration lead the Administrator to 
conclude that the proposed order will tend to effectuate the declared 
policy of the Act, or if the Secretary desires to propose an order, the 
Administrator shall sign and cause to be served a notice of hearing, as 
provided herein.



Sec. 1200.4  Reimbursement of Secretary's expenses.

    If provided for in the Act or any amendment thereto, expenses 
incurred by the Secretary in preparing or amending the order, 
administering the order, and conducting the referendum shall be 
reimbursed.



Sec. 1200.5  Institution of proceedings.

    (a) Filing and contents of the notice of hearing. The proceeding 
shall be instituted by filing the notice of hearing with the hearing 
clerk. The notice of hearing shall contain a reference to the authority 
under which the order is proposed; shall define the scope of the hearing 
as specifically as may be practicable; shall contain either the terms or 
substance of the proposed order or a description of the subjects and 
issues involved; and shall state the time and place of such hearing, and 
the place where copies of such proposed order may be obtained or 
examined. The time of the hearing shall not be less than 15 days after 
the date of publication of the notice in the Federal Register, as 
provided herein, unless the Administrator shall determine that an 
emergency exists which requires a shorter period of notice, in which 
case the period of notice shall be that which the Administrator may 
determine to be reasonable in the circumstances: Except that in the case 
of hearings on amendments to an order, the time of the hearing may be 
less than 15 days but shall not be less than three days after the date 
of publication in the Federal Register.
    (b) Giving notice of hearing and supplemental publicity. (1) The 
Administrator shall give or cause to be given notice of hearing in the 
following manner:
    (i) By publication of the notice of hearing in the Federal Register;
    (ii) By mailing a copy of the notice of hearing to each organization 
known by the Administrator to be interested therein;
    (iii) By issuing a press release containing the complete text or a 
summary of the contents of the notice of hearing and making the same 
available to such newspapers as, in the Administrator's discretion, are 
best calculated to bring the notice to the attention of the persons 
interested therein; and
    (iv) By forwarding copies of the notice of hearing addressed to 
those Governors of the States and executive heads of territories and 
possessions of the United States and the mayor of the District of 
Columbia that are directly affected by such order.
    (2) Legal notice of the hearing shall be deemed to be given if 
notice is given in the manner provided by paragraph (b)(1)(i) of this 
section; failure to give notice in the manner provided in paragraphs 
(b)(2) (ii), (iii), and (iv) of this section shall not affect the 
legality of the notice.
    (c) Record of notice and supplemental publicity. There shall be 
filed with the hearing clerk or submitted to the judge at the hearing an 
affidavit or certificate of the person giving the notice provided in 
paragraphs (b)(1) (iii) and (iv) of this section. In regard to the

[[Page 9]]

provisions relating to mailing in paragraph (b)(1)(ii) of this section, 
determination by the Administrator that such provisions have been 
complied with shall be filed with the hearing clerk or submitted to the 
judge at the hearing. In the alternative, if notice is not given in the 
manner provided in paragraphs (b)(1) (ii), (iii), and (iv) of this 
section there shall be filed with the hearing clerk or submitted to the 
judge at the hearing a determination by the Administrator that such 
notice is impracticable, unnecessary, or contrary to the public interest 
with a brief statement of the reasons for such determination. 
Determinations by the Administrator as herein provided shall be final.



Sec. 1200.6  Docket number.

    Each proceeding, immediately following its institution, shall be 
assigned a docket number by the hearing clerk and thereafter the 
proceeding may be referred to by such number.



Sec. 1200.7  Judge.

    (a) Assignment. No judge who has any pecuniary interest in the 
outcome of a proceeding shall serve as judge in such proceeding.
    (b) Power of judge. Subject to review by the Secretary, as provided 
elsewhere in this subpart, the judge in any proceeding shall have power 
to:
    (1) Rule upon motions and requests;
    (2) Change the time and place of hearings, and adjourn the hearing 
from time to time or from place to place;
    (3) Administer oaths and affirmations and take affidavits;
    (4) Examine and cross-examine witnesses and receive evidence;
    (5) Admit or exclude evidence;
    (6) Hear oral argument on facts or law; and
    (7) Do all acts and take all measures necessary for the maintenance 
of order at the hearings and the efficient conduct of the proceeding.
    (c) Who may act in absence of judge. In case of the absence of the 
judge or the judge's inability to act, the powers and duties to be 
performed by the judge under this part in connection with a proceeding 
may, without abatement of the proceeding unless otherwise ordered by the 
Secretary, be assigned to any other judge.
    (d) Disqualification of judge. The judge may at any time withdraw as 
judge in a proceeding if such judge deems himself or herself to be 
disqualified. Upon the filing by an interested person in good faith of a 
timely and sufficient affidavit of personal bias or disqualification of 
a judge, the Secretary shall determine the matter as a part of the 
record and decision in the proceeding, after making such investigation 
or holding such hearings, or both, as the Secretary may deem appropriate 
in the circumstances.



Sec. 1200.8  Motions and requests.

    (a) General. (1) All motions and requests shall be filed with the 
hearing clerk, except that those made during the course of the hearing 
may be filed with the judge or may be stated orally and made a part of 
the transcript.
    (2) Except as provided in Sec. 1200.17(b) such motions and requests 
shall be addressed to, and ruled on by, the judge if made prior to 
certification of the transcript pursuant to Sec. 1200.11 or by the 
Secretary if made thereafter.
    (b) Certification to Secretary. The judge may, in his or her 
discretion, submit or certify to the Secretary for decision any motion, 
request, objection, or other question addressed to the judge.



Sec. 1200.9  Conduct of the hearing.

    (a) Time and place. The hearing shall be held at the time and place 
fixed in the notice of hearing, unless the judge shall have changed the 
time or place, in which event the judge shall file with the hearing 
clerk a notice of such change, which notice shall be given in the same 
manner as provided in Sec. 1200.5 (relating to the giving of notice of 
the hearing): Except that if the change in time or place of hearing is 
made less than five days prior to the date previously fixed for the 
hearing, the judge either in addition to or in lieu of causing the 
notice of the change to be given, shall announce, or cause to be 
announced, the change at the time and place previously fixed for the 
hearing.
    (b) Appearances--(1) Right to appear. At the hearing, any interested 
person

[[Page 10]]

shall be given an opportunity to appear, either in person or through 
authorized counsel or representative, and to be heard with respect to 
matters relevant and material to the proceeding. Any interested person 
who desires to be heard in person at any hearing under these rules 
shall, before proceeding to testify, state his or her name, address, and 
occupation. If any such person is appearing through a counsel or 
representative, such person or such counsel or representative shall, 
before proceeding to testify or otherwise to participate in the hearing, 
state for the record the authority to act as such counsel or 
representative, and the names, addresses, and occupations of such person 
and such counsel or representative. Any such person or such counsel or 
representative shall give such other information respecting such 
appearance as the judge may request.
    (2) Debarment of counsel or representative. (i) Whenever, while a 
proceeding is pending before the judge, such judge finds that a person, 
acting as counsel or representative for any person participating in the 
proceeding, is guilty of unethical or unprofessional conduct, the judge 
may order that such person be precluded from further acting as counsel 
or representative in such proceeding. An appeal to the Secretary may be 
taken from any such order, but the proceeding shall not be delayed or 
suspended pending disposition of the appeal: Except that the judge may 
suspend the proceeding for a reasonable time for the purpose of enabling 
the client to obtain other counsel or representative.
    (ii) In case the judge has ordered that a person be precluded from 
further action as counsel or representative in the proceeding, the judge 
within a reasonable time thereafter shall submit to the Secretary a 
report of the facts and circumstances surrounding such order and shall 
recommend what action the Secretary should take respecting the 
appearance of such person as counsel or representative in other 
proceedings before the Secretary. Thereafter the Secretary may, after 
notice and an opportunity for hearing, issue such order respecting the 
appearance of such person as counsel or representative in proceedings 
before the Secretary as the Secretary finds to be appropriate.
    (3) Failure to appear. If any interested person fails to appear at 
the hearing, that person shall be deemed to have waived the right to be 
heard in the proceeding.
    (c) Order of procedure. (1) The judge shall, at the opening of the 
hearing prior to the taking of testimony, have noted as part of the 
record the notice of hearing as filed with the Office of the Federal 
Register and the affidavit or certificate of the giving of notice or the 
determination provided for in Sec. 1200.5(c).
    (2) Evidence shall then be received with respect to the matters 
specified in the notice of the hearing in such order as the judge shall 
announce.
    (d) Evidence--(1) General. The hearing shall be publicly conducted, 
and the testimony given at the hearing shall be reported verbatim.
    (i) Every witness shall, before proceeding to testify, be sworn or 
make affirmation. Cross-examination shall be permitted to the extent 
required for a full and true disclosure of the facts.
    (ii) When necessary, in order to prevent undue prolongation of the 
hearing, the judge may limit the number of times any witness may testify 
to the same matter or the amount of corroborative or cumulative 
evidence.
    (iii) The judge shall, insofar as practicable, exclude evidence 
which is immaterial, irrelevant, or unduly repetitious, or which is not 
of the sort upon which responsible persons are accustomed to rely.
    (2) Objections. If a party objects to the admission or rejection of 
any evidence or to any other ruling of the judge during the hearing, 
such party shall state briefly the grounds of such objection, whereupon 
an automatic exception will follow if the objection is overruled by the 
judge. The transcript shall not include argument or debate thereon 
except as ordered by the judge. The ruling of the judge on any objection 
shall be a part of the transcript. Only objections made before the judge 
may subsequently be relied upon in the proceeding.
    (3) Proof and authentication of official records or documents. An 
official record or document, when admissible for any

[[Page 11]]

purpose, shall be admissible as evidence without the presence of the 
person who made or prepared the same. The judge shall exercise 
discretion in determining whether an official publication of such record 
or document shall be necessary, or whether a copy would be permissible. 
If permissible such a copy should be attested to by the person having 
legal custody of it, and accompanied by a certificate that such person 
has the custody.
    (4) Exhibits. All written statements, charts, tabulations, or 
similar data offered in evidence at the hearing shall, after 
identification by the proponent and upon satisfactory showing of 
authenticity, relevancy, and materiality, be numbered as exhibits and 
received in evidence and made a part of the record. Such exhibits shall 
be submitted in quadruplicate and in documentary form. In case the 
required number of copies is not made available, the judge shall 
exercise discretion as to whether said exhibits shall, when practicable, 
be read in evidence or whether additional copies shall be required to be 
submitted within a time to be specified by the judge. If the testimony 
of a witness refers to a statute, or to a report or document (including 
the record of any previous hearing), the judge, after inquiry relating 
to the identification of such statute, report, or document, shall 
determine whether the same shall be produced at the hearing and 
physically be made a part of the evidence as an exhibit, or whether it 
shall be incorporated into the evidence by reference. If relevant and 
material matter offered in evidence is embraced in a report or document 
(including the record of any previous hearing) containing immaterial or 
irrelevant matter, such immaterial or irrelevant matter shall be 
excluded and shall be segregated insofar as practicable, subject to the 
direction of the judge.
    (5) Official notice. Official notice at the hearing may be taken of 
such matters as are judicially noticed by the courts of the United 
States and of any other matter of technical, scientific, or commercial 
fact of established character: Except that interested persons shall be 
given an adequate period of time, at the hearing or subsequent to it, of 
matters so noticed and shall be given adequate opportunity to show that 
such facts are inaccurate or are erroneously noticed.
    (6) Offer of proof. Whenever evidence is excluded from the record, 
the party offering such evidence may make an offer of proof, which shall 
be included in the transcript. The offer of proof shall consist of a 
brief statement describing the evidence to be offered. If the evidence 
consists of a brief oral statement or of an exhibit, it shall be 
inserted into the transcript in toto. In such event, it shall be 
considered a part of the transcript if the Secretary decides that the 
judge's ruling in excluding the evidence was erroneous. The judge shall 
not allow the insertion of such evidence in toto if the taking of such 
evidence will consume a considerable length of time at the hearing. In 
the latter event, if the Secretary decides that the judge erred in 
excluding the evidence, and that such error was substantial, the hearing 
shall be reopened to permit the taking of such evidence.



Sec. 1200.10  Oral and written arguments.

    (a) Oral argument before the judge. Oral argument before the judge 
shall be in the discretion of the judge. Such argument, when permitted, 
may be limited by the judge to any extent that the judge finds necessary 
for the expeditious disposition of the proceeding and shall be reduced 
to writing and made part of the transcript.
    (b) Briefs, proposed findings, and conclusions. The judge shall 
announce at the hearing a reasonable period of time within which 
interested persons may file with the hearing clerk proposed findings and 
conclusions, and written arguments or briefs, based upon the evidence 
received at the hearing, citing, where practicable, the page or pages of 
the transcript of the testimony where such evidence appears. Factual 
material other than that adduced at the hearing or subject to official 
notice shall not be alluded to therein, and, in any case, shall not be 
considered in the formulation of the order. If the person filing a brief 
desires the Secretary to consider any objection made by such person to a 
ruling of the judge, as provided in Sec. 1200.9(d), that person shall 
include in the brief a

[[Page 12]]

concise statement concerning each such objection, referring, where 
practicable, to the pertinent pages of the transcript.



Sec. 1200.11  Certification of the transcript.

    The judge shall notify the hearing clerk of the close of a hearing 
as soon as possible thereafter and of the time for filing written 
arguments, briefs, proposed findings, and proposed conclusions and shall 
furnish the hearing clerk with such other information as may be 
necessary. As soon as possible after the hearing, the judge shall 
transmit to the hearing clerk an original and three copies of the 
transcript of the testimony and the original and all copies of the 
exhibits not already on file in the office of the hearing clerk. The 
judge shall attach to the original transcript of the testimony a 
certificate stating that, to the best of the judge's knowledge and 
belief, the transcript is a true transcript of the testimony given at 
the hearing, except in such particulars as the judge shall specify, and 
that the exhibits transmitted are all the exhibits as introduced at the 
hearing with such exceptions as the judge shall specify. A copy of such 
certificate shall be attached to each of the copies of the transcript of 
testimony. In accordance with such certificate the hearing clerk shall 
note upon the official record copy, and cause to be noted on other 
copies of the transcript, each correction detailed therein by adding or 
crossing out (but without obscuring the text as originally transcribed) 
at the appropriate place any words necessary to make the same conform to 
the correct meaning, as certified by the judge. The hearing clerk shall 
obtain and file certifications to the effect that such corrections have 
been effectuated in copies other than the official record copy.



Sec. 1200.12  Copies of the transcript.

    (a) During the period in which the proceeding has an active status 
in the Department, a copy of the transcript and exhibits shall be kept 
on file in the office of the hearing clerk where it shall be available 
for examination during official hours of business. Thereafter said 
transcript and exhibits shall be made available by the hearing clerk for 
examination during official hours of business after prior request and 
reasonable notice to the hearing clerk.
    (b) Transcripts of hearings shall be made available to any person at 
actual cost of duplication.

[47 FR 44684, Oct. 8, 1982, as amended at 67 FR 10830, Mar. 11, 2002]



Sec. 1200.13  Administrator's recommended decision.

    (a) Preparation. As soon as practicable following the termination of 
the period allowed for the filing of written arguments or briefs and 
proposed findings and conclusions the Administrator shall file with the 
hearing clerk a recommended decision.
    (b) Contents. The Administrator's recommended decision shall 
include: (1) a preliminary statement containing a description of the 
history of the proceedings, a brief explanation of the material issues 
of fact, law, or discretion presented on the record, and proposed 
findings and conclusions about such issues, including the reasons or 
basis for such proposed findings; (2) a ruling upon each proposed 
finding or conclusion submitted by interested persons; and (3) an 
appropriate proposed order effectuating the Administrator's 
recommendations.
    (c) Exceptions to recommended decision. Immediately following the 
filing of the recommended decision, the Administrator shall give notice 
thereof and opportunity to file exceptions thereto by publication in the 
Federal Register. Within a period of time specified in such notice any 
interested person may file with the hearing clerk exceptions to the 
Administrator's proposed order and a brief in support of such 
exceptions. Such exceptions shall be in writing, shall refer, where 
practicable, to the related pages of the transcript, and may suggest 
appropriate changes in the proposed order.
    (d) Omission of recommended decision. The procedure provided in this 
section may be omitted only if the Secretary finds on the basis of the 
record that due and timely execution of the Secretary's functions 
imperatively and unavoidably requires such omission.

[[Page 13]]



Sec. 1200.14  Submission to Secretary.

    Upon the expiration of the period allowed for filing exceptions or 
upon request of the Secretary, the hearing clerk shall transmit to the 
Secretary the record of the proceeding. Such record shall include: All 
motions and requests filed with the hearing clerk and rulings thereon; 
the certified transcript; any proposed findings or conclusions or 
written arguments or briefs that may have been filed; the 
Administrator's recommended decision, if any; and such exceptions as may 
have been filed.



Sec. 1200.15  Decision by the Secretary.

    After due consideration of the record, the Secretary shall render a 
decision. Such decision shall become a part of the record and shall 
include: (a) a statement of findings and conclusions, including the 
reasons or basis for such findings, upon all the material issues of 
fact, law, or discretion presented on the record, (b) a ruling upon each 
proposed finding and proposed conclusion not previously ruled upon in 
the record, (c) a ruling upon each exception filed by interested 
persons, and (d) either (1) denial of the proposal to issue an order, or 
(2) if the findings upon the record so warrant, an order, the provisions 
of which shall be set forth and such order shall be complete except for 
its effective date and any determinations to be made under Sec. 
1200.16: Except that such order shall not be executed, issued, or made 
effective until and unless the Secretary determines that the 
requirements of Sec. 1200.16 have been met.



Sec. 1200.16  Execution of the order.

    (a) Issuance of the order. The Secretary shall, if the Secretary 
finds that it will tend to effectuate the purposes of the Act, issue and 
make effective the order which was filed as part of the Secretary's 
decision pursuant to Sec. 1200.15: Except that the issuance of such 
order shall have been approved or favored by eligible voters as required 
by the applicable Act.
    (b) Effective date of order. No order shall become effective in less 
than 30 days after its publication in the Federal Register, unless the 
Secretary, upon good cause found and published with the order, fixes an 
earlier effective date.
    (c) Notice of issuance. After issuance of the order, such order 
shall be filed with the hearing clerk, and notice thereof, together with 
notice of the effective date, shall be given by publication in the 
Federal Register.



Sec. 1200.17  Filing, extension of time, effective date of filing, 
and computation of time.

    (a) Number of copies. Except as provided otherwise herein, all 
documents or papers required or authorized by the foregoing provisions 
hereof to be filed with the hearing clerk shall be filed in 
quadruplicate. Any documents or papers so required or authorized to be 
filed with the hearing clerk shall be filed with the judge during the 
course of an oral hearing.
    (b) Extension of time. The time for filing of any document or paper 
required or authorized by the foregoing provisions to be filed may be 
extended by the judge (before the record is so certified by the judge) 
or by the Administrator (after the record is so certified by the judge 
but before it is transmitted to the secretary), or by the Secretary 
(after the record is transmitted to the secretary) upon request filed, 
and if, in the judgment of the judge, Administrator, or the Secretary, 
as the case may be, there is good reason for the extension. All rulings 
made pursuant to this paragraph shall be filed with the hearing clerk.
    (c) Effective date of filing. Any document or paper required or 
authorized in this subpart to be filed shall be deemed to be filed at 
the time it is received by the Hearing Clerk.
    (d) Computation of time. Each day, including Saturdays, Sundays, and 
legal public holidays, shall be included in computing the time allowed 
for filing any document or paper: Provided, That when the time for 
filing a document or paper expires on a Saturday, Sunday, or legal 
public holiday, the time allowed for filing the document or paper shall 
be extended to include the following business day.

[47 FR 44684, Oct. 8, 1982, as amended at 67 FR 10830, Mar. 11, 2002]

[[Page 14]]



Sec. 1200.18  Ex parte communications.

    (a) At no stage of the proceeding following the issuance of a notice 
of hearing and prior to the issuance of the Secretary's decision thereon 
shall an employee of the Department who is or may reasonably be expected 
to be involved in the decision process of the proceeding discuss ex 
parte the merits of the proceeding with any person having an interest in 
the proceeding or with any representative of such person: Except that 
procedural matters and status reports shall not be included within the 
limitation: And except further that an employee of the Department who is 
or may reasonably be expected to be involved in the decisional process 
of the proceeding may discuss the merits of the proceeding with such a 
person if all parties known to be interested in the proceeding have been 
given notice and an opportunity to participate. A memorandum of any such 
discussion shall be included in the record of the proceeding.
    (b) No person interested in the proceeding shall make or knowingly 
cause to be made to an employee of the Department who is or may 
reasonably be expected to be involved in the decisional process of the 
proceeding an ex parte communication relevant to the merits of the 
proceeding except as provided in paragraph (a) of this section.
    (c) If an employee of the Department who is or may reasonably be 
expected to be involved in the decisional process of the proceeding 
receives or makes a communication prohibited by this section, the 
Department shall place on the public record of the proceeding:
    (1) All such written communications;
    (2) Memoranda stating the substance of all such oral communications; 
and
    (3) All written responses, and memoranda, stating the substance of 
all oral responses thereto.
    (d) Upon receipt of a communication knowingly made or knowingly 
caused to be made by a party in violation of this section, the 
Department may, to the extent consistent with the interest of justice 
and the policy of the underlying statute, take whatever steps are deemed 
necessary to nullify the effect of such communication.
    (e) For the purposes of this section, ex parte communication means 
any oral or written communication not on the public record with respect 
to which reasonable prior notice to all interested parties is not given, 
but which shall not include requests for status reports (including 
requests on procedural matters) on a proceeding.



Sec. 1200.19  Additional documents to be filed with hearing clerk.

    In addition to the documents or papers required or authorized by the 
foregoing provisions of this subpart to be filed with the hearing clerk, 
the hearing clerk shall receive for filing and shall have custody of all 
papers, reports, records, orders, and other documents which relate to 
the administration of any order and which the Secretary is required to 
issue or to approve.



Sec. 1200.20  Hearing before Secretary.

    The Secretary may act in the place and stead of a judge in any 
proceeding herein. When the Secretary so acts, the hearing clerk shall 
transmit the record to the Secretary at the expiration of the period 
provided for the filing of proposed findings of fact, conclusions, and 
orders, and the Secretary shall then, after due consideration of the 
record, issue the final decision in the proceeding: Except the Secretary 
may issue a tentative decision in which event the parties shall be 
afforded an opportunity to file exceptions before the issuance of the 
final decision.



Subpart B_Rules of Practice Governing Proceedings on Petitions to Modify 
   or to be Exempted from Research, Promotion and Information Programs

    Authority: 7 U.S.C. 2111, 2620, 2713, 4509, 4609, 4814, 4909, 6008, 
6106, 6306, 6410, 6807, 7106, 7418, 7486, and 7806.

    Source: 60 FR 37326, July 20, 1995, unless otherwise noted.



Sec. 1200.50  Words in the singular form.

    Words in this subpart in the singular form shall be deemed to import 
the

[[Page 15]]

plural, and vice versa, as the case may demand.



Sec. 1200.51  Definitions.

    As used in this subpart, the terms as defined in the Act shall apply 
with equal force and effect. In addition, unless the context otherwise 
requires:
    (a) The term Act means the Commodity Research, Promotion, and 
Information Act of 1996 [7 U.S.C. 7401-7425]; the Cotton Research and 
Promotion Act, as amended [7 U.S.C. 2101-2119]; the Dairy Production 
Stabilization Act of 1983 [7 U.S.C. 4501-4513]; the Egg Research and 
Consumer Information Act, as amended [7 U.S.C. 2701-2718]; the Fluid 
Milk Promotion Act of 1990 [7 U.S.C. 6401-6417]; the Hass Avocado 
Promotion, Research, and Information Act of 2000 [7 U.S.C. 7801-7813]; 
the Honey Research, Promotion, and Consumer Information Act, as amended 
[7 U.S.C. 4601-4612]; the Mushroom Promotion, Research, and Consumer 
Information Act of 1990 [7 U.S.C. 6101-6112]; the Pecan Promotion and 
Research Act of 1990 [7 U.S.C. 6001-6013]; the Popcorn Promotion, 
Research, and Consumer Information Act [7 U.S.C. 7481-7491]; the Pork 
Promotion, Research, and Consumer Information Act [7 U.S.C. 4801-4819]; 
the Potato Research and Promotion Act, as amended [7 U.S.C. 2611-2627]; 
the Sheep Promotion, Research, and Information Act of 1994 [7 U.S.C. 
7101-7111]; the Soybean Promotion, Research, and Consumer Information 
Act [7 U.S.C. 6301-6311]; and the Watermelon Research and Promotion Act, 
as amended, [7 U.S.C. 4901-4916].
    (b) Administrator means the Administrator of the Agricultural 
Marketing Service or any officer or employee of the Department to whom 
authority has been delegated or may hereafter be delegated to act for 
the Administrator.
    (c) Decision means the judge's initial decision and includes the 
judge's:
    (1) Findings of fact and conclusions with respect to all material 
issues of fact, law or discretion, as well as the reasons or basis 
thereof;
    (2) Order; and
    (3) Rulings on findings, conclusions and orders submitted by the 
parties.
    (d) Department means the U.S. Department of Agriculture.
    (e) Hearing means that part of the proceedings which involves the 
submission of evidence.
    (f) Hearing clerk means the Hearing Clerk, U.S. Department of 
Agriculture, Washington, D.C.
    (g) Judge means any administrative law judge, appointed pursuant to 
5 U.S.C. 3105, and assigned to the proceeding involved.
    (h) Order means any order or any amendment thereto which may be 
issued pursuant to the Act. The term order shall include plans issued 
under the Acts listed in paragraph (a) of this section.
    (i) Party includes the Department.
    (j) Person means any individual, group of individuals, partnership, 
corporation, association, cooperative, or any other legal entity subject 
to an order or to whom an order is sought to be made applicable, or on 
whom an obligation has been imposed or is sought to be imposed under an 
order.
    (k) Petition includes an amended petition.
    (l) Proceeding means a proceeding before the Secretary arising under 
the pertinent section of an Act.
    (m) Secretary means the Secretary of Agriculture of the United 
States, or any officer or employee of the Department to whom authority 
has heretofore been delegated, or to whom authority may hereafter be 
delegated, to act for the Secretary.

[67 FR 44350, July 2, 2002]



Sec. 1200.52  Institution of proceeding.

    (a) Filing and service of petitions. Any person subject to an order 
desiring to complain that such order or any provision of such order or 
any obligation imposed in connection with an order is not in accordance 
with law, shall file with the hearing clerk, in quintuplicate, a 
petition in writing addressed to the Secretary. Promptly upon receipt of 
the petition in writing the hearing clerk shall transmit a true copy 
thereof to the Administrator and the General Counsel, respectively.
    (b) Contents of petitions. A petition shall contain:
    (1) The correct name, address, and principal place of business of 
the petitioner. If the petitioner is a corporation, such fact shall be 
stated, together

[[Page 16]]

with the name of the State of incorporation, the date of incorporation, 
and the names, addresses, and respective positions held by its officers 
and directors; if an unincorporated association, the names and addresses 
of its officers, and the respective positions held by them; if a 
partnership, the name and address of each partner;
    (2) Reference to the specific terms or provisions of the order, or 
the interpretation or application of such terms or provisions, which are 
complained of;
    (3) A full statement of the facts, avoiding a mere repetition of 
detailed evidence, upon which the petition is based, and which it is 
desired that the Secretary consider, setting forth clearly and concisely 
the nature of the petitioner's business and the manner in which 
petitioner claims to be affected by the terms or provisions of the order 
or the interpretation or application thereof, which are complained of;
    (4) A statement of the grounds on which the terms or provisions of 
the order, or the interpretation or application thereof, which are 
complained of, are challenged as not in accordance with law;
    (5) Requests for the specific relief which the petitioner desires 
the Secretary to grant; and
    (6) An affidavit by the petitioner, or, if the petitioner is not an 
individual, by an officer of the petitioner having knowledge of the 
facts stated in the petition, verifying the petition and stating that it 
is filed in good faith and not for purposes of delay.
    (c) A motion to dismiss a petition: filing, contents, and responses 
to a petition. If the Administrator is of the opinion that the petition, 
or any portion thereof, does not substantially comply, in form or 
content, with the Act or with requirements of paragraph (b) of this 
section, the Administrator may, within 30 days after the service of the 
petition, file with the hearing clerk a motion to dismiss the petition, 
or any portion of the petition, on one or more of the grounds stated in 
this paragraph. Such motion shall specify the grounds for objection to 
the petition and if based, in whole or in part, on allegations of fact 
not appearing on the face of the petition, shall be accompanied by 
appropriate affidavits or documentary evidence substantiating such 
allegations of fact. The motion may be accompanied by a memorandum of 
law. Upon receipt of such motion, the hearing clerk shall cause a copy 
thereof to be served upon the petitioner, together with a notice stating 
that all papers to be submitted in opposition to such motion, including 
any memorandum of law, must be filed by the petitioner with the hearing 
clerk not later than 20 days after the service of such notice upon the 
petitioner. Upon the expiration of the time specified in such notice, or 
upon receipt of such papers from the petitioner, the hearing clerk shall 
transmit all papers which have been filed in connection with the motion 
to the judge for the judge's consideration.
    (d) Further proceedings. Further proceedings on petitions to modify 
or to be exempted from the Order shall be governed by Sec. Sec. 
900.52(c)(2) through 900.71 of the Rules of Practice Governing 
Proceedings on Petitions To Modify or To Be Exempted From Marketing 
Orders. However, each reference to marketing order in the title shall 
mean order.

[47 FR 44684, Oct. 8, 1982, as amended at 67 FR 10830, Mar. 11, 2002]



PART 1205_COTTON RESEARCH AND PROMOTION--Table of Contents




            Subpart_Procedures for Conduct of Sign-up Period

                               Definitions

Sec.
1205.10 Act.
1205.11 Administrator.
1205.12 Cotton.
1205.13 Upland cotton.
1205.14 Department.
1205.15 Farm Service Agency.
1205.16 Order.
1205.17 Person.
1205.18 Producer.
1205.19 Importer.
1205.20 Representative period.
1205.21 Secretary.
1205.22 State.
1205.23 United States.

                               Procedures

1205.24 General.
1205.25 Supervision of sign-up period.
1205.26 Eligibility.
1205.27 Participation in the sign-up period.
1205.28 Counting.

[[Page 17]]

1205.29 Reporting results.
1205.30 Instructions and forms.

               Subpart_Cotton Research and Promotion Order

                               Definitions

1205.301 Secretary.
1205.302 Act.
1205.303 Person.
1205.304 Cotton.
1205.305 Upland cotton.
1205.306 Bale.
1205.307 Fiscal period.
1205.308 Cotton Board.
1205.309 Producer.
1205.310 Importer.
1205.311 Handler.
1205.312 Handle.
1205.313 United States.
1205.314 Cotton-producing State.
1205.315 Marketing.
1205.316 Cotton-Producer organization.
1205.317 Cotton-Importer organization.
1205.318 Contracting organization or association.
1205.319 Cotton-producing region.
1205.320 Marketing year.
1205.321 Part and subpart.

                              Cotton Board

1205.322 Establishment and membership.
1205.323 Term of office.
1205.324 Nominations.
1205.325 Selection.
1205.326 Acceptance.
1205.327 Vacancies.
1205.328 Alternate members.
1205.329 Procedure.
1205.330 Compensation and reimbursement.
1205.331 Powers.
1205.332 Duties.

                         Research and Promotion

1205.333 Research and promotion.

                        Expenses and Assessments

1205.334 Expenses.
1205.335 Assessments.
1205.336 ``Importer Reimbursements''.
1205.337 Influencing governmental action.

                       Reports, Books, and Records

1205.338 Reports.
1205.339 Books and records.
1205.340 Confidential treatment.

              Certification of Cotton Producer Organization

1205.341 Certification of cotton producer organization.
1205.342 Certification of cotton importer organizations.

                              Miscellaneous

1205.343 Suspension and termination.
1205.345 Proceedings after termination.
1205.346 Effect of termination or amendment.
1205.347 Personal liability.
1205.348 Separability.

                     Subpart_Members of Cotton Board

1205.401 Definitions.
1205.402 Determination of Cotton Board membership.
1205.403 Nomination procedure.

               Subpart_Cotton Board Rules and Regulations

                               Definitions

1205.500 Terms defined.

                                 General

1205.505 Communication.

                               Assessments

1205.510 Levy of assessments.
1205.511 Payment and collection.
1205.512 Collecting handlers and time of collection of $1 per bale 
          assessment.
1205.513 Collecting handlers and time of collection of the supplemental 
          assessment.
1205.514 Customs Service and the Collection of the $1 per bale 
          assessment.
1205.515 Customs Service and the collection of the supplemental 
          assessment.
1205.516 Reports and remittance to the Cotton Board.
1205.517 Failure to report and remit.
1205.518 Receipts for payment of assessments.

                             Reimbursements

1205.520 Procedure for obtaining reimbursement.

                           Warehouse Receipts

1205.525 Entry of gin code number.

                           Reports and Records

1205.530 Gin reports and reporting schedule.
1205.531 Records.
1205.532 Retention period for reports and records.
1205.533 Availability of reports and rec ords.

                        Confidential Information

1205.540 Confidential books, records, and reports.
1205.541 OMB control numbers.

Subpart--Fiscal Period [Reserved]

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

[[Page 18]]



            Subpart_Procedures for Conduct of Sign-up Period

    Source: 62 FR 1660, Jan. 13, 1997, unless otherwise noted.

                               Definitions



Sec. 1205.10  Act.

    The term Act means the Cotton Research and Promotion Act, as amended 
[7 U.S.C 2101-2118; Public Law 89-502, 80 Stat 279, as amended].



Sec. 1205.11  Administrator.

    The term Administrator means the Administrator of the Agricultural 
Marketing Service, or any officer or employee of USDA to whom authority 
has been delegated to act in the Administrator's stead.



Sec. 1205.12  Cotton.

    The term cotton means all Upland cotton harvested in the United 
States and all imports of Upland cotton, including the Upland cotton 
content of products derived thereof. The term cotton does not include 
imported cotton for which the assessment is less than the value of $2.00 
per line item entry as established by regulations.

[62 FR 1660, Jan. 13, 1997, as amended at 67 FR 21169, Apr. 30, 2002]



Sec. 1205.13  Upland cotton.

    The term Upland cotton means all cultivated varieties of the species 
Gossypium hirsutum L.



Sec. 1205.14  Department.

    The term Department means the U.S. Department of Agriculture.



Sec. 1205.15  Farm Service Agency.

    The term Farm Service Agency--formerly Agricultural Stabilization 
and Conservation Service (ASCS)--also referred to as ``FSA,'' means the 
Farm Service Agency of the Department.



Sec. 1205.16  Order.

    The term Order means the Cotton Research and Promotion Order.



Sec. 1205.17  Person.

    The term person means any individual 18 years of age or older, or 
any partnership, corporation, association, or any other entity.



Sec. 1205.18  Producer.

    The term producer means any person who shares in a cotton crop, or 
in the proceeds thereof, as an owner of the farm, cash tenant, landlord 
of a share tenant, share tenant, or sharecropper, that planted the 
cotton during the representative period.

[67 FR 21169, Apr. 30, 2002]



Sec. 1205.19  Importer.

    The term importer means any person who enters, or withdraws from 
warehouse, cotton for consumption in the customs territory of the United 
States, and the term import means any such entry.



Sec. 1205.20  Representative period.

    The term representative period means the 2001 calendar year.

[67 FR 21169, Apr. 30, 2002]



Sec. 1205.21  Secretary.

    The term Secretary means the Secretary of Agriculture of the United 
States, or any other officer or employee of the Department to whom 
authority has been delegated to act in the Secretary's stead.



Sec. 1205.22  State.

    The term State means each of the 50 states.



Sec. 1205.23  United States.

    The term United States means the 50 states of the United States of 
America.

                               Procedures



Sec. 1205.24  General.

    A sign-up period will be conducted to determine whether eligible 
producers and importers favor the conduct of a referendum on the 
continuance of the 1991 amendments to the Order.
    (a) If the Secretary determines, based on the results of the sign-up 
period, that at least 10 percent (4,622) or more of the number of cotton 
producers and importers who voted in the 1991 referendum request the 
conduct of a continuance referendum on the 1991 Order amendments, a 
referendum will be held

[[Page 19]]

within 12 months after the end of the sign-up period. Not more than 20 
percent of the total requests counted toward the 10 percent figure may 
be from producers from any one state or from importers of cotton.
    (b) If the Secretary determines that fewer than 10 percent (4,622) 
of the number of producers and importers who voted in the 1991 
referendum do not favor a continuance referendum, no referendum will be 
held.



Sec. 1205.25  Supervision of sign-up period.

    The Administrator shall be responsible for conducting the sign-up 
period in accordance with this subpart.



Sec. 1205.26  Eligibility.

    Only persons who meet the eligibility requirements in this subpart 
may participate in the sign-up period. No person is entitled to sign up 
more than once.
    (a) Except as set forth in paragraphs (b) and (c) of this section, 
the following persons are eligible to request the conduct of a 
continuance referendum:
    (1) Any person who was engaged in the production of Upland cotton 
during calendar year 2001; and
    (2) Any person who was an importer of Upland cotton and imported 
Upland cotton in excess of the value of $2.00 per line item entry during 
calendar year 2001.
    (b) A general partnership is not eligible to request a continuance 
referendum, however, the individual partners of an eligible general 
partnership are each entitled to submit a request.
    (c) Where a group of individuals is engaged in the production of 
Upland cotton under the same lease or cropping agreement, only the 
individual or individuals who signed or entered into the lease or 
cropping agreement are eligible to participate in the sign-up period. 
Individuals who are engaged in the production of Upland cotton as joint 
tenants, tenants in common, or owners of community property, are each 
entitled to submit a request if they share in the proceeds of the 
required crop as owners, cash tenants, share tenants, sharecroppers or 
landlords of a fixed rent, standing rent or share tenant.
    (d) An officer or authorized representative of a qualified 
corporation, association, or limited partnership may submit a request on 
behalf of that corporation, association, or limited partnership.
    (e) A guardian, administrator, executor, or trustee of any qualified 
estate or trust may submit a request on behalf of that estate or trust.
    (f) An individual may not submit a request on behalf of another 
individual.
    (g) Participation in the sign-up by proxy or power of attorney is 
not authorized.

[62 FR 1660, Jan. 13, 1997, as amended at 67 FR 21169, Apr. 30, 2002]



Sec. 1205.27  Participation in the sign-up period.

    The sign-up period will be from June 3, 2002, through August 30, 
2002. Those persons who favor the conduct of a continuance referendum 
and who wish to request that USDA conduct such a referendum may do so by 
submitting such request in accordance with this section. All requests 
must be received by the appropriate USDA office by August 30, 2002.
    (a) Before the sign-up period begins, FSA shall establish a list of 
known, eligible, Upland cotton producers in the county that it serves 
during the representative period, and shall also establish a list of 
known, eligible Upland cotton importers.
    (b) Before the start of the sign-up period, USDA shall mail a 
request form to each known, eligible, cotton importer. Importers who 
wish to request a referendum and who do not receive a request form in 
the mail by June 3, 2002, may participate in the sign-up period by 
submitting a signed, written request for a continuance referendum, along 
with a copy of a U.S. Customs form 7501 showing payment of a cotton 
assessment for calendar year 2001. Importers must submit their requests 
and supporting documents to USDA, FSA, ORAS, Attention: Phil Brockman, 
PO Box 23278, Washington, DC 20026-3278. All requests and supporting 
documents must be received by the appropriate FSA office by August 30, 
2002.
    (c) Each person on the county FSA office lists may participate in 
the sign-up period. Eligible producers must date

[[Page 20]]

and sign their name on the ``County FSA Office Sign-up Sheet.'' A person 
whose name does not appear on the county FSA office list may participate 
in the sign-up period. Such person must be identified on FSA-578 during 
the representative period or provide documentation that demonstrates 
that the person was a cotton producer during the representative period. 
Cotton producers not listed on the FSA-578 shall submit at least one 
sales receipt for cotton they planted during the representative period. 
Cotton producers must make requests to the county FSA office where the 
producer's farm is located. If the producer's land is in more than one 
county, the producer shall make request at the county office where FSA 
administratively maintains and processes the producer's farm records. It 
is the responsibility of the person to provide the information needed by 
the county FSA office to determine eligibility. It is not the 
responsibility of the county FSA office to obtain this information. If 
any person whose name does not appear on the county FSA office list 
fails to provide at least one sales receipt for the cotton they produced 
during the representative period, the county FSA office shall determine 
that such person is ineligible to participate in the sign-up period, and 
shall note ineligible in the remarks section next to the person's name 
on the county FSA office sign-up sheet. In lieu of personally appearing 
at a county FSA office, eligible producers may request a sign-up form 
from the county FSA office where the producer's farm is located. If the 
producer's land is in more than one county, the producer shall make the 
request for the sign-up form at the county office where FSA 
administratively maintains and processes the producer's farm records. 
Such request must be accompanied by a copy of at least one sales receipt 
for cotton they produced during the representative period. The 
appropriate FSA office must receive all completed forms and supporting 
documentation by August 30, 2002.

[67 FR 21169, Apr. 30, 2002]



Sec. 1205.28  Counting.

    County FSA offices and FSA, Director for Operations Review and 
Analysis Staff (ORAS), shall begin counting requests no later than 
September 3, 2002. FSA shall determine the number of eligible persons 
who favor the conduct of a continuance referendum.

[62 FR 1660, Jan. 13, 1997, as amended at 67 FR 21170, Apr. 30, 2002]



Sec. 1205.29  Reporting results.

    (a) Each county FSA office shall prepare and transmit to the state 
FSA office, by September 10, 2002, a written report of the number of 
eligible producers who requested the conduct of a referendum, and the 
number of ineligible persons who made requests.
    (b) ORAS shall prepare, by September 10, 2002, a written report of 
the number of eligible importers who requested the conduct of a 
referendum, and the number of ineligible persons who made requests.
    (c) Each state FSA office shall, by September 17, 2002, forward all 
county reports to ORAS. By September 24, 2002, ORAS shall forward its 
report of the total number of eligible producers and importers that 
requested a continuance referendum, through the sign-up period, to the 
Deputy Administrator, Cotton Program, AMS, Stop 0224, 1400 Independence 
Ave., SW, Washington, DC 20250-0224.
    (d) The Chief of the Research and Promotion Staff, Cotton Program, 
shall prepare a report of the requests received, including the number of 
eligible persons who requested the conduct of a referendum, and the 
number of ineligible persons who made requests, to the Deputy 
Administrator of the Cotton Program, and shall maintain one copy of the 
report where it will be available for public inspection for a period of 
5 years following the end of the sign-up period.
    (e) The Deputy Administrator of the Cotton Program shall prepare and 
submit to the Secretary a report of the results of the sign-up period. 
The Secretary will conduct a referendum if requested by 10 percent or 
more of the number of cotton producers and importers voting in the most 
recent (July 1991) referendum, but not more than 20 percent of the total 
requests counted toward the 10 percent figure may be from producers in 
any one state or

[[Page 21]]

from importers of cotton. The Secretary shall announce the results of 
the sign-up period in a separate notice in the Federal Register.

[67 FR 21170, Apr. 30, 2002]



Sec. 1205.30  Instructions and forms.

    The Administrator is hereby authorized to prescribe additional 
instructions and forms consistent with the provisions of this subpart to 
govern conduct of the sign-up period.



               Subpart_Cotton Research and Promotion Order

    Source: 31 FR 16758, Dec. 31, 1966, unless otherwise noted.

                               Definitions



Sec. 1205.301  Secretary.

    Secretary means the Secretary of Agriculture of the United States, 
or any officer or employee of the U.S. Department of Agriculture to whom 
authority has heretofore been delegated, or to whom authority may 
hereafter be delegated, to act in his stead.



Sec. 1205.302  Act.

    Act means the Cotton Research and Promotion Act, as amended (7 
U.S.C. 2101-2118; Public Law 89-502, 80 Stat 279, as amended).

[56 FR 64472, Dec. 10, 1991]



Sec. 1205.303  Person.

    Person means any individual, partnership, corporation, association, 
or any other entity.



Sec. 1205.304  Cotton.

    Cotton means:
    (a) All Upland cotton harvested in the United States, and, except as 
used in Sec. Sec. 1205.311 and 1205.335, includes cottonseed of such 
cotton and the products derived from such cotton and its seed, and
    (b) Imports of Upland cotton, including the Upland cotton content of 
the products derived thereof. The term ``cotton'' shall not, however, 
include:
    (1) Any entry of imported cotton by an importer which has a value or 
weight less than a de minimis amount established in regulations issued 
by the Secretary and
    (2) Industrial products as that term is defined by regulation.

[56 FR 64472, Dec. 10, 1991]



Sec. 1205.305  Upland cotton.

    Upland cotton means all cultivated varieties of the species 
Gossypium hirsutum L.

[56 FR 64472, Dec. 10, 1991]



Sec. 1205.306  Bale.

    Except as used in Sec. 1205.322, Bale means the package of lint 
cotton produced at a cotton gin or the amount of processed cotton in a 
manufactured product that is equivalent to a 500 pound bale of lint 
cotton.

[56 FR 64472, Dec. 10, 1991]



Sec. 1205.307  Fiscal period.

    Fiscal period is the 12-month budgetary period and means the 
calendar year unless the Cotton Board, with the approval of the 
Secretary, selects some other 12-months budgetary period.

[31 FR 16758, Dec. 31, 1966. Redesignated at 56 FR 64472, Dec. 10, 1991]



Sec. 1205.308  Cotton Board.

    Cotton Board means the administrative body established pursuant to 
Sec. 1205.318.

[31 FR 16758, Dec. 31, 1966. Redesignated at 56 FR 64472, Dec. 10, 1991]



Sec. 1205.309  Producer.

    Producer means any person who shares in a cotton crop actually 
harvested on a farm, or in the proceeds thereof, as an owner of the 
farm, cash tenant, landlord of a share tenant, share tenant, or 
sharecropper.

[31 FR 16758, Dec. 31, 1966. Redesignated at 56 FR 64472, Dec. 10, 1991]



Sec. 1205.310  Importer.

    Importer means many person who enters, or withdraws from warehouse, 
cotton for consumption in the customs territory of the United States, 
and the term import means any such entry.

[56 FR 64472, Dec. 10, 1991]

[[Page 22]]



Sec. 1205.311  Handler.

    Handler means any person who handles cotton, including the Commodity 
Credit Corporation.

[31 FR 16758, Dec. 31, 1966. Redesignated at 56 FR 64472, Dec. 10, 1991]



Sec. 1205.312  Handle.

    Handle means to harvest, gin, warehouse, compress, purchase, market, 
transport, or otherwise acquire ownership or control of cotton.

[31 FR 16758, Dec. 31, 1966. Redesignated at 56 FR 64472, Dec. 10, 1991]



Sec. 1205.313  United States.

    United States means the 50 States of the United States of America.

[31 FR 16758, Dec. 31, 1966. Redesignated at 56 FR 64472, Dec. 10, 1991]



Sec. 1205.314  Cotton-producing State

    Cotton-producing State means each of the following States and 
combinations of States:

Alabama-Florida; Arizona; Arkansas; California-Nevada; Georgia; 
Louisiana; Mississippi; Missouri-Illinois; New Mexico; North Carolina-
Virginia; Oklahoma; South Carolina; Tennessee-Kentucky; Texas.

[31 FR 16758, Dec. 31, 1966. Redesignated at 56 FR 64472, Dec. 10, 1991]



Sec. 1205.315  Marketing.

    Marketing includes the sale of cotton or the pledging of cotton to 
the Commodity Credit Corporation as collateral for a price support loan.

[31 FR 16758, Dec. 31, 1966. Redesignated at 56 FR 64472, Dec. 10, 1991]



Sec. 1205.316  Cotton-Producer organization.

    Cotton-Producer organization means any organization which has been 
certified by the Secretary pursuant to Sec. 1205.341.

[56 FR 64472, Dec. 10, 1991]



Sec. 1205.317  Cotton-Importer organization.

    Cotton-Importer organization means any organization which has been 
certified by the Secretary pursuant to Sec. 1205.342.

[56 FR 64472, Dec. 10, 1991]



Sec. 1205.318  Contracting organization or association.

    Contracting organization or association means the organization or 
association with which the Cotton Board has entered into a contract or 
agreement pursuant to Sec. 1205.328(c).

[31 FR 16758, Dec. 31, 1966. Redesignated at 56 FR 64472, Dec. 10, 1991]



Sec. 1205.319  Cotton-producing region.

    Cotton-producing region means each of the following groups of 
cotton-producing States:
    (a) Southeast Region: Alabama-Florida, Georgia, North Carolina-
Virginia, and South Carolina;
    (b) Midsouth Region: Arkansas, Louisiana, Mississippi, Missouri-
Illinois, and Tennessee-Kentucky;
    (c) Southwest Region: Oklahoma and Texas;
    (d) Western Region: Arizona, California-Nevada, and New Mexico.

[31 FR 16758, Dec. 31, 1966. Redesignated at 56 FR 64472, Dec. 10, 1991]



Sec. 1205.320  Marketing year.

    Marketing year means a consecutive 12-month period ending on July 
31.

[31 FR 16758, Dec. 31, 1966. Redesignated at 56 FR 64472, Dec. 10, 1991]



Sec. 1205.321  Part and subpart.

    Part means the cotton research and promotion order and all rules, 
regulations and supplemental orders issued pursuant to the act and the 
order, and the aforesaid order shall be a ``subpart'' of such part.

[31 FR 16758, Dec. 31, 1966. Redesignated at 56 FR 64472, Dec. 10, 1991]

                              Cotton Board



Sec. 1205.322  Establishment and membership.

    (a) There is hereby established a Cotton Board composed of:
    (1) Representatives of cotton producers, each of whom shall have an 
alternate, selected by the Secretary from nominations submitted by 
eligible producer organizations within a cotton-producing state, as 
certified pursuant to Sec. 1205.341, or, if the Secretary determines 
that a substantial number of producers are not members of or their

[[Page 23]]

interests are not represented by any such eligible organizations, from 
nominations made by producers in a manner authorized by the Secretary, 
and
    (2) Representatives of cotton importers, each of whom shall have an 
alternate, selected by the Secretary from nominations submitted by 
eligible importer organizations, as certified pursuant to Sec. 
1205.342, or, if the Secretary determines that a substantial number of 
importers are not members of or their interests are not represented by 
any such eligible organization, from nominations made by importers in a 
manner authorized by the Secretary.
    (b) Representation on the Cotton Board shall be as follows:
    (1) Each cotton-producing state shall have at least one member and 
an additional member for each 1 million bales or major fraction (more 
than half) thereof of cotton produced in the state and marketed above 
one million bales during the period specified in the regulations for 
determining Board membership; and
    (2) Cotton importers shall be represented by an appropriate number 
of representatives, as determined by the Secretary, of importers of 
cotton subject to assessment during the period specified in the 
regulations for determining Board membership. That number shall not be 
less than two members. The initial importer representation on the Board 
shall consist of four representatives. The Secretary may, after 
consultation with organizations representing importers, reduce or 
increase the number of importer representatives, in the manner 
prescribed by the Secretary.

[56 FR 64472, Dec. 10, 1991]



Sec. 1205.323  Term of office.

    All members of the Board and their alternatives shall serve for 
terms of three years. Each member and alternate shall continue to serve 
until a successor is selected and has qualified.

[56 FR 64472, Dec. 10, 1991]



Sec. 1205.324  Nominations.

    All nominations authorized under Sec. 1205.322 shall be made within 
such a period of time and in such a manner as the Secretary shall 
prescribe. The eligible producer organizations within each cotton-
producing state, as certified pursuant to Sec. 1205.341, shall caucus 
for the purpose of jointly nominating two qualified persons for each 
member and each alternate member to be selected to represent the cotton 
producers of such cotton-producing state. The eligible importer 
organizations, as certified pursuant to Sec. 1205.342, shall caucus for 
the purpose of jointly nominating two qualified persons for each member 
and alternate member to be selected to represent cotton importers. If 
joint agreement is not reached with respect to the nominees for any such 
position, each such organization may nominate two qualified persons for 
any position on which there is no agreement.

[56 FR 64472, Dec. 10, 1991; 56 FR 66670, Dec. 24, 1991]



Sec. 1205.325  Selection.

    From the nominations made pursuant to Sec. Sec. 1205.322 and 
1205.324, the Secretary shall select the members of the Board and an 
alternate for each member on the basis of representation provided for in 
Sec. Sec. 1205.322 and 1205.323.

[56 FR 64473, Dec. 10, 1991]



Sec. 1205.326  Acceptance.

    Any person selected by the Secretary as a member or as an alternate 
member of the Board shall qualify by filing a written acceptance with 
the Secretary promptly after being notified of such selection.

[31 FR 16758, Dec. 31, 1966. Redesignated at 56 FR 64472, Dec. 10, 1991]



Sec. 1205.327  Vacancies.

    To fill any vacancy occasioned by the failure of any person selected 
as a member or as an alternate member of the Board to qualify, or in the 
event of death, removal, resignation or disqualification of any member 
or alternate member of the Board, a successor for the unexpired term of 
such member or alternate member of the Board shall be nominated and 
selected in the manner specified in Sec. Sec. 1205.322, 1205.324 and 
1205.325.

[56 FR 64473, Dec. 10, 1991]

[[Page 24]]



Sec. 1205.328  Alternate members.

    An alternate member of the Board, during the absence of the member 
for whom the person is the alternate, shall act in the place and stead 
of such member and perform such other duties as assigned. In the event 
of death, removal, resignation or disqualification of a member, the 
alternate for the member shall act for the member until a successor for 
such member is selected and qualified. In the event that both a producer 
member of the Board and the member's alternate are unable to attend a 
meeting, the Board may designate any other alternate member from the 
same cotton-producing state or region to serve in such member's place 
and stead of such meeting. In the event that both an importer member and 
the member's alternate are unable to attend a meeting, the Board may 
designate any other importer alternate member to serve in such member's 
place and stead at such meeting.

[56 FR 64473, Dec. 10, 1991]



Sec. 1205.329  Procedure.

    A majority of the members of the Board, or alternates acting for 
members, shall constitute a quorum and any action of the Board shall 
require the concurring votes of at least a majority of those present and 
voting. At assembled meetings all votes shall be cast in person. For 
routine and noncontroversial matters which do not require deliberation 
and the exchange of views, and in matters of an emergency nature when 
there is not enough time to call an assembled meeting of the Board, the 
Board may also take action upon the concurring votes of a majority of 
its members by mail, telegraph or telephone, but any such action by 
telephone shall be confirmed promptly in writing.

[31 FR 16758, Dec. 31, 1966. Redesignated at 56 FR 64472, Dec. 10, 1991]



Sec. 1205.330  Compensation and reimbursement.

    The members of the Board, and alternates when acting as members, 
shall serve without compensation but shall be reimbursed for necessary 
expenses, as approved by the Board, incurred by them in the performance 
of their duties under this subpart.

[31 FR 16758, Dec. 31, 1966. Redesignated at 56 FR 64472, Dec. 10, 1991]



Sec. 1205.331  Powers.

    The Board shall have the following powers:
    (a) To administer the provisions of this subpart in accordance with 
its terms and provisions;
    (b) Subject to the approval of the Secretary, to make rules and 
regulations to effectuate the terms and provisions of this subpart 
including the designation of the handler, importer, or other person 
responsible for collecting the assessments authorized by Sec. 1205.335, 
which designation may be of different handlers, importers, or other 
persons, or classes of handlers, importers, or other persons, to 
recognize differences in marketing practices or procedures in any state 
or area;
    (c) To receive, investigate, and report to the Secretary complaints 
of violations of the provisions of this subpart;
    (d) To recommend to the Secretary amendments to this subpart.

[31 FR 16758, Dec. 31, 1966, as amended at 42 FR 4813, Jan. 26, 1977. 
Redesignated and amended at 56 FR 64472, 64473, Dec. 10, 1991]



Sec. 1205.332  Duties.

    The Board shall have the following duties:
    (a) To select from among its members a chairman and such other 
officers as may be necessary for the conduct of its business, and to 
define their duties;
    (b) To appoint or employ such persons as it may deem necessary and 
to determine the compensation and to define the duties of each;
    (c) With the approval of the Secretary, to enter into contracts or 
agreements for the development and submission to it of research and 
promotion plans or projects authorized by Sec. 1205.333, and for the 
carrying out of such plans or projects when approved by the Secretary, 
and for the payment of costs thereof with funds collected pursuant to 
Sec. 1205.335, with an organization or association whose governing body 
consists of cotton producers selected by the cotton-producer 
organizations certified by the Secretary under

[[Page 25]]

Sec. 1205.341, in such manner that the producers of each cotton-
producing state will, to the extent practicable, have representation on 
the governing body of such organization in the proportion that the 
cotton marketed by the producers of such state bears to the total 
marketed by the producers of all cotton-producing states. Any such 
contract or agreement shall provide that such contracting organization 
or association shall develop and submit annually to the Cotton Board, 
for the purpose of review and making recommendations to the Secretary, a 
program of research, advertising, and sales promotion projects, together 
with a budget, or budgets, which shall show the estimated cost to be 
incurred for such projects, and that any such projects shall become 
effective upon approval by the Secretary. Any such contract or agreement 
shall also provide that the contracting organization shall keep accurate 
records of all its transactions, which shall be available to the 
Secretary and Board on demand, and make an annual report to the Cotton 
Board of activities carried out and an accounting for funds received and 
expended, and such other reports as the Secretary may require;
    (d) To review and submit to the Secretary any research and promotion 
plans or projects which have been developed and submitted to it by the 
contracting organization or association, together with its 
recommendations with respect to the approval thereof by the Secretary;
    (e) To submit to the Secretary for his approval budgets on a fiscal 
period basis of its anticipated expenses and disbursements in the 
administration of this subpart, including probable costs of advertising 
and promotion and research and development projects as estimated in the 
budget or budgets submitted to it by the contracting organization or 
association, with the Board's recommendations with respect thereto;
    (f) To maintain such books and rec ords and prepare and submit such 
reports from time to time to the Secretary as he may prescribe, and to 
make appropriate accounting with respect to the receipt and disbursement 
of all funds entrusted to it;
    (g) To cause its books to be audited by a competent public 
accountant at least once each fiscal period and at such other times as 
the Secretary may request, and to submit a copy of each such audit to 
the Secretary;
    (h) To give the Secretary the same notice of meetings of the Board 
as is given to members in order that his representative may attend such 
meetings;
    (i) To act as intermediary between the Secretary and any producer, 
importer, or handler.
    (j) To submit to the Secretary such information as he may request.

[31 FR 16758, Dec. 31, 1966. Redesignated and amended at 56 FR 64472, 
64473, Dec. 10, 1991]

                         Research and Promotion



Sec. 1205.333  Research and promotion.

    The Cotton Board shall in the manner prescribed in Sec. 1205.332(c) 
establish or provide for:
    (a) The establishment, issuance, effectuation, and administration of 
appropriate plans or projects for the advertising and sales promotion of 
cotton and its products, which plans or projects shall be directed 
toward increasing the general demand for cotton or its products in 
accordance with section 6(a) of the act;
    (b) The establishment and carrying on of research and development 
projects and studies with respect to the production, ginning, 
processing, distribution, or utilization of cotton and its products in 
accordance with section 6(b) of the act, to the end that the marketing 
and utilization of cotton may be encouraged, expanded, improved, or made 
more efficient.

[31 FR 16758, Dec. 31, 1966. Redesignated and amended at 56 FR 64472, 
64473, Dec. 10, 1991]

                        Expenses and Assessments



Sec. 1205.334  Expenses.

    (a) The Board is authorized to incur such expenses as the Secretary 
finds are reasonable and likely to be incurred by the Board for its 
maintenance and functioning and to enable it to exercise its powers and 
perform its duties in accordance with the provisions of this subpart.
    (b) The Board shall reimburse the Secretary for:

[[Page 26]]

    (1) Expenses up to $300,000 incurred by the Secretary in connection 
with any referendum conducted under the Act and
    (2) Expenses incurred by the Department of Agriculture for 
administrative and supervisory costs up to five employee years annually.
    (c) The Board shall reimburse any agency of the United States 
Government that assists in administering the import provisions of the 
order for a reasonable amount of the expenses incurred by that agency in 
connection therewith.
    (d) The funds to cover such expenses incurred under paragraphs (a), 
(b) and (c) of this section shall be paid from assessments received 
pursuant to Sec. 1205.335.

[42 FR 4813, Jan. 26, 1977. Redesignated and amended at 56 FR 64472, 
64473, Dec. 10, 1991]



Sec. 1205.335  Assessments.

    (a) Each cotton producer or other person for whom cotton is being 
handled shall pay to the handler thereof designated by the Cotton Board 
pursuant to regulations issued by the Secretary and such handler shall 
collect from the producer or other person for whom the cotton, including 
cotton owned by the handler, is being handled, and shall pay to the 
Cotton Board, at such times and in such manner as prescribed by 
regulations issued by the Secretary, assessments as prescribed in 
paragraphs (a) (1) and (2) of this section:
    (1) An assessment at the rate of $1 per bale of cotton handled;
    (2) A supplemental assessment on cotton handled which shall not 
exceed one percent of the value of such cotton as determined by the 
Cotton Board and approved by the Secretary and published in the Cotton 
Board rules and regulations. The rate of the supplemental assessment may 
be increased or decreased by the Cotton Board with the approval of the 
Secretary. The Secretary shall prescribe by regulation whether the 
assessment rate shall be levied on:
    (i) The current value of the cotton, or
    (ii) An average value determined from current and/or historical 
cotton prices and converted to a fixed amount for each bale.
    (b) Each importer of cotton shall pay to the Cotton Board through 
the U.S. Customs Service, or in such other manner and at such times as 
prescribed by regulations issued by the Secretary, assessments as 
prescribed in paragraphs (b)(1) and (2) of this section:
    (1) An assessment of $1 per bale of cotton imported or the bale 
equivalent thereof for cotton products.
    (2) A supplemental assessment on each bale of cotton imported, or 
the bale equivalent thereof for cotton products, which shall not exceed 
one percent of the value of such cotton as determined by the Cotton 
Board and approved by the Secretary and published in the Cotton Board 
rules and regulations. The rate of the supplemental assessment on 
imported cotton shall be the same as that paid on cotton produced in the 
United States. The rate of the supplemental assessment may be increased 
or decreased by the Cotton Board with the approval of the Secretary. The 
Secretary shall prescribe by regulation the value of imported cotton 
based on an average of current and/or historical cotton prices.
    (c) The Secretary may designate by regulation exemptions to 
assessments provided for in this section for the following:
    (1) Entries of products designated by specific Harmonized Tariff 
Schedule numbers which the Secretary determines are composed of U.S. 
cotton or other than Upland cotton, and for;
    (2) Cotton contained in entries of imported cotton and cotton 
products that is U.S. produced cotton or is other than Upland cotton.
    (d) Assessments collected under this section are to be used for such 
expenses and expenditures, including provision for a reasonable reserve, 
as the Secretary finds reasonable and likely to be incurred by the 
Cotton Board and the Secretary under this subpart.

[56 FR 64473, Dec. 10, 1991]



Sec. 1205.336  ``Importer Reimbursements''.

    Any cotton importer against whose imports any assessment is made and 
collected under the authority of the Act who has reason to believe that 
such assessment or any portion of such assessment was made on U.S. 
produced

[[Page 27]]

cotton or cotton other than Upland cotton shall have the right to demand 
and receive from the Cotton Board a reimbursement of the assessment or 
portion of the assessment upon submission of proof satisfactory to the 
Board that the importer paid the assessment and that the cotton was 
produced in the U.S. or is other than Upland cotton. Any such demand 
shall be made by the importer in accordance with regulations and on a 
form and within a time period prescribed by the Board and approved by 
the Secretary. Such time periods shall provide the importer at least 90 
days from the date of collection to submit the reimbursement form to the 
Board. Any such reimbursement shall be made within 60 days after demand 
therefor.

[56 FR 64474, Dec. 10, 1991]



Sec. 1205.337  Influencing governmental action.

    No funds collected by the Board under this subpart shall in any 
manner be used for the purpose of influencing governmental policy or 
action except in recommending to the Secretary amendments to this 
subpart.

[31 FR 16758, Dec. 31, 1966. Redesignated at 56 FR 64472, Dec. 10, 1991]

                       Reports, Books, and Records



Sec. 1205.338  Reports.

    Each handler and importer subject to this subpart and importers of 
de minimis amounts of cotton may be required to report to the Cotton 
Board periodically such information as is required by regulations, which 
may include but not be limited to the following:
    (a) Number of bales handled or imported;
    (b) Number of bales on which an assessment was collected;
    (c) Name and address of person from whom the handler has collected 
the assessments on each bale handled or imported;
    (d) Date collection was made on each bale handled or imported.

[56 FR 64474, Dec. 10, 1991]



Sec. 1205.339  Books and records.

    Each handler and importer subject to this subpart and importers of 
de minimis amounts of cotton shall maintain and make available for 
inspection by the Secretary such books and records as are necessary to 
carry out the provisions of this subpart and the regulations issued 
thereunder, including such records as are necessary to verify any 
reports required. Such records shall be retained for at least two years 
beyond the marketing year of their applicability.

[56 FR 64474, Dec. 10, 1991]



Sec. 1205.340  Confidential treatment.

    All information obtained from such books, records or reports shall 
be kept confidential by all officers and employees of the Department of 
Agriculture and of the Cotton Board, and only such information so 
furnished or acquired as the Secretary deems relevant shall be disclosed 
by them, and then only in a suit or administrative hearing brought at 
the direction, or upon the request, of the Secretary of Agriculture, or 
to which the Secretary or any officer of the United States is a party, 
and involving this subpart. Nothing in this Sec. 1205.340 shall be 
deemed to prohibit:
    (a) The issuance of general statements based upon the reports of a 
number of handlers or importers subject to this subpart or importers of 
de minimis amounts of cotton, which statements do not identify the 
information furnished by any person, or
    (b) The publication by the direction of the Secretary, of the name 
of any person violating this subpart, together with a statement of the 
particular provisions of this subpart violated by such person.

[56 FR 64474, Dec. 10, 1991]

              Certification of Cotton Producer Organization



Sec. 1205.341  Certification of cotton producer organization.

    Any cotton producer organization within a cotton-producing State may 
request the Secretary for certification of eligibility to participate in 
nominating members and alternate members to represent such State on the 
Cotton Board. Such eligibility shall be

[[Page 28]]

based in addition to other available information upon a factual report 
submitted by the organization which shall contain information deemed 
relevant and specified by the Secretary for the making of such 
determination, including the following:
    (a) Geographic territory within the State covered by the 
organization's active membership;
    (b) Nature and size of the organization's active membership in the 
State, proportion of total of such active membership accounted for by 
farmers, a map showing the cotton-producing counties in such State in 
which the organization has members, the volume of cotton produced in 
each such county, the number of cotton producers in each such county, 
and the size of the organization's active cotton producer membership in 
each such county;
    (c) The extent to which the cotton producer membership of such 
organization is represented in setting the organization's policies;
    (d) Evidence of stability and permanency of the organization;
    (e) Sources from which the organization's operating funds are 
derived;
    (f) Functions of the organization; and
    (g) The organization's ability and willingness to further the aims 
and objectives of the act.

The primary consideration in determining the eligibility of an 
organization shall be whether its cotton producer membership consists of 
a sufficiently large number of cotton producers who produce a relatively 
significant volume of cotton to reasonably warrant its participation in 
the nomination of members for the Cotton Board. Any cotton producer 
organization found eligible by the Secretary under this Sec. 1205.341 
will be certified by the Secretary, and the Secretary's determination as 
to eligibility is final.

[31 FR 16758, Dec. 31, 1966. Redesignated and amended at 56 FR 64472, 
64474, Dec. 10, 1991]



Sec. 1205.342  Certification of cotton importer organizations.

    Any importer organization may request the Secretary for 
certification of eligibility to participate in nominating members and 
alternate members to represent cotton importers on the Cotton Board. 
Such eligibility shall be based, in addition to other available 
information, upon a factual report submitted by the organization which 
shall contain information deemed relevant and specified by the Secretary 
for the making of such determination, including the following:
    (a) Nature and size of organization's active membership, proportion 
of total active membership accounted for by cotton importers and the 
total amount of cotton imported by the organization's cotton importer 
members;
    (b) The extent to which the cotton importer membership of such 
organization is represented in setting the organization's policies;
    (c) Evidence of stability and permanency of the organization;
    (d) Sources from which the organization's operating funds are 
derived;
    (e) Functions of the organization; and
    (f) The organization's ability and willingness to further the aims 
and objectives of the Act.
    The primary consideration in determining the eligibility of an 
organization shall be whether its membership consist of a sufficient 
large number of cotton importers who import a relatively significant 
volume of cotton to reasonably warrant its participation in the 
nomination of members for the Cotton Board. Any importer organization 
found eligible by the Secretary under this Sec. 1205.342 will be 
certified by the Secretary, and the Secretary's determination as to 
eligibility is final.

[56 FR 64475, Dec. 10, 1991]

                              Miscellaneous



Sec. 1205.343  Suspension and termination.

    (a) The Secretary will, whenever the Secretary finds that this 
subpart or any provision thereof obstructs or does not tend to 
effectuate the declared policy of the Act, terminate or suspend the 
operation of this subpart or such provision.
    (b) The Secretary may conduct a referendum at any time, and shall 
hold a referendum on request of 10 percent or more of the number of 
cotton producers and importers (if subject to the Order) voting in the 
most recent referendum, to determine whether cotton

[[Page 29]]

producers and importers subject to the Order favor the suspension or 
termination of this subpart, except that in counting such request for a 
referendum, not more than 20 percent of such request may be from 
producers from any one state or importers of cotton (if subject to the 
Order). The Secretary shall suspend or terminate such subpart at the end 
of the marketing year whenever the Secretary determines that its 
suspension or termination is approved or favored by a majority of 
producers and importers subject to the Order voting in such referendum 
who, during a representative period determined by the Secretary, have 
been engaged in the production or importation of cotton, and who 
produced and imported more than 50 percent of the volume of cotton 
produced and imported by those voting in the referendum.

[56 FR 64474, Dec. 10, 1991]



Sec. 1205.345  Proceedings after termination.

    (a) Upon the termination of this subpart the Cotton Board shall 
recommend not more than five of its members to the Secretary to serve as 
trustees, for the purpose of liquidating the affairs of the Cotton 
Board. Such persons, upon designation by the Secretary, shall become 
trustees of all of the funds and property then in the possession or 
under control of the Board, including claims for any funds unpaid or 
property not delivered or any other claim existing at the time of such 
termination.
    (b) The said trustees shall--
    (1) Continue in such capacity until discharged by the Secretary;
    (2) Carry out the obligations of the Cotton Board under any 
contracts or agreements entered into by it pursuant to Sec. 1205.332 
(c);
    (3) From time-to-time account for all receipts and disbursements and 
deliver all property on hand, together with all books and records of the 
Board and the trustees, to such person or persons as the Secretary may 
direct; and
    (4) Upon request of the Secretary execute such assignments or other 
instruments necessary or appropriate to vest in such persons full title 
and right to all funds, property and claims vested in the Board or the 
trustees pursuant to this Sec. 1205.345.
    (c) Any person to whom funds, property or claims have been 
transferred or delivered pursuant to this Sec. 1205.345 shall be 
subject to the same obligation imposed upon the Cotton Board and upon 
the trustees.
    (d) Any residual funds not required to defray the necessary expenses 
of liquidation shall be turned over to the Secretary to be disposed of, 
to the extent practicable, in the interest of continuing one or more of 
the cotton research or promotion programs hitherto authorized.

[31 FR 16758, Dec. 31, 1966. Redesignated and amended at 56 FR 64472, 
64475, Dec. 10, 1991]



Sec. 1205.346  Effect of termination or amendment.

    Unless otherwise expressly provided by the Secretary, the 
termination of this subpart or of any regulation issued pursuant 
thereto, or the issuance of any amendment to either thereof, shall not 
(a) affect or waive any right, duty, obligation, or liability which 
shall have arisen or which may thereafter arise in connection with any 
provision of this subpart or any regulation issued thereunder, or (b) 
release or extinguish any violation of this subpart or any regulation 
issued thereunder, or (c) affect or impair any rights or remedies of the 
United States, or of the Secretary, or of any other person, with respect 
to any such violation.

[31 FR 16758, Dec. 31, 1966. Redesignated at 56 FR 64472, Dec. 10, 1991]



Sec. 1205.347  Personal liability.

    No member or alternate member of the Cotton Board shall be held 
personally responsible, either individually or jointly with others, in 
any way whatsoever, to any person for errors in judgment, mistakes, or 
other acts, either of commission or omission, as such member or 
alternate, except for acts of dishonesty or willful misconduct.

[31 FR 16758, Dec. 31, 1966. Redesignated at 56 FR 64472, Dec. 10, 1991]



Sec. 1205.348  Separability.

    If any provision of this subpart is declared invalid or the 
applicability thereof to any person or circumstances

[[Page 30]]

is held invalid, the validity of the remainder of this subpart or the 
applicability thereof to other persons or circumstances shall not be 
affected thereby.

[31 FR 16758, Dec. 31, 1966. Redesignated at 56 FR 64472, Dec. 10, 1991]



                     Subpart_Members of Cotton Board



Sec. 1205.401  Definitions.

    (a) Cotton Division. Cotton Division means the Cotton Division of 
the Agricultural Marketing Service of the U.S. Department of 
Agriculture.
    (b) Director. Director means the Director of the Cotton Division.

[32 FR 1084, Jan. 31, 1967, as amended at 41 FR 37092, Sept. 2, 1976]



Sec. 1205.402  Determination of Cotton Board membership.

    (a) In determining whether any cotton-producing state is entitled to 
be represented by more than one member of the Cotton Board as provided 
in Sec. 1205.322, average annual production of Upland cotton in terms 
of 480-pound net weight bales for the five most recent marketing years 
will be used as the criteria for determination of such additional 
members.
    (b) In determining whether importers of cotton and cotton-containing 
products are entitled to be represented by more than a minimum of two 
members on the Cotton Board as provided in Sec. 1205.322, the average 
annual volume of imported cotton and the cotton content of imported 
products on which assessments have been collected will be used as the 
criteria for determination of such additional members. This volume of 
cotton will be expressed in terms of 480-pound net weight bales for the 
five most recent calendar years. The initial importer representation on 
the Board shall consist of four importer representatives.
    (c) All members appointed from a state will be entitled to serve a 
full three-year term even though it is determined in a subsequent year 
that a state should have fewer additional members by using the average 
production of the five most recent marketing years as specified in 
paragraph (a) of this section.
    (d) All members appointed to represent importers will be entitled to 
serve a full three-year term even though it is determined in a 
subsequent year that importers should be represented by fewer additional 
members by using the average volume of imports of cotton and the cotton 
content of products on which assessments have been collected as 
specified in paragraph (b) of this section.
    (e) Each year the Director shall:
    (1) Based on the average annual production of Upland cotton in terms 
of 480-pound net weight bales for the five most recent marketing years, 
notify all certified cotton producer organizations in each cotton-
producing state of the number of vacancies to be filled by cotton 
producers on the Cotton Board; and
    (2) Based on the average annual volume of imports of cotton and the 
cotton content of cotton-containing products on which assessments as 
provided for in Sec. 1205.335 have been collected in terms of 480-pound 
net weight bales for the five most recent calendar years, notify all 
certified cotton importer organizations of the number of vacancies to be 
filled by cotton importers on the Cotton Board.

[56 FR 65980, Dec. 20, 1991]



Sec. 1205.403  Nomination procedure.

    (a) The Director shall notify all certified producer organizations 
within each cotton-producing state and all certified importer 
organizations of the location, date, and time of the caucus for 
nominating producer and importer representatives for the Cotton Board as 
specified in Sec. 1205.324. The Director will designate a 
representative from the Cotton Division to attend the caucus meeting of 
cotton producer organizations in each state, and of cotton importer 
organizations. Each eligible cotton producer organization within each 
cotton-producing state and each importer organization will be entitled 
to only one representative at the caucus for the purpose of nominating 
two qualified persons for each member and for each alternate member to 
be selected. The representative of a cotton producer organization shall 
be a cotton

[[Page 31]]

producer and resident of such state, an officer or member of the Board 
of Directors of such organization, and duly and unqualifiedly authorized 
in writing by such organization to make nominations on its behalf. The 
representative of an importer organization shall be an importer of 
cotton and/or products containing cotton, an officer or member of the 
Board of Directors of such organization, and duly and unqualifiedly 
authorized in writing by such organization to make nominations on its 
behalf. The representative of the Director designated to attend the 
caucus meeting of cotton producer organizations in each state and of 
cotton importer organizations will ascertain the qualifications and 
eligibility of each representative of a cotton producer organization or 
cotton importer organization to participate in said meeting and to make 
nominations.
    (b) Each caucus will be conducted as follows:
    (1) The representative from the Cotton Division will act as 
temporary chairperson and will explain the procedure for nominations and 
the duties of the Cotton Board;
    (2) The representatives in attendance from the certified 
organizations will then select a chairperson and secretary;
    (3) At each caucus there will be presented for nomination and there 
will be nominated not less than the number of nominees required under 
the provisions of Sec. Sec. 1205.322, 1205.324, and 1205.402.

[56 FR 65981, Dec. 20, 1991]



               Subpart_Cotton Board Rules and Regulations

    Source: 42 FR 35974, July 13, 1977, unless otherwise noted.

                               Definitions



Sec. 1205.500  Terms defined.

    As used throughout this subpart, unless the context otherwise 
requires, the following terms shall mean:
    (a) ASCS means the Agricultural Stabilization and Conservation 
Service of the U.S. Department of Agriculture.
    (b) Cotton Board means the administrative body established pursuant 
to the Cotton Research and Promotion Order.
    (c) CCC means the Commodity Credit Corporation.
    (d) Current value of Cotton means the gross price per pound of lint 
cotton received by the producer for cotton as shown on the producers' 
settlement document before deductions are made for weight penalties, 
buyer's commission or brokerage fees, marketing fees, the $1 per bale 
cotton research and promotion assessment, picking charges, ginning 
charges, warehouse receiving charges, warehouse storage charges, 
transportation charges or any other charges, plus any amount received by 
a producer in the form of a loan deficiency payment with respect to such 
cotton.
    (e) Form A means Cotton Producer's Note, Form CCC Cotton A.
    (f) Gin code number means the identification number assigned to each 
cotton gin by the Cotton Division, Agricultural Marketing Service, U.S. 
Department of Agriculture.
    (g) Handle means to harvest, gin, warehouse, compress, purchase, 
market, transport, or otherwise acquire ownership or control of cotton.
    (h) Handler means any person who handles cotton, including CCC.
    (i) Marketing means any sale of cotton, or the pledging of cotton to 
CCC as collateral for a price support loan.
    (j) Marketing year means a consecutive 12-month period ending on 
July 31.
    (k) Person means any individual, partnership, corporation, 
association, or any other entity, whether governmental or private.
    (l) Producer means any person who owns or shares in a cotton crop 
(or in the proceeds thereof) as landowner, landlord, tenant, or 
sharecropper.
    (m) Secretary means the Secretary of Agriculture of the United 
States, or any officer or employee of the U.S. Department of Agriculture 
to whom authority has heretofore been delegated, or to whom authority 
may hereafter be delegated, to act in the Secretary's stead.
    (n) Loan deficiency payment means any payment on Upland cotton made 
by the Commodity Credit Corporation to a producer in accordance with 7 
CFR 713.55.

[[Page 32]]

    (o) Importer means any person who enters, or withdraws from 
warehouse, cotton for consumption in the customs territory of the United 
States and import means any such entry.
    (p) Customs Service means the United States Customs Service of the 
United States Department of Treasury.
    (q) Cotton means:
    (1) All Upland cotton harvested in the United States, and, except as 
used in section 7(e) of the Act, includes cottonseed of such cotton and 
the products derived from such cotton and its seed, and
    (2) Imports of Upland cotton, including the Upland cotton content of 
the products derived thereof. The term cotton shall not, however, 
include:
    (i) Any entry of imported cotton by an importer which has a value or 
weight less than a de minimis amount established in regulations issued 
by the Secretary and
    (ii) Industrial products as that term is defined by regulation.
    (r) Industrial products means cotton-containing products which are 
classified in the Harmonized Tariff Schedule of the United States under 
classifications other than textile classifications. Certain cotton-
containing textile products under textile classifications shall also be 
considered to be industrial products, and are therefore not included in 
the table appearing in these regulations as products subject to 
assessment. Such products include, but are not limited to textile 
fabrics coated, impregnated, covered, or laminated, with other 
materials, textile piping and tubing, and belting materials.

[42 FR 35974, July 13, 1977, as amended at 50 FR 10932, Mar. 19, 1985; 
51 FR 6098, Feb. 20, 1986; 51 FR 37705, Oct. 24, 1986; 57 FR 29185, July 
1, 1992]

                                 General



Sec. 1205.505  Communication.

    All reports, requests, applications for reimbursements, and 
communications in connection with the Cotton Research and Promotion 
Order shall be addressed as follows: Cotton Board, Post Office Box 2121, 
Memphis, Tennessee, 38101-2121.

[57 FR 29186, July 1, 1992]

                               Assessments



Sec. 1205.510  Levy of assessments.

    (a) Producer assessments. An assessment of $1 per bale for cotton 
research and promotion is hereby levied on each bale of Upland cotton 
that is produced from cotton harvested and ginned except cotton consumed 
by any governmental agency from its own production. Such assessment 
shall be payable and collected only once on each bale.
    (1) A supplemental assessment for cotton research and promotion in 
addition to the $1 per bale assessment provided for in paragraph (a) of 
this section, is hereby levied on each bale of Upland cotton harvested 
and ginned except cotton consumed by any governmental agency from its 
own production. The supplemental assessment rate shall be levied at the 
rate of five-tenths of one percent of:
    (i) The current value of the cotton multiplied by the number of 
pounds of lint cotton or;
    (ii) The current value of the cotton converted to a fixed amount per 
bale as reflected in the following assessment chart:

                          Assessment Chart \1\
------------------------------------------------------------------------
                                                            Supplemental
                                                             Assessment,
              Current value (cents per pound)                dollars per
                                                                bale
------------------------------------------------------------------------
.00 to 9.99...............................................          0.15
10.00 to 19.99............................................           .40
20.00 to 29.99............................................           .65
30.00 to 39.99............................................           .90
40.00 to 49.99............................................          1.15
50.00 to 59.99............................................          1.40
60.00 to 69.99............................................          1.65
70.00 to 79.99............................................          1.90
80.00 to 89.99............................................          2.15
90.00 to 99.99............................................          2.40
100.00 to 109.99..........................................          2.65
110.00 to 119.99..........................................         2.90
------------------------------------------------------------------------
\1\ Assessment is calculated on \5/10\ of 1 percent of the midpoint of
  each 10[cent] increment, based on a 500 lb. bale and converted to a
  fixed amount per bale.

    (2) Each marketing year the collecting handler must select one of 
the two options for collecting the supplemental assessment as provided 
in paragraph (a)(1) of this section. The handler shall notify the Cotton 
Board as to the method selected at the time the handler files the first 
handler report each marketing year.

[[Page 33]]

    (b) Importer assessment. An assessment for cotton research and 
promotion of $1 per bale is hereby levied on each bale of cotton, or the 
bale equivalent thereof for cotton in cotton-containing products 
identified in the HTS conversion factor table in paragraph (b)(3) of 
this section and imported into the United States on or after July 31, 
1992. The $1 per bale assessment shall be converted to a fixed amount 
per kilogram to facilitate the U.S. Customs Service in collecting this 
assessment.
    (1) A supplemental assessment for cotton research and promotion in 
addition to the $1 per bale assessment provided for in paragraph (b) of 
this section is hereby levied on each bale of cotton or bale equivalent 
of cotton in cotton-containing products, identified in this subpart, 
imported into the United States on or after July 31, 1992. The 
supplemental assessment shall be levied at the rate of five-tenths of 
one percent of the historical value of cotton as determined by the 
Secretary and expressed in paragraph (b)(2) of this section. The rate of 
the supplemental assessment on imported cotton will be the same as that 
levied on cotton produced within the United States. The supplemental 
assessment will be calculated as a fixed amount per kilogram and added 
to the $1 per bale or bale equivalent assessment to facilitate the 
Customs Service in collecting assessments.
    (2) The 12-month average of monthly weighted average prices received 
by U.S. farmers will be calculated annually. Such weighted average will 
be used as the value of imported cotton for the purpose of levying the 
supplemental assessment on imported cotton and will be expressed in 
kilograms. The value of imported cotton for the purpose of levying this 
supplemental assessment is $0.8267 per kilogram.
    (3) The following table contains Harmonized Tariff Schedule (HTS) 
classification numbers and corresponding conversion factors and 
assessments. The left column of the following table indicates the HTS 
classifications of imported cotton and cotton-containing products 
subject to assessment. The center column indicates the conversion factor 
for determining the raw fiber content for each kilogram of the HTS. HTS 
numbers for raw cotton have no conversion factor in the table. The right 
column indicates the total assessment per kilogram of the article 
assessed.
    (i) Any line item entry of cotton appearing on Customs entry 
documentation in which the value of the cotton contained therein results 
in the calculation of an assessment of two dollars ($2.00) or less will 
not be subject to assessments as described in this section.
    (ii) In the event that any HTS number subject to assessment is 
changed and such change is merely a replacement of a previous number and 
has no impact on the physical properties, description, or cotton content 
of the product involved, assessments will continue to be collected based 
on the new number.

                         Import Assessment Table
                           [Raw Cotton Fiber]
------------------------------------------------------------------------
        HTS No.                Conv. fact.               Cents/kg.
------------------------------------------------------------------------
        5201000500                        0                  0.8267
        5201001200                        0                  0.8267
        5201001400                        0                  0.8267
        5201001800                        0                  0.8267
        5201002200                        0                  0.8267
        5201002400                        0                  0.8267
        5201002800                        0                  0.8267
        5201003400                        0                  0.8267
        5201003800                        0                  0.8267
        5204110000                   1.1111                  0.9185
        5204200000                   1.1111                  0.9185
        5205111000                   1.1111                  0.9185
        5205112000                   1.1111                  0.9185
        5205121000                   1.1111                  0.9185
        5205122000                   1.1111                  0.9185
        5205131000                   1.1111                  0.9185
        5205132000                   1.1111                  0.9185
        5205141000                   1.1111                  0.9185
        5205210020                   1.1111                  0.9185
        5205210090                   1.1111                  0.9185
        5205220020                   1.1111                  0.9185
        5205220090                   1.1111                  0.9185
        5205230020                   1.1111                  0.9185
        5205230090                   1.1111                  0.9185
        5205240020                   1.1111                  0.9185
        5205240090                   1.1111                  0.9185
        5205310000                   1.1111                  0.9185
        5205320000                   1.1111                  0.9185
        5205330000                   1.1111                  0.9185
        5205340000                   1.1111                  0.9185
        5205410020                   1.1111                  0.9185
        5205410090                   1.1111                  0.9185
        5205420020                   1.1111                  0.9185
        5205420090                   1.1111                  0.9185
        5205440020                   1.1111                  0.9185
        5205440090                   1.1111                  0.9185
        5206120000                   0.5556                  0.4593
        5206130000                   0.5556                  0.4593
        5206140000                   0.5556                  0.4593
        5206220000                   0.5556                  0.4593

[[Page 34]]

 
        5206230000                   0.5556                  0.4593
        5206240000                   0.5556                  0.4593
        5206310000                   0.5556                  0.4593
        5207100000                   1.1111                  0.9185
        5207900000                   0.5556                  0.4593
        5208112020                   1.1455                  0.9470
        5208112040                   1.1455                  0.9470
        5208112090                   1.1455                  0.9470
        5208114020                   1.1455                  0.9470
        5208114060                   1.1455                  0.9470
        5208114090                   1.1455                  0.9470
        5208118090                   1.1455                  0.9470
        5208124020                   1.1455                  0.9470
        5208124040                   1.1455                  0.9470
        5208124090                   1.1455                  0.9470
        5208126020                   1.1455                  0.9470
        5208126040                   1.1455                  0.9470
        5208126060                   1.1455                  0.9470
        5208126090                   1.1455                  0.9470
        5208128020                   1.1455                  0.9470
        5208128090                   1.1455                  0.9470
        5208130000                   1.1455                  0.9470
        5208192020                   1.1455                  0.9470
        5208192090                   1.1455                  0.9470
        5208194020                   1.1455                  0.9470
        5208194090                   1.1455                  0.9470
        5208196020                   1.1455                  0.9470
        5208196090                   1.1455                  0.9470
        5208224040                   1.1455                  0.9470
        5208224090                   1.1455                  0.9470
        5208226020                   1.1455                  0.9470
        5208226060                   1.1455                  0.9470
        5208228020                   1.1455                  0.9470
        5208230000                   1.1455                  0.9470
        5208292020                   1.1455                  0.9470
        5208292090                   1.1455                  0.9470
        5208294090                   1.1455                  0.9470
        5208296090                   1.1455                  0.9470
        5208298020                   1.1455                  0.9470
        5208312000                   1.1455                  0.9470
        5208321000                   1.1455                  0.9470
        5208323020                   1.1455                  0.9470
        5208323040                   1.1455                  0.9470
        5208323090                   1.1455                  0.9470
        5208324020                   1.1455                  0.9470
        5208324040                   1.1455                  0.9470
        5208325020                   1.1455                  0.9470
        5208330000                   1.1455                  0.9470
        5208392020                   1.1455                  0.9470
        5208392090                   1.1455                  0.9470
        5208394090                   1.1455                  0.9470
        5208396090                   1.1455                  0.9470
        5208398020                   1.1455                  0.9470
        5208412000                   1.1455                  0.9470
        5208416000                   1.1455                  0.9470
        5208418000                   1.1455                  0.9470
        5208421000                   1.1455                  0.9470
        5208423000                   1.1455                  0.9470
        5208424000                   1.1455                  0.9470
        5208425000                   1.1455                  0.9470
        5208430000                   1.1455                  0.9470
        5208492000                   1.1455                  0.9470
        5208494020                   1.1455                  0.9470
        5208494090                   1.1455                  0.9470
        5208496010                   1.1455                  0.9470
        5208496090                   1.1455                  0.9470
        5208498090                   1.1455                  0.9470
        5208512000                   1.1455                  0.9470
        5208516060                   1.1455                  0.9470
        5208518090                   1.1455                  0.9470
        5208523020                   1.1455                  0.9470
        5208523045                   1.1455                  0.9470
        5208523090                   1.1455                  0.9470
        5208524020                   1.1455                  0.9470
        5208524045                   1.1455                  0.9470
        5208524065                   1.1455                  0.9470
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[[Page 35]]

 
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[[Page 36]]

 
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[[Page 37]]

 
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        6209201000                   1.1577                  0.9571
        6209203000                   0.9749                  0.8059
        6209205030                   0.9749                  0.8059
        6209205035                   0.9749                  0.8059
        6209205040                   1.2186                  1.0074
        6209205045                   0.9749                  0.8059
        6209205050                   0.9749                  0.8059
        6209303020                   0.2463                  0.2036
        6209303040                   0.2463                  0.2036
        6210109010                   0.2291                  0.1894
        6210403000                   0.0391                  0.0323
        6210405020                   0.4556                  0.3766
        6211111010                   0.1273                  0.1052
        6211111020                   0.1273                  0.1052

[[Page 38]]

 
        6211118010                   1.1455                  0.9470
        6211118020                   1.1455                  0.9470
        6211320007                   0.8461                  0.6995
        6211320010                   1.0413                  0.8608
        6211320015                   1.0413                  0.8608
        6211320030                   0.9763                  0.8071
        6211320060                   0.9763                  0.8071
        6211320070                   0.9763                  0.8071
        6211330010                   0.3254                  0.2690
        6211330030                   0.3905                  0.3228
        6211330035                   0.3905                  0.3228
        6211330040                   0.3905                  0.3228
        6211420010                   1.0413                  0.8608
        6211420020                   1.0413                  0.8608
        6211420025                   1.1715                  0.9685
        6211420060                   1.0413                  0.8608
        6211420070                   1.1715                  0.9685
        6211430010                   0.2603                  0.2152
        6211430030                   0.2603                  0.2152
        6211430040                   0.2603                  0.2152
        6211430050                   0.2603                  0.2152
        6211430060                   0.2603                  0.2152
        6211430066                   0.2603                  0.2152
        6212105020                   0.2412                  0.1994
        6212109010                   0.9646                  0.7974
        6212109020                   0.2412                  0.1994
        6212200020                   0.3014                  0.2492
        6212900030                   0.1929                  0.1595
        6213201000                   1.1809                  0.9763
        6213202000                   1.0628                  0.8786
        6213901000                   0.4724                  0.3905
        6214900010                   0.9043                  0.7476
        6216000800                   0.2351                  0.1944
        6216001720                   0.6752                  0.5582
        6216003800                   1.2058                  0.9968
        6216004100                   1.2058                  0.9968
        6217109510                   1.0182                  0.8417
        6217109530                   0.2546                  0.2105
        6301300010                   0.8766                  0.7247
        6301300020                   0.8766                  0.7247
        6302100005                   1.1689                  0.9663
        6302100008                   1.1689                  0.9663
        6302100015                   1.1689                  0.9663
        6302215010                   0.8182                  0.6764
        6302215020                   0.8182                  0.6764
        6302217010                   1.1689                  0.9663
        6302217020                   1.1689                  0.9663
        6302217050                   1.1689                  0.9663
        6302219010                   0.8182                  0.6764
        6302219020                   0.8182                  0.6764
        6302219050                   0.8182                  0.6764
        6302222010                   0.4091                  0.3382
        6302222020                   0.4091                  0.3382
        6302313010                   0.8182                  0.6764
        6302313050                   1.1689                  0.9663
        6302315050                   0.8182                  0.6764
        6302317010                   1.1689                  0.9663
        6302317020                   1.1689                  0.9663
        6302317040                   1.1689                  0.9663
        6302317050                   1.1689                  0.9663
        6302319010                   0.8182                  0.6764
        6302319040                   0.8182                  0.6764
        6302319050                   0.8182                  0.6764
        6302322020                   0.4091                  0.3382
        6302322040                   0.4091                  0.3382
        6302402010                   0.9935                  0.8213
        6302511000                   0.5844                  0.4831
        6302512000                   0.8766                  0.7247
        6302513000                   0.5844                  0.4831
        6302514000                   0.8182                  0.6764
        6302600010                   1.1689                  0.9663
        6302600020                    1.052                  0.8697
        6302600030                    1.052                  0.8697
        6302910005                    1.052                  0.8697
        6302910015                   1.1689                  0.9663
        6302910025                    1.052                  0.8697
        6302910035                    1.052                  0.8697
        6302910045                    1.052                  0.8697
        6302910050                    1.052                  0.8697
        6302910060                    1.052                  0.8697
        6303110000                   0.9448                  0.7811
        6303910010                   0.6429                  0.5315
        6303910020                   0.6429                  0.5315
        6304111000                   1.0629                  0.8787
        6304190500                    1.052                  0.8697
        6304191000                   1.1689                  0.9663
        6304191500                   0.4091                  0.3382
        6304192000                   0.4091                  0.3382
        6304910020                   0.9351                  0.7730
        6304920000                   0.9351                  0.7730
        6505901540                    0.181                  0.1496
        6505902060                   0.9935                  0.8213
        6505902545                   0.5844                  0.4831
------------------------------------------------------------------------

    (4) Any entry of cotton that qualifies for informal entry according 
to regulations issued by the Customs Service will not be subject to the 
assessment.
    (5) Imported textile and apparel articles assembled of components 
formed from cotton produced in the Unites States and identified by HTS 
numbers 9819.11.03, 9819.11.06, 9820.11.03, 9820.11.06, 9820.11.09, 
9820.11.12, 9820.11.18, 9820.11.21, 9802.00.8015, 9802.00.9000, 
9802.00.8044, or 9802.00.8046 shall not subject to assessment.
    (6) Imported cotton and products may be exempted by the Cotton Board 
from assessment under this paragraph. Such imported cotton and products 
may include, but are not limited to cotton and the cotton content of 
products which is U.S. produced cotton, or cotton other than Upland 
cotton.
    (i) A request for such exemption must be submitted to the Cotton 
Board by the importer, prior to the importation of the cotton product. 
The Cotton Board will then issue, if deemed appropriate, a numbered 
exemption certificate valid for 1 year from the date of issue. The 
exemption number should be entered by the importer on the Customs entry 
documentation in the appropriate location as determined by the U.S. 
Customs Service.
    (ii) The request for exemption should include:
    (A) the name, address, and importer identification number for the 
importer;

[[Page 39]]

    (B) the HTS classification of the imported product;
    (C) weight of the product for which the exemption is sought;
    (D) estimated date of entry;
    (E) commercial invoices of other such documentation indicating the 
origin or production or type of the cotton fiber used to produce the 
imported product;
    (F) manufacture's description of the imported product.
    (7) The exemption number ``999999999'' shall be entered on the 
Customs entry summary document, in the appropriate location as 
determined by the U.S. Customs Service, by the importer when, based on 
the importer's own determination, the imported product is identified by 
a Harmonized Tariff Schedule classification number which is subject to 
assessment but the particular article contains no cotton.
    (8) Articles imported into the United States temporarily and under 
bond which are classified by the Harmonized Tariff Schedule heading 
which begins with ``9813'' shall not be subject to assessment.
    (9) Articles imported into the U.S. after being exported from the 
U.S. for alterations and which are classified by the Harmonized Tariff 
Schedule subheadings 9802.00.40 and 9802.00.50 shall not be subject to 
assessment.

[57 FR 29432, July 2, 1992, as amended at 58 FR 52216, Oct. 7, 1993; 59 
FR 59111, Nov. 16, 1994; 60 FR 36034, July 13, 1995; 61 FR 31819, 31822, 
June 21, 1996; 62 FR 22878, Apr. 28, 1997; 62 FR 46414, Sept. 2, 1997; 
62 FR 50244, Sept. 25, 1997; 63 FR 27819, May 21, 1998; 64 FR 30238, 
June 7, 1999; 65 FR 25237, May 1, 2000; 65 FR 70644, Nov. 27, 2000; 66 
FR 58052, Nov. 20, 2001; 67 FR 36795, May 28, 2002; 68 FR 27900, May 22, 
2003]



Sec. 1205.511  Payment and collection.

    (a) The $1 per bale assessment shall be paid by:
    (1) The producer of the cotton to the collecting handler designated 
in Sec. 1205.512, and
    (2) The importer of cotton to the Customs Service as provided in 
Sec. 1205.514.
    (b) The supplemental assessment shall be paid by:
    (1) The producer of the cotton to the collecting handler designated 
in Sec. 1205.513, and
    (2) The importer of cotton to the Customs Service as described in 
Sec. 1205.515.
    (c) If more than one person subject to assessment shares in the 
proceeds received from a bale or bale equivalent, each such person is 
obligated to pay that portion of the assessment that is equivalent to 
that person's proportionate share of the proceeds.
    (d) Failure of the handler to collect the assessments on each bale 
shall not relieve the handler of the handler's obligation to remit the 
assessments to the Cotton Board as required in Sec. Sec. 1205.512, 
1205.513 and 1205.516.

[57 FR 29190, July 1, 1992]



Sec. 1205.512  Collecting handlers and time of collection of $1 per 
bale assessment.

    Collecting handlers and the time of collecting the $1 per bale 
assessment shall be as follows:
    (a) Except as provided in paragraph (b) of this section, any person 
who purchases a bale of cotton from the producer of the cotton shall be 
the collecting handler for such cotton. The handler shall collect the 
assessment at the time the handler first makes any payment or any credit 
to the producer's account for the cotton. The handler shall give the 
producer a receipt indicating payment of the assessment.
    (b) Any cooperative marketing association or other person that 
accepts a bale of cotton from the producer of the cotton under an oral 
or written contract or agreement providing for the marketing of the 
cotton shall be the collecting handler for such cotton. Such association 
or person shall collect the assessment regardless of whether the cotton 
is marketed or tendered to CCC for price support loan. The handler shall 
collect the assessment at the time the handler first makes any cash 
advance, any payment, or any credit to the producer's account for the 
cotton. The handler shall give the producer a receipt indicating payment 
of the assessment.
    (c) For bales of cotton tendered to CCC for Form A loan, except 
bales tendered pursuant to paragraph (b) of this section:

[[Page 40]]

    (1) The ASCS County Office shall be the collecting handler except as 
provided in paragraph (c)(2) of this section. The ASCS County Office 
shall collect the assessment when it makes disbursement based on the 
Form A loan documents. The producer's copy of the Cotton Producer's Note 
(Form CCC Cotton A) shall show payment of the assessment and shall 
constitute the producer's receipt for payment of the assessment.
    (2) Any person (other than an ASCS County Office) who advances to 
the producer the loan value of the cotton as shown on a Cotton 
Producer's Note (Form CCC Cotton A) shall be the collecting handler for 
such cotton. The handler shall collect the $1 per bale assessment at the 
time the handler makes any advance to the producer on the loan value of 
the cotton. The handler shall give the producer a receipt indicating 
payment of the assessment.
    (d) Any person who purchases cotton in the cotton field where 
produced or who purchases seed cotton or unbaled lint cotton from the 
producer of the cotton shall be the collecting handler. The handler 
shall collect the assessment at the time such cotton is ginned and shall 
give the producer a receipt indicating payment of the assessment. When a 
bale is ginned that contains any such cotton purchased from more than 
one producer, the handler shall collect each producer's proportionate 
share of the assessment and shall give each producer a receipt 
indicating the producer's proportionate share of the assessment payment.
    (e) Any person who purchases cotton from a producer whereby the 
producer agrees to deliver a certain quantity of cotton but retains the 
right to establish the price at some future date shall be the collecting 
handler for such cotton. The handler shall collect the $1 per bale 
assessment at the time final settlement is made on the cotton. The 
handler shall give the producer a receipt indicating payment of the $1 
per bale assessment.
    (f) Any person who consumes domestically or exports cotton of that 
person's own production shall be the collecting handler for such cotton. 
Such handler shall pay the assessment to the Cotton Board at the time 
the cotton is consumed or exported.
    (g) Any person who obtains ownership of a bale of cotton from the 
producer of the cotton by transfer of any kind or by any means, under 
conditions other than those described in paragraph (a), (b), (c), (d) or 
(e) of this section shall be the collecting handler for such cotton. 
Such handler shall collect the assessment at the time such handler takes 
ownership of the cotton. The handler shall give the producer a receipt 
indicating payment of the assessment.
    (h) In the event of a producer's death, bankruptcy, receivership, or 
incapacity to act, the representative of such producer, or the 
producer's estate, or the person acting on behalf of creditors, shall be 
considered the producer for the purposes of this section.

[42 FR 35974, July 31, 1977, as amended at 50 FR 10932, Mar. 19, 1985; 
57 FR 29190, July 1, 1992]



Sec. 1205.513  Collecting handlers and time of collection of the 
supplemental assessment.

    Collecting handlers and the time of collecting the supplemental 
assessment shall be as follows:
    (a) Except as provided in paragraph (b) of this section, any person 
who purchases a bale of cotton from the producer of the cotton shall be 
the collecting handler for such cotton. The handler shall collect the 
supplemental assessment at the time the handler first makes any payment 
or any credit to the producer's account for the cotton. The handler 
shall give the producer a receipt indicating payment of the supplemental 
assessment.
    (b) Any cooperative marketing association or other person that 
accepts a bale of cotton from the producer of the cotton under an oral 
or written contract or agreement providing for the marketing of the 
cotton shall be the collecting handler for such cotton. Such association 
or person shall collect the supplemental assessment regardless of 
whether the cotton is marketed or tendered to CCC for price support 
loan. The handler shall collect the supplemental assessment at the time 
the handler first makes any cash advance,

[[Page 41]]

any payment, or any credit to the producer's account for the cotton. 
Supplemental assessments due on any subsequent cash advances, payments, 
or credits to the producer's account shall be collected by the handler 
at the time final settlement is made on the cotton. The handler shall 
give the producer a receipt each time a supplemental assessment is 
collected.
    (c) For bales of cotton tendered to CCC for Form A loan, except 
bales tendered pursuant to paragraph (b) of this section:
    (1) The ASCS County Office shall be the collecting handler except as 
provided in paragraph (c)(2) of this section. The ASCS County Office 
shall collect the supplemental assessment when it makes disbursement 
based on the Form A loan value of cotton. The producer's copy of the 
Cotton Producer's Note (Form CCC Cotton A) shall show payment of the 
supplemental assessment and shall constitute the producer's receipt for 
payment of the supplemental assessment.
    (2) Any person (other than an ASCS County Office) who advances to 
the producer the loan value of the cotton as shown on a Cotton 
Producer's Note (Form CCC Cotton A) shall be the collecting handler for 
such cotton. The handler shall collect the supplemental assessment at 
the time the handler makes any advance to the producer on the loan value 
of the cotton. The handler shall give the producer a receipt indicating 
payment of the supplemental assessment.
    (d) With respect to any Upland cotton on which the producer or a 
cooperative marketing association acting on behalf of a producer 
receives a loan deficiency payment, the ASCS County Office or the 
cooperative marketing association shall be the collecting handler of the 
supplemental assessment on the value of the cotton represented by the 
loan deficiency payment at the time such payment is made to the producer 
or the cooperative marketing association. A copy of a document 
reflecting this transaction issued by the ASCS County Office or 
cooperative marketing association shall show the amount collected as the 
supplemental assessment and shall constitute the producer's receipt for 
payment of the supplemental assessment.
    (e) Any person who (1) purchases a producer's equity in cotton 
tendered to CCC for Form A loan or (2) purchases cotton that a producer 
has redeemed from the Form A loan, shall be the collecting handler for 
the portion of the total supplemental assessment not collected under 
paragraph (c) of this section. The handler shall give the producer a 
receipt indicating payment of that portion of the supplemental 
assessment.
    (f) Any person who purchases cotton in the cotton field where 
produced or who purchases seed cotton or unbaled lint cotton from the 
producer of the cotton shall be the collecting handler. The handler 
shall collect the supplemental assessment at the time such cotton is 
ginned and shall give the producer a receipt indicating payment of the 
supplemental assessment. When a bale is ginned and baled that contains 
any such cotton purchased from more than one producer, the handler shall 
collect each producer's proportionate share of the supplemental 
assessment and shall give each producer a receipt indicating the 
producer's proportionate share of the supplemental assessment payment.
    (g) Any person who purchases cotton from a producer whereby the 
producer agrees to deliver a certain quantity of cotton but retains the 
right to establish the price at some future date shall be the collecting 
handler for such cotton. The handler shall collect the supplemental 
assessment at the time final settlement is made on the cotton. The 
handler shall give the producer a receipt indicating payment of the 
supplemental assessment.
    (h) Any person who consumes domestically cotton of that person's own 
production shall be the collecting handler for such cotton. The handler 
shall pay the supplemental assessment at the time of consumption on the 
basis of a market value determined in consultation with the Cotton 
Board.
    (i) Any person who exports cotton of that person's own production 
shall be the collecting handler for such cotton. Such handler shall pay 
the supplemental assessment on the basis of the

[[Page 42]]

current value of cotton as reflected on the export settlement document.
    (j) Any person who obtains ownership of a bale of cotton from the 
producer of the cotton by transfer of any kind or by any means, under 
conditions other than those described in paragraph (a), (b), (c), (d), 
(e), or (f) of this section shall be the collecting handler for such 
cotton. Such handler shall collect the supplemental assessment at the 
time the handler takes ownership of the cotton. The handler shall give 
the producer a receipt indicating payment of the supplemental 
assessment.
    (k) In the event of a producer's death, bankruptcy, receivership, or 
incapacity to act, the representative of such producer or the producer's 
estate, or the person acting on behalf of creditors, shall be considered 
the producer for the purposes of this section.

[42 FR 35974, July 31, 1977, as amended at 50 FR 10932, Mar. 19, 1985; 
51 FR 37705, Oct. 24, 1986; 57 FR 29190, July 1, 1992]



Sec. 1205.514  Customs Service and the Collection of the $1 per bale 
assessment.

    The Collection of the $1 per bale assessment by the Customs Service 
shall be as follows:
    (a) The Customs Service will collect the assessment from the 
importer or from any person acting as principal, agent, broker or 
consignee for cotton or cotton-containing products produced outside the 
United States and imported into the United States. The Customs Service 
will collect the assessment on cotton and cotton-containing products 
identified by Harmonized Tariff Schedule heading numbers in Sec. 
1205.510(b)(2) at the time of importation and forward such assessment as 
per the agreement between the United States Customs Service and the U.S. 
Department of Agriculture.
    (b) In the event of an importer's death, bankruptcy, receivership, 
or incapacity to act, the representative of such importer, or the 
importer's estate, or the person acting on behalf of creditors, shall be 
considered the importer for the purposes of this section.

[57 FR 29191, July 1, 1992]



Sec. 1205.515  Customs Service and the collection of the supplemental 
assessment.

    The collection of the supplemental assessment by the Customs Service 
shall be as follows:
    (a) The Customs Service will collect the supplemental assessment 
from any person acting as principal, agent, broker or consignee for 
cotton or cotton-containing products produced outside the United States 
and imported into the United States. Customs Service will collect the 
assessment on all cotton and cotton-containing products identified by 
Harmonized Tariff Schedule heading numbers in Sec. 1205.510(b)(2) at 
the time of importation and forward such assessment as per the agreement 
between the United States Customs Service and the U.S. Department of 
Agriculture.
    (b) In the event of an importer's death, bankruptcy, receivership, 
or incapacity to act, the representative of such importer, or the 
importer's estate, or the person acting on behalf of creditors, shall be 
considered the importer for the purposes of this section.

[57 FR 29191, July 1, 1992]



Sec. 1205.516  Reports and remittance to the Cotton Board.

    (a) Handler reports and remittances. Each collecting handler shall 
transmit assessments to the Cotton Board as follows:
    (1) Reporting periods. Each calendar month shall be a reporting 
period and the period shall end on the close of business on the last day 
of the month.
    (2) Reports. Each collecting handler shall make reports on forms 
made available or approved by the Cotton Board. Each report shall be 
mailed to the Cotton Board and postmarked within ten days after the 
close of the reporting period.
    (i) Collecting handler report. Each collecting handler shall prepare 
a separate report form each reporting period for each gin from which 
such handler handles cotton on which the handler is required to collect 
the assessments during the reporting period. Each report shall be mailed 
in duplicate to the Cotton Board and shall contain the following 
information:
    (A) Date of report;

[[Page 43]]

    (B) Reporting period covered by report;
    (C) Gin code number;
    (D) Name and address of handler;
    (E) Listing of all producers from whom the handler was required to 
collect the assessments, their addresses, total number of bales, and 
total assessment collected and remitted for each producer;
    (F) Date of last report remitting assessments to the Cotton Board.
    (ii) No cotton purchased report. Each collecting handler shall 
submit a no cotton purchased report form for each reporting period in 
which no cotton was handled for which the handler is required to collect 
assessments during the reporting period. A collecting handler who 
handles cotton only during certain months shall file a final no cotton 
purchased report at the conclusion of such handlers marketing season. If 
a collecting handler handles cotton during any month following 
submission of the final report for the handlers marketing season, such 
handler shall send a collecting handler report and remittance to the 
Cotton Board by the 10th day of the month following the month in which 
cotton was handled. The no cotton purchased report shall be signed and 
dated by the handler of the handler's agent.
    (3) Remittances. The collecting handler shall remit all assessments 
to the Cotton Board with the report required in paragraph (a)(2) of this 
section. All remittances sent to the Cotton Board by collecting handlers 
shall be made by check, draft, or money order payable to the order of 
the ``Cotton Board''. All remittances shall be received subject to 
collection and payment at par.
    (4) Interest and late payment charges. (i) There shall be an 
interest charge, at rates prescribed by the Cotton Board with the 
approval of the Secretary, on any handler who is sent a second certified 
mail notice of past-due assessments from the Cotton Board in any one 
marketing year (August 1-July 31).
    (ii) In addition to the interest charge specified in paragraph 
(a)(4)(i) of this section, there shall be a late payment charge on any 
handler whose remittance is not received by the Cotton Board within 10 
days after the close of the reporting period in which interest charges 
were first accrued. The late payment charge shall be 5 percent of the 
unpaid balance before interest charges have accrued.
    (iii) The interest and late payment charges on the unremitted 
assessments for a particular reporting period will be applied from the 
first working day on or following the 20th day of the month in which the 
assessments were due.
    (b) Importer reports and remittance. The United States Customs 
Service will transmit reports and assessments collected on imported 
cotton to the Agricultural Marketing Service according to the agreement 
between the Customs Service and the Agricultural Marketing Service. Upon 
the request of the Cotton Board, an importer shall file with the Board a 
report, for a period of time specified in the request, that includes the 
following information:
    (1) The importer's name and address;
    (2) The quantity of cotton and cotton products imported;
    (3) The amount of the assessment paid on imported cotton and cotton 
products;
    (4) The amount of imported cotton and cotton products on which the 
assessment was not paid to the Customs Service.

[57 FR 29190, July 1, 1992]



Sec. 1205.517  Failure to report and remit.

    (a) Any collecting handler who fails to submit reports and 
remittances according to reporting periods and time schedules required 
in Sec. 1205.516 shall be subject to appropriate action by the Cotton 
Board which may include one or more of the following actions:
    (1) Audits of the collecting handler's books and records to 
determine the amount owed the Cotton Board;
    (2) Requirement that an escrow account for the deposit of 
assessments collected be established. Frequency and schedule of deposits 
and withdrawals from the escrow account shall be determined by the 
Cotton Board with the Approval of the Secretary;
    (3) Referral to the Secretary for appropriate enforcement action;
    (4) Publication of a collecting handler's name in accordance with 
the following provisions:

[[Page 44]]

    (i) The name of any collecting handler will be subject to 
publication if the collecting handler:
    (A) is sent two certified mail notices of past due assessments and/
or collecting handler reports from the Cotton Board in any one marketing 
year (August 1-July 31), or
    (B) is required by the Cotton Board to establish an escrow account 
for depositing assessments, in accordance with paragraph (a)(2) of this 
section, and does not comply with the deposit procedures established by 
the Cotton Board with approval of the Secretary.
    (ii) The name of any collecting handler who is subject to 
publication will be published by the Cotton Board with the approval of 
the Secretary in a monthly listing during the primary cotton marketing 
season (September through March) and a bi-monthly listing during the 
remainder of the year. The published listing will be distributed by the 
Cotton Board.
    (iii) The Cotton Board, with approval of the Secretary, may notify 
individual producers that the assessments collected by such producer's 
collecting handler, whose name is subject to publication in accordance 
with the provisions of paragraph (a)(4)(i) of this section, have not 
been remitted to the Cotton Board as required.
    (b) Any importer who fails to submit reports to the Cotton Board 
pursuant to request made according to Sec. 1205.516 or assessments to 
the Customs Service, shall be subject to one or more of the following 
actions:
    (1) Audits of the importer's books and records to determine the 
amount owed the Cotton Board.
    (2) A deduction for the amount of any unpaid assessment by the 
Customs Service from the importers surety bond.
    (3) Referral to the Secretary for appropriate enforcement action.

[57 FR 29191, July 1, 1992]



Sec. 1205.518  Receipts for payment of assessments.

    Each collecting handler who is required by Sec. 1205.512 and Sec. 
1205.513 to give the producer a receipt showing payment of cotton 
research and promotion assessments shall provide the producer with an 
invoice or settlement sheet for the cotton. Such document shall serve as 
a receipt shall contain the following information:
    (a) Name and address of collecting handler.
    (b) Gin code number of gin at which cotton was ginned.
    (c) Name and address of producer who paid assessment.
    (d) Number of bales on which assessment was paid.
    (e) Gross price per pound received by the producer.
    (f) Total assessments paid by the producer.
    (g) Date on which assessment was paid by producer.

(Approved by the Office of Management and Budget under control number 
0581-0115)

[42 FR 35974, July 13, 1977, as amended at 49 FR 8420, Mar. 7, 1984. 
Redesignated and amended at 51 FR 6099, Feb. 20, 1986. Further 
redesignated at 57 FR 29190, July 1, 1992]

                             Reimbursements



Sec. 1205.520  Procedure for obtaining reimbursement.

    Each importer against whose imports of cotton or cotton-containing 
products any assessments are made and collected may obtain a 
reimbursement on that portion of the assessment that was collected on 
cotton produced in the United States or cotton other than Upland cotton 
by following the procedures prescribed in this section.
    (a) Application form. An importer shall obtain a reimbursement 
application form from the Cotton Board. Such form may be obtained by 
written request to the Cotton Board and the request shall bear the 
importer's signature or the importer's properly-witnessed mark.
    (b) Submission of reimbursement application to Cotton Board. Any 
importer requesting a reimbursement shall mail the application on the 
prescribed form to the Cotton Board. The application shall be postmarked 
within 180 days from the date the assessments were paid on the cotton by 
such importer. The reimbursement application shall show:
    (1) The importer's name, address, phone number and Customs Service 
identification number;

[[Page 45]]

    (2) Weight of the cotton in each HTS category for which the 
reimbursement is requested;
    (3) Subtotal amounts to be reimbursed for each HTS number and grand 
total to be reimbursed;
    (4) Date or inclusive dates on which the assessments were paid;
    (5) The name of the port of entry; and
    (6) Certification by the importer that the cotton was grown in the 
U.S. or is other than Upland cotton.
    (c) Where more than one importer shared in the assessment payment on 
cotton, joint or separate reimbursement application forms may be filed. 
In any such case, the reimbursement application shall show the names, 
addresses and proportionate shares of assessments paid by all importers. 
The reimbursement application shall bear the signature of each importer 
seeking reimbursement.
    (d) Proof of payment of the assessment on U.S. produced or other 
than Upland cotton. A copy of the Customs entry form and the commercial 
invoice filed with the Customs Service shall accompany the importer's 
reimbursement application. Within 60 days from the date the properly 
executed application for reimbursement is received by the Cotton Board, 
the Cotton Board shall make reimbursement to the importer. For joint 
applications, the reimbursement shall be made payable to all eligible 
importers signing the reimbursement application. Documentation submitted 
with reimbursement applications shall not be returned to the importer.

[57 FR 29192, July 1, 1992, as amended at 62 FR 22879, Apr. 28, 1997]

                           Warehouse Receipts



Sec. 1205.525  Entry of gin code number.

    The warehouse that first receives a bale for storage after ginning 
shall enter the gin code number of the gin at which the bale was ginned 
on the warehouse receipt issued for the bale.

[57 FR 29192, July 1, 1992]

                           Reports and Records



Sec. 1205.530  Gin reports and reporting schedule.

    (a) Gin reports. Each year each cotton gin in the United States 
shall submit reports to the Cotton Board on forms or certificates made 
available or approved by the Cotton Board as follows:
    (1) End-of-season report. Except as provided in paragraph (a)(2) of 
this section, each gin shall report to the Cotton Board an alphabetical 
listing of producer names, their addresses, and the number of bales 
ginned for each such producer during its ginning season.
    (2) Certificate in Lieu of End-of-Season Report. If a gin is the 
collecting handler on every bale ginned at such gin and collecting 
handler reports and remittances of assessments have been made in 
accordance with Sec. 1205.516, a certification to that effect may be 
made to the Cotton Board in lieu of an end-of-season report.
    (b) Reporting schedule. The schedule for submitting gin reports is 
as follows:
    (1) Each gin that completes ginning operations prior to January 16 
shall make a report to the Cotton Board within 10 days after completion 
of ginning.
    (2) Each gin that operates on or after January 16 will make a report 
to the Cotton Board not later than January 25 covering bales ginned 
through January 15.
    (3) Each gin that operates after January 15 shall make a 
supplemental report to the Cotton Board within 10 days after the close 
of ginning operations covering bales ginned after January 15.

[42 FR 35974, July 13, 1977, as amended at 57 FR 29192, July 1, 1992]



Sec. 1205.531  Records.

    Each handler or importer required to make reports pursuant to this 
subpart shall maintain such books and records as are necessary to verify 
the reports.

[57 FR 29192, July 1, 1992]

[[Page 46]]



Sec. 1205.532  Retention period for reports and records.

    Each handler and importer required to make reports pursuant to this 
subpart shall retain for at least 2 years beyond the marketing year of 
their applicability:
    (a) One copy of the report made to the Cotton Board; and
    (b) Such books and records as are necessary to verify such reports.

[57 FR 29192, July 1, 1992]



Sec. 1205.533  Availability of reports and records.

    Each handler and importer required to make reports pursuant to this 
subpart shall make available for inspection by the Cotton Board, 
including its designated employees, and the Secretary any reports, 
books, or records required under this subpart.

[57 FR 29192, July 1, 1992]

                        Confidential Information



Sec. 1205.540  Confidential books, records, and reports.

    All information obtained from the books, records, and reports of 
handlers and importers shall be kept confidential in the manner and to 
the extent provided for in Sec. 1205.340.

[57 FR 29192, July 1, 1992]



Sec. 1205.541  OMB control numbers.

    The control number assigned to the information collection 
requirements by the Office of Management and Budget pursuant to the 
Paperwork Reduction Act of 1980, Public Law 96-511, is OMB number 0581-
0093, except Board member nominee information sheets are assigned OMB 
number 0505-0001.

[57 FR 29192, July 1, 1992]

Subpart--Fiscal Period [Reserved]



PART 1206_MANGO PROMOTION, RESEARCH, AND INFORMATION--Table of Contents




 Subpart A Mango Promotion, Research, and Information Order Definitions

Sec.
1206.1 Act.
1206.2 Board.
1206.3 Conflict of interest.
1206.4 Customs.
1206.5 Department.
1206.6 First handler.
1206.7 Fiscal period.
1206.8 Foreign producer.
1206.9 Importer.
1206.10 Information.
1206.11 Mangos.
1206.12 Market or marketing.
1206.13 Order.
1206.14 Part.
1206.15 Person.
1206.16 Producer.
1206.17 Promotion.
1206.18 Research.
1206.19 Retailer.
1206.20 Secretary.
1206.21 Suspend.
1206.22 Terminate.
1206.23 United States.
1206.24 Wholesaler.

                     National Mango Promotion Board

1206.30 Establishment and membership.
1206.31 Nominations and appointments.
1206.32 Term of office.
1206.33 Vacancies.
1206.34 Procedure.
1206.35 Compensation and reimbursement.
1206.36 Powers and duties.
1206.37 Prohibited activities.

                        Expenses and Assessments

1206.40 Budget and expenses.
1206.41 Financial statements.
1206.42 Assessments.
1206.43 Exemptions.

                  Promotion, Research, and Information

1206.50 Programs, plans, and projects.
1206.51 Independent evaluation.
1206.52 Patents, copyrights, trademarks, information, publications, and 
          product formulations.

                       Reports, Books, and Records

1206.60 Reports.
1206.61 Books and records.
1206.62 Confidential treatment.

                              Miscellaneous

1206.70 Right of the Secretary.
1206.71 Referenda.
1206.72 Suspension and termination.
1206.73 Proceedings after termination.
1206.74 Effect of termination or amendment.
1206.75 Personal liability.
1206.76 Separability.
1206.77 Amendments.
1206.78 OMB control number.

                    Subpart B_Referendum Procedures.

1206.100 General.
1206.101 Definitions.

[[Page 47]]

1206.102 Voting.
1206.103 Instructions.
1206.104 Subagents.
1206.105 Ballots.
1206.106 Referendum report.
1206.107 Confidential information.
1206.108 OMB control number.

    Source: 68 FR 58554, Oct. 9, 2003, unless otherwise noted.

    Authority: 7 U.S.C. 7411-7425.



 Subpart A_Mango Promotion, Research, and Information Order Definitions

    Source: 69 FR 59122, Oct. 4, 2004, unless otherwise noted.



Sec. 1206.1  Act.

    Act means the Commodity Promotion, Research, and Information Act of 
1996 (7 U.S.C. 7411-7425; Public Law 104-127; 110 Stat. 1029), or any 
amendments thereto.



Sec. 1206.2  Board.

    Board or National Mango Promotion Board means the administrative 
body established pursuant to Sec. 1206.30, or such other name as 
recommended by the Board and approved by the Department.



Sec. 1206.3  Conflict of interest.

    Conflict of interest means a situation in which a member or employee 
of the Board has a direct or indirect financial interest in a person who 
performs a service for, or enters into a contract with, the Board for 
anything of economic value.



Sec. 1206.4  Customs.

    Customs means the Customs and Border Protection of the U.S. 
Department of Homeland Security.



Sec. 1206.5  Department.

    Department means the U.S. Department of Agriculture or any officer 
or employee of the Department to whom authority has heretofore been 
delegated, or to whom authority may hereafter be delegated, to act in 
the Secretary's stead.



Sec. 1206.6  First handler.

    First handler means any person, (excluding a common or contract 
carrier), receiving 500,000 or more pounds of mangos from producers in a 
calendar year and who as owner, agent, or otherwise ships or causes 
mangos to be shipped as specified in this Order. This definition 
includes those engaged in the business of buying, selling and/or 
offering for sale; receiving; packing; grading; marketing; or 
distributing mangos in commercial quantities. The term first handler 
includes a producer who handles or markets mangos of the producer's own 
production.



Sec. 1206.7  Fiscal period.

    Fiscal period means a calendar year from January 1 through December 
31, or such other period as recommended by the Board and approved by the 
Department.



Sec. 1206.8  Foreign producer.

    Foreign producer means any person:
    (1) Who is engaged in the production and sale of mangos outside of 
the United States and who owns, or shares the ownership and risk of loss 
of the crop for sale in the U.S. market or
    (2) Who is engaged, outside of the United States, in the business of 
producing, or causing to be produced, mangos beyond the person's own 
family use and having value at first point of sale.



Sec. 1206.9  Importer.

    Importer means any person importing 500,000 or more pounds of mangos 
into the United States in a calendar year as a principal or as an agent, 
broker, or consignee of any person who produces or handles mangos 
outside of the United States for sale in the United States, and who is 
listed as the importer of record for such mangos.



Sec. 1206.10  Information.

    Information means information and programs that are designed to 
develop new markets, marketing strategies, increase market efficiency, 
and activities that are designed to enhance the image of mangos in the 
United States. These include:

[[Page 48]]

    (a) Consumer information, which means any action taken to provide 
information to, and broaden the understanding of, the general public 
regarding the consumption, use, nutritional attributes, and care of 
mangos; and
    (b) Industry information, which means information and programs that 
will lead to the development of new markets, new marketing strategies, 
or increased efficiency for the mango industry, and activities to 
enhance the image of the mango industry.



Sec. 1206.11  Mangos.

    Mangos means all fresh fruit of Mangifera indica L. of the family 
Anacardiaceae.



Sec. 1206.12  Market or marketing.

    Marketing means the sale or other disposition of mangos in the U.S. 
domestic market. To market means to sell or otherwise dispose of mangos 
in interstate or intrastate channels of commerce.



Sec. 1206.13  Order.

    Order means an order issued by the Department under section 514 of 
the Act that provides for a program of generic promotion, research, and 
information regarding agricultural commodities authorized under the Act.



Sec. 1206.14  Part.

    Part means part 1206 which includes the Mango Promotion, Research, 
and Information Order and all rules, regulations, and supplemental 
orders issued pursuant to the Act and the Order.



Sec. 1206.15  Person.

    Person means any individual, group of individuals, partnership, 
corporation, association, cooperative, or any other legal entity.



Sec. 1206.16  Producer.

    Producer means any person who is engaged in the production and sale 
of mangos in the United States and who owns, or shares the ownership and 
risk of loss of, the crop or a person who is engaged in the business of 
producing, or causing to be produced, mangos beyond the person's own 
family use and having value at first point of sale.



Sec. 1206.17  Promotion.

    Promotion means any action taken to present a favorable image of 
mangos to the general public and the food industry for the purpose of 
improving the competitive position of mangos and stimulating the sale of 
mangos in the United States. This includes paid advertising and public 
relations.



Sec. 1206.18  Research.

    Research means any type of test, study, or analysis designed to 
advance the image, desirability, use, marketability, production, product 
development, or quality of mangos, including research relating to 
nutritional value, cost of production, new product development, varietal 
development, nutritional value and benefits, and marketing of mangos.



Sec. 1206.19  Retailer.

    Retailer means a person engaged in the business of selling mangos 
only to consumers.



Sec. 1206.20  Secretary.

    Secretary means the Secretary of Agriculture of the United States.



Sec. 1206.21  Suspend.

    Suspend means to issue a rule under section 553 of title 5, U.S.C., 
to temporarily prevent the operation of an order or part thereof during 
a particular period of time specified in the rule.



Sec. 1206.22  Terminate.

    Terminate means to issue a rule under section 553 of title 5, 
U.S.C., to cancel permanently the operation of an order or part thereof 
beginning on a certain date specified in the rule.



Sec. 1206.23  United States.

    United States or U.S. means collectively the 50 states, the District 
of Columbia, the Commonwealth of Puerto Rico, and the territories and 
possessions of the United States.



Sec. 1206.24  Wholesaler.

    Wholesaler means any person engaged in the purchase, assembly, 
transportation, storage, and distribution of mangos for sale to other 
wholesalers, retailers, and foodservice firms.

[[Page 49]]

                     National Mango Promotion Board



Sec. 1206.30  Establishment and membership.

    (a) Establishment of the National Mango Promotion Board. There is 
hereby established a National Mango Promotion Board composed of eight 
importers, one first handler, two domestic producers, seven foreign 
producers, and two non-voting wholesalers and/or retailers of mangos in 
the United States. The chairperson shall reside in the United States and 
the Board office shall also be located in the United States.
    (b) Importer districts. The importer seats shall be allocated based 
on the volume of mangos imported into the Customs Districts identified 
by their name and Code Number as defined in the Harmonized Tariff 
Schedule of the United States. The initial allocation will be two seats 
for District I, three seats for District II, two seats for District III, 
and one seat for District IV.
    (1) District I includes the Customs Districts of Portland, ME (01), 
St. Albans, VT (02), Boston, MA (04), Providence, RI (05), Ogdensburg, 
NY (07), Buffalo, NY (09), New York City, NY (10), Philadelphia, PA 
(11), Baltimore, MD (13), Norfolk, VA (14), Charlotte, NC (15), 
Charleston, SC (16), Savannah, GA (17), Tampa, FL (18), San Juan, PR 
(49), Virgin Islands of the United States (51), Miami, FL (52) and 
Washington, DC (54).
    (2) District II includes the Customs Districts of Mobile, AL (19), 
New Orleans, LA (20), Port Arthur, TX (21), Laredo, TX (23), 
Minneapolis, MN (35), Duluth, MN (36), Milwaukee, WI (37), Detroit, MI 
(38), Chicago, IL (39), Cleveland, OH (41), St. Louis, MO (45), Houston, 
TX (53), and Dallas-Fort Worth, TX (55).
    (3) District III includes the Customs Districts of El Paso, TX (24), 
Nogales, AZ (26), Great Falls, MT (33), and Pembina, ND (34).
    (4) District IV includes the Customs Districts of San Diego, CA 
(25), Los Angeles, CA (27), San Francisco, CA (28), Columbia-Snake, OR 
(29), Seattle, WA (30), Anchorage, AK (31), and Honolulu, HI (32).
    (c) Adjustment of membership. At least once every five years, the 
Board will review the geographical distribution of production of mangos 
in the United States, the geographical distribution of the importation 
of mangos into the United States, the quantity of mangos produced in the 
United States, and the quantity of mangos imported into the United 
States. The review will be based on Board assessment records and 
statistics from the Department. If warranted, the Board will recommend 
to the Department that membership on the Board be altered to reflect any 
changes in geographical distribution of domestic mango production and 
importation and the quantity of domestic production and imports. To 
ensure equitable representation, additional first handlers may be added 
to the Board to reflect increases in domestic production.



Sec. 1206.31  Nominations and appointments.

    (a) Voting for first handler, importer, and domestic producer 
members will be made by mail ballot.
    (b) There shall be two nominees for each position on the Board.
    (c) Nominations for the initial Board will be handled by the 
Department. Subsequent nominations will be handled by the Board's staff.
    (d) Nominees to fill the first handler member position on the Board 
shall be solicited from all known first handlers. The nominees shall be 
placed on a ballot which will be sent to all first handlers for a vote. 
The nominee receiving the highest number of votes and the nominee 
receiving the second highest number of votes shall be submitted to the 
Department as the first handlers' first and second choice nominees.
    (e) Nominees to fill the importer positions on the Board shall be 
solicited from all known importers of mangos. The members from each 
district shall select the nominees for two positions on the Board. Two 
nominees shall be submitted for each position. The nominees shall be 
placed on a ballot which will be sent to importers in the districts for 
a vote. For each position, the nominee receiving the highest number of 
votes and the nominee receiving the second highest number of votes shall 
be submitted to the Department as the

[[Page 50]]

importers' first and second choice nominees.
    (f) Nominees to fill the domestic producer member positions on the 
Board shall be solicited from all known domestic producers. The nominees 
shall be placed on a ballot which will be sent to all domestic producers 
for a vote. The nominee receiving the highest number of votes and the 
nominee receiving the second highest number of votes shall be submitted 
to the Department as the producers' first and second choice nominees.
    (g) Nominees to fill the foreign producer member positions on the 
Board shall be solicited from organizations of foreign mango producers. 
Each organization shall submit two nominees for each position, and the 
nominees shall be representative of the major countries exporting mangos 
to the United States.
    (h) The Board will nominate the wholesaler and/or retailer members.
    (i) From the nominations, the Secretary shall select the members of 
the Board.



Sec. 1206.32  Term of office.

    The term of office for first handler, importer, domestic producer, 
and foreign producer members of the Board will be three years, and these 
members may serve a maximum of two consecutive three-year terms. The 
term of office for wholesaler/retailer members shall be one year, and 
these members may serve a maximum of three consecutive one-year terms. 
When the Board is first established, the first handler, two importers, 
one domestic producer, and two foreign producers will be assigned 
initial terms of four years; three importers, one domestic producer, and 
two foreign producers will be assigned initial terms of three years; and 
three importers and three foreign producers will be assigned initial 
terms of two years. Thereafter, each of these positions will carry a 
full three-year term. Members serving initial terms of two or four years 
will be eligible to serve a second term of three years. Each term of 
office will end on December 31, with new terms of office beginning on 
January 1.



Sec. 1206.33  Vacancies.

    (a) In the event that any member of the Board ceases to be a member 
of the category of members from which the member was appointed to the 
Board, such position shall automatically become vacant.
    (b) If a member of the Board consistently refuses to perform the 
duties of a Board member, or if a member of the Board engages in acts of 
dishonesty or willful misconduct, the Board may recommend to the 
Department that the member be removed from office. If the Department 
finds the recommendation of the Board shows adequate cause, the 
Department shall remove such member from office.
    (c) Should any member position become vacant, successors for the 
unexpired term of the member shall be appointed in the manner specified 
in Sec. 1206.31, except that nomination and replacement shall not be 
required if the unexpired term is less than six months.



Sec. 1206.34  Procedure.

    (a) At a Board meeting, it will be considered a quorum when at least 
ten voting members are present.
    (b) At the start of each fiscal period, the Board will select a 
chairperson and vice chairperson who will conduct meetings throughout 
that period.
    (c) All Board members will be notified at least 30 days in advance 
of all Board and committee meetings unless an emergency meeting is 
declared.
    (d) Each voting member of the Board will be entitled to one vote on 
any matter put to the Board, and the motion will carry if supported by 
one vote more than 50 percent of the total votes represented by the 
Board members present.
    (e) It will be considered a quorum at a committee meeting when at 
least one more than half of those assigned to the committee are present. 
Committees may consist of individuals other than Board members, and such 
individuals may vote in committee meetings. Committee members shall 
serve without compensation but shall be reimbursed for reasonable travel 
expenses, as approved by the Board.

[[Page 51]]

    (f) In lieu of voting at a properly convened meeting and, when in 
the opinion of the chairperson of the Board such action is considered 
necessary, the Board may take action if supported by one vote more than 
50 percent of the members by mail, telephone, electronic mail, 
facsimile, or any other means of communication. In that event, all 
members must be notified and provided the opportunity to vote. Any 
action so taken shall have the same force and effect as though such 
action had been taken at a properly convened meeting of the Board. All 
telephone votes shall be confirmed promptly in writing. All votes shall 
be recorded in Board minutes.
    (g) There shall be no voting by proxy.
    (h) The chairperson shall be a voting member and shall reside in the 
U.S.
    (i) The organization of the Board and the procedures for conducting 
meetings of the Board shall be in accordance with its bylaws, which 
shall be established by the Board and approved by the Department.



Sec. 1206.35  Compensation and reimbursement.

    The members of the Board shall serve without compensation but shall 
be reimbursed for reasonable travel expenses, as approved by the Board, 
incurred by them in the performance of their duties as Board members.



Sec. 1206.36  Powers and duties.

    The Board shall have the following powers and duties:
    (a) To administer the Order in accordance with its terms and 
conditions and to collect assessments;
    (b) To develop and recommend to the Department for approval such 
bylaws as may be necessary for the functioning of the Board, and such 
rules as may be necessary to administer the Order, including activities 
authorized to be carried out under the Order;
    (c) To meet, organize, and select from among the members of the 
Board a chairperson, other officers, committees, and subcommittees, as 
the Board determines appropriate;
    (d) To employ persons, other than the members, as the Board 
considers necessary to assist the Board in carrying out its duties and 
to determine the compensation and specify the duties of such persons;
    (e) To develop programs, plans, and projects, and enter into 
contracts or agreements, which must be approved by the Department before 
becoming effective, for the development and carrying out of programs or 
projects of research, information, or promotion, and the payment of 
costs thereof with funds collected pursuant to this subpart. Each 
contract or agreement shall provide that: any person who enters into a 
contract or agreement with the Board shall develop and submit to the 
Board a proposed activity; keep accurate records of all of its 
transactions relating to the contract or agreement; account for funds 
received and expended in connection with the contract or agreement; make 
periodic reports to the Board of activities conducted under the contract 
or agreement; and, make such other reports available as the Board or the 
Department considers relevant. Furthermore, any contract or agreement 
shall provide that:
    (1) The contractor or agreeing party shall develop and submit to the 
Board a program, plan, or project together with a budget or budgets that 
shall show the estimated cost to be incurred for such program, plan, or 
project;
    (2) The contractor or agreeing party shall keep accurate records of 
all its transactions and make periodic reports to the Board of 
activities conducted, submit accounting for funds received and expended, 
and make such other reports as the Department or the Board may require;
    (3) The Department may audit the records of the contracting or 
agreeing party periodically; and
    (4) Any subcontractor who enters into a contract with a Board 
contractor and who receives or otherwise uses funds allocated by the 
Board shall be subject to the same provisions as the contractor.
    (f) To prepare and submit for approval of the Department calendar 
year budgets in accordance with Sec. 1206.40;
    (g) To maintain such records and books and prepare and submit such 
reports and records from time to time to the Department as the 
Department may prescribe; to make appropriate accounting with respect to 
the receipt

[[Page 52]]

and disbursement of all funds entrusted to it; and to keep records that 
accurately reflect the actions and transactions of the Board;
    (h) To cause its books to be audited by a competent auditor at the 
end of each calendar year and at such other times as the Department may 
request, and to submit a report of the audit directly to the Department;
    (i) To give the Department the same notice of Board and committee 
meetings as is given to members in order that the Department's 
representative(s) may attend such meetings.
    (j) To act as intermediary between the Department and any first 
handler or importer;
    (k) To furnish to the Department any information or records that the 
Department may request;
    (l) To receive, investigate, and report to the Department complaints 
of violations of the Order;
    (m) To recommend to the Department such amendments to the Order as 
the Board considers appropriate; and
    (n) To work to achieve an effective, continuous, and coordinated 
program of promotion, research, consumer information, evaluation, and 
industry information designed to strengthen the mango industry's 
position in the U.S. domestic market; maintain and expand existing 
markets and uses for mangos; and to carry out programs, plans, and 
projects designed to provide maximum benefits to the mango industry.



Sec. 1206.37  Prohibited activities.

    The Board may not engage in, and shall prohibit the employees and 
agents of the Board from engaging in:
    (a) Any action that is a conflict of interest; and
    (b) Using funds collected by the Board under the Order to undertake 
any action for the purpose of influencing legislation or governmental 
action or policy, by local, state, national, and foreign governments, 
other than recommending to the Department amendments to the Order.

                        Expenses and Assessments



Sec. 1206.40  Budget and expenses.

    (a) At least 60 days prior to the beginning of each calendar year, 
and as may be necessary thereafter, the Board shall prepare and submit 
to the Department a budget for the calendar year covering its 
anticipated expenses and disbursements in administering this subpart. 
Each such budget shall include:
    (1) A statement of objectives and strategy for each program, plan, 
or project;
    (2) A summary of anticipated revenue, with comparative data or at 
least one preceding year (except for the initial budget);
    (3) A summary of proposed expenditures for each program, plan, or 
project; and
    (4) Staff and administrative expense breakdowns, with comparative 
data for at least one preceding year (except for the initial budget).
    (b) Each budget shall provide adequate funds to defray its proposed 
expenditures and to provide for a reserve as set forth in this subpart.
    (c) Subject to this section, any amendment or addition to an 
approved budget must be approved by the Department, including shifting 
funds from one program, plan, or project to another. Shifts of funds 
which do not cause an increase in the Board's approved budget and which 
are consistent with governing bylaws need not have prior approval by the 
Department.
    (d) The Board is authorized to incur such expenses, including 
provision for a reserve, as the Department finds reasonable and likely 
to be incurred by the Board for its maintenance and functioning, and to 
enable it to exercise its powers and perform its duties in accordance 
with the provisions of this subpart. Such expenses shall be paid from 
funds received by the Board.
    (e) With approval of the Department, the Board may borrow money for 
the payment of administrative expenses, subject to the same fiscal, 
budget, and audit controls as other funds of the Board. Any funds 
borrowed by the Board shall be expended only for startup costs and 
capital outlays and are limited to the first year of operation of the 
Board.
    (f) The Board may accept voluntary contributions, but these shall 
only be used to pay expenses incurred in the conduct of programs, plans, 
and

[[Page 53]]

projects. Voluntary contributions shall be free from any encumbrance by 
the donor, and the Board shall retain complete control of their use.
    (g) The Board shall reimburse the Department for all expenses 
incurred by the Department in the implementation, administration, and 
supervision of the Order, including all referendum costs in connection 
with the Order.
    (h) The Board may not expend for administration, maintenance, and 
functioning of the Board in any calendar year an amount that exceeds 15 
percent of the assessments and other income received by the Board for 
that calendar year. Reimbursements to the Department required under 
paragraph (g) of this section, are excluded from this limitation on 
spending.
    (i) The Board may establish an operating monetary reserve and may 
carry over to subsequent fiscal periods excess funds in any reserve so 
established: Provided that the funds in the reserve do not exceed one 
fiscal period's budget. Subject to approval by the Department, such 
reserve funds may be used to defray any expenses authorized under this 
part.



Sec. 1206.41  Financial statements.

    (a) As requested by the Department, the Board shall prepare and 
submit financial statements to the Department on a periodic basis. Each 
such financial statement shall include, but not be limited to, a balance 
sheet, income statement, and expense budget. The expense budget shall 
show expenditures during the time period covered by the report, year-to-
date expenditures, and the unexpended budget.
    (b) Each financial statement shall be submitted to the Department 
within 30 days after the end of the time period to which it applies.
    (c) The Board shall submit annually to the Department an annual 
financial statement within 90 days after the end of the calendar year to 
which it applies.



Sec. 1206.42  Assessments.

    (a) The funds to cover the Board's expenses shall be paid from 
assessments on first handlers and importers, donations from any person 
not subject to assessments under this Order, and other funds available 
to the Board and subject to the limitations contained therein.
    (b) The assessment rate shall be \1/2\ cent per pound on all mangos. 
The assessment rate will be reviewed and may be modified by the Board 
with the approval of the Department, after the first referendum is 
conducted as stated in Sec. 1206.71(b). The Department will amend this 
section if the assessment rate is modified.
    (c) Domestic mangos. First handlers of domestic mangos are required 
to pay assessments on all mangos handled for the U.S. market. This 
includes mangos of the first handler's own production.
    (d) Imported mangos. Each importer of mangos shall pay an assessment 
to the Board through Customs on mangos imported for marketing in the 
United States.
    (1) The assessment rate for imported mangos shall be the same or 
equivalent to the rate for mangos produced in the United States.
    (2) The import assessment shall be uniformly applied to imported 
mangos that are identified by the numbers 0804.50.4040 and 0804.50.6040 
in the Harmonized Tariff Schedule of the United States.
    (3) The assessments due on imported mangos shall be paid when they 
enter or are withdrawn for consumption in the United States.
    (e) Each person responsible for remitting assessments under 
paragraph (c) of this section shall remit the amounts due to the Board's 
office on a monthly basis no later than the fifteenth day of the month 
following the month in which the mangos were marketed, in such manner as 
prescribed by the Board.
    (f) A late payment charge shall be imposed on any person failing to 
remit to the Board the total amount for which the person is liable by 
the payment due date established under this section. The amount of the 
late payment charge shall be prescribed by the Department.
    (g) An additional charge shall be imposed on any person subject to a 
late payment charge in the form of interest on the outstanding portion 
of any amount for which the person is liable.

[[Page 54]]

The rate of interest shall be prescribed by the Department.
    (h) Persons failing to remit total assessments due in a timely 
manner may also be subject to actions under federal debt collection 
procedures.
    (i) The Board may authorize other organizations to collect 
assessments on its behalf with the approval of the Department.



Sec. 1206.43  Exemptions.

    (a) Any first handler or importer of less than 500,000 pounds of 
mangos per calendar year may claim an exemption from the assessments 
required under Sec. 1206.42. Mangos produced domestically and exported 
from the United States may annually claim an exemption from the 
assessments required under Sec. 1206.42.
    (b) A first handler or importer desiring an exemption shall apply to 
the Board, on a form provided by the Board, for a certificate of 
exemption. A first handler shall certify that the first handler will 
handle less than 500,000 pounds of domestic mangos for the fiscal period 
for which the exemption is claimed. An importer shall certify that the 
importer will import less than 500,000 pounds of mangos during the 
fiscal period for which the exemption is claimed.
    (c) Upon receipt of an application, the Board shall determine 
whether an exemption may be granted. The Board then will issue, if 
deemed appropriate, a certificate of exemption to each person who is 
eligible to receive one. It is the responsibility of these persons to 
retain a copy of the certificate of exemption.
    (d) Importers who receive a certificate of exemption shall be 
eligible for reimbursement of assessments collected by Customs. These 
importers shall apply to the Board for reimbursement of any assessments 
paid. No interest will be paid on the assessments collected by Customs. 
Requests for reimbursement shall be submitted to the Board within 90 
days of the last day of the calendar year the mangos were actually 
imported.
    (e) Any person who desires an exemption from assessments for a 
subsequent calendar year shall reapply to the Board, on a form provided 
by the Board, for a certificate of exemption.
    (f) The Board may require persons receiving an exemption from 
assessments to provide to the Board reports on the disposition of exempt 
mangos and, in the case of importers, proof of payment of assessments.

                  Promotion, Research, and Information



Sec. 1206.50  Programs, plans, and projects.

    (a) The Board shall receive and evaluate, or on its own initiative 
develop, and submit to the Department for approval any program, plan, or 
project authorized under this subpart. Such programs, plans, or projects 
shall provide for:
    (1) The establishment, issuance, effectuation, and administration of 
appropriate programs for promotion, research, and information, including 
producer and consumer information, with respect to mangos; and
    (2) The establishment and conduct of research with respect to: the 
use, nutritional value and benefits, sale, distribution, and marketing 
of mangos in the United States; the creation of new products thereof, to 
the end that the marketing and use of mangos in the United States may be 
encouraged, expanded, improved, or made more acceptable; and to advance 
the image, desirability, or quality of mangos in the United States.
    (b) No program, plan, or project shall be implemented prior to its 
approval by the Department. Once a program, plan, or project is so 
approved, the Board shall take appropriate steps to implement it.
    (c) Each program, plan, or project implemented under this subpart 
shall be reviewed or evaluated periodically by the Board to ensure that 
it contributes to an effective program of promotion, research, or 
information. If it is found by the Board that any such program, plan, or 
project does not contribute to an effective program of promotion, 
research, or information, then the Board shall terminate such program, 
plan, or project.
    (d) No program, plan, or project including advertising shall be 
false or

[[Page 55]]

misleading or disparaging to another agricultural commodity. Mangos of 
all origins shall be treated equally.



Sec. 1206.51  Independent evaluation.

    The Board shall, not less often than every five years, authorize and 
fund, from funds otherwise available to the Board, an independent 
evaluation of the effectiveness of the Order and other programs 
conducted by the Board pursuant to the Act. The Board shall submit to 
the Department, and make available to the public, the results of each 
periodic independent evaluation conducted under this paragraph.



Sec. 1206.52  Patents, copyrights, trademarks, information, 
publications, and product formulations.

    Patents, copyrights, trademarks, information, publications, and 
product formulations developed through the use of funds received by the 
Board under this subpart shall be the property of the U.S. Government, 
as represented by the Board, and shall, along with any rents, royalties, 
residual payments, or other income from the rental, sales, leasing, 
franchising, or other uses of such patents, copyrights, trademarks, 
information, publications, or product formulations, inure to the benefit 
of the Board; shall be considered income subject to the same fiscal, 
budget, and audit controls as other funds of the Board; and may be 
licensed subject to approval by the Department Upon termination of this 
subpart, Sec. 1206.73 shall apply to determine disposition of all such 
property.

                       Reports, Books, and Records



Sec. 1206.60  Reports.

    (a) Each first handler will be required to provide to the Board 
periodically such information as may be required by the Board, with the 
approval of the Department, which may include but not be limited to the 
following:
    (1) Number of pounds of domestic mangos handled;
    (2) Number of pounds of domestic mangos on which an assessment was 
paid;
    (3) Name and address of the producers from whom the first handler 
has received mangos;
    (4) Date that assessment payments were made on each pound of 
domestic mangos handled;
    (5) Number of pounds of domestic mangos exported;
    (6) The first handler's tax identification number;
    (b) Each importer may be required to provide to the Board 
periodically such information as may be required by the Board, with the 
approval of the Department, which may include but not be limited to the 
following:
    (1) Number of pounds of mangos imported;
    (2) Number of pounds of mangos on which an assessment was paid;
    (3) Name, address, and tax identification number of the importer; 
and
    (4) Date that assessment payments were made on each pound imported.



Sec. 1206.61  Books and records.

    Each first handler and importer shall maintain and make available 
for inspection by the Department such books and records as are necessary 
to carry out the provisions of this part, any regulations issued under 
this part, including such records as are necessary to verify any reports 
required. Such records shall be retained for at least two years beyond 
the fiscal period of their applicability.



Sec. 1206.62  Confidential treatment.

    All information obtained from books, records, or reports under the 
Act and this part shall be kept confidential by all persons, including 
all employees and former employees of the Board, all officers and 
employees and former officers and employees of contracting and 
subcontracting agencies or agreeing parties having access to such 
information. Such information shall not be available to Board members, 
first handlers, or importers. Only those persons having a specific need 
for such information to effectively administer the provisions of this 
subpart shall have access to such information. Only such information so 
obtained as the Secretary deems relevant shall be disclosed by them, and 
then only in a judicial proceeding or administrative hearing brought at 
the direction, or on the request, of the Secretary, or to which the 
Secretary or any officer of

[[Page 56]]

the United States is a party, and involving this subpart. Nothing in 
this section shall be deemed to prohibit:
    (a) The issuance of general statements based upon the reports of the 
number of persons subject to this subpart or statistical data collected 
therefrom, which statements do not identify the information furnished by 
any person; and
    (b) The publication, by direction of the Secretary, of the name of 
any person who has been adjudged to have violated this part, together 
with a statement of the particular provisions of this part violated by 
such person.

                              Miscellaneous



Sec. 1206.70  Right of the Secretary.

    All fiscal matters, programs, plans, or projects, rules or 
regulations, reports, or other substantive actions proposed and prepared 
by the Board shall be submitted to the Secretary for approval.



Sec. 1206.71  Referenda.

    (a) Initial Referendum. The Order shall not become effective unless:
    (1) The Department determines that the Order is consistent with and 
will effectuate the purposes of the Act; and
    (2) The Order is approved by a majority of the first handlers and 
importers voting, who, during a representative period determined by the 
Department, have been engaged in the handling or importation of mangos.
    (b) Subsequent referenda. Every five years, the Department shall 
hold a referendum to determine whether first handlers and importers of 
mangos favor the continuation of the Order. The Order shall continue if 
it is favored by a majority of the first handlers and importers voting 
who, during a representative period determined by the Department, have 
been engaged in the handling or importation of mangos. The Department 
will also conduct a referendum if 10 percent or more of all non-exempt, 
first handlers and importers of mangos request the Department to hold a 
referendum. In addition, the Department may hold a referendum at any 
time.



Sec. 1206.72  Suspension and termination.

    (a) The Department shall suspend or terminate this part or subpart 
or a provision thereof if the Department finds that the subpart or a 
provision thereof obstructs or does not tend to effectuate the purposes 
of the Act, or if the Department determines that this subpart or a 
provision thereof is not favored by persons voting in a referendum 
conducted pursuant to the Act.
    (b) The Department shall suspend or terminate this subpart at the 
end of the marketing year whenever the Department determines that its 
suspension or termination is approved or favored by a majority of the 
first handlers and importers voting who, during a representative period 
determined by the Department, have been engaged in the handling or 
importation of mangos.
    (c) If, as a result of a referendum the Department determines that 
this subpart is not approved, the Department shall:
    (1) Not later than 180 days after making the determination, suspend 
or terminate, as the case may be, collection of assessments under this 
subpart; and
    (2) As soon as practical, suspend or terminate, as the case may be, 
activities under this subpart in an orderly manner.



Sec. 1206.73  Proceedings after termination.

    (a) Upon the termination of this subpart, the Board shall recommend 
not more than five of its members to the Department to serve as trustees 
for the purpose of liquidating the affairs of the Board. Such persons, 
upon designation by the Department, shall become trustees of all of the 
funds and property then in the possession or under control of the Board, 
including claims for any funds unpaid or property not delivered, or any 
other claim existing at the time of such termination.
    (b) The said trustees shall:
    (1) Continue in such capacity until discharged by the Department;
    (2) Carry out the obligations of the Board under any contracts or 
agreements entered into pursuant to the Order;
    (3) From time to time, account for all receipts and disbursements 
and deliver all property on hand, together with all

[[Page 57]]

books and records of the Board and the trustees, to such person or 
persons as the Department may direct; and
    (4) Upon request of the Department, execute such assignments or 
other instruments necessary and appropriate to vest in such persons 
title and right to all funds, property and claims vested in the Board or 
the trustees pursuant to the Order.
    (c) Any person to whom funds, property or claims have been 
transferred or delivered pursuant to the Order shall be subject to the 
same obligations imposed upon the Board and upon the trustees.
    (d) Any residual funds not required to defray the necessary expenses 
of liquidation shall be turned over to the Department to be disposed of, 
to the extent practical, to one or more mango industry organizations in 
the interest of continuing mango promotion, research, and information 
programs.



Sec. 1206.74  Effect of termination or amendment.

    Unless otherwise expressly provided by the Department, the 
termination or amendment of this part or any subpart thereof, shall not:
    (a) Affect or waive any right, duty, obligation or liability which 
shall have arisen or which may thereafter arise in connection with any 
provision of this part; or
    (b) Release or extinguish any violation of this part; or
    (c) Affect or impair any rights or remedies of the United States, or 
of the Department, or of any other persons with respect to any such 
violation.



Sec. 1206.75  Personal liability.

    No member or employee of the Board shall be held personally 
responsible, either individually or jointly with others, in any way 
whatsoever, to any person for errors in judgment, mistakes, or other 
acts, either of commission or omission, as such member or employee, 
except for acts of dishonesty or willful misconduct.



Sec. 1206.76  Separability.

    If any provision of this subpart is declared invalid or the 
applicability thereof to any person or circumstances is held invalid, 
the validity of the remainder of this subpart or the applicability 
thereof to other persons or circumstances shall not be affected thereby.



Sec. 1206.77  Amendments.

    Amendments to this subpart may be proposed from time to time by the 
Board or by any interested person affected by the provisions of the Act, 
including the Department.



Sec. 1206.78  OMB control number.

    The control numbers assigned to the information collection 
requirements of this part by the Office of Management and Budget 
pursuant to the Paperwork Reduction Act of 1995, 44 U.S.C. chapter 35, 
are OMB control number 0505-0001 and OMB control number 0581-0209.



                    Subpart B_Referendum Procedures.



Sec. 1206.100  General.

    Referenda to determine whether eligible first handlers and importers 
of mangos favor the issuance, amendment, suspension, or termination of 
the Mango Promotion, Research, and Information Order shall be conducted 
in accordance with this subpart.



Sec. 1206.101  Definitions.

    (a) Administrator means the Administrator of the Agricultural 
Marketing Service, with power to redelegate, or any officer or employee 
of the U.S. Department of Agriculture to whom authority has been 
delegated or may hereafter be delegated to act in the Administrator's 
stead.
    (b) Department means the U.S. Department of Agriculture or any 
officer or employee of the Department to whom authority has heretofore 
been delegated, or to whom authority may hereafter be delegated, to act 
in the Secretary's stead.
    (c) Eligible first handler means any person, (excluding a common or 
contract carrier), receiving 500,000 or more pounds of mangos from 
producers in a calendar year and who as owner, agent, or otherwise ships 
or causes mangos to be shipped as specified in this Order. This 
definition includes those engaged in the business of buying, selling 
and/or

[[Page 58]]

offering for sale; receiving; packing; grading; marketing; or 
distributing mangos in commercial quantities. The term first handler 
includes a producer who handles or markets mangos of the producer's own 
production.
    (d) Eligible importer means any person importing 500,000 or more 
pounds of mangos into the United States in a calendar year as a 
principal or as an agent, broker, or consignee of any person who 
produces or handles mangos outside of the United States for sale in the 
United States, and who is listed as the importer of record for such 
mangos that are identified in the Harmonized Tariff Schedule of the 
United States by the numbers 0804.50.4040 and 0804.50.6040, during the 
representative period. Importation occurs when mangos originating 
outside of the United States are released from custody by the Customs 
and Border Protection and introduced into the stream of commerce in the 
United States. Included are persons who hold title to foreign-produced 
mangos immediately upon release by the Customs and Border Protection, as 
well as any persons who act on behalf of others, as agents or brokers, 
to secure the release of mangos from the Customs and Border Protection 
when such mangos are entered or withdrawn for consumption in the United 
States.
    (e) Mangos means all fresh fruit of Mangifera indica L. of the 
family Anacardiaceae.
    (f) Order means the Mango Promotion, Research, and Information 
Order.
    (g) Person means any individual, group of individuals, partnership, 
corporation, association, cooperative, or any other legal entity. For 
the purpose of this definition, the term ``partnership'' includes, but 
is not limited to:
    (1) A husband and a wife who have title to, or leasehold interest 
in, a mango farm as tenants in common, joint tenants, tenants by the 
entirety, or, under community property laws, as community property; and
    (2) So-called ``joint ventures'' wherein one or more parties to an 
agreement, informal or otherwise, contributed land and others 
contributed capital, labor, management, or other services, or any 
variation of such contributions by two or more parties.
    (h) Referendum agent or agent means the individual or individuals 
designated by the Department to conduct the referendum.
    (i) Representative period means the period designated by the 
Department.
    (j) United States or U.S. means collectively the 50 states, the 
District of Columbia, the Commonwealth of Puerto Rico, and the 
territories and possessions of the United States.



Sec. 1206.102  Voting.

    (a) Each eligible first handler and eligible importer of mangos 
shall be entitled to cast only one ballot in the referendum.
    (b) Proxy voting is not authorized, but an officer or employee of an 
eligible corporate first handler or importer, or an administrator, 
executor, or trustee or an eligible entity may cast a ballot on behalf 
of such entity. Any individual so voting in a referendum shall certify 
that such individual is an officer or employee of the eligible entity, 
or an administrator, executive, or trustee of an eligible entity and 
that such individual has the authority to take such action. Upon request 
of the referendum agent, the individual shall submit adequate evidence 
of such authority.
    (c) All ballots are to be cast by mail, as instructed by the 
Department.



Sec. 1206.103  Instructions.

    The referendum agent shall conduct the referendum, in the manner 
provided in this subpart, under the supervision of the Administrator. 
The Administrator may prescribe additional instructions, not 
inconsistent with the provisions of this subpart, to govern the 
procedure to be followed by the referendum agent. Such agent shall:
    (a) Determine the period during which ballots may be cast.
    (b) Provide ballots and related material to be used in the 
referendum. The ballot shall provide for recording essential 
information, including that needed for ascertaining whether the person 
voting, or on whose behalf the vote is cast, is an eligible voter.
    (c) Give reasonable public notice of the referendum:

[[Page 59]]

    (1) By utilizing available media or public information sources, 
without incurring advertising expense, to publicize the dates, places, 
method of voting, eligibility requirements, and other pertinent 
information. Such sources of publicity may include, but are not limited 
to, print and radio; and
    (2) By such other means as the agent may deem advisable.
    (d) Mail to eligible first handlers and importers whose names and 
addresses are known to the referendum agent, the instructions on voting, 
a ballot, and a summary of the terms and conditions of the proposed 
Order. No person who claims to be eligible to vote shall be refused a 
ballot.
    (e) At the end of the voting period, collect, open, number, and 
review the ballots and tabulate the results in the presence of an agent 
of a third party authorized to monitor the referendum process.
    (f) Prepare a report on the referendum.
    (g) Announce the results to the public.



Sec. 1206.104  Subagents.

    The referendum agent may appoint any individual or individuals 
necessary or desirable to assist the agent in performing such agent's 
functions of this subpart. Each individual so appointed may be 
authorized by the agent to perform any or all of the functions which, in 
the absence or such appointment, shall be performed by the agent.



Sec. 1206.105  Ballots.

    The referendum agent and subagents shall accept all ballots cast. 
However, if an agent or subagent deems that a ballot should be 
challenged for any reason, the agent or subagent shall endorse above 
their signature, on the ballot, a statement to the effect that such 
ballot was challenged, by whom challenged, the reasons therefore, the 
results of any investigations made with respect thereto, and the 
disposition thereof. Ballots invalid under this subpart shall not be 
counted.



Sec. 1206.106  Referendum report.

    Except as otherwise directed, the referendum agent shall prepare and 
submit to the Administrator a report on the results of the referendum, 
the manner in which it was conducted, the extent and kind of public 
notice given, and other information pertinent to the analysis of the 
referendum and its results.



Sec. 1206.107  Confidential information.

    The ballots and other information or reports that reveal, or tend to 
reveal, the vote of any person covered under the Order and the voter 
list shall be strictly confidential and shall not be disclosed.



Sec. 1206.108  OMB control number.

    The control number assigned to the information collection 
requirement in this subpart by the Office of Management and Budget 
pursuant to the Paperwork Reduction Act of 1995, 44 U.S.C. Chapter 35 is 
OMB control number 0581-0209.



PART 1207_POTATO RESEARCH AND PROMOTION PLAN--Table of Contents




               Subpart_Potato Research and Promotion Plan

                               Definitions

Sec.
1207.301 Secretary.
1207.302 Act.
1207.303 Plan.
1207.304 Person.
1207.305 Producer.
1207.306 Potatoes.
1207.307 Handle.
1207.308 Handler.
1207.309 Board.
1207.310 Fiscal period and marketing year.
1207.311 Programs and projects.
1207.312 Importer.
1207.313 Customs Service.

                     National Potato Promotion Board

1207.320 Establishment and membership.
1207.321 Term of office.
1207.322 Nominations and appointment.
1207.323 Acceptance.
1207.324 Vacancies.
1207.325 Procedure.
1207.326 Compensation and reimbursement.
1207.327 Powers.
1207.328 Duties.

                         Research and Promotion

1207.335 Research and promotion.

                        Expenses and Assessments

1207.341 Budget and expenses.

[[Page 60]]

1207.342 Assessments.
1207.343 [Reserved]
1207.344 Operating reserve.

                       Reports, Books, and Records

1207.350 Reports.
1207.351 Books and records.
1207.352 Confidential treatment.

                              Miscellaneous

1207.360 Influencing governmental action.
1207.361 Right of the Secretary.
1207.362 Suspension or termination.
1207.363 Proceedings after termination.
1207.364 Effect of termination or amendment.
1207.365 Personal liability.
1207.366 Separability.

                      Subpart_Rules and Regulations

                               Definitions

1207.500 Definitions.

                                 General

1207.501 Communications.
1207.502 Determination of membership.
1207.503 Nominations.
1207.504 Term of office.
1207.505 Procedure.
1207.506 Policy.
1207.507 Administrative Committee.
1207.508 USDA costs.

                               Assessments

1207.510 Levy of assessments.
1207.511 Determination of assessable quantity.
1207.512 Designated handler.
1207.513 Payment of assessments.
1207.514 [Reserved]
1207.515 Safeguards.

                                 Records

1207.532 Retention period for records.
1207.533 Availability of records.
1207.534 OMB control number assigned pursuant to the Paperwork Reduction 
          Act.

                        Confidential Information

1207.540 Confidential books, records, and reports.
1207.545 Right of the Secretary.
1207.546 Personal liability.

    Authority: 7 U.S.C. 2611-2627.



               Subpart_Potato Research and Promotion Plan

    Source: 37 FR 5008, Mar. 9, 1972, unless otherwise noted.

                               Definitions



Sec. 1207.301  Secretary.

    Secretary means the Secretary of Agriculture of the United States, 
or any officer or employee of the Department to whom authority has 
heretofore been delegated, or to whom authority may hereafter be 
delegated, to act in his stead.



Sec. 1207.302  Act.

    Act means the Potato Research and Promotion Act, Title III of Public 
Law 91-670, 91st Congress, approved January 11, 1971, 84 Stat. 2041, as 
amended.

[56 FR 40229, Aug. 14, 1991]



Sec. 1207.303  Plan.

    Plan means this potato research and promotion plan issued by the 
Secretary pursuant to the act.



Sec. 1207.304  Person.

    Person means any individual, partnership, corporation, association, 
or other entity.



Sec. 1207.305  Producer.

    Producer means any person engaged in the growing of 5 or more acres 
of potatoes who owns or shares the ownership and risk of loss of such 
potato crop.



Sec. 1207.306  Potatoes.

    Potatoes means any or all varieties of Irish potatoes grown by 
producers in the 50 states of the United States and grown in foreign 
countries and imported into the United States.

[56 FR 40229, Aug. 14, 1991]



Sec. 1207.307  Handle.

    Handle means to grade, pack, process, sell, transport, purchase, or 
in any other way to place potatoes or cause potatoes to be placed in the 
current of commerce. Such term shall not include the transportation or 
delivery of field-run potatoes by the producer thereof to a handler for 
grading, storage, or processing.



Sec. 1207.308  Handler.

    Handler means any person (except a common or contract carrier of 
potatoes

[[Page 61]]

owned by another person) who handles potatoes, including a producer who 
handles potatoes of his own production.



Sec. 1207.309  Board.

    Board means the National Potato Promotion Board, hereinafter 
established pursuant to Sec. 1207.320.



Sec. 1207.310  Fiscal period and marketing year.

    Fiscal period and marketing year mean the 12-month period from July 
1 through June 30 of the following year or such other period which may 
be approved by the Secretary.



Sec. 1207.311  Programs and projects.

    Programs and projects mean those research, development, advertising 
or promotion programs or projects developed by the Board pursuant to 
Sec. 1207.335.



Sec. 1207.312  Importer.

    Importer means any person who imports tablestock, frozen or 
processed potatoes for ultimate consumption by humans, or seed potatoes 
into the United States.

[56 FR 40229, Aug. 14, 1991]



Sec. 1207.313  Customs Service.

    Customs Service means the United States Customs Service of the 
United States Department of the Treasury.

[56 FR 40229, Aug. 14, 1991]

                     National Potato Promotion Board



Sec. 1207.320  Establishment and membership.

    (a) There is hereby established a National Potato Promotion Board, 
hereinafter called the ``Board'', composed of producers, importers, and 
a public member appointed by the Secretary. Producer members shall be 
appointed from nominations submitted by producers in the various States 
or groups of States pursuant to Sec. 1207.322. Importer members shall 
be appointed from nominations submitted by importers pursuant to Sec. 
1207.322. The public member shall be nominated by Board members in such 
manner as recommended by the Board and approved by the Secretary, and 
shall be appointed by the Secretary.
    (b) Producer membership upon the Board shall be determined on the 
basis of the potato production reported in the latest Crop Production 
Annual Summary Report issued by the Crop Reporting Board, U.S. 
Department of Agriculture. Unless the Secretary, upon recommendation of 
the Board, determines an alternate basis, for each five million 
hundredweight of such production, or major fraction thereof, produced 
within each State, such State shall be entitled to one member. However, 
each State shall initially be entitled to at least one member.
    (c) The number of importer member positions on the Board shall be 
based on the hundredweights of potatoes, potato products equivalent to 
fresh potatoes, and seed potatoes imported into the United States but 
shall not exceed five importer members. Unless the Secretary, upon 
recommendation of the Board, determines an alternate basis, there shall 
be one importer member position for each 5 million hundredweight, or 
major fraction thereof, of potatoes, potato product equivalents, and 
seed potatoes imported into the United States.
    (d) Any State in which the potato producers fail to respond to an 
officially called nomination meeting may be combined with an adjacent 
State for the purpose of representation on the Board, in which case the 
Board's producer member selected by the Secretary will represent both 
States, but such member's voting power under Sec. 1207.325 shall not be 
increased.
    (e) The Secretary, upon recommendation of the Board, may establish, 
through rule making procedure, districts or groups of States in order to 
change the representation requirements for membership on the Board. In 
such event the voting power of members under Sec. 1207.325 would be 
based upon the total production within the new district or group of 
States.
    (f) Should the Board fail to nominate a public member, the Secretary 
may appoint such member.

[37 FR 5008, Mar. 9, 1972, as amended at 49 FR 20806, May 17, 1984; 49 
FR 31390, Aug. 7, 1984; 56 FR 40229, Aug. 14, 1991]

[[Page 62]]



Sec. 1207.321  Term of office.

    (a) The term of office of Board members shall be 3 years, beginning 
July 1, or such other beginning date as may be approved pursuant to 
regulations.
    (b) The terms of office of the Board's producer members shall be so 
determined that approximately one-third of the terms will expire each 
year. Importer and public member terms shall run concurrently. All 
members serving on the Board on the effective date of this amendment to 
the Plan shall continue serving the term to which they were appointed.
    (c) Board members shall serve during the term of office for which 
they are selected and have qualified, and until their successors are 
selected and have qualified.
    (d) No member shall serve for more than two full successive terms of 
office.

[37 FR 5008, Mar. 9, 1972, as amended at 56 FR 40229, Aug. 14, 1991]



Sec. 1207.322  Nominations and appointment.

    The Secretary shall select the producer, importer, and public 
members of the Board from nominations which may be made in the following 
manner.
    (a) A meeting or meetings of producers shall be held in each State 
to nominate producer members for the Board. For nominations to the 
initial Board the meetings shall be announced by the U.S. Department of 
Agriculture. The Department may call upon other organizations to assist 
in conducting the meetings such as State and national organizations of 
potato producers. Such nomination meetings shall be held not later than 
60 days after the issuance of this subpart. Any organization designated 
to hold such nomination meetings shall give adequate notice of such 
meetings to the potato producers affected; also to the Secretary so that 
a representative of the Secretary, if available, may conduct such 
meetings or act as secretary of such nomination meetings.
    (b) After the establishment of the initial Board, the nominations 
for subsequent Board producer members shall be made by producers at 
meetings in the producing sections or States. The Board shall hold such 
meetings, or cause them to be held, in accordance with rules established 
pursuant to recommendation of the Board.
    (c) Only producers may participate in designating producer nominees. 
Each producer is entitled to one vote only on behalf of himself, his 
partners, agents, subsidiaries, affiliates, and representatives for each 
position for which nominations are being held. If a producer is engaged 
in producing potatoes in more than one State, he shall elect the State 
in which he shall vote. In no event shall he vote in nominations in more 
than one meeting.
    (d) The importer members shall be nominated by importers of 
potatoes, potato products and/or seed potatoes. The number of importer 
members on the Board shall be announced by the Secretary and shall not 
exceed five members. The Board may call upon organizations of potato, 
potato products and/or seed potato importers to assist in nominating 
importers for membership on the Board. If such organizations fail to 
submit nominees or are determined by the Board to not adequately 
represent importers, then the Board may conduct meetings of importers to 
nominate eligible importers for Board member positions. In determining 
if importer organizations adequately represent importers, the Board 
shall consider:
    (1) How many importers belong to the association;
    (2) What percentage of the total number of importers is represented 
by the association;
    (3) Is the association representative of the potato, potato product, 
and seed potato import industry;
    (4) Does the association speak for potato, potato product, and seed 
potato importers; and
    (5) Other relevant information as may be warranted.
    (e) The public member shall be nominated by the producer and 
importer members of the Board. The public member shall have no direct 
financial interest in the commercial production or marketing of potatoes 
except as a consumer and shall not be a director, stockholder, officer 
or employee of any firm so engaged. The Board shall prescribe such 
additional qualifications,

[[Page 63]]

administrative rules and procedures for selection and voting for each 
candidate as it deems necessary and the Secretary approves.

[37 FR 5008, Mar. 9, 1972, as amended at 49 FR 20806, May 17, 1984; 56 
FR 40229, Aug. 14, 1991]

    Effective Date Note: At 62 FR 46179, Sept. 2, 1997, in Sec. 
1207.322, paragraphs (a) and (d)(1) through (d)(5); in paragraph (b), 
the words ``at meetings'' in the first sentence and the entire last 
sentence; in paragraph (c), the last sentence; and in paragraph (d), the 
last two sentences of the introductory text were suspended, effective 
Sept. 3, 1997.



Sec. 1207.323  Acceptance.

    Each person selected by the Secretary as a member of the Board shall 
qualify by filing a written acceptance with the Secretary promptly after 
being notified of such selection.



Sec. 1207.324  Vacancies.

    To fill any vacancy caused by the failure of any person selected as 
a member of the Board to qualify, or in the event of the death, removal, 
resignation, or disqualification of any member, a successor shall be 
nominated and selected in the manner specified in Sec. 1207.322. In the 
event of failure to provide nominees for such vacancies, the Secretary 
may select other eligible persons.



Sec. 1207.325  Procedure.

    (a) Each State (or district or group of States established pursuant 
to Sec. 1207.320) which has a member on the Board shall be entitled to 
not less than one vote for any production up to 1 million hundredweight, 
plus one additional vote for each additional 1 million hundredweight of 
production, or major fraction thereof, as determined by the latest crop 
production annual summary report issued by the Crop Reporting Board, 
U.S. Department of Agriculture. The casting of the votes for each State 
shall be determined by the members of the Board from that State.
    (b) A majority of the Board members shall constitute a quorum and 
any action of the Board shall require a majority of concurring votes of 
those present and voting. At assembled meetings all votes shall be cast 
in person or by duly authorized proxy.
    (c) For routine and noncontroversial matters which do not require 
deliberation and the exchange of views, and for matters of an emergency 
nature when there is not enough time to call an assembled meeting, the 
Board may act upon a majority of concurring votes of its members cast by 
mail, telegraph, or telephone. Any vote cast by telephone shall be 
confirmed promptly in writing.

[37 FR 5008, Mar. 9, 1972, as amended at 57 FR 40083, Sept. 2, 1992]



Sec. 1207.326  Compensation and reimbursement.

    Members of the Board shall serve without compensation but shall be 
reimbursed for reasonable expenses incurred by them in the performance 
of their duties as members of the Board.



Sec. 1207.327  Powers.

    The Board shall have the following powers subject to Sec. 1207.361:
    (a) To administer the provisions of this plan in accordance with its 
terms and conditions;
    (b) To make rules and regulations to effectuate the terms and 
conditions of this plan;
    (c) To receive, investigate, and report to the Secretary complaints 
of violations of this plan; and
    (d) To recommend to the Secretary amendments to this plan.



Sec. 1207.328  Duties.

    The Board shall, among other things, have the following duties:
    (a) To meet and organize and to select from among its members a 
president and such other officers as may be necessary; to select 
committees and subcommittees of Board members to nominate the public 
member; to adopt such rules for the conduct of its business as it may 
deem advisable; and it may establish advisory committees of persons 
other than Board members;
    (b) To employ such persons as it may deem necessary and to determine 
the compensation and define the duties of each; and to protect the 
handling of Board funds through fidelity bonds;
    (c) At the beginning of each fiscal period, to prepare and submit to 
the Secretary for his approval a budget on a fiscal period basis of the 
anticipated expenses in the administration of this

[[Page 64]]

plan including the probable costs of all programs or projects and to 
recommend a rate of assessment with respect thereto;
    (d) To develop programs and proj ects and to enter into contracts or 
agreements for the development and carrying out of programs or projects 
of research, development, advertising or promotion, and the payment of 
the costs thereof with funds collected pursuant to this plan;
    (e) To keep minutes, books, and rec ords which clearly reflect all 
of the acts and transactions of the Board. Minutes of each Board meeting 
shall be promptly reported to the Secretary;
    (f) To cause the books of the Board to be audited by a certified 
public accountant at least once each fiscal period, and at such other 
time as the Board may deem necessary. The report of such audit shall 
show the receipt and expenditure of funds collected pursuant to this 
part. Two copies of each such report shall be furnished to the Secretary 
and a copy of each such report shall be made available at the principal 
office of the Board for inspection by producers, handlers, and 
importers;
    (g) To give the Secretary the same notice of meetings of the Board 
and its subcommittees as is given to its members;
    (h) To act as intermediary between the Secretary and any producer, 
handler, or importer;
    (i) To furnish the Secretary such information as he may request.
    (j) To prepare and submit to the Secretary such reports from time to 
time as may be prescribed by the Secretary for appropriate accounting 
with respect to the receipt and disbursement of funds entrusted to the 
Board; and

[37 FR 5008, Mar. 9, 1972, as amended at 49 FR 20806, May 17, 1984; 56 
FR 40230, Aug. 14, 1991; 57 FR 40083, Sept. 2, 1992]

                         Research and Promotion



Sec. 1207.335  Research and promotion.

    The Board shall develop and submit to the Secretary for approval any 
programs or projects authorized in this section. Such programs or 
projects shall provide for:
    (a) The establishment, issuance, effectuation and administration of 
appropriate programs or projects for the advertising and promotion of 
potatoes and potato products: Provided, however, That any such program 
or project shall be directed toward increasing the general demand for 
potatoes and potato products;
    (b) Establishing and carrying on research and development projects 
and studies to the end that the marketing and utilization of potatoes 
may be encouraged, expanded, improved, or made more efficient: Provided, 
That quality control, grade standards and supply management programs 
shall not be conducted under, or as a part of, this plan; and
    (c) The development and expansion of potato and potato product sales 
in foreign markets.
    (d) No advertising or promotion program shall make any reference to 
private brand names or use false or unwarranted claims in behalf of 
potatoes or their products or false or unwarranted statements with 
respect to the attributes or use of any competing products.

                        Expenses and Assessments



Sec. 1207.341  Budget and expenses.

    (a) At the beginning of each fiscal period, or as may be necessary 
thereafter, the Board shall prepare and recommend a budget on a fiscal 
period basis of its anticipated expenses and disbursements in the 
administration of this plan, including probable costs of research, 
development, advertising, and promotion. The Board shall also recommend 
a rate of assessment calculated to provide adequate funds to defray its 
proposed expenditures and to provide for a reserve as set forth in Sec. 
1207.344.
    (b) The Board is authorized to incur such expenses for research, 
development, advertising, or promotion of potatoes and potato products, 
such other expenses for the administration, maintenance, and functioning 
of the Board, and any referendum and administrative costs incurred by 
the Department of

[[Page 65]]

Agriculture as are approved pursuant to Sec. 1207.361.

[37 FR 5008, Mar. 9, 1972, as amended at 49 FR 20806, May 17, 1984]



Sec. 1207.342  Assessments.

    (a) The funds to cover the Board's expenses shall be acquired by the 
levying of assessments upon handlers and importers as designated in 
regulations recommended by the Board and issued by the Secretary. Such 
assessments shall be levied at a rate fixed by the Secretary which shall 
not exceed one-half of one per centum of the immediate past ten calendar 
years United States average price received for potatoes by growers as 
reported by the Department of Agriculture and not more than one such 
assessment may be collected on any potatoes.
    (b) Each designated handler, as specified in regulations, shall pay 
assessments to the Board on all potatoes handled by him, including 
potatoes he produced. Assessments shall be paid to the Board at such 
time and in such manner as the Board shall direct pursuant to 
regulations issued hereunder. The designated handler may collect the 
assessments from the producer, or deduct such assessments from the 
proceeds paid to the producer on whose potatoes the assessments are 
made, provided he furnishes the producer with evidence of such payment.
    (c) The importer of imported potatoes, potato products, or seed 
potatoes shall pay the assessment to the Board at the time of entry, or 
withdrawal, for consumption of such potatoes and potato products into 
the United States.
    (d) The assessment on imported tablestock potatoes and frozen or 
processed potato products for ultimate consumption by humans and on seed 
potatoes shall be established by the Board so that the effective 
assessment shall be equal to that on domestic production.
    (e) The Board may authorize other organizations to collect 
assessments in its behalf.
    (f) The Board may exempt potatoes used for nonfood purposes, other 
than seed, from the provisions of this plan and shall establish adequate 
safeguards against improper use of such exemptions.

[37 FR 5008, Mar. 9, 1972, as amended at 49 FR 20806, May 17, 1984; 56 
FR 40230, Aug. 14, 1991]



Sec. 1207.343  [Reserved]



Sec. 1207.344  Operating reserve.

    The Board may establish an operating monetary reserve and may carry 
over to subsequent fiscal periods excess funds in a reserve so 
established: Provided, That funds in the reserve shall not exceed 
approximately two fiscal periods' expenses. Such reserve funds may be 
used to defray any expenses authorized under this part.

                       Reports, Books, and Records



Sec. 1207.350  Reports.

    (a) Each designated handler shall maintain a record with respect to 
each producer for whom he handled potatoes and for potatoes handled 
which he himself produced. He shall report to the Board at such times 
and in such manner as it may prescribe by regulations such information 
as may be necessary for the Board to perform its duties under this part. 
Such reports may include, but shall not be limited to, the following:
    (1) Total quantity of potatoes handled for each producer and for 
himself, including those which are exempt under the plan;
    (2) Total quantity of potatoes handled for each producer and for 
himself subject to the plan and assessments, and
    (3) Name and address of each person from whom he collected an 
assessment, the amount collected from each person, and the date such 
collection was made.
    (b) Each importer shall report to the Board at such times and in 
such manner as it may prescribe such information as may be necessary for 
the Board to perform its duties under this part.

[37 FR 5008, Mar. 9, 1972, as amended at 56 FR 40230, Aug. 14, 1991]



Sec. 1207.351  Books and records.

    Each handler or importer subject to this part shall maintain and 
make available for inspection by authorized employees of the Board and 
the Secretary such books and records as are

[[Page 66]]

appropriate and necessary to carry out the provisions of this Plan and 
the regulations issued thereunder, including such records as are 
necessary to verify any reports required. Such records shall be 
maintained for at least 2 years beyond the marketing year of their 
applicability.

[37 FR 5008, Mar. 9, 1972, as amended at 56 FR 40230, Aug. 14, 1991]



Sec. 1207.352  Confidential treatment.

    All information obtained from books, records, or reports required 
pursuant to this part shall be kept confidential by all employees of the 
Department of Agriculture and of the Board, and by all contractors and 
agents retained by the Board, and only such information so furnished or 
acquired as the Secretary deems relevant shall be disclosed by them, and 
then only in a suit or administrative hearing brought at the direction, 
or upon the request, of the Secretary, or to which the Secretary or any 
officer of the United States is a party, and involving this Plan. 
Nothing in this section shall be deemed to prohibit:
    (a) The issuance of general statements based upon the reports of a 
number of handlers or importers subject to this Plan, which statements 
do not identify the information furnished by any person; or
    (b) The publication by direction of the Secretary of the name of any 
person violating this Plan, together with a statement of the particular 
provisions of this Plan violated by such person.

[56 FR 40230, Aug. 14, 1991]

                              Miscellaneous



Sec. 1207.360  Influencing governmental action.

    No funds collected by the Board under this plan shall in any matter 
be used for the purpose of influencing governmental policy or action 
except in recommending to the Secretary amendments to this subpart.



Sec. 1207.361  Right of the Secretary.

    All fiscal matters, programs or proj ects, rules or regulations, 
reports, or other substantive action proposed and prepared by the Board 
shall be submitted to the Secretary for his approval.



Sec. 1207.362  Suspension or termination.

    (a) The Secretary shall, whenever he finds that this plan or any 
provision thereof obstructs or does not tend to effectuate the declared 
policy of the act, terminate or suspend the operation of this plan or 
such provision thereof.
    (b) The Secretary may conduct a referendum at any time, and shall 
hold a referendum on request of the Board or of 10 percent or more of 
the potato producers and importers to determine whether potato producers 
and importers favor termination or suspension of this plan. The 
Secretary shall suspend or terminate such plan at the end of the 
marketing year whenever the Secretary determines that its suspension or 
termination is favored by a majority of the potato producers and 
importers voting in such referendum who, during a representative period 
determined by the Secretary, have been engaged in the production or 
importation of potatoes or potato products, and who produced or imported 
more than 50 percent of the volume of the potatoes or potato products 
produced or imported by the producers and importers voting in the 
referendum.

[37 FR 5008, Mar. 9, 1972, as amended at 56 FR 40230, Aug. 14, 1991]



Sec. 1207.363  Proceedings after termination.

    (a) Upon the termination of this plan, the Board shall recommend not 
more than five of its members to the Secretary to serve as trustees for 
the purpose of liquidating the affairs of the Board. Such persons, upon 
designation by the Secretary, shall become trustees of all funds and 
property then in the possession or under control of the Board including 
claims for any funds unpaid or property not delivered or any other claim 
existing at the time of such termination.
    (b) The said trustees shall (1) continue in such capacity until 
discharged by the Secretary; (2) carry out the obligations of the Board 
under any contracts or agreements entered into by it pursuant to this 
plan; (3) account for

[[Page 67]]

all receipts and disbursements and deliver all property on hand, 
together with all books and records of the Board and of the trustees, to 
such person or persons as the Secretary may direct; and (4) upon the 
request of the Secretary execute such assignments or other instruments 
necessary or appropriate to vest in such person or persons full title 
and right to all of the funds, property, and claims vested in the Board 
of the trustees pursuant to this section.
    (c) Any person to whom funds, property, or claims have been 
transferred or delivered pursuant to this section shall be subject to 
the same obligation imposed upon the Board and upon the trustee.
    (d) A reasonable effort shall be made by the Board or its trustees 
to return to producers and importers any residual funds not required to 
defray the necessary expenses of liquidation. If it is found impractical 
to return such remaining funds to producers and importers, such funds 
shall be disposed of in such manner as the Secretary may determine to be 
appropriate.

[37 FR 5008, Mar. 9, 1972, as amended at 56 FR 40231, Aug. 14, 1991]



Sec. 1207.364  Effect of termination or amendment.

    Unless otherwise expressly provided by the Secretary, the 
termination of this plan or of any regulation issued pursuant thereto, 
or the issuance of any amendment to either thereof, shall not (a) affect 
or waive any right, duty, obligation, or liability which shall have 
arisen or which may thereafter arise in connection with any provision of 
this plan or any regulation issued thereunder, or (b) release or 
extinguish any violation of this plan or any regulation issued 
thereunder, or (c) affect or impair any rights or remedies of the United 
States, or of the Secretary, or of any other person, with respect to any 
such violation.



Sec. 1207.365  Personal liability.

    No member of the Board shall be held personally responsible, either 
individually or jointly with others, in any way whatsoever to any person 
for errors in judgments, mistakes, or other acts, either of commission 
or omission, as such member except for acts of willful misconduct, gross 
negligence, or those which are criminal in nature.



Sec. 1207.366  Separability.

    If any provision of this plan is declared invalid or the 
applicability thereof to any person or circumstance is held invalid, the 
validity of the remainder of this plan or applicability thereof to other 
persons or circumstances shall not be affected thereby.



                      Subpart_Rules and Regulations

    Source: 37 FR 17379, Aug. 26, 1972, unless otherwise noted.

                               Definitions



Sec. 1207.500  Definitions.

    (a) Unless otherwise defined in this subpart, definitions of terms 
used in this subpart shall have the same meaning as the definitions of 
such terms which appear in Subpart--Potato Research and Promotion Plan.
    (b) Processor. Processor means any person who commercially processes 
potatoes into potato products, including, but not restricted to, frozen, 
dehydrated, or canned potato products, potato chips and shoestrings, and 
flour.
    (c) Imported frozen or processed potatoes for ultimate consumption 
by humans. Imported frozen or processed potatoes for ultimate 
consumption by humans means products which are imported into the United 
States which the Secretary determines contain a substantial amount of 
potato.

[37 FR 17379, Aug. 26, 1972, as amended at 56 FR 40231, Aug. 14, 1991; 
57 FR 40083, Sept. 2, 1992]

                                 General



Sec. 1207.501  Communications.

    All communications in connection with the Potato Research and 
Promotion Plan shall be addressed to: National Potato Promotion Board, 
7555 East Hampden Avenue, Suite 412, Denver, Colorado 80231.

[59 FR 44036, Aug. 26, 1994]

[[Page 68]]



Sec. 1207.502  Determination of membership.

    (a) Pursuant to Sec. 1207.320 and the recommendation of the Board, 
annual producer memberships on the Board shall be determined on the 
basis of the average potato production of the 3 preceding years in each 
State as set forth in the Crop Production Annual Summary Reports issued 
by the Crop Reporting Board of the U.S. Department of Agriculture.
    (b) Pursuant to Sec. 1207.320 and the recommendation of the Board, 
annual importer memberships on the Board shall be determined on the 
basis of the average potato, potato product, and seed potato importation 
of the 3 preceding years as determined by the Board's records.

[56 FR 40231, Aug. 14, 1991]



Sec. 1207.503  Nominations.

    (a) Pursuant to Sec. 1207.322 of the plan, the Board shall assist 
producers in producing sections or States each year to nominate producer 
members for the Board. Such nominations may be conducted at meetings or 
by mail ballots. One individual shall be nominated for each position to 
become vacant. A list of nominees shall be submitted to the Secretary 
for consideration by November 1 of each year.
    (b) Pursuant to Sec. 1207.322 of the plan, the Board shall assist 
importers each year to nominate importer members for the Board. Such 
nominations may be conducted at meetings or by mail ballots.
    (c) Nomination meetings or mail balloting shall be well publicized 
with notice given to producers, importers, and the Secretary at least 10 
days prior to each meeting or mailing of ballots.
    (d) The public member shall be nominated by the producer and 
importer members of the Board.

[37 FR 17379, Aug. 26, 1972, as amended at 49 FR 2093, Jan. 18, 1984; 56 
FR 40231, Aug. 14, 1991; 62 FR 46179, Sept. 2, 1997]



Sec. 1207.504  Term of office.

    (a) The term of office of Board members shall be for three years and 
shall begin March 1 and end on the last day of February.
    (b) Board members shall serve during the term of office for which 
they are selected and have qualified and until their successors are 
selected and have qualified.

[38 FR 7123, Mar. 16, 1973, as amended at 49 FR 2093, Jan. 18, 1984]



Sec. 1207.505  Procedure.

    (a) The procedure for conducting the Board's meetings shall be in 
accordance with the bylaws adopted by the Board on June 7, 1972, and 
approved by the Secretary and any subsequent amendments adopted by the 
Board and approved by the Secretary.
    (b) Each importer member shall be entitled to not less than one 
vote. Importer members shall also be entitled to one additional vote for 
each 1 million hundredweight, or major fraction thereof, on a fresh-
weight basis, of imported tablestock potatoes, potato products, or seed 
potatoes, as determined by data on imports provided by the U.S. 
Department of Agriculture. The casting of such votes shall be determined 
by the importer members.

[62 FR 46179, Sept. 2, 1997]



Sec. 1207.506  Policy.

    (a) It shall be the policy of the Board to carry out an effective 
and continuous coordinated program of marketing research, development, 
advertising, and promotion in order to help maintain and expand existing 
domestic and foreign markets for potatoes and to develop new or improved 
markets.
    (b) It shall be the objective of the Board to carry out programs and 
proj ects which will provide maximum benefit to the potato industry and 
no undue preference shall be given to any of the various industry 
segments.



Sec. 1207.507  Administrative Committee.

    (a) The Board shall annually select from among its members an 
Administrative Committee composed of producer members as provided for in 
the Board's bylaws, one or more importer members, and the public member. 
Selection shall be made in such manner as the Board may prescribe: 
Except that such committee shall include the Chairperson and six Vice-
Chairpersons,

[[Page 69]]

one of whom shall also serve as the Secretary and Treasurer of the 
Board.
    (b) The Administrative Committee shall act for the Board in 
implementing such marketing research, development, advertising, and/or 
promotion activities as directed by the Board, and shall, subject to 
such direction, be charged with developing and submitting to the 
Secretary for his approval specific programs or projects in the name of 
the Board. The Administrative Committee shall further act for the Board 
in authorizing contracts or agreements for the development and carrying 
out of such programs or projects and the payment of the costs thereof 
with funds collected pursuant to Sec. 1207.342 of the plan.
    (1) The Administrative Committee also shall act for the Board in 
contracting with cooperating agencies for the collection of assessments 
pursuant to Sec. 1207.513(d).
    (2) [Reserved]
    (c) The Board may assign such other administrative powers and duties 
to the Administrative Committee as it shall determine, and the 
Administrative Committee shall act on behalf of and in the name of the 
Board in all administrative matters.

[37 FR 17379, Aug. 26, 1972, as amended by Amdt. 6, 42 FR 55879, Oct. 
20, 1977; 44 FR 25621, May 2, 1979; 50 FR 25199, June 18, 1985; 56 FR 
40231, Aug. 14, 1991; 59 FR 44036, Aug. 26, 1994]



Sec. 1207.508  USDA costs.

    Pursuant to Sec. 1207.341 of the Plan the Board shall pay those 
administrative costs incurred by the U.S. Department of Agriculture for 
the conduct of its duties under the Plan as are determined periodically 
by the Secretary. Payment shall be due promptly after billing for such 
costs.

[49 FR 26202, June 27, 1984]

                               Assessments



Sec. 1207.510  Levy of assessments.

    (a) Domestic assessments. (1) An assessment rate of 2 cents per 
hundredweight shall be levied on all potatoes produced within the 50 
States of the United States.
    (2) No assessment shall be levied on potatoes grown in the 50 States 
of the United States by producers of less than 5 acres of potatoes.
    (b) Assessments on imports. (1) An assessment rate of 2 cents per 
hundredweight shall be levied on all tablestock potatoes imported into 
the United States for ultimate consumption by humans and all seed 
potatoes imported into the United States. An assessment rate of 2 cents 
per hundredweight shall be levied on the fresh weight equivalents of 
imported frozen or processed potatoes for ultimate consumption by 
humans. The importer of imported tablestock potatoes, potato products, 
or seed potatoes shall pay the assessment to the Board through the U.S. 
Customs Service at the time of entry or withdrawal for consumption of 
such potatoes and potato products into the United States.
    (2) The following conversion factors shall be used to determine the 
fresh weight equivalents of frozen and processed potato products:

Frozen potato products..........................................   .50
Canned potatoes.................................................   .636
Potato chips and shoestring potatoes............................   .245
Dehydrated potato products......................................   .14
Potato starch...................................................   .1111
 

    (3) The Harmonized Tariff Schedule (HTS) categories and assessment 
rates on imported tablestock potatoes and frozen or processed potatoes 
for ultimate consumption by humans and on imported seed potatoes are as 
follows:

------------------------------------------------------------------------
                                                         Assessment
  Tablestock potatoes, processed potato products,  ---------------------
                 and seed potatoes                  Cents/cwt   Cents/kg
------------------------------------------------------------------------
0701.10.0020......................................       2.00     0.0441
0701.10.0040......................................       2.00     0.0441
0701.90.1000......................................       2.00     0.0441
0701.90.5010......................................       2.00     0.0441
0701.90.5020......................................       2.00     0.0441
0701.90.5030......................................       2.00     0.0441
0701.90.5040......................................       2.00     0.0441
0710.10.0000......................................       4.00     0.0882
2004.10.4000......................................       4.00     0.0882
2004.10.8020......................................       4.00     0.0882
2004.10.8040......................................       4.00     0.0882
2005.20.6060......................................     3.1446     0.0693
0712.10.0000......................................    14.2857     0.3149
1105.10.0000......................................    14.2857     0.3149
1105.20.0000......................................    14.2857     0.3149
2005.20.6040......................................    14.2857     0.3149
2005.20.2000......................................     8.1633     0.1800
1108.13.0010......................................    18.0018     0.3969
------------------------------------------------------------------------

    (4) No assessments shall be levied on otherwise assessable potatoes 
which are contained in imported products wherein potatoes are not a 
principal ingredient.

[[Page 70]]

    (c) Potatoes and potato products used for nonhuman food purposes, 
other than seed, are exempt from assessment but are subject to the 
disposition of exempted potatoes provisions of Sec. 1207.515 of this 
subpart.
    (d) No more than one such assessment shall be made on any potatoes 
or potato products.

[57 FR 40083, Sept. 2, 1992, as amended at 58 FR 3359, Jan. 8, 1993; 59 
FR 44036, Aug. 26, 1994]



Sec. 1207.511  Determination of assessable quantity.

    The assessable quantity of potatoes in any lot shall be determined 
on the basis of utilization. Assessments shall be due on the entire lot 
handled for human consumption, seed, or unspecified purposes if there is 
no accounting made on the basis of the utilization of such lot. However, 
if the accounting identifies all or portions of such lot on the basis of 
utilization, assessments shall be due only on that portion utilized for 
human consumption and seed.



Sec. 1207.512  Designated handler.

    The assessment on each lot of potatoes produced in the 50 States of 
the United States and handled shall be paid by the designated handler as 
hereafter set forth.
    (a) Unless otherwise provided in paragraphs (a)(8), (b), and (c) of 
this section, the designated handler shall be the first handler of such 
potatoes. The first handler is the person who initially performs a 
handler function as heretofore defined. Such person may be a fresh 
shipper, processor, or other person who first places the potatoes in the 
channels of commerce. A producer who grades, packs, or otherwise 
performs handler functions thereby becomes a handler and as such assumes 
first handler responsibilities under this part. The following examples 
are provided to aid in identification of first handlers who are 
designated handlers:
    (1) Producer delivers field-run potatoes of his own production to a 
handler for preparation for market. The handler in this instance is the 
designated handler, regardless of whether he subsequently handles such 
potatoes for his own account or for the account of the producer.
    (2) Producer delivers field-run potatoes of his own production to a 
handler who takes title to such potatoes and places them in storage for 
subsequent handling. The handler who purchases such potatoes from the 
producer is the designated handler.
    (3) Producer delivers field-run potatoes to a commercial storage 
facility for the purpose of holding such potatoes under his own account 
for later sale. There is no designated handler in this instance since 
such potatoes have not been handled as heretofore defined and no 
assessment is due. The designated handler of such potatoes would be 
identified on the basis of subsequent handling of such potatoes.
    (4) Fresh shipper purchases a lot of potatoes from a producer, packs 
a portion of such potatoes for fresh market, and delivers the balance to 
a processor. The fresh shipper is the designated handler for all 
potatoes in the lot.
    (5) Handler purchases potatoes from a producer's field or storage 
for the purpose of preparing such potatoes for market or for 
transporting such potatoes to storage for subsequent handling. The 
handler who purchases such potatoes from the producer is the designated 
handler.
    (6) Producer packs and sells potatoes of his own production from the 
field, roadside stand, or storage to a consumer, itinerant trucker, or 
other buyer. In performing such handler functions the producer assumes 
the responsibility of designated handler.
    (7) Processor utilizes potatoes of his own production in the 
manufacture of potato chips, frozen, dehydrated, or canned products for 
human consumption. In so handling potatoes, the proc essor assumes the 
responsibility of designated handler.
    (8) Producer utilizes potatoes of his own production for seed in 
planting his subsequent crop. Such seed potatoes do not enter the 
current of commerce; there is no designated handler in this instance 
since the potatoes have not been handled as heretofore defined and no 
assessment is due. However, seed potatoes sold or shipped to other 
producers for planting or to other persons for subsequent disposition 
enter the current of commerce and are subject to

[[Page 71]]

assessment. The producer of seed potatoes shall be the designated 
handler of such potatoes shipped to other producers for planting and the 
assessment is due when he first sells or otherwise handles such 
potatoes. The first person who acquires seed potatoes from the producer 
thereof for subsequent disposition other than planting by said person 
shall be the designated handler of such potatoes. However, the seed 
producer will be the designated handler responsible for filing reports 
and making payments, unless he can show that the first person who 
obtained the potatoes from him disposed of them other than by planting. 
To show this the seed producer must submit to the Potato Board the name 
and address of the first person who obtained the potatoes from him and 
an invoice of sale or settlement sheet on which it is indicated that 
such person will be the designated handler and therefore will be 
responsible for the payment of the assessments. Only by showing this is 
the seed producer no longer considered the designated handler and 
therefore not liable for the assessments.
    (b) Any person who handles potatoes for a producer thereof under 
oral or written contract or agreement providing for the sale thereof 
shall be the designated handler for such potatoes, notwithstanding the 
fact that the producer may have graded, packed, or otherwise handled 
such potatoes and thereby became the first handler of such potatoes.
    Examples. A cooperative marketing association, or other person, who 
makes an accounting to the producer, or pay the proceeds of the sale to 
the producer would be the designated handler responsible for the 
assessment.
    (c) Any processor who purchases potatoes from the producer thereof 
shall be the designated handler even though the producer may have 
graded, packed, or otherwise handled such potatoes and thereby became 
the first handler of such potatoes.

[37 FR 17379, Aug. 26, 1972, as amended by Amdt. 4, 40 FR 7893, Feb. 24, 
1975; Amdt. 7, 43 FR 9133, Mar. 6, 1978; Amdt. 8, 43 FR 51001, Nov. 2, 
1978; 56 FR 40231, Aug. 14, 1991]



Sec. 1207.513  Payment of assessments.

    (a) Time of payment. The assessment on domestically produced 
potatoes shall become due at the time a determination of assessable 
potatoes is made in the normal handling process, pursuant to Sec. 
1207.511. If no determination is made of the utilization of a lot, 
assessments shall be due on the entire lot when it enters the current of 
commerce. The assessment on imported potatoes, potato products, and seed 
potatoes shall become due at the time of entry, or withdrawal, for 
consumption into the United States.
    (b) Responsibility for payment. (1) The designated handler is 
responsible for payment of the assessment on domestically produced 
potatoes. He may pay with no reimbursement from the producer. In the 
alternative, he may collect the assessment from the producer, or deduct 
such assessment from the proceeds paid to the producer on whose potatoes 
the assessment is made, provided he furnishes the producer with evidence 
of such payment. Any such collection or deduction of assessment shall be 
made not later than the time when the assessment becomes payable by the 
handler to the Board. Failure of the handler to collect or deduct such 
assessment does not relieve the handler of his obligation to remit the 
assessment to the Board.
    (2) The Customs Service shall collect payment of assessment on 
imported potatoes, potato products, and seed potatoes from importers and 
forward such assessment per agreement between the Customs Service and 
the U.S. Department of Agriculture. Importers shall be responsible for 
payment of assessment directly to the Board of any assessment due but 
not collected by the Customs Service at the time of entry, or 
withdrawal, for consumption into the United States. An importer may 
apply to the Board for reimbursement of assessments paid on exempted 
products.
    (c) Payment directly to the Board. (1) Except as provided in 
paragraphs (b) and (d) of this section, each designated handler or 
importer shall remit assessments directly to the Board by check, draft, 
or money order payable to the National Potato Promotion Board, or NPPB, 
not later than 10 days after the end of the month such assessment is due 
together with a report (preferably on Board forms) thereon.

[[Page 72]]

    (2) All designated handlers, including a designated handler whose 
own production is handled and assessments to the Board paid by another 
designated handler, shall report to the Board:
    (i) Date of report (which is also date of payment to the Board).
    (ii) The name and address of the designated handler;
    (iii) The period potatoes were handled;
    (iv) The total quantity of potatoes determined to be assessable 
during the period potatoes were handled, pursuant to Sec. 1207.511.
    (3) Designated handlers who collect assessments from producers or 
withhold assessments from their accounts or pay the assessment 
themselves shall also include a list of all such producers whose 
potatoes were handled during the period, their addresses and the total 
assessable quantities handled for each such producer.
    (i) In lieu of such a list, the designated handler may substitute 
authentic copies of settlement sheets given to each producer provided 
such settlement sheets contain all the information listed above.
    (ii) The words ``final report'' shall be shown on the last report at 
the close of his marketing season or at the end of each fiscal period if 
such handler markets potatoes on a year-round basis.
    (4) Prepayment of assessment: (i) In lieu of the monthly assessment 
and reporting requirements of paragraph (b) of this section, the Board 
may permit designated handlers to make advance payments of their total 
estimated assessments for the season to the Board prior to their actual 
determination of assessable potatoes. Such procedure may be permitted 
when it is considered by the designated handler to be the more practical 
method of payment.
    (ii) Persons using such procedure shall provide a final annual 
accounting of actual handling and assessments.
    (iii) Specific requirements, instructions, and forms for making such 
advance payments shall be provided by the Board upon request.
    (d) Payment through cooperating agency. The Board may authorize 
other organizations to collect assessments in its behalf. In any State 
or area in which the Board has negotiated an agreement to collect 
assessments with an agency such as a State Potato Commission or a Potato 
Association approved by the Secretary, the designated handler shall pay 
the assessment to such agency in the time and manner, and with such 
identifying information as specified in such agreement. Such an 
agreement shall not provide any cooperating agency with authority to 
collect confidential information from handlers; to qualify, the 
cooperating agency must on its own accord have access to all information 
required by the Board for collection purposes. If the Board requires 
further evidence of payment than provided, it may acquire such evidence 
from individual designated handlers.
    (1) All such agreements are subject to the requirement of Sec. 
1207.352 Confidential treatment, of the plan, the provisions of section 
310(c) of the Act, and all applicable rules and regulations and 
financial safeguards in effect under the Act and the plan; and all 
affected persons shall agree to, and conduct their operations and 
activities in accordance with, such requirements.
    (2) [Reserved]

[37 FR 17379, Aug. 26, 1972, as amended by Amdt. 6, 42 FR 55879, Oct. 
20, 1977; 56 FR 40231, Aug. 14, 1991; 62 FR 46179, Sept. 2, 1997]



Sec. 1207.514  [Reserved]



Sec. 1207.515  Safeguards.

    The Board may require reports by designated handlers and importers 
on the handling, importation, and disposition of exempted potatoes. 
Also, authorized employees of the Board or the Secretary, may inspect 
such books and records as are appropriate and necessary to verify the 
reports on such disposition.

[37 FR 17379, Aug. 26, 1972, as amended at 56 FR 40232, Aug. 14, 1991]

                                 Records



Sec. 1207.532  Retention period for records.

    Each handler and importer required to make reports pursuant to this 
subpart shall maintain and retain such records for at least 2 years 
beyond the end of the marketing year of their applicability:

[[Page 73]]

    (a) One copy of each report made to the Board; and
    (b) Such records as are necessary to verify such reports.

[37 FR 17379, Aug. 26, 1972, as amended at 56 FR 40232, Aug. 14, 1991]



Sec. 1207.533  Availability of records.

    (a) Each handler and importer required to make reports pursuant to 
this subpart shall make available for inspection by authorized employees 
of the Board or the Secretary during regular business hours, such 
records as are appropriate and necessary to verify reports required 
under this subpart.
    (b) Importers shall also maintain for 2 years records on the total 
quantities of potatoes imported and on the total quantities of potato 
products imported, and a record of each importation of potatoes, potato 
products, and seed potatoes including quantity, date, and port of entry, 
and shall make such records available for inspection by authorized 
employees of the Board or the Secretary during regular business hours.

[56 FR 40232, Aug. 14, 1991]



Sec. 1207.534  OMB control number assigned pursuant to the Paperwork 
Reduction Act.

    The information collection requirements contained in this part have 
been approved by the Office of Management and Budget (OMB) under the 
provisions of 44 U.S.C. Chapter 35 and have been assigned OMB Control 
number 0581-0093.

[49 FR 23826, June 8, 1984]

                        Confidential Information



Sec. 1207.540  Confidential books, records, and reports.

    All information obtained from the books, records, and reports of 
handler and importers and all information with respect to refunds of 
assessments made to individual producers and importers shall be kept 
confidential in the manner and to the extent provided for in Sec. 
1207.352 of the Plan.

[56 FR 40232, Aug. 14, 1991]



Sec. 1207.545  Right of the Secretary.

    All fiscal matters, programs or proj ects, rules or regulations, 
reports, or other substantive action proposed and prepared by the Board 
shall be submitted to the Secretary for his approval.



Sec. 1207.546  Personal liability.

    No member of the Board shall be held personally responsible, either 
individually or jointly with others, in any way whatsoever to any person 
for errors in judgment, mistakes, or other acts, either of commission or 
omission, as such member, except for acts of willful misconduct, gross 
negligence, or those which are criminal in nature.



PART 1209_MUSHROOM PROMOTION, RESEARCH, AND CONSUMER INFORMATION ORDER
--Table of Contents




 Subpart A_Mushroom Promotion, Research, and Consumer Information Order

                               Definitions

Sec.
1209.1 Act.
1209.2 Commerce.
1209.3 Consumer information.
1209.4 Council.
1209.5 Department.
1209.6 First handler.
1209.7 Fiscal year.
1209.8 Importer.
1209.9 Industry information.
1209.10 Marketing.
1209.11 Mushrooms.
1209.12 On average.
1209.13 Part and subpart.
1209.14 Person.
1209.15 Producer.
1209.16 Programs, plans, and projects.
1209.17 Promotion.
1209.18 Region.
1209.19 Research.
1209.20 Secretary.
1209.21 State and United States.

                            Mushroom Council

1209.30 Establishment and membership.
1209.31 Nominations.
1209.32 Acceptance.
1209.33 Appointment.
1209.34 Term of office.
1209.35 Vacancies.
1209.36 Procedure.
1209.37 Compensation and reimbursement.
1209.38 Powers.
1209.39 Duties.

   Promotion, Research, Consumer Information, and Industry Information

1209.40 Programs, plans, and projects.

[[Page 74]]

                        Expenses and Assessments

1209.50 Budget and expenses.
1209.51 Assessments.
1209.52 Exemption from assessment.
1209.53 Influencing governmental action.

                       Reports, Books, and Records

1209.60 Reports.
1209.61 Books and records.
1209.62 Confidential treatment.

                              Miscellaneous

1209.70 Right of the Secretary.
1209.71 Suspension or termination.
1209.72 Proceedings after termination.
1209.73 Effect of termination or amendment.
1209.74 Personal liability.
1209.75 Patents, copyrights, inventions, publications, and product 
          formulations.
1209.76 Amendments.
1209.77 Separability.

                     Subpart B_Rules and Regulations

                               Definitions

1209.200 Terms defined.

                          Nomination Procedures

1209.230 Reallocation of council members.
1209.231 Nominations.
1209.233 Regional caucus chairpersons.
1209.235 Mail balloting.
1209.237 Appointment.

                                 General

1209.239 Financial statements.

                               Assessments

1209.251 Payment of assessments.
1209.252 Exemption procedures.

                                 Reports

1209.260 Reports.

                              Miscellaneous

1209.280 OMB control numbers.

Subpart C_Procedure for the Conduct of Referenda in Connection With the 
      Mushroom Promotion, Research, and Consumer Information Order

1209.300 General.
1209.301 Definitions.
1209.302 Voting.
1209.303 Instructions.
1209.304 Subagents.
1209.305 Ballots.
1209.306 Referendum report.
1209.307 Confidential information.

    Authority: 7 U.S.C. 6101-6112.

    Source: 57 FR 31951, July 20, 1992, unless otherwise noted.



 Subpart A_Mushroom Promotion, Research, and Consumer Information Order

    Source: 58 FR 3449, Jan. 8, 1993, unless otherwise noted.

                               Definitions



Sec. 1209.1  Act.

    Act means the Mushroom Promotion, Research, and Consumer Information 
Act of 1990, subtitle B of title XIX of the Food, Agriculture, 
Conservation, and Trade Act of 1990, Pub. L. 101-624, 7 U.S.C. 6101-
6112, and any amendments thereto.



Sec. 1209.2  Commerce.

    Commerce means interstate, foreign, or intrastate commerce.



Sec. 1209.3  Consumer information.

    Consumer information means information and programs that will assist 
consumers and other persons in making evaluations and decisions 
regarding the purchase, preparation, and use of mushrooms.



Sec. 1209.4  Council.

    Council means the administrative body referred to as the Mushroom 
Council established under Sec. 1209.30 of this subpart.



Sec. 1209.5  Department.

    Department means the United States Department of Agriculture.



Sec. 1209.6  First handler.

    First handler means any person who receives or otherwise acquires 
mushrooms from a producer and prepares for marketing or markets such 
mushrooms, or who prepares for marketing or markets mushrooms of that 
person's own production.



Sec. 1209.7  Fiscal year.

    Fiscal year means the 12-month period from January 1 to December 31 
each year, or such other period as recommended by the Council and 
approved by the Secretary.

[[Page 75]]



Sec. 1209.8  Importer.

    Importer means any person who imports, on average, over 500,000 
pounds of mushrooms annually from outside the United States.



Sec. 1209.9  Industry information.

    Industry information means information and programs that will lead 
to the development of new markets and marketing strategies, increased 
efficiency, and activities to enhance the image of the mushroom 
industry.



Sec. 1209.10  Marketing.

    (a) Marketing means the sale or other disposition of mushrooms in 
any channel of commerce.
    (b) To market means to sell or otherwise dispose of mushrooms in any 
channel of commerce.



Sec. 1209.11  Mushrooms.

    Mushrooms means all varieties of cultivated mushrooms grown within 
the United States and marketed for the fresh market, or imported into 
the United States and marketed for the fresh market, except such term 
shall not include mushrooms that are commercially marinated, canned, 
frozen, cooked, blanched, dried, packaged in brine, or otherwise 
processed in such manner as the Council, with the approval of the 
Secretary, may determine.



Sec. 1209.12  On average.

    On average means a rolling average of production or imports during 
the last two fiscal years, or such other period as may be determined by 
the Secretary.



Sec. 1209.13  Part and subpart.

    Part means this mushroom promotion and research order and all rules 
and regulations and supplemental orders issued thereunder, and the term 
subpart means the mushroom promotion and research order.



Sec. 1209.14  Person.

    Person means any individual, group of individuals, partnership, 
corporation, association, cooperative, or any other legal entity.



Sec. 1209.15  Producer.

    Producer means any person engaged in the production of mushrooms who 
owns or shares the ownership and risk of loss of such mushrooms and who 
produces, on average, over 500,000 pounds of mushrooms per year.



Sec. 1209.16  Programs, plans, and projects.

    Programs, plans, and projects means promotion, research, consumer 
information, and industry information plans, studies, projects, or 
programs conducted pursuant to this part.



Sec. 1209.17  Promotion.

    Promotion means any action determined by the Secretary to enhance 
the image or desirability of mushrooms, including paid advertising.



Sec. 1209.18  Region.

    Region means one of the described geographic subdivisions of the 
production areas described in Sec. 1209.30 (b) or as later realigned or 
reapportioned pursuant thereto, or the import region described in Sec. 
1209.30(c).



Sec. 1209.19  Research.

    Research means any type of study to advance the image, desirability, 
safety, marketability, production, product development, quality, or 
nutritional value of mushrooms.



Sec. 1209.20  Secretary.

    Secretary means the Secretary of Agriculture of the United States or 
any officer or employee of the Department to whom authority has 
heretofore been delegated, or to whom authority may hereafter be 
delegated, to act in the Secretary's stead.



Sec. 1209.21  State and United States.

    (a) State means any of the several States, the District of Columbia, 
and the Commonwealth of Puerto Rico.
    (b) United States means collectively the several States of the 
United States of America, the District of Columbia, and the Commonwealth 
of Puerto Rico.

[[Page 76]]

                            Mushroom Council



Sec. 1209.30  Establishment and membership.

    (a) There is hereby established a Mushroom Council of not less than 
four or more than nine members. The Council shall be composed of 
producers appointed by the Secretary under Sec. 1209.33, except that, 
as provided in paragraph (c), importers shall be appointed by the 
Secretary to the Council under Sec. 1209.33 once imports, on average, 
reach at least 35,000,000 pounds of mushrooms annually.
    (b) For purposes of nominating and appointing producers to the 
Council, the United States shall be divided into four geographic regions 
and the number of Council members from each region shall be as follows:
    (1) Region 1: including Maine, Vermont, New Hampshire, 
Massachusetts, Rhode Island, Connecticut, New York, Ohio, Kentucky, 
Indiana, Michigan, Wisconsin, Illinois, Missouri, Iowa, Nebraska, 
Kansas, Minnesota, North Dakota, South Dakota, Montana, Colorado, and 
Wyoming--2 Members.
    (2) Region 2: including Pennsylvania, Delaware, New Jersey, the 
District of Columbia, West Virginia, Virginia, and Maryland--3 Members.
    (3) Region 3: including Washington, Oregon, Idaho, Utah, Arizona, 
California, Nevada, Alaska, and Hawaii--3 Members.
    (4) Region 4: including New Mexico, Texas, Oklahoma, Arkansas, 
Louisiana, Alabama, Mississippi, Georgia, Tennessee, North Carolina, 
South Carolina, Florida, and the Commonwealth of Puerto Rico--1 Member.
    (c) Importers shall be represented by a single, separate region, 
referred to as Region 5, consisting of the United States as defined in 
Sec. 1209.21(b) when imports, on average, equal or exceed 35,000,000 
pounds of mushrooms annually.
    (d) At least every five years, and not more than every three years, 
the Council shall review changes in the geographic distribution of 
mushroom production volume throughout the United States and import 
volume, using the average annual mushroom production and imports over 
the preceding four years, and, based on such review, shall recommend to 
the Secretary reapportionment of the regions established in paragraph 
(b), or modification of the number of members from such regions, as 
determined under the rules established in paragraph (e), or both, as 
necessary to best reflect the geographic distribution of mushroom 
production volume in the United States and representation of imports, if 
applicable.
    (e) Subject to the nine-member maximum limitation, the following 
procedure will be used to determine the number of members for each 
region to serve on the Council under paragraph (d):
    (1) Each region that produces, on average, at least 35,000,000 
pounds of mushrooms annually shall be entitled to one representative on 
the Council.
    (2) As provided in paragraph (c), importers shall be represented by 
a single, separate region, which shall be entitled to one 
representative, if such region imports, on average, at least 35,000,000 
pounds of mushrooms annually.
    (3) Each region shall be entitled to representation by an additional 
Council member for each 50,000,000 pounds of annual production or 
imports, on average, in excess of the initial 35,000,000 pounds required 
to qualify the region for representation.
    (4) Should, in the aggregate, regions be entitled to levels of 
representation under paragraphs (e) (1), (2) and (3) that would exceed 
the nine-member limit on the Council under the Act, the regions shall be 
entitled to representation on the Council as follows:
    (i) Each region first shall be assigned one representative on the 
Council pursuant to paragraphs (e) (1) and (2).
    (ii) Then, each region with 50,000,000 pounds of annual production 
or imports, on average, in excess of the initial 35,000,000 pounds 
required to qualify the region for representation shall be assigned one 
additional representative on the Council, except that if under such 
assignments all five regions, counting importers as a region, if 
applicable, would be entitled to additional representatives, that region 
with the smallest on-average volume, in terms of production or imports, 
will

[[Page 77]]

not be assigned an additional representative.
    (iii) After members are assigned to regions under paragraphs (e)(4) 
(i) and (ii), if less than the entire nine seats on the Council have 
been assigned to regions, the remaining seats on the Council shall be 
assigned to each region for each 50,000,000 pound increment of annual 
production or import volume, on average, in excess of 85,000,000 pounds 
until all the seats are filled. It for any such 50,000,000 pound 
increment, more regions are eligible for seats than there are seats 
available, the seat or seats assigned for such increment shall be 
assigned to that region or those regions with greater on-average 
production or import volume than the other regions otherwise eligible at 
that increment level.
    (f) In determining the volume of mushrooms produced in the United 
States or imported into the United States for purposes of this section, 
the Council and the Secretary shall:
    (1) Only consider mushrooms produced or imported by producers and 
importers, respectively, as those terms are defined in Sec. Sec. 1209.8 
and 1209.15; and
    (2) Use the information received by the Council under Sec. 1209.60, 
and data published by the Department.
    (g) For purposes of the provisions of this section relating to the 
appointment of producers and importers to serve on the Council, the term 
producer or importer refers to any individual who is a producer or 
importer, respectively, or if the producer or importer is an entity 
other than an individual, an individual who is an officer or employee of 
such producer or importer.



Sec. 1209.31  Nominations.

    All nominations for appointments to the Council under Sec. 1209.33 
shall be made as follows:
    (a) As soon as practicable after this subpart becomes effective, 
nominations for appointment to the initial Council shall be obtained 
from producers by the Secretary. In any subsequent year in which an 
appointment to the Council is to be made, nominations for positions 
whose terms will expire at the end of that year shall be obtained from 
producers, and as appropriate, importers, and certified by the Council 
and submitted to the Secretary by August 1 of such year, or such other 
date as approved by the Secretary.
    (b) Nominations shall be made at regional caucuses of producers or 
importers, or by mail ballot as provided in paragraph (e), in accordance 
with procedures prescribed in this section.
    (c) Except for initial Council members, whose nomination process 
will be initiated by the Secretary, the Council shall issue a call for 
nominations by February 1 of each year in which nominations for an 
appointment to the Council is to be made. The call shall include, at a 
minimum, the following information:
    (1) A list by region of the vacancies for which nominees may be 
submitted and qualifications as to producers and importers.
    (2) The date by which the names of nominees shall be submitted to 
the Secretary for consideration to be in compliance with paragraph (a) 
of this section.
    (3) A list of those States, by region, entitled to participate in 
the nomination process.
    (4) The date, time, and location of any next scheduled meeting of 
the Council, and national and State producer or importer associations, 
if known, and of the regional caucuses, if any.
    (d)(1) Except as provided in paragraph (e), nominations for each 
position shall be made by regional caucus in the region entitled to 
nominate for such position. Notice of such caucus shall be publicized to 
all producers or importers within the region, and to the Secretary, at 
least 30 days prior to the caucus. The notice shall have attached to it 
the call for nominations from the Council and the Department's equal 
opportunity policy. Except with respect to nominations for the initial 
appointments to the Council, the responsibility for convening and 
publicizing the regional caucus shall be that of the Council.
    (2) All producers or importers within the region may participate in 
the caucus. However, if a producer is engaged in the production of 
mushrooms in more than one region or is also an importer, such person's 
participation within a region shall be limited to one

[[Page 78]]

vote and shall only reflect the volume of such person's production or 
imports within the applicable region.
    (3) The regional caucus shall conduct the selection process for the 
nominees in accordance with procedures to be adopted at the caucus 
subject to the following requirements:
    (i) There shall be two individuals nominated for each open position.
    (ii) Each nominee shall meet the qualifications set forth in the 
call.
    (iii) If a producer nominee is engaged in the production of 
mushrooms in more than one region or is also an importer, such 
individual shall participate within the region that such individual so 
elects in writing to the Council and such election shall remain 
controlling until revoked in writing to the Council.
    (e) After the regional caucuses for the initial Council, the Council 
may conduct the selection of nominees by mail ballot in lieu of a 
regional caucus.
    (f) When producers or importers are voting for nominees to the 
Council, whether through a regional caucus or a mail ballot, the 
following conditions shall apply:
    (1) Voting for any open position shall be on the basis of:
    (i) One vote per eligible voter; and
    (ii) Volume of on-average production or imports of the eligible 
voter within that region.
    (2) Whenever the producers or importers in a region are choosing 
nominees for one open position on the Council, the proposed nominee with 
the highest number of votes cast and the proposed nominee with the 
highest volume of production or importers voted shall be the nominees 
submitted to the Secretary. If a proposed nominee receives both the 
highest number of votes cast and the highest volume of production or 
imports voted, then the proposed nominee with the second highest number 
of votes cast shall be a nominee submitted to the Secretary along with 
such proposed nominee receiving both the highest number of votes cast 
and the highest volume of production or imports voted.
    (3) Whenever the producers or importers in a region are choosing 
nominees for more than one open position on the Council at the same 
time, the number of the nominations submitted to the Secretary shall 
equal twice the number of such open positions, and for each open 
position shall consist of the proposed nominee with the highest number 
of votes cast and the proposed nominee with the highest volume of 
production or imports voted with respect to that position, subject to 
the rule set out in paragraph (f)(2). An individual shall only be 
nominated for one such open position.
    (4) Voters shall certify on their ballots as to their on-average 
production or import volume within the region involved. Such 
certification may be subject to verification.
    (g)(1) The Secretary may reject any nominee submitted. If there are 
insufficient nominees from which to appoint members to the Council as a 
result of the Secretary's rejecting such nominees, additional nominees 
shall be submitted to the Secretary under the procedures set out in this 
section.
    (2) Whenever producers or importers in a region cannot agree on 
nominees for an open position on the Council under the preceding 
provisions of this section, or whenever they fail to nominate 
individuals for appointment to the Council, the Secretary may appoint 
members in such manner as the Secretary, by regulation, determines 
appropriate.



Sec. 1209.32  Acceptance.

    Each individual nominated for membership on the Council shall 
qualify by filing a written acceptance with the Secretary at the time of 
nomination.



Sec. 1209.33  Appointment.

    From the nominations made pursuant to Sec. 1209.31, the Secretary 
shall appoint the members of the Council on the basis of representation 
provided for in Sec. 1209.30, except that no more than one member may 
be appointed to the Council from nominations submitted by any one 
producer or importer.



Sec. 1209.34  Term of office.

    (a) The members of the Council shall serve for terms of three years, 
except that the members appointed to the initial Council shall serve, 
proportionately, for terms of one, two, and three years.

[[Page 79]]

    (b) Members of the initial Council shall be designated for, and 
shall serve, terms as follows: One producer member each from regions 1, 
2 and 3 shall be appointed for an initial term of one year; one producer 
member each from regions 1, 2, and 3 shall be appointed for an initial 
term of two years; and one producer member each from regions 2, 3, and 4 
shall be appointed for an initial term of three years. Because current 
imports of fresh mushrooms are less than 35,000,000 pounds, the minimum 
established for representation on the Council, importers will not 
initially have a member appointed to the Council.
    (c)(1) Except with respect to terms of office of the initial 
Council, the term of office for each member of the Council shall begin 
on January 1 or such other date that may be approved by the Secretary.
    (2) The term of office for the initial Council shall begin 
immediately following appointment by the Secretary, except that time in 
the interim period from appointment until the following January 1, or 
such other date that is the generally applicable beginning date for 
terms under paragraph (c)(1) approved by the Secretary, shall not count 
toward the initial term of office.
    (d) Council members shall serve during the term of office for which 
they are appointed and have qualified, and until their successors are 
appointed and have qualified.
    (e)(1) No member shall serve more than two successive three-year 
terms, except as provided in paragraph (e)(2)(ii).
    (2)(i) Those members serving initial terms of two or three years may 
serve one successive three-year term.
    (ii) Those members serving initial terms of one year may serve two 
successive three-year terms.



Sec. 1209.35  Vacancies.

    (a) To fill any vacancy occasioned by the death, removal, 
resignation, or disqualification of any member of the Council, the 
Secretary may appoint a successor from the most recent nominations 
submitted for open positions on the Council assigned to the region that 
the vacant position represents, or the Secretary may obtain nominees to 
fill such vacancy in such manner as the Secretary, by regulation, deems 
appropriate. Each such successor appointment shall be for the remainder 
of the term vacated. A vacancy will not be required to be filled if the 
unexpired term is less than six months.
    (b)(1) No successor appointed to a vacated term of office shall 
serve more than two successive three-year terms on the Council, except 
as provided in paragraph (b)(2)(ii).
    (2)(i) Any successor serving longer than one year may serve one 
successive three-year term.
    (ii) Any successor serving one year or less may serve two successive 
three-year terms.
    (c) If a member of the Council consistently refuses to perform the 
duties of a member of the Council, or if a member of the Council is 
known to be engaged in acts of dishonesty or willful misconduct, the 
Council may recommend to the Secretary that the member be removed from 
office. If the Secretary finds the recommendation of the Council shows 
adequate cause, the Secretary shall remove such member from office. 
Further, without recommendation of the Council, a member may be removed 
by the Secretary upon showing of adequate cause, including the failure 
by a member to submit reports or remit assessments required under this 
part, if the Secretary determines that such member's continued service 
would be detrimental to the achievement of the purposes of the Act.



Sec. 1209.36  Procedure.

    (a) At a properly convened meeting of the Council, a majority of the 
members shall constitute a quorum.
    (b) Each member of the Council will be entitled to one vote on any 
matter put to the Council, and the motion will carry if supported by a 
simple majority of those voting. At assembled meetings of the Council, 
all votes will be cast in person.
    (c) In lieu of voting at a properly convened meeting and, when in 
the opinion of the chairperson of the Council such action is considered 
necessary, the Council may take action upon the concurring votes of a 
majority of its members by mail, telephone, telegraph, or any other 
means of communication,

[[Page 80]]

but any such action shall be confirmed promptly in writing. In that 
event, all members must be notified and provided the opportunity to 
vote. Any action so taken shall have the same force and effect as though 
such action had been taken at a properly convened meeting of the 
Council. All votes shall be recorded in Council minutes.
    (d) Meetings of the Council may be conducted by electronic 
communications, provided that each member is given prior notice of the 
meeting and has an opportunity to be present either physically or by 
electronic connection.
    (e) The organization of the Council and the procedures for 
conducting meetings of the Council shall be in accordance with its 
bylaws,which shall be established by the Council and approved by the 
Secretary.



Sec. 1209.37  Compensation and reimbursement.

    The members of the Council shall serve without compensation but 
shall be reimbursed for necessary and reasonable expenses, including a 
reasonable per diem allowance, as approved by the Council and the 
Secretary, incurred by such members in the performance of their 
responsibilities under this subpart.



Sec. 1209.38  Powers.

    The Council shall have the following powers:
    (a) To receive and evaluate or, on its own initiative, develop and 
budget for proposed programs, plans, or projects to promote the use of 
mushrooms, as well as proposed programs, plans, or projects for 
research, consumer information, or industry information, and to make 
recommendations to the Secretary regarding such proposals;
    (b) To administer the provisions of this subpart in accordance with 
its terms and provisions;
    (c) To appoint or employ such individuals as it may deem necessary, 
define the duties, and determine the compensation of such individuals;
    (d) To make rules and regulations to effectuate the terms and 
provisions of this subpart;
    (e) To receive, investigate, and report to the Secretary for action 
complaints of violations of the provisions of this subpart;
    (f) To disseminate information to producers, importers, first 
handlers, or industry organizations through programs or by direct 
contact using the public postal system or other systems;
    (g) To select committees and subcommittees of Council members, 
including an executive committee whose powers and membership shall be 
determined by the Council, subject to the approval of the Secretary, and 
to adopt such bylaws and other rules for the conduct of its business as 
it may deem advisable;
    (h) To establish committees which may include individuals other than 
Council members, and pay the necessary and reasonable expenses and fees 
for the members of such committees;
    (i) To recommend to the Secretary amendments to this subpart;
    (j) With the approval of the Secretary, to enter into contracts or 
agreements with national, regional, or State mushroom producer 
organizations, or other organizations or entities, for the development 
and conduct of programs, plans, or projects authorized under Sec. 
1209.40 and with such producer organizations for other services 
necessary for the implementation of this subpart, and for the payment of 
the cost thereof with funds collected and received pursuant to this 
subpart. The Council shall not contract with any producer or importer 
for the purpose of mushroom promotion or research. The Council may lease 
physical facilities from a producer or importer for such promotion or 
research, if such an arrangement is determined to be cost effective by 
the Council and approved by the Secretary. Any contract or agreement 
shall provide that:
    (1) The contractor or agreeing party shall develop and submit to the 
Council a program, plan, or project together with a budget or budgets 
that shall show the estimated cost to be incurred for such program, 
plan, or project;
    (2) Any such program, plan, or project shall become effective upon 
approval of the Secretary;
    (3) The contracting or agreeing party shall keep accurate records of 
all of its transactions and make periodic reports

[[Page 81]]

to the Council of activities conducted, submit accountings for funds 
received and expended, and make such other reports as the Secretary or 
the Council may require; and the Secretary may audit the records of the 
contracting or agreeing party periodically; and
    (4) Any subcontractor who enters into a contract with a Council 
contractor and who receives or otherwise uses funds allocated by the 
Council shall be subject to the same provisions as the contractor;
    (k) With the approval of the Secretary, to invest, pending 
disbursement pursuant to a program, plan, or project, funds collected 
through assessments provided for in Sec. 1209.51, and any other funds 
received by the Council in, and only in, obligations of the United 
States or any agency thereof, in general obligations of any State or any 
political subdivision thereof, in any interest-bearing account or 
certificate of deposit of a bank that is a member of the Federal Reserve 
System, or in obligations fully guaranteed as to principal and interest 
by the United States;
    (l) Such other powers as may be approved by the Secretary; and
    (m) To develop and propose to the Secretary voluntary quality and 
grade standards for mushrooms, if the Council determines that such 
quality and grade standards would benefit the promotion of mushrooms.



Sec. 1209.39  Duties.

    The Council shall have the following duties:
    (a) To meet not less than annually, and to organize and select from 
among its members a chairperson and such other officers as may be 
necessary;
    (b) To evaluate or develop, and submit to the Secretary for 
approval, promotion, research, consumer information, and industry 
information programs, plans, or projects;
    (c) To prepare for each fiscal year, and submit to the Secretary for 
approval at least 60 days prior to the beginning of each fiscal year, a 
budget of its anticipated expenses and disbursements in the 
administration of this subpart, as provided in Sec. 2109.50.
    (d) To maintain such books and records, which shall be available to 
the Secretary for inspection and audit, and to prepare and submit such 
reports from time to time to the Secretary, as the Secretary may 
prescribe, and to make appropriate accounting with respect to the 
receipt and disbursement of all funds entrusted to it;
    (e) To prepare and make public, at least annually, a report of its 
activities carried out, and an accounting for funds received and 
expended;
    (f) To cause its financial statements to be prepared in conformity 
with generally accepted accounting principles and to be audited by an 
independent certified public accountant in accordance with generally 
accepted auditing standards at least once each fiscal year and at such 
other times as the Secretary may request, and submit a copy of each such 
audit to the Secretary;
    (g) To give the Secretary the same notice of meetings of the Council 
as is given to members in order that the Secretary, or a representative 
of the Secretary, may attend such meetings;
    (h) To submit to the Secretary such information as may be requested 
pursuant to this subpart;
    (i) To keep minutes, books, and records that clearly reflect all the 
acts and transactions of the Council. Minutes of each Council meeting 
shall be promptly reported to the Secretary;
    (j) To act as intermediary between the Secretary and any producer or 
importer;
    (k) To follow the Department's equal opportunity/civil rights 
policies; and
    (l) To work to achieve an effective, continuous, and coordinated 
program of promotion, research, consumer information, and industry 
information designed to strengthen the mushroom industry's position in 
the marketplace, maintain and expand existing markets and uses for 
mushrooms, develop new markets and uses for mushrooms, and to carry out 
programs, plans, and projects designed to provide maximum benefits to 
the mushroom industry.

[[Page 82]]

   Promotion, Research, Consumer Information, and Industry Information



Sec. 1209.40  Programs, plans, and projects.

    (a) The Council shall receive and evaluate, or on its own initiative 
develop, and submit to the Secretary for approval any program, plan, or 
project authorized under this subpart. Such programs, plans, or projects 
shall provide for:
    (1) The establishment, issuance, effectuation, and administration of 
appropriate programs for promotion, research, consumer information, and 
industry information with respect to mushrooms; and
    (2) The establishment and conduct of research with respect to the 
sale, distribution, marketing, and use of mushrooms and mushroom 
products, and the creation of new products thereof, to the end that 
marketing and use of mushrooms may be encouraged, expanded, improved or 
made more acceptable. However, as prescribed by the Act, nothing in this 
subpart may be construed to authorize mandatory requirements for quality 
control, grade standards, supply management programs, or other programs 
that would control production or otherwise limit the right of individual 
producers to produce mushrooms.
    (b) No program, plan, or project shall be implemented prior to its 
approval by the Secretary. Once a program, plan, or project is so 
approved, the Council shall take appropriate steps to implement it.
    (c) Each programs, plan, or project implemented under this subpart 
shall be reviewed or evaluated periodically by the Council to ensure 
that it contributes to an effective program of promotion, research, 
consumer information, or industry information. If it is found by the 
Council that any such program, plan, or project does not contribute to 
an effective program of promotion, research, consumer information, or 
industry information, then the Council shall terminate such program, 
plan, or project.
    (d) In carrying out any program, plan, or project, no reference to a 
brand name, trade name, or State or regional identification of any 
mushrooms or mushroom product shall be made. In addition, no program, 
plan, or project shall make use of unfair or deceptive acts or practices 
with respect to the quality, value, or use of any competing product.

                        Expenses and Assessments



Sec. 1209.50  Budget and expenses.

    (a)(1) At least 60 days prior to the beginning of each fiscal year, 
and as may be necessary thereafter, the Council shall prepare and submit 
to the Secretary a budget for the fiscal year covering its anticipated 
expenses and disbursements in administering this subpart. Each such 
budget shall include:
    (i) A statement of objectives and strategy for each program, plan, 
or project;
    (ii) A summary of anticipated revenue, with comparative data for at 
least one preceding year;
    (iii) A summary of proposed expenditures for each program, plan, or 
project; and
    (iv) Staff and administrative expense breakdowns, with comparative 
data for at least one preceding year.

Each budget shall include a rate of assessment for such fiscal year 
calculated, subject to Sec. 1209.51(b), to provide adequate funds to 
defray its proposed expenditures and to provide for a reserve as set 
forth in paragraph (f). The Council may change such rate at any time, as 
provided in Sec. 1209.51(b)(5).
    (2)(i) Subject to paragraph (a)(2)(ii), any amendment or addition to 
an approved budget must be approved by the Secretary, including shifting 
of funds from one program, plan, or project to another.
    (ii) Shifts of funds which do not cause an increase in the Council's 
approved budget and which are consistent with governing bylaws need not 
have prior approval by the Secretary.
    (b) The Council is authorized to incur such expenses, including 
provision for a reasonable reserve, as the Secretary finds are 
reasonable and likely to be incurred by the Council for its maintenance 
and functioning, and to enable it to exercise its powers and perform its 
duties in accordance with the provisions of this subpart. Such expenses

[[Page 83]]

shall be paid from funds received by the Council.
    (c) The Council shall not use funds collected or received under this 
subpart to reimburse, defray, or make payment of expenditures incurred 
in developing, drafting, studying, lobbying on or promoting the 
legislation authorizing this subpart. Such prohibition includes 
reimbursement, defrayment, or payment to mushroom industry associations 
or organizations, producers or importers, lawyers, law firms, or 
consultants.
    (d) The Council may accept voluntary contributions, but these shall 
only be used to pay expenses incurred in the conduct of programs, plans, 
and projects. Such contributions shall be free from any encumbrance by 
the donor and the Council shall retain complete control of their use. 
The donor may recommend that the whole or a portion of the contribution 
be applied to an ongoing program, plan, or project.
    (e) The Council shall reimburse the Secretary, from funds received 
by the Council, for administrative costs incurred by the Secretary in 
implementing and administering this subpart, except for the salaries of 
Department employees incurred in conducting referenda.
    (f) The Council may establish an operating monetary reserve and may 
carry over to subsequent fiscal periods excess funds in any reserve so 
established, except that the funds in the reserve shall not exceed 
approximately one fiscal year's expenses. Such reserve funds may be used 
to defray any expenses authorized under this subpart.
    (g) With the approval of the Secretary, the Council may borrow money 
for the payment of administrative expenses, subject to the same fiscal, 
budget, and audit controls as other funds of the Council.



Sec. 1209.51  Assessments.

    (a) Any first handler initially purchasing, or otherwise placing 
into the current of commerce, mushrooms produced in the United States 
shall, in the manner as prescribed by the Council and approved by the 
Secretary, collect an assessment based upon the number of pounds of 
mushrooms marketed in the United States for the account of the producer, 
and remit the assessment to the Council.
    (b) The rate of assessment effective during any fiscal year shall be 
the rate specified in the budget for such fiscal year approved by the 
Secretary, except that:
    (1) The rate of assessment during the first year this subpart is in 
effect shall be one-quarter of one cent per pound of mushrooms marketed, 
or the equivalent thereof.
    (2) The rate of assessment during the second year this subpart is in 
effect shall not exceed one-third of one cent per pound of mushrooms 
marketed, or the equivalent thereof.
    (3) The rate of assessment during the third year this subpart is in 
effect shall not exceed one-half of one cent per pound of mushrooms 
marketed, or the equivalent thereof.
    (4) The rate of assessment during each of the fourth and following 
years this subpart is in effect shall not exceed one cent per pound of 
mushrooms marketed, or the equivalent thereof.
    (5) The Council may change the rate of assessment for a fiscal year 
at any time with the approval of the Secretary as necessary to reflect 
changed circumstances, except that any such changed rate may not exceed 
the level of assessment specified in paragraphs (b)(1), (2), (3), or 
(4), whichever is applicable.
    (c) Any person marketing mushrooms of that person's own production 
to consumers in the United States, either directly or through retail or 
wholesale outlets, shall be considered a first handler and shall remit 
to the Council an assessment on such mushrooms at the rate per-pound 
then in effect, and in such form and manner prescribed by the Council.
    (d) Only one assessment shall be paid on each unit of mushrooms 
marketed.
    (e)(1) Each importer of mushrooms shall pay an assessment to the 
Council on mushrooms imported for marketing in the United States, 
through the U.S. Customs Service or in such other manner as may be 
established by rules and regulations approved by the Secretary.
    (2) The per-pound assessment rate for imported mushrooms shall be 
the same as the rate provided for mushrooms produced in the United 
States.

[[Page 84]]

    (3) The import assessment shall be uniformly applied to imported 
mushrooms that are identified by the number, 0709.51.0000, in the 
Harmonized Tariff Schedule of the United States or any other number used 
to identify fresh mushrooms.
    (4) The assessments due on imported mushrooms shall be paid when the 
mushrooms are entered or withdrawn for consumption in the United States, 
or at such other time as may be established by rules and regulations 
prescribed by the Council and approved by the Secretary and under such 
procedures as are provided in such rules and regulations.
    (5) Only one assessment shall be paid on each unit of mushrooms 
imported.
    (f) The collection of assessments under this section shall commence 
on all mushrooms marketed in or imported into the United States on or 
after the date established by the Secretary, and shall continue until 
terminated by the Secretary. If the Council is not constituted on the 
date the first assessments are to be collected, the Secretary shall have 
the authority to receive assessments on behalf of the Council and may 
hold such assessments until the Council is constituted, then remit such 
assessments to the Council.
    (g)(1) Each person responsible for remitting assessments under 
paragraphs (a), (c), or (e) shall remit the amounts due from assessments 
to the Council on a monthly basis no later than the fifteenth day of the 
month following the month in which the mushrooms were marketed, in such 
manner as prescribed by the Council.
    (2)(i) A late payment charge shall be imposed on any person that 
fails to remit to the Council the total amount for which the person is 
liable on or before the payment due date established under this section. 
The amount of the late payment charge shall be prescribed in rules and 
regulations as approved by the Secretary.
    (ii) An additional charge shall be imposed on any person subject to 
a late payment charge, in the form of interest on the outstanding 
portion of any amount for which the person is liable. The rate of 
interest shall be prescribed in rules and regulations as approved by the 
Secretary.
    (3) Any assessment that is determined to be owing at a date later 
than the payment due established under this section, due to a person's 
failure to submit a report to the Council by the payment due date, shall 
be considered to have been payable on the payment due date. Under such a 
situation, paragraphs (g)(2)(i) and (g)(2)(ii) of this section shall be 
applicable.
    (h) The Council, with the approval of the Secretary, may enter into 
agreements authorizing other organizations to collect assessments in its 
behalf. Any such organization shall be required to maintain the 
confidentiality of such information as is required by the Council for 
collection purposes. Any reimbursement by the Council for such services 
shall be based on reasonable charges for services rendered.
    (i) The Council is hereby authorized to accept advance payment of 
assessments for the fiscal year by any person, that shall be credited 
toward any amount for which such person may become liable. The Council 
shall not be obligated to pay interest on any advance payment.



Sec. 1209.52  Exemption from assessment.

    (a) Persons that produce or import, on average, 500,000 pounds or 
less of mushrooms annually shall be exempted from assessment.
    (b) To claim such exemption, such persons shall apply to the 
Council, in the form and manner prescribed in the rules and regulations.
    (c) Mushrooms produced in the United States that are exported are 
exempt from assessment and are subject to such safeguards as prescribed 
in rules and regulations to prevent improper use of this exemption.
    (d) Domestic and imported mushrooms used for processing are exempt 
from assessment and are subject to such safeguards as prescribed in 
rules and regulations to prevent improper use of this exemption.



Sec. 1209.53  Influencing governmental action.

    No funds received by the Council under this subpart shall in any 
manner be used for the purpose of influencing legislation or 
governmental policy or

[[Page 85]]

action, except to develop and recommend to the Secretary amendments to 
this subpart, and to submit to the Secretary proposed voluntary grade 
and quality standards for mushrooms.

                       Reports, Books and Records



Sec. 1209.60  Reports.

    (a) Each producer marketing mushrooms of that person's own 
production directly to consumers, and each first handler responsible for 
the collection of assessments under Sec. 1209.51(a) shall be required 
to report monthly to the Council, on a form provided by the Council, 
such information as may be required under this subpart or any rules and 
regulations issued thereunder. Such information shall include, but not 
be limited to, the following:
    (1) The first handler's name, address, and telephone number;
    (2) Date of report, which is also the date of payment to the 
Council;
    (3) Period covered by the report;
    (4) The number of pounds of mushrooms purchased, initially 
transferred, or that in any other manner are subject to the collection 
of assessments, and a copy of a certificate of exemption, claiming 
exemption under Sec. 1209.52 from those who claim such exemptions;
    (5) The amount of assessments remitted; and
    (6) The basis, if necessary, to show why the remittance is less than 
the number of pounds of mushrooms determined under paragraph (a)(4) 
multiplied by the applicable assessment rate.
    (b) If determined necessary by the Council and approved by the 
Secretary, each importer shall file with the Council periodic reports, 
on a form provided by the Council, containing at least the following 
information:
    (1) The importer's name, address, and telephone number;
    (2) The quantity of mushrooms entered or withdrawn for consumption 
in the United States during the period covered by the report; and
    (3) The amount of assessments paid to the U.S. Customs Service at 
the time of such entry or withdrawal.
    (c) The words final report shall be shown on the last report at the 
end of each fiscal year.



Sec. 1209.61  Books and records.

    Each persons who is subject to this subpart shall maintain and make 
available for inspection by the Council or the Secretary such books and 
records as are deemed necessary by the Council, with the approval of the 
Secretary, to carry out the provisions of this subpart and any rules and 
regulations issued hereunder, including such books and records as are 
necessary to verify any reports required. Such books and records shall 
be retained for at least two years beyond the fiscal year of their 
applicability.



Sec. 1209.62  Confidential treatment.

    All information obtained from books, records, or reports under the 
Act, this subpart, and the rules and regulations issued thereunder shall 
be kept confidential by all persons, including all employees and former 
employees of the Council, all officers and employees and former officers 
and employees of the Department, and all officers and employees and 
former officers and employees of contracting and subcontracting agencies 
or agreeing parties having access to such information. Such information 
shall not be available to Council members, producers, importers, or 
first handlers. Only those persons having a specific need for such 
information to effectively administer the provisions of this subpart 
shall have access to such information. Only such information so obtained 
as the Secretary deems relevant shall be disclosed by them, and then 
only in a suit or administrative hearing brought at the direction, or on 
the request, of the Secretary, or to which the Secretary or any officer 
of the United States is a party, and involving this subpart. Nothing in 
this section shall be deemed to prohibit:
    (a) The issuance of general statements based upon the reports of the 
number of persons subject to this subpart or statistical data collected 
therefrom, which statements do not identify the information furnished by 
any person; and
    (b) The publication, by direction of the Secretary, of the name of 
any person who has been adjudged to have violated this subpart, together 
with a

[[Page 86]]

statement of the particular provisions of this subpart violated by such 
person.

                              Miscellaneous



Sec. 1209.70  Right of the Secretary.

    All fiscal matters, programs, plans, or projects, rules or 
regulations, reports, or other substantive actions proposed and prepared 
by the Council shall be submitted to the Secretary for approval.



Sec. 1209.71  Suspension or termination.

    (a) Whenever the Secretary finds that this subpart or any provision 
thereof obstructs or does not tend to effectuate the declared policy of 
the Act, the Secretary shall terminate or suspend the operation of this 
subpart or such provision thereof.
    (b)(1) Five years after the date on which this subpart becomes 
effective, the Secretary shall conduct a referendum among producers and 
importers to determine whether they favor continuation, termination, or 
suspension of this subpart.
    (2) Effective beginning three years after the date on which this 
subpart becomes effective, the Secretary, on request of a representative 
group comprising 30 percent or more of the number of mushroom producers 
and importers, may conduct a referendum to determine whether producers 
and importers favor termination or suspension of this subpart.
    (3) Whenever the Secretary determines that suspension or termination 
of this subpart is favored by a majority of the mushroom producers and 
importers voting in a referendum under paragraphs (b) (1) or (2) who, 
during a representative period determined by the Secretary, have been 
engaged in producing and importing mushrooms and who, on average, 
annually produced and imported more than 50 percent of the volume of 
mushrooms produced and imported by all those producers and importers 
voting in the referendum, the Secretary shall:
    (i) Suspend or terminate, as appropriate, collection of assessments 
within six months after making such determination; and
    (ii) Suspend or terminate, as appropriate, all activities under this 
subpart in an orderly manner as soon as practicable.
    (4) Referenda conducted under this subsection shall be conducted in 
such manner as the Secretary may prescribe.



Sec. 1209.72  Proceedings after termination.

    (a) Upon the termination of this subpart, the Council shall 
recommend not more than five of its members to the Secretary to serve as 
trustees for the purpose of liquidating the affairs of the Council. Such 
persons, upon designation by the Secretary, shall become trustees of all 
the funds and property owned, in the possession of, or under the control 
of the Council, including any claims unpaid or property not delivered, 
or any other claim existing at the time of such termination.
    (b) The trustees shall:
    (1) Continue in such capacity until discharged by the Secretary;
    (2) Carry out the obligations of the Council under any contract or 
agreement entered into by it under this subpart;
    (3) From time to time account for all receipts and disbursements, 
and deliver all property on hand, together with all books and records of 
the Council and of the trustees, to such persons as the Secretary may 
direct; and
    (4) Upon the request of the Secretary, execute such assignments or 
other instruments necessary or appropriate to vest in such persons full 
title and right to all of the funds, property, and claims vested in the 
Council or the trustees under this subpart.
    (c) Any person to whom funds, property, or claims have been 
transferred or delivered under this subpart shall be subject to the same 
obligations imposed upon the Council and upon the trustees.
    (d) Any residual funds not required to defray the necessary expenses 
of liquidation shall be turned over to the Secretary to be used, to the 
extent practicable, in the interest of continuing one or more of the 
promotion, research, consumer information, or industry information 
programs, plans, or projects authorized under this subpart.

[[Page 87]]



Sec. 1209.73  Effect of termination or amendment.

    Unless otherwise expressly provided by the Secretary, the 
termination of this subpart or of any rule and regulation issued under 
this subpart, or the issuance of any amendment to such provisions, shall 
not:
    (a) Affect or waive any right, duty, obligation, or liability that 
shall have arisen or may hereafter arise in connection with any 
provision of this subpart or any such rules or regulations;
    (b) Release or extinguish any violation of this subpart or any such 
rules or regulations; or
    (c) Affect or impair any rights or remedies of the United States, 
the Secretary, or any person with respect to any such violation.



Sec. 1209.74  Personal liability.

    No member or employee of the Council shall be held personally 
responsible, either individually or jointly, in any way whatsoever, to 
any person for errors in judgment, mistakes, or other acts of either 
commission or omission of such member or employee under this subpart, 
except for acts of dishonesty or willful misconduct.



Sec. 1209.75  Patents, copyrights, inventions, publications, and 
product formulations.

    Any patents, copyrights, inventions, publications, or product 
formulations developed through the use of funds received by the Council 
under this subpart shall be the property of the United States Government 
as represented by the Council and shall, along with any rents, 
royalties, residual payments, or other income from the rental, sale, 
leasing, franchising, or other uses of such patents, copyrights, 
inventions, publications, or product formulations inure to the benefit 
of the Council and be considered income subject to the same fiscal, 
budget, and audit controls as other funds of the Council. Upon 
termination of this subpart, Sec. 1209.72 shall apply to determine 
disposition of all such property.



Sec. 1209.76  Amendments.

    Amendments to this subpart may be proposed, from time to time, by 
the Council or by any interested person affected by the provisions of 
the Act, including the Secretary.



Sec. 1209.77  Separability.

    If any provision of this subpart is declared invalid, or the 
applicability thereof to any person or circumstances is held invalid, 
the validity of the remainder of this subpart or the applicability 
thereof to other persons or circumstances shall not be affected thereby.



                     Subpart B_Rules and Regulations

    Source: 58 FR 8197, Feb. 11, 1993, unless otherwise noted.

                               Definitions



Sec. 1209.200  Terms defined.

    Unless otherwise defined in this subpart, the definitions of terms 
used in this subpart shall have the same meaning as the definitions in 
Subpart A--Mushroom Promotion, Research, and Consumer Information Order 
of this part.

                          Nomination Procedures



Sec. 1209.230  Reallocation of council members.

    Pursuant to Sec. 1209.30 of the Order, the regions and their number 
of members on the Council shall be as follows:
    Region 1: Colorado, Connecticut, Illinois, Indiana, Iowa, Kansas, 
Kentucky, Maine, Massachusetts, Michigan, Minnesota, Missouri, Montana, 
Nebraska, New York, New Hampshire, North Dakota, Ohio, Rhode Island, 
South Dakota, Vermont, Wisconsin, and Wyoming--1 Producer Member.
    Region 2: Delaware, Maryland, New Jersey, Pennsylvania, the District 
of Columbia, West Virginia, and Virginia--3 Producer Members.
    Region 3: Alaska, Arizona, California, Hawaii, Idaho, Nevada, 
Oregon, Utah, and Washington--2 Producer Members.
    Region 4: Alabama, Arkansas, Florida, Georgia, Louisiana, 
Mississippi, New Mexico, North Carolina, Oklahoma, the Commonwealth of 
Puerto Rico, South Carolina, Tennessee, and Texas--2 Producer Members.
    Region 5:--1 Importer Member.

[67 FR 46579, July 16, 2002]

[[Page 88]]



Sec. 1209.231  Nominations.

    Nominations shall be made at regional caucuses of producers or 
importers, or by mail ballot in accordance with the procedures 
prescribed in Sec. 1209.31 of this part. Proxy voting by producers and 
importers shall not be permitted at a regional caucus or in a mail 
ballot. Each regional caucus and mail ballot shall be scheduled so as to 
ensure that the nominations for each position that will be open at the 
beginning of the following year are received by the Secretary by August 
1, or such other date approved by the Secretary.



Sec. 1209.233  Regional caucus chairpersons.

    (a) Regional caucus chairpersons shall be elected by a simple 
majority vote of eligible voters in attendance. Such elections shall be 
coordinated by the Council, except for the initial elections, which 
shall be coordinated by a representative of the Secretary.
    (b) Regional caucus chairpersons will coordinate the entire 
nomination process. In conducting the nominations process, each regional 
caucus chairperson shall ensure that:
    (1) Voting for producer nominees is limited to producers, and voting 
for importer nominees is limited to importers; and
    (2) Producer candidates for nomination are producers, and importer 
candidates for nomination are importers.
    (c) Within 14 days after completion of each regional caucus, each 
chairperson shall provide the Secretary with the following information:
    (1) The identification of that region's two nominees for each open 
position on the Council; and
    (2) A typed copy of the regional caucus's minutes.
    (d) The chairperson of each regional caucus shall provide nominees 
with qualification statements and other specified information. Each 
nominee will be contacted by the chairperson and asked to forward such 
completed documentation to the Council within 14 days after completion 
of the regional caucus, except for the initial nominees, which shall be 
asked to forward such completed documentation to the Secretary.
    (e) The tenure of the chairperson shall only be for the duration of 
the regional caucus and the preparation of required documentation.



Sec. 1209.235  Mail balloting.

    (a) After the initial regional caucuses, the Council may conduct 
nominations of individuals as candidates for appointment to the Council 
by mail ballot in lieu of a regional caucus.
    (b)(1) In the event of a mail ballot, all qualified individuals in a 
region interested in serving as a member on the Council or persons who 
are interested in nominating an individual to serve on the Council shall 
submit to the Council in writing such information as name, mailing 
address, number of pounds of mushrooms produced or imported, or such 
other information as may be required, in order to place such individual 
on the ballot.
    (2) Notice of mail balloting to nominate candidates for a position 
on the Council shall be publicized by the Council to producers or 
importers in the region involved, and to the Secretary, at least 120 
days before the region's nominee ballot is issued.
    (3) In proposing nominees for inclusion on a mail ballot, proposed 
nominations must be received by the Council at least 30 days before the 
region's nominee ballot is issued.
    (c) Once proposed nominations have been submitted from the 
applicable region, the Council shall cause each proposed nomination, if 
the individual qualifies, to be placed on the region's nominee ballot. 
The Council then shall mail a ballot to each known producer or importer 
within the region.
    (d) Distribution of ballots shall be announced by press releases, 
furnishing pertinent information on balloting, issued by the Council 
through newspapers and other publications having general circulation 
among producers in the mushroom producing areas involved or among 
mushroom importers.
    (e) Each producer or importer shall cast a ballot for each open 
position on the Council assigned to the region in accordance with the 
procedures prescribed in Sec. 1209.31 of this part. The completed 
ballot must be returned to the Council or its designee within 30 days 
after the ballot is issued.

[[Page 89]]

    (f) Within 45 days after a mail ballot is issued, the Council shall 
validate the ballots cast, tabulate the votes, and provide the Secretary 
with the results of the vote and the identification of the region's two 
nominees for each open position on the Council.
    (g) The Council shall provide nominees with qualification statements 
and other specified information. Each nominee selected in the mail 
ballot will be contacted by the Council and asked to forward such 
completed documentation to the Council within 14 days of such 
notification.



Sec. 1209.237  Appointment.

    If an employee, partner, officer, or shareholder of a producer or 
importer is a current member of the Council, no nominee who is also an 
employee, partner, officer, or shareholder of such producer or importer 
shall be appointed to the Council. A Council member shall be 
disqualified from serving on the Council if such individual ceases to be 
affiliated with a producer or importer within the region the Council 
member represents.

                                 General



Sec. 1209.239  Financial statements.

    (a) As requested by the Secretary, the Council shall prepare and 
submit financial statements to the Secretary on a periodic basis. Each 
such financial statement shall include, but not be limited to, a balance 
sheet, income statement, and expense budget. The expense budget shall 
show expenditures during the time period covered by the report, year-to-
date expenditures, and the unexpended budget.
    (b) Each financial statement shall be submitted to the Secretary 
within 30 days after the end of the time period to which it applies.
    (c) The Council shall submit annually to the Secretary an annual 
financial statement within 90 days after the end of the fiscal year to 
which it applies.

                               Assessments



Sec. 1209.251  Payment of assessments.

    (a) Each first handler responsible for collecting assessments on 
domestic mushrooms shall collect the amounts assessed and remit such 
amounts to the Council on a monthly basis not later than the fifteenth 
day of the month following the month in which the mushrooms were 
marketed to or through the first handler.
    (b) Each producer responsible for paying any assessment amount on 
the producer's own mushrooms shall remit such amount to the Council on a 
monthly basis not later than the fifteenth day of the month following 
the month in which the mushrooms were marketed by the producer.
    (c) Each importer shall be responsible for remittance to the Council 
of any assessment amount not collected by the U.S. Customs Service at 
the time of entry or withdrawal for consumption into the United States. 
Any such assessment amount shall be remitted to the Council on a monthly 
basis not later than the fifteenth day of the month following the month 
of entry or withdrawal for consumption into the United States. Any 
person who imports mushrooms, as principal or as an agent, broker, or 
consignee for any person who produces mushrooms outside the United 
States for marketing in the United States shall be considered an 
importer.
    (d) Remittance shall be by check, draft, or money order payable to 
the Mushroom Council, and shall be accompanied by a report, on a form 
provided by the Council.
    (e) A late payment charge shall be imposed on any first handler or 
importer who fails to make timely remittance to the Council of the total 
assessment amount for which the person is liable. Such late payment 
charge shall be imposed on any assessments not received by the last day 
of the month following the month in which the mushrooms involved were 
marketed or, in the case of imports, not collected by the U.S. Customs 
Service at the time of entry or withdrawal for consumption into the 
United States. This one-time late payment charge shall be 10 percent of 
the assessments due before interest charges have accrued. The late 
payment charge will not be applied to any late payments postmarked 
within 15 days after the end of the month such assessments are due.

[[Page 90]]

    (f) In addition to the late payment charge, interest shall be 
charged at a rate of one and one-half percent per month on the 
outstanding balance, including the late payment charge and any accrued 
interest, of any account that remains delinquent beyond the last day of 
the second month following the month the mushrooms involved were 
marketed. However, first handlers paying their assessments, in 
accordance with paragraph (h)(2) of this section, will not be subject to 
the one and one-half percent per month interest under this paragraph 
until the last day of the second month after such assessments are due 
under paragraph (h)(2) of this section. In the case of imports, such a 
rate of interest will be charged to any account that remains delinquent 
on any assessments not collected by the U.S. Customs Service at the time 
of entry or withdrawal for consumption into the United States. Such a 
rate of interest will continue to be charged monthly until the 
outstanding balance is paid to the Council.
    (g) Any assessment determined by the Council at a date later than 
prescribed by this section, because of a person's failure to submit a 
report to the Council when due, shall be considered to have been payable 
by the date it would have been due if the report had been filed on time. 
A late payment charge and monthly interest charges on the outstanding 
balance shall be applicable to such unpaid assessment in accordance with 
paragraphs (e) and (f) of this section.
    (h) In lieu of the monthly assessment payment and reporting 
requirements of Sec. 1209.260 of this subpart and Sec. 1209.60 of this 
part, the Council may permit a first handler to make advance payment of 
the total estimated assessment amount due to the Council for the ensuing 
fiscal year, or portion thereof, prior to the actual determination of 
assessable mushrooms.
    (1) Each person shall provide an initial report estimating 
assessable mushrooms. The Council may request additional information on 
such estimate.
    (2) Each person shall provide a final report of actual marketings 
during the period involved and remit any unpaid assessments not later 
than the fifteenth day of the month following the end of the period 
covered.
    (3) Any person whose prepayment exceeds the amount paid shall be 
reimbursed for the amount of overpayment. The Council shall not, in any 
case, be obligated to pay interest on any advance payment.



Sec. 1209.252  Exemption procedures.

    (a) Any person who produces or imports, on average, 500,000 pounds 
or less of mushrooms annually and who desires to claim an exemption from 
assessments during a fiscal year as provided in Sec. 1209.52 of this 
part shall apply to the Council, on a form provided by the Council, for 
a certificate of exemption. Such persons shall certify that their 
production or importation of mushrooms shall not exceed 500,000 pounds, 
on average, for the fiscal year for which the exemption is claimed. 
Pursuant to this section, the term on average shall be calculated by 
averaging a person's estimated production or importation for the fiscal 
year for which an exemption is claimed with such person's production or 
importation in the preceding fiscal year.
    (b) On receipt of an application, the Council shall determine 
whether an exemption may be granted. The Council then will issue, if 
deemed appropriate, a certificate of exemption to each person that is 
eligible to receive one. Each person who is exempt from assessment must 
provide an exemption number to the first handler in order not to be 
subject to collection of an assessment on mushrooms. First handlers and 
importers, except as otherwise authorized by the Council, shall maintain 
records showing the exemptee's name and address along with the exemption 
number assigned by the Council. Importers who are exempt from assessment 
shall be eligible for reimbursement of assessments collected by the U.S. 
Customs Service and shall apply to the Council for reimbursement of such 
assessments paid.
    (c) Any person who desires to renew the exemption from assessments 
for a subsequent fiscal year shall reapply to the Council, on a form 
provided by the Council, for a certificate of exemption.

[[Page 91]]

    (d) The Council may require persons receiving an exemption from 
assessments to provide to the Council reports on the disposition of 
exempt mushrooms.

                                 Reports



Sec. 1209.260  Reports.

    Each first handler shall be required to report monthly to the 
Council such information as may be required under Sec. 1209.60(a) of 
this part. In addition, each first handler shall be required to provide 
the tax identification number or social security number of each producer 
the first handler has dealt with during the time period covered by the 
report.

[58 FR 8197, Feb. 11, 1993, as amended at 60 FR 13614, Mar. 14, 1995]

                              Miscellaneous



Sec. 1209.280  OMB control numbers.

    The control number assigned to the information collection 
requirements by the Office of Management and Budget pursuant to the 
Paperwork Reduction Act of 1980, 44 U.S.C. 3501 et seq. is OMB control 
number 0581-0093, except for the Council nominee background statement 
form which is assigned OMB control number 0505-0001.



Subpart C_Procedure for the Conduct of Referenda in Connection With the 
      Mushroom Promotion, Research, and Consumer Information Order

    Source: 62 FR 66975, Dec. 23, 1997, unless otherwise noted.



Sec. 1209.300  General.

    A referendum to determine whether eligible producers and importers 
favor continuation of the Mushroom Promotion, Research, and Consumer 
Information Order shall be conducted in accordance with these 
procedures.



Sec. 1209.301  Definitions.

    Unless otherwise defined below, the definition of terms used in 
these procedures shall have the same meaning as the definitions in the 
Order.
    (a) Administrator means the Administrator of the Agricultural 
Marketing Service, with power to redelegate, or any officer or employee 
of the Department to whom authority has been delegated or may hereafter 
be delegated to act in the Administrator's stead.
    (b) Order means the Mushroom Promotion, Research, and Consumer 
Information Order, including an amendment to the Order.
    (c) Referendum agent or agent means the individual or individuals 
designated by the Secretary to conduct the referendum.
    (d) Representative period means the period designated by the 
Secretary.
    (e) Person means any individual, group of individuals, partnership, 
corporation, association, cooperative, or any other legal entity. For 
the purpose of this definition, the term ``partnership'' includes, but 
is not limited to:
    (1) A husband and wife who have title to, or leasehold interest in, 
mushroom production facilities and equipment as tenants in common, joint 
tenants, tenants by the entirety, or, under community property laws, as 
community property, and
    (2) So-called ``joint ventures'', wherein one or more parties to the 
agreement, informal or otherwise, contributed capital and others 
contributed labor, management, equipment, or other services, or any 
variation of such contributions by two or more parties so that it 
results in the production or importation of fresh mushrooms and the 
authority to transfer title to the mushrooms so produced or imported.
    (f) Eligible producer means any person or entity defined as a 
producer who produces, on average, over 500,000 pounds annually of fresh 
mushrooms during the representative period and who:
    (1) Owns or shares in the ownership of mushroom production 
facilities and equipment resulting in the ownership of the mushrooms 
produced;
    (2) Rents mushroom production facilities and equipment resulting in 
the ownership of all or a portion of the mushrooms produced;

[[Page 92]]

    (3) Owns mushroom production facilities and equipment but does not 
manage them and, as compensation, obtains the ownership of a portion of 
the mushrooms produced; or
    (4) Is a party in a landlord-tenant relationship or a divided 
ownership arrangement involving totally independent entities cooperating 
only to produce mushrooms who share the risk of loss and receive a share 
of the mushrooms produced. No other acquisition of legal title to 
mushrooms shall be deemed to result in persons becoming eligible 
producers.
    (g) Eligible importer means any person or entity defined as an 
importer who imports, on average, over 500,000 pounds annually of fresh 
mushrooms during the representative period. Importation occurs when 
commodities originating outside the United States are entered or 
withdrawn from the U.S. Customs Service for consumption in the United 
States. Included are persons who hold title to foreign-produced 
mushrooms immediately upon release by the U.S. Customs Service, as well 
as any persons who act on behalf of others, as agents or brokers, to 
secure the release of mushrooms from the U.S. Customs Service when such 
mushrooms are entered or withdrawn for consumption in the United States.



Sec. 1209.302  Voting.

    (a) Each person who is an eligible producer or importer, as defined 
in this subpart, at the time of the referendum and during the 
representative period, shall be entitled to cast only one ballot in the 
referendum. However, each producer in a landlord-tenant relationship or 
a divided ownership arrangement involving totally independent entities 
cooperating only to produce mushrooms, in which more than one of the 
parties is a producer, shall be entitled to cast one ballot in the 
referendum covering only such producer's share of the ownership.
    (b) Proxy voting is not authorized, but an officer or employee of an 
eligible corporate producer or importer, or an administrator, executor, 
or trustee of an eligible producing or importing entity may cast a 
ballot on behalf of such producer or importer entity. Any individual so 
voting in a referendum shall certify that such individual is an officer 
or employee of the eligible producer or importer, or an administrator, 
executor, or trustee of an eligible producing or importing entity, and 
that such individual has the authority to take such action. Upon request 
of the referendum agent, the individual shall submit adequate evidence 
of such authority.
    (c) Ballots are to be cast by mail or fax.



Sec. 1209.303  Instructions.

    The referendum agent shall conduct the referendum, in the manner 
herein provided, under the supervision of the Administrator. The 
Administrator may prescribe additional instructions, not inconsistent 
with the provisions hereof, to govern the procedure to be followed by 
the referendum agent. Such agent shall:
    (a) Determine the time of commencement and termination of the period 
during which ballots may be cast.
    (b) Provide ballots and related material to be used in the 
referendum. Ballot material shall provide for recording essential 
information including that needed for ascertaining:
    (1) Whether the person voting, or on whose behalf the vote is cast, 
is an eligible voter;
    (2) The total volume of mushrooms produced by the voting producer 
during the representative period; and
    (3) The total volume of mushrooms imported by the voting importer 
during the representative period.
    (c) Give reasonable advance public notice of the referendum:
    (1) By utilizing available media or public information sources, 
without incurring advertising expense, to publicize the dates, places, 
method of voting, eligibility requirements, and other pertinent 
information. Such sources of publicity may include, but are not limited 
to, print and radio; and
    (2) By such other means as the agent may deem advisable.
    (d) Mail to eligible producers and importers, whose names and 
addresses are known to the referendum agent, the instructions on voting, 
a ballot, and a summary of the terms and conditions of the Order. No 
person who claims to

[[Page 93]]

be eligible to vote shall be refused a ballot.
    (e) Collect and safeguard ballots received by fax.
    (f) At the end of the voting period, collect, open, number, and 
review the ballots and tabulate the results.
    (g) Prepare a report on the referendum.
    (h) Prepare an announcement of the results for the public.



Sec. 1209.304  Subagents.

    The referendum agent may appoint any individual or individuals 
deemed necessary or desirable to assist the agent in performing such 
agent's functions hereunder. Each individual so appointed may be 
authorized by the agent to perform any or all of the functions which, in 
the absence of such appointment, shall be performed by the agent.



Sec. 1209.305  Ballots.

    The referendum agent and subagents shall accept all ballots cast; 
but, should they, or any of them, deem that a ballot should be 
challenged for any reason, the agent or subagent shall endorse above 
their signature, on the ballot, a statement to the effect that such 
ballot was challenged, by whom challenged, the reasons therefore, the 
results of any investigations made with respect thereto, and the 
disposition thereof. Ballots invalid under this subpart shall not be 
counted.



Sec. 1209.306  Referendum report.

    Except as otherwise directed, the referendum agent shall prepare and 
submit to the Administrator a report on results of the referendum, the 
manner in which it was conducted, the extent and kind of public notice 
given, and other information pertinent to analysis of the referendum and 
its results.



Sec. 1209.307  Confidential information.

    The ballots and other information or reports that reveal, or tend to 
reveal, the identity or vote of any person covered under the Act shall 
be held confidential and shall not be disclosed.



PART 1210_WATERMELON RESEARCH AND PROMOTION PLAN--Table of Contents




            Subpart A_Watermelon Research and Promotion Plan

                               Definitions

Sec.
1210.301 Secretary.
1210.302 Act.
1210.303 Plan.
1210.304 Board.
1210.305 Watermelon.
1210.306 Producer.
1210.307 Handle.
1210.308 Handler.
1210.309 Person.
1210.310 Fiscal period and marketing year.
1210.311 Programs and projects.
1210.312 Promotion.
1210.313 Research.
1210.314 Importer.
1210.315 United States.

                   National Watermelon Promotion Board

1210.320 Establishment and membership.
1210.321 Nominations and selection.
1210.322 Term of office.
1210.323 Acceptance.
1210.324 Vacancies.
1210.325 Procedure.
1210.326 Compensation and reimbursement.
1210.327 Powers.
1210.328 Duties.

                         Research and Promotion

1210.330 Policy and objective.
1210.331 Programs and projects.

                        Expenses and Assessments

1210.340 Budget and expenses.
1210.341 Assessments.
1210.342 Exemption from assessment.
1210.343 [Reserved]
1210.344 Operating reserve.

                       Reports, Books, and Records

1210.350 Reports.
1210.351 Books and records.
1210.352 Confidential treatment.

                              Miscellaneous

1210.360 Right of the Secretary.
1210.361 Personal liability.
1210.362 Influencing government action.
1210.363 Suspension or termination.
1210.364 Proceedings after termination.
1210.365 Effect of termination or amendment.
1210.366 Separability.
1210.367 Patents, copyrights, inventions, and publications.

[[Page 94]]

                     Subpart B_Nominating Procedures

                      Producer and Handler Members

1210.400 Terms defined.
1210.401 District conventions.
1210.402 Voter and board member nominee eligibility.
1210.403 Voting procedures.

                            Importer Members

1210.404 Importer member nomination and selection.

                              Public Member

1210.405 Public member nominations and selection.

                     Subpart C_Rules and Regulations

                               Definitions

1210.500 Terms defined.

                                 General

1210.501 Realignment of districts.
1210.502 [Reserved]
1210.504 Contracts.
1210.505 Department of Agriculture costs.

                               Assessments

1210.515 Levy of assessments.
1210.516 [Reserved]
1210.517 Determination of handler.
1210.518 Payment of assessments.
1210.519 Failure to report and remit.
1210.520 Refunds.
1210.521 Reports of disposition of exempted watermelons.

                                 Records

1210.530 Retention period for records.
1210.531 Availability of records.
1210.532 Confidential books, records, and reports.

                              Miscellaneous

1210.540 OMB assigned numbers.

                     Subpart D_Referendum Procedures

1210.600 General.
1210.601 Definitions.
1210.602 Voting.
1210.603 Instructions.
1210.604 Subagents.
1210.605 Ballots.
1210.606 Referendum report.
1210.607 Confidential information.

    Authority: 7 U.S.C. 4901-4916.

    Source: 53 FR 51091, Dec. 20, 1988, unless otherwise noted.



            Subpart A_Watermelon Research and Promotion Plan

    Source: 54 FR 24545, June 8, 1989, unless otherwise noted.

                               Definitions



Sec. 1210.301  Secretary.

    Secretary means the Secretary of Agriculture of the United States or 
any officer or employee of the Department to whom authority has 
heretofore been delegated, or to whom authority may hereafter be 
delegated, to act in the Secretary's stead.



Sec. 1210.302  Act.

    Act means the Watermelon Research and Promotion Act of 1985 (Title 
XVI, Subtitle C of Pub. L. 99-198, 99th Congress, effective January 1, 
1986, 99 Stat. 1622), as amended.

[54 FR 24545, June 8, 1989, as amended at 60 FR 10797, Feb. 28, 1995]



Sec. 1210.303  Plan.

    Plan means this watermelon research and promotion Plan issued by the 
Secretary pursuant to the Act.



Sec. 1210.304  Board.

    Board means the National Watermelon Promotion Board, hereinafter 
established pursuant to Sec. 1210.320.



Sec. 1210.305  Watermelon.

    Watermelon means all varieties of the Family Curcubitaceae; Genus 
and Species; Citrullus Lanatus, popularly referred to as watermelon 
grown by producers in the United States or imported into the United 
States.

[60 FR 10797, Feb. 28, 1995]



Sec. 1210.306  Producer.

    Producer means any person engaged in the growing of 10 acres or more 
of watermelons including any person who owns or shares the ownership and 
risk of loss of such watermelon crop.

[54 FR 24545, June 8, 1989, as amended at 60 FR 10797, Feb. 28, 1995]



Sec. 1210.307  Handle.

    Handle means to grade, pack, process, sell, transport, purchase, or 
in any

[[Page 95]]

other way to place or cause watermelons to which one has title or 
possession to be placed in the current of commerce. Such term shall not 
include the transportation or delivery of field run watermelons by the 
producer thereof to a handler for grading, sizing or processing.



Sec. 1210.308  Handler.

    Handler means any person (except a common or contract carrier of 
watermelons owned by another person) who handles watermelons, including 
a producer who handles watermelons of the producer's own production. For 
the purposes of this subpart, the term ``handler'' means the ``first'' 
person who performs the handling functions.



Sec. 1210.309  Person.

    Person means any individual, group of individuals, partnership, 
corporation, association, cooperative, or other entity.



Sec. 1210.310  Fiscal period and marketing year.

    Fiscal period and marketing year mean the 12 month period from 
January 1 to December 31 or such other period which may be approved by 
the Secretary.



Sec. 1210.311  Programs and projects.

    Programs and projects mean those research, development, advertising, 
or promotion programs or projects developed by the Board pursuant to 
Sec. 1210.331.



Sec. 1210.312  Promotion.

    Promotion means any action taken by the Board, pursuant to the Act, 
to present a favorable image for watermelons to the public with the 
express intent of improving the competitive position of watermelons in 
the marketplace and stimulating sales of watermelons, and shall include, 
but not be limited to, paid advertising.



Sec. 1210.313  Research.

    Research means any type of systematic study or investigation, and/or 
the evaluation of any study or investigation designed to advance the 
image, desirability, usage, marketability, production, or quality of 
watermelons.



Sec. 1210.314  Importer.

    Importer means any person who imports watermelons into the United 
States as a principal or as an agent, broker, or consignee for any 
person who produces watermelons outside of the United States for sale in 
the United States.

[60 FR 10797, Feb. 28, 1995]



Sec. 1210.315  United States.

    United States means each of the several States and the District of 
Columbia.

[60 FR 10797, Feb. 28, 1995]

                   National Watermelon Promotion Board



Sec. 1210.320  Establishment and membership.

    (a) There is hereby established a National Watermelon Promotion 
Board, hereinafter called the ``Board.'' The Board shall be composed of 
producers, handlers, importers, and one public representative appointed 
by the Secretary. An equal number of producer and handler 
representatives shall be nominated by producers and handlers pursuant to 
Sec. 1210.321. The Board shall also include one or more representatives 
of importers, who shall be nominated in such manner as may be prescribed 
by the Secretary. The public representative shall be nominated by the 
Board members in such manner as may be prescribed by the Secretary. If 
producers, handlers, and importers fail to select nominees for 
appointment to the Board, the Secretary may appoint persons on the basis 
of representation as provided in Sec. 1210.324. If the Board fails to 
adhere to procedures prescribed by the Secretary for nominating a public 
representative, the Secretary shall appoint such representative.
    (b) Membership on the Board shall be determined on the basis of two 
handler and two producer representatives for each of seven districts in 
the contiguous States of the United States. Such districts as hereby 
established have approximately equal production volume according to the 
three-year average production as set forth in the USDA Crop Production 
Annual Summary Reports for 1979, 1980, and 1981. They are:


[[Page 96]]


District #1--South Florida including all areas south of State Highway 
50.
District #2--North Florida including all areas north of State Highway 
50.
District #3--The States of Alabama and Georgia.
District #4--The States of South Carolina, North Carolina, Virginia, 
Delaware, Maryland, West Virginia, Pennsylvania, New Jersey, New York, 
Ohio, Michigan, Connecticut, Rhode Island, Massachusetts, Vermont, New 
Hampshire, and Maine.
District #5--The States of Mississippi, Kentucky, Tennessee, Louisiana, 
Arkansas, Missouri, Illinois, Indiana, Iowa, Kansas, Nebraska, Oklahoma, 
Wisconsin, Minnesota, North Dakota, South Dakota, Colorado, and New 
Mexico.
District #6--The State of Texas.
District #7--The States of Arizona, California, Nevada, Utah, Oregon, 
Idaho, Wyoming, Washington, and Montana.

    (c) After two years, the Board shall review the districts to 
determine whether realignment of the districts is necessary and at least 
every five years thereafter the Board shall make such a review. In 
making such review, it shall give consideration to:
    (1) The most recent three years USDA production reports or Board 
assessment reports if USDA production reports are unavailable;
    (2) Shifts and trends in quantities of watermelon produced, and
    (3) Other relevant factors.

As a result of this review, the Board may realign the districts subject 
to the approval of the Secretary. Any such realignment shall be 
recommended by the Board to the Secretary at least six months prior to 
the date of the call for nominations and shall become effective at least 
30 days prior to such date.
    (d) Importer representation on the Board shall be proportionate to 
the percentage of assessments paid by importers to the Board, except 
that at least one representative of importers shall serve on the Board.
    (e) Not later than 5 years after the date that importers are subject 
to the Plan, and every 5 years thereafter, the Secretary shall evaluate 
the average annual percentage of assessments paid by importers during 
the 3-year period preceding the date of the evaluation and adjust, to 
the extent practicable, the number of importer representatives on the 
Board.
    (f) The Board consists of 14 producers, 14 handlers, at least one 
importer, and one public member appointed by the Secretary.

[54 FR 24545, June 8, 1989, as amended at 60 FR 10797, Feb. 28, 1995]



Sec. 1210.321  Nominations and selection.

    The Secretary shall appoint the members of the Board from 
nominations to be made in the following manner:
    (a) There shall be two individuals nominated for each vacant 
position.
    (b) The Board shall issue a call for nominations by February first 
of each year in which an election is to be held. The call shall include 
at a minimum, the following information:
    (1) A list of the vacancies and qualifications as to producers and 
handlers by district and to importers nationally for which nominees may 
be submitted.
    (2) The date by which the nominees shall be submitted to the 
Secretary for consideration to be in compliance with Sec. 1210.323 of 
this subpart.
    (3) A list of those States, by district, entitled to participate in 
the nomination process.
    (4) The date, time, and location of any next scheduled meeting of 
the Board, national and State producer or handler associations, 
importers, and district conventions, if any.
    (c) Nominations for producer and handler positions that will become 
vacant shall be made by district convention in the district entitled to 
nominate. Notice of such convention shall be publicized to all producers 
and handlers within such district, and the Secretary at least ten days 
prior to said event. The notice shall have attached to it the call for 
nominations from the Board. The responsibility for convening and 
publicizing the district convention shall be that of the then members of 
the Board from that district.
    (d) Nominations for importers positions that become vacant may be 
made by mail ballot, nomination conventions, or by other means 
prescribed by the Secretary. The Board shall provide notice of such 
vacancies and the nomination process to all importers through press 
releases and any other available means as well as direct mailing to 
known importers. All importers may

[[Page 97]]

participate in the nomination process: Provided, That a person who both 
imports and handles watermelons may vote for importer members and serve 
as an importer member if that person imports 50 percent or more of the 
combined total volume of watermelons handled and imported by that 
person.
    (e) All producers and handlers within the district may participate 
in the convention: Provided, That a person that produces and handles 
watermelons may vote for handler members only if the producer purchased 
watermelons from other producers, in a combined total volume that is 
equal to 25 percent or more of the producer's own production; or the 
combined total volume of watermelon handled by the producer from the 
producer's own production and purchases from other producer's production 
is more than 50 percent of the producer's own production; and provided 
further, That if a producer or handler is engaged in the production or 
handling of watermelons in more than one State or district, the producer 
or handler shall participate within the State or district in which the 
producer or handler so elects in writing to the Board and such election 
shall remain controlling until revoked in writing to the Board.
    (f) The district convention chairperson shall conduct the selection 
process for the nominees in accordance with procedures to be adopted at 
each such convention, subject to requirements set in Sec. 1210.321(e).
    (1) No State in Districts 3, 4, 5, and 7 as currently constituted 
shall have more than three producers and handlers representatives 
concurrently on the Board.
    (2) Each State represented at the district convention shall have one 
vote for each producer position and one vote for each handler position 
from the District on the Board, which vote shall be determined by the 
producers and handlers from that State by majority vote. Each State 
shall further have an additional vote for each five hundred thousand 
hundredweight volume as determined by the three year average annual crop 
production summary reports of the USDA, or if such reports are not 
published, then the three year average of the Board assessment reports; 
Provided, That for the first two calls for nominees, the USDA Crop 
Production Annual Summary Reports for 1979, 1980, and 1981 will be 
controlling as to any additional production volume votes.

[54 FR 24545, June 8, 1989, as amended at 60 FR 10798, Feb. 28, 1995]



Sec. 1210.322  Term of office.

    (a) The term of office of Board members shall be three years.
    (b) Except in the case of mid-term vacancies, the term of office 
shall begin on January 1, or such other date as may be recommended by 
the Board and approved by the Secretary.
    (c) Board members shall serve during the term of office for which 
they are selected and have qualified, and until their successors are 
selected and have qualified.
    (d) No person shall serve more than two successive terms of office.

[54 FR 24545, June 8, 1989, as amended at 60 FR 10798, Feb. 28, 1995; 60 
FR 13515, Mar. 13, 1995]



Sec. 1210.323  Acceptance.

    Each person nominated for membership on the Board shall qualify by 
filing a written acceptance with the Secretary. Such written acceptance 
shall accompany the nominations list required by Sec. 1210.321.



Sec. 1210.324  Vacancies.

    (a) In the event any member of the Board ceases to be a member of 
the category of members from which the member was appointed to the 
Board, such position shall automatically become vacant.
    (b) If a member of the Board consistently refuses to perform the 
duties of a member of the Board, or if a member of the Board engages in 
acts of dishonesty or willful misconduct, the Board may recommend to the 
Secretary that the member be removed from office. If the Secretary finds 
the recommendation of the Board shows adequate cause, the Secretary 
shall remove such member from office. Further, without recommendation of 
the Board, a member may be removed by the Secretary upon showing of 
adequate cause, if the Secretary determines that the person's

[[Page 98]]

continual services would be detrimental to the purposes of the Act.
    (c) To fill any vacancy caused by the failure of any person selected 
as a member of the Board to qualify, or in the event of the death, 
removal, resignation, or disqualification of any member, a successor 
shall be nominated and selected in the manner specified in Sec. 
1210.321, except that said nomination and replacement shall not be 
required if the unexpired term of office is less than six months. In the 
event of failure to provide nominees for such vacancies, the Secretary 
may appoint other eligible persons.



Sec. 1210.325  Procedure.

    (a) A simple majority of Board members shall constitute a quorum and 
any action of the Board shall require the concurring votes of a majority 
of those present and voting. At assembled meetings all votes shall be 
cast in person.
    (b) For routine and noncontroversial matters which do not require 
deliberation and the exchange of views, and for matters of an emergency 
nature when there is not enough time to call an assembled meeting, the 
Board may act upon a majority of concurring votes of its members cast by 
mail, telegraph, telephone, or by other means of communication; 
Provided, That each member receives an accurate, full, and substantially 
identical explanation of each proposition. Telephone votes shall be 
promptly confirmed in writing. All votes shall be recorded in the Board 
minutes.

[54 FR 24545, June 8, 1989, as amended at 60 FR 10798, Feb. 28, 1995]



Sec. 1210.326  Compensation and reimbursement.

    Board members shall serve without compensation but shall be 
reimbursed for reasonable expenses incurred by them in the performance 
of their duties as Board members.



Sec. 1210.327  Powers.

    The Board shall have the following powers subject to Sec. 1210.363:
    (a) To administer the provisions of this Plan in accordance with its 
terms and conditions;
    (b) To make rules and regulations to effectuate the terms and 
conditions of this Plan;
    (c) To require its employees to receive, investigate, and report to 
the Secretary complaints of violations of this Plan; and
    (d) To recommend to the Secretary amendments to this Plan.



Sec. 1210.328  Duties.

    The Board shall, among other things, have the following duties:
    (a) To meet, organize, and select from among its members a president 
and such other officers as may be necessary; to select committees and 
subcommittees of board members; to adopt such rules for the conduct of 
its business as it may deem advisable; and it may establish working 
committees of persons other than Board members.
    (b) To employ such persons as it may deem necessary and to determine 
the compensation and define the duties of each; and to protect the 
handling of Board funds through fidelity bonds;
    (c) To prepare and submit for the Secretary's approval, prior to the 
beginning of each fiscal period, a recommended rate of assessment and a 
fiscal period budget of the anticipated expenses in the administration 
of this Plan, including the probable costs of all programs and projects;
    (d) To develop programs and projects, which must be approved by the 
Secretary before becoming effective, and enter into contracts or 
agreements, with the approval of the Secretary, for the development and 
carrying out of programs or projects of research, development, 
advertising or promotion, and the payment of the costs thereof with 
funds received pursuant to this Plan;
    (e) To keep minutes, books, and records which clearly reflect all of 
the acts and transactions of the Board. Minutes of each Board meeting 
shall be promptly reported to the Secretary;
    (f) To prepare and submit to the Secretary such reports from time to 
time as may be prescribed for appropriate accounting with respect to the 
receipt and disbursement of funds entrusted to the Board;

[[Page 99]]

    (g) To cause the books of the Board to be audited by a certified 
public accountant at least once each fiscal period, and at such other 
time as the Board may deem necessary. The report of such audit shall 
show the receipt and expenditure of funds received pursuant to this 
part. Two copies of each such report shall be furnished to the Secretary 
and a copy of each such report shall be made available at the principal 
office of the Board for inspection by producers, handlers, and 
importers;
    (h) To investigate violations of the Plan and report the results of 
such investigations to the Secretary for appropriate action to enforce 
the provisions of the Plan;
    (i) To periodically prepare, make public, and make available to 
producers, handlers, and importers reports of its activities carried 
out.
    (j) To give the Secretary the same notice of meetings of the Board 
and its subcommittees as is given to its members;
    (k) To act as intermediary between the Secretary and any producer, 
handler, or importer;
    (l) To furnish the Secretary such information as the Secretary may 
request;
    (m) To notify watermelon producers, handlers, and importers of all 
Board meetings through press releases or other means;
    (n) To appoint and convene, from time to time, working committees 
drawn from producers, handlers, importers, and the public to assist in 
the development of research and promotion programs for watermelons; and
    (o) To develop and recommend such rules and regulations to the 
Secretary for approval as may be necessary for the development and 
execution of programs or projects to effectuate the declared purpose of 
the Act.

[54 FR 24545, June 8, 1989, as amended at 60 FR 10798, Feb. 28, 1995]

                         Research and Promotion



Sec. 1210.330  Policy and objective.

    It shall be the policy of the Board to carry out an effective, 
continuous, and coordinated program of research, development, 
advertising, and promotion in order to:
    (a) Strengthen watermelons' competitive position in the marketplace,
    (b) Maintain and expand existing domestic and foreign markets, and
    (c) Develop new or improved markets.

It shall be the objective of the Board to carry out programs and 
projects which will provide maximum benefit to the watermelon industry.



Sec. 1210.331  Programs and projects.

    The Board shall develop and submit to the Secretary for approval any 
programs or projects authorized in this section. Such programs or 
projects shall provide for:
    (a) The establishment, issuance, effectuation and administration of 
appropriate programs or projects for advertising and other sales 
promotion of watermelons designed to strengthen the position of the 
watermelon industry in the marketplace and to maintain, develop, and 
expand markets for watermelon;
    (b) Establishing and carrying out research and development projects 
and studies to the end that the acquisition of knowledge pertaining to 
watermelons or their consumption and use may be encouraged or expanded, 
or to the end that the marketing and use of watermelons may be 
encouraged, expanded, improved, or made more efficient: Provided, That 
quality control, grade standards, supply management programs or other 
programs that would otherwise limit the right of the individual 
watermelon producer to produce watermelons shall not be conducted under, 
or as a part of, this Plan;
    (c) The development and expansion of watermelon sales in foreign 
markets;
    (d) A prohibition on advertising or other promotion programs that 
make any reference to private brand names or use false or unwarranted 
claims on behalf of watermelons or false or unwarranted statements with 
respect to the attributes or use of any competing product;
    (e) Periodic evaluation by the Board of each program or project 
authorized under this Plan to insure that each program or project 
contributes to an effective and coordinated program of

[[Page 100]]

research and promotion and submission of such evaluation to the 
Secretary. If the Board or the Secretary finds that a program or project 
does not further the purposes of the Act, then the Board or the 
Secretary shall terminate such program or project; and
    (f) The Board to enter into contracts or make agreements for the 
development and carrying out of research and promotion and pay for the 
costs of such contracts or agreements with funds collected pursuant to 
Sec. 1210.341.

                        Expenses and Assessments



Sec. 1210.340  Budget and expenses.

    (a) Prior to the beginning of each fiscal period, or as may be 
necessary thereafter, the Board shall prepare and recommend a budget on 
a fiscal period basis of its anticipated expenses and disbursements in 
the administration of this Plan, including probable costs of research, 
development, advertising, and promotion. The Board shall also recommend 
a rate of assessment calculated to provide adequate funds to defray its 
proposed expenditures and to provide for a reserve as set forth in Sec. 
1210.344.
    (b) The Board is authorized to incur such expenses for research, 
development, advertising, or promotion of watermelons, such other 
expenses for the administration, maintenance, and functioning of the 
Board as may be authorized by the Secretary, and any referendum and 
administrative costs incurred by the Department of Agriculture. The 
funds to cover such expenses shall be paid from assessments received 
pursuant to Sec. 1210.341.

[54 FR 24545, June 8, 1989, as amended at 60 FR 10798, Feb. 28, 1995]



Sec. 1210.341  Assessments.

    (a) During the effective period of this subpart, assessments shall 
be levied on all watermelons produced and first handled in the United 
States and all watermelons imported into the United States for 
consumption as human food. No more than one assessment on a producer, 
handler, or importer shall be made on any lot of watermelons. The 
handler shall be assessed an equal amount on a per unit basis as the 
producer. If a person performs both producing and handling functions on 
any same lot of watermelons, both assessments shall be paid by such 
person. In the case of an importer, the assessment shall be equal to the 
combined rate for domestic producers and handlers and shall be paid by 
the importer at the time of entry of the watermelons into the United 
States.
    (b) Assessment rates shall be fixed by the Secretary in accordance 
with section 1647(f) of the Act. No assessments shall be levied on 
watermelons grown by producers of less than 10 acres of watermelons.
    (c) Each handler, as defined, is responsible for payment to the 
Board of both the producer's and the handler's assessment pursuant to 
regulations issued hereunder. The handler may collect producer 
assessments from the producer or deduct such assessments from the 
proceeds paid to the producer on whose watermelons the assessments are 
made. The handler shall maintain separate records for each producer's 
watermelons handled, including watermelons produced by said handler. In 
addition, the handler shall indicate the total quantity of watermelons 
handled by the handler, including those that are exempt under this Plan, 
and such other information as may be prescribed by the Board.
    (d) Each importer shall be responsible for payment of the assessment 
to the Board on watermelons imported into the United States through the 
U.S. Customs Service or in such other manner as may be established by 
rules and regulations approved by the Secretary.
    (e) Producer-handlers and handlers shall pay assessments to the 
Board at such time and in such manner as the Board, with the Secretary's 
approval, directs, pursuant to regulations issued under this part. Such 
regulations may provide for different handlers or classes of handlers 
and different handler payment and reporting schedules to recognize 
differences in marketing practices or procedures used in any State or 
production area.
    (f) There shall be a late payment charge imposed on any handler or 
importer who fails to remit to the Board the total amount for which any 
such

[[Page 101]]

handler or importer is liable on or before the payment due date 
established by the Board under paragraph (e) of this section. The amount 
of the late payment charge shall be set by the Board subject to approval 
by the Secretary.
    (g) There shall also be imposed on any handler or importer subject 
to a late payment charge, an additional charge in the form of interest 
on the outstanding portion of any amount for which the handler or 
importer is liable. The rate of such interest shall be prescribed by the 
Board subject to approval by the Secretary.
    (h) The Board is hereby authorized to accept advance payment of 
assessments by handlers and importers that shall be credited toward any 
amount for which the handlers and importers may become liable. The Board 
shall not be obligated to pay interest on any advance payment.
    (i) The Board is hereby authorized to borrow money for the payment 
of administrative expenses subject to the same fiscal, budget, and audit 
controls as other funds of the Board.
    (j) The Board may authorize other organizations to collect 
assessments in its behalf with the approval of the Secretary. Any 
reimbursement by the Board for such services shall be based on 
reasonable charges for services rendered.

[54 FR 24545, June 8, 1989, as amended at 60 FR 10798, Feb. 28, 1995]



Sec. 1210.342  Exemption from assessment.

    (a) The Board may exempt watermelons used for nonfood purposes from 
the provisions of this Plan and shall establish adequate safeguards 
against improper use of such exemptions.
    (b) Importers of less than 150,000 pounds of watermelons per year 
shall be entitled to apply for a refund that is equal to the rate of 
assessment paid by domestic producers.
    (c) The Secretary may adjust the quantity of the weight exemption 
specified in paragraph (b) of this section on the recommendation of the 
Board after an opportunity for public notice and comment to reflect 
significant changes in the 5-year average yield per acre of watermelons 
produced in the United States.
    (d) The Board shall have the authority to establish rules, with the 
approval of the Secretary, for certifying whether a person meets the 
definition of a producer under section 1210.306.

[54 FR 24545, June 8, 1989, as amended at 60 FR 10799, Feb. 28, 1995]



Sec. 1210.343  [Reserved]



Sec. 1210.344  Operating reserve.

    The Board may establish an operating monetary reserve and may carry 
over to subsequent fiscal periods excess funds in a reserve so 
established; Provided, That funds in the reserve shall not exceed 
approximately two fiscal periods' expenses. Such reserve funds may be 
used to defray any expenses authorized under this subpart.

                       Reports, Books, and Records



Sec. 1210.350  Reports.

    (a) Each handler shall maintain a record with respect to each 
producer for whom watermelons were handled and for watermelons produced 
and handled by the handler. Handlers shall report to the Board at such 
times and in such manner as the Board may prescribe by regulations 
whatever information as may be necessary in order for the Board to 
perform its duties. Such reports may include, but shall not be limited 
to, the following information:
    (1) Total quantity of watermelons handled for each producer and by 
the handler, including those which are exempt under this Plan;
    (2) Total quantity of watermelons handled for each producer and by 
the handler, on which the producer assessment was collected;
    (3) Name and address of each person from whom an assessment was 
collected, the amount collected from each person, and the date such 
collection was made; and
    (4) Name and address of each person claiming exemption from 
assessment and a copy of each such person's claim of exemption.
    (b) Each importer of watermelons shall maintain a separate record 
that includes a record of:
    (1) The total quantity of watermelons imported into the United 
States that

[[Page 102]]

are included under the terms of this Plan;
    (2) The total quantity of watermelons that are exempt from the Plan; 
and
    (3) Such other information as may be prescribed by the Board.
    (c) Each importer shall report to the Board at such times and in 
such manner as it may prescribe such information as may be necessary for 
the Board to perform its duties under this part.

[54 FR 24545, June 8, 1989, as amended at 60 FR 10799, Feb. 28, 1995]



Sec. 1210.351  Books and records.

    Each handler and importer subject to this Plan shall maintain, and 
during normal business hours make available for inspection by employees 
of the Board or Secretary, such books and records as are necessary to 
carry out the provisions of this Plan and the regulations issued 
thereunder, including such records as are necessary to verify any 
required reports. Such records shall be maintained for 2 years beyond 
the fiscal period of their applicability.

[54 FR 24545, June 8, 1989, as amended at 60 FR 10799, Feb. 28, 1995]



Sec. 1210.352  Confidential treatment.

    (a) All information obtained from the books, records, or reports 
required to be maintained under Sec. Sec. 1210.350 and 1210.351 shall 
be kept confidential and shall not be disclosed to the public by any 
person. Only such information as the Secretary deems relevant shall be 
disclosed to the public and then only in a suit or administrative 
hearing brought at the direction, or on the request, of the Secretary, 
or to which the Secretary or any officer of the United States is a 
party, and involving this Plan: Except that nothing in this subpart 
shall be deemed to prohibit:
    (1) The issuance of general statements based on the reports of a 
number of handlers or importers subject to this Plan if such statements 
do not identify the information furnished by any person; or
    (2) The publication by direction of the Secretary of the name of any 
person violating this Plan together with a statement of the particular 
provisions of this Plan violated by such person.
    (b) Any disclosure of confidential information by any employee of 
the Board, except as required by law, shall be considered willful 
misconduct.

[54 FR 24545, June 8, 1989, as amended at 60 FR 10799, Feb. 28, 1995]

                              Miscellaneous



Sec. 1210.360  Right of the Secretary.

    All fiscal matters, programs or projects, rules or regulations, 
reports, or other substantive actions proposed and prepared by the Board 
shall be submitted to the Secretary for approval.



Sec. 1210.361  Personal liability.

    No member or employee of the Board shall be held personally 
responsible, either individually or jointly with others, in any way 
whatsoever to any person for errors in judgment, mistakes, or other 
acts, either of commission or omission, as such member or employee, 
except for acts of dishonesty or willful misconduct.



Sec. 1210.362  Influencing government action.

    No funds received by the Board under this Plan shall in any manner 
be used for the purpose of influencing governmental policy or action, 
except for making recommendations to the Secretary as provided in this 
subpart.

[54 FR 24545, June 8, 1989, as amended at 60 FR 10799, Feb. 28, 1995]



Sec. 1210.363  Suspension or termination.

    (a) Whenever the Secretary finds that this Plan or any provision 
thereof obstructs or does not tend to effectuate the declared policy of 
the Act, the Secretary shall terminate or suspend the operation of this 
Plan or such provision thereof.
    (b) The Secretary may conduct a referendum at any time and shall 
hold a referendum on request of the Board or at least 10 percent of the 
combined total of the watermelon producers, handlers, and importers to 
determine if watermelon producers, handlers, and importers favor 
termination or suspension of this Plan. The Secretary shall suspend or 
terminate this Plan at the end of the marketing year whenever

[[Page 103]]

the Secretary determines that the suspension or termination is favored 
by a majority of the watermelon producers, handlers, and importers 
voting in such referendum who, during a representative period determined 
by the Secretary, have been engaged in the production, handling, or 
importing of watermelons and who produced, handled, or imported more 
than 50 percent of the combined total of the volume of watermelons 
produced, handled, or imported by those producers, handlers, and 
importers voting in the referendum. For purposes of this section, the 
vote of a person who both produces and handles watermelons will be 
counted as a handler vote if the producer purchased watermelons from 
other producers, in a combined total volume that is equal to 25 percent 
or more of the producer's own production; or the combined total volume 
of watermelon handled by the producer from the producer's own production 
and purchases from other producer's production is more than 50 percent 
of the producer's own production. Provided, That the vote of a person 
who both imports and handles watermelons will be counted as an importer 
vote if that person imports 50 percent or more of the combined total 
volume of watermelons handled and imported by that person. Any such 
referendum shall be conducted by mail ballot.

[54 FR 24545, June 8, 1989, as amended at 60 FR 10799, Feb. 28, 1995]



Sec. 1210.364  Proceedings after termination.

    (a) Upon the termination of this Plan, the Board shall recommend not 
more than five of its members to the Secretary to serve as trustees for 
the purpose of liquidating the affairs of the Board. Such persons, upon 
designation by the Secretary, shall become trustees of all funds and 
property then in possession or under control of the Board, including 
claims for any funds unpaid or property not delivered or any other claim 
existing at the time of such termination.
    (b) The said trustees shall:
    (1) Continue in such capacity until discharged by the Secretary;
    (2) Carry out the obligations of the Board under any contracts or 
agreements entered into by it pursuant to Sec. 1210.328(d);
    (3) From time-to-time account for all receipts and disbursements and 
deliver all property on hand, together with all books and records of the 
Board and of the trustees, to person or persons as the Secretary may 
direct; and
    (4) Upon the request of the Secretary execute such assignments or 
other instruments necessary or appropriate to vest in such person or 
persons full title and right to all the funds, property, and claims 
vested in the Board or the trustees pursuant to this section.
    (c) Any person to whom funds, property, or claims have been 
transferred or delivered pursuant to this section shall be subject to 
the same obligation imposed upon the Board and upon the trustees.
    (d) A reasonable effort shall be made by the Board or its trustees 
to return to producers, handlers and importers any residual funds not 
required to defray the necessary expenses of liquidation. If it is found 
impractical to return such remaining funds to producers, handlers and 
importers such funds shall be disposed of in such manner as the 
Secretary may determine to be appropriate.

[54 FR 24545, June 8, 1989, as amended at 60 FR 10799, Feb. 28, 1995]



Sec. 1210.365  Effect of termination or amendment.

    Unless otherwise expressly provided by the Secretary, the 
termination of this Plan or any regulation issued pursuant thereto, or 
the issuance of any amendment to either thereof, shall not:
    (a) Affect or waive any right, duty, obligation, or liability which 
shall have arisen or which may thereafter arise in connection with any 
provision of this Plan or any regulation issued thereunder; or
    (b) Release or extinguish any violation of this Plan or any 
regulation issued thereunder; or
    (c) Affect or impair any rights or remedies of the United States, or 
of the Secretary, or of any other person with respect to any such 
violation.



Sec. 1210.366  Separability.

    If any provision of this Plan is declared invalid or the 
applicability

[[Page 104]]

thereof to any person or circumstance is held invalid, the validity of 
the remainder of this Plan or applicability thereof to other persons or 
circumstances shall not be affected thereby.



Sec. 1210.367  Patents, copyrights, inventions, and publications.

    Any patents, copyrights, inventions, product formulations, or 
publications developed through the use of funds collected under the 
provisions of this Plan shall be the property of the United States 
government as represented by the Board. Funds generated by such patents, 
copyrights, inventions, product formulations, or publications shall be 
considered income subject to the same fiscal, budget, and audit controls 
as other funds of the Board. Upon termination of this part, Sec. 
1210.364 shall apply to determine the disposition of all such property.



                     Subpart B_Nominating Procedures

    Source: 54 FR 38205, Sept. 15, 1989, unless otherwise noted.

                      Producer and Handler Members



Sec. 1210.400  Terms defined.

    Unless otherwise defined in this subpart, definitions of terms used 
in this subpart shall have the same meaning as the definitions of such 
terms which appear in Subpart--Watermelon Research and Promotion Plan.



Sec. 1210.401  District conventions.

    (a) Except for the initial district convention in each district, 
which will be called and opened by a representative of the Secretary, 
the Board shall call and open all district conventions.
    (b) District conventions are to be held to nominate producers and 
handlers as candidates for membership on the National Watermelon 
Promotion Board. Each district, as defined in Sec. 1210.501, is 
entitled to two producer and two handler members on the Board.
    (c) There shall be two individuals nominated for each vacant 
position. In multi-State districts, no one State shall have nominees for 
more than three of the four district positions on the Board.
    (d) All producers and handlers within each district may participate 
in that district's convention: Provided, That they meet the eligibility 
provisions set forth in Sec. 1210.402 of this subpart.
    (e) The convention chairperson shall be elected as provided in Sec. 
1210.403(b) of this subpart.
    (f) The Board member nomination process shall be conducted by the 
chairperson in conformance with the provisions of Sec. 1210.321 of the 
Plan and Sec. 1210.403 of this subpart. At the conclusion of the 
district convention for the initial term of office, the chairperson will 
provide the Secretary with:
    (1) The identification of that district's two nominees for each 
producer and handler position on the Board, and
    (2) A typed copy of the district convention's minutes.

This information must be provided by the chairperson to the Board staff 
in a manner that will ensure receipt, at the address specified in the 
call for the district convention, within 14 calendar days of the 
district convention's completion, but not later than July 8 for 
appointments to become effective on the following January 1. The Board 
staff must forward such information to the Secretary, in a manner that 
will ensure receipt, within 21 calendar days of completion of the 
district convention, but not later than July 15 for appointments to 
become effective on the following January 1. Further, the chairperson 
will immediately arrange for completion of qualification statements and 
other specified information by each nominee, and each nominee shall 
qualify by forwarding such information to the Board's office within 14 
calendar days of completion of the district convention, but not later 
than July 8 for appointments to become effective on the following 
January 1. The Board staff must forward the completed qualification 
statements and other specified information to the Secretary, in a manner 
that will ensure receipt within 21 calendar days of completion of the 
district convention, but not later than July 15 for appointments

[[Page 105]]

to become effective on the following January 1.

[54 FR 38205, Sept. 15, 1989, as amended at 58 FR 3355, Jan. 8, 1993; 59 
FR 18948, Apr. 21, 1994; 60 FR 10799, Feb. 28, 1995]



Sec. 1210.402  Voter and board member nominee eligibility.

    (a) All producers and handlers within a district may participate in 
their district convention for the purpose of nominating candidates for 
appointment to the Board: Provided, That a producer who both produces 
and handles watermelons may vote for handler member nominees and serve 
as a handler member nominee only if the producer purchased watermelons 
from other producers, in a combined total volume that is equal to 25 
percent or more of the producer's own production or the combined total 
volume of watermelons handled by the producer from the producer's own 
production and purchases from other producer's production is more than 
50 percent of the producer's own production; and Provided further, That 
if a producer or handler is engaged in the production or handling of 
watermelons in more than one State or district, the producer or handler 
shall participate within the State or district in which the producer or 
handler so elects in writing to the Board and such election shall remain 
controlling until revoked in writing to the Board. For the purpose of 
participation in initial nominating conventions, such election shall be 
made in writing, at the address provided, to the Department official 
identified in the call for a district convention.
    (b) Any individual, group of individuals, partnership, corporation, 
association, cooperative or any other entity which is engaged in the 
production, first handling or importing of watermelons is considered a 
person and as such is entitled to only one vote, except that such person 
may cast proxy votes as provided in Sec. 1210.403 and Sec. 1210.404 of 
this subpart.
    (c) All producers and handlers attending their district conventions 
may be candidates for one or more of the positions of State 
spokesperson, district convention chairperson, and producer or handler 
nominee.

[54 FR 38205, Sept. 15, 1989, as amended at 60 FR 10799, Feb. 28, 1995]



Sec. 1210.403  Voting procedures.

    (a) Proxy voting by producers and handlers for producer and handler 
nominees shall be permitted at all district conventions: Provided, That 
producers may cast proxy votes for producers only, and handlers may cast 
proxy votes for handlers only. In non-multi-State districts, proxy 
voting shall be permitted for all producer and handler nominee balloting 
to determine the districts' nominees. In multi-State districts, proxy 
voting shall be permitted for all producers and handlers participating 
in a State's balloting to determine the State's nominees. No other proxy 
voting, such as for district convention chairperson, shall be allowed. 
Any person wanting to cast proxy votes must demonstrate authorization to 
do so. Authority to cast a proxy vote on behalf of another person shall 
be demonstrated through documentation containing:
    (1) The proxy voter's name, address, and telephone number;
    (2) Signature and date signed;
    (3) A certification identifying the proxy voter as a producer or a 
handler; and
    (4) A statement identifying the person being given authority by the 
proxy voter to cast the proxy vote.

All proxy documentation must be received by the Board at its 
headquarters address at least two weeks before the district convention 
is scheduled to convene. For the purpose of the initial district 
convention, all proxy documentation must be forwarded to the Department 
representative identified in the call for the district convention in a 
manner that will ensure receipt, at the address specified in the call, 
at least 72 hours before the district convention is scheduled to 
convene. The Board, or in the case of the initial conventions the 
Department representative identified in the call or other representative 
of the Department, may challenge any proxy vote and disqualify any 
challenged vote for cause. In the case of duplicate proxy authorizations 
by any

[[Page 106]]

person, only the first authorization, determined by date will be 
allowed. In the case of duplicate dates, the proxy which is received 
first will be allowed.
    (b) In non-multi-State districts, convention chairpersons shall be 
elected by a majority vote of the eligible voters in attendance. In 
multi-State districts, the election shall be by majority vote of all 
States present with each State's vote(s) determined by a majority vote 
of the eligible voters of that State in attendance. Each such State is 
entitled to one vote, plus one additional vote for each 500,000 
hundredweight volume of production in the State as determined by the 
three-year average annual crop production summary reports of the 
Department or, if such reports are not published, then the three-year 
average of the Board's assessment reports: Provided, That for the first 
two conventions, the Department's Crop Production Annual Summary Reports 
for 1979, 1980, and 1981 will be controlling as to any additional 
production volume votes.
    (c) In multi-State districts 3, 4, 5 and 7, the convention 
chairperson will direct the eligible producer voters and handler voters 
from each State to caucus separately for the purpose of electing a State 
spokesperson for each group. Election of each State spokesperson shall 
be by simple majority of all individual voters in attendance. In lieu of 
written ballots, a State spokesperson may be elected by voice vote or a 
show of hands. The role of the State spokesperson is to coordinate State 
voting and to cast all State votes.
    (d) Convention chairpersons will coordinate the entire producer and 
handler nomination process. In conducting the nomination process, each 
convention chairperson will ensure that:
    (1) Voting for producer nominees is limited to producers, and voting 
for handler nominees is limited to handlers; and
    (2) Producer candidates for nomination are producers, and handler 
candidates for nomination are handlers.
    (e) Voting, for producer and handler nominees, in non-multi-State 
districts shall be on the basis of one vote per person, except that 
persons authorized to cast proxy votes shall be allowed to cast all 
proxy votes not disallowed by the Board or the Department. Election of 
nominees shall be on the basis of a simple majority of all eligible 
votes cast.
    (f) Voting for producer and handler nominees in multi-State 
districts shall be on a State by State basis. Producers and handlers 
from each State shall caucus separately, at the district convention, for 
the purpose of determining which nominees shall receive their State's 
vote(s) for membership on the Board. Each State's vote(s) shall be based 
on a simple majority of all votes (including proxy votes) cast by 
producers or handlers voting in their State's caucus. Each State 
represented at a multi-State district convention shall have one vote for 
each producer position and one vote for each handler position from the 
district on the Board. Each State shall further have an additional vote 
toward each position for each 500,000 hundredweight volume of production 
in the State as determined by the three-year average annual crop 
production summary reports of the Department or, if such reports are not 
published, then the three-year average of the Board's assessment 
reports: Provided, That for the first two calls for nominees, the 
Department's Crop Production Annual Summary Reports for 1979, 1980, and 
1981 will be controlling as to any additional production volume votes. 
Each State spokesperson will cast the State's vote(s) for each nominee 
position. Election of nominees shall be on the basis of a simple 
majority of all State votes cast.
    (g) During the voting for convention chairperson, State 
spokesperson, and Board member nominee, should no candidate receive the 
required simple majority on the first ballot, the number of candidates 
may be reduced by dropping one or more of the lowest vote recipients 
from the list of candidates. The balloting will be repeated until the 
position is filled.
    (h) Two nominees shall be elected for each of the producer and 
handler positions from each district on the Board. The two nominees for 
each position shall be elected simultaneously. The convention 
chairperson will open the floor to the nomination of candidates

[[Page 107]]

for possible election as a Board member nominee for each available 
position. Each position will be dealt with separately (i.e., candidates 
for one position will be nominated and then elected before the 
convention moves on to the next available position). Each eligible voter 
may vote for two of the nominees on one ballot. The two nominees 
receiving the greatest number of votes and at least a simple majority of 
the votes cast will be elected as the district's Board member nominees 
for the position. No individual elected as a nominee for Board 
membership may be a candidate on subsequent Board member nominee ballots 
(i.e., two different producer names and two different handler names must 
be submitted as nominees for each producer and handler position from 
each district to the Secretary of Agriculture). There shall be no 
designation of first and second choice nominees.

[54 FR 38205, Sept. 15, 1989, as amended at 58 FR 3355, Jan. 8, 1993]

                            Importer Members



Sec. 1210.404  Importer member nomination and selection.

    (a) The Board shall include one or more representatives of 
importers, who shall be appointed by the Secretary from nominations 
submitted by watermelon importers. Importers' representation on the 
Board shall be proportionate to the percentage of assessments paid by 
importers to the Board, except that at least one representative of 
importers shall serve on the Board if importers are subject to the Plan. 
Nominations for importer positions that become vacant shall be made by 
importers at nomination conventions or by mail ballot.
    (b) The initial nomination of importer members shall be made not 
later than 90 days after the Plan is amended.
    (c) There shall be two individuals nominated for each vacant 
position. The importer receiving the highest number of votes for a 
vacancy shall be the first choice nominee, and the importer receiving 
the second highest number of votes shall be the second choice nominee 
submitted to the Secretary.
    (d) Any individual, group of individuals, partnership, corporation, 
association, cooperative or any other entity which is engaged in the 
production, first handling or importing of watermelons is considered a 
person and as such is entitled to only one vote, except that such person 
may cast proxy votes as provided in paragraph (e)(1) of this section.
    (e) Nomination Conventions. If nominations are made by nomination 
conventions, the Board shall widely publicize such conventions and 
provide importers and the Secretary at least 10 days notice prior to 
each convention.
    (1) Proxy voting by importers shall be permitted at all conventions. 
Any person wanting to cast proxy votes must demonstrate authorization to 
do so. Authority to cast a proxy vote on behalf of another person shall 
be demonstrated through documentation containing:
    (i) The proxy voter's name, address, and telephone number;
    (ii) Signature and date signed;
    (iii) A certification identifying the proxy voter as an importer; 
and
    (iv) A statement identifying the person being given authority by the 
proxy voter to cast the proxy vote.
    (2) The Board shall provide to the Secretary a typed copy of each 
convention's minutes and shall arrange for completion of qualification 
statements and other specified information by each nominee and forward 
such to the Secretary within 14 calendar days of completion of a 
convention.
    (f) Mail balloting. If nominations are conducted by mail ballot, the 
Board shall request importers to submit nominations of eligible 
importers. It is the importer's responsibility to prove the individual's 
eligibility. After the names of nominees are received, the Board shall 
print ballots and ask eligible importers to vote to nominate their 
candidates. After the vote is received, the Board shall tabulate the 
results and shall send to the Department the nominees in order of 
preference. The Board shall provide the Secretary with a report on the 
results, number of importers participating in the vote, and the volume 
of imports, and shall arrange for completion of qualification

[[Page 108]]

statements and other specified information by each nominee and forward 
such to the Secretary within 14 calendar days of receiving the ballots.
    (g) Any individual who both imports and handles watermelons will be 
considered an importer if that person imports 50 percent or more of the 
combined total volume of watermelons handled and imported by that 
person.

[60 FR 10800, Feb. 28, 1995]

                              Public Member



Sec. 1210.405  Public member nominations and selection.

    (a) The public member shall be nominated by the other members of the 
Board. The public member shall have no direct financial interest in the 
commercial production or marketing of watermelons except as a consumer 
and shall not be a director, stockholder, officer or employee of any 
firm so engaged. The Board shall nominate two individuals for the public 
member position. Voting for public member nominees shall require a 
quorum of the Board and shall be on the basis of one vote per Board 
member. Election of nominees shall be on the basis of a simple majority 
of those present and voting. Such election shall be held prior to August 
1, 1990, and every third August first thereafter. The Board may 
prescribe such additional qualifications, administrative rules and 
procedures for selection and voting for public member nominees as it 
deems necessary and the Secretary approves.
    (b) Each person nominated for the position of public member on the 
Board shall qualify by filing a written acceptance with the Secretary 
within 14 calendar days of completion of the Board meeting at which 
public member nominees were selected.

[55 FR 13256, Apr. 10, 1990. Redesignated and amended at 60 FR 10800, 
Feb. 28, 1995]



                     Subpart C_Rules and Regulations

    Source: 55 FR 13256, Apr. 10, 1990, unless otherwise noted.

                               Definitions



Sec. 1210.500  Terms defined.

    Unless otherwise defined in this subpart, definitions of terms used 
in this subpart shall have the same meaning as the definitions of such 
terms which appear in subpart--Watermelon Research and Promotion Plan.

                                 General



Sec. 1210.501  Realignment of districts.

    Pursuant to Sec. 1210.320(c) of the Plan, the districts shall be as 
follows:
    District 1--The Florida counties of Brevard, Broward, Collier, Dade, 
Glades, Hardee, Hendry, Highlands, Indian River, Lee, Martin, Monroe, 
Okeechobee, Osceola, Palm Beach, Polk, and St. Lucie.
    District 2--The Florida counties of Alachula, Baker, Bay, Bradford, 
Calhoun, Charlotte, Citrus, Clay, Columbia, Desoto, Dixie, Duval, 
Escambia, Flagler, Franklin, Gadsden, Gilchrist, Gulf, Hamilton, 
Hernando, Hillsborough, Holmes, Jackson, Jefferson, Lafayette, Lake, 
Leon, Levy, Liberty, Madison, Manatee, Marion, Nassau, Okaloosa, Orange, 
Pasco, Pinnellas, Putnam, Santa Rosa, Sarasota, Seminole, St. Johns, 
Sumter, Suwannee, Taylor, Union, Volusia, Wakulla, Walton, and 
Washington.
    District 3--Alabama, Arkansas, Georgia, Louisiana, Mississippi, 
South Carolina, and Tennessee.
    District 4--Connecticut, Delaware, Illinois, Indiana, Iowa, Kansas, 
Kentucky, Massachusetts, Maryland, Maine, Michigan, Minnesota, Missouri, 
Nebraska, New Hampshire, New Jersey, New York, North Carolina, North 
Dakota, Ohio, Oklahoma, Pennsylvania, Rhode Island, South Dakota, 
Vermont, Virginia, Washington, D.C., West Virginia, and Wisconsin.
    District 5--Alaska, Colorado, Hawaii, Idaho, Montana, Nevada, 
Oregon, Utah, Washington, Wyoming, and the California counties of 
Alameda, Alpine, Amador, Butte, Calaveras, Colusa, Contra Costa, Del 
Norte, El Dorado, Fresno, Glenn, Humboldt, Inyo, Kern, Kings, Lake, 
Lassen, Madera, Marin, Mariposa, Mendocino, Merced, Modoc, Mono, 
Monterey, Napa, Nevada, Placer, Plumas, Sacramento, San Benito, San

[[Page 109]]

Francisco, San Joaquin, San Luis Obispo, San Mateo, Santa Barbara, Santa 
Clara, Santa Cruz, Shasta, Sierra, Siskiyou, Solano, Sonoma, Stanislaus, 
Sutter, Tehama, Trinity, Tulare, Toulumne, Venture, Yolo, and Yuba.
    District 6--Texas.
    District 7--Arizona, New Mexico, and the California counties of 
Imperial, Los Angeles, Orange, Riverside, San Bernardino and San Diego.

[66 FR 13402, Mar. 6, 2001]



Sec. 1210.502  [Reserved]



Sec. 1210.504  Contracts.

    The Board, with the approval of the Secretary, may enter into 
contracts or make agreements with persons for the development and 
submission to it of programs or projects authorized by the Plan and for 
carrying out such programs or projects. Contractors shall agree to 
comply with the provisions of this part. Subcontractors who enter into 
contracts or agreements with a Board contractor and who receive or 
otherwise utilize funds allocated by the Board shall be subject to the 
provisions of this part. All records of contractors and subcontractors 
applicable to contracts entered into by the Board are subject to audit 
by the Secretary.



Sec. 1210.505  Department of Agriculture costs.

    Pursuant to Sec. 1210.340, the Board shall reimburse the Department 
of Agriculture for referendum and administrative costs incurred by the 
Department with respect to the Plan. The Board shall pay those costs 
incurred by the Department for the conduct of Department duties under 
the Plan as determined periodically by the Secretary. The Department 
will bill the Board monthly and payment shall be due promptly after the 
billing of such costs. Funds to cover such expenses shall be paid from 
assessments collected pursuant to Sec. 1210.341.

[55 FR 13256, Apr. 10, 1990, as amended at 60 FR 10800 Feb. 28, 1995]

                               Assessments



Sec. 1210.515  Levy of assessments.

    (a) An assessment of two cents per hundredweight shall be levied on 
all watermelons produced for ultimate consumption as human food, and an 
assessment of two cents per hundredweight shall be levied on all 
watermelons first handled for ultimate consumption as human food. An 
assessment of four cents per hundredweight shall be levied on all 
watermelons imported into the United States for ultimate consumption as 
human food at the time of entry in the United States.
    (b) The import assessment shall be uniformly applied to imported 
watermelons that are identified by the numbers 0807.10.30007 and 
0807.10.40005 in the Harmonized Tariff Schedule of the United States or 
any other number used to identify fresh watermelons for consumption as 
human food. The U.S. Customs Service (USCS) will collect assessments on 
such watermelons at the time of entry and will forward such assessment 
as per the agreement between USCS and USDA. Any importer or agent who is 
exempt from payment of assessments may submit the Board adequate proof 
of the volume handled by such importer for the exemption to be granted.
    (c) Watermelons used for non-human food purposes are exempt from 
assessment requirements but are subject to the safeguard provisions of 
Sec. 1210.521.

[55 FR 13256, Apr. 10, 1990, as amended at 60 FR 10800, Feb. 28, 1995]



Sec. 1210.516  [Reserved]



Sec. 1210.517  Determination of handler.

    The producer and handler assessments on each lot of watermelons 
handled shall be paid by the handler. Unless otherwise provided in this 
section, the handler responsible for payment of assessments shall be the 
first handler of such watermelons. The first handler is the person who 
initially performs a handling function as heretofore defined. Such 
person may be a fresh shipper, processor, or other person who first 
places the watermelons in the current of commerce.

[[Page 110]]

    (a) The following examples are provided to aid in the identification 
of first handlers:
    (1) Producer grades, packs, and sells watermelons of own production 
to a handler. In this instance, it is the handler, not the producer, who 
places the watermelons in the current of commerce. The handler is 
responsible for payment of the assessments.
    (2) Producer packs and sells watermelons of that producer's own 
production from the field, roadside stand, or storage to a consumer, 
trucker, retail or wholesales outlet, or other buyer who is not a 
handler of watermelons. The producer places the watermelons in the 
current of commerce and is the first handler.
    (3) Producer purchases watermelons from another producer. The 
producer purchasing the watermelons is the first handler.
    (4) Producer delivers field-run watermelons of own production to a 
handler for preparation for market and entry into the current of 
commerce. The handler, in this instance, is the first handler, 
regardless of whether the handler subsequently handles such watermelons 
for the account of the handler or for the account of the producer.
    (5) Producer delivers field-run watermelons of own production to a 
handler for preparation for market and return to the producer for sale. 
The producer in this instance, is the first handler, except when the 
producer subsequently sells such watermelons to a handler.
    (6) Producer delivers watermelons of own production to a handler who 
takes title to such watermelons. The handler who purchases such 
watermelons from the producer is the first handler.
    (7) Producer supplies watermelons to a cooperative marketing 
association which sells or markets the watermelons and makes an 
accounting to the producer, or pays the proceeds of the sale to the 
producer. In this instance, the cooperative marketing association 
becomes the first handler upon physical delivery to such cooperative.
    (8) Handler purchases watermelons from a producer's field for the 
purpose of preparing such watermelons for market or for transporting 
such watermelons to storage for subsequent handling. The handler who 
purchases such watermelons from the producer is the first handler.
    (9) Broker/Commission House receives watermelons from a producer and 
sells such watermelons in the Broker's/Commission House's name. In this 
instance, the Broker/Commission House is the first handler, regardless 
of whether the Broker/ Commission House took title to such watermelons.
    (10) Broker/Commission House, without taking title or possession of 
watermelons, sells such watermelons in the name of the producer. In this 
instance, the producer is the first handler.
    (11) Processor utilizes watermelons of own production in the 
manufacture of rind pickles, frozen, dehydrated, extracted, or canned 
products for human consumption. In so handling watermelons the processor 
is the first handler.
    (12) Processor purchases watermelons from the producer thereof. In 
this instance, the processor is the first handler even though the 
producer may have graded, packed, or otherwise handled such watermelons.
    (b) In the event of a handler's death, bankruptcy, receivership, or 
incapacity to act, the representative of the handler or the handler's 
estate shall be considered the handler of the watermelons for the 
purpose of this subpart.

[55 FR 13256, Apr. 10, 1990, as amended at 58 FR 3356, Jan. 8, 1993]



Sec. 1210.518  Payment of assessments.

    (a) Time of payment. The assessment on domestically produced 
watermelons shall become due at the time the first handler handles the 
watermelons for non-exempt purposes. The assessment on imported 
watermelons shall become due at the time of entry, or withdrawal, into 
the United States.
    (b) Responsibility for payment. (1) The first handler is responsible 
for payment of both the producer's and the handler's assessment. The 
handler may collect the producer's assessment from the producer or 
deduct such producer's assessment from the proceeds paid to the producer 
on whose watermelons the producer assessment is made. Any such 
collection or deduction of producer assessment shall be made not later 
than

[[Page 111]]

the time when the first handler handles the watermelons.
    (2) The U.S. Customs Service shall collect assessments on imported 
watermelons from importers and forward such assessments under an 
agreement between the U.S. Customs Service and the U.S. Department of 
Agriculture. Importers shall be responsible for payment of assessments 
directly to the Board of any assessments due but not collected by the 
U.S. Customs Service at the time of entry, or withdrawal, on watermelons 
imported into the United States for human consumption.
    (c) Payment direct to the Board. (1) Except as provided in paragraph 
(b) and (e) of this section, each handler and importer shall remit the 
required producer and handler assessments, pursuant to Sec. 1210.341 of 
the Plan, directly to the Board not later than 30 days after the end of 
the month such assessments are due. Remittance shall be by check, draft, 
or money order payable to the National Watermelon Promotion Board, or 
NWPB, and shall be accompanied by a report, preferably on Board forms, 
pursuant to Sec. 1210.350. To avoid late payment charges, the 
assessments must be mailed to the Board and postmarked within 30 days 
after the end of the month such assessments are due.
    (2) Pursuant to Sec. 1210.350 of the Plan, each handler shall file 
with the Board a report for each month that assessable watermelons were 
handled. All handler reports shall contain at least the following 
information:
    (i) The handler's name, address, and telephone number;
    (ii) Date of report (which is also the date of payment to the 
Board);
    (iii) Period covered by the report;
    (iv) Total quantity of watermelons handled during the reporting 
period;
    (v) Date of last report remitting assessments to the Board; and
    (vi) Listing of all persons for whom the handler handled 
watermelons, their addresses, hundredweight handled, and total 
assessments remitted for each producer. In lieu of such a list, the 
handler may substitute copies of settlement sheets given to each person 
or computer generated reports, provided such settlement sheets or 
computer reports contain all the information listed above.
    (vii) Name, address, and hundredweight handled for each person 
claiming exemption for assessment.
    (viii) If the handler handled watermelons for persons engaged in the 
growing of less than 10 acres of watermelons, the report shall indicate 
the name and address of such person and the quantity of watermelons 
handled for such person.
    (3) The words ``final report'' shall be shown on the last report at 
the close of the handler's marketing season or at the end of each fiscal 
period if such handler markets assessable watermelons on a year-round 
basis.
    (4) Prepayment of assessments. (i) In lieu of the monthly assessment 
and reporting requirements of paragraph (b) of this section, the Board 
may permit handlers to make an advance payment of their total estimated 
assessments for the crop year to the Board prior to their actual 
determination of assessable watermelons. The Board shall not be 
obligated to pay interest on any advance payment.
    (ii) Handlers using such procedures shall provide a final annual 
report of actual handling and remit any unpaid assessments not later 
than 30 days after the end of the last month of the designated handler's 
marketing season or at the end of each fiscal period if such handler 
markets assessable watermelons on a year-round basis.
    (iii) Handlers using such procedures shall, after filing a final 
annual report, receive a reimbursement of any overpayment of 
assessments.
    (iv) Handlers using such procedures shall, at the request of the 
Board to verify a producer's refund claim, provide the Board with a 
handling report on any and all producers for whom the handler has 
provided handling services but has not yet filed a handling report with 
the Board.
    (v) Specific requirements, instructions, and forms for making such 
advance payments shall be provided by the Board on request.
    (d) Late payment charges and interest. (1) A late payment charge 
shall be imposed on any handler and importer who fails to make timely 
remittance to the Board of the total producer and handler and importer 
assessments for which any such handler and importer is

[[Page 112]]

liable. Such late payment shall be imposed on any assessments not 
received before the fortieth day after the end of the month such 
assessments are due. This one-time late payment charge shall be 10 
percent of the assessments due before interest charges have accrued. The 
late payment charge will not be applied to any late payments postmarked 
within 30 days after the end of the month such assessments are due.
    (2) In addition to the late payment charge, one and one-half percent 
per month interest on the outstanding balance, including the late 
payment charge and any accrued interest, will be added to any accounts 
for which payment has not been received by the last day of the second 
month following the month of handling; Provided, that, handlers paying 
their assessments in accordance with paragraph (c)(4)(ii), will not be 
subject to the one and one-half percent per month interest under this 
paragraph until the last day of the second month after such assessments 
are due under paragraph (c)(4)(ii). Such interest will continue monthly 
until the outstanding balance is paid to the Board.
    (e) Payment through cooperating agency. The Board may enter into 
agreements, subject to approval of the Secretary, authorizing other 
organizations, such as a regional watermelon association or State 
watermelon board, to collect assessments in its behalf. In any State or 
area in which the Board has entered into such an agreement, the 
designated handler shall pay the assessment to such agency in the time 
and manner, and with such identifying information as specified in such 
agreement. Such an agreement shall not provide any cooperating agency 
with authority to collect confidential information from handlers or 
producers. To qualify, the cooperating agency must on its own accord 
have access to all information required by the Board for collection 
purposes. If the Board requires further evidence of payment than 
provided by the cooperating agency, it may acquire such evidence from 
individual handlers. All such agreements are subject to the requirements 
of the Act, Plan, and all applicable rules and regulations under the Act 
and the Plan.

[55 FR 13256, Apr. 10, 1990; 55 FR 20443, May 17, 1990, as amended at 56 
FR 15808, Apr. 18, 1991; 60 FR 10801, Feb. 28, 1995]



Sec. 1210.519  Failure to report and remit.

    Any handler and importer who fails to submit reports and remittances 
according to the provisions of Sec. 1210.518 shall be subject to 
appropriate action by the Board which may include one or more of the 
following actions:
    (a) Audit of the handler's and importer's books and records to 
determine the amount owed the Board.
    (b) Establishment of an escrow account for the deposit of 
assessments collected. Frequency and schedule of deposits and 
withdrawals from the escrow account shall be determined by the Board 
with the approval of the Secretary.
    (c) Referral to the Secretary for appropriate enforcement action.

[55 FR 13256, Apr. 10, 1990, as amended at 60 FR 10801, Feb. 28, 1995]



Sec. 1210.520  Refunds.

    Each importer of less than 150,000 pounds of watermelons during any 
calendar year shall be entitled to apply for a refund of the assessments 
paid in an amount equal to the amount paid by domestic producers.
    (a) Application form. The Board shall make available to all 
importers a refund application form.
    (b) Submission of refund application to the Board. The refund 
application form shall be submitted to the Board within 90 days of the 
last day of the year the watermelons were actually imported. The refund 
application form shall contain the following information:
    (1) Importer's name and address;
    (2) Number of hundredweight of watermelon on which refund is 
requested;
    (3) Total amount to be refunded;
    (4) Proof of payment as described below; and
    (5) Importer's signature.
    (c) Proof of payment of assessment. Evidence of payment of 
assessments satisfactory to the Board shall accompany the importer's 
refund application. An importer must submit a copy of the importer's 
report or a cancelled check.

[[Page 113]]

Evidence submitted with a refund application shall not be returned to 
the applicant.
    (d) Payment of refund. Immediately after receiving the properly 
executed application for refund, the Board shall make remittance to the 
applicant.

[60 FR 10801, Feb. 28, 1995]



Sec. 1210.521  Reports of disposition of exempted watermelons.

    The Board may require reports by handlers or importers on the 
handling/importing and disposition of exempted watermelons and/or on the 
handling of watermelons for persons engaged in growing less than 10 
acres of watermelons or in the case of importers, the importing of less 
than 150,000 pounds per year. Authorized employees of the Board or the 
Secretary may inspect such books and records as are appropriate and 
necessary to verify the reports on such disposition.

[60 FR 10801, Feb. 28, 1995]

                                 Records



Sec. 1210.530  Retention period for records.

    Each handler and importer required to make reports pursuant to this 
subpart shall maintain and retain for at least 2 years beyond the 
marketing year of their applicability:
    (a) One copy of each report made to the Board; and
    (b) Such records as are necessary to verify such reports.

[55 FR 13256, Apr. 10, 1990, as amended at 60 FR 10801, Feb. 28, 1995]



Sec. 1210.531  Availability of records.

    Each handler and importer required to make reports pursuant to this 
subpart shall make available for inspection and copying by authorized 
employees of the Board or the Secretary during regular business hours, 
such records as are appropriate and necessary to verify reports required 
under this subpart.

[55 FR 13256, Apr. 10, 1990, as amended at 60 FR 10801, Feb. 28, 1995]



Sec. 1210.532  Confidential books, records, and reports.

    All information obtained from the books, records, and reports of 
handlers and importers and all information with respect to refunds of 
assessments made to importers shall be kept confidential in the manner 
and to the extent provided for in Sec. 1210.352.

[60 FR 10801, Feb. 28, 1995]

                              Miscellaneous



Sec. 1210.540  OMB assigned numbers.

    The information collection and recordkeeping requirements contained 
in this part have been approved by the Office of Management and Budget 
(OMB) under the provisions of 44 U.S.C. chapter 35 and have been 
assigned OMB Control Number 0581-0093, except that Board member nominee 
background information sheets are assigned OMB Control Number 0505-0001.

[58 FR 3356, Jan. 8, 1993]



                     Subpart D_Referendum Procedures

    Source: 66 FR 56388, Nov. 7, 2001; 67 FR 17907, Apr. 12, 2002, 
unless otherwise noted.



Sec. 1210.600  General.

    Referenda to determine whether eligible producers, handlers, and 
importers favor the continuation, suspension, termination, or amendment 
of the Watermelon Research and Promotion Plan shall be conducted in 
accordance with this subpart.



Sec. 1210.601  Definitions.

    Unless otherwise defined in this section, the definition of terms 
used in these procedures shall have the same meaning as the definitions 
in the Plan.
    (a) Administrator means the Administrator of the Agricultural 
Marketing Service, with power to redelegate, or any officer or employee 
of the Department to whom authority has been delegated or may hereafter 
be delegated to act in the Administrator's stead.
    (b) Department means the United States Department of Agriculture.
    (c) Eligible handler means any person (except a common contract 
carrier of

[[Page 114]]

watermelons owned by another person) who handles watermelons, including 
a producer who handles watermelons of the producer's own production, 
subject to the provisions of Sec. 1210.602(a) of this chapter, who 
handles watermelons as a person performing a handling function and 
either:
    (1) Takes title or possession of watermelons from a producer and 
directs the grading, packing, transporting, and selling of the 
watermelons in the current of commerce;
    (2) Purchases watermelons from producers;
    (3) Purchases watermelons from handlers;
    (4) Purchases watermelons from importers; or
    (5) Arranges the sale or transfer of watermelons from one party to 
another and takes title or possesssion of the watermelons: Provided, 
That harvest crews and common carriers who collect and transport 
watermelons from the field to a handler are not handlers and that 
retailers, wholesale retailers, foodservice distributors, and 
foodservice operators are not handlers.
    (d) Eligible importer means any person who imports 150,000 pounds or 
more watermelons annually into the United States as principal or as an 
agent, broker, or consignee for any person who produces watermelons 
outside the United States for sale in the United States. An importer who 
imports less than 150,000 pounds of watermelons annually and did not 
apply for and receive reimbursement of assessments is also an eligible 
importer.
    (e) Eligible producer means any person who is engaged in the growing 
of 10 or more acres of watermelons, including any person who owns or 
shares the ownership and risk of loss of such watermelon crop. A person 
who shares the ownership and risk of loss includes a person who:
    (1) Owns and farms land, resulting in ownership, by said producer, 
of the watermelons produced thereon;
    (2) Rents and farms land, resulting in ownership, by said producer, 
of all or a portion of the watermelons produced thereon; or
    (3) Owns land which said producer does not farm and, as rental for 
such land, obtains the ownership of a portion of the watermelons 
produced thereon. Ownership of, or leasehold interest in land, and the 
acquisition, in any manner other than set forth in this subpart, of 
legal title to the watermelons grown on said land, shall not be deemed 
to result in such owners or lessees becoming producers. Persons who 
produce watermelons for non-food uses are not producers for the purposes 
of this subpart.
    (f) Person means any individual, group of individuals, partnership, 
corporation, association, cooperative, or any other entity. For the 
purpose of this definition, the term partnership includes, but is not 
limited to:
    (1) A husband and wife who have title to, or leasehold interest in, 
land as tenants in common, joint tenants, tenants by the entirety, or, 
under community property laws, as community property, and
    (2) So-called joint ventures wherein one or more parties to the 
agreement, informal or otherwise, contributed land and others 
contributed capital, labor, management, equipment, or other services, or 
any variation of such contributions by two or more parties, so that it 
results in the production, handling, or importation of watermelons for 
market and the authority to transfer title to the watermelons so 
produced, handled, or imported.
    (g) Referendum agent or agent means the individual or individuals 
designated by the Secretary to conduct the referendum.
    (h) Representative period means the period designated by the 
Secretary pursuant to the Act.



Sec. 1210.602  Voting.

    (a) Each person who is an eligible producer, handler, or importer as 
defined in this subpart, at the time of the referendum and who also was 
a producer, handler, or importer during the representative period, shall 
be entitled to one vote in the referendum: Provided, That each producer 
in a landlord-tenant relationship or a divided ownership arrangement 
involving totally independent entities cooperating only to produce 
watermelons in which more than one of the parties is a producer, shall 
be entitled to one vote in

[[Page 115]]

the referendum covering only that producer's share of the ownership: 
Provided further, That the vote of a person who both produces and 
handles watermelons will be counted as a handler vote if the producer 
purchased watermelons from other producers, in a combined total volume 
that is equal to 25 percent or more of the producer's own production; or 
the combined total volume of watermelon handled by the producer from the 
producer's own production and purchased from other producer's production 
is more than 50 percent of the producer's own production: Provided 
further, That the vote of a person who both imports and handles 
watermelons will be counted as an importer vote if that person imports 
50 percent or more of the combined total volume of watermelons handled 
and imported by that person.
    (b) Proxy voting is not authorized, but an officer or employee of a 
corporate producer, handler, or importer, or an administrator, executor, 
or trustee of a producing, handling, or importing entity may cast a 
ballot on behalf of such entity. Any individual so voting in a 
referendum shall certify that the individual is an officer, employee of 
the producer, handler, or importer, or an administrator, executor, or 
trustee of a producing, handling, or importing entity and that the 
individual has the authority to take such action. Upon request of the 
referendum agent, the individual shall submit adequate evidence of such 
authority.
    (c) Casting of ballots. All ballots are to be cast as instructed by 
the Secretary.



Sec. 1210.603  Instructions.

    The referendum agent shall conduct the referendum, in the manner 
provided in this section, under the supervision of the Administrator. 
The Administrator may prescribe additional instructions, not 
inconsistent with the provisions in this section, to govern the 
procedure to be followed by the referendum agent. Such agent shall:
    (a) Determine the period during which ballots may be cast.
    (b) Provide ballots and related material to be used in the 
referendum. The ballot shall provide for recording essential 
information, including that needed for ascertaining whether the person 
voting, or on whose behalf the vote is cast, is an eligible voter.
    (c) Give reasonable public notice of the referendum:
    (1) By utilizing available media or public information sources, 
without incurring advertising expense, to publicize the voting period, 
method of voting, eligibility requirements, and other pertinent 
information. Such sources of publicity may include, but are not limited 
to, print and radio; and
    (2) By such other means as said agent may deem advisable.
    (d) Mail to eligible producers; importers; and in the case of an 
order assessing handlers, handlers whose names and addresses are known 
to the referendum agent; the instructions on voting; a ballot; and a 
summary of the terms and conditions to be voted upon. No person who 
claims to be eligible to vote shall be refused a ballot. However, such 
persons may be required to submit evidence of their eligibility.
    (e) At the end of the voting period, collect, open, number, and 
review the ballots and tabulate the results in the presence of an agent 
of a third party authorized to monitor the referendum process.
    (f) Prepare a report on the referendum.
    (g) Announce the results to the public.



Sec. 1210.604  Subagents.

    The referendum agent may appoint any individual or individuals 
necessary to assist the agent in performing such agent's functions 
hereunder. Each individual so appointed may be authorized by the agent 
to perform any or all of the functions which, in the absence of such 
appointment, shall be performed by the agent.



Sec. 1210.605  Ballots.

    The referendum agent and subagents shall accept all ballots cast. 
However, if an agent or subagent deems that a ballot should be 
questioned for any reason, the agent or subagent shall endorse above 
their signature, on the ballot, a statement to the effect that such 
ballot was questioned, by whom questioned, why the ballot was 
questioned, the results of any investigation made

[[Page 116]]

with respect to the questionable ballot, and the disposition of the 
questionable ballot. Ballots invalid under this subpart shall not be 
counted.



Sec. 1210.606  Referendum report.

    Except as otherwise directed, the referendum agent shall prepare and 
submit to the Administrator a report on the results of the referendum, 
the manner in which it was conducted, the extent and kind of public 
notice given, and other information pertinent to analysis of the 
referendum and its results.



Sec. 1210.607  Confidential information.

    All ballots cast and their contents and all other information or 
reports furnished to, compiled by, or in possession of, the referendum 
agent or subagents that reveal, or tend to reveal, the identity or vote 
of any producer, handler, or importer of watermelons shall be held 
strictly confidential and shall not be disclosed.



PART 1214_KIWIFRUIT RESEARCH, PROMOTION, AND CONSUMER INFORMATION ORDER
--Table of Contents




Subparts A-B [Reserved]

Subpart C_Procedure for the Conduct of Referenda in Connection With the 
      Kiwifruit Research, Promotion, and Consumer Information Order

Sec.
1214.200 General.
1214.201 Definitions.
1214.202 Voting.
1214.203 Instructions.
1214.204 Subagents.
1214.205 Ballots.
1214.206 Referendum report.
1214.207 Confidential information.

    Authority: 7 U.S.C. 7461-7473.

    Source: 62 FR 54312, Oct. 17, 1997, unless otherwise noted.

Subparts A-B [Reserved]



Subpart C_Procedure for the Conduct of Referenda in Connection With the 
      Kiwifruit Research, Promotion, and Consumer Information Order



Sec. 1214.200  General.

    A referendum to determine whether eligible producers and importers 
favor the issuance of a proposed Kiwifruit Research, Promotion, and 
Consumer Information Order shall be conducted in accordance with this 
subpart.



Sec. 1214.201  Definitions.

    Unless otherwise defined in this section, the definition of terms 
used in this subpart shall have the same meaning as the definitions in 
the Order.
    (a) Administrator means the Administrator of the Agricultural 
Marketing Service, with power to redelegate, or any officer or employee 
of the Department to whom authority has been delegated or may hereafter 
be delegated to act in the Administrator's stead.
    (b) Order means the Kiwifruit Research, Promotion, and Consumer 
Information Order.
    (c) Referendum agent or agent means the individual or individuals 
designated by the Secretary to conduct the referendum.
    (d) Representative period means the period designated by the 
Secretary.
    (e) Person means any individual, group of individuals, partnership, 
corporation, association, cooperative, or any other legal entity. For 
the purpose of this definition, the term ``partnership'' includes, but 
is not limited to:
    (1) A husband and wife who has title to, or leasehold interest in, 
kiwifruit production facilities and equipment as tenants in common, 
joint tenants, tenants by the entirety, or, under community property 
laws, as community property, and
    (2) So-called ``joint ventures,'' wherein one or more parties to the 
agreement, informal or otherwise, contributed capital and others 
contributed labor, management, equipment, or other services, or any 
variation of such contributions by two or more parties so that it 
results in the production or

[[Page 117]]

importation of kiwifruit and the authority to transfer title to the 
kiwifruit so produced or imported.
    (f) Eligible producer means any person or entity defined as a 
producer who produced 500 pounds or more of kiwifruit during the 
representative period and who:
    (1) Owns or shares in the ownership of kiwifruit production 
facilities and equipment resulting in the ownership of the kiwifruit 
produced;
    (2) Rents kiwifruit production facilities and equipment resulting in 
the ownership of all or a portion of the kiwifruit produced;
    (3) Owns kiwifruit production facilities and equipment but does not 
manage them and, as compensation, obtains the ownership of a portion of 
the kiwifruit produced; or
    (4) Is a party in a landlord-tenant relationship or a divided 
ownership arrangement involving totally independent entities cooperating 
only to produce kiwifruit who share the risk of loss and receive a share 
of the kiwifruit produced. No other acquisition of legal title to 
kiwifruit shall be deemed to result in persons becoming eligible 
producers.
    (g) Eligible importer means any person or entity defined as an 
importer who imported 10,000 pounds or more during the representative 
period. Importation occurs when commodities originating outside the 
United States are entered or withdrawn from the U.S. Customs Service for 
consumption in the United States. Included are persons who hold title to 
foreign-produced kiwifruit immediately upon release by the U.S. Customs 
Service, as well as any persons who act on behalf of others, as agents 
or broker, to secure the release of kiwifruit from the U.S. Customs 
Service when such kiwifruit are entered or withdrawn for consumption in 
the United States.
    (h) Kiwifruit means all varieties of fresh kiwifruit classified 
under the species Actinidia deliciosa or the genus Actinidia, whose 
fruit is a large berry, oval in shape, with a brown skin covered in 
hairs, which are grown in or imported into the United States.



Sec. 1214.202  Voting.

    (a) Each person who is an eligible producer or importer, as defined 
in this subpart, at the time of the referendum and during the 
representative period, shall be entitled to cast only one ballot in the 
referendum. However, each producer in a landlord-tenant relationship or 
a divided ownership arrangement involving totally independent entities 
cooperating only to produce kiwifruit, in which more than one of the 
parties is a producer, shall be entitled to cast one ballot in the 
referendum covering only such producer's share of the ownership.
    (b) Proxy voting is not authorized, but an officer or employee of an 
eligible corporate producer or importer, or an administrator, executor, 
or trustee of an eligible producing or importing entity may cast a 
ballot on behalf of such producer or importer entity. Any individual so 
voting in a referendum shall certify that such individual is an officer 
or employee of the eligible producer or importer, or an administrator, 
executor, or trustee of an eligible producing or importing entity, and 
that such individual has the authority to take such action. Upon request 
of the referendum agent, the individual shall submit adequate evidence 
of such authority.
    (c) All ballots are to be cast by mail.



Sec. 1214.203  Instructions.

    The referendum agent shall conduct the referendum, in the manner 
provided in this subpart, under the supervision of the Administrator. 
The Administrator may prescribe additional instructions, not 
inconsistent with the provisions of this section, to govern the 
procedure to be followed by the referendum agent. Such agent shall:
    (a) Determine the time of commencement and termination of the period 
during which ballots may be cast.
    (b) Provide ballots and related material to be used in the 
referendum. Ballot material shall provide for recording essential 
information including that needed for ascertaining:
    (1) Whether the person voting, or on whose behalf the vote is cast, 
is an eligible voter;

[[Page 118]]

    (2) The total volume of kiwifruit produced by the voting producer 
during the representative period; and
    (3) The total volume of kiwifruit imported by the voting importer 
during the representative period.
    (c) Give reasonable advance public notice of the referendum:
    (1) By utilizing available media or public information sources, 
without incurring advertising expense, to publicize the dates, places, 
method of voting, eligibility requirements, and other pertinent 
information. Such sources of publicity may include, but are not limited 
to, print and radio; and
    (2) By such other means as the agent may deem advisable.
    (d) Mail to eligible producers and importers, whose names and 
addresses are known to the referendum agent, the instructions on voting, 
a ballot, and a summary of the terms and conditions of the proposed 
Order. No person who claims to be eligible to vote shall be refused a 
ballot.
    (e) At the end of the voting period, collect, open, number, and 
review the ballots and tabulate the results in presence of an agent of 
the Office of Inspector General.
    (f) Prepare a report on the referendum.
    (g) Announce the results to the public.



Sec. 1214.204  Subagents.

    The referendum agent may appoint any individual or individuals 
deemed necessary or desirable to assist the agent in performing such 
agent's functions in this subpart. Each individual so appointed may be 
authorized by the agent to perform any or all of the functions which, in 
the absence of such appointment, shall be performed by the agent.



Sec. 1214.205  Ballots.

    The referendum agent and subagents shall accept all ballots cast; 
but, should they, or any of them, deem that a ballot should be 
challenged for any reason, the agent or subagent shall endorse above 
their signature, on the ballot, a statement to the effect that such 
ballot was challenged, by whom challenged, the reasons therefore, the 
results of any investigations made with respect thereto, and the 
disposition thereof. Ballots invalid under this subpart shall not be 
counted.



Sec. 1214.206  Referendum report.

    Except as otherwise directed, the referendum agent shall prepare and 
submit to the Administrator a report on results of the referendum, the 
manner in which it was conducted, the extent and kind of public notice 
given, and other information pertinent to analysis of the referendum and 
its results.



Sec. 1214.207  Confidential information.

    The ballots and other information or reports that reveal, or tend to 
reveal, the vote of any person covered under the Act and the voting list 
shall be held confidential and shall not be disclosed.



PART 1215_POPCORN PROMOTION, RESEARCH, AND CONSUMER INFORMATION
--Table of Contents




  Subpart A_Popcorn Promotion, Research, and Consumer Information Order

                               Definitions

Sec.
1215.1 Act.
1215.2 Board.
1215.3 Board member.
1215.4 Commerce.
1215.5 Consumer information.
1215.6 Department.
1215.7 Fiscal year.
1215.8 Industry information.
1215.9 Marketing.
1215.10 Part and subpart.
1215.11 Person.
1215.12 Popcorn.
1215.13 Process.
1215.14 Processor.
1215.15 Programs, plans, and projects.
1215.16 Promotion.
1215.17 Research.
1215.18 Secretary.
1215.19 State.
1215.20 United States.

                              Popcorn Board

1215.21 Establishment and membership.
1215.22 Nominations and appointment.
1215.23 Acceptance.
1215.24 Term of office.
1215.25 Vacancies.
1215.26 Removal.
1215.27 Procedure.
1215.28 Compensation and reimbursement.
1215.29 Powers.

[[Page 119]]

1215.30 Duties.

   Promotion, Research, Consumer Information, and Industry Information

1215.40 Programs, plans, and projects.
1215.41 Contracts.

                        Expenses and Assessments

1215.50 Budget and expenses.
1215.51 Assessments.
1215.52 Exemption from assessment.
1215.53 Influencing governmental action.

                       Reports, Books, and Records

1215.60 Reports.
1215.61 Books and records.
1215.62 Confidential treatment.

                              Miscellaneous

1215.70 Right of the Secretary.
1215.71 Suspension or termination.
1215.72 Proceedings after termination.
1215.73 Effect of termination or amendment.
1215.74 Personal liability.
1215.75 Patents, copyrights, inventions, publications, and product 
          formulations.
1215.76 Amendments.
1215.77 Separability.

                     Subpart B_Rules and Regulations

                               Definitions

1215.100 Terms defined.

                          Exemption Procedures

1215.300 Exemption procedures.

                              Miscellaneous

1215.400 OMB control numbers.

    Authority: 7 U.S.C. 7481-7491.

    Source: 62 FR 39389, July 22, 1997, unless otherwise noted.



  Subpart A_Popcorn Promotion, Research, and Consumer Information Order

                               Definitions



Sec. 1215.1  Act.

    Act means the Popcorn Promotion, Research, and Consumer Information 
Act of 1995, Subtitle E of Title V of the Federal Agriculture 
Improvement and Reform Act of 1996, Pub. L. 104-127, 7 U.S.C. 7481-7491, 
and any amendments thereto.



Sec. 1215.2  Board.

    Board means the Popcorn Board established under section 575(b) of 
the Act.



Sec. 1215.3  Board member.

    Board member means an officer or employee of a processor appointed 
by the Secretary to serve on the Popcorn Board as a representative of 
that processor.



Sec. 1215.4  Commerce.

    Commerce means interstate, foreign, or intrastate commerce.



Sec. 1215.5  Consumer information.

    Consumer information means information and programs that will assist 
consumers and other persons in making evaluations and decisions 
regarding the purchasing, preparing, and use of popcorn.



Sec. 1215.6  Department.

    Department means the United States Department of Agriculture.



Sec. 1215.7  Fiscal year.

    Fiscal year means the 12-month period from January 1 through 
December 31 each year, or such other period as recommended by the Board 
and approved by the Secretary.



Sec. 1215.8  Industry information.

    Industry information means information and programs that will lead 
to the development of new markets, new marketing strategies, or 
increased efficiency for the popcorn industry, or activities to enhance 
the image of the popcorn industry.



Sec. 1215.9  Marketing.

    Marketing means the sale or other disposition of unpopped popcorn 
for human consumption in a channel of commerce but shall not include 
sales or disposition to or between processors.



Sec. 1215.10  Part and subpart.

    Part means the Popcorn Promotion, Research, and Consumer Information 
Order and all rules and regulations and supplemental orders issued 
thereunder,

[[Page 120]]

and the term subpart means the Popcorn Promotion, Research, and Consumer 
Information Order.



Sec. 1215.11  Person.

    Person means any individual, group of individuals, partnership, 
corporation, association, cooperative, or any other legal entity.



Sec. 1215.12  Popcorn.

    Popcorn means unpopped popcorn (Zea Mays L) that is commercially 
grown, processed in the United States by shelling, cleaning, or drying, 
and introduced into a channel of commerce.



Sec. 1215.13  Process.

    Process means to shell, clean, dry, and prepare popcorn for the 
market, but does not include packaging popcorn for the market without 
also engaging in another activity described in this paragraph.



Sec. 1215.14  Processor.

    Processor means a person engaged in the preparation of unpopped 
popcorn for the market who owns or who shares the ownership and risk of 
loss of such popcorn and who processes and distributes over 4 million 
pounds of popcorn in the market per year.



Sec. 1215.15  Programs, plans, and projects.

    Programs, plans, and projects means promotion, research, consumer 
information, and industry information plans, studies, projects, or 
programs conducted pursuant to this part.



Sec. 1215.16  Promotion.

    Promotion means any action, including paid advertising, to enhance 
the image or desirability of popcorn.



Sec. 1215.17  Research.

    Research means any type of study to advance the image, desirability, 
marketability, production, product development, quality, or nutritional 
value of popcorn.



Sec. 1215.18  Secretary.

    Secretary means the Secretary of Agriculture of the United States or 
any officer or employee of the Department to whom authority has 
heretofore been delegated, or to whom authority may hereafter be 
delegated, to act in the Secretary's stead.



Sec. 1215.19  State.

    State means each of the 50 States and the District of Columbia.



Sec. 1215.20  United States.

    United States means all of the States.

                              Popcorn Board



Sec. 1215.21  Establishment and membership.

    (a) There is hereby established a Popcorn Board of nine members. The 
number of members on the Board may be changed by regulation: Provided, 
That the Board consist of not fewer than four members and not more than 
nine members. The Board shall be composed of popcorn processors 
appointed by the Secretary under Sec. 1215.24.
    (b) For purposes of nominating and appointing processors to the 
Board, the Secretary shall, to the extent practicable, take into account 
the geographic distribution of popcorn production.
    (c) No more than one officer or employee of a processor may serve as 
a Board member at the same time.



Sec. 1215.22  Nominations and appointment.

    (a) All nominations for appointments to the Board established under 
Sec. 1215.21 shall be made as follows:
    (1) As soon as practicable after the effective date of this subpart, 
nominations for appointment to the initial Board shall be obtained from 
processors by the Secretary. In any subsequent year in which an 
appointment to the Board is to be made, nominations for positions for 
which the term will expire at the end of that year shall be obtained 
from processors at least six months prior to the expiration of terms.
    (2) Except for initial Board members, whose nomination process will 
be initiated by the Secretary, the Board shall issue a call for 
nominations in each year for which an appointment to the

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Board is to be made. The call shall include, at a minimum, the following 
information:
    (i) A list of the vacancies for which nominees may be submitted and 
qualifications for nomination; and
    (ii) The date by which the names of nominees shall be submitted to 
the Secretary for consideration to be in compliance with paragraph (a) 
of this section.
    (3)(i) Nominations for each position shall be made by processors. 
Notice shall be publicized to all processors.
    (ii) All processors may participate in submitting nominations.
    (4) Two nominees must be submitted for each vacancy. If processors 
fail to nominate a sufficient number of nominees, additional nominees 
shall be obtained in a manner prescribed by the Secretary.
    (b) The Secretary shall appoint the members of the Board from 
nominations made in accordance with paragraph (a).
    (1) The Secretary may reject any nominee submitted. If there is an 
insufficient number of nominees from whom to appoint members to the 
Board as a result of the Secretary's rejecting such nominees, additional 
nominees shall be submitted to the Secretary in a manner prescribed by 
the Secretary.
    (2) Whenever processors cannot agree on nominees for a position on 
the Board under the preceding provisions of this section, or whenever 
they fail to nominate individuals for appointment to the Board, the 
Secretary may appoint members in such a manner as the Secretary 
determines appropriate.
    (3) If a processor nominates more than one officer or employee, only 
one may be appointed to the Board by the Secretary.



Sec. 1215.23  Acceptance.

    Each individual nominated for membership of the Board shall qualify 
by filing a written acceptance with the Secretary at the time of 
nomination.



Sec. 1215.24  Term of office.

    (a) The members of the Board shall serve for terms of three years, 
except that members appointed to the initial Board shall serve, to the 
extent practicable, proportionately for terms of two, three, and four 
years.
    (b)(1) Except with respect to terms of office of the initial Board, 
the term of office for each Board member shall begin on the date the 
member is seated at the Board's annual meeting or such other date that 
may be approved by the Secretary.
    (2) The term of office for the initial Board member shall begin 
immediately following the appointment by the Secretary.
    (c) Board members shall serve during the term of office for which 
they are appointed and have qualified, and until their successors are 
appointed and have qualified.
    (d) No Board member may serve more than two consecutive three-year 
terms, except as provided in Sec. 1215.25(d). Initial members serving 
two- or four-year terms may serve one successive three-year term.



Sec. 1215.25  Vacancies.

    (a) To fill any vacancy occasioned by the death, removal, 
resignation, or disqualification of any member of the Board, the 
Secretary may appoint a successor from the most recent nominations 
submitted for positions on the Board or the Secretary may obtain 
nominees to fill such vacancy in such a manner as the Secretary deems 
appropriate.
    (b) Each such successor appointment shall be for the remainder of 
the term vacated.
    (c) A vacancy will not be required to be filled if the unexpired 
term is less than six months.
    (d) If an unexpired term is less than 1.5 years, serving the term 
shall not prevent the appointee from serving two successive three-year 
terms.
    (e) A Board member shall be disqualified from serving on the Board 
if such individual ceases to be affiliated with the processor the member 
represents.



Sec. 1215.26  Removal.

    If a member of the Board consistently refuses to perform the duties 
of a member of the Board, or if a member of the Board is known to be 
engaged in acts of dishonesty or willful misconduct, the Board may 
recommend to

[[Page 122]]

the Secretary that the member be removed from office. Further, without 
recommendation of the Board, a member may be removed by the Secretary 
upon showing of adequate cause, including the failure by a member to 
submit reports or remit assessments required under this part, if the 
Secretary determines that such member's continued service will be 
detrimental to the achievement of the purposes of the Act.



Sec. 1215.27  Procedure.

    (a) At a properly convened meeting of the Board, a majority of the 
members shall constitute a quorum.
    (b) Each member of the Board will be entitled to one vote on any 
matter put to the Board, and the motion will carry if supported by a 
simple majority of those voting. At assembled meetings of the Board, all 
votes will be cast in person.
    (c) In lieu of voting at a properly convened meeting and, when in 
the opinion of the chairperson of the Board such action is considered 
necessary, the Board may take action upon the concurring votes by a 
majority of its members by mail, telephone, facsimile, or any other 
means of communication. If appropriate, any such action shall be 
confirmed promptly in writing. In that event, all members must be given 
prior notice and provided the opportunity to vote. Any action so taken 
shall have the same force and effect as though such action had been 
taken at a properly convened meeting of the Board. All votes shall be 
recorded in Board minutes.
    (d) Meetings of the Board may be conducted by electronic 
communications, provided that each member is given prior notice of the 
meeting and has the opportunity to be present either physically or by 
electronic connection.
    (e) The organization of the Board and the procedures for conducting 
meetings of the Board shall be in accordance with its bylaws, which 
shall be established by the Board and approved by the Secretary.



Sec. 1215.28  Compensation and reimbursement.

    The members of the Board shall serve without compensation but shall 
be reimbursed for necessary and reasonable expenses incurred by such 
members in the performance of their responsibilities under this subpart.



Sec. 1215.29  Powers.

    The Board shall have the following powers:
    (a) To administer the Order in accordance with its terms and 
provisions;
    (b) To make rules and regulations to effectuate the terms and 
provisions of the Order;
    (c) To select committees and subcommittees of Board members, 
including an executive committee, and to adopt such bylaws and other 
rules for the conduct of its business as it may deem advisable;
    (d) To appoint or employ such individuals as it may deem necessary, 
define the duties, and determine the compensation of such individuals;
    (e) To disseminate information to processors or industry 
organizations through programs or by direct contact using the public 
postal system or other systems;
    (f) To propose, receive, evaluate and approve budgets, plans and 
projects of popcorn promotion, research, consumer information and 
industry information, as well as to contract with the approval of the 
Secretary with appropriate persons to implement plans and projects;
    (g) To receive, investigate, and report to the Secretary for action 
any complaints of violations of the Order;
    (h) To recommend to the Secretary amendments to the order;
    (i) To accept or receive voluntary contributions;
    (j) To invest, pending disbursement pursuant to a program, plan or 
project, funds collected through assessments authorized under this Act 
provided for in Sec. 1215.51, and any other funds received by the Board 
in, and only in, obligations of the United States or any agency thereof, 
in general obligations of any State or any political subdivision 
thereof, in any interest bearing account or certificate of deposit or a 
bank that is a member of the Federal Reserve System, or in obligations 
fully guaranteed as to principal and interest by the United States;

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    (k) With the approval of the Secretary, to enter into contracts or 
agreements with national, regional, or State popcorn processor 
organizations, or other organizations or entities, for the development 
and conduct of programs, plans or projects authorized under Sec. 
1215.40 and for the payment of the cost of such programs with 
assessments received pursuant to this subpart; and
    (l) Such other powers as may be approved by the Secretary.



Sec. 1215.30  Duties.

    The Board shall have the following duties:
    (a) To meet not less than annually, and to organize and select from 
among its members a chairperson and such other officers as may be 
necessary;
    (b) To evaluate or develop, and submit to the Secretary for 
approval, promotion, research, consumer information, and industry 
information programs, plans or projects;
    (c) To prepare for each fiscal year, and submit to the Secretary for 
approval at least 60 days prior to the beginning of each fiscal year, a 
budget of its anticipated expenses and disbursements in the 
administration of this subpart, as provided in Sec. 1215.50;
    (d) To maintain such books and records, which shall be available to 
the Secretary for inspection and audit, and to prepare and submit such 
reports from time to time to the Secretary, as the Secretary may 
prescribe, and to make appropriate accounting with respect to the 
receipt and disbursement of all funds entrusted to it;
    (e) To prepare and make public, at least annually, a report of its 
activities carried out, and an accounting for funds received and 
expended;
    (f) To cause its financial statements to be prepared in conformity 
with generally accepted accounting principles and to be audited by an 
independent certified public accountant in accordance with generally 
accepted auditing standards at least once each fiscal year and at such 
other times as the Secretary may request, and submit a copy of each such 
audit to the Secretary;
    (g) To give the Secretary the same notice of meetings of the Board 
as is given to members in order that the Secretary, or a representative 
of the Secretary, may attend such meetings;
    (h) To submit to the Secretary such information as may be requested 
pursuant to this subpart;
    (i) To keep minutes, books and records that clearly reflect all the 
acts and transactions of the Board. Minutes of each Board meeting shall 
be promptly reported to the Secretary;
    (j) To act as intermediary between the Secretary and any processor;
    (k) To investigate violations of the Act, order, and regulations 
issued under the order, conduct audits, and report the results of such 
investigations and audits to the Secretary for appropriate action to 
enforce the provisions of the Act, order, and regulations; and
    (l) To work to achieve an effective, continuous, and coordinated 
program of promotion, research, consumer information, and industry 
information designed to strengthen the popcorn industry's position in 
the marketplace, maintain and expand existing markets and uses for 
popcorn, develop new markets and uses for popcorn, and to carry out 
programs, plans, and projects designed to provide maximum benefits to 
the popcorn industry.

   Promotion, Research, Consumer Information, and Industry Information



Sec. 1215.40  Programs, plans, and projects.

    (a) The Board shall receive and evaluate, or on its own initiative 
develop, and submit to the Secretary for approval any program, plan or 
project authorized under this subpart. Such programs, plans or projects 
shall provide for:
    (1) The establishment, issuance, effectuation, and administration of 
appropriate programs for promotion, research, consumer information, and 
industry information with respect to popcorn; and
    (2) The establishment and conduct of research with respect to the 
sale, distribution, marketing, and use of popcorn, and the creation of 
new uses thereof, to the end that the marketing and use of popcorn may 
be encouraged,

[[Page 124]]

expanded, improved, or made more acceptable.
    (b) No program, plan, or project shall be implemented prior to its 
approval by the Secretary. Once a program, plan, or project is so 
approved, the Board may take appropriate steps to implement it.
    (c) Each program, plan, or project implemented under this subpart 
shall be reviewed or evaluated periodically by the Board to ensure that 
it contributes to an effective program of promotion, research, consumer 
information, or industry information. If it is found by the Board that 
any such program, plan, or project does not contribute to an effective 
program of promotion, research, consumer information, or industry 
information, then the Board shall terminate such program, plan, or 
project.
    (d) In carrying out any program, plan, or project, no reference to a 
brand name, trade name, or State or regional identification of any 
popcorn will be made. In addition, no program, plan, or project shall 
make use of unfair or deceptive acts or practices with respect to the 
quality, value, or use of any competing product.



Sec. 1215.41  Contracts.

    The Board shall not contract with any processor for the purpose of 
promotion or research. The Board may lease physical facilities from a 
processor for such promotion or research, if such an arrangement is 
determined to be cost effective by the Board and approved by the 
Secretary. Any contract or agreement shall provide that:
    (a) The contractor or agreeing party shall develop and submit to the 
Board a program, plan or project together with a budget or budgets that 
shall show the estimated cost to be incurred for such program, plan, or 
project;
    (b) Any such program, plan, or project shall become effective upon 
approval by the Secretary;
    (c) The contracting or agreeing party shall keep accurate records of 
all of its transactions and make periodic reports to the Board of 
activities conducted, submit accountings for funds received and 
expended, and make such other reports as the Secretary or the Board may 
require; and the Secretary may audit the records of the contracting or 
agreeing party periodically; and
    (d) Any subcontractor who enters into a contract with a Board 
contractor and who receives or otherwise uses funds allocated by the 
Board shall be subject to the same provisions as the contractor.

                        Expenses and Assessments



Sec. 1215.50  Budget and expenses.

    (a) At least 60 days prior to the beginning of each fiscal year, and 
as may be necessary thereafter, the Board shall prepare and submit to 
the Secretary a budget for the fiscal year covering its anticipated 
expenses and disbursements in administering this subpart.
    (b) Each budget shall include:
    (1) A rate of assessment for such fiscal year calculated, subject to 
Sec. 1215.51(b), to provide adequate funds to defray its proposed 
expenditures and to provide for a reserve as set forth in paragraph (g) 
of this section;
    (2) A statement of the objectives and strategy for each program, 
plan, or project;
    (3) A summary of anticipated revenue, with comparative data for at 
least one preceding year;
    (4) A summary of proposed expenditures for each program, plan, or 
project; and
    (5) Staff and administrative expense breakdowns, with comparative 
data for at least one preceding year.
    (c) In budgeting plans and projects of promotion, research, consumer 
information, and industry information, the Board shall expend assessment 
and contribution funds on:
    (1) Plans and projects for popcorn marketed in the United States or 
Canada in proportion to the amount of assessments projected to be 
collected on domestically marketed popcorn (including Canada); and
    (2) Plans and projects for exported popcorn in proportion to the 
amount of assessments projected to be collected on exported popcorn 
(excluding Canada).
    (d) The Board is authorized to incur such reasonable expenses, 
including provision for a reasonable reserve, as the Secretary finds are 
reasonable and

[[Page 125]]

likely to be incurred by the Board for its maintenance and functioning, 
and to enable it to exercise its powers and perform its duties in 
accordance with the provisions of this subpart. Such expenses shall be 
paid from funds received by the Board.
    (e) The Board may accept voluntary contributions, but these shall 
only be used to pay expenses incurred in the conduct of programs, plans, 
and projects approved by the Secretary. Such contributions shall be free 
from any encumbrances by the donor and the Board shall retain complete 
control of their use. The Board may also receive funds provided through 
the Foreign Agricultural Service of the United States Department of 
Agriculture for foreign marketing activities.
    (f) As stated in section 75(f)(4)(A)(ii) of the Act, the Board shall 
reimburse the Secretary, from funds received by the Board, for costs 
incurred by the Secretary in implementing and administering this 
subpart: Provided, That the costs incurred by the Secretary to be 
reimbursed by the Board, excluding legal costs to defend and enforce the 
order, shall not exceed 15 percent of the projected annual revenues of 
the Board.
    (g) The Board may establish an operating monetary reserve and may 
carry over to subsequent fiscal periods excess funds in any reserve so 
established, except that the funds in this reserve shall not exceed 
approximately one fiscal year's expenses. Such reserve funds may be used 
to defray any expenses authorized under this subpart.
    (h) With the approval of the Secretary, the Board may borrow money 
for the payment of administrative expenses, subject to the same fiscal, 
budget, and audit controls as other funds of the Board during its first 
year of operation only.



Sec. 1215.51  Assessments.

    (a) Any processor marketing popcorn in the United States or for 
export shall pay an assessment on such popcorn at the time of 
introduction to market at a rate as established in Sec. 1215.51(c) and 
shall remit such assessment to the Board in such form and manner as 
prescribed by the Board.
    (b) Any person marketing popcorn of that person's own production to 
consumers in the United States either directly or through retail or 
wholesale outlets, shall remit to the Board an assessment on such 
popcorn at the rate set forth in paragraph Sec. 1215.51(c), and in such 
form and manner as prescribed by the Board.
    (c) Except as otherwise provided, the rate of assessment shall be 5 
cents per hundredweight of popcorn. The rate of assessment may be raised 
or lowered as recommended by the Board and approved by the Secretary, 
but shall not exceed 8 cents per hundredweight in any fiscal year.
    (d) The collection of assessments under this section shall commence 
on all popcorn processed in the United States on or after the date 
established by the Secretary, and shall continue until terminated by the 
Secretary. If the Board is not constituted on the date the first 
assessments are to be collected, the Secretary shall have the authority 
to receive assessments on behalf of the Board and may hold such 
assessments until the Board is constituted, then remit such assessments 
to the Board.
    (e) Each person responsible for remitting assessments under 
paragraphs (a) and (b) of this section shall remit the amounts due from 
assessments to the Board on a quarterly basis no later than the last day 
of the month following the last month in the previous quarter in which 
the popcorn was marketed, in such manner as prescribed by the Board.
    (f) The Board shall impose a late payment charge on any person who 
fails to remit to the Board the total amount for which the person is 
liable on or before the payment due date established under this section. 
The amount of the late payment charge shall be prescribed in rules and 
regulations as approved by the Secretary.
    (g) The Board shall impose an additional charge on any person 
subject to a late payment charge, in the form of interest on the 
outstanding portion of any amount for which the person is liable. The 
rate of interest shall be prescribed in rules and regulations as 
approved by the Secretary.

[[Page 126]]

    (h) In addition, persons failing to remit total assessments due in a 
timely manner may also be subject to penalties and actions under federal 
debt collection procedures as set forth in 7 CFR 3.1 through 3.36.
    (i) Any assessment that is determined to be owing at a date later 
than the payment due established under this section, due to a person's 
failure to submit a report to the Board by the payment due date, shall 
be considered to have been payable on the payment due date. Under such a 
situation, paragraphs (f), (g), and (h) of this section shall be 
applicable.
    (j) The Board, with the approval of the Secretary, may enter into 
agreements authorizing other organizations or entities to collect 
assessments on its behalf. Any such organization or entity shall be 
required to maintain the confidentiality of such information as is 
required by the Board for collection purposes. Any reimbursement by the 
Board for such services shall be based on reasonable charges for 
services rendered.
    (k) The Board is hereby authorized to accept advance payment of 
assessments for the fiscal year by any person, that shall be credited 
toward any amount for which such person may become liable. The Board 
shall not be obligated to pay interest on any advance payment.



Sec. 1215.52  Exemption from assessment.

    (a) Persons that process and distribute 4 million pounds or less of 
popcorn annually, based on the previous year, shall be exempted from 
assessment.
    (b) To claim such exemption, such persons shall apply to the Board, 
in the form and manner prescribed in the rules and regulations.



Sec. 1215.53  Influencing governmental action.

    No funds received by the Board under this subpart shall in any 
manner be used for the purpose of influencing legislation or 
governmental policy or action, except to develop and recommend to the 
Secretary amendments to this subpart.

                       Reports, Books, and Records



Sec. 1215.60  Reports.

    (a) Each processor marketing popcorn directly to consumers, and each 
processor responsible for the remittance of assessments under Sec. 
1215.51, shall be required to report quarterly to the Board, on a form 
provided by the Board, such information as may be required under this 
subpart or any rule and regulations issued thereunder. Such information 
shall be subject to Sec. 1215.62 and include, but not be limited to, 
the following:
    (1) The processor's name, address, telephone number, and Social 
Security Number or Employer Identification Number;
    (2) The date of report, which is also the date of payment to the 
Board;
    (3) The period covered by the report;
    (4) The number of pounds of popcorn marketed or in any other manner 
are subject to the collection of assessments;
    (5) The amount of assessments remitted;
    (6) The basis, if necessary, to show why the remittance is less than 
the number of pounds of popcorn divided by 100 and multiplied by the 
applicable assessment rate; and
    (7) The amount of assessments remitted on exports (not including 
Canada).
    (b) The words ``final report'' shall be shown on the last report at 
the end of each fiscal year.



Sec. 1215.61  Books and records.

    Each person who is subject to this subpart shall maintain and make 
available for inspection by the Board or the Secretary such books and 
records as are deemed necessary by the Board, with the approval of the 
Secretary, to carry out the provisions of this subpart and any rules and 
regulations issued hereunder, including such books and records as are 
necessary to verify any reports required. Such books and records shall 
be retained for at least two years beyond the fiscal year of their 
applicability.



Sec. 1215.62  Confidential treatment.

    (a) All information obtained from books, records, or reports under 
the

[[Page 127]]

Act, this subpart, and the rule and regulations issued thereunder shall 
be kept confidential by all persons, including all employees, agents, 
and former employees and agents of the Board; all officers, employees, 
agents, and former officers, employees, and agents of the Department; 
and all officers, employees, agents, and former officers, employees, and 
agents of contracting and subcontracting agencies or agreeing parties 
having access to such information. Such information shall not be 
available to Board members or processors. Only those persons having a 
specific need for such information to administer effectively the 
provisions of this part shall have access to such information. Only such 
information so obtained as the Secretary deems relevant shall be 
disclosed by them, and then only in a suit or administrative hearing 
brought at the direction, or on the request, of the Secretary, or to 
which the Secretary or any officer of the United States is a party, and 
involving this part.
    (b) No information obtained under the authority of this part may be 
made available to any agency or officer of the Federal Government for 
any purpose other than the implementation of the Act and any 
investigatory or enforcement action necessary for the implementation of 
the Act.
    (c) Nothing in paragraph (a) of this section may be deemed to 
prohibit:
    (1) The issuance of general statements based upon the reports of the 
number of persons subject to this part or statistical data collected 
therefrom, which statements do not identify the information furnished by 
any person;
    (2) The publication, by direction of the Secretary, of the name of 
any person who has violated this part, together with a statement of the 
particular provisions of this part violated by such person.
    (d) Any person who knowingly violated the provisions of this 
section, on conviction, shall be subject to a fine of not more than 
$1,000 or to imprisonment for not more than 1 year, or both, or if the 
person is an officer, employee, or agent of the Board or the Department, 
that person shall be removed from office or terminated from employment 
as applicable.

                              Miscellaneous



Sec. 1215.70  Right of the Secretary.

    All fiscal matters, programs, plans, or projects, contracts, rules 
or regulations, reports, or other substantive actions proposed and 
prepared by the Board shall be submitted to the Secretary for approval.



Sec. 1215.71  Suspension or termination.

    (a) Whenever the Secretary finds that this subpart or any provision 
thereof obstructs or does not tend to effectuate the declared policy of 
the Act, the Secretary shall terminate or suspend the operation of this 
subpart or such provision thereof.
    (b) The Secretary may conduct additional referenda to determine 
whether processors favor termination or suspension of this subpart three 
years after the effective date, on the request of a representative group 
comprising 30 percent or more of the number of processors who have been 
engaged in processing during a representative period as determined by 
the Secretary.
    (c) Whenever the Secretary determines that suspension or termination 
of this subpart is favored by two-thirds or more of the popcorn 
processors voting in a referendum under paragraph (b) of this section 
who, during a representative period determined by the Secretary, have 
been engaged in the processing, the Secretary shall:
    (1) Suspend or terminate, as appropriate, collection of assessments 
within six months after making such determination; and
    (2) Suspend or terminate, as appropriate, all activities under this 
subpart in an orderly manner as soon as practicable.
    (d) Referenda conducted under this subsection shall be conducted in 
such manner as the Secretary may prescribe.



Sec. 1215.72  Proceedings after termination.

    (a) Upon the termination of this subpart, the Board shall recommend 
not more than five of its members to the Secretary to serve as trustees 
for the purpose of liquidating the affairs of the Board. Such persons, 
upon designation by the Secretary, shall become trustees

[[Page 128]]

of all the funds and property owned, in the possession of, or under the 
control of the Board, including any claims unpaid or property not 
delivered, or any other claim existing at the time of such termination.
    (b) The trustees shall:
    (1) Continue in such capacity until discharged by the Secretary;
    (2) Carry out the obligations of the Board under any contract or 
agreement entered into by it under this subpart;
    (3) From time to time account for all receipts and disbursements, 
and deliver all property on hand, together with all books and records of 
the Board and of the trustees, to such persons as the Secretary may 
direct; and
    (4) Upon the request of the Secretary, execute such assignments or 
other instruments necessary or appropriate to vest in such other persons 
full title and right to all of the funds, property, and claims vested in 
the Board or the trustees under this subpart.
    (c) Any person to whom funds, property, or claims have been 
transferred or delivered under this subpart shall be subject to the same 
obligations imposed upon the Board and upon the trustees.
    (d) Any residual funds not required to defray the necessary expenses 
of liquidation shall be turned over to the Secretary to be used, to the 
extent practicable, in the interest of continuing one or more of the 
promotion, research, consumer information or industry information 
programs, plans, or projects authorized under this subpart.



Sec. 1215.73  Effect of termination or amendment.

    Unless otherwise expressly provided by the Secretary, the 
termination of this subpart or of any rule and regulation issued under 
this subpart, or the issuance of any amendment to such provisions, shall 
not:
    (a) Affect or waive any right, duty, obligation, or liability that 
shall have arisen or may hereafter arise in connection with any 
provision of this subpart or any such rules or regulations;
    (b) Release or extinguish any violation of this subpart or any such 
rules or regulations; or
    (c) Affect or impair any rights or remedies of the United States, 
the Secretary, or any person with respect to any such violation.



Sec. 1215.74  Personal liability.

    No member or employee of the Board shall be held personally 
responsible, either individually or jointly, in any way whatsoever, to 
any person for errors in judgment, mistakes, or other acts of either 
commission or omission of such member or employee under this subpart, 
except for acts of dishonesty or willful misconduct.



Sec. 1215.75   Patents, copyrights, inventions, publications, and 
product formulations.

    Any patents, copyrights, inventions, publications, or product 
formulations developed through the use of funds received by the Board 
under this subpart shall be the property of the United States Government 
as represented by the Board and shall, along with any rents, royalties, 
residual payments, or other income from the rental, sale, leasing, 
franchising, or other uses of such patents, copyrights, inventions, 
publications, or product formulations inure to the benefit of the Board 
and be considered income subject to the same fiscal, budget, and audit 
controls as other funds of the Board. Upon termination of this subpart, 
Sec. 1215.72 shall apply to determine disposition of all such property.



Sec. 1215.76  Amendments.

    Amendments to this subpart may be proposed, from time to time, by 
the Board or by any interested persons affected by the provisions of the 
Act, including the Secretary.



Sec. 1215.77  Separability.

    If any provision of this subpart is declared invalid, or the 
applicability thereof to any person or circumstances is held invalid, 
the validity of the remainder of this subpart or the applicability 
thereof to other persons or circumstances shall not be affected thereby.

[[Page 129]]



                     Subpart B_Rules and Regulations

                               Definitions



Sec. 1215.100  Terms defined.

    Unless otherwise defined in this subpart, the definitions of terms 
used in this subpart shall have the same meaning as the definitions in 
Subpart A--Popcorn Promotion, Research, and Consumer Information Order 
of this part.

                          Exemption Procedures



Sec. 1215.300  Exemption procedures.

    (a) Any processor who markets 4 million pounds or less of popcorn 
annually and who desires to claim an exemption from assessments during a 
fiscal year as provided in Sec. 1214.52 of this part shall apply to the 
Board, on a form provided by the Board, for a certificate of exemption. 
Such processor shall certify that the processor's marketing of popcorn 
during the previous fiscal year was 4 million pounds or less.
    (b) Upon receipt of an application, the Board shall determine 
whether an exemption may be granted. The Board then will issue, if 
deemed appropriate, a certificate of exemption to each person that is 
eligible to receive one.
    (c) Any person who desires to renew the exemption from assessments 
for a subsequent fiscal year shall reapply to the Board, on a form 
provided by the Board, for a certificate of exemption.
    (d) The Board may require persons receiving an exemption from 
assessments to provide to the Board reports on the disposition of exempt 
popcorn.

                              Miscellaneous



Sec. 1215.400  OMB control numbers.

    The control number assigned to the information collection 
requirements by the Office of Management and Budget pursuant to the 
Paperwork Reduction Act of 1995, 44 U.S.C. Chapter 35, is OMB control 
number 0581-0093, except for the Promotion Board nominee background 
statement form which is assigned OMB control number 0505-0001.



PART 1216_PEANUT PROMOTION, RESEARCH, AND INFORMATION ORDER--Table 
of Contents




       Subpart A_Peanut Promotion, Research, and Information Order

                               Definitions

Sec.
1216.1 Act.
1216.2 Additional peanuts.
1216.3 Area marketing association.
1216.4 Board.
1216.5 Conflict of interest.
1216.6 Contract export additional peanuts.
1216.7 Department.
1216.8 Farm Service Agency.
1216.9 Farmers stock peanuts.
1216.10 First handler.
1216.11 Fiscal year.
1216.12 Handle.
1216.13 Information.
1216.14 Market.
1216.15 Minor peanut-producing states.
1216.16 Order.
1216.17 Part and subpart.
1216.18 Peanuts.
1216.19 Peanut producer organization.
1216.20 Person.
1216.21 Primary peanut-producing states.
1216.22 Producer.
1216.23 Promotion.
1216.24 Quota peanuts.
1216.25 Research.
1216.26 Secretary.
1216.27 Suspend.
1216.28 State.
1216.29 Terminate.
1216.30 United States.

                          National Peanut Board

1216.40 Establishment and membership.
1216.41 Nominations.
1216.42 Selection.
1216.43 Term of office.
1216.44 Vacancies.
1216.45 Alternate members.
1216.46 Procedure.
1216.47 Compensation and reimbursement.
1216.48 Powers and duties.
1216.49 Prohibited activities.

                        Expenses and Assessments

1216.50 Budget and expenses.
1216.51 Assessments.
1216.52 Programs, plans, and projects.
1216.53 Independent evaluation.
1216.54 Operating reserve.
1216.55 Investment of funds.

                       Reports, Books, and Records

1216.60 Reports.
1216.61 Books and records.
1216.62 Confidential treatment.

[[Page 130]]

             Certification of Peanut Producer Organizations

1216.70 Certification.

                              Miscellaneous

1216.80 Right of the Secretary.
1216.81 Implementation of the Order.
1216.82 Suspension and termination.
1216.83 Proceedings after termination.
1216.84 Effect of termination or amendment.
1216.85 Personal liability.
1216.86 Separability.
1216.87 Amendments.
1216.88 Patents, copyrights, trademarks, information, publications, and 
          product formulations.

Subpart B_Procedure for the Conduct of Referenda in Connection With the 
            Peanut Promotion, Research, and Information Order

1216.100 General.
1216.101 Definitions.
1216.102 Voting.
1216.103 Instructions.
1216.104 Subagents.
1216.105 Ballots.
1216.106 Referendum report.
1216.107 Confidential information.

    Authority: 7 U.S.C. 7401-7425.

    Source: 64 FR 20105, Apr. 23, 1999, unless otherwise noted.



       Subpart A_Peanut Promotion, Research, and Information Order

    Source: 64 FR 41256, July 29, 1999, unless otherwise noted.

                               Definitions



Sec. 1216.1  Act.

    Act means the Commodity Promotion, Research, and Information Act of 
1996 (7 U.S.C. 7401-7425; Public Law 104-127, 110 Stat. 1029), or any 
amendments thereto.



Sec. 1216.2  Additional peanuts.

    Additional peanuts means peanuts which are marketed from a farm 
other than peanuts marketed or considered marketed as quota peanuts.



Sec. 1216.3  Area marketing association.

    Area marketing association means an association selected and 
approved by the Secretary to conduct activities under regulations of the 
Department's Farm Service Agency. Under an interagency agreement, area 
marketing associations may assist in the collection of assessments under 
this subpart. The approved area marketing associations and the areas 
served by such associations are as follows:
    (a) GFA Peanut Association of Camilla, Georgia (GFA). GFA serves the 
southeastern area consisting of Puerto Rico, the U.S. Virgin Islands, 
and the states of Alabama, Florida, Georgia, Mississippi, and that part 
of South Carolina south and west of the Santee-Congaree-Broad Rivers;
    (b) Peanut Growers Cooperative Marketing Association of Franklin, 
Virginia (PGCMA). PGCMA serves the Virginia-Carolina area consisting of 
the District of Columbia, and the states of Connecticut, Delaware, 
Illinois, Indiana, Iowa, Kentucky, Maine, Maryland, Massachusetts, 
Michigan, Minnesota, Missouri, New Hampshire, New Jersey, New York, 
North Carolina, Ohio, Pennsylvania, Rhode Island, Tennessee, Vermont, 
Virginia, West Virginia, Wisconsin, and that part of South Carolina 
north and east of the Santee-Congaree-Broad Rivers; and
    (c) Southwestern Peanut Growers Association of Gorman, Texas 
(SWPGA). SWPGA serves the southwestern area consisting of the states of 
Alaska, Arizona, Arkansas, California, Colorado, Hawaii, Idaho, Kansas, 
Louisiana, Montana, Nebraska, New Mexico, Nevada, North Dakota, 
Oklahoma, Oregon, South Dakota, Texas, Utah, Washington, and Wyoming, 
and all other territories of the United States not listed in paragraph 
(a) or (b) of this section.



Sec. 1216.4  Board.

    Board means the administrative body referred to as the National 
Peanut Board established pursuant to Sec. 1216.40.



Sec. 1216.5  Conflict of interest.

    Conflict of interest means a situation in which a member or employee 
of the Board has a direct or indirect financial interest in a person who 
performs a service for, or enters into a contract with, the Board for 
anything of economic value.

[[Page 131]]



Sec. 1216.6  Contract export additional peanuts.

    Contract export additional peanuts are additional peanuts for 
exportation, including peanuts for crushing for exportation, for which a 
contract has been entered into between a first handler and a producer.



Sec. 1216.7  Department.

    Department means the U.S. Department of Agriculture.



Sec. 1216.8  Farm Service Agency.

    Farm Service Agency or FSA means the U.S. Department of 
Agriculture's Farm Service Agency.



Sec. 1216.9  Farmers stock peanuts.

    Farmers stock peanuts means picked or threshed peanuts produced in 
the United States which have not been changed (except for removal of 
foreign material, loose shelled kernels and excess moisture) from the 
condition in which picked or threshed peanuts are customarily marketed 
by producers, plus any loose shelled kernels that are removed from 
farmers stock peanuts before such farmers stock peanuts are marketed.



Sec. 1216.10  First handler.

    First handler means any person who handles peanuts in a capacity 
other than that of a custom cleaner or dryer, an assembler, a 
warehouseman, or other intermediary between the producer and the person 
handling.



Sec. 1216.11  Fiscal year.

    Fiscal year is synonymous with crop year and means the 12-month 
period beginning with August 1 of any year and ending with July 31 of 
the following year, or such other period as determined by the Board and 
approved by the Secretary.



Sec. 1216.12  Handle.

    Handle means to engage in the receiving or acquiring, cleaning and 
shelling, cleaning in-shell, or crushing of peanuts and in the shipment 
(except as a common or contract carrier of peanuts owned by another) or 
sale of cleaned in-shell or shelled peanuts, or other activity causing 
peanuts to enter the current of commerce: Provided, that this term does 
not include sales or deliveries of peanuts by a producer to a handler or 
to an intermediary person engaged in delivering peanuts to handler(s) 
and: Provided further, that this term does not include sales or 
deliveries of peanuts by such intermediary person(s) to a handler.



Sec. 1216.13  Information.

    Information means information and programs that are designed to 
increase efficiency in processing and to develop new markets, marketing 
strategies, increased market efficiency, and activities that are 
designed to enhance the image of peanuts on a national or international 
basis. These include:
    (a) Consumer information, which means any action taken to provide 
information to, and broaden the understanding of, the general public 
regarding the consumption, use, nutritional attributes, and care of 
peanuts; and
    (b) Producer information, which means information and programs that 
will lead to the development of new markets, new marketing strategies, 
or increased efficiency for the peanut industry, and activities to 
enhance the image of the peanut industry.



Sec. 1216.14  Market.

    Market means to sell or otherwise dispose of peanuts into 
interstate, foreign, or intrastate commerce by buying, marketing, 
distributing, or otherwise placing peanuts into commerce.



Sec. 1216.15  Minor peanut-producing states.

    Minor peanut-producing states means all peanut-producing states with 
the exception of Alabama, Florida, Georgia, New Mexico, North Carolina, 
Oklahoma, South Carolina, Texas, and Virginia.



Sec. 1216.16  Order.

    Order means an Order issued by the Secretary under section 514 of 
the Act that provides for a program of generic promotion, research, and 
information regarding agricultural commodities authorized under the Act.

[[Page 132]]



Sec. 1216.17  Part and subpart.

    Part means the Peanut Promotion, Research, and Information Order and 
all rules, regulations, and supplemental Orders issued pursuant to the 
Act and the Order. The Order shall be a ``subpart'' of such part.



Sec. 1216.18  Peanuts.

    Peanuts means the seeds of the legume arachis hypogaea and includes 
both in-shell and shelled peanuts other than those marketed by the 
producer in green form for consumption as boiled peanuts.



Sec. 1216.19  Peanut producer organization.

    Peanut producer organization means a state-legislated peanut 
promotion, research, and education commission or organization. For 
states without a state-legislated peanut promotion, research, and 
education commission or organization, ``peanut producer organization'' 
means any organization which has the primary purpose of representing 
peanut producers and has peanut producers as members.



Sec. 1216.20  Person.

    Person means any individual, group of individuals, partnership, 
corporation, association, cooperative, or any other legal entity.



Sec. 1216.21  Primary peanut-producing states.

    Primary peanut-producing states means Alabama, Florida, Georgia, New 
Mexico, North Carolina, Oklahoma, South Carolina, Texas, and Virginia, 
Provided, these states maintain three-year average production of at 
least 10,000 tons of peanuts.



Sec. 1216.22  Producer.

    Producer means any person engaged in the production and sale of 
peanuts and who owns, or shares the ownership and risk of loss of the 
crop. This does not include quota holders who do not share in the risk 
of loss of the crop.



Sec. 1216.23  Promotion.

    Promotion means any action taken by the Board under this Order, 
including paid advertising, to present a favorable image of peanuts to 
the public to improve the competitive position of peanuts in the 
marketplace, including domestic and international markets, and to 
stimulate sales of peanuts.



Sec. 1216.24  Quota peanuts.

    Quota peanuts means peanuts which are:
    (a) Eligible for domestic edible uses; and
    (b) Marketed or considered marketed from a farm as quota peanuts 
pursuant to the provisions of 7 CFR Part 729 and are not in excess of 
the effective farm poundage quota established for the farm on which such 
peanuts were produced.



Sec. 1216.25  Research.

    Research means any type of test, study, or analysis designed to 
advance the image, desirability, use, marketability, production, product 
development, or quality of peanuts, including research relating to 
nutritional value and cost of production.



Sec. 1216.26  Secretary.

    Secretary means the Secretary of Agriculture of the United States, 
or any officer or employee of the U.S. Department of Agriculture to whom 
authority has heretofore been delegated, or to whom authority may 
hereafter be delegated, to act in the Secretary's stead.



Sec. 1216.27  Suspend.

    Suspend means to issue a rule under section 553 of title 5, United 
States Code, to temporarily prevent the operation of an Order, or part 
thereof, during a particular period of time specified in the rule.



Sec. 1216.28  State.

    State means any of the 50 states, the District of Columbia, the 
Commonwealth of Puerto Rico, or any territory or possession of the 
United States.



Sec. 1216.29  Terminate.

    Terminate means to issue a rule under section 553 of title 5, United 
States Code, to cancel permanently the operation of an Order, or part 
thereof, beginning on a date certain specified in the rule.

[[Page 133]]



Sec. 1216.30  United States.

    United States means collectively the 50 states, the District of 
Columbia, the Commonwealth of Puerto Rico, and the territories and 
possessions of the United States.

                          National Peanut Board



Sec. 1216.40  Establishment and membership.

    (a) Establishment of a National Peanut Board. There is hereby 
established a National Peanut Board, hereinafter called the Board, 
composed of no more than 10 peanut producers and alternates, appointed 
by the Secretary from nominations as follows:
    (1) Nine members and alternates. One member and one alternate shall 
be appointed from each primary peanut-producing state, who are producers 
and whose nominations have been submitted by certified peanut producer 
organizations within a primary peanut-producing state.
    (2) The minor peanut-producing states shall collectively have one 
at-large member and one alternate, who are producers, to be appointed by 
the Secretary from nominations submitted by certified peanut producer 
organizations within minor peanut-producing states or from other 
certified farm organizations that include peanut producers as part of 
their membership.
    (b) Adjustment of membership. At least once in each five-year 
period, but not more frequently than once in each three-year period, the 
Board, or a person or agency designated by the Board, shall review the 
geographical distribution of peanuts in the United States and make 
recommendation(s) to the Secretary to continue without change, or 
whether changes should be made in the number of representatives on the 
Board to reflect changes in the geographical distribution of the 
production of peanuts.



Sec. 1216.41  Nominations.

    (a) All nominations authorized under Sec. 1216.40 shall be made 
within such a period of time as the Secretary shall prescribe. Eligible 
peanut producer organizations within each state as certified pursuant to 
Sec. 1216.70 shall nominate two qualified persons for each member and 
each alternate member. The nominees shall be elected at an open meeting 
among peanut producers eligible to serve on the Board. Any certified 
peanut producer organization representing a minor peanut-producing state 
may nominate two eligible persons for each member and two eligible 
persons for each alternate member.
    (b) As soon as practicable after this subpart becomes effective, the 
Secretary shall obtain nominations for appointment to the initial 
promotion Board from certified nominating organizations. In any 
subsequent year in which an appointment to the Board is to be made, 
nominations for positions whose terms will expire shall be obtained from 
certified nominating organizations by the Board's staff and submitted to 
the Secretary by May 1 of such year, or other such date as approved by 
the Secretary.
    (c) Except for initial Board members, whose nomination process will 
be initiated by the Secretary, the Board shall issue the call for 
nominations by March 1 of each year.
    (d) The nomination meeting shall be announced 30 days in advance:
    (1) By utilizing available media or public information sources, 
without incurring advertising expense, to publicize the dates, places, 
method of voting, eligibility requirements, and other pertinent 
information. Such sources of publicity may include, but are not limited 
to, print and radio; and
    (2) By such other means as deemed advisable.
    (e) At nominations meetings, Department personnel will be present to 
oversee and to verify eligibility and count ballots.



Sec. 1216.42  Selection.

    From the nominations, the Secretary shall select the members of the 
Board and alternates for each primary peanut-producing state. The 
Secretary shall select one member and one alternate from all nominations 
submitted by certified peanut producer organizations representing minor 
peanut-producing states.



Sec. 1216.43  Term of office.

    All members and alternates of the Board shall each serve for terms 
of

[[Page 134]]

three years, except that the members and alternates appointed to the 
initial Board shall serve proportionately for two-, three-, and four-
year terms, with the length of the terms determined at random. No member 
or alternate may serve more than two consecutive three-year terms. An 
alternate, after serving two consecutive three-year terms, may serve as 
a member for an additional two consecutive three-year terms. A member, 
after serving two consecutive three-year terms, may serve as an 
alternate for an additional two consecutive three-year terms. Each 
member and alternate shall continue to serve until a successor is 
selected and has qualified.
    (a) Those members serving initial terms of two or four years may 
serve one successive three-year term.
    (b) Any successor serving one year or less may serve two consecutive 
three-year terms.



Sec. 1216.44  Vacancies.

    To fill any vacancy resulting from the failure to qualify of any 
person selected as a member or as an alternate member of the Board, or 
in the event of death, removal, resignation, or disqualification of any 
member or alternate member of the Board, a successor for the unexpired 
term of such member or alternate member of the Board shall be nominated 
and selected in the manner specified in Sec. 1216.40.



Sec. 1216.45  Alternate members.

    An alternate member of the Board, during the absence of the member 
for the primary peanut-producing state or at-large member for whom the 
person is the alternate, shall act in the place and stead of such member 
and perform such duties as assigned. In the event of death, removal, 
resignation, or disqualification of any member, the alternate for that 
state or at-large member shall act for the member until a successor for 
such member is selected and qualified. In the event that both a producer 
member of the Board and the alternate are unable to attend a meeting, 
the Board may not designate any other alternate to serve in such 
member's or alternate's place and stead for such a meeting.



Sec. 1216.46  Procedure.

    (a) A majority of the members of the Board, including alternate 
members acting for members, shall constitute a quorum.
    (b) At assembled meetings, all votes shall be cast in person. Board 
actions shall be weighted by value of production as determined by a 
primary peanut-producing state's three-year running average of total 
gross farm income derived from all peanut sales. The at-large Board 
member's vote shall be weighted by the collective value of production 
from all minor peanut-producing states' three-year running average of 
total gross farm income derived from all peanut sales. Any Board action 
shall require the concurring votes of members or alternates from states 
representing more than 50 percent of total U.S. gross farm income 
derived from all peanut sales, plus an additional two votes from any 
other Board members, provided a minimum of five votes concur.
    (c) For routine and noncontroversial matters which do not require 
deliberation and the exchange of views, and in matters of an emergency 
nature when there is not time to call an assembled meeting of the Board, 
the Board may also take action as prescribed in this section by mail, 
facsimile, telephone, or any telecommunication method appropriate for 
the conduct of business, but any such action shall be confirmed in 
writing within 30 days.
    (d) There shall be no voting by proxy.
    (e) The chairperson shall be a voting member.



Sec. 1216.47  Compensation and reimbursement.

    The members of the Board, and alternates when acting as members, 
shall serve without compensation but shall be reimbursed for reasonable 
travel expenses, as approved by the Board, incurred by them in the 
performance of their duties as Board members.



Sec. 1216.48  Powers and duties.

    The Board shall have the following powers and duties:
    (a) To administer the Order in accordance with its terms and 
conditions and to collect assessments;

[[Page 135]]

    (b) To develop and recommend to the Secretary for approval such 
bylaws as may be necessary for the functioning of the Board, and such 
rules as may be necessary to administer the Order, including activities 
authorized to be carried out under the Order;
    (c) To meet, organize, and select from among the members of the 
Board a chairperson, other officers, committees, and subcommittees, as 
the Board determines to be appropriate;
    (d) To employ persons, other than the members, as the Board 
considers necessary to assist the Board in carrying out its duties and 
to determine the compensation and specify the duties of such persons;
    (e) To develop programs and projects, and enter into contracts or 
agreements, which must be approved by the Secretary before becoming 
effective, for the development and carrying out of programs or projects 
of research, information, or promotion, and the payment of costs thereof 
with funds collected pursuant to this subpart. Each contract or 
agreement shall provide that any person who enters into a contract or 
agreement with the Board shall develop and submit to the Board a 
proposed activity; keep accurate records of all of its transactions 
relating to the contract or agreement; account for funds received and 
expended in connection with the contract or agreement; make periodic 
reports to the Board of activities conducted under the contract or 
agreement; and make such other reports available as the Board or the 
Secretary considers relevant. Any contract or agreement shall provide 
that:
    (1) The contractor or agreeing party shall develop and submit to the 
Board a program, plan, or project together with a budget or budgets that 
show the estimated cost to be incurred for such program, plan, or 
project;
    (2) The contractor or agreeing party shall keep accurate records of 
all its transactions and make periodic reports to the Board of 
activities conducted, submit accounting for funds received and expended, 
and make such other reports as the Secretary or the Board may require;
    (3) The Secretary may audit the records of the contracting or 
agreeing party periodically; and
    (4) Any subcontractor who enters into a contract with a Board 
contractor and who receives or otherwise uses funds allocated by the 
Board shall be subject to the same provisions as the contractor;
    (f) To prepare and submit for approval of the Secretary fiscal year 
budgets in accordance with Sec. 1216.50;
    (g) To maintain such records and books and prepare and submit such 
reports and records from time to time to the Secretary as the Secretary 
may prescribe; to make appropriate accounting with respect to the 
receipt and disbursement of all funds entrusted to it; and to keep 
records that accurately reflect the actions and transactions of the 
Board;
    (h) To cause its books to be audited by a competent auditor at the 
end of each fiscal year and at such other times as the Secretary may 
request, and to submit a report of the audit directly to the Secretary;
    (i) To give the Secretary the same notice of meetings of the Board 
as is given to members in order that the Secretary's representative(s) 
may attend such meetings, and to keep and report minutes of each meeting 
of the Board to the Secretary;
    (j) To act as intermediary between the Secretary and any producer or 
first handler;
    (k) To furnish to the Secretary any information or records that the 
Secretary may request;
    (l) To receive, investigate, and report to the Secretary complaints 
of violations of the Order;
    (m) To recommend to the Secretary such amendments to the Order as 
the Board considers appropriate; and
    (n) To work to achieve an effective, continuous, and coordinated 
program of promotion, research, consumer information, evaluation, and 
industry information designed to strengthen the peanut industry's 
position in the marketplace; maintain and expand existing markets and 
uses for peanuts; and to carry out programs, plans, and projects 
designed to provide maximum benefits to the peanut industry.

[[Page 136]]



Sec. 1216.49  Prohibited activities.

    The Board may not engage in, and shall prohibit the employees and 
agents of the Board from engaging in:
    (a) Any action that would be a conflict of interest;
    (b) Using funds collected by the Board under the Order to undertake 
any action for the purpose of influencing legislation or governmental 
action or policy, including local, state, national, and international, 
other than recommending to the Secretary amendments to the Order; and
    (c) Any advertising, including promotion, research, and information 
activities authorized to be carried out under the Order, that is false 
or misleading or disparaging to another agricultural commodity.

                        Expenses and Assessments



Sec. 1216.50  Budget and expenses.

    (a) At least 60 days prior to the beginning of each fiscal year, and 
as may be necessary thereafter, the Board shall prepare and submit to 
the Secretary a budget for the fiscal year covering its anticipated 
expenses and disbursements in administering this subpart. Each such 
budget shall include:
    (1) A statement of objectives and strategy for each program, plan, 
or project;
    (2) A summary of anticipated revenue, with comparative data for at 
least one preceding year (except for the initial budget);
    (3) A summary of proposed expenditures for each program, plan, or 
project; and
    (4) Staff and administrative expense breakdowns, with comparative 
data for at least one preceding year (except for the initial budget).
    (b) Each budget shall provide adequate funds to defray its proposed 
expenditures and to provide for a reserve as set forth in this subpart.
    (c) Subject to this section, any amendment or addition to an 
approved budget must be approved by the Secretary, including shifting 
funds from one program, plan, or project to another. Shifts of funds 
which do not cause an increase in the Board's approved budget and which 
are consistent with governing bylaws need not have prior approval by the 
Secretary.
    (d) The Board is authorized to incur such expenses, including 
provision for a reasonable reserve, as the Secretary finds are 
reasonable and likely to be incurred by the Board for its maintenance 
and functioning, and to enable it to exercise its powers and perform its 
duties in accordance with the provisions of this subpart. Such expenses 
shall be paid from funds received by the Board.
    (e) With approval of the Secretary, the Board may borrow money for 
the payment of administrative expenses, subject to the same fiscal, 
budget, and audit controls as other funds of the Board. Any funds 
borrowed by the Board shall be expended only for startup costs and 
capital outlays and are limited to the first year of operation of the 
Board.
    (f) The Board may accept voluntary contributions, but these shall 
only be used to pay expenses incurred in the conduct of programs, plans, 
and projects. Such contributions shall be free from any encumbrance by 
the donor and the Board shall retain complete control of their use.
    (g) The Board shall reimburse the Secretary for all expenses 
incurred by the Secretary in the implementation, administration, and 
supervision of the Order, including all referendum costs in connection 
with the Order.
    (h) The Board may not expend for administration, maintenance, and 
functioning of the Board in any fiscal year an amount that exceeds 10 
percent of the assessments and other income received by the Board for 
that fiscal year. Reimbursements to the Secretary required under 
paragraph (g) of this section are excluded from this limitation on 
spending.
    (i) The Board shall allocate, to the extent practicable, no less 
than 80 percent of the assessments collected on all peanuts available 
for any fiscal year on national and regional promotion, research, and 
information activities. The Board shall allocate, to the extent 
practicable, no more than 20 percent of assessments collected on all 
peanuts available for any fiscal year for use in state or regional 
research programs. Specific percentages and amounts shall

[[Page 137]]

be determined annually by the Board, with the approval of the Secretary.
    (j) Certified peanut producer organizations may submit requests for 
funding for research and/or generic promotion projects. Amounts approved 
for each state shall not exceed the pro rata Share of funds available 
for that State as determined by the Board and approved by the Secretary. 
Amounts allocated by the Board for state research or promotion 
activities will be based on requests submitted to the Board when it is 
determined that they meet the goals and objectives stated in the Order.
    (k) Assessments collected, less pro rata administrative expenses, 
from the gross sales of contract export additional peanuts shall be 
allocated by the Board for the promotion and related research of export 
peanuts.
    (l) The Board shall determine annually how total funds shall be 
allocated pursuant to paragraphs (i), (j), and (k) of this section, with 
the approval of the Secretary.



Sec. 1216.51  Assessments.

    (a) The funds to cover the Board's expenses shall be acquired by the 
levying of assessments upon producers in a manner prescribed by the 
Secretary.
    (b) Each first handler, at such times and in such manner as 
prescribed by the Secretary, shall collect from each producer and pay 
assessments to the Board on all peanuts handled, including peanuts 
produced by the first handler, no later than 60 days after the last day 
of the month in which the peanuts were marketed.
    (c) Such assessments shall be levied at a rate of 1 percent of the 
price paid for all farmers stock peanuts sold. Price paid is the value 
of segment entry on the FSA 1007 form.
    (d) For peanuts placed under loan with the Department's Commodity 
Credit Corporation, each area marketing association shall remit to the 
Board the following:
    (1) One (1) percent of the initial price paid for either quota or 
additional peanuts no more than 60 days after the last day of the month 
in which the peanuts were placed under loan; and
    (2) One (1) percent of the profit from the sale of the peanuts 
within 60 days after the final day of the area association's fiscal 
year.
    (e) All assessments collected under this section are to be used for 
expenses and expenditures pursuant to this Order and for the 
establishment of an operating reserve as prescribed in the Order.
    (f) The Board shall impose a late payment charge on any person who 
fails to remit to the Board the total amount for which the person is 
liable on or before the payment due date established under this section. 
The late payment charge will be in the form of interest on the 
outstanding portion of any amount for which the person is liable. The 
rate of interest shall be prescribed in regulations issued by the 
Secretary.
    (g) Persons failing to remit total assessments due in a timely 
manner may also be subject to actions under federal debt collection 
procedures.
    (h) The Board may authorize other organizations to collect 
assessments on its behalf with the approval of the Secretary.
    (i) The assessment rate may not be increased unless the new rate is 
approved by a referendum among eligible producers.



Sec. 1216.52  Programs, plans, and projects.

    (a) The Board shall receive and evaluate, or on its own initiative 
develop, and submit to the Secretary for approval any program, plan, or 
project authorized under this subpart. Such programs, plans, or projects 
shall provide for:
    (1) The establishment, issuance, effectuation, and administration of 
appropriate programs for promotion, research, and information, including 
producer and consumer information, with respect to peanuts; and
    (2) The establishment and conduct of research with respect to the 
use, nutritional value, sale, distribution, and marketing of peanuts and 
peanut products, and the creation of new products thereof, to the end 
that marketing and use of peanuts may be encouraged, expanded, improved, 
or made more acceptable and to advance the image, desirability, or 
quality of peanuts.
    (b) No program, plan, or project shall be implemented prior to its 
approval

[[Page 138]]

by the Secretary. Once a program, plan, or project is so approved, the 
Board shall take appropriate steps to implement it.
    (c) Each program, plan, or project implemented under this subpart 
shall be reviewed or evaluated periodically by the Board to ensure that 
it contributes to an effective program of promotion, research, or 
consumer information. If it is found by the Board that any such program, 
plan, or project does not contribute to an effective program of 
promotion, research, or consumer information, then the Board shall 
terminate such program, plan, or project.
    (d) No program, plan, or project shall make any false claims on 
behalf of peanuts or use unfair or deceptive acts or practices with 
respect to the quality, value, or use of any competing product. Peanuts 
of all domestic origins shall be treated equally.



Sec. 1216.53  Independent evaluation.

    The Board shall, not less often than every five years, authorize and 
fund, from funds otherwise available to the Board, an independent 
evaluation of the effectiveness of the Order and other programs 
conducted by the Board pursuant to the Act. The Board shall submit to 
the Secretary, and make available to the public, the results of each 
periodic independent evaluation conducted under this section.



Sec. 1216.54  Operating reserve.

    The Board shall establish an operating monetary reserve and may 
carry over to subsequent fiscal years excess funds in a reserve so 
established; Provided, that funds in the reserve shall not exceed any 
fiscal year's anticipated expenses.



Sec. 1216.55  Investment of funds.

    The Board may invest, pending disbursement, funds it receives under 
this subpart, only in obligations of the United States or any agency of 
the United States; general obligations of any state or any political 
subdivision of a state; interest bearing accounts or certificates of 
deposit of financial institutions that are members of the Federal 
Reserve system; or obligations that are fully guaranteed as to principal 
and interest by the United States.

                       Reports, Books, and Records



Sec. 1216.60  Reports.

    (a) Each producer and first handler subject to this part shall be 
required to report to the employees of the Board, at such times and in 
such manner as it may prescribe, such information as may be necessary 
for the Board to perform its duties. Such reports shall include, but 
shall not be limited to the following:
    (1) Number of pounds of peanuts produced or handled;
    (2) Price paid to producers (entry in value of segment section on 
the FSA 1007 form); and
    (3) Total assessments collected.
    (b) First Handlers shall submit monthly reports to the Board. These 
reports shall accompany the payment of the collected assessments and 
shall be due 60 days after the last day of the month in which the 
peanuts were marketed.



Sec. 1216.61  Books and records.

    Each first handler and producer subject to this subpart shall 
maintain and make available for inspection by the Secretary and 
employees and agents of the Board such books and records as are 
necessary to carry out the provisions of this subpart and the 
regulations issued thereunder, including such records as are necessary 
to verify any reports required. Such records shall include but are not 
limited to the following: copies of FSA 1007 forms, the names and 
address of producers, and the date the assessments were collected. Such 
records shall be retained for at least two years beyond the marketing 
year of their applicability.



Sec. 1216.62  Confidential treatment.

    All information obtained from books, records, or reports under the 
Act, this subpart, and the regulations issued thereunder shall be kept 
confidential by all persons, including all employees and former 
employees of the Board, all officers and employees and former officers 
and employees of contracting and subcontracting agencies or agreeing 
parties having access to such information. Such information shall not be 
available to Board members, producers, importers, exporters, or 
handlers. Only

[[Page 139]]

those persons having a specific need for such information to effectively 
administer the provisions of this subpart shall have access to such 
information. Only such information so obtained as the Secretary deems 
relevant shall be disclosed by them, and then only in a judicial 
proceeding or administrative hearing brought at the direction, or on the 
request, of the Secretary, or to which the Secretary or any officer of 
the United States is a party, and involving this subpart. Nothing in 
this section shall be deemed to prohibit:
    (a) The issuance of general statements based upon the reports of the 
number of persons subject to this subpart or statistical data collected 
therefrom, which statements do not identify the information furnished by 
any person; and
    (b) The publication, by direction of the Secretary, of the name of 
any person who has been adjudged to have violated this subpart, together 
with a statement of the particular provisions of this subpart violated 
by such person.

             Certification of Peanut Producer Organizations



Sec. 1216.70  Certification.

    (a) Organizations receiving certification from the Secretary will be 
entitled to submit nominations for Board membership to the Secretary for 
appointment and to submit requests for funding to the Board.
    (b) For major peanut-producing states, state-legislated peanut 
promotion, research, and information organizations may request 
certification, provided the state-legislated promotion program submits a 
factual report that shall contain information deemed relevant and 
specified by the Secretary for the making of such determination pursuant 
to paragraph (e) of this section.
    (c) If a state-legislated peanut promotion, research and information 
organization in a major peanut-producing state does not elect to seek 
certification from the Secretary within a specified time period as 
determined by the Secretary, or does not meet eligibility requirements 
as specified by the Secretary, then any peanut producer organization 
whose primary purpose is to represent peanut producers within a primary 
peanut-producing state, or any other organization which has peanut 
producers as part of its membership, may request certification. 
Certification shall be based, in addition to other available 
information, upon a factual report submitted by the organization that 
shall contain information deemed relevant and specified by the Secretary 
for the making of such determination pursuant to paragraph (e) of this 
section.
    (d) For minor peanut-producing states, any organization that has 
peanut producers as part of its membership may request certification.
    (e) The information required for certification by the Secretary may 
include, but is not limited to, the following:
    (1) The geographic distribution within the state covered by the 
organization's active membership;
    (2) The nature and size of the organization's active membership in 
the state, proportion of the organization's active membership accounted 
for by producers, a map showing the peanut-producing counties in the 
state in which the organization has members, the volume of peanuts 
produced in each county, the number of peanut producers in each county, 
and the size of the organization's active peanut producer membership in 
each county;
    (3) The extent to which the peanut producer membership of such 
organization is represented in setting the organization's policies;
    (4) Evidence of stability and permanency of the organization;
    (5) Sources from which the organization's operating funds are 
derived;
    (6) Functions of the organization;
    (7) The organization's ability and willingness to further the aims 
and objectives of the Act and Order; and,
    (8) Demonstrated experience administering generic state promotion 
and research programs.
    (f) The Secretary's determination as to eligibility or certification 
of an organization shall be final.

[[Page 140]]

                              Miscellaneous



Sec. 1216.80  Right of the Secretary.

    All fiscal matters, programs, plans, or projects, rules or 
regulations, reports, or other substantive actions proposed and prepared 
by the Board shall be submitted to the Secretary for approval.



Sec. 1216.81  Implementation of the Order.

    The Order shall not become effective unless:
    (a) The Secretary determines that the Order is consistent with and 
will effectuate the purposes of the Act; and
    (b) The Order is approved by a simple majority of the peanut 
producers as defined in Sec. 1216.21 voting in a referendum who, during 
a representative period determined by the Secretary, have been engaged 
in the production of peanuts.



Sec. 1216.82  Suspension and termination.

    (a) The Secretary shall suspend or terminate this subpart or a 
provision thereof if the Secretary finds that this subpart or a 
provision thereof obstructs or does not tend to effectuate the purposes 
of the Act, or if the Secretary determines that this subpart or a 
provision thereof is not favored by persons voting in a referendum 
conducted pursuant to the Act.
    (b) Every five years, the Secretary shall hold a referendum to 
determine whether peanut producers favor the continuation of the Order. 
The Secretary will also conduct a referendum if 10 percent or more of 
all eligible peanut producers request the Secretary to hold a 
referendum. In addition, the Secretary may hold a referendum at any 
time.
    (c) The Secretary shall suspend or terminate this subpart at the end 
of the marketing year whenever the Secretary determines that its 
suspension or termination is approved or favored by a simple majority of 
the producers voting in a referendum who, during a representative period 
determined by the Secretary, have been engaged in the production of 
peanuts.
    (d) If, as a result of the referendum conducted under paragraph (b) 
of this section, the Secretary determines that this subpart is not 
approved, the Secretary shall:
    (1) Not later than 180 days after making the determination, suspend 
or terminate, as the case may be, collection of assessments under this 
subpart; and
    (2) As soon as practical, suspend or terminate, as the case may be, 
activities under this subpart in an Orderly manner.



Sec. 1216.83  Proceedings after termination.

    (a) Upon the termination of this subpart, the Board shall recommend 
not more than three of its members to the Secretary to serve as trustees 
for the purpose of liquidating the affairs of the Board. Such persons, 
upon designation by the Secretary, shall become trustees of all the 
funds and property then in the possession or under control of the Board, 
including claims for any funds unpaid or property not delivered, or any 
other claim existing at the time of such termination.
    (b) The said trustees shall:
    (1) Continue in such capacity until discharged by the Secretary;
    (2) Carry out the obligations of the Board under any contracts or 
agreements entered into pursuant to the Order;
    (3) From time to time, account for all receipts and disbursements 
and deliver all property on hand, together with all books and records of 
the Board and the trustees, to such person or persons as the Secretary 
may direct; and
    (4) Upon request of the Secretary execute such assignments or other 
instruments necessary and appropriate to vest in such persons title and 
right to all funds, property and claims vested in the Board or the 
trustees pursuant to the Order.
    (c) Any person to whom funds, property or claims have been 
transferred or delivered pursuant to the Order shall be subject to the 
same obligations imposed upon the Board and upon the trustees.
    (d) Any residual funds not required to defray the necessary expenses 
of liquidation shall be turned over to the Secretary to be disposed of, 
to the extent practical, to the peanut producer organizations, certified 
pursuant to Sec. 1216.70, in the interest of continuing peanut 
promotion, research, and information programs.

[[Page 141]]



Sec. 1216.84  Effect of termination or amendment.

    Unless otherwise expressly provided by the Secretary, the 
termination of this subpart or of any regulation issued pursuant 
thereto, or the issuance of any amendment to either thereof, shall not:
    (a) Affect or waive any right, duty, obligation or liability which 
shall have arisen or which may thereafter arise in connection with any 
provision of this subpart or any regulation issued thereunder; or
    (b) Release or extinguish any violation of this subpart or any 
regulation issued thereunder; or
    (c) Affect or impair any rights or remedies of the United States, or 
of the Secretary or of any other persons, with respect to any such 
violation.



Sec. 1216.85  Personal liability.

    No member or alternate member of the Board shall be held personally 
responsible, either individually or jointly with others, in any way 
whatsoever, to any person for errors in judgment, mistakes, or other 
acts, either of commission or omission, as such member or alternate, 
except for acts of dishonesty or willful misconduct.



Sec. 1216.86  Separability.

    If any provision of this subpart is declared invalid or the 
applicability thereof to any person or circumstances is held invalid, 
the validity of the remainder of this subpart or the applicability 
thereof to other persons or circumstances shall not be affected thereby.



Sec. 1216.87  Amendments.

    Amendments to this subpart may be proposed, from time to time, by 
the Board or by any interested person affected by the provisions of the 
Act, including the Secretary.



Sec. 1216.88  Patents, copyrights, trademarks, information, publications, 
and product formulations.

    Patents, copyrights, trademarks, information, publications, and 
product formulations developed through the use of funds received by the 
Board under this subpart shall be the property of the U.S. Government as 
represented by the Board and shall, along with any rents, royalties, 
residual payments, or other income from the rental, sales, leasing, 
franchising, or other uses of such patents, copyrights, trademarks, 
information, publications, or product formulations, inure to the benefit 
of the Board; shall be considered income subject to the same fiscal, 
budget, and audit controls as other funds of the Board; and may be 
licensed subject to approval by the Secretary. Upon termination of this 
subpart, Sec. 1216.82 shall apply to determine disposition of all such 
property.



Subpart B_Procedure for the Conduct of Referenda in Connection With the 
            Peanut Promotion, Research, and Information Order



Sec. 1216.100  General.

    Referenda to determine whether eligible peanut producers favor the 
issuance, amendment, suspension, or termination of a Peanut Promotion, 
Research, and Information Order shall be conducted in accordance with 
this subpart.



Sec. 1216.101  Definitions.

    The following definitions apply to this subpart:
    (a) Administrator means the Administrator of the Agricultural 
Marketing Service, with power to redelegate, or any officer or employee 
of the Department to whom authority has been delegated or may hereafter 
be delegated to act in the Administrator's stead.
    (b) Order means the Peanut Promotion, Research, and Information 
Order.
    (c) Referendum agent or agent means the individual or individuals 
designated by the Secretary to conduct the referendum.
    (d) Representative period means the period designated by the 
Secretary.
    (e) Person means any individual, group of individuals, partnership, 
corporation, association, cooperative, or any other legal entity. For 
the purpose of this definition, the term ``partnership'' includes, but 
is not limited to:

[[Page 142]]

    (1) A husband and a wife who have title to, or leasehold interest 
in, a peanut farm as tenants in common, joint tenants, tenants by the 
entirety, or, under community property laws, as community property; and
    (2) So-called ``joint ventures'' wherein one or more parties to an 
agreement, informal or otherwise, contributed land and others 
contributed capital, labor, management, or other services, or any 
variation of such contributions by two or more parties.
    (f) Eligible producer means any person who is engaged in the 
production and sale of peanuts in the United States and who:
    (1) Owns, or shares the ownership and risk of loss of, the crop. 
This does not include quota holders who do not share in the risk of loss 
of the crop;
    (2) Rents peanut production facilities and equipment resulting in 
the ownership of all or a portion of the peanuts produced;
    (3) Owns peanut production facilities and equipment but does not 
manage them and, as compensation, obtains the ownership of a portion of 
the peanuts produced; or
    (4) Is a party in a landlord-tenant relationship or a divided 
ownership arrangement involving totally independent entities cooperating 
only to produce peanuts who share the risk of loss and receive a share 
of the peanuts produced. No other acquisition of legal title to peanuts 
shall be deemed to result in persons becoming eligible producers.



Sec. 1216.102  Voting.

    (a) Each person who is an eligible producer, as defined in this 
subpart, at the time of the referendum and during the representative 
period, shall be entitled to cast only one ballot in the referendum. 
However, each producer in a landlord-tenant relationship or a divided 
ownership arrangement involving totally independent entities cooperating 
only to produce peanuts, in which more than one of the parties is a 
producer, shall be entitled to cast one ballot in the referendum 
covering only such producer's share of the ownership.
    (b) Proxy voting is not authorized, but an officer or employee of an 
eligible corporate producer, or an administrator, executor, or trustee 
or an eligible producing entity may cast a ballot on behalf of such 
producer. Any individual so voting in a referendum shall certify that 
such individual is an officer or employee of the eligible producer, or 
an administrator, executive, or trustee of an eligible producing entity 
and that such individual has the authority to take such action. Upon 
request of the referendum agent, the individual shall submit adequate 
evidence of such authority.
    (c) All ballots are to be cast by mail or by facsimile, as 
instructed by the Secretary.



Sec. 1216.103  Instructions.

    The referendum agent shall conduct the referendum, in the manner 
provided in this subpart, under the supervision of the Administrator. 
The Administrator may prescribe additional instructions, not 
inconsistent with the provisions hereof, to govern the procedure to be 
followed by the referendum agent. Such agent shall:
    (a) Determine the period during which ballots may be cast.
    (b) Provide ballots and related material to be used in the 
referendum. The ballot shall provide for recording essential 
information, including that needed for ascertaining whether the person 
voting, or on whose behalf the vote is cast, is an eligible voter.
    (c) Give reasonable public notice of the referendum:
    (1) By utilizing available media or public information sources, 
without incurring advertising expense, to publicize the dates, places, 
method of voting, eligibility requirements, and other pertinent 
information. Such sources of publicity may include, but are not limited 
to, print and radio; and
    (2) By such other means as the agent may deem advisable.
    (d) Mail to eligible producers whose names and addresses are known 
to the referendum agent, the instructions on voting, a ballot, and a 
summary of the terms and conditions of the Peanut Promotion, Research, 
and Information Order. No person who claims to be eligible to vote shall 
be refused a ballot.
    (e) At the end of the voting period, collect, open, number, and 
review the ballots and tabulate the results in the

[[Page 143]]

presence of an agent of a third party authorized to monitor the 
referendum process.
    (f) Prepare a report on the referendum.
    (g) Announce the results to the public.



Sec. 1216.104  Subagents.

    The referendum agent may appoint any individual or individuals 
necessary or desirable to assist the agent in performing such agent's 
functions under this subpart. Each individual so appointed may be 
authorized by the agent to perform any or all of the functions which, in 
the absence of such appointment, shall be performed by the agent.



Sec. 1216.105  Ballots.

    The referendum agent and subagents shall accept all ballots cast. 
However, if an agent or subagent deems that a ballot should be 
challenged for any reason, the agent or subagent shall endorse above 
their signature, on the ballot, a statement to the effect that such 
ballot was challenged, by whom challenged, the reasons therefor, the 
results of any investigations made with respect thereto, and the 
disposition thereof. Ballots invalid under this subpart shall not be 
counted.



Sec. 1216.106  Referendum report.

    Except as otherwise directed, the referendum agent shall prepare and 
submit to the Administrator a report on results of the referendum, the 
manner in which it was conducted, the extent and kind of public notice 
given, and other information pertinent to analysis of the referendum and 
its results.



Sec. 1216.107  Confidential information.

    The ballots and other information or reports that reveal, or tend to 
reveal, the vote of any person covered under the Act and the voting list 
shall be held confidential and shall not be disclosed.



PART 1218_BLUEBERRY PROMOTION, RESEARCH, AND INFORMATION ORDER--Table 
of Contents




     Subpart A_Blueberry Promotion, Research, and Information Order

                               Definitions

Sec.
1218.1 Act.
1218.2 Blueberries.
1218.3 Conflict of interest.
1218.4 Crop year.
1218.5 Department.
1218.6 Exporter.
1218.7 First handler.
1218.8 Fiscal period.
1218.9 Importer.
1218.10 Information.
1218.11 Market or marketing.
1218.12 Order.
1218.13 Part and subpart.
1218.14 Person.
1218.15 Processed blueberries.
1218.16 Producer.
1218.17 Promotion.
1218.18 Research.
1218.19 Secretary.
1218.20 Suspend.
1218.21 Terminate.
1218.22 United States.
1218.23 USACBC.

                   U.S.A. Cultivated Blueberry Council

1218.40 Establishment and membership.
1218.41 Nominations and appointments.
1218.42 Term of office.
1218.43 Vacancies.
1218.44 Alternate members.
1218.45 Procedure.
1218.46 Compensation and reimbursement.
1218.47 Powers and duties.
1218.48 Prohibited activities.

                        Expenses and Assessments

1218.50 Budget and expenses.
1218.51 Financial statements.
1218.52 Assessments.
1218.53 Exemption procedures.
1218.54 Programs, plans, and projects.
1218.55 Independent evaluation.
1218.56 Patents, copyrights, trademarks, information, publications, and 
          product formulations.

                       Reports, Books, and Records

1218.60 Reports.
1218.61 Books and records.
1218.62 Confidential treatment.

                              Miscellaneous

1218.70 Right of the Secretary.
1218.71 Referenda.
1218.72 Suspension and termination.

[[Page 144]]

1218.73 Proceedings after termination.
1218.74 Effect of termination or amendment.
1218.75 Personal liability.
1218.76 Separability.
1218.77 Amendments.
1218.78 OMB control numbers.

Subpart B_Procedure for the Conduct of Referenda in Connection with the 
          Blueberry Promotion, Research, and Information Order

1218.100 General.
1218.101 Definitions.
1218.102 Voting.
1218.103 Instructions.
1218.104 Subagents.
1218.105 Ballots.
1218.106 Referendum report.
1218.107 Confidential information.

    Authority: U.S.C. 7401--7425.

    Source: 65 FR 7654, Feb. 15, 2000, unless otherwise noted.



     Subpart A_Blueberry Promotion, Research, and Information Order

    Source: 65 FR 43963, July 17, 2000, unless otherwise noted.

    Editorial Note: Nomenclature changes to part 1218 appear at 66 FR 
37118, 37119, July 17, 2001.

                               Definitions



Sec. 1218.1  Act.

    Act means the Commodity Promotion, Research, and Information Act of 
1996 (7 U.S.C. 7401-7425; Pub. L. 104-127; 110 Stat. 1029), or any 
amendments thereto.



Sec. 1218.2  Blueberries.

    Blueberries means cultivated blueberries grown in or imported into 
the United States of the genus Vaccinium Corymbosum and Ashei, including 
the northern highbush, southern highbush, rabbit eye varieties, and any 
hybrid, and excluding the lowbush (native) blueberry Vaccinium 
Angustifolium.



Sec. 1218.3  Conflict of interest.

    Conflict of interest means a situation in which a member or employee 
of the U.S.A. Cultivated Blueberry Council has a direct or indirect 
financial interest in a person who performs a service for, or enters 
into a contract with, the USACBC for anything of economic value.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37118, July 17, 2001]



Sec. 1218.4  Crop year.

    Crop year means the 12-month period from November 1 through October 
31 of the following year or such other period approved by the Secretary.



Sec. 1218.5  Department.

    Department means the U.S. Department of Agriculture.



Sec. 1218.6  Exporter.

    Exporter means a person involved in exporting blueberries from 
another country to the United States.



Sec. 1218.7  First handler.

    First handler means any person, (excluding a common or contract 
carrier), receiving blueberries from producers and who as owner, agent, 
or otherwise ships or causes blueberries to be shipped as specified in 
the Order. This definition includes those engaged in the business of 
buying, selling and/or offering for sale; receiving; packing; grading; 
marketing; or distributing blueberries in commercial quantities. This 
definition includes a retailer, except a retailer who purchases or 
acquires from, or handles on behalf of any producer, blueberries. The 
term first handler includes a producer who handles or markets 
blueberries of the producer's own production.



Sec. 1218.8  Fiscal period.

    Fiscal period means a calendar year from January 1 through December 
31, or such other period as approved by the Secretary.



Sec. 1218.9  Importer.

    Importer means any person who imports fresh or processed blueberries 
into the United States as a principal or as an agent, broker, or 
consignee of any person who produces or handles fresh or processed 
blueberries outside of the United States for sale in the United States, 
and who is listed in the import records as the importer of record for 
such blueberries.

[[Page 145]]



Sec. 1218.10  Information.

    Information means information and programs that are designed to 
increase efficiency in processing and to develop new markets, marketing 
strategies, increase market efficiency, and activities that are designed 
to enhance the image of blueberries on a national or international 
basis. These include:
    (a) Consumer information, which means any action taken to provide 
information to, and broaden the understanding of, the general public 
regarding the consumption, use, nutritional attributes, and care of 
blueberries; and
    (b) Industry information, which means information and programs that 
will lead to the development of new markets, new marketing strategies, 
or increased efficiency for the blueberry industry, and activities to 
enhance the image of the blueberry industry.



Sec. 1218.11  Market or marketing.

    (a) Marketing means the sale or other disposition of blueberries in 
any channel of commerce.
    (b) To market means to sell or otherwise dispose of blueberries in 
interstate, foreign, or intrastate commerce.



Sec. 1218.12  Order.

    Order means an order issued by the Secretary under section 514 of 
the Act that provides for a program of generic promotion, research, and 
information regarding agricultural commodities authorized under the Act.



Sec. 1218.13  Part and subpart.

    Part means the Blueberry Promotion, Research, and Information Order 
and all rules, regulations, and supplemental orders issued pursuant to 
the Act and the Order. The Order shall be a subpart of such part.



Sec. 1218.14  Person.

    Person means any individual, group of individuals, partnership, 
corporation, association, cooperative, or any other legal entity.



Sec. 1218.15  Processed blueberries.

    Processed blueberries means blueberries which have been frozen, 
dried, pureed, or made into juice.



Sec. 1218.16  Producer.

    Producer means any person who grows blueberries in the United States 
for sale in commerce, or a person who is engaged in the business of 
producing, or causing to be produced for any market, blueberries beyond 
the person's own family use and having value at first point of sale.



Sec. 1218.17  Promotion.

    Promotion means any action taken to present a favorable image of 
blueberries to the general public and the food industry for the purpose 
of improving the competitive position of blueberries both in the United 
States and abroad and stimulating the sale of blueberries. This includes 
paid advertising and public relations.



Sec. 1218.18  Research.

    Research means any type of test, study, or analysis designed to 
advance the image, desirability, use, marketability, production, product 
development, or quality of blueberries, including research relating to 
nutritional value, cost of production, new product development, varietal 
development, nutritional value, health research, and marketing of 
blueberries.



Sec. 1218.19  Secretary.

    Secretary means the Secretary of Agriculture of the United States, 
or any officer or employee of the Department to whom authority has 
heretofore been delegated, or to whom authority may hereafter be 
delegated, to act in the Secretary's stead.



Sec. 1218.20  Suspend.

    Suspend means to issue a rule under section 553 of title 5, U.S.C., 
to temporarily prevent the operation of an order or part thereof during 
a particular period of time specified in the rule.



Sec. 1218.21  Terminate.

    Terminate means to issue a rule under section 553 of title 5, 
U.S.C., to cancel permanently the operation of an order or part thereof 
beginning on a date certain specified in the rule.

[[Page 146]]



Sec. 1218.22  United States.

    United States means collectively the 50 states, the District of 
Columbia, the Commonwealth of Puerto Rico, and the territories and 
possessions of the United States.



Sec. 1218.23  USACBC.

    USACBC, or U.S.A. Cultivated Blueberry Council, means the 
administrative body established pursuant to Sec. 1218.40.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37118, July 17, 2001]

                   U.S.A. Cultivated Blueberry Council



Sec. 1218.40  Establishment and membership.

    (a) Establishment of the U.S.A. Cultivated Blueberry Council. There 
is hereby established a U.S.A. Cultivated Blueberry Council, hereinafter 
called the USACBC, composed of no more than 13 members and alternates, 
appointed by the Secretary from the nominations as follows:
    (1) One producer member and alternate from each of the following 
regions:
    (i) Region 1 Western Region (all states from the Pacific 
east to the Rockies): Alaska, Arizona, California, Colorado, Hawaii, 
Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington, and 
Wyoming.
    (ii) Region 2 Midwest Region (all states east of the 
Rockies to the Great Lakes and south to the Kansas/Missouri/Kentucky 
state line): Illinois, Indiana, Iowa, Kansas, Kentucky, Michigan, 
Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota, and 
Wisconsin.
    (iii) Region 3 Northeast Region (all states east of the 
Great Lakes and North of the North Carolina/Tennessee state line): 
Connecticut, Delaware, New York, Maine, Maryland, Massachusetts, New 
Hampshire, New Jersey, Pennsylvania, Rhode Island, Virginia, Vermont, 
Washington, D.C., and West Virginia.
    (iv) Region 4 Southern Region (all states south of the 
Virginia/Kentucky/Missouri/Kansas state line and east of the Rockies): 
Alabama, Arkansas, Florida, Georgia, Louisiana, Mississippi, North 
Carolina, Oklahoma, Puerto Rico, South Carolina, Tennessee, and Texas.
    (2) One producer member and alternate from each of the top five 
blueberry producing states, based upon the average of the total tons 
produced over the previous three years. Average tonnage will be based 
upon North American Blueberry Council production figures for the initial 
election and production and assessment figures generated by the USACBC 
thereafter.
    (3) One importer and alternate.
    (4) One exporter and alternate shall be filled by foreign blueberry 
producers currently shipping blueberries into the United States from the 
largest foreign blueberry production area, based on a three-year 
average.
    (5) One first handler member and alternate shall be filled by a 
United States based independent or cooperative organization which is a 
producer/shipper of domestic blueberries.
    (6) One public member and alternate.
    (b) Adjustment of membership. At least once every five years, the 
USACBC will review the geographical distribution of United States 
production of blueberries and the quantity of imports. The review will 
be conducted through an audit of state crop production figures and 
USACBC assessment receipts. If warranted, the USACBC will recommend to 
the Secretary that membership on the USACBC be altered to reflect any 
changes in geographical distribution of domestic blueberry production 
and the quantity of imports. If the level of imports increases, importer 
members and alternates may be added to the USACBC.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37119, July 17, 2001]



Sec. 1218.41  Nominations and appointments.

    (a) Voting for regional and state representatives will be made by 
mail ballot.
    (b) In a case where a state has a state blueberry commission or 
marketing order in place, the state commission or committee will 
nominate members and alternates to serve on the USACBC. At least two 
nominees shall be submitted to the Secretary for each member and for 
each alternate.

[[Page 147]]

    (c) Nomination and election of regional, and state representatives 
where no commission or order is in place will be handled by the USACBC, 
provided that the initial nominations will be handled by the North 
American Blueberry Council. The USACBC will seek nominations for members 
and alternates from the specific states and/or regions. Nominations will 
be returned to the USACBC and placed on a ballot which will then be sent 
to producers in the state and/or region for vote. The final nominee for 
member will have received the highest number of votes cast. The person 
with the second highest number of votes cast will be the final nominee 
for alternate. The persons with the third and fourth place highest 
number of votes cast will be designated as additional nominees for 
consideration by the Secretary.
    (d) Nominations for the importer, exporter, first handler, and 
public member positions will be made by the USACBC. Two nominees for 
each member and each alternate position will be submitted to the 
Secretary for consideration.
    (e) From the nominations, the Secretary shall select the members of 
the USACBC and alternates for each position on the USACBC.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37119, July 17, 2001]



Sec. 1218.42  Term of office.

    USACBC members and alternates will serve for a term of three years 
and be able to serve a maximum of two consecutive terms. A USACBC member 
may serve as an alternate during the years the member is ineligible for 
a member position. When the USACBC is first established, the state 
representatives, first handler member, and their respected alternates 
will be assigned initial terms of three years. Regional representatives, 
the importer member, the exporter member, public member, and their 
alternates will serve an initial term of two years. Thereafter, each of 
these positions will carry a full three-year term. USACBC nominations 
and appointments will take place in two out of every three years. Each 
term of office will end on December 31, with new terms of office 
beginning on January 1.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37119, July 17, 2001]



Sec. 1218.43  Vacancies.

    (a) In the event that any member of the USACBC ceases to be a member 
of the category of members from which the member was appointed to the 
USACBC, such position shall automatically become vacant.
    (b) If a member of the USACBC consistently refuses to perform the 
duties of a member of the USACBC, or if a member of the USACBC engages 
in acts of dishonesty or willful misconduct, the USACBC may recommend to 
the Secretary that the member be removed from office. If the Secretary 
finds the recommendation of the USACBC shows adequate cause, the 
Secretary shall remove such member from office.
    (c) Should any member position become vacant, the alternate of that 
member shall automatically assume the position of said member. Should 
the positions of both a member and such member's alternate become 
vacant, successors for the unexpired terms of such member and alternate 
shall be appointed in the manner specified in Sec. 1218.40 and Sec. 
1218.41, except that said nomination and replacement shall not be 
required if said unexpired terms are less than six months.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37119, July 17, 2001]



Sec. 1218.44  Alternate members.

    An alternate member of the USACBC, during the absence of the member 
for whom the person is the alternate, shall act in the place and stead 
of such member and perform such duties as assigned. In the event of 
death, removal, resignation, or disqualification of any member, the 
alternate for that member shall automatically assume the position of 
said member. In the event that both a producer member of the USACBC and 
the alternate are unable to attend a meeting, the USACBC may not 
designate any

[[Page 148]]

other alternate to serve in such member's or alternate's place and stead 
for such a meeting.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37119, July 17, 2001]



Sec. 1218.45  Procedure.

    (a) At a USACBC meeting, it will be considered a quorum when a 
minimum of seven members, or their alternates serving in the absence, 
are present.
    (b) At the start of each fiscal period, the USACBC will select a 
chairperson and vice chairperson who will conduct meetings throughout 
that period.
    (c) All USACBC members and alternates will receive a minimum of 10 
days advance notice of all USACBC and committee meetings.
    (d) Each member of the USACBC will be entitled to one vote on any 
matter put to the USACBC, and the motion will carry if supported by one 
vote more than 50 percent of the total votes represented by the USACBC 
members present.
    (e) It will be considered a quorum at a committee meeting when at 
least one more than half of those assigned to the committee are present. 
Alternates may also be assigned to committees as necessary. Committees 
may also consist of individuals other than USACBC members and such 
individuals may vote in committee meetings. These committee members 
shall serve without compensation but shall be reimbursed for reasonable 
travel expenses, as approved by the USACBC.
    (f) In lieu of voting at a properly convened meeting and, when in 
the opinion of the chairperson of the USACBC such action is considered 
necessary, the USACBC may take action if supported by one vote more than 
50 percent of the members by mail, telephone, electronic mail, 
facsimile, or any other means of communication, and all telephone votes 
shall be confirmed promptly in writing. In that event, all members must 
be notified and provided the opportunity to vote. Any action so taken 
shall have the same force and effect as though such action had been 
taken at a properly convened meeting of the USACBC. All votes shall be 
recorded in USACBC minutes.
    (g) There shall be no voting by proxy.
    (h) The chairperson shall be a voting member.
    (i) The organization of the USACBC and the procedures for the 
conducting of meetings of the USACBC shall be in accordance with its 
bylaws, which shall be established by the USACBC and approved by the 
Secretary.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37119, July 17, 2001]



Sec. 1218.46  Compensation and reimbursement.

    The members of the USACBC, and alternates when acting as members, 
shall serve without compensation but shall be reimbursed for reasonable 
travel expenses, as approved by the USACBC, incurred by them in the 
performance of their duties as USACBC members.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37119, July 17, 2001]



Sec. 1218.47  Powers and duties.

    The USACBC shall have the following powers and duties:
    (a) To administer the Order in accordance with its terms and 
conditions and to collect assessments;
    (b) To develop and recommend to the Secretary for approval such 
bylaws as may be necessary for the functioning of the USACBC, and such 
rules as may be necessary to administer the Order, including activities 
authorized to be carried out under the Order;
    (c) To meet, organize, and select from among the members of the 
USACBC a chairperson, other officers, committees, and subcommittees, as 
the USACBC determines to be appropriate;
    (d) To employ persons, other than the members, as the USACBC 
considers necessary to assist the USACBC in carrying out its duties and 
to determine the compensation and specify the duties of such persons;
    (e) To develop programs and projects, and enter into contracts or 
agreements, which must be approved by the Secretary before becoming 
effective, for the development and carrying out of programs or projects 
of research, information, or promotion, and the payment of costs thereof 
with funds collected pursuant to this subpart. Each contract or 
agreement shall provide

[[Page 149]]

that any person who enters into a contract or agreement with the USACBC 
shall develop and submit to the USACBC a proposed activity; keep 
accurate records of all of its transactions relating to the contract or 
agreement; account for funds received and expended in connection with 
the contract or agreement; make periodic reports to the USACBC of 
activities conducted under the contract or agreement; and make such 
other reports available as the USACBC or the Secretary considers 
relevant. Any contract or agreement shall provide that:
    (1) The contractor or agreeing party shall develop and submit to the 
USACBC a program, plan, or project together with a budget or budgets 
that shall show the estimated cost to be incurred for such program, 
plan, or project;
    (2) The contractor or agreeing party shall keep accurate records of 
all its transactions and make periodic reports to the USACBC of 
activities conducted, submit accounting for funds received and expended, 
and make such other reports as the Secretary or the USACBC may require;
    (3) The Secretary may audit the records of the contracting or 
agreeing party periodically; and
    (4) Any subcontractor who enters into a contract with a USACBC 
contractor and who receives or otherwise uses funds allocated by the 
USACBC shall be subject to the same provisions as the contractor.
    (f) To prepare and submit for approval of the Secretary fiscal year 
budgets in accordance with Sec. 1218.50;
    (g) To maintain such records and books and prepare and submit such 
reports and records from time to time to the Secretary as the Secretary 
may prescribe; to make appropriate accounting with respect to the 
receipt and disbursement of all funds entrusted to it; and to keep 
records that accurately reflect the actions and transactions of the 
USACBC;
    (h) To cause its books to be audited by a competent auditor at the 
end of each fiscal year and at such other times as the Secretary may 
request, and to submit a report of the audit directly to the Secretary;
    (i) To give the Secretary the same notice of meetings of the USACBC 
as is given to members in order that the Secretary's representative(s) 
may attend such meetings, and to keep and report minutes of each meeting 
of the USACBC to the Secretary;
    (j) To act as intermediary between the Secretary and any producer, 
first handler, importer, or exporter;
    (k) To furnish to the Secretary any information or records that the 
Secretary may request;
    (l) To receive, investigate, and report to the Secretary complaints 
of violations of the Order;
    (m) To recommend to the Secretary such amendments to the Order as 
the USACBC considers appropriate; and
    (n) To work to achieve an effective, continuous, and coordinated 
program of promotion, research, consumer information, evaluation, and 
industry information designed to strengthen the blueberry industry's 
position in the marketplace; maintain and expand existing markets and 
uses for blueberries; and to carry out programs, plans, and projects 
designed to provide maximum benefits to the blueberry industry.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37119, July 17, 2001]



Sec. 1218.48  Prohibited activities.

    The USACBC may not engage in, and shall prohibit the employees and 
agents of the USACBC from engaging in:
    (a) Any action that would be a conflict of interest; and
    (b) Using funds collected by the USACBC under the Order to undertake 
any action for the purpose of influencing legislation or governmental 
action or policy, by local, state, national, and foreign governments, 
other than recommending to the Secretary amendments to the Order.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37119, July 17, 2001]

                        Expenses and Assessments



Sec. 1218.50  Budget and expenses.

    (a) At least 60 days prior to the beginning of each fiscal year, and 
as may be necessary thereafter, the USACBC

[[Page 150]]

shall prepare and submit to the Secretary a budget for the fiscal year 
covering its anticipated expenses and disbursements in administering 
this subpart. Each such budget shall include:
    (1) A statement of objectives and strategy for each program, plan, 
or project;
    (2) A summary of anticipated revenue, with comparative data or at 
least one preceding year (except for the initial budget);
    (3) A summary of proposed expenditures for each program, plan, or 
project; and
    (4) Staff and administrative expense breakdowns, with comparative 
data for at least on preceding year (except for the initial budget).
    (b) Each budget shall provide adequate funds to defray its proposed 
expenditures and to provide for a reserve as set forth in this subpart.
    (c) Subject to this section, any amendment or addition to an 
approved budget must be approved by the Secretary, including shifting 
funds from one program, plan, or project to another. Shifts of funds 
which do not cause an increase in the USACBC's approved budget and which 
are consistent with governing bylaws need not have prior approval by the 
Secretary.
    (d) The USACBC is authorized to incur such expenses, including 
provision for a reasonable reserve, as the Secretary finds are 
reasonable and likely to be incurred by the USACBC for its maintenance 
and functioning, and to enable it to exercise its powers and perform its 
duties in accordance with the provisions of this subpart. Such expenses 
shall be paid from funds received by the USACBC.
    (e) With approval of the Secretary, the USACBC may borrow money for 
the payment of administrative expenses, subject to the same fiscal, 
budget, and audit controls as other funds of the USACBC. Any funds 
borrowed by the USACBC shall be expended only for startup costs and 
capital outlays and are limited to the first year of operation of the 
USACBC.
    (f) The USACBC may accept voluntary contributions, but these shall 
only be used to pay expenses incurred in the conduct of programs, plans, 
and projects. Such contributions shall be free from any encumbrance by 
the donor and the USACBC shall retain complete control of their use.
    (g) The USACBC may also receive funds provided through the 
Department's Foreign Agricultural Service or from other sources, with 
the approval of the Secretary, for authorized activities.
    (h) The USACBC shall reimburse the Secretary for all expenses 
incurred by the Secretary in the implementation, administration, and 
supervision of the Order, including all referendum costs in connection 
with the Order.
    (i) The USACBC may not expend for administration, maintenance, and 
functioning of the USACBC in any fiscal year an amount that exceeds 15 
percent of the assessments and other income received by the USACBC for 
that fiscal year. Reimbursements to the Secretary required under 
paragraph (h) are excluded from this limitation on spending.
    (j) The USACBC may establish an operating monetary reserve and may 
carry over to subsequent fiscal periods excess funds in any reserve so 
established: Provided that the funds in the reserve do not exceed one 
fiscal period's budget. Subject to approval by the Secretary, such 
reserve funds may be used to defray any expenses authorized under this 
part.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37119, July 17, 2001]



Sec. 1218.51  Financial statements.

    (a) As requested by the Secretary, the USACBC shall prepare and 
submit financial statements to the Secretary on a periodic basis. Each 
such financial statement shall include, but not be limited to, a balance 
sheet, income statement, and expense budget. The expense budget shall 
show expenditures during the time period covered by the report, year-to-
date expenditures, and the unexpended budget.
    (b) Each financial statement shall be submitted to the Secretary 
within 30 days after the end of the time period to which it applies.
    (c) The USACBC shall submit annually to the Secretary an annual 
financial statement within 90 days after the

[[Page 151]]

end of the fiscal year to which it applies.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37119, July 17, 2001]



Sec. 1218.52  Assessments.

    (a) The funds to cover the Council's expenses shall be paid from 
assessments on producers and importers, donations from any person not 
subject to assessments under this Order, and other funds available to 
the Board including those collected pursuant to Sec. 1218.56 and 
subject to the limitations contained therein.
    (b) The collection of assessments on domestic blueberries will be 
the responsibility of the first handler receiving the blueberries. In 
the case of the producer acting as its own first handler, the producer 
will be required to collect and remit its individual assessments.
    (c) Such assessments shall be levied at a rate of $12 per ton on all 
blueberries. The assessment rate will be reviewed, and may be modified 
with the approval of the Secretary, after the first referendum is 
conducted as stated in Sec. 1218.71(b).
    (d) Each importer of fresh and processed blueberries shall pay an 
assessment to the USACBC on blueberries imported for marketing in the 
United States, through the U.S. Customs Service.
    (1) The assessment rate for imported fresh and processed blueberries 
shall be the same or equivalent to the rate for fresh blueberries 
produced in the United States.
    (2) The import assessment shall be uniformly applied to imported 
fresh and frozen blueberries that are identified by the numbers 
0810.40.0028 and 0811.90.2028, respectively, in the Harmonized Tariff 
Schedule of the United States or any other numbers used to identify 
fresh and frozen blueberries. Assessments on other types of imported 
processed blueberries, such as dried blueberries, puree, and juice, may 
be added at the recommendation of the USACBC with the approval of the 
Secretary.
    (3) The assessments due on imported fresh and processed blueberries 
shall be paid when they enter or are withdrawn for consumption in the 
United States.
    (e) All assessment payments and reports will be submitted to the 
office of the USACBC. All final payments for a crop year are to be 
received no later than November 30 of that year. A late payment charge 
shall be imposed on any handler who fails to remit to the USACBC, the 
total amount for which any such handler is liable on or before the due 
date established by the USACBC. In addition to the late payment charge, 
an interest charge shall be imposed on the outstanding amount for which 
the handler is liable. The rate of interest shall be prescribed in 
regulations issued by the Secretary.
    (f) Persons failing to remit total assessments due in a timely 
manner may also be subject to actions under federal debt collection 
procedures.
    (g) The USACBC may authorize other organizations to collect 
assessments on its behalf with the approval of the Secretary.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37119, July 17, 2001]



Sec. 1218.53  Exemption procedures.

    (a) Any producer who produces less than 2,000 pounds of blueberries 
annually who desires to claim an exemption from assessments during a 
fiscal year as provided in Sec. 1218.42 shall apply to the USACBC, on a 
form provided by the USACBC, for a certificate of exemption. Such 
producer shall certify that the producer's production of blueberries 
shall be less than 2,000 pounds for the fiscal year for which the 
exemption is claimed. Any importer who imports less than 2,000 pounds of 
fresh and processed blueberries annually who desires to claim an 
exemption from assessments during a fiscal year as provided in Sec. 
1218.52 shall apply to the USACBC, on a form provided by the USACBC, for 
a certificate of exemption. Such importer shall certify that the 
importer's importation of fresh and processed blueberries shall not 
exceed 2,000 pounds, for the fiscal year for which the exemption is 
claimed.
    (b) On receipt of an application, the USACBC shall determine whether 
an exemption may be granted. The USACBC then will issue, if deemed 
appropriate, a certificate of exemption to each person who is eligible 
to receive one. Each producer who is exempt from

[[Page 152]]

assessment must provide an exemption number to the first handler in 
order to be exempt from the collection of an assessment on blueberries. 
First handlers and importers, except as otherwise authorized by the 
USACBC, shall maintain records showing the exemptee's name and address 
along with the exemption number assigned by the USACBC.
    (c) Importers who are exempt from assessment shall be eligible for 
reimbursement of assessments collected by the U.S. Customs Service and 
shall apply to the USACBC for reimbursement of such assessments paid. No 
interest will be paid on assessments collected by the U.S. Customs 
Service. Requests for reimbursement shall be submitted to the USACBC 
within 90 days of the last day of the year the blueberries were actually 
imported.
    (d) Any person who desires an exemption from assessments for a 
subsequent fiscal year shall reapply to the USACBC, on a form provided 
by the USACBC, for a certificate of exemption.
    (e) The USACBC may require persons receiving an exemption from 
assessments to provide to the USACBC reports on the disposition of 
exempt blueberries and, in the case of importers, proof of payment of 
assessments.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37119, July 17, 2001]



Sec. 1218.54  Programs, plans, and projects.

    (a) The USACBC shall receive and evaluate, or on its own initiative 
develop, and submit to the Secretary for approval any program, plan, or 
project authorized under this subpart. Such programs, plans, or projects 
shall provide for:
    (1) The establishment, issuance, effectuation, and administration of 
appropriate programs for promotion, research, and information, including 
producer and consumer information, with respect to fresh and processed 
blueberries; and
    (2) The establishment and conduct of research with respect to the 
use, nutritional value, sale, distribution, and marketing of fresh and 
processed blueberries, and the creation of new products thereof, to the 
end that the marketing and use of blueberries may be encouraged, 
expanded, improved, or made more acceptable and to advance the image, 
desirability, or quality of fresh and processed blueberries.
    (b) No program, plan, or project shall be implemented prior to its 
approval by the Secretary. Once a program, plan, or project is so 
approved, the USACBC shall take appropriate steps to implement it.
    (c) Each program, plan, or project implemented under this subpart 
shall be reviewed or evaluated periodically by the USACBC to ensure that 
it contributes to an effective program of promotion, research, or 
information. If it is found by the USACBC that any such program, plan, 
or project does not contribute to an effective program of promotion, 
research, or information, then the USACBC shall terminate such program, 
plan, or project.
    (d) No program, plan, or project including advertising shall be 
false or misleading or disparaging another agricultural commodity. 
Blueberries of all origins shall be treated equally.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37119, July 17, 2001]



Sec. 1218.55  Independent evaluation.

    The USACBC shall, not less often than every five years, authorize 
and fund, from funds otherwise available to the USACBC, an independent 
evaluation of the effectiveness of the Order and other programs 
conducted by the USACBC pursuant to the Act. The USACBC shall submit to 
the Secretary, and make available to the public, the results of each 
periodic independent evaluation conducted under this paragraph.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37119, July 17, 2001]



Sec. 1218.56  Patents, copyrights, trademarks, information, publications, 
and product formulations.

    Patents, copyrights, trademarks, information, publications, and 
product formulations developed through the use of funds received by the 
USACBC under this subpart shall be the property of the U.S. Government 
as represented by the USACBC and shall, along with any rents, royalties, 
residual payments, or other income from

[[Page 153]]

the rental, sales, leasing, franchising, or other uses of such patents, 
copyrights, trademarks, information, publications, or product 
formulations, inure to the benefit of the USACBC; shall be considered 
income subject to the same fiscal, budget, and audit controls as other 
funds of the USACBC; and may be licensed subject to approval by the 
Secretary. Upon termination of this subpart, Sec. 1218.73 shall apply 
to determine disposition of all such property.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37119, July 17, 2001]

                       Reports, Books, and Records



Sec. 1218.60  Reports.

    (a) Each first handler subject to this subpart may be required to 
provide to the USACBC periodically such information as may be required 
by the USACBC, with the approval of the Secretary, which may include but 
not be limited to the following:
    (1) Number of pounds handled;
    (2) Number of pounds on which an assessment was collected;
    (3) Name and address of person from whom the first handler has 
collected the assessments on each pound handled; and
    (4) Date collection was made on each pound handled. All reports are 
due to the USACBC 30 days after the end of the crop year.
    (b) Each producer and importer subject to this subpart may be 
required to provide to the USACBC periodically such information as may 
be required by the USACBC, with the approval of the Secretary, which may 
include but not be limited to the following:
    (1) Number of pounds produced;
    (2) Number of pounds on which an assessment was paid;
    (3) Name and address of the producer;
    (4) Date collection was made on each pound produced. All reports are 
due to the USACBC 30 days after the end of the crop year.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37119, July 17, 2001]



Sec. 1218.61  Books and records.

    Each first handler, producer, and importer subject to this subpart 
shall maintain and make available for inspection by the Secretary such 
books and records as are necessary to carry out the provisions of this 
subpart and the regulations issued thereunder, including such records as 
are necessary to verify any reports required. Such records shall be 
retained for at least 2 years beyond the fiscal period of their 
applicability.



Sec. 1218.62  Confidential treatment.

    All information obtained from books, records, or reports under the 
Act, this subpart, and the regulations issued thereunder shall be kept 
confidential by all persons, including all employees and former 
employees of the USACBC, all officers and employees and former officers 
and employees of contracting and subcontracting agencies or agreeing 
parties having access to such information. Such information shall not be 
available to USACBC members, producers, importers, exporters, or first 
handlers. Only those persons having a specific need for such information 
to effectively administer the provisions of this subpart shall have 
access to such information. Only such information so obtained as the 
Secretary deems relevant shall be disclosed by them, and then only in a 
judicial proceeding or administrative hearing brought at the direction, 
or on the request, of the Secretary, or to which the Secretary or any 
officer of the United States is a party, and involving this subpart. 
Nothing in this section shall be deemed to prohibit:
    (a) The issuance of general statements based upon the reports of the 
number of persons subject to this subpart or statistical data collected 
therefrom, which statements do not identify the information furnished by 
any person; and
    (b) The publication, by direction of the Secretary, of the name of 
any person who has been adjudged to have violated this subpart, together 
with a statement of the particular provisions of this subpart violated 
by such person.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37119, July 17, 2001]

[[Page 154]]

                              Miscellaneous



Sec. 1218.70  Right of the Secretary.

    All fiscal matters, programs, plans, or projects, rules or 
regulations, reports, or other substantive actions proposed and prepared 
by the USACBC shall be submitted to the Secretary for approval.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37119, July 17, 2001]



Sec. 1218.71  Referenda.

    (a) Initial referendum. The Order shall not become effective unless:
    (1) The Secretary determines that the Order is consistent with and 
will effectuate the purposes of the Act; and
    (2) The Order is approved by a majority of producers and importers 
voting for approval who also represent a majority of the volume of 
blueberries represented in the referendum who, during a representative 
period determined by the Secretary, have been engaged in the production 
or importation of blueberries.
    (b) Subsequent referenda. Every five years, the Secretary shall hold 
a referendum to determine whether blueberry producers and importers 
favor the continuation of the Order. The Order shall continue if it is 
favored by a majority of producers and importers voting for approval who 
also represent a majority of the volume of blueberries represented in 
the referendum who, during a representative period determined by the 
Secretary, have been engaged in the production or importation of 
blueberries. The Secretary will also conduct a referendum if 10 percent 
or more of all eligible blueberry producers and importers request the 
Secretary to hold a referendum. In addition, the Secretary may hold a 
referendum at any time.



Sec. 1218.72  Suspension and termination.

    (a) The Secretary shall suspend or terminate this part or subpart or 
a provision thereof if the Secretary finds that the subpart or a 
provision thereof obstructs or does not tend to effectuate the purposes 
of the Act, or if the Secretary determines that this subpart or a 
provision thereof is not favored by persons voting in a referendum 
conducted pursuant to the Act.
    (b) The Secretary shall suspend or terminate this subpart at the end 
of the marketing year whenever the Secretary determines that its 
suspension or termination is approved or favored by a majority of 
producers and importers voting for approval who also represent a 
majority of the volume of blueberries represented in the referendum who, 
during a representative period determined by the Secretary, have been 
engaged in the production or importation of blueberries.
    (c) If, as a result of a referendum the Secretary determines that 
this subpart is not approved, the Secretary shall:
    (1) Not later than 180 days after making the determination, suspend 
or terminate, as the case may be, collection of assessments under this 
subpart; and
    (2) As soon as practical, suspend or terminate, as the case may be, 
activities under this subpart in an orderly manner.



Sec. 1218.73  Proceedings after termination.

    (a) Upon the termination of this subpart, the USACBC shall recommend 
not more than three of its members to the Secretary to serve as trustees 
for the purpose of liquidating the affairs of the USACBC. Such persons, 
upon designation by the Secretary, shall become trustees of all of the 
funds and property then in the possession or under control of the 
USACBC, including claims for any funds unpaid or property not delivered, 
or any other claim existing at the time of such termination.
    (b) The said trustees shall:
    (1) Continue in such capacity until discharged by the Secretary;
    (2) Carry out the obligations of the USACBC under any contracts or 
agreements entered into pursuant to the Order;
    (3) From time to time account for all receipts and disbursements and 
deliver all property on hand, together with all books and records of the 
USACBC and the trustees, to such person or persons as the Secretary may 
direct; and
    (4) Upon request of the Secretary execute such assignments or other 
instruments necessary and appropriate to vest in such persons title and 
right to all funds, property and claims vested in

[[Page 155]]

the USACBC or the trustees pursuant to the Order.
    (c) Any person to whom funds, property or claims have been 
transferred or delivered pursuant to the Order shall be subject to the 
same obligations imposed upon the USACBC and upon the trustees.
    (d) Any residual funds not required to defray the necessary expenses 
of liquidation shall be turned over to the Secretary to be disposed of, 
to the extent practical, to the blueberry producer organizations in the 
interest of continuing blueberry promotion, research, and information 
programs.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37119, July 17, 2001]



Sec. 1218.74  Effect of termination or amendment.

    Unless otherwise expressly provided by the Secretary, the 
termination of this subpart or of any regulation issued pursuant 
thereto, or the issuance of any amendment to either thereof, shall not:
    (a) Affect or waive any right, duty, obligation or liability which 
shall have arisen or which may thereafter arise in connection with any 
provision of this subpart or any regulation issued thereunder; or
    (b) Release or extinguish any violation of this subpart or any 
regulation issued thereunder; or
    (c) Affect or impair any rights or remedies of the United States, or 
of the Secretary or of any other persons, with respect to any such 
violation.



Sec. 1218.75  Personal liability.

    No member, alternate member, or employee of the USACBC shall be held 
personally responsible, either individually or jointly with others, in 
any way whatsoever, to any person for errors in judgment, mistakes, or 
other acts, either of commission or omission, as such member, alternate, 
or employee, except for acts of dishonesty or willful misconduct.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37119, July 17, 2001]



Sec. 1218.76  Separability.

    If any provision of this subpart is declared invalid or the 
applicability thereof to any person or circumstances is held invalid, 
the validity of the remainder of this subpart or the applicability 
thereof to other persons or circumstances shall not be affected thereby.



Sec. 1218.77  Amendments.

    Amendments to this subpart may be proposed from time to time by the 
USACBC or by any interested person affected by the provisions of the 
Act, including the Secretary.

[65 FR 43963, July 17, 2000, as amended at 66 FR 37119, July 17, 2001]



Sec. 1218.78  OMB control numbers.

    The control number assigned to the information collection 
requirements by the Office of Management and Budget pursuant to the 
Paperwork Reduction Act of 1995, 44 U.S.C. Chapter 35, is OMB control 
number 0581-0093, except for the USABC nominee background statement form 
which is assigned OMB control number 0505-001.



Subpart B_Procedure for the Conduct of Referenda in Connection with the 
          Blueberry Promotion, Research, and Information Order



Sec. 1218.100  General.

    Referenda to determine whether eligible blueberry producers and 
importers favor the issuance, amendment, suspension, or termination of 
the Blueberry Promotion, Research, and Information Order shall be 
conducted in accordance with this subpart.



Sec. 1218.101  Definitions.

    (a) Administrator means the Administrator of the Agricultural 
Marketing Service, with power to redelegate, or any officer or employee 
of the U.S. Department of Agriculture to whom authority has been 
delegated or may hereafter be delegated to act in the Administrator's 
stead.
    (b) Blueberries means cultivated blueberries grown in or imported 
into the United States of the genus Vaccinium Corymbosum and Ashei, 
including the northern highbush, southern highbush, rabbit eye 
varieties, and any hybrid,

[[Page 156]]

and excluding the lowbush (native) blueberry Vaccinium Angustifolium.
    (c) Eligible importer means any person who imported 2,000 pounds or 
more of fresh or processed blueberries, that are identified by the 
numbers 0810.40.0028 and 0811.90.2028, respectively, in the Harmonized 
Tariff Schedule of the United States or any other numbers used to 
identify fresh and frozen blueberries. Importation occurs when 
commodities originating outside the United States are entered or 
withdrawn from the U.S. Customs Service for consumption in the United 
States. Included are persons who hold title to foreign-produced 
blueberries immediately upon release by the U.S. Customs Service, as 
well as any persons who act on behalf of others, as agents or brokers, 
to secure the release of blueberries from the U.S. Customs Service when 
such blueberries are entered or withdrawn for consumption in the United 
States.
    (d) Eligible producer means any person who produced 2,000 pounds or 
more of blueberries in the United States during the representative 
period who:
    (1) Owns, or shares the ownership and risk of loss of, the crop;
    (2) Rents blueberry production facilities and equipment resulting in 
the ownership of all or a portion of the blueberries produced;
    (3) Owns blueberry production facilities and equipment but does not 
manage them and, as compensation, obtains the ownership of a portion of 
the blueberries produced; or
    (4) Is a party in a landlord-tenant relationship or a divided 
ownership arrangement involving totally independent entities cooperating 
only to produce blueberries who share the risk of loss and receive a 
share of the blueberries produced. No other acquisition of legal title 
to blueberries shall be deemed to result in persons becoming eligible 
producers.
    (e) Order means the Blueberry Promotion, Research, and Information 
Order.
    (f) Person means any individual, group of individuals, partnership, 
corporation, association, cooperative, or any other legal entity. For 
the purpose of this definition, the term ``partnership'' includes, but 
is not limited to:
    (1) A husband and a wife who have title to, or leasehold interest 
in, a blueberry farm as tenants in common, joint tenants, tenants by the 
entirety, or, under community property laws, as community property; and
    (2) So-called ``joint ventures'' wherein one or more parties to an 
agreement, informal or otherwise, contributed land and others 
contributed capital, labor, management, or other services, or any 
variation of such contributions by two or more parties.
    (g) Processed blueberries means blueberries which have been frozen, 
dried, pureed, or made into juice.
    (h) Referendum agent or agent means the individual or individuals 
designated by the Secretary to conduct the referendum.
    (i) Representative period means the period designated by the 
Secretary.
    (j) United States means collectively the 50 states, the District of 
Columbia, the Commonwealth of Puerto Rico, and the territories and 
possessions of the United States.



Sec. 1218.102  Voting.

    (a) Each person who is an eligible producer or an eligible importer, 
as defined in this subpart, at the time of the referendum and during the 
representative period, shall be entitled to cast only one ballot in the 
referendum. However, each producer in a landlord-tenant relationship or 
a divided ownership arrangement involving totally independent entities 
cooperating only to produce blueberries, in which more than one of the 
parties is a producer, shall be entitled to cast one ballot in the 
referendum covering only such producer's share of the ownership.
    (b) Proxy voting is not authorized, but an officer or employee of an 
eligible corporate producer or importer, or an administrator, executor, 
or trustee or an eligible entity may cast a ballot on behalf of such 
entity. Any individual so voting in a referendum shall certify that such 
individual is an officer or employee of the eligible entity, or an 
administrator, executive, or trustee of an eligible entity and that such 
individual has the authority to take such action. Upon request of the 
referendum agent, the individual shall

[[Page 157]]

submit adequate evidence of such authority.
    (c) All ballots are to be cast by mail or by facsimile, as 
instructed by the Secretary.



Sec. 1218.103  Instructions.

    The referendum agent shall conduct the referendum, in the manner 
herein provided, under the supervision of the Administrator. The 
Administrator may prescribe additional instructions, not inconsistent 
with the provisions hereof, to govern the procedure to be followed by 
the referendum agent. Such agent shall:
    (a) Determine the period during which ballots may be cast.
    (b) Provide ballots and related material to be used in the 
referendum. The ballot shall provide for recording essential 
information, including that needed for ascertaining whether the person 
voting, or on whose behalf the vote is cast, is an eligible voter.
    (c) Give reasonable public notice of the referendum:
    (1) By utilizing available media or public information sources, 
without incurring advertising expense, to publicize the dates, places, 
method of voting, eligibility requirements, and other pertinent 
information. Such sources of publicity may include, but are not limited 
to, print and radio; and
    (2) By such other means as the agent may deem advisable.
    (d) Mail to eligible producers and importers whose names and 
addresses are known to the referendum agent, the instructions on voting, 
a ballot, and a summary of the terms and conditions of the proposed 
Order. No person who claims to be eligible to vote shall be refused a 
ballot.
    (e) At the end of the voting period, collect, open, number, and 
review the ballots and tabulate the results in the presence of an agent 
of a third party authorized to monitor the referendum process.
    (f) Prepare a report on the referendum.
    (g) Announce the results to the public.



Sec. 1218.104  Subagents.

    The referendum agent may appoint any individual or individuals 
necessary or desirable to assist the agent in performing such agent's 
functions hereunder. Each individual so appointed may be authorized by 
the agent to perform any or all of the functions which, in the absence 
of such appointment, shall be performed by the agent.



Sec. 1218.105  Ballots.

    The referendum agent and subagents shall accept all ballots cast. 
However, if an agent or subagent deems that a ballot should be 
challenged for any reason, the agent or subagent shall endorse above 
their signature, on the ballot, a statement to the effect that such 
ballot was challenged, by whom challenged, the reasons therefore, the 
results of any investigations made with respect thereto, and the 
disposition thereof. Ballots invalid under this subpart shall not be 
counted.



Sec. 1218.106  Referendum report.

    Except as otherwise directed, the referendum agent shall prepare and 
submit to the Administrator a report on the results of the referendum, 
the manner in which it was conducted, the extent and kind of public 
notice given, and other information pertinent to the analysis of the 
referendum and its results.



Sec. 1218.107  Confidential information.

    The ballots and other information or reports that reveal, or tend to 
reveal, the vote of any person covered under the Act and the voting list 
shall be held confidential and shall not be disclosed.



 PART 1219_HASS AVOCADO PROMOTION, RESEARCH, AND INFORMATION--Table 
 of Contents




    Subpart A_Hass Avocado Promotion, Research, and Information Order

                               Definitions

Sec.
1219.1 Act.
1219.2 Association.
1219.3 Conflict of interest.
1219.4 Consumer information.
1219.5 Crop year.
1219.6 Customs.
1219.7 Department.
1219.8 Exempt handler.
1219.9 First handler.

[[Page 158]]

1219.10 Fiscal period or marketing year.
1219.11 Handle.
1219.12 Hass avocado.
1219.13 Hass Avocado Board.
1219.14 Importer.
1219.15 Industry information.
1219.16 Marketing.
1219.17 Order.
1219.18 Part and subpart.
1219.19 Person.
1219.20 Producer.
1219.21 Programs, plans, and projects.
1219.22 Promotion.
1219.23 Research.
1219.24 Secretary.
1219.25 State.
1219.26 United States.

                         The Hass Avocado Board

1219.30 Establishment and membership.
1219.31 Initial nomination and appointment of producer members and 
          alternates.
1219.32 Initial nomination and appointment of importer members and 
          alternates.
1219.33 Subsequent nomination and appointment of Board members and 
          alternates.
1219.34 Failure to nominate.
1219.35 Term of office.
1219.36 Vacancies.
1219.37 Alternate members.
1219.38 Powers and duties.
1219.39 Board procedure.
1219.40 Committee procedure.
1219.41 Compensation and expenses.
1219.42 Prohibited activities.

                   Budgets, Expenses, and Assessments

1219.50 Budgets, programs, plans, and projects.
1219.51 Contracts and agreements.
1219.52 Control of administrative costs.
1219.53 Budget and expenses.
1219.54 Assessments.
1219.55 Exemption from assessment.
1219.56 Adjustment of accounts.
1219.57 Patents, copyrights, trademarks, publications, and product 
          formulations.
1219.58 Importer associations.

                       Books, Records, and Reports

1219.60 Reports.
1219.61 Books and records.
1219.62 Books and records of the Board.
1219.63 Confidential treatment.
1219.64 List of importers.
1219.65 List of producers.

                              Miscellaneous

1219.70 Right of the Secretary.
1219.71 Suspension or termination.
1210.72 Proceedings after termination.
1219.73 Effect of termination or amendment.
1219.74 Personal liability.
1219.75 Separability.
1219.76 Amendments.
1219.77 OMB control numbers.

                     Subpart B_Referendum Procedures

1219.100 General.
1219.101 Definitions.
1219.102 Registration.
1219.103 Voting.
1219.104 Instructions.
1219.105 Subagents.
1219.106 Ballots.
1219.107 Referendum report.
1219.108 Confidential information.
1219.109 OMB control number.

    Authority: 7 U.S.C. 7801-7813.

    Source: 67 FR 7264, Feb. 19, 2002, unless otherwise noted.



    Subpart A_Hass Avocado Promotion, Research, and Information Order

    Source: 67 FR 56897, Sept. 6, 2002, unless otherwise noted.

                               Definitions



Sec. 1219.1  Act.

    Act means the Hass Avocado Promotion, Research, and Information Act 
of 2000, Public Law 106-387, 7 U.S.C. 7801-7813, and any amendments 
thereto.



Sec. 1219.2  Association.

    Association means an avocado organization established by State 
statute in a State with the majority of Hass avocado production in the 
United States.



Sec. 1219.3  Conflict of interest.

    Conflict of interest means a situation in which a Board member or 
employee has a direct or indirect financial interest in a person who 
performs a service for, or enters into a contract with, the Board for 
anything of economic value.



Sec. 1219.4  Consumer information.

    Consumer information means any action or program that disseminates 
or otherwise provides information to consumers and other persons, on the 
use, nutritional attributes, and other information that will assist 
consumers and other persons in the United States in making evaluations 
and decisions regarding the purchase, preparation, and use of Hass 
avocados.

[[Page 159]]



Sec. 1219.5  Crop year.

    Crop year means the period from November 1 of one year through 
October 31 of the following year, or such other one-year period 
recommended by the Board and approved by the Secretary.



Sec. 1219.6  Customs.

    Customs means the United States Customs Service.



Sec. 1219.7  Department.

    Department means the United States Department of Agriculture.



Sec. 1219.8  Exempt handler.

    Exempt handler means a person who would otherwise be considered a 
first handler, except that all Hass avocados purchased by the person 
have already been subject to assessments under the Order. A person who 
handles both Hass avocados that have already been subject to assessments 
under the Order and Hass avocados that have not been subject to 
assessments under the Order is a first handler.



Sec. 1219.9  First handler.

    First handler means a person operating in the Hass avocado marketing 
system that sells domestic or imported Hass avocados for consumption in 
the United States and who is responsible for remitting assessments to 
the Board. For the purposes of the Order, the term means the first 
person who handles Hass avocados for sale (except a common or contract 
carrier of Hass avocados owned by another person), including a producer 
who handles Hass avocados for sale of the producer's own production.



Sec. 1219.10  Fiscal period or marketing year.

    Fiscal period or marketing year means the period beginning on 
November 1 of any year and extending through the last day of October of 
the following year, or such other consecutive 12-month period as shall 
be recommended by the Board and approved by the Secretary.



Sec. 1219.11  Handle.

    Handle means to pack, process, transport, purchase, or in any other 
way to place or cause Hass avocados to which one has title or possession 
to be placed in the current of commerce. Such term shall not include the 
transportation or delivery of Hass avocados by the producer thereof to a 
handler.



Sec. 1219.12  Hass avocado.

    Hass avocado means the fruit grown in or imported into the United 
States of the species Persea americana Mill., or other type of avocados 
that, in the determination of the Board, with approval of the Secretary, 
is so similar to the Hass variety avocado as to be indistinguishable to 
consumers in fresh form. The term shall include all fruit in fresh, 
frozen, or any other processed form.



Sec. 1219.13  Hass Avocado Board.

    Hass Avocado Board or the Board means the administrative body 
established pursuant to Sec. 1219.40.



Sec. 1219.14  Importer.

    Importer means any person who imports Hass avocados into the United 
States. The term includes a person who holds title to Hass avocados 
produced outside of the United States immediately upon release by 
Customs, as well as any person who acts on behalf of others, as an 
agent, broker, or consignee, to secure the release of Hass avocados from 
Customs and the introduction of the released Hass avocados into the 
current of commerce and who is listed in the import records of Customs 
as the importer of record for such Hass avocados.



Sec. 1219.15  Industry information.

    Industry information means information, programs, and activities 
that are designed to increase efficiency in processing, enhance the 
development of new markets and marketing strategies, increase marketing 
efficiency, and enhance the image of Hass avocados and the Hass avocado 
industry in the United States.



Sec. 1219.16  Marketing.

    Marketing means any activity related to the sale or other 
disposition of Hass avocados in any channel of commerce.

[[Page 160]]



Sec. 1219.17  Order.

    Order means this subpart.



Sec. 1219.18  Part and subpart.

    Part means the Order and all rules, regulations, and supplemental 
orders issued pursuant to the Act and the Order. The Order itself shall 
be a subpart of such part.



Sec. 1219.19  Person.

    Person means any individual, group of individuals, firm, 
partnership, corporation, joint stock company, association, cooperative, 
or any other legal entity.



Sec. 1219.20  Producer.

    Producer means any person who is engaged in the business of 
producing Hass avocados in the United States for commercial use, who 
owns, or shares the ownership and risk of loss, of such Hass avocados.



Sec. 1219.21  Programs, plans, and projects.

    Programs, plans, and projects means those research, promotion, and 
information programs, plans, studies, or projects established pursuant 
to Sec. 1219.50.



Sec. 1219.22  Promotion.

    Promotion means any action to advance the image, desirability, or 
marketability of Hass avocados in the United States, including paid 
advertising, sales promotion, and publicity. Promotion activities are 
designed to improve the competitive position and stimulate sales of Hass 
avocados in the domestic marketplace.



Sec. 1219.23  Research.

    Research means any type of test, study, or analysis relating to 
market research, market development, and market efforts, or relating to 
the use, quality, or nutritional value of Hass avocados, other related 
food science research, or research designed to advance the knowledge, 
image, desirability, usage, or marketability of Hass avocados in the 
United States.



Sec. 1219.24  Secretary.

    Secretary means the Secretary of Agriculture of the United States or 
any other officer or employee of the Department to whom authority has 
heretofore been delegated, or to whom authority may hereafter be 
delegated, to act in the Secretary's stead.



Sec. 1219.25  State.

    State means any of the several 50 States of the United States, the 
District of Columbia, the Commonwealth of Puerto Rico, the Commonwealth 
of the Northern Mariana Islands, the United States Virgin Islands, Guam, 
American Samoa, the Republic of the Marshall Islands, and the Federated 
States of Micronesia.



Sec. 1219.26  United States.

    United States means collectively the several 50 States of the United 
States, the District of Columbia, the Commonwealth of Puerto Rico, the 
Commonwealth of the Northern Mariana Islands, the United States Virgin 
Islands, Guam, American Samoa, the Republic of the Marshall Islands, and 
the Federated States of Micronesia.

                         The Hass Avocado Board



Sec. 1219.30  Establishment and membership.

    (a) A Hass Avocado Board, called the Board elsewhere in this part, 
is hereby established to administer the terms and provisions of this 
subpart. The Board shall consist of 12 members nominated by the Hass 
avocado industry and appointed by the Secretary as provided in this 
subpart, each of whom shall have an alternate nominated and appointed in 
the same manner as members of the Board are nominated and appointed. 
Board members and alternates shall be domiciled in the United States.
    (b) The membership of the Board shall be divided as follows:
    (1) Seven members and their alternates shall be producers of Hass 
avocados that are subject to assessments under this subpart;
    (2) Two members and their alternates shall be importers of Hass 
avocados that are subject to assessments under this subpart; and

[[Page 161]]

    (3) Three members shall be producers of Hass avocados that are 
subject to assessments under this subpart or importers of Hass avocados 
that are subject to assessments under this subpart. Producers and 
importers shall be allocated to these positions so as to assure as 
nearly as possible that the composition of the 12-member Board reflects 
the proportion of domestic production and imports supplying the United 
States market. Such proportion shall be based on the Secretary's 
determination of the average volume of domestic production and the 
average volume of imports into the United States market over the 
previous three years, based on all information available to the 
Secretary.
    (c) Three years after the assessment of funds commences pursuant to 
this subpart, and at the end of each three-year period thereafter, the 
Board shall review the production of domestic Hass avocados in the 
United States and the volume of imported Hass avocados on the basis of 
the amount of assessments collected from producers and importers over 
the immediately preceding three-year period and, if warranted, recommend 
to the Secretary the reapportionment of the positions authorized in 
paragraph (b)(3) of this section to reflect changes in the proportion of 
domestic Hass avocado production to the volume of imported Hass 
avocados, to the extent possible in the Act. Any adjustment under this 
paragraph shall be subject to the review and approval of the Secretary.
    (d) For purposes of this section, importer means a person who is 
involved in, as a substantial activity, the importation of Hass avocados 
for sale or marketing in the United States (either directly or as an 
agent, broker, or consignee of any person that produces Hass avocados 
outside of the United States for sale in the United States), who is 
subject to assessments under the Order, and who is listed by Customs as 
the importer of record for such Hass avocados. A substantial activity 
means that the volume of a person's Hass avocado imports must exceed the 
volume of the person's production or handling of domestic Hass avocados.



Sec. 1219.31  Initial nomination and appointment of producer members 
and alternates.

    (a) The Association will nominate producer members and alternates to 
serve on the Board in accordance with the following procedures.
    (1) The Association shall establish a list of producers in the 
United States who are eligible to serve on the Board and notify all 
producers that they may nominate persons to serve as members and 
alternates on the Board.
    (2) After names are received from the producers, the Association 
shall prepare a ballot with the names of all persons nominated and mail 
it to all producers to allow them the opportunity to vote for the 
persons who will represent their interests on the Board.
    (3) After tabulating the vote, the Association shall announce the 
results and submit two names for each producer member and two names for 
each alternate producer member to the Secretary from the persons 
receiving the highest number of votes.
    (b) The Secretary shall select the producer members and alternates 
of the Board from the names submitted by the Association. Following the 
selection of the producer members, the Secretary shall select the 
alternate producer members. In selecting the alternate members, the 
Secretary shall consider the names submitted by the Association for each 
alternate member position along with the individuals whose names were 
submitted by the Association for each Board member position but were not 
selected for that position.



Sec. 1219.32  Initial nomination and appointment of importer members 
and alternates.

    (a) The Department will conduct the nomination process for the 
initial importer members and alternates on the Board in accordance with 
the following procedures.
    (1) The Department shall notify all known importers and importer 
organizations that they may nominate persons to serve as importer 
members and alternates on the Board.
    (2) After names are received from the importers and importer 
organizations, the Department shall prepare a ballot

[[Page 162]]

with the names of all persons nominated and mail it to all known 
importers to allow them the opportunity to vote for the persons who will 
represent their interests on the Board.
    (3) After tabulating the vote, the Department shall announce the 
results and submit two names for each importer member and two names for 
each alternate importer member to the Secretary from the persons 
receiving the highest number of votes.
    (b) The Secretary shall select the importer members and alternates 
of the Board from the nominees elected by importers. Following the 
selection of the importer members, the Secretary shall select the 
alternate importer members. In selecting the alternate members, the 
Secretary shall consider the names for each alternate member position 
along with the individuals who were elected by importers for each Board 
member position but were not selected for that position.



Sec. 1219.33  Subsequent nomination and appointment of Board members 
and alternates.

    The Board's staff shall announce at least 150 days in advance of the 
expiration of members' and alternates' terms that such terms are 
expiring and shall solicit nominations in accordance with procedures 
recommended by the Board and approved by the Secretary. Nominations for 
such positions should be submitted to the Secretary no less than 90 days 
prior to the expiration of the terms.



Sec. 1219.34  Failure to nominate.

    In any case in which producers or importers fail to nominate 
individuals for appointment to the Board, the Secretary may appoint 
individuals to fill vacancies from the appropriate segments of the 
industry.



Sec. 1219.35  Term of office.

    The members and alternate members of the Board shall serve for terms 
of three years, except the members of the initial Board shall serve 
terms as follows: Four members and four alternates shall serve for two-
year terms; four members and four alternates shall serve for three-year 
terms; and four members and four alternates shall serve for four-year 
terms. No member shall serve more than two consecutive three-year terms. 
Members and alternates serving initial two-year or four-year terms may 
serve for one additional three-year term. A Board member may serve as an 
alternate during the years the member is ineligible for a member 
position. Each term of office will end on October 31, with new terms of 
office beginning on November 1.



Sec. 1219.36  Vacancies.

    (a) In the event any member or alternate of the Board ceases to be a 
member of the category of members from which the member was appointed to 
the Board, such member or alternate shall be disqualified from serving 
on the Board and the position shall automatically become vacant.
    (b) If a member of the Board consistently refuses to perform the 
duties of a member of the Board, or if a member of the Board engages in 
acts of dishonesty or willful misconduct, the Board may recommend to the 
Secretary that the member be removed from office. If the Secretary finds 
that the recommendation of the Board shows adequate cause, the member 
shall be removed from office.
    (c) Should any Board member position become vacant in the event of 
the death, removal, resignation, or disqualification, the alternate of 
that member shall automatically assume the position of said member. The 
alternate shall serve until the end of the member's normal term. If 
there is no alternate member to assume the position of member, the 
successor member and alternate shall be nominated and selected in the 
manner specified in Sec. Sec. 1219.31, 1219.32, or 1219.33.
    (d) Should any alternate member become vacant in the event of death, 
removal, resignation, or disqualification, the Board may nominate 
persons to serve for the unexpired term of such alternate member. The 
nomination shall be conducted at a regularly scheduled Board meeting as 
soon as practicable after the vacancy occurs. The Board may solicit the 
names of nominees from producers and importers prior to the meeting and 
from the floor of the meeting. All nominees must meet the qualifications 
for nomination. The

[[Page 163]]

Board shall submit two nominees for each vacancy to the Secretary. A 
vacancy will not be required to be filled if the unexpired term is less 
than six months.



Sec. 1219.37  Alternate members.

    An alternate member of the Board, during the absence of the member 
for whom the person is the alternate, shall act in the place and stead 
of such member and perform such duties as assigned. In the event of the 
death, removal, resignation, or disqualification of any member, the 
alternate for that member shall automatically assume the position of 
said member. In the event that both a member of the Board and the 
alternate are unable to attend a meeting, the Board may not designate 
any other alternate to serve in such member's or alternate's place and 
stead for the meeting.



Sec. 1219.38  Powers and duties.

    The Board shall have the following powers and duties in addition to 
the responsibilities and authorities specified in other sections of this 
subpart:
    (a) To administer the Order in accordance with its terms and 
conditions and to collect assessments;
    (b) To develop and recommend to the Secretary for approval such 
bylaws as may be necessary for the functioning of the Board and such 
rules as may be necessary to administer the Order, including activities 
authorized to be carried out under the Order;
    (c) To meet, organize, and select from among the members of the 
Board a chairperson, other officers, committees, and subcommittees, at 
the start of each fiscal period, and at such other times as the Board 
determines to be appropriate;
    (d) To recommend to the Secretary rules and regulations to 
effectuate the terms and conditions of this subpart;
    (e) To employ such persons, other than the members, as the Board 
considers necessary to assist the Board in carrying out its duties and 
to determine the compensation and specify the duties of such persons;
    (f) To appoint from its members an executive committee and to 
delegate to the committee authority to administer the terms and 
provisions of this subpart under the direction of the Board and within 
the policies determined by the Board and approved by the Secretary;
    (g) To develop budgets for the implementation of this subpart and 
submit the budgets to the Secretary for approval and to propose and 
develop (or receive and evaluate), approve, and submit to the Secretary 
for approval programs, plans, and projects for Hass avocado promotion, 
industry information, consumer information, or related research;
    (h) To develop and implement after the approval by the Secretary 
programs, plans, and projects for Hass avocado promotion, industry 
information, consumer information, or related research, to contract or 
enter into agreements with appropriate persons to implement the 
programs, plans, and projects, and to pay the costs of the 
implementation of contracts and agreements with funds collected under 
this subpart.
    (i) To maintain such records and books and prepare and submit such 
reports and records from time to time to the Secretary as the Secretary 
may prescribe; to make appropriate accounting with respect to the 
receipt and disbursement of all funds entrusted to it; and to keep 
records that accurately reflect the actions and transactions of the 
Board;
    (j) To work to achieve an effective, continuous, and coordinated 
program of promotion, research, consumer information, and industry 
information designed to strengthen the Hass avocado industry's position 
in the domestic marketplace; to maintain and expand existing domestic 
markets and uses for Hass avocados; to create new domestic markets; and 
to carry out programs, plans, and projects designed to provide maximum 
benefits to the Hass avocado industry;
    (k) To evaluate on-going and completed programs, plans, and projects 
for Hass avocado promotion, industry information, consumer information, 
or related research and to comply with the independent evaluation 
provisions of the Federal Agricultural Improvement and Reform Act of 
1996 [7 U.S.C. 7401 et seq.];

[[Page 164]]

    (l) To receive, investigate, and report to the Secretary complaints 
of violations of the Order;
    (m) To recommend to the Secretary amendments to this Order;
    (n) To invest, pending disbursement under a program, plan, or 
project, funds collected through assessments authorized under this Act 
only in:
    (1) Obligations of the United States or any agency of the United 
States;
    (2) General obligations of any State or any political subdivision of 
a State;
    (3) Any interest-bearing account or certificate of deposit of a bank 
that is a member of the Federal Reserve System; or
    (4) Obligations fully guaranteed as to principal and interest by the 
United States, except that income from any such invested funds may be 
used only for a purpose for which the invested funds may be used;
    (o) To borrow funds necessary for the startup expenses of the Order;
    (p) To cause the books of the Board to be audited by a qualified 
independent auditor at the end of each fiscal period and to submit a 
report of the audit directly to the Secretary;
    (q) To give the Secretary the same notice of meetings and 
teleconferences of the Board and its committees as is given to members 
in order that the Secretary's representative(s) may attend or 
participate in the meetings;
    (r) To act as intermediary between the Secretary and any producer, 
first handler, or importer;
    (s) To periodically prepare and make public reports of its 
activities carried out, and at least once each fiscal period, to make 
public an accounting of funds received and expended; and
    (t) To notify Hass avocado producers, first handlers, and importers 
of all Board meetings through news releases or other means.



Sec. 1219.39  Board procedure.

    (a) At a properly convened meeting of the Board, seven (7) members, 
including alternates acting in place of members of the Board, shall 
constitute a quorum: Provided, that such alternates shall serve only 
when the member is absent from a meeting. Any action of the Board shall 
require the concurring votes of a majority of those present and voting. 
At assembled meetings, all votes shall be cast in person.
    (b) In lieu of voting at a properly convened meeting and, when in 
the opinion of the chairperson of the Board such action is considered 
necessary, the Board may take action if supported by one vote more than 
50 percent of the members by mail, telephone, electronic mail, 
facsimile, or other means of communication. Such alternative means for 
the Board taking action may be undertaken for various reasons. These 
reasons include the need to address matters of an emergency nature when 
there is not enough time to call an assembled meeting of the Board. All 
telephone votes shall be confirmed promptly in writing. In that event, 
all members must be notified and provided an opportunity to vote. Any 
action so taken shall have the same force and effect as though such 
action had been taken at a properly convened meeting of the Board. All 
votes shall be recorded in the Board minutes.
    (c) All Board members and alternates and the Secretary will be 
notified at least 10 days in advance of all Board meetings, except the 
chairperson of the Board can waive the 10-day requirement in matters of 
an emergency nature.
    (d) Each member of the Board will be entitled to one vote on any 
matter put to the Board, and the motion will carry if supported by one 
vote more than 50 percent of the total votes represented by the Board 
members present.
    (e) There shall be no voting by proxy.
    (f) The chairperson shall be a voting member of the Board.



Sec. 1219.40  Committee procedure.

    (a) The Board may establish committees as deemed necessary to carry 
out the purposes and objectives of the Order.
    (b) The chairperson of the Board shall appoint all committee 
chairpersons and shall appoint all members of each committee after 
consultation with the committee chairperson affected. Appointments are 
subject to approval by the Board and may be changed from time to time as 
determined by the chairperson of the Board with the concurrence of the 
Board.

[[Page 165]]

    (c) The chairperson of the Board may appoint committee members from 
among the Board members and alternates and from the industry in general.
    (d) The rules and procedures under which committees conduct their 
activities shall be prescribed in the Board's bylaws.
    (e) Committee members and the Secretary will be notified at least 10 
days in advance of all committee meetings.
    (f) It will be considered a quorum at a committee meeting when at 
least one more than half of those assigned to the committee are present.
    (g) There shall be no voting by proxy on committees.
    (h) The chairperson of the Board shall be an ex-officio member of 
all committees.



Sec. 1219.41  Compensation and expenses.

    (a) The members and alternates of the Board and committee members 
shall serve without compensation but shall be reimbursed for reasonable 
out-of-pocket expenses, as approved by the Board, incurred by them in 
the performance of their duties.
    (b) The Board shall have in place sufficient internal controls to 
prevent reimbursements or expenditures for unreasonable or otherwise 
controversial travel and meeting expenses.



Sec. 1219.42  Prohibited activities.

    The Board may not engage in and shall prohibit its employees and 
agents from engaging in:
    (a) Any action that would be a conflict of interest. For the 
purposes of this subpart, Board members and employees thereof must 
disclose any relationship with any organization or company that has a 
contract with the Board or operates a State promotion program. No member 
may vote on any matter in which the member or member's business entity 
has a financial interest.
    (b) Using funds collected under this subpart for the purpose of 
influencing legislation or governmental action or policy, by local, 
national, and foreign governments, except to develop and make 
recommendations to the Secretary as provided for in this subpart.
    (c) In a program, plan, or project conducted under this subpart:
    (1) Making any reference to private brand names or making false, 
misleading, disparaging, or unwarranted claims on behalf of Hass 
avocados or
    (2) Making any false, misleading, or disparaging statements with 
respect to the attributes or use of any agricultural product. This 
section shall not preclude the Board from offering its programs, plans, 
and projects for use by commercial parties under such terms and 
conditions as the Board may prescribe as approved by the Secretary.
    (d) For the purposes of this section, a reference to State of origin 
or country of origin does not constitute a reference to a private brand 
name with regard to any funds credited to or disbursed by the Board to 
the Association or to any importer association established in accordance 
with Sec. 1219.54.

                   Budgets, Expenses, and Assessments



Sec. 1219.50  Budgets, programs, plans, and projects.

    (a) The Board shall submit to the Secretary, on a fiscal period 
basis, annual budgets of its anticipated expenses and disbursements of 
the Board in the administration of this subpart, including the projected 
costs of Hass avocado promotion, industry information, consumer 
information, and related research programs, plans, and projects. The 
first budget shall cover such period as may remain before the beginning 
of the next fiscal period. If such fiscal period is 90 days or less, the 
first budget shall cover such period, as well as the next fiscal period. 
Thereafter, the Board shall submit budgets for each succeeding fiscal 
period not less than 60 days before the beginning of such fiscal period.
    (b) The Board shall receive and evaluate, or on its own initiative 
develop programs, plans and projects for Hass avocado promotion, 
industry information, consumer information as well as related research. 
The Board shall submit to the Secretary for approval any program, plan, 
or project authorized in this subpart. Such programs, plans or projects 
shall provide for:
    (1) The establishment, implementation, issuance, effectuation, 
administration, and evaluation of appropriate

[[Page 166]]

programs, plans, or projects for advertising, sales promotion, other 
promotion, and consumer information with respect to Hass avocados 
directed toward increasing the general demand for Hass avocados in the 
United States. Funds shall be available as necessary to carry out this 
section;
    (2) The establishment, implementation, issuance, effectuation, 
administration, and evaluation of appropriate programs, plans, and 
projects designed to strengthen the position of the Hass avocado 
industry in the domestic marketplace; to maintain, develop, and expand 
markets for Hass avocados in the United States; to lead to the 
development of new marketing strategies; to advance the image and 
desirability of, increase the efficiency of, and encourage further 
development of the Hass avocado industry; and to provide for the 
disbursement of necessary funds for the purposes described in this 
section;
    (3) The establishment, implementation, issuance, effectuation, 
administration, and evaluation of programs, plans, and projects for 
marketing development research; research on the sale, distribution, 
marketing, use, quality, and nutritional value of Hass avocados; and 
other research with respect to Hass avocado marketing, promotion, 
industry information, or consumer information, including the creation of 
new products thereof. Information acquired from such plans and projects 
shall be disseminated as appropriate. Funds shall be available as 
necessary to carry out this section; and
    (4) The Board to enter into contracts or make agreements for the 
development and carrying out of research, promotion, and information, 
and pay for the costs of such contracts or agreements with funds 
collected pursuant to Sec. 1219.54.
    (c) A budget, program, plan, or project for Hass avocados promotion, 
industry information, consumer information, or related research may not 
be implemented prior to approval of the budget, program, plan, or 
project by the Secretary. If the Secretary fails to provide notice to 
the Board or approval or disapproval of a budget, program, plan, or 
project within 45 days after receipt, such budget, program, plan, or 
project shall be deemed approved by the Secretary and may be implemented 
by the Board.
    (d) The Board, from time to time, may seek advice and consult with 
experts from the production, import, wholesale, and retail segments of 
the Hass avocado industry to assist in the development of promotion, 
industry information, consumer information, and related research 
programs, plans, and projects. For these purposes, the Board may appoint 
special committees composed of persons other than Board members. A 
committee so appointed shall consult directly with the Board.
    (e) Programs must be conducted throughout the year to reflect the 
periods when imported and domestic Hass avocados are in the U.S. 
marketplace.
    (f) The Board shall consult with both the Association and importer 
associations on programs, plans, and projects for generic promotions.



Sec. 1219.51  Contracts and agreements.

    (a) The Board shall enter into a contract or an agreement with the 
Association for the implementation of programs, plans, or projects for 
promotion, industry information, consumer information, or related 
research with respect to Hass avocados and for the payment of the cost 
of the contract or agreement with funds received by the Board under this 
subpart. The Board may disburse such funds as necessary for these 
purposes after such programs, plans, or projects have been submitted to 
and approved by the Secretary.
    (b) Any contract or agreement entered into shall provide that the 
contracting or agreeing party shall develop and submit to the Board a 
program, plan or project, together with a budget that includes the 
estimated costs to be incurred for the program, plan or project, and 
such program, plan or project shall become effective on the approval of 
the Secretary. For such contract or agreement, the contracting or 
agreeing party shall:
    (1) Keep accurate records of all transactions of the party;
    (2) Account for funds received and expended;
    (3) Make periodic reports to the Board of activities conducted; and

[[Page 167]]

    (4) Make such other reports as the Board or the Secretary shall 
require.
    (c) The Secretary may audit the records of the contracting or 
agreeing party periodically.
    (d) Contractors and subcontractors are subject to the provisions of 
Sec. 1219.42.
    (e) The Board may enter into contracts or agreements for 
administrative services, including contracts for employment, as may be 
required to conduct its business. To the extent appropriate to the 
contract involved, contracts or agreements entered into by the Board 
under the authority of this section shall conform to the provisions 
described in paragraph (b) of this section.



Sec. 1219.52  Control of administrative costs.

    (a) As soon as practicable after September 9, 2002, and after 
consultation with the Secretary and other appropriate persons, the Board 
shall implement a system of cost controls based on normally accepted 
business practices to:
    (1) Ensure that the costs incurred by the Board in administering 
this part in any fiscal period shall not exceed 10 percent of the 
projected level of assessments and other income received by the Board 
for generic promotion and research programs for that fiscal period; and
    (2) Cover the minimum administrative activities and personnel needed 
to properly administer and enforce this subpart, and conduct, supervise, 
and evaluate programs, plans, and projects under this subpart.
    (b) Reimbursements to the Secretary required under Sec. 1219.53(b) 
are excluded from the limitation on spending.
    (c) To the extent possible, the Board shall use the resources, 
staffs, and facilities of existing avocado organizations as provided in 
Sec. 1219.54(a).



Sec. 1219.53  Budget and expenses.

    (a) The Board is authorized to incur such expenses, including 
provision for a reasonable reserve for operating contingencies, as the 
Secretary finds are reasonable and likely to be incurred by the Board 
for its maintenance and functioning and to enable it to exercise its 
powers and perform its duties in accordance with the provisions of this 
subpart. Such expenses shall be paid from funds received by the Board, 
including assessments, contributions from any person not subject to 
assessments under this subpart, and other funds available to the Board.
    (b) The Board shall reimburse the Department:
    (1) For expenses not to exceed $25,000 incurred by the Secretary in 
connection with any referendum conducted under the Act;
    (2) For administrative costs incurred by the Secretary for 
supervisory work of up to two employee years annually after the Order or 
amendment to the Order has been issued and made effective; and
    (3) For costs incurred by the Secretary in implementation of the 
Order, for enforcement of the Act and the order, for subsequent 
referenda conducted under the Act, and in defending the Board in 
litigation arising out of action taken by the Board or otherwise in 
defense of the Order.
    (c) The Board shall establish and maintain the minimum level of 
annual administrative expenses necessary to efficiently and effectively 
carry out the programs authorized by the Act. The Board shall include 
its annual administrative expenses as a separate item in its annual 
report. The Board shall adhere to its fiduciary responsibilities and 
ensure that all monies are spent in accordance with the Act and the 
Order.
    (d) With the approval of the Secretary, the Board may borrow money 
for the payment of administrative expenses, subject to the same fiscal, 
budget, and audit controls as other funds of the Board. Any funds 
borrowed by the Board shall be expended only for startup costs and 
capital outlays and are limited to the first period of operation of the 
Board.
    (e) The Board may accept voluntary contributions, but these shall 
only be used to pay expenses incurred in the conduct of programs, plans, 
and projects. The contributions shall be free from any encumbrance by 
the donor, and the Board shall retain complete control of their use.

[[Page 168]]



Sec. 1219.54  Assessments.

    (a) Except as provided in Sec. 1219.55, the initial rate of 
assessment shall be 2.5 cents per pound on fresh Hass avocados produced 
and handled in the United States and on fresh Hass avocados imported 
into the United States. An equivalent rate shall be assessed on 
processed and frozen Hass avocados on which an assessment has not been 
paid. Such equivalent rate will be assessed on processed or frozen Hass 
avocados upon the recommendation of the Board with the approval of the 
Secretary. The rate of assessment may be increased or decreased as 
recommended by the Board and approved by the Secretary. Such an increase 
or decrease may occur not more than once annually. Any change in the 
assessment rate shall be announced by the Board at least 30 days prior 
to going into effect and shall not be subject to a vote in a referendum. 
The maximum assessment rate authorized is 5 cents per pound. No more 
than one assessment shall be made on any Hass avocados.
    (b) Domestic assessments. The collection of assessments on domestic 
Hass avocados will be the responsibility of the first handler.
    (1) In the case of a producer acting as the producer's own first 
handler, the producer will be required to collect and remit the 
assessments due to the Board.
    (2) Each first handler shall collect from the producer and pay to 
the Board an assessment of 2.5 cents per pound in accordance with this 
subpart. Assessments shall be remitted by each first handler to the 
Board or its agent within 30 days after the end of the month in which 
the sale or non-sale transfer subject to assessment under this subpart 
took place.
    (3) The first handler shall maintain a separate record of the 
domestic Hass avocados of each producer whose domestic Hass avocados are 
handled, including the domestic Hass avocados owned by the handler and 
domestic Hass avocados that are exported.
    (4) Assessment of other types of fresh avocados may be added at the 
recommendation of the Board with the approval of the Secretary.
    (c) Import assessments. Each importer of fresh Hass avocados shall 
pay an assessment to the Board through Customs on fresh Hass avocados 
imported for marketing in the United States.
    (1) The assessment rate for imported fresh Hass avocados shall be 
the same or equivalent to the rate for fresh Hass avocados produced and 
handled in the United States.
    (2) The import assessment shall be uniformly applied to imported 
fresh Hass avocados that are identified by the number 0804.40.00.10 in 
the Harmonized Tariff Schedule of the United States or any other numbers 
to identify fresh Hass avocados. Assessments on other types of imported 
fresh avocados or on processed Hass avocados, such as prepared, 
preserved, or frozen Hass avocados or Hass avocado paste, puree, and oil 
will be added at the recommendation of the Board with the approval of 
the Secretary.
    (3) The assessments due on imported Hass avocados shall be paid when 
they are released from custody by Customs and introduced into the stream 
of commerce in the United States.
    (d) All assessment payments and reports will be submitted to the 
Board's office. All final payments for a crop year are to be received no 
later than November 30 of that year, unless the Board determines that 
assessments due from the first handler shall be paid to the Board at a 
different time and manner, with approval of the Secretary.
    (e) A late payment charge prescribed by the Secretary shall be 
imposed on any first handler who fails to remit to the Board the total 
amount for which any such handler is liable on or before the due date. 
In addition to the late payment charge, an interest charge shall be 
imposed on the outstanding amount for which the handler is liable. The 
rate of interest shall be prescribed by the Secretary. The timeliness of 
a payment to the Board shall be based on the date the payment is 
actually received by the Board.
    (f) Regulations issued by the Secretary may provide for different 
first handler payment schedules of assessments on domestic Hass 
avocados, so as to recognize differences in marketing or purchasing 
practices and procedures.
    (g) Persons failing to remit total assessments due in a timely 
manner may

[[Page 169]]

also be subject to actions under federal debt collection procedures.
    (h) The Board may authorize other organizations to collect 
assessments on its behalf with approval of the Secretary.
    (i) The collection of assessments shall commence on or after a date 
established by the Secretary and shall continue until terminated by the 
Secretary. If the Board is not constituted on the date the first 
assessments are to be remitted, the Secretary shall have the authority 
to receive assessments on behalf of the Board and may hold such 
assessments in an interest-bearing account until the Board is 
constituted and the funds are transferred to the Board.
    (j) To facilitate the payment of assessments under this section, the 
Board shall publish lists of first handlers required to remit 
assessments under this subpart and exempt handlers.
    (k) The Association shall receive an amount of assessment funds 
equal to 85 percent of the assessments paid on Hass avocados produced in 
such State. Such funds shall be remitted to such State organization no 
later than 30 days after such funds are received by the Board. In 
addition, such funds and any proceeds from the investment of such funds 
shall be used by the Association to finance promotion, research, 
consumer information, and industry information programs, plans, and 
projects in the United States. However, no such funds shall be used for 
any administrative expenses incurred by the Association.
    (l) An association of Hass avocado importers established pursuant to 
Sec. 1219.58 shall receive an amount of assessment funds equal to 85 
percent of the assessments paid on Hass avocados imported by its 
members. Such funds shall be remitted to such importer association no 
later than 30 days after such funds are received by the Board. In 
addition, such funds and any proceeds from the investment of such funds 
shall be used by the importer association to finance promotion, 
research, consumer information, and industry information programs, 
plans, and projects in the United States. However, no such funds shall 
be used for any administrative expenses incurred by the importer 
association.
    (m) In general, assessment funds received by the Board shall be 
used:
    (1) For payment of costs incurred in implementing and administering 
this subpart;
    (2) To provide for a reasonable reserve to be maintained from 
assessments to be available for contingencies; and
    (3) To cover the administrative costs incurred by the Secretary in 
implementing and administering this Act, as set forth in Sec. 
1219.53(b).
    (n) The Board may establish an operating monetary reserve which may 
carry over to subsequent fiscal periods: Provided that, the funds in the 
reserve do not exceed one fiscal period's budget. Subject to approval by 
the Secretary, reserve funds may be used to defray any expenses 
authorized under this part.



Sec. 1219.55  Exemption from assessment.

    (a) Any sale of Hass avocados for export from the United States is 
exempt from assessment.
    (b) The Board may require persons receiving an exemption from 
assessments to provide to the Board reports on the disposition of exempt 
Hass avocados.



Sec. 1219.56  Adjustment of accounts.

    Whenever the Board or the Secretary determines through an audit of a 
person's reports, records, books, or accounts or by some other means 
that additional money is due to the Board, the person shall be notified 
of the amount due. The person shall then remit any amount due the Board 
by the next date for remitting assessments. Overpayments shall be 
credited to the account of the person remitting the overpayment and 
shall be applied against any amounts due in succeeding months unless the 
person requests a refund of the overpayment.

[[Page 170]]



Sec. 1219.57  Patents, copyrights, trademarks, publications, and product 
formulations.

    (a) Any patents, copyrights, trademarks, inventions, information, 
publications, and product formulations developed through the use of 
funds received by the Board under this subpart shall be the property of 
the U.S. Government as represented by the Board, and shall, along with 
any rents, royalties, residual payments, or other income from the 
rental, sale, leasing, franchising, or other uses of such patents, 
copyrights, trademarks, inventions, information, publications, or 
product formulations, inure to the benefit of the Board; shall be 
considered income subject to the same fiscal, budget, and audit controls 
as other funds of the Board; and may be licensed subject to approval of 
the Secretary. Section 1219.72 describes the procedures for termination.
    (b) Should patents, copyrights, trademarks, inventions, 
publications, or product formulations be developed through the use of 
funds collected by the Board under this subpart and funds contributed by 
another organization or person, ownership and related rights to such 
patents, copyrights, trademarks, inventions, publications, or product 
formulations shall be determined by agreement between the Board and the 
party contributing funds towards the development of such patent, 
copyright, trademark, invention, publication, or product formulation in 
a manner consistent with paragraph (a) of this section.



Sec. 1219.58  Importer associations.

    (a) An association of avocado importers is eligible to receive 
assessment funds and any proceeds from the investment of such funds only 
if such importer association is:
    (1) Established pursuant to State law that requires detailed State 
regulation comparable to that applicable to the State organization of 
domestic avocado producers, as determined by the Secretary; or
    (2) Certified by the Secretary as meeting the requirements 
applicable to the Board as to its operations and obligations, including 
budgets, programs, plans, projects, audits, conflicts of interest, and 
reimbursements for administrative costs incurred by the Secretary.
    (b) An importer association may represent any importers of Hass 
avocados including importers of Hass avocados from a particular foreign 
country. An importer association may be composed of importers as well as 
representatives of foreign avocado exporting industries. An importer 
association should establish it own bylaws and may use existing 
organizations for the establishment of the association and coordination 
of the association's promotion and research efforts.
    (c) For the purposes of the Order, the information required for 
certification of the importer associations by the Secretary may include, 
but is not limited to, the following:
    (1) Evidence of incorporation under any state law with all 
appropriate legal requirements;
    (2) Evidence that the association is composed of importers that are 
located in any state and subject to assessments under the Order, no 
matter where the association has been incorporated or in which state the 
importers reside;
    (3) Certification of the association's ability and willingness to 
further the aims and objectives of the Order;
    (4) Evidence of stability and permanency; and
    (5) A description of the functions of the association.

                       Books, Records, and Reports



Sec. 1219.60  Reports.

    (a) Each first handler of domestic Hass avocados, producer, and 
importer subject to this subpart shall report to the administrative 
staff of the Board, at such times and in such manner as the Board may 
prescribe, such information as may be necessary for the Board to perform 
its duties.
    (b) First handler reports shall include, but shall not be limited 
to, the following:
    (1) Number of pounds of domestic Hass avocados received during the 
reporting period;
    (2) Number of pounds on which assessments were collected;
    (3) Assessments collected during the reporting period;

[[Page 171]]

    (4) Name and address of person(s) from whom the first handler 
collected the assessments on each pound handled;
    (5) Date collection was made on each pound handled;
    (6) Record of assessments paid, including a statement from the 
handler that assessments have been paid on all domestic Hass avocados 
handled during the reporting period; and
    (7) Number of pounds exported.
    (c) Each importer subject to this subpart may be required to report 
the following:
    (1) Number of pounds of Hass avocados imported during the reporting 
period;
    (2) Number of pounds on which an assessment was paid;
    (3) Name and address of the importer;
    (4) Date collection was made on each pound imported and to whom 
payment was made; and
    (5) Record of each importation of Hass avocados during such period, 
giving quantity, variety, date, and port of entry.



Sec. 1219.61  Books and records.

    Each producer, first handler, and importer subject to this subpart 
shall maintain and make available for inspection by the employees and 
agents of the Board and the Secretary, such books and records as are 
necessary to carry out the provisions of this subpart, and the 
regulations issued thereunder, including such records as are necessary 
to verify any reports required. Books and records shall be retained for 
at least two years beyond the fiscal period of their applicability.



Sec. 1219.62  Books and records of the Board.

    (a) The Board shall maintain such books and records as the Secretary 
may require. Such books and records shall be made available upon request 
by the Secretary for inspection and audit.
    (b) The Board shall prepare and submit to the Secretary, from time 
to time, such reports as the Secretary may require.
    (c) The Board shall account for the receipt and disbursement of all 
the funds entrusted to the Board.
    (d) The Board shall cause the books and records of the Board to be 
audited by an independent auditor at the end of each fiscal period. A 
report of each audit shall be submitted to the Secretary.



Sec. 1219.63  Confidential treatment.

    (a) All information obtained from the books, records, or reports 
under the Act, this subpart, and the regulations issued thereunder shall 
be kept confidential and shall not be disclosed to the public by any 
person, including all current and former officers, employees, staff and 
agents of the Department, the Board, and contracting and subcontracting 
agencies or agreeing parties having access to such information. Only 
those persons having a specific need for such information to effectively 
administer the provisions of this subpart shall have access to such 
information. Only such information so obtained as the Secretary deems 
relevant shall be disclosed, and then only in a judicial proceeding or 
administrative hearing brought at the direction, or upon the request, of 
the Secretary, or to which the Secretary or any officer of the United 
States is a party, and involving this subpart. Nothing in this subpart 
shall be deemed to prohibit:
    (1) The issuance of general statements based upon the reports of the 
number of persons subject to this subpart or statistical data collected 
from such reports, if such statements do not identify the information 
furnished by any person; or
    (2) The publication, by direction of the Secretary, of the name of 
any person who has been adjudged to have violated this subpart, together 
with a statement of the particular provisions of this subpart violated 
by such person.
    (b) Any disclosure of any confidential information by any employee 
or agent of the Board shall be considered willful misconduct.
    (c) No information on how a person voted in a referendum conducted 
under the Act shall be made public.



Sec. 1219.64  List of importers.

    The administrative staff of the Board shall periodically review the 
list of importers of Hass avocados to determine

[[Page 172]]

whether persons on the list are subject to this subpart.



Sec. 1219.65  List of producers.

    The administrative staff of the Board shall periodically review the 
list of producers of Hass avocados to determine whether the persons on 
the list of subject to this subpart. On the request of the Secretary or 
the Board, the Association shall provide to the Secretary or the 
administrative staff of the Board the list of producers of Hass 
avocados.

                              Miscellaneous



Sec. 1219.70  Right of the Secretary.

    All fiscal matters, programs, plans, and projects, contracts, rules 
or regulations, reports, or other substantive actions proposed and 
prepared by the Board shall be submitted to the Secretary for approval.



Sec. 1219.71  Suspension or termination.

    (a) The Secretary shall suspend or terminate this part or subpart or 
a provision thereof if the Secretary finds that the part or subpart or a 
provision thereof obstructs or does not tend to effectuate the purposes 
of the Act, or if the Secretary determines that this part or subpart or 
a provision thereof is not favored by persons voting in a referendum 
conducted pursuant to the Order or the Act.
    (b) The Secretary shall suspend or terminate this subpart at the end 
of the marketing year whenever the Secretary determines that its 
suspension or termination is approved or favored by a majority of the 
producers and importers voting who, during a representative period 
determined by the Secretary, have been engaged in the production or 
importation of Hass avocados.
    (c) If, as a result of a referendum, the Secretary determines that 
this subpart is not approved, the Secretary shall:
    (1) Suspend or terminate, as appropriate, the collection of 
assessments not later than 180 days after making such determination; and
    (2) Suspend or terminate, as appropriate, all activities under this 
subpart in an orderly manner as soon as practicable.



Sec. 1219.72  Proceedings after termination.

    (a) Upon the termination of this subpart, the Board shall recommend 
to the Secretary not more than five of its members to serve as trustees 
for the purpose of liquidating the affairs of the Board. Such persons, 
upon designation by the Secretary, shall become trustees of all of the 
funds and property owned, in possession of or under control of the 
Board, including claims for any funds unpaid or property not delivered 
or any other claim existing at the time of such termination.
    (b) The said trustees shall:
    (1) Continue in such capacity until discharged by the Secretary;
    (2) Carry out the obligations of the Board under any contracts or 
agreements entered into by it pursuant to the Order;
    (3) From time to time account for all receipts and disbursements and 
deliver all property on hand, together with all books and records of the 
Board and of the trustees, to such person or persons as the Secretary 
may direct; and
    (4) Upon the request of the Secretary, execute such assignments or 
other instruments necessary and appropriate to vest in such persons 
title and right to all of the funds, property, and claims vested in the 
Board or the trustees pursuant to the Order.
    (c) Any person to whom funds, property, or claims have been 
transferred or delivered pursuant to the Order shall be subject to the 
same obligations imposed upon the Board and the trustees.
    (d) Any residual funds not required to defray the necessary expenses 
of liquidation shall be returned to the persons who contributed such 
funds, or paid assessments, or, if not practicable, shall be turned over 
to the Secretary to be distributed to authorized Hass avocado producer 
and importer organizations in the interest of continuing Hass avocado 
promotion, research, and information programs.



Sec. 1219.73  Effect of termination or amendment.

    Unless otherwise expressly provided by the Secretary, the 
termination of this subpart or any regulation issued

[[Page 173]]

thereunder, or the issuance of any amendment to either thereof, shall 
not:
    (a) Affect or waive any right, duty, obligation, or liability which 
shall have arisen or which may thereafter arise in connection with any 
provision of this subpart or any such rule or regulation issued 
thereunder; or
    (b) Release or extinguish any violation of this subpart or of any 
rule or regulation issued thereunder; or
    (c) Affect or impair any rights or remedies of the United States, or 
of the Secretary or of any person, with respect to any such violation.



Sec. 1219.74  Personal liability.

    No member, alternate member, employee, or agent of the Board shall 
be held personally responsible, either individually or jointly with 
others, in any way whatsoever, to any person for errors in judgment, 
mistakes, or other acts, either of Association or omission, as such 
member, alternate, employee, or agent, except for acts of dishonesty or 
willful misconduct.



Sec. 1219.75  Separability.

    If any provision of this subpart is declared invalid or the 
applicability thereof to any person or circumstance is held invalid, the 
validity of the remainder of this subpart, or the applicability thereof 
to other persons or circumstances shall not be affected thereby.



Sec. 1219.76  Amendments.

    Amendments to this subpart may be proposed, from time to time, by 
the Board or by any interested persons affected by the provisions of the 
Act, including the Secretary. Except for changes in the assessment rate, 
the provisions of the Act applicable to the Order are applicable to any 
amendment of the Order.



Sec. 1219.77  OMB control numbers.

    The control numbers assigned to the information collection 
requirements in this part by the Office of Management and Budget 
pursuant to the Paperwork Reduction Act of 1995, 44 U.S.C. Chapter 35, 
are OMB control numbers 0581-0197 and 0505-0001.



                     Subpart B_Referendum Procedures



Sec. 1219.100  General.

    Referenda to determine whether eligible producers and importers of 
Hass avocados favor the issuance, amendment, suspension, or termination 
of the Hass Avocado Promotion, Research, and Information Order shall be 
conducted in accordance with this subpart.



Sec. 1219.101  Definitions.

    (a) Administrator means the Administrator of the Agricultural 
Marketing Service, with power to redelegate, or any officer or employee 
of the U.S. Department of Agriculture to whom authority has been 
delegated or may hereafter be delegated to act in the Administrator's 
stead.
    (b) Eligible importer means any person who imported Hass avocados 
that are identified by the number 0804.40.00.10 in the Harmonized Tariff 
Schedule of the United States for at least one year prior to the 
referendum. Importation occurs when Hass avocados originating outside of 
the United States are released from custody by the U.S. Customs Service 
and introduced into the stream of commerce in the United States. 
Included are persons who hold title to foreign-produced Hass avocados 
immediately upon release by the U.S. Customs Service, as well as any 
persons who act on behalf of others, as agents or brokers, to secure the 
release of Hass avocados from the U.S. Customs Service when such Hass 
avocados are entered or withdrawn for consumption in the United States.
    (c) Eligible producer means any person who produced Hass avocados in 
the United States for at least one year prior to the referendum who:
    (1) Owns, or shares the ownership and risk of loss of, the crop;
    (2) Rents Hass avocado production facilities and equipment resulting 
in the ownership of all or a portion of the Hass avocados produced;
    (3) Owns Hass avocado production facilities and equipment but does 
not manage them and, as compensation, obtains the ownership of a portion 
of the Hass avocados produced; or

[[Page 174]]

    (4) Is a party in a landlord-tenant relationship or a divided 
ownership arrangement involving totally independent entities cooperating 
only to produce Hass avocados who share the risk of loss and receive a 
share of the Hass avocados produced. No other acquisition of legal title 
to Hass avocados shall be deemed to result in persons becoming eligible 
producers.
    (d) Hass avocados means the fruit grown in or imported into the 
United States of the species Persea americana Mill. For the purposes of 
the initial referendum, the term shall include fresh fruit only.
    (e) Order means the Hass Avocado Promotion, Research, and 
Information Order.
    (f) Person means any individual, group of individuals, partnership, 
corporation, association, cooperative, or any other legal entity. For 
the purpose of this definition, the term ``partnership'' includes, but 
is not limited to:
    (1) A husband and a wife who have title to, or leasehold interest 
in, a Hass avocado farm as tenants in common, joint tenants, tenants by 
the entirety, or, under community property laws, as community property; 
and
    (2) So-called ``joint ventures'' wherein one or more parties to an 
agreement, informal or otherwise, contributed land and others 
contributed capital, labor, management, or other services, or any 
variation of such contributions by two or more parties.
    (g) Referendum agent or agent means the individual or individuals 
designated by the Administrator to conduct the referendum.
    (h) Representative period means the period designated by the 
Administrator.
    (i) United States. The term ``United States'' means collectively of 
the several 50 States of the United States, the District of Columbia, 
the Commonwealth of Puerto Rico, the Commonwealth of the Northern 
Mariana Islands, the United States Virgin Islands, Guam, American Samoa, 
the Republic of the Marshall Islands, and the Federated States of 
Micronesia.

[67 FR 7264, Feb. 19, 2002; 67 FR 13563, Mar. 25, 2002]



Sec. 1219.102  Registration.

    An eligible producer or importer of Hass avocados, as defined in 
this subpart, at the time of the referendum and during a representative 
period, who chooses to vote in any referendum conducted under this 
subpart, shall register with the referendum agent prior to the voting 
period, after receiving notice from the referendum agent concerning the 
referendum under Sec. 1219.104(b). Registration information shall be 
confidential under Sec. 1219.108.



Sec. 1219.103  Voting.

    (a) Each eligible producer and eligible importer who registers to 
vote in the referendum shall be entitled to cast only one ballot in the 
referendum. However, each producer in a landlord-tenant relationship or 
a divided ownership arrangement involving totally independent entities 
cooperating only to produce Hass avocados, in which more than one of the 
parties is a producer, shall be entitled to cast one ballot in the 
referendum covering only such producer's share of the ownership.
    (b) Proxy voting is not authorized, but an officer or employee of an 
eligible corporate producer or importer, or an administrator, executor, 
or trustee or an eligible entity may cast a ballot on behalf of such 
entity. Any individual so voting in a referendum shall certify that such 
individual is an officer or employee of the eligible entity, or an 
administrator, executive, or trustee of an eligible entity and that such 
individual has the authority to take such action. Upon request of the 
referendum agent, the individual shall submit adequate evidence of such 
authority.
    (c) All ballots are to be cast by mail or fax, as instructed by the 
referendum agent.



Sec. 1219.104  Instructions.

    The referendum agent shall conduct the referendum, in the manner 
herein provided, under the supervision of the Administrator. The 
Administrator may prescribe additional instructions, not inconsistent 
with the provisions hereof, to govern the procedure to be followed by 
the referendum agent. Such agent shall:

[[Page 175]]

    (a) Determine the period during which ballots may be cast (voting 
period).
    (b) Notify producers and importers of the voting period for the 
referendum and the requirement to register to vote in the referendum at 
least 30 days in advance by utilizing available media or public 
information sources, without incurring advertising expense, to publicize 
the dates, places, method of voting, eligibility requirements, and other 
pertinent information. Such sources of publicity may include, but are 
not limited to, print and radio.
    (c) Develop the ballots and related material to be used in the 
referendum. The ballot shall provide for recording essential 
information, including that needed for ascertaining whether the person 
voting, or on whose behalf the vote is cast, is an eligible voter.
    (d) Develop a list of producers and importers who register to vote.
    (e) Mail to registered voters the instructions on voting, a ballot, 
and a summary of the terms and conditions of the proposed Order.
    (f) At the end of the voting period, collect, open, number, and 
review the ballots and tabulate the results in the presence of an agent 
of a third party authorized to monitor the referendum process.
    (g) Prepare a report on the referendum.
    (h) Announce the results to the public.



Sec. 1219.105  Subagents.

    The referendum agent may appoint any individual or individuals 
necessary or desirable to assist the agent in performing such agent's 
functions hereunder. Each individual so appointed may be authorized by 
the agent to perform any or all of the functions which, in the absence 
of such appointment, shall be performed by the agent.



Sec. 1219.106  Ballots.

    The referendum agent and subagents shall accept all ballots cast. 
However, if an agent or subagent deems that a ballot should be 
challenged for any reason, the agent or subagent shall endorse above 
their signature, on the ballot, a statement to the effect that such 
ballot was challenged, by whom challenged, the reasons therefore, the 
results of any investigations made with respect thereto, and the 
disposition thereof. Ballots invalid under this subpart shall not be 
counted.



Sec. 1219.107  Referendum report.

    Except as otherwise directed, the referendum agent shall prepare and 
submit to the Administrator a report on the results of the referendum, 
the manner in which it was conducted, the extent and kind of public 
notice given, and other information pertinent to the analysis of the 
referendum and its results.



Sec. 1219.108  Confidential information.

    The list of registered voters, ballots, and all other information or 
reports that reveal, or tend to reveal, the identity or vote of voters 
in the referendum shall be strictly confidential and shall not be 
disclosed.



Sec. 1219.109  OMB control number.

    The control number assigned to the information collection 
requirement in this subpart by the Office of Management and Budget 
pursuant to the Paperwork Reduction Act of 1995, 44 U.S.C. Chapter 35 is 
OMB control number 0581-0197.



PART 1220_SOYBEAN PROMOTION, RESEARCH, AND CONSUMER INFORMATION--Table 
of Contents




             Subpart A_Soybean Promotion and Research Order

                               Definitions

Sec.
1220.101 Act.
1220.102 Board.
1220.103 Commerce.
1220.104 Committee.
1220.105 Consumer information.
1220.106 [Reserved]
1220.107 Cooperator organization.
1220.108 Department.
1220.109 Eligible organization.
1220.110 First purchaser.
1220.111 Fiscal period.
1220.112 Industry information.
1220.113 Marketing.
1220.114 National nonprofit producer-governed organization.
1220.115 Net market price.
1220.116 Part and subpart.
1220.117 Plans and projects.

[[Page 176]]

1220.118 Person.
1220.119 Producer.
1220.120 [Reserved]
1220.121 Promotion.
1220.122 Qualified State Soybean Board.
1220.123 Referendum.
1220.124 [Reserved]
1220.125 Research.
1220.126 Secretary.
1220.127 Soybean products.
1220.128 Soybeans.
1220.129 State and United States.
1220.130 Unit.

                          United Soybean Board

1220.201 Membership of board.
1220.202 Term of office.
1220.203 Nominations.
1220.204 Appointment.
1220.205 Nominee's agreement to serve.
1220.206 Vacancies.
1220.207 Alternate members.
1220.208 Removal.
1220.209 Procedure.
1220.210 Compensation and reimbursement.
1220.211 Powers of the Board.
1220.212 Duties.

                 Soybean Program Coordinating Committee

1220.213 Establishment and membership.
1220.214 Term of office.
1220.215 Vacancies.
1220.216 Procedure.
1220.217 Compensation and reimbursement.
1220.218 Officers of the Committee.
1220.219 Powers of the Committee.
1220.220 Duties of the Committee.

                        Expenses and Assessments

1220.222 Expenses.
1220.223 Assessments.
1220.224-1220.227 [Reserved]
1220.228 Qualified State Soybean Boards.
1220.229 Influencing governmental action.
1220.230 Promotion, research, consumer information, and industry 
          information.

                       Reports, Books, and Records

1220.241 Reports.
1220.242 Books and records.
1220.243 Confidential treatment.

                              Miscellaneous

1220.251 Proceedings after termination.
1220.252 Effect of termination or amendment.
1220.253 Personal liability.
1220.254 Patents, copyrights, inventions, and publications.
1220.255 Amendments.
1220.256 Separability.
1220.257 OMB control numbers.

                     Subpart B_Rules and Regulations

                               Definitions

1220.301 Terms defined.

                               Assessments

1220.310 Assessments.
1220.311 Collection and remittance of assessments.
1220.312 Remittance of assessments and submission of reports to United 
          Soybean Board or Qualified State Soybean Board.
1220.313 Qualified State Soybean Boards.
1220.314 Document evidencing payment of assessments.
1220.330-120.332 [Reserved]

Subparts C-E [Reserved]

              Subpart F_Procedures To Request a Referendum

                               Definitions

1220.600 Act.
1220.601 Administrator, AMS.
1220.602 Administrator, FSA.
1220.603 Farm Service Agency.
1220.604 Farm Service Agency County Committee.
1220.605 Farm Service Agency County Executive Director.
1220.606 Farm Service Agency State Committee.
1220.607 Farm Service Agency State Executive Director.
1220.608 Order.
1220.609 Person.
1220.610 Producer.
1220.611 Public notice.
1220.612 Representative period.
1220.613 Secretary.
1220.614 Soybeans.
1220.615 State and United States.

                               Procedures

1220.616 General.
1220.617 Supervision of the process for requesting a referendum.
1220.618 Eligibility.
1220.619 Time and place for requesting a referendum.
1220.620 Facilities.
1220.621 Certification and request form.
1220.622 Certification and request procedures.
1220.623 Canvassing requests.
1220.624 Confidentiality.
1220.625 Counting requests.
1220.626 FSA county office report.
1220.627 FSA State office report.
1220.628 Results of the request for referendum.
1220.629 Disposition of records.
1220.630 Instructions and forms.

    Authority: 7 U.S.C. 6301-6311.

[[Page 177]]



             Subpart A_Soybean Promotion and Research Order

    Source: 56 FR 31049, July 9, 1991, unless otherwise noted.

                               Definitions



Sec. 1220.101  Act.

    The term Act means the Soybean Promotion, Research, and Consumer 
Information Act, subtitle E of title XIX, of the Food, Agriculture, 
Conservation and Trade Act of 1990, Public Law No. 101-624, and any 
amendments thereto.



Sec. 1220.102  Board.

    The term Board means the United Soybean Board established under 
Sec. 1220.201 of this subpart.



Sec. 1220.103  Commerce.

    The term commerce means interstate, foreign, or intrastate commerce.



Sec. 1220.104  Committee.

    The term Committee means the Soybean Program Coordinating Committee 
established under Sec. 1220.213 of this subpart.



Sec. 1220.105  Consumer information.

    The term consumer information means information that will assist 
consumers and other persons in making evaluations and decisions 
regarding the purchase, preparation, and use of soybeans or soybean 
products.



Sec. 1220.106  [Reserved]



Sec. 1220.107  Cooperator organization.

    The term Cooperator Organization means the American Soybean 
Association, or any successor organization to the American Soybean 
Association, which conducts foreign market development activities on 
behalf of soybean producers.



Sec. 1220.108  Department.

    Department means the United States Department of Agriculture.



Sec. 1220.109  Eligible organization.

    The term eligible organization means any organization which has been 
certified by the Secretary pursuant to Sec. 1220.203 of this subpart as 
being eligible to submit nominations for initial membership on the 
Board.



Sec. 1220.110  First purchaser.

    The term first purchaser means--
    (a) except as provided in paragraph (b) of this section, any person 
buying or otherwise acquiring from a producer soybeans produced by such 
producer; or
    (b) In any case in which soybeans are pledged as collateral for a 
loan issued under any Commodity Credit Corporation price support loan 
program and the soybeans are forfeited by the producer in lieu of loan 
repayment, the Commodity Credit Corporation.

[56 FR 31049, July 9, 1991, as amended at 56 FR 42923, Aug. 30, 1991; 57 
FR 31095, July 14, 1992]



Sec. 1220.111  Fiscal period.

    The term fiscal period means the calendar year or such other annual 
period as the Board may determine with the approval of the Secretary.



Sec. 1220.112  Industry information.

    The term industry information means information and programs that 
will lead to the development of new markets, new marketing strategies, 
or increased efficiency for the soybean industry, and activities to 
enhance the image of the soybean industry.



Sec. 1220.113  Marketing.

    The term marketing means the sale or other disposition of soybeans 
or soybean products in any channel of commerce.



Sec. 1220.114  National nonprofit producer-governed organization.

    The term national nonprofit producer-governed organization means an 
organization that--
    (a) Is a nonprofit organization pursuant to section 501(c) (3), (5) 
or (6) of the Internal Revenue Code (26 U.S.C. 501(c) (3), (5) and (6)); 
and
    (b) Is governed by a Board of directors of agricultural producers 
representing soybean producers on a national basis;

[[Page 178]]



Sec. 1220.115  Net market price.

    The term net market price means--
    (a) except as provided in paragraph (b) of this section, the sales 
price, or other value received by a producer for soybeans after 
adjustments for any premium or discount based on grading or quality 
factors, as determined by the Secretary; or
    (b) For soybeans pledged as collateral for a loan issued under any 
Commodity Credit Corporation price support loan program, and where the 
soybeans are forfeited by the producer in lieu of loan repayment, the 
principal amount of the loan.

[56 FR 31049, July 9, 1991, as amended at 56 FR 42923, Aug. 30, 1991; 57 
FR 31095, July 14, 1992]



Sec. 1220.116  Part and subpart.

    Part means the Soybean Promotion and Research Order and all rules 
and regulations issued pursuant to the Act and the Order, and the Order 
itself shall be a ``Subpart'' of such part.



Sec. 1220.117  Plans and projects.

    Plans and Projects means promotion, research, consumer information, 
and industry information plans, studies, or projects pursuant to Sec. 
1220.230.



Sec. 1220.118  Person.

    The term person means any individual, group of individuals, 
partnership, corporation, association, cooperative, or any other legal 
entity.



Sec. 1220.119  Producer.

    The term producer means any person engaged in the growing of 
soybeans in the United States who owns, or who shares the ownership and 
risk of loss of, such soybeans.



Sec. 1220.120  [Reserved]



Sec. 1220.121  Promotion.

    The term promotion means any action, including paid advertising, 
technical assistance, and trade servicing activities, to enhance the 
image or desirability of soybeans or soybean products in domestic and 
foreign markets, and any activity designed to communicate to consumers, 
importers, processors, wholesalers, retailers, government officials, or 
other information relating to the positive attributes of soybeans or 
soybean products or the benefits of importation, use, or distribution of 
soybeans and soybean products.



Sec. 1220.122  Qualified State Soybean Board.

    The term Qualified State Soybean Board means a State soybean 
promotion entity that is authorized by State law and elects to be the 
Qualified State Soybean Board for the State in which it operates 
pursuant to Sec. 1220.228(a)(1). If no such entity exists in a State, 
the term Qualified State Soybean Board means a soybean producer-governed 
entity--
    (a) That is organized and operating within a State;
    (b) That receives voluntary contributions and conducts soybean 
promotion, research, consumer information, or industry information 
programs; and
    (c) That meets the criteria, established by the Board and approved 
by the Secretary, relating to the qualifications of such entity to 
perform its duties under this part as determined by the Board, and is 
certified by the Board under Sec. 1220.228(a)(2), with the approval of 
the Secretary.



Sec. 1220.123  Referendum.

    The term Referendum means a referendum, other than referenda defined 
in Sec. 1220.106 and Sec. 1220.124, to be conducted by the Secretary 
pursuant to the Act whereby producers shall be given the opportunity to 
vote to determine whether the continuance of this subpart is favored by 
a majority of producers voting.



Sec. 1220.124  [Reserved]



Sec. 1220.125  Research.

    The term research means any type of study to advance the image, 
desirability, marketability, production, product development, quality, 
or functional or nutritional value of soybeans or soybean products, 
including any research activity designed to identify and analyze 
barriers to export sales of soybeans and soybean products.

[[Page 179]]



Sec. 1220.126  Secretary.

    The term Secretary means the Secretary of Agriculture of the United 
States or any other officer or employee of the Department to whom there 
has been delegated, the authority to act in the Secretary's stead.



Sec. 1220.127  Soybean products.

    The term soybean products means products produced in whole or in 
part from soybeans or soybean byproducts.



Sec. 1220.128  Soybeans.

    The term soybeans means all varieties of Glycine max or Glycine 
soja.



Sec. 1220.129  State and United States.

    The terms State and United States include the 50 States of the 
United States of America, the District of Columbia, and the Commonwealth 
of Puerto Rico.



Sec. 1220.130  Unit.

    The term unit shall mean each State, or group of States, which is 
represented on the Board.

                          United Soybean Board



Sec. 1220.201  Membership of board.

    (a) For the purposes of nominating and appointing producers to the 
Board, the United States shall be divided into 30 geographic units and 
the number of Board members from each unit, subject to paragraphs (d) 
and (e) of this section shall be as follows:

------------------------------------------------------------------------
                                                                  No. of
                              Unit                               members
------------------------------------------------------------------------
Illinois.......................................................       4
Iowa...........................................................       4
Minnesota......................................................       4
Indiana........................................................       4
Missouri.......................................................       3
Ohio...........................................................       3
Arkansas.......................................................       3
Nebraska.......................................................       3
South Dakota...................................................       3
Kansas.........................................................       3
Michigan.......................................................       3
Mississippi....................................................       2
Louisiana......................................................       2
Tennessee......................................................       2
North Carolina.................................................       2
Kentucky.......................................................       2
North Dakota...................................................       2
Wisconsin......................................................       2
Maryland.......................................................       2
Virginia.......................................................       1
Georgia........................................................       1
South Carolina.................................................       1
Alabama........................................................       1
Delaware.......................................................       1
Texas..........................................................       1
Pennsylvania...................................................       1
Oklahoma.......................................................       1
New York.......................................................       1
Eastern Region (New Jersey, Massachusetts, Connecticut,               1
 Florida, Rhode Island, Vermont, New Hampshire, Maine, West
 Virginia, District of Columbia, and Puerto Rico)..............
Western Region (Montana, Wyoming, Colorado, New Mexico, Idaho,        1
 Utah, Arizona, Washington, Oregon, Nevada, California, Hawaii,
 and Alaska)...................................................
------------------------------------------------------------------------

    (b) The Board shall be composed of soybean producers appointed by 
the Secretary from nominations submitted pursuant to Sec. 1220.203. A 
soybean producer may only be nominated by the unit in which that soybean 
producer is a resident or producer.
    (c) At the end of each three (3) year period, the Board shall review 
the geographic distribution of soybean production volume throughout the 
United States and may recommend to the Secretary a modification of 
paragraph (e) of this section, to best reflect the geographic 
distribution of soybean production volume in the United States. The 
Secretary may amend this subpart to make the changes recommended by the 
Board in levels of productions used to determine per unit 
representation. A unit may not, as a result of any modifications under 
this subsection, lose Board seats to which it is entitled at the time 
this subpart is initially issued unless its average annual production, 
as determined under paragraph (e)(6) of this section, declines below the 
levels required for representation, as specified in paragraphs (e) (1) 
through (5) of this section.
    (d) At the end of each three (3) year period, the Secretary shall 
review the volume of production (minus the volume of production for 
which refunds have been paid) of each unit provided representation under 
paragraph (a) of this section, and shall adjust the boundaries of any 
unit and the number of Board members from each such unit to conform with 
the criteria set out in paragraphs (e) (1) through (5) of this section.

[[Page 180]]

    (e) The following formula will be used to determine the number of 
directors for each unit who shall serve on the Board:
    (1)(i) Except as provided in paragraph (e)(1)(ii) of this section, 
each State will be considered as a separate unit.
    (ii) States which do not have annual average soybean production 
equal to or greater than three million (3,000,000) bushels shall be 
grouped, to the extent practicable, into geographically contiguous units 
each of which, to the extent practicable, have a combined annual soybean 
production level which is equal to or greater than three million 
(3,000,000) bushels and each such unit shall be entitled to at least one 
representative on the Board.
    (2) Each unit that has an annual average soybean production of less 
than fifteen million (15,000,000) bushels shall be entitled to one 
representative on the Board.
    (3) Each unit which has an annual average soybean production of 
fifteen million (15,000,000) or more bushels but less than seventy 
million (70,000,000) bushels shall be entitled to two (2) 
representatives on the Board.
    (4) Each unit which has an annual average soybean production of 
seventy million (70,000,000) or more bushels but less than two hundred 
million (200,000,000) bushels shall be entitled to three (3) 
representatives on the Board.
    (5) Each unit which has an annual average soybean production of two 
hundred million (200,000,000) bushels or more shall be entitled to four 
(4) representatives on the Board.
    (6) For the purposes of this section, average annual soybean 
production shall be determined by using the average of the production 
for the State or unit over the five previous years, excluding the year 
in which production was the highest and the year in which production was 
the lowest.
    (f) [Reserved]

[56 FR 31049, July 9, 1991, as amended at 60 FR 29962, June 7, 1995; 60 
FR 58500, Nov. 28, 1995; 62 FR 37489, July 14, 1997; 62 FR 41485, Aug. 
1, 1997; 65 FR 63768, Oct. 25, 2000; 68 FR 57327, Oct. 3, 2003]



Sec. 1220.202  Term of office.

    (a) The members of the Board shall serve for terms of 3 years, 
except that the members appointed to the initial Board shall serve, 
proportionately, for terms of 1, 2, and 3 years.
    (b) Each member shall continue to serve until a successor is 
appointed by the Secretary and has accepted the position.
    (c) No member shall serve more than three consecutive 3-year terms 
in such capacity.



Sec. 1220.203  Nominations.

    All nominations for appointments to the Board under Sec. 1220.204 
shall be made in the following manner:
    (a) After the issuance of this subpart by the Secretary, nominations 
shall be obtained by the Secretary as specified in paragraphs (a), (b), 
and (c) of this section from Qualified State Soybean Boards or for 
initial Board nominations, eligible organizations deemed qualified to 
nominate pursuant to paragraph (f) of the section. A Qualified State 
Soybean Board, or for initial Board nominations, an eligible 
organization shall only submit nominations for positions on the Board 
representing the unit, as established under Sec. 1220.201, in which 
such Qualified State Soybean Board operates.
    (b) If the Secretary determines that a unit is not represented by a 
Qualified State Soybean Board or for initial Board nominations, an 
eligible organization, then the Secretary may solicit nominations from 
organizations which represent producers in that unit and from producers 
residing in that unit. A caucus may be held in such units for the 
purpose of collectively submitting nominations to the Secretary.
    (c) Where there is more than one State comprising a unit, the 
Secretary shall take into consideration the nominations submitted by 
Qualified State Soybean Boards or for initial Board nominations, 
eligible organizations, within the unit. A caucus may be held in such 
units for the purpose of collectively submitting nominations to the 
Secretary. The Secretary shall consider the proportional levels of 
production in each State comprising the unit when appointing members to 
the Board representing that unit.
    (d) At least two nominations shall be submitted for each position to 
be filled.

[[Page 181]]

    (e) Nominations may be submitted in order of preference and for the 
initial Board, in order of preference for staggered terms. Should the 
Secretary reject any nomination submitted and there are insufficient 
nominations submitted from which appointments can be made, the Secretary 
may request additional nominations under paragraph (a) or (b) of this 
section, whichever provision is applicable for such unit.
    (f) Any organization authorized pursuant to State law to collect 
assessments from producers may notify the Secretary of the 
organization's intent to nominate members to the initial Board for the 
State or unit, as established under Sec. 1220.201, in which such 
organization operates and is authorized by State law. Such eligibility 
shall be based only upon the criteria established pursuant to Sec. 
1220.228(a)(1). There shall only be one organization authorized per 
State pursuant to this section to submit nominations to the initial 
Board. If no such entity exists in a State, any organization meeting 
those requirements of Sec. 1220.228(a)(2) may request eligibility to 
submit nominations.



Sec. 1220.204  Appointment.

    From the nominations made pursuant to Sec. 1220.203, the Secretary 
shall appoint the members of the Board on the basis of representation 
provided for in Sec. 1220.201.



Sec. 1220.205  Nominee's agreement to serve.

    Any producer nominated to serve on the Board shall file with the 
Secretary at the time of nomination a written agreement to:
    (a) Serve on the Board if appointed; and
    (b) Agree to disclose any relationship with any soybean promotion 
entity or with any organization that has or is being considered for a 
contractual relationship with the Board.



Sec. 1220.206  Vacancies.

    To fill any vacancy occasioned by the death, removal, resignation, 
or disqualification of any member of the Board, the Secretary shall 
request nominations for a successor pursuant to Sec. 1220.203, and such 
successor shall be appointed pursuant to Sec. 1220.204.



Sec. 1220.207  Alternate members.

    (a) The Secretary shall solicit, pursuant to the procedures of Sec. 
1220.203, nominations for alternate members of the Board.
    (b) The Secretary shall appoint one alternate member of the Board 
for each unit which has only one member pursuant to Sec. 1220.204 and 
Sec. 1220.205.
    (c) Alternate members of the Board may attend meetings of the Board 
as a voting member upon the following circumstances:
    (1) A member of the Board for the unit which the alternate member 
represents is absent; and
    (2) Such member, or in the case of incapacitation or death of the 
member, a relative, has contacted the appropriate officer of the Board 
to inform such officer of such absence;
    (d) An alternate member of the Board, when attending Board meetings 
in an official capacity, shall have the rights, duties and obligations 
of a Board member.



Sec. 1220.208  Removal.

    If the Secretary determines that any person appointed under this 
part fails or refuses to perform his or her duties properly or engages 
in acts of dishonesty or willful misconduct, the Secretary shall remove 
the person from office. A person appointed or certified under this part 
or any employee of the Board or Committee may be removed by the 
Secretary if the Secretary determines that the person's continued 
service would be detrimental to the purposes of the Act.



Sec. 1220.209  Procedure.

    (a) At a properly convened meeting of the Board, a majority of the 
members shall constitute a quorum.
    (b)(1) Except for roll call votes, each member of the Board will be 
entitled to one vote on any matter put to the Board and the motion will 
carry if supported by a simple majority of those voting.
    (2)(i) If a member requests a roll call vote, except as provided in 
paragraph (b)(2)(ii) of this section, each unit as established under 
Sec. 1220.201, shall cast

[[Page 182]]

one vote for each percent, or portion of a percent, of the average total 
amount of assessments remitted to the Board that was remitted from the 
unit (minus refunds) during each of the three previous fiscal years of 
the Board under Sec. 1220.223.
    (ii)(A) During the first fiscal year of the Board, the percentage 
used to determine the votes given to a unit will be based on annual 
average soybean production of the three previous years. If a unit is 
represented by more than one member, each member representing the unit 
shall receive an equal percentage of the votes allocated to the unit.
    (B) During the second and third year this subpart is in effect, the 
percentage used to determine the votes given to a unit will be based 
upon averaging the unit's percentage of annual assessments remitted to 
the Board (minus refunds).
    (iii) Should a member representing a unit not be present, then the 
other members representing such unit shall vote, on an equal basis if 
there is more than one member representing the unit present, the number 
of votes which the absent member would have been entitled to vote.
    (iv) A motion will carry on a roll call vote if approved by both a 
simple majority of all votes cast and a simple majority of all units 
voting (with the vote of each unit determined by a simple majority of 
all votes cast by members in that unit).
    (3) A member may not cast votes by proxy.
    (c) In lieu of a properly convened meeting and, when in the opinion 
of the chairperson of the Board such action is considered necessary, the 
Board may take action upon the concurring votes of a majority of its 
members, or if a roll call vote is requested, a simple majority of all 
votes cast and a simple majority of all units voting by mail, telephone, 
facsimile, or telegraph, but any such action by telephone shall be 
confirmed promptly in writing. In the event that such action is taken, 
all members must be notified and provided the opportunity to vote. Any 
action so taken shall have the same force and effect as though such 
action had been taken at a regular or special meeting of the Board.
    (d) On or after the end of the three-year period beginning on the 
effective date of this subpart, the Board may recommend to the Secretary 
changes in the voting procedures of the Board described in paragraph (b) 
of this section.



Sec. 1220.210  Compensation and reimbursement.

    The members of the Board shall serve without compensation but shall 
be reimbursed for necessary and reasonable expenses incurred by them in 
the performance of their responsibilities under this subpart.



Sec. 1220.211  Powers of the Board.

    The Board shall have the following powers:
    (a) To receive and evaluate, or on its own initiative develop, and 
budget for plans or projects for promotion, research, consumer 
information, and industry information and to make recommendations to the 
Secretary regarding such proposals;
    (b) To administer the provisions of this subpart in accordance with 
its terms and provisions;
    (c) To make rules to effectuate the terms and provisions of this 
subpart;
    (d) To receive, investigate, and report to the Secretary complaints 
of violations of the provisions of this subpart;
    (e) To disseminate information to producers or producer 
organizations through programs or by direct contact utilizing the public 
postage system or other systems;
    (f) To assign responsibilities relating to budget and program 
development to the Committee as provided in Sec. 1220.219.
    (g) To select committees and subcommittees of Board members, and to 
adopt such rules for the conduct of its business as it may deem 
advisable;
    (h) To contract with Qualified State Soybean Boards to implement 
plans or projects;
    (i) To recommend to the Secretary amendments to this subpart; and
    (j) With the approval of the Secretary, to invest, pending 
disbursement pursuant to a plan or project, funds

[[Page 183]]

collected through assessments authorized under Sec. 1220.223 in, and 
only in, obligations of the United States or any agency thereof, in 
general obligations of any State or any political subdivision thereof, 
in any interest-bearing account or certificate of deposit of a bank 
which is a member of the Federal Reserve System, or in obligations fully 
guaranteed as to principal and interest by the United States.



Sec. 1220.212  Duties.

    The Board shall have the following duties:
    (a) To meet not less than three times annually, or more often if 
required for the Board to carry out its responsibilities pursuant to 
this subpart.
    (b) To organize and select from among its members a chairperson, 
vice chairperson, a treasurer and such other officers as may be 
necessary.
    (c) To appoint from its members an executive committee and to 
delegate to the committee authority to administer the terms and 
provisions of this subpart under the direction of the Board and within 
the policies determined by the Board.
    (d) To employ or contract for such persons to perform administrative 
functions as it may deem necessary and define the duties and determine 
the compensation of each.
    (e) To develop and submit to the Secretary for approval, promotion, 
research, consumer information, and industry information plans or 
projects.
    (f) To prepare, and submit to the Secretary for approval, budgets on 
a fiscal period basis of its anticipated expenses and disbursements in 
the administration of this subpart, including probable costs of 
promotion, research, consumer information, and industry information 
plans or projects, and also including a description of the proposed 
promotion, research, consumer information, and industry information 
programs contemplated therein.
    (g) To maintain such books and records, which shall be available to 
the Secretary for inspection and audit, and to prepare and submit such 
reports from time to time to the Secretary, as the Secretary may 
prescribe, and to make appropriate accounting with respect to the 
receipt and disbursement of all funds entrusted to it.
    (h) With the approval of the Secretary, to enter into contracts or 
agreements with appropriate parties, including national nonprofit 
producer-governed organizations, for the development and conduct of 
activities authorized under Sec. 1220.230 of this subpart and for the 
payment of the cost thereof with funds collected through assessments 
pursuant to Sec. 1220.223. Provided, that the Board shall contract with 
only one national nonprofit producer-governed organization to administer 
all projects within a program area.
    Any such contract or agreement shall provide that:
    (1) The contractor shall develop and submit to the Board a plan or 
project together with a budget or budgets which shall show the estimated 
cost to be incurred for such plan or project;
    (2) Any such plan or project shall become effective only upon 
approval of the Secretary; and
    (3) The contracting party shall keep complete and accurate records 
of all of its transactions and make periodic reports to the Board of 
activities conducted pursuant to a contract and an accounting for funds 
received and expended, and such other reports as the Secretary or the 
Board may require. The Board and Secretary may audit the records of the 
contracting party periodically.
    (i) To prepare and make public, at least annually, a report of its 
activities carried out and an accounting for funds received and 
expended.
    (j) [Reserved]
    (k) To cause its books to be audited by a certified public 
accountant at least once each fiscal period and at such other times as 
the Secretary may require and to submit a copy of each such audit to the 
Secretary.
    (l) To give the Secretary the same notice of meetings of the Board 
and committees as is given to members in order that the Secretary, or a 
representative of the Secretary, may attend such meetings.
    (m) To submit to the Secretary such information pursuant to this 
subpart as may be requested.

[[Page 184]]

    (n) To encourage the coordination of programs of promotion, 
research, consumer information, and industry information designed to 
strengthen the soybean industry's position in the marketplace and to 
maintain and expand domestic and foreign markets and uses for soybean 
and soybean products produced in the United States.

[56 FR 31049, July 9, 1991, as amended at 60 FR 29962, June 7, 1995; 60 
FR 58500, Nov. 28, 1995]

                 Soybean Program Coordinating Committee



Sec. 1220.213  Establishment and membership.

    (a) The Board may establish, with the approval of the Secretary, a 
Soybean Program Coordinating Committee to assist in the administration 
of this subpart. The Committee shall consist of 15 members. The 
Committee shall be composed of 10 Board members elected by the Board and 
5 producers elected by the Cooperator Organization.
    (b) Board representation on the Committee shall consist of the 
Chairperson and Treasurer of the Board, and eight additional members 
duly elected by the Board to serve on the Committee. The eight 
representatives to the Committee elected by the Board shall, to the 
extent practicable, reflect the geographic and unit distribution of 
soybean production.
    (c) Cooperator Organization representation on the Committee shall 
consist of five members elected by the Cooperator Organization Board of 
Directors. The Cooperator Organization shall submit to the Secretary the 
names of the representatives elected by the Cooperator Organization to 
serve on the Committee, the manner in which such election was held, and 
verify that such representatives are producers. The prospective 
Cooperator Organization representatives shall file with the Secretary a 
written agreement to serve on the Committee and to disclose any 
relationship with any soybean entity or with any organization that has 
or is being considered for a contractual relationship with the Board. 
When the Secretary is satisfied that the above conditions are met, the 
Secretary shall certify such representatives as eligible to serve on the 
Committee.



Sec. 1220.214  Term of office.

    (a) The members of the Committee shall serve for a term of 1 year.
    (b) No member shall serve more than six consecutive terms.



Sec. 1220.215  Vacancies.

    To fill any vacancy occasioned by the death, removal, resignation, 
or disqualification of any member of the Committee, the Board or the 
Cooperator Organization, depending upon which organization is 
represented by the vacancy, shall submit the name of a successor for the 
position in the manner utilized to appoint representatives pursuant to 
Sec. 1220.213 above.



Sec. 1220.216  Procedure.

    (a) Attendance of at least 12 members of the Committee shall 
constitute a quorum at a properly convened meeting of the Committee. Any 
action of the Committee shall require the concurring votes of at least 
two-thirds (\2/3\) of the members present. The Committee shall establish 
rules concerning timely notice of meetings.
    (b) When in the opinion of the chairperson of the Committee 
emergency action must be taken before a meeting can be called, the 
Committee may take action upon the concurring votes of no less than 
twelve of its members by mail, telephone, facsimile, or telegraph. 
Action taken by this emergency procedure is valid only if all members 
are notified and provided the opportunity to vote and any telephone vote 
is confirmed promptly in writing. Any action so taken shall have the 
same force and effect as though such action had been taken at a properly 
convened meeting of the Committee.
    (c) A member may not cast votes by proxy.



Sec. 1220.217  Compensation and reimbursement.

    The members of the Committee shall serve without compensation but 
shall be reimbursed by the Board for necessary and reasonable expenses 
incurred by them in the performance of their responsibilities under this 
subpart.

[[Page 185]]



Sec. 1220.218  Officers of the Committee.

    The following persons shall serve as officers of the Committee:
    (a) The Chairperson of the Board shall be Chairperson of the 
Committee.
    (b) The Committee shall elect or appoint such other officers as it 
may deem necessary.



Sec. 1220.219  Powers of the Committee.

    If established by the Board, the Committee may have the following 
powers:
    (a) To receive and evaluate, or on its own initiative, develop and 
budget for plans or projects to promote the use of soybeans and soybean 
products as well as plans or projects for promotion, research, consumer 
information, and industry information and to make recommendations to the 
Board regarding such proposals; and
    (b) To select committees and subcommittees of Committee members, and 
to adopt such rules for the conduct of its business as it may deem 
advisable.



Sec. 1220.220  Duties of the Committee.

    If established by the Board, the Committee may have the following 
duties:
    (a) To meet and to organize;
    (b) To prepare and submit to the Board for approval, budgets on a 
fiscal period basis of proposed costs of promotion, research, consumer 
information, and industry information plans or projects, and also 
including a general description of the proposed promotion, research, 
consumer information, and industry information programs contemplated 
therein;
    (c) To give the Secretary the same notice of meetings of the 
Committee and its subcommittees as is given to members in order that the 
Secretary, or the Secretary's representative, may attend such meetings;
    (d) To submit to the Board and to the Secretary such information 
pursuant to this subpart as may be requested; and
    (e) To encourage the coordination of programs of promotion, 
research, consumer information, and industry information designed to 
strengthen the soybean industry's position in the marketplace and to 
maintain and expand domestic and foreign markets and uses for soybeans 
and soybean products.

                        Expenses and Assessments



Sec. 1220.222  Expenses.

    (a) The Board is authorized to incur such expenses (including 
provision for a reasonable reserve) as the Secretary finds are 
reasonable and likely to be incurred by the Board for its maintenance 
and functioning and to enable it to exercise its powers and perform its 
duties in accordance with the provisions of this subpart. However, 
during any fiscal year, expenses incurred by the Board for 
administrative staff costs and their benefits shall not exceed l percent 
of the projected level of assessments, net of projected refunds, of the 
Board for that fiscal year. Such expenses shall be paid from assessments 
received pursuant to Sec. 1220.223. The administrative expenses of the 
Board, including the cost of administrative staff, shall not exceed 5 
percent of the projected level of assessments, net of projected refunds, 
of the Board for that fiscal year.
    (b) The Board shall reimburse the Secretary, from assessments 
received pursuant to Sec. 1220.223, for administrative costs incurred 
after an Order has been submitted to the Department pursuant to section 
1968(b) of the Act; Provided, that the Board shall only be required to 
reimburse the Secretary for one-half (50%) of the costs incurred by the 
Secretary to conduct the refund referendum relating to continuation of 
authority to pay refunds.
    (c)(1) The Board may, with the approval of the Secretary, authorize 
a credit to Qualified State Soybean Boards of up to 5 percent of the 
amount to be remitted to the Board pursuant to Sec. 1220.223 and Sec. 
1220.228 of this subpart to offset collection and compliance costs 
relating to such assessments and for fees paid to State governmental 
agencies or first purchasers for collection of the assessments where the 
payment of such fees by the Qualified State Soybean Board is required by 
State law enacted prior to November 28, 1990.
    (2) The portion of the credit authorized in paragraph (c)(1) of this 
section which compensates Qualified State Soybean Boards for fees paid 
to State

[[Page 186]]

governmental agencies or first purchasers for collection of the 
assessments where the payment of such fees by the Qualified State 
Soybean Board is required by State law enacted prior to November 28, 
1990:
    (i) Shall not exceed one-half of such fees paid to State 
governmental agencies or first purchasers, and;
    (ii) Shall not exceed 2.5 percent of the amount of assessments 
collected and remitted to the Board.
    (3) Except for that portion of the credit issued pursuant to 
paragraph (c)(2) of this section, credits authorized by paragraph (c)(1) 
of this section will be included as part of the Board's administrative 
expenses.



Sec. 1220.223  Assessments.

    (a)(1) Except as prescribed by regulations approved by the Secretary 
or as otherwise provided in this section, each first purchaser of 
soybeans shall collect an assessment from the producer, and each 
producer shall pay such assessment to the first purchaser, at the rate 
of one-half of one percent (0.5%) of the net market price of the 
soybeans purchased. Each first purchaser shall remit such assessment to 
the Board or to a Qualified State Soybean Board, as provided in 
paragraph (a)(5) of this section.
    (2) Any producer marketing processed soybeans or soybean products of 
that producer's own production, shall remit to a Qualified State Soybean 
Board or to the Board, as provided in paragraph (a)(5) of this section, 
an assessment on such soybeans or soybean products at a rate of one-half 
of one percent (0.5%) of the net market price of the soybeans involved 
or the equivalent thereof.
    (3) In determining the assessment due from each producer under 
paragraph (a)(1) or (a)(2) of this section, a producer who is 
contributing to a Qualified State Soybean Board shall receive a credit 
from the Board for contributions to such Qualified State Soybean Board 
on any soybeans assessed under this section in an amount not to exceed 
one-quarter of one percent of the net market price of the soybeans 
assessed.
    (4) In order for a producer to receive the credit provided for in 
paragraph (a)(3) of this section, the Qualified State Soybean Board or 
the first purchaser must establish to the satisfaction of the Board that 
the producer has contributed to a Qualified State Soybean Board.
    (5)(i) If the soybeans, for which an assessment is paid, were grown 
in a State other than the State which is the situs of the first 
purchaser, the first purchaser that collects the assessment shall remit 
the assessment and information as to the State of origin of the soybeans 
to the Qualified State Soybean Board operating in the State in which the 
first purchaser is located. The Qualified State Soybean Board operating 
in the State in which the first purchaser is located shall remit such 
assessments to the Qualified State Soybean Board operating in the State 
in which the soybeans were grown. If no such Qualified State Soybean 
Board exists in such State, then the assessments shall be remitted to 
the Board. The Board, with the approval of the Secretary, may authorize 
Qualified State Soybean Boards to propose modifications to the foregoing 
``State of Origin'' rule to ensure effective coordination of assessment 
collections between Qualified State Soybean Boards.
    (ii)(A) If a producer pledges soybeans grown by that producer as 
collateral for a loan issued by the Commodity Credit Corporation and if 
that producer forfeits said soybeans in lieu of loan repayment, the 
Commodity Credit Corporation shall at the time of the loan settlement, 
collect from the producer the assessments due based on 0.5 percent of 
the principal loan amount received by the producer and remit the 
assessment to the Qualified State Soybean Board in the State in which 
the soybeans were pledged, or if no Qualified State Soybean Board exists 
in such State, the Board.
    (B) If a producer redeems and subsequently markets soybeans which 
have been pledged as collateral for a loan issued by the Commodity 
Credit Corporation, the first purchaser shall collect and remit the 
assessments due pursuant to paragraph (a)(1) of this section; or if a 
producer markets such soybeans as processed soybeans or as soybean 
products, the producer shall remit

[[Page 187]]

the assessment pursuant to paragraph (a)(2) of this section.
    (iii) Qualified State Soybean Boards and the Board shall coordinate 
assessment collection procedures to ensure that producers marketing 
soybeans are required to pay only one assessment per bushel of soybeans 
and collections are adjusted among States on a mutually agreeable basis.
    (b) The collection of assessments pursuant to paragraph (a) of this 
section, shall commence on and after the date assessments are required 
to be paid and shall continue until terminated by the Secretary. If the 
Board is not constituted on the date the first assessments are to be 
collected, the Secretary shall have the authority to receive the 
assessments on behalf of the Board, and to hold such assessments until 
the Board is constituted, then remit such assessments to the Board.
    (c)(1) Each person responsible for the collection of assessments 
under paragraph (a) of this section, shall collect and remit the 
assessments to the Board or a Qualified State Soybean Board on a monthly 
basis or as required by State law, but no less than quarterly, unless 
the Board, with the approval of the Secretary, has specifically 
authorized otherwise.
    (2) Any unpaid assessments due the Board or a Qualified State 
Soybean Board from a person responsible for remitting assessments to the 
Board or a Qualified State Soybean Board pursuant to paragraph (a) of 
this section, shall be increased two percent (2%) each month beginning 
with the day following the date such assessments were due under this 
subpart. Any remaining amount due shall be increased at the same rate on 
the corresponding day of each month thereafter until paid.
    (3) The amounts payable pursuant to this section shall be computed 
monthly on unpaid assessments and shall include any unpaid late charges 
previously applied pursuant to this section.
    (4) For the purpose of this section, any assessment that was 
determined at a date later than prescribed by this subpart because of a 
person's failure to submit a report to the Board or a Qualified State 
Soybean Board when due, shall be considered to have been payable by the 
date it would have been due if the report had been filed when due.
    (d) Prior to the continuance referendum, the Board, pursuant to 
procedures approved by the Secretary, shall ensure that each Qualified 
State Soybean Board is provided credit in accordance with the provisions 
of section 1969(n)(1) and subject to section 1969(n)(3) of the Act.
    (e) Following the continuance referendum, the Board, pursuant to 
procedures approved by the Secretary, shall ensure annually that each 
Qualified State Soybean Board is provided credit in accordance with the 
provisions of section 1969(n)(2) and subject to section 1969(n)(3) of 
the Act.

[56 FR 31049, July 9, 1991, as amended at 56 FR 42923, Aug. 30, 1991; 57 
FR 31096, July 14, 1992]



Sec. Sec. 1220.224-1220.227  [Reserved]



Sec. 1220.228  Qualified State Soybean Boards.

    (a)(1) Any soybean promotion entity that is authorized by State 
statute to collect assessments required by State law from soybean 
producers may notify the Board of its election to be the Qualified State 
Soybean Board for the State in which it operates so that producers may 
receive credit pursuant to Sec. 1220.223(a)(3) for contributions to 
such organization. Only one such entity may make such election or be 
qualified pursuant to paragraph (a)(2) of this section. Such entity, 
upon making such election, agrees to the following:
    (i) To conduct activities as defined in Sec. 1220.230 that are 
intended to strengthen the soybean industry's position in the 
marketplace;
    (ii) Provide a report describing the manner in which assessments are 
collected and the procedure utilized to ensure that assessments due are 
paid;
    (iii) Collect assessments paid on soybeans marketed within the State 
and establish procedures for ensuring compliance with this subpart with 
regard to the payment of such assessments;
    (iv) Remit to the Board each assessment paid and remitted to it, 
minus authorized credits issued pursuant to Sec. 1220.222(c) and 
credits issued to producers pursuant to Sec. 1220.223(a)(3), and

[[Page 188]]

other required deductions by the last day of the month following the 
month in which the assessment was remitted to it unless the Board 
determines a different date for remittance of assessments;
    (v)-(vi) [Reserved]
    (vii) Furnish the Board with an annual report by a certified public 
accountant or an authorized State agency of all funds remitted to such 
Board pursuant to this subpart; and
    (viii) Not use funds it collects pursuant to this subpart to fund 
plans or projects which make use of any unfair or deceptive acts or 
practices with respect to the quality, value or use of any product that 
competes with soybeans or soybean products; and
    (ix)(A) Except as otherwise provided in paragraph (a)(1)(ix)(B) of 
this section, funds collected or received by the Qualified State Soybean 
Board under this subpart shall not be used in any manner for the purpose 
of influencing any action or policy of the United States Government, any 
foreign or State government, or any political subdivision thereof.
    (B) The prohibition in paragraph (a)(1)(ix)(A) of this section, 
shall not apply to--
    (1) The communication to appropriate government officials of 
information relating to the conduct, implementation, or results of 
promotion, research, consumer information, and industry information 
under the Order;
    (2) Any action designed to market soybeans or soybean products 
directly to a foreign government or political subdivision thereof; or
    (3) The development and recommendation of amendments to this 
subpart.
    (2) If no entity elects to serve as a Qualified State Soybean Board 
within a State pursuant to paragraph (a)(1) of this section, any State 
soybean promotion entity that is organized and operating within a State, 
and receives assessments or contributions from producers and conducts 
soybean or soybean product promotion, research, consumer information, or 
industry information programs, may apply for certification as the 
Qualified State Soybean Board for such State so that producers may 
receive credit pursuant to Sec. 1220.223(a)(3) for contributions to 
such organizations. All provisions of this subpart applicable to 
Qualified State Soybean Boards will be applicable to such entity. The 
Board shall review such applications for certification and shall make a 
determination as to the certification of each applicant.
    (b) In order for the State soybean entity to be certified by the 
Board pursuant to paragraph (a)(2) of this section, as a Qualified State 
Soybean Board, the entity must:
    (1) Conduct activities as defined in Sec. 1220.230 that are 
intended to strengthen the soybean industry's position in the 
marketplace;
    (2) Submit to the Board a report describing the manner in which 
assessments are collected and the procedure utilized to ensure that 
assessments due are paid;
    (3) Certify to the Board that such State entity will collect 
assessments paid on soybeans marketed within the State and establish 
procedures for ensuring compliance with this subpart with regard to the 
payment of such assessments;
    (4) Certify to the Board that such organization will remit to the 
Board each assessment paid and remitted to it, minus credits issued 
pursuant to Sec. 1220.222(c) and authorized credits issued to producers 
pursuant to Sec. 1220.223(a)(3), and other required deductions by the 
last day of the month following the month in which the assessment was 
remitted to it unless the Board determines a different date for 
remittance of assessments;
    (5)-(6) [Reserved]
    (7) Certify to the Board that it will furnish the Board with an 
annual report by a certified public accountant or an authorized State 
agency of all funds remitted to such Board pursuant to this subpart; and
    (8) Not use funds it collects pursuant to this subpart to fund plans 
or projects which make use of any unfair or deceptive acts or practices 
with respect to the quality, value or use of any product that competes 
with soybeans or soybean products; and
    (9)(i) Except as otherwise provided in paragraph (b)(9)(ii) of this 
section, funds collected or received by the Qualified State Soybean 
Board under

[[Page 189]]

this subpart shall not be used in any manner for the purpose of 
influencing any action or policy of the United States Government, any 
foreign or State government, or any political subdivision thereof.
    (ii) The prohibition in paragraph (b)(9)(i) of this section, shall 
not apply to--
    (A) The communication to appropriate government officials of 
information relating to the conduct, implementation, or results of 
promotion, research, consumer information, and industry information 
under this subpart;
    (B) Any action designed to market soybeans or soybean products 
directly to a foreign government or political subdivision thereof; or
    (C) The development and recommendation of amendments to this 
subpart.
    (c) Notwithstanding any other provisions of this subpart, and 
provided that activities of a Qualified State Soybean Board are 
authorized under the Act and this subpart, the Board shall not have the 
authority to:
    (1) Establish guidelines, regulations, or rules which would restrict 
or infringe upon a Qualified State Soybean Board's authority to 
determine administrative or program expenditure allocations or 
administrative or program implementation; and
    (2) Direct Qualified State Soybean Boards to participate or not 
participate in program activities or implementation.
    (d) The Board shall establish procedures, after an opportunity for 
public comment and subject to approval of the Secretary, which provide 
Qualified State Soybean Boards with a right to present information to 
the Board prior to any determinations relating to nonparticipation as a 
Qualified State Soybean Board following initial election or 
determination as a Qualified State Soybean Board.

[56 FR 31049, July 9, 1991, as amended at 60 FR 58500, Nov. 28, 1995; 61 
FR 50694, Sept. 27, 1996]



Sec. 1220.229  Influencing governmental action.

    (a) Except as otherwise provided in paragraph (b) of this section, 
funds collected or received by the Board under this subpart shall not be 
used in any manner for the purpose of influencing any action or policy 
of the United States Government, any foreign or State government, or any 
political subdivision thereof.
    (b) The prohibition in paragraph (a) of this section shall not apply 
to--
    (1) The development and recommendation of amendments to this 
subpart;
    (2) The communication to appropriate government officials of 
information relating to the conduct, implementation, or results of 
promotion, research, consumer information, and industry information 
under this subpart; or
    (3) Any action designed to market soybeans or soybean products 
directly to a foreign government or political subdivision thereof.



Sec. 1220.230  Promotion, research, consumer information, and industry 
information.

    (a) The Board shall receive and evaluate, or on its own initiative, 
develop and submit to the Secretary for approval any plans or projects 
authorized in this subpart. Such plans or projects shall provide for:
    (1) The establishment, issuance, effectuation, and administration of 
appropriate promotion, research, consumer information, and industry 
information activities with respect to soybean and soybean products;
    (2) The establishment and conduct of research, and studies with 
respect to the sale, distribution, marketing and utilization of soybean 
and soybean products and the creation of new products thereof, to the 
end that marketing and utilization of soybean and soybean products may 
be encouraged, expanded, improved or made more acceptable; and
    (3) Such other activities as are authorized by the Act and this 
subpart.
    (b) Each plan or project described in paragraph (a) of this section, 
shall be periodically reviewed or evaluated by the Board to ensure that 
each such plan or project contributes to an effective program of 
promotion, research, consumer information, and industry information. If 
it is found by the Board that any such plan or project does not

[[Page 190]]

further the purposes of the Act, then the Board shall terminate such 
plan or project.
    (c) No such plans or projects shall make use of unfair or deceptive 
acts or practices with respect to the quality, value or use of any 
competing product. In carrying out any plan or project funded by the 
Board described in paragraph (a) of this section, no preference shall be 
given to a brand or trade name of any soybean product without the 
approval of the Board and the Secretary.

                       Reports, Books, and Records



Sec. 1220.241  Reports.

    Each producer marketing processed soybeans or soybean products of 
that producer's own production and each first purchaser responsible for 
the collection of assessments under Sec. 1220.223 shall be required to 
report to the Board periodically such information as may be required by 
the regulations recommended by the Board and approved by the Secretary. 
Such information may include but not be limited to the following:
    (a) The number of bushels of soybeans purchased, initially 
transferred, or which, in any other manner, is subject to the collection 
of assessment;
    (b) The amount of assessments remitted;
    (c) The basis, if necessary, to show why the remittance is less than 
one-half percent (0.5%) of the net market price per bushel of soybeans 
purchased multiplied by the number of bushels purchased; and
    (d) The date any assessment was paid.



Sec. 1220.242  Books and records.

    (a) Except as provided in paragraph (b) of this section, each person 
who is subject to this subpart shall maintain and make available for 
inspection by the Board or Secretary such books and records as are 
necessary to carry out the provisions of this subpart and the 
regulations issued under this part, including such records as are 
necessary to verify any reports required. Such records shall be retained 
for at least two years beyond the fiscal period of their applicability.
    (b) Any producer who plants less than 25 acres of soybeans annually 
and does not market such soybeans shall not be required to maintain 
books or records pursuant to this subpart.



Sec. 1220.243  Confidential treatment.

    Except as otherwise provided in the Act, financial or commercial 
information that is obtained under the Act and this subpart and that is 
privileged and confidential shall be kept confidential by all persons, 
including employees and former employees of the Board, all officers and 
employees and all former officers and employees of the Department, and 
by all officers and employees and all former officers and employees of 
contracting agencies having access to such information, and shall not be 
available to Board members or any other producers. Only those persons 
having a specific need for such information in order to effectively 
administer the provisions of this part shall have access to such 
information.

                              Miscellaneous



Sec. 1220.251  Proceedings after termination.

    (a) Upon the termination of this subpart, the Board shall recommend 
not more than five of its members to the Secretary to serve as trustees 
for the purpose of liquidating the affairs of the Board. Such persons, 
upon designation by the Secretary, shall become trustees of all the 
funds and property, owned, in the possession of or under the control of 
the Board, including any unpaid claims or property not delivered or any 
other claims existing at the time of such termination.
    (b) The trustees shall:
    (1) Continue in such capacity until discharged by the Secretary;
    (2) Carry out the obligations of the Board under any contract or 
agreements entered into by it pursuant to Sec. 1220.212(h);
    (3) From time to time account for all receipts and disbursements; 
and
    (4) Deliver all property on hand, together with all books and 
records of the Board and of the trustees, to such persons as the 
Secretary may direct, and upon the request of the Secretary,

[[Page 191]]

execute such assignments or other instruments necessary or appropriate 
to vest in such persons full title and right to all of the funds, 
property, and claims vested in the Board or the trustees pursuant to 
this subpart.
    (c) Any person to whom funds, property, or claims have been 
transferred or delivered pursuant to this subpart shall be subject to 
the same obligation imposed upon the Board and upon the trustees.
    (d) Any residual funds not required to defray the necessary expenses 
of liquidation shall be turned over to the Secretary to be used, to the 
extent practicable, in the interest of continuing one or more of the 
promotion, research, consumer information, or industry information plans 
or projects authorized pursuant to this subpart.



Sec. 1220.252  Effect of termination or amendment.

    Unless otherwise expressly provided by the Secretary, the 
termination of this subpart or of any rule issued pursuant hereto, or 
the issuance of any amendment to either thereof, shall not:
    (a) Affect or waive any right, duty, obligation, or liability which 
shall have arisen or which may hereafter arise in connection with any 
provision of this subpart or any regulation issued thereunder;
    (b) Release or extinguish any violation of this subpart or any 
regulation issued thereunder; or
    (c) Affect or impair any rights or remedies of the United States, or 
of the Secretary, or of any person, with respect to any such violation.



Sec. 1220.253  Personal liability.

    No member, employee or agent of the Board, including employees, 
agents or board members of Qualified State Soybean Boards, acting 
pursuant to authority provided in this subpart, shall be held personally 
responsible, either individually or jointly, in any way whatsoever, to 
any person for errors in judgment, mistakes, or other acts of either 
commission or omission, of such member or employee, except for acts of 
dishonesty or willful misconduct.



Sec. 1220.254  Patents, copyrights, inventions, and publications.

    (a) Any patents, copyrights, inventions, or publications developed 
through the use of funds remitted to the Board under the provisions of 
this subpart shall be the property of the U.S. Government as represented 
by the Board, and shall, along with any rents, royalties, residual 
payments, or other income from the rental, sale, leasing, franchising, 
or other uses of such patents, copyrights, inventions, or publications, 
inure to the benefit of the Board. Upon termination of this subpart, 
Sec. 1220.251 shall apply to determine disposition of all such 
property.
    (b) Notwithstanding the provisions of paragraph (a) of this section, 
if patents, copyrights, inventions, or publications are developed by the 
use of funds remitted to the Board under this subpart. Should patents, 
copyrights, inventions or publications be developed through the use of 
funds remitted to the Board under this subpart and funds contributed by 
another organization or person, ownership and related rights to such 
patents, copyrights, inventions, or publications shall be determined by 
agreement between the Board and the party contributing funds towards the 
development of such patent, copyright, invention or publication.



Sec. 1220.255  Amendments.

    Amendments to this subpart may be proposed, from time to time, by 
the Board, or by any Qualified State Soybean Board recognized, or by any 
interested person affected by the provisions of the Act, including the 
Secretary.



Sec. 1220.256  Separability.

    If any provision of this subpart is declared invalid or the 
applicability thereof to any person or circumstances is held invalid, 
the validity of the remainder of this subpart of the applicability 
thereof to other persons or circumstances shall not be affected thereby.



Sec. 1220.257  OMB control numbers.

    The control number assigned to the information collection 
requirements by the Office of Management and Budget pursuant to the 
Paperwork Reduction Act, Public Law 96-511, is OMB number

[[Page 192]]

0581-0093, except Board member nominee information sheets are assigned 
OMB number 0505-0001.

[56 FR 31049, July 9, 1991, as amended at 61 FR 50694, Sept. 27, 1996]



                     Subpart B_Rules and Regulations

    Source: 57 FR 29439, July 2, 1992, unless otherwise noted.

                               Definitions



Sec. 1220.301  Terms defined.

    As used throughout this subpart, unless the context otherwise 
requires, terms shall have the same meaning as the definition of such 
terms as appears in subpart A of this part.

                               Assessments



Sec. 1220.310  Assessments.

    (a) A 0.5 percent of the net market price per bushel assessment on 
soybeans marketed shall be paid by the producer of the soybeans in the 
manner designated in Sec. 1220.311.
    (b) If more than one producer shares the proceeds received for the 
soybeans marketed, each such producer is obligated to pay that portion 
of the assessments which is equivalent to each producer's proportionate 
share of the proceeds.
    (c) Failure of the first purchaser to collect the assessment on each 
bushel of soybeans marketed as designated in Sec. 1220.311 shall not 
relieve the producer of the producer's obligation to pay the assessment 
to the appropriate Qualified State Soybean Board or the United Soybean 
Board as required in Sec. 1220.312.



Sec. 1220.311  Collection and remittance of assessments.

    (a) Except as otherwise provided in this section, each first 
purchaser making payment to a producer for soybeans marketed by a 
producer shall collect from that producer at the time of settlement of 
that producer's account an assessment at the rate of 0.5 percent of the 
net market price per bushel of soybeans marketed and shall be 
responsible for remitting the assessment to the Qualified State Soybean 
Board or the United Soybean Board as provided in Sec. 1220.312. The 
first purchaser shall give to the producer a receipt indicating payment 
of the assessment. The receipt shall be any document issued by the first 
purchaser that contains the information requested in Sec. 1220.314(a).
    (b) A first purchaser who purchases soybeans pursuant to a contract 
with a producer, either on a volume basis or on a per acre basis, shall 
be responsible for remitting the assessment due on soybeans purchased as 
required in Sec. 1220.312. Such assessment shall be based upon 0.5 
percent of the net market price specified or established in the contract 
and shall be collected at the time of payment to the producer. If the 
net market price is not specified or established in the contract the 
assessment shall be based on fair market value as specified in paragraph 
(c) of this section below.
    (c) Any producer marketing processed soybeans or soybean products of 
that producer's own production either directly or through retail or 
wholesale outlets shall be responsible for remitting to the Qualified 
State Soybean Board or the United Soybean Board pursuant to Sec. 
1220.312, an assessment on the number of bushels of soybeans processed 
or manufactured into soybean products at the rate 0.5 percent of the net 
market price of the soybeans involved or the equivalent thereof. The 
assessment shall attach upon date of sale of the processed soybeans or 
soybean products and shall be based upon the posted county price for 
soybeans on the date of the sale as posted at the local ASCS office for 
the county in which the soybeans are grown. The producer shall remit the 
assessment in the manner provided in Sec. 1220.312.
    (d) Any producer marketing processed soybeans or soybean products of 
that producer's own production shall be responsible for remitting to the 
Qualified State Soybean Board or the United Soybean Board pursuant to 
Sec. 1220.312, an assessment on the number of bushels of soybeans 
processed or manufactured into soybean products at the rate of 0.5 
percent of the net market price of the soybeans involved or the 
equivalent thereof. The assessment shall attach upon the date of final 
settlement for such processed soybeans or soybean products and shall be 
based

[[Page 193]]

upon the posted county price for soybeans on the date of final 
settlement as posted at the local ASCS office for the county in which 
the soybeans are grown. The producer shall remit the assessment in the 
manner provided in Sec. 1220.312.
    (e) A producer delivering soybeans of the producer's own production 
against a soybean futures contract shall be responsible for remitting an 
assessment at the rate of 0.5 percent of net market price as specified 
in settlement documents. The assessment shall attach at the time of 
delivery and the producer shall remit the assessment due in accordance 
with Sec. 1220.312.
    (f) A producer who forfeits soybeans of that producer's own 
production which were pledged as collateral on a loan issued by 
Commodity Credit Corporation shall pay an assessment. The assessment 
shall attach upon the date the settlement statement is prepared and 
issued to the producer by the Commodity Credit Corporation and shall be 
0.5 percent of the principal amount of the loan for the soybeans as 
specified by Commodity Credit Corporation in the settlement statement. 
The Commodity Credit Corporation shall collect the assessment and then 
remit the assessment due in accordance with Sec. 1220.312.



Sec. 1220.312  Remittance of assessments and submission of reports to 
United Soybean Board or Qualified State Soybean Board.

    (a) Each first purchaser and each producer responsible for the 
remittance of assessments shall remit assessments and submit a report of 
assessments to the Qualified State Soybean Board in the State in which 
each first purchaser or each producer responsible for the remittance of 
assessments is located or if there is no Qualified State Soybean Board 
in such State, then to the United Soybean Board as provided in this 
section.
    (b) First purchasers and producers responsible for remitting 
assessments shall remit assessments and reports on a monthly or 
quarterly basis depending on the State or region in which the first 
purchasers or producers are located. The reporting period for each State 
and region shall be as follows:

------------------------------------------------------------------------
              Monthly                             Quarterly
------------------------------------------------------------------------
Arkansas                             Alabama
Iowa                                 Delaware
Kansas                               Florida
Kentucky                             Georgia
Michigan                             Illinois
Minnesota                            Indiana
Missouri                             Louisiana
Mississippi                          Maryland
North Carolina                       North Dakota
Tennessee                            Nebraska
Wisconsin                            New Jersey
                                     Ohio
                                     Oklahoma
                                     Pennsylvania
                                     South Carolina
                                     South Dakota
                                     Texas
                                     Virginia
                                     Eastern Region
                                     Western Region
------------------------------------------------------------------------

    (c) Reports. Each first purchaser or producer responsible for 
remitting assessments shall make reports on forms made available by the 
United Soybean Board or on Qualified State Soybean Board forms which 
contain the information required in Sec. 1220.241 and are approved by 
the Board. A first purchaser with multiple facilities or purchasing 
locations within a State shall have the option to submit a single, 
consolidated report specifying the combined volume of soybeans purchased 
or the net market value of all soybeans purchased from the producers in 
the State. Reports shall be submitted with assessments due in accordance 
with the provisions of paragraph (d) of this section.
    (d) Remittances. Each first purchaser or producer responsible for 
remitting assessments shall remit all assessments to the Qualified State 
Soybean Board, its designee, or the United Soybean Board. All 
assessments shall be remitted in the form of a check or money order 
payable to the order of the applicable Qualified State Soybean Board or 
the United Soybean Board and shall be sent to the designated address not 
later than the last day of the month following the month or quarter in 
which the soybeans, processed soybeans, or soybean products were 
marketed and shall be accompanied by the reports required by paragraph 
(c) of this section. All remittances shall be received subject to 
collection and payment at par.
    (e) Receipt of Reports and Remittances. The timeliness of receipt of 
reports and assessments by the Board or Qualified

[[Page 194]]

State Soybean Board shall be based on the applicable postmark date or 
the date actually received by the Board or the Qualified State Soybean 
Board whichever is earlier.

[57 FR 29439, July 2, 1992, as amended at 58 FR 40732, July 30, 1993; 60 
FR 58500, Nov. 28, 1995; 68 FR 69954, Dec. 16, 2003]



Sec. 1220.313  Qualified State Soybean Boards.

    The following State soybean promotion organizations shall be 
Qualified State Soybean Boards. First purchasers and producers 
responsible for remitting assessments located in States which have a 
Qualified State Soybean Board shall remit assessments accompanied by the 
required reports to the Qualified State Soybean Board in the State in 
which the first purchaser or producer responsible for remitting 
assessments is located.
    (1) Alabama Soybean Producers Board
    (2) Arkansas Soybean Promotion Board
    (3) Delaware Soybean Board
    (4) Florida Soybean Advisory Council
    (5) Georgia Agricultural Commodity Commission for Soybeans
    (6) Illinois Soybean Program Operating Board
    (7) Iowa Soybean Promotion Board
    (8) Indiana Soybean Development Council, Inc.
    (9) Kansas Soybean Commission
    (10) Kentucky Soybean Promotion Board
    (11) Louisiana Soybean Promotion Board
    (12) Maryland Soybean Board
    (13) Soybean promotion Committee of Michigan
    (14) Minnesota Soybean Research and Promotion Council
    (15) Mississippi Soybean Promotion Board
    (16) Missouri Soybean Merchandising Council
    (17) Nebraska Soybean Development, Utilization, and Marketing Board
    (18) New Jersey Soybean Board
    (19) North Carolina Soybean Producers Association
    (20) North Dakota Soybean Council
    (21) Ohio Soybean Council Board of Trustees
    (22) Oklahoma Soybean Commission
    (23) Pennsylvania Soybean Board
    (24) South Carolina Soybean Board
    (25) South Dakota Soybean Research and Promotion Council
    (26) Tennessee Soybean Promotion Board
    (27) Texas Soybean Producers Board
    (28) Virginia Soybean Board
    (29) Wisconsin Soybean Marketing Board, Inc.



Sec. 1220.314  Document evidencing payment of assessments.

    (a) Each first purchaser responsible for remitting an assessment to 
a Qualified State Soybean Board or the United Soybean Board is required 
to give to the producer from whom the first purchaser collected an 
assessment written evidence of payment of the assessment containing the 
following information:
    (1) Name and address of the first purchaser.
    (2) Name of producer who paid assessment.
    (3) Number of bushels sold.
    (4) Net market price.
    (5) Total assessments paid by the producer.
    (6) Date.
    (7) State in which soybeans were grown.
    (b) [Reserved]



Sec. Sec. 1220.330-1220.332  [Reserved]

Subparts C-E [Reserved]



              Subpart F_Procedures To Request a Referendum

    Source: 69 FR 13461, Mar. 23, 2004, unless otherwise noted.

                               Definitions



Sec. 1220.600  Act.

    Act means the Soybean, Promotion, Research, and Consumer Information 
Act set forth in title XIX, subtitle E, of the Food, Agriculture, 
Conservation, and Trade Act of 1990 (Pub. L. 101-624), and any 
amendments thereto.



Sec. 1220.601  Administrator, AMS.

    Administrator, AMS, means the Administrator of the Agricultural 
Marketing Service, or any officer or employee of USDA to whom there has

[[Page 195]]

been delegated or may be delegated the authority to act in the 
Administrator's stead.



Sec. 1220.602  Administrator, FSA.

    Administrator, FSA, means the Administrator, of the Farm Service 
Agency, or any officer or employee of USDA to whom there has been 
delegated or may be delegated the authority to act in the 
Administrator's stead.



Sec. 1220.603  Farm Service Agency.

    Farm Service Agency also referred to as ``FSA'' means the Farm 
Service Agency of USDA.



Sec. 1220.604  Farm Service Agency County Committee.

    Farm Service Agency County Committee, also referred to as ``FSA 
County Committee or COC,'' means the group of persons within a county 
who are elected to act as the Farm Service Agency County Committee.



Sec. 1220.605  Farm Service Agency County Executive Director.

    Farm Service Agency County Executive Director, also referred to as 
``CED,'' means the person employed by the FSA County Committee to 
execute the policies of the FSA County Committee and to be responsible 
for the day-to-day operation of the FSA county office, or the person 
acting in such capacity.



Sec. 1220.606  Farm Service Agency State Committee.

    Farm Service Agency State Committee, also referred to as ``FSA State 
Committee,'' means the group of persons within a State who are appointed 
by the Secretary to act as the Farm Service Agency State Committee.



Sec. 1220.607  Farm Service Agency State Executive Director.

    Farm Service Agency State Executive Director, also referred to as 
``SED,'' means the person employed by the FSA State Committee to execute 
the policies of the FSA State Committee and to be responsible for the 
day-to-day operation of the FSA State office, or the person acting in 
such capacity.



Sec. 1220.608  Order.

    Order means the Soybean Promotion and Research Order.



Sec. 1220.609  Person.

    Person means any individual, group of individuals, partnership, 
corporation, association, cooperative, or any other legal entity.



Sec. 1220.610  Producer.

    Producer means any person engaged in the growing of soybeans in the 
United States who owns or who shares the ownership and risk of loss of 
such soybeans.



Sec. 1220.611  Public notice.

    Public notice means a notice published in the Federal Register, not 
later than 60 days prior to the last day of the Request for Referendum 
period, that provides information regarding the Request for Referendum 
period. Such notification shall include, but not be limited to 
explanation of producers' rights, procedures to request a referendum, 
the purpose, dates of the Request for Referendum period, location for 
conducting the Request for Referendum, and eligibility requirements. 
Additionally, the United Soybean Board is required to provide producers, 
in writing, this same information during the same time period. Other 
pertinent information shall also be provided, without advertising 
expense, through press releases by State and county FSA offices and 
other appropriate Government offices, by means of newspapers, electronic 
media, county newsletters, and the like.



Sec. 1220.612  Representative period.

    Representative period means the period designated by the Secretary 
pursuant to section 1970 of the Act.



Sec. 1220.613  Secretary.

    Secretary means the Secretary of Agriculture of the United States 
Department of Agriculture (USDA) or any other officer or employee of 
USDA to whom there has been delegated or to whom there may be delegated 
the authority to act in the Secretary's stead.

[[Page 196]]



Sec. 1220.614  Soybeans.

    Soybeans means all varieties of glycine max or glycine soja.



Sec. 1220.615  State and United States.

    State and United States include the 50 States of the United States 
of America, the District of Columbia, and the Commonwealth of Puerto 
Rico.

                               Procedures



Sec. 1220.616  General.

    An opportunity to request a referendum shall be provided to U.S. 
soybean producers to determine whether eligible producers favor the 
conduct of a referendum and the Request for Referendum shall be carried 
out in accordance with this subpart.
    (a) The opportunity to request a referendum shall be provided at the 
county FSA offices.
    (b) If the Secretary determines, based on results of the Request for 
Referendum that no less than 10 percent (not in excess of one-fifth of 
which may be producers in any one State) of all producers have requested 
a referendum on the Order, a referendum will be held within 1 year of 
that determination.
    (c) If the Secretary determines, based on the results of the Request 
for Referendum, that the requirements in paragraph (b) of this section 
are not met, a referendum will not be conducted.
    (d) For purposes of paragraphs (b) and (c) of this section, the 
number of soybean producers in the United States is determined to be 
663,880.



Sec. 1220.617  Supervision of the process for requesting a referendum.

    The Administrator, AMS, shall be responsible for supervising the 
process of permitting producers to request a referendum in accordance 
with this subpart.



Sec. 1220.618  Eligibility.

    (a) Eligible producers. Each person who was a producer and provides 
evidence that they or the producer entity they represent has paid an 
assessment on soybeans during the representative period is provided the 
opportunity to request a referendum. Each producer entity is entitled to 
only one request.
    (b) Proxy Registration. Proxy registration is not authorized, except 
that an officer or employee of a corporate producer, or any guardian, 
administrator, executor, or trustee of a producer's estate, or an 
authorized representative of any eligible producer entity (other than an 
individual producer), such as a corporation or partnership, may request 
a referendum on behalf of that entity. Any individual who requests a 
referendum on behalf of any producer entity, shall certify that he or 
she is authorized by such entity to take such action.
    (c) Joint and group interest. A group of individuals, such as 
members of a family, joint tenants, tenants in common, a partnership, 
owners of community property, or a corporation engaged in the production 
of soybeans as a producer entity shall be entitled to make only one 
request for a referendum; provided, however, that any individual member 
of a group who is an eligible producer separate from the group may 
request a referendum separately.



Sec. 1220.619  Time and Place for Requesting a Referendum.

    (a) The opportunity to request a referendum shall be provided during 
a 4-week period beginning and ending on a date determined by the 
Secretary. Eligible persons shall have the opportunity to request a 
referendum by following the procedures in Sec. 1220.622 during the 
normal business hours of each county FSA office.
    (b) Producers can determine the location of county FSA offices by 
contacting the nearest county FSA office, the State FSA office or 
through an online search of FSA's web site at www.fsa.usda.gov/pas/
default.asp.
    (c) Each eligible person shall request a referendum in the county 
FSA office where FSA maintains and processes the producer's, 
corporation's, or other entities administrative farm records. For the 
producer, corporation, or other entity not participating in FSA 
programs, the opportunity to request a referendum would be provided at 
the county FSA office serving the county where the producer, 
corporation, or other legal entity owns or rents land.

[[Page 197]]

An individual or authorized representative of a corporation who grows 
soybeans in more than one county would request a referendum in the 
county FSA office where the individual or corporation or other entity 
does most of its business.



Sec. 1220.620  Facilities.

    Each county FSA office will provide:
    (a) A polling place that is well known and readily accessible to 
producers in the county and that is equipped and arranged so that each 
person can complete and submit their request in secret without coercion, 
duress, or interference of any sort whatsoever, and
    (b) A holding container of sufficient size so arranged that no 
request can be read or removed without breaking seals on the container.



Sec. 1220.621  Certification and request form.

    Form LS-51-1 shall be used to request a referendum and certify 
producer eligibility. The form does not require a ``yes'' or ``no'' 
vote. Individual producers and representatives of other producer 
entities should read the form carefully. By completing and signing the 
form, the individual simultaneously certifies eligibility and requests 
that a referendum be conducted.



Sec. 1220.622  Certification and request procedures.

    (a) To request that a referendum be conducted, each eligible 
producer shall, during the Request for Referendum period, be provided 
the opportunity to request a referendum during a specified period 
announced by the Secretary.
    (1) Each eligible producer shall be required to complete form LS-51-
1 in its entirety and sign it. The producer must legibly print his/her 
name and, if applicable, the producer entity represented, address, 
county, and telephone number. The producer must read the certification 
statement on form LS-51-1 and sign it certifying that:
    (i) The person or the producer entity they represent was a producer 
of soybeans during the representative period;
    (ii) The individual requesting a referendum on behalf of a 
corporation or other entity is authorized to do so; and
    (iii) The individual has submitted only one request for a referendum 
unless they are also an authorized representative for another eligible 
corporation or other entity.
    (2) The producer, corporation, or other entity must also provide 
documentation, such as a sales receipt, showing that the producer, 
corporation, or other entity has paid an assessment on soybeans during 
the representative period.
    (3) Only a completed and signed form LS-51-1 accompanied by 
documentation showing that soybean assessments were paid during the 
representative period shall be considered a valid request for a 
referendum.
    (b) To request a referendum, eligible producers may obtain form LS-
51-1 in-person, by mail, or by facsimile during the request for 
referendum period from the county FSA office where FSA maintains and 
processes the producer's, corporation's, or other entity's 
administrative farm records. For the producer, corporation, or other 
entity not participating in FSA programs, the opportunity to request a 
referendum would be provided at the county FSA office serving the county 
where the producer, corporation, or other entity owns or rents land. 
Eligible producers may also obtain form LS-51-1 via the Internet at 
www.ams.usda.gov/lsg/mpb/rp-soy.htm. For those persons who chose to 
obtain form LS-51-1 via the Internet, the completed form and required 
documentation must be submitted to the county FSA office where FSA 
maintains and process the producer's, corporation's, or other entity's 
administrative farm records. For producer, corporation, or other entity 
not participating in FSA programs, the opportunity to request a 
referendum would be provided at the county FSA office serving the county 
where the producer, corporation, or other entity owns or rents land.
    (c) Producers or producer entities may return form LS-51-1 and the 
accompanying documentation in-person, by mail, or facsimile to the 
appropriate county FSA office. Form LS-51-1 returned in-person or by 
facsimile, must be received in the appropriate county FSA office prior 
to the close of the

[[Page 198]]

work day on the final day of the Request for Referendum period to be 
considered a valid request. Form LS-51-1 and the accompanying 
documentation returned by mail must be postmarked no later than midnight 
of the final day of the Request for Referendum period and must be 
received in the county FSA office prior to the start of canvassing Form 
LS 51-1.
    (d) Producers who obtain form LS-51-1 in-person at the appropriate 
FSA county office may complete and return the form the same day, 
accompanied by documentation, such as a sales receipt, showing that 
soybean assessments were paid during the representative period.



Sec. 1220.623  Canvassing requests.

    (a) Canvassing of Form LS-51-1 shall take place at the opening of 
county FSA offices on the 5th business day following the Request for 
Referendum period. Such canvassing, acting on behalf of the 
Administrator, AMS, shall be in the presence of at least two members of 
the county committee. If two or more of the counties have been combined 
and are served by one county office, the canvassing of the requests 
shall be conducted by at least one member of the county committee from 
each county served by the county office. The FSA State committee or the 
State Executive Director if authorized by the State Committee, may 
designate the County Executive Director (CED) and a county or State FSA 
office employee to canvass the requests and report the results instead 
of two members of the county committee when it is determined that the 
number of eligible voters is so limited that having two members of the 
county committee present for this function is impractical, and designate 
the CED and/or another county or State FSA office employee to canvass 
requests in any emergency situation precluding at least two members of 
the county committee from being present to carry out the functions 
required in this section.
    (b) The request for referendum should be canvassed as follows:
    (1) Number of eligible requests for a referendum. Each person who 
was a producer during the representative period and provides 
documentation to prove that they paid an assessment will be considered 
eligible to request a referendum.
    (2) Number of ineligible requests for a referendum. If FSA cannot 
determine that a producer is eligible based on the submitted 
documentation or if the producer fails to submit the required 
documentation, the producer shall be determined to be ineligible. FSA 
shall notify ineligible producers in writing as soon as practicable but 
no later than the 8th business day following the final day of the 
Request for Referendum period.
    (c) Appeal. A person declared to be ineligible by FSA can appeal 
such decision and provide additional documentation to the FSA county 
office within 5 business days after the postmark date of the letter of 
notification of ineligibility. FSA will then make a final decision on 
the producer's eligibility and notify the producer of the decision.
    (d) Number of valid requests for referendum. A person has been 
declared eligible and has provided and completed all of the required 
information on form LS-51-1.
    (e) Number of invalid requests for a referendum. An invalid request 
for referendum includes, but is not limited to the following:
    (1) Form LS-51-1 is not signed or all required information has not 
been provided;
    (2) Form LS-51-1 and supporting documentation returned in-person or 
by facsimile was not received by the last business day of the Request 
for Referendum period;
    (3) Form LS-51-1 and supporting documentation returned by mail was 
not postmarked by midnight of the final day of the Request for 
Referendum period;
    (4) Form LS-51-1 and supporting documentation returned by mail was 
not received in the county FSA office prior to canvassing of the 
ballots;
    (5) Form LS-51-1 or supporting documentation is mutilated or marked 
in such a way that any required information on the form is illegible; or
    (6) Form LS-51-1 and supporting documentation not returned to the 
appropriate county FSA office.

[[Page 199]]



Sec. 1220.624  Confidentiality.

    The names of persons requesting a referendum shall be confidential 
and may not be divulged except as the Secretary may direct.



Sec. 1220.625  Counting requests.

    (a) The requests for a referendum shall be counted by county FSA 
offices on the same day as the requests are canvassed if there are no 
ineligibility determinations to resolve. For those county FSA offices 
that do have ineligibility determinations, the requests shall be counted 
no later than the 14th business day following the final day of the 
Request for Referendum period.
    (b) Requests for a referendum shall be counted as follows:
    (1) Total number of producers who returned a Request for Referendum 
form LS-51-1;
    (2) Number of ineligible producers requesting a referendum;
    (3) Number of eligible producers requesting a referendum;
    (4) Number of valid requests for a referendum; and
    (5) Number of invalid requests for a referendum.



Sec. 1220.626  FSA county office report.

    The county FSA office report shall be certified as accurate and 
complete by the CED or designee, acting on behalf of the Administrator, 
AMS, as soon as may be reasonably possible, but in no event later than 
18th business day following the final day of the specified period, have 
prepared and certified the county summary of requests on a form provided 
by the Administrator, FSA. Each county FSA office shall transmit the 
results in its county to the FSA State office. The results in each 
county may be made available to the public upon notification by the 
Administrator, FSA, that the final results have been released by the 
Secretary. A copy of the report shall be posted for 30 days following 
the date of notification by the Administrator, FSA, in the county FSA 
office in a conspicuous place accessible to the public. One copy shall 
be kept on file in the county FSA office for a period of at least 12 
months after notification by FSA that the final results have been 
released by the Secretary.



Sec. 1220.627  FSA State office report.

    Each FSA State office shall transmit to the Administrator, FSA, as 
soon as possible, but in no event later than the 20th business day 
following the final day of the Request for Referendum period, a report 
summarizing the data contained in each of the reports from the county 
FSA offices. One copy of the State summary shall be filed for a period 
of not less than 12 months after the results have been released and 
available for public inspection after the results have been released.



Sec. 1220.628  Results of the request for referendum.

    (a) The Administrator, FSA, shall submit to the Administrator, AMS, 
the reports from all State FSA offices. The Administrator, AMS, shall 
tabulate the results of the Request for Referendum. USDA will issue an 
official press release announcing the results of the Request for 
Referendum and publish the same results in the Federal Register. In 
addition, USDA will post the official results at the following Web site: 
http://www.ams.usda.gov/lsg/mpb/rp-soy.htm. Subsequently, State reports 
and related papers shall be available for public inspection upon request 
during normal business hours in the Marketing Programs Branch office, 
Livestock and Seed Program, AMS, USDA, Room 2638-S, STOP 0251, 1400 
Independence Avenue, SW., Washington, DC.
    (b) If the Secretary deems necessary, a State report or county 
report shall be reexamined and checked by such persons who may be 
designated by the Secretary.



Sec. 1220.629  Disposition of records.

    Each FSA CED will place in sealed containers marked with the 
identification of the ``Request for Soybean Referendum,'' all of the 
form LS-51-1's along with the accompanying documentation and county 
summaries. Such records will be placed in a secure location under the 
custody of the FSA CED for a period of not less than 12 months after the 
date of notification by the Administrator, FSA, that the final results 
have been announced by the Secretary. If the county FSA office receives 
no notice to the contrary from the Administrator, FSA, by the end of

[[Page 200]]

the 12 month period as described above, the CED or designee shall 
destroy the records.



Sec. 1220.630  Instructions and forms.

    The Administrator, AMS, is authorized to prescribe additional 
instructions and forms not inconsistent with the provisions of this 
subpart.



PART 1230_PORK PROMOTION, RESEARCH, AND CONSUMER INFORMATION--Table 
of Contents




   Subpart A_Pork Promotion, Research, and Consumer Information Order

                               Definitions

Sec.
1230.1 Act.
1230.2 Department.
1230.3 Secretary.
1230.4 Board.
1230.5 Consumer information.
1230.6 Council.
1230.7 Customs Service.
1230.8 Delegate Body.
1230.9 Fiscal period.
1230.10 Imported.
1230.11 Imported pork and pork products.
1230.12 Importer.
1230.13 Market.
1230.14 Market value.
1230.15 Part and subpart.
1230.16 Person.
1230.17 Plans and projects.
1230.18 Porcine animal.
1230.19 Pork.
1230.20 Pork product.
1230.21 Producer.
1230.22 Promotion.
1230.23 Research.
1230.24 State.
1230.25 State association.
1230.26 State where produced.

                  National Pork Producers Delegate Body

1230.30 Establishment and membership.
1230.31 Nomination and appointment of producer members.
1230.32 Conduct of election.
1230.33 Appointment of importer members.
1230.34 Term of office.
1230.35 Vacancies.
1230.36 Procedure.
1230.37 Officers.
1230.38 Compensation and reimbursement.
1230.39 Powers and duties of the Delegate Body.

                           National Pork Board

1230.50 Establishment and membership.
1230.51 Term of office.
1230.52 Nominations.
1230.53 Nominee's agreement to serve.
1230.54 Appointment.
1230.55 Vacancies.
1230.56 Procedure.
1230.57 Compensation and reimbursement.
1230.58 Powers and duties of the Board.

              Promotion, Research, and Consumer Information

1230.60 Promotion, research, and consumer information.

                        Expenses and Assessments

1230.70 Expenses.
1230.71 Assessments.
1230.72 Distribution of assessments.
1230.73 Uses of distributed assessments.
1230.74 Prohibited use of distributed assessments.
1230.75 Adjustment of accounts.
1230.76 Charges.
1230.77 [Reserved]

                       Reports, Books, and Records

1230.80 Reports.
1230.81 Books and records.
1230.82 Confidential treatment.

                              Miscellaneous

1230.85 Proceedings after termination.
1230.86 Effect of termination or amendment.
1230.87 Personal liability.
1230.88 Patents, copyrights, inventions, and publications.
1230.89 Amendments.
1230.90 Separability.
1230.91 Paperwork Reduction Act assigned number.

                     Subpart B_Rules and Regulations

                               Definitions

1230.100 Terms defined.

                               Assessments

1230.110 Assessments on imported pork and pork products.
1230.111 Remittance of assessments on domestic porcine animals.
1230.112 Rate of assessment.
1230.113 Collection and remittance of assessments for the sale of feeder 
          pigs and market hogs.
1230.115 Submission of annual financial statements.

                              Miscellaneous

1230.120 OBM control number assigned pursuant to the Paperwork Reduction 
          Act.

[[Page 201]]

Subpart C [Reserved]

Subpart D_Procedures for Nominations and Elections of Pork Producers and 
 Nominations of Importers for Appointment to the Initial National Pork 
                         Producers Delegate Body

1230.501-1230.512 [Reserved]

           Subpart E_Procedures for the Conduct of Referendum

                               Definitions

1230.601 Act.
1230.602 Administrator, AMS.
1230.603 Administrator, FSA.
1230.604 Department.
1230.605 Farm Service Agency.
1230.606 Farm Service Agency County Committee.
1230.607 Farm Service Agency County Executive Director.
1230.608 Imported porcine animals, pork, and pork products.
1230.609 Importer.
1230.610 Order.
1230.611 Porcine animal.
1230.612 Person.
1230.613 Pork.
1230.614 Pork product.
1230.615 Producer.
1230.616 Public notice.
1230.617 Referendum.
1230.618 Representative period.
1230.619 Secretary.
1230.620 State.
1230.621 Voting period.

                               Referendum

1230.622 General.
1230.623 Supervision of referendum.
1230.624 Eligibility.
1230.625 Time and place of registration and voting.
1230.626 Facilities for registering and voting.
1230.627 Registration form and ballot.
1230.628 Registration and voting procedures for producers.
1230.629 Registration and voting procedures for importers.
1230.630 List of registered voters.
1230.631 Challenge of votes.
1230.632 Receiving ballots.
1230.633 Canvassing ballots.
1230.634 FSA county office report.
1230.635 FSA State office report.
1230.636 Results of the referendum.
1230.637 Disposition of ballots and records.
1230.638 Instructions and forms.
1230.639 Additional absentee voter challenge period.

    Authority: 7 U.S.C. 4801-4819.



   Subpart A_Pork Promotion, Research, and Consumer Information Order

    Source: 51 FR 31903, Sept. 5, 1986, unless otherwise noted.

                               Definitions



Sec. 1230.1  Act.

    Act means the Pork Promotion, Research, and Consumer Information Act 
of 1985 (7 U.S.C. 4801-4819) and any amendments thereto.



Sec. 1230.2  Department.

    Department means the United States Department of Agriculture.



Sec. 1230.3  Secretary.

    Secretary means the Secretary of Agriculture of the United States or 
any other officer or employee of the Department of Agriculture to whom 
authority has been delegated or may hereafter be delegated to act in the 
Secretary's stead.



Sec. 1230.4  Board.

    Board means the National Pork Board established pursuant to Sec. 
1230.50.



Sec. 1230.5  Consumer information.

    Consumer information means an activity intended to broaden the 
understanding of the sound nutritional attributes of pork and pork 
products, including the role of pork and pork products in a balanced, 
healthy diet.



Sec. 1230.6  Council.

    Council means the National Pork Producers Council, a nonprofit 
corporation of the type described in section 501(c)(5) of the Internal 
Revenue Code of 1954 and incorporated in the State of Iowa.



Sec. 1230.7  Customs Service.

    Customs Service means the United States Customs Service of the 
United States Department of Treasury.



Sec. 1230.8  Delegate Body.

    Delegate Body means the National Pork Producers Delegate Body 
established pursuant to Sec. 1230.30.

[[Page 202]]



Sec. 1230.9  Fiscal period.

    Fiscal period means the 12-month period ending on December 31 or 
such other consecutive 12-month period as the Secretary or Board may 
determine.



Sec. 1230.10  Imported.

    Imported means entered, or withdrawn from a warehouse for 
consumption, in the customs territory of the United States.



Sec. 1230.11  Imported pork and pork products.

    Imported pork and pork products means products which are imported 
into the United States which the Secretary determines contain a 
substantial amount of pork, including those products which have been 
assigned one or more of the following numbers in Schedule 1 of the 
Tariff Schedules of the United States Annotated (1985): 106.4020; 
106.4040; 106.8000; 106.8500; 107.1000; 107.1500; 107.3020; 107.3040; 
107.3060; 107.3515; 107.3525; 107.3540; and 107.3560.



Sec. 1230.12  Importer.

    Importer means a person who imports porcine animals, pork, or pork 
products into the United States.



Sec. 1230.13  Market.

    Market means to sell, slaughter for sale, or otherwise dispose of a 
porcine animal in commerce.



Sec. 1230.14  Market value.

    Market value means, with respect to porcine animals which are sold, 
the price at which they are sold. With respect to porcine animals 
slaughtered for the sale by the producer, the term means the most recent 
annual seven-market average for barrows and gilts, as published by the 
Department. With respect to imported porcine animals, the term means the 
declared value. With respect to imported pork and pork products, the 
term means an amount which represents the value of the live porcine 
animals from which the pork or pork products were derived, based upon 
the most recent annual seven-market average for barrows and gilts, as 
published by the Department.



Sec. 1230.15  Part and subpart.

    Part means the Pork Promotion, Research, and Consumer Information 
Order and all rules, regulations, and supplemental orders issued 
thereunder, and the aforesaid order shall be a ``subpart of such part.



Sec. 1230.16  Person.

    Person means any individual, group of individuals, partnership, 
corporation, association, organization, cooperative, or other entity.



Sec. 1230.17  Plans and projects.

    Plans and projects means promotion, research, and consumer 
information plans, studies, or projects.



Sec. 1230.18  Porcine animal.

    Porcine animal means a swine, that is raised as (a) a feeder pig, 
that is, a young pig sold to another person to be finished for 
slaughtering over a period of more than 1 month; (b) for breeding 
purposes as seed stock and included in the breeding herd; and (c) a 
market hog, slaughtered by the producer or sold to be slaughtered, 
usually within 1 month of such transfer.



Sec. 1230.19  Pork.

    Pork means the flesh of a porcine animal.



Sec. 1230.20  Pork product.

    Pork product means an edible product produced or processed in whole 
or in part from pork.



Sec. 1230.21  Producer.

    Producer means a person who produces porcine animals in the United 
States for sale in commerce.



Sec. 1230.22  Promotion.

    Promotion means any action, including but not limited to paid 
advertising and retail or food service merchandising, taken to present a 
favorable image for porcine animals, pork, or pork products to the 
public, or to educate producers with the intent of improving the 
competitive position and stimulating sales of porcine animals, pork, or 
pork products.

[[Page 203]]



Sec. 1230.23  Research.

    Research means any action designed to advance, expand, or improve 
the image, desirability, nutritional value, usage, marketability, 
production, or quality of porcine animals, pork, or pork products, 
including the dissemination of the results of such research.



Sec. 1230.24  State.

    State means each of the 50 States.



Sec. 1230.25  State association.

    State association means the single organization of producers in a 
State that is organized under the laws of that State and is recognized 
by the chief executive officer of such State as representing such 
State's producers. If no such organization exists in a State as of 
January 1, 1986, the Secretary may recognize an organization that 
represents not fewer than 50 producers who market annually an aggregate 
of not less than 10 percent of the pounds of porcine animals marketed in 
such State. The Secretary may cease to recognize a State association and 
instead recognize another organization of producers in a State as that 
State's association if the Secretary determines either that a majority 
of the members of the existing State association are not producers or 
that a majority of the members of the other organization seeking 
recognition are producers and that such organization better represents 
the economic interests of producers.



Sec. 1230.26  State where produced.

    State where produced means with respect to a porcine animal marketed 
as a feeder pig or as breeding stock, the State in which that porcine 
animal was born, and with respect to a porcine animal that is marketed 
as a market hog, the State in which that porcine animal was fed for 
market.

                  National Pork Producers Delegate Body



Sec. 1230.30  Establishment and membership.

    (a) There is hereby established a National Pork Producers Delegate 
Body which shall consist of producers and importers appointed by the 
Secretary.
    (b)(1) At least two producer members shall be allocated to each 
State, but any State that has more than 300 but less than 601 shares 
shall receive three producer members; each State with more than 600 but 
less than 1,001 shares shall receive four producer members and each 
State with more than 1,000 shares shall receive an additional member in 
excess of four for each 300 additional shares in excess of 1,000 shares, 
rounded to the nearest 300.
    (2) [Reserved]
    (3) In each fiscal period, shares shall be assigned to each State on 
the basis of one share for each $1,000 (rounded to the nearest $1,000) 
of the net amount of assessments attributable to such State.
    (c)(1) The number of importer members to be appointed shall be 
determined by allocating three such members for the first 1,000 shares. 
Importers shall receive an additional member in excess of three for each 
300 shares in excess of 1,000 shares, rounded to the nearest 300.
    (2) [Reserved]
    (3) In each fiscal period, shares shall be assigned to importers on 
the basis of one share for each $1,000 (rounded to the nearest $1,000) 
of the net amount of assessments attributable to importers.

[51 FR 31903, Sept. 5, 1986, as amended at 60 FR 58501, Nov. 28, 1995]



Sec. 1230.31  Nomination and appointment of producer members.

    (a) [Reserved]
    (b) Delegate Body nominations for appointment as producer members 
shall be submitted to the Secretary in the number requested by the 
Secretary by each State association either after an election conducted 
in accordance with Sec. 1230.32 and by nominating the producers who 
receive the highest number of votes in such State; or pursuant to a 
selection process that is approved by the Secretary, is given public-
notice at least one week in advance by publication in a newspaper or 
newspapers of general circulation in such State and in pork production 
and agriculture trade publications, and provides complete and equal 
access to every producer who has paid all assessments due under this 
subpart and who has not demanded any refund of an assessment paid 
pursuant to this subpart

[[Page 204]]

in the period since the selection of the previous Delegate Body;
    (c) The Secretary shall appoint the producer members of each 
Delegate Body from the nominations submitted in accordance with this 
section, except that if a State association does not submit nominations 
in the required manner or number, or if a State has no State 
association, the Secretary shall select producer members from that State 
after consultation with representatives of the pork industry in that 
State.

[51 FR 31903, Sept. 5, 1986, as amended at 60 FR 58501, Nov. 28, 1995]



Sec. 1230.32  Conduct of election.

    If a State association selects nominees for appointment to the 
Delegate Body through an election, it shall be conducted in the 
following manner:
    (a) Elections shall be administered by the Board and the Board shall 
determine the timing of any elections.
    (b) Producers who are residents of that State may be named as 
candidates for election to be nominees for appointment to the Delegate 
Body:
    (1) By a nominating committee of producers in that State appointed 
by the Board; or
    (2) The number of pork producers in a State shall be determined by 
the Department based on the latest available Department information, 
which tabulates by State the number of farming operations with porcine 
animals.
    (c) To be eligible to vote in an election to nominate producer 
members from a State, a person must:
    (1) Be a producer who is a resident of that State;
    (2) Have paid all assessments due pursuant to this subpart; and
    (3) Not have demanded any refund of an assessment paid pursuant to 
this subpart in the period since the selection of the previous Delegate 
Body.
    (d) The Board shall cause notices of any election to be published at 
least one week prior to the election in a newspaper or newspapers of 
general circulation in that State, and in pork production and 
agricultural trade publications. The notices shall set forth the period 
of time and places for voting and such other information as the Board 
considers necessary.
    (e) The identity of any person who voted and the manner in which any 
person voted shall be kept confidential.

[51 FR 31903, Sept. 5, 1986, as amended at 53 FR 30245, Aug. 11, 1988]



Sec. 1230.33  Appointment of importer members.

    The Secretary shall appoint the importer members of each Delegate 
Body after consultation with importers.



Sec. 1230.34  Term of office.

    (a) The members of the Delegate Body shall serve for terms of one 
year, except that the members of the initial Delegate Body shall serve 
only until the completion of the nomination and appointment process of 
the succeeding Delegate Body.
    (b) Each member of the Delegate Body shall serve until that member's 
term expires, or a successor is appointed, whichever occurs later.



Sec. 1230.35  Vacancies.

    To fill any vacancy occasioned by the death, removal, resignation, 
or disqualification of any member of the Delegate Body, the Secretary 
shall appoint a successor for the unexpired term of such member from 
nominations made either by the appropriate State association or by 
importers, depending upon whether the vacancy is a producer or importer 
vacancy.



Sec. 1230.36  Procedure.

    (a) A majority of the members shall constitute a quorum at a 
properly convened meeting of the Delegate Body, but only if that 
majority is also entitled to cast a majority of the shares (including 
fractions thereof). Any action of the Delegate Body, including any 
motion or nomination presented to it for a vote, shall require a 
majority vote, that is, the concurring votes of a majority of the shares 
cast on that action. The Delegate Body shall give timely notice of its 
meetings. The Delegate Body shall give the Secretary the same notice of 
its meetings as it gives to its members in order that the Secretary or a 
representative of the Secretary may attend meetings.
    (b) The number of votes that may be cast by a producer member if 
present

[[Page 205]]

at a meeting shall be equal to the number of shares attributable to the 
State of such member divided by the number of producer members from such 
State. The number of votes that may be cast by an importer member if 
present at a meeting shall be equal to the number of shares allocated to 
importers divided by the number of importer members.



Sec. 1230.37  Officers.

    The Delegate Body shall elect its Chairperson by a majority vote at 
the first annual meeting, but at each annual meeting after the first, 
the President of the Board shall serve as the Delegate Body's 
Chairperson.



Sec. 1230.38  Compensation and reimbursement.

    The members of the Delegate Body shall serve without compensation 
but may be reimbursed by the Board for actual transportation expenses 
incurred by them in exercising their powers and duties under this 
subpart. Such expenses shall be paid from funds received by the Board 
pursuant to Sec. 1230.72.



Sec. 1230.39  Powers and duties of the Delegate Body.

    The Delegate Body shall have the following powers and duties:
    (a) To meet annually;
    (b) To recommend the rate of assessment prescribed by the initial 
order and any increase in such rate;
    (c) To determine the percentage of the net assessments attributable 
to porcine animals produced in a State that each State association shall 
receive; and
    (d) To nominate not less than 23 persons, including producers from a 
minimum of 12 States or importers, for appointment to the initial Board 
and not less than one and one-half persons (rounded up to the nearest 
person) for each vacancy on the Board that requires nominations 
thereafter. Each nomination shall be by a majority vote of the Delegate 
Body voting in person in accordance with Sec. 1230.36.

                           National Pork Board



Sec. 1230.50  Establishment and membership.

    There is hereby established a National Pork Board of 15 members 
consisting of producers representing at least 12 States or importers 
appointed by the Secretary from nominations submitted pursuant to Sec. 
1230.39(d). The Board shall be deemed to be constituted once the 
Secretary makes the appointments to the Board.



Sec. 1230.51  Term of office.

    (a) The members of the Board shall serve for terms of three years, 
except that the members appointed to the initial Board shall be 
designated for, and shall serve terms as follows: One-third of such 
members shall serve for one year terms; One-third shall serve for two 
year terms; and the remaining One-third shall serve for three year 
terms.
    (b) Each member of the Board shall serve until the member's term 
expires, or until a successor is appointed, unless the member is removed 
pursuant to Sec. 1230.55(b).
    (c) No member shall serve more than two consecutive terms provided 
that those members serving an initial term of one year are eligible to 
serve two additional consecutive terms, but in no event, more than seven 
years in total.
    (d) The first year of the terms of the initial Board shall begin 
immediately on appointment by the Secretary and continue until July 1, 
1988. In subsequent years, the term of office shall begin on July 1.



Sec. 1230.52  Nominations.

    Nominations for members of the Board shall be made by the Delegate 
Body in accordance with Sec. 1230.39(d).



Sec. 1230.53  Nominee's agreement to serve.

    Any person nominated to serve on the Board shall file with the 
Secretary at the time of the nomination a written agreement to:
    (a) Serve on the Board if appointed;
    (b) Disclose any relationship with the Council or a State 
association or any organization that has a contract with the Board and 
thereafter disclose, at

[[Page 206]]

any time while serving on the Board, any relationship with any 
organization that applies to the Board for a contract; and
    (c) Withdraw from participation in deliberations, decisionmaking, or 
voting on matters concerning any entity referred to in paragraph (b) of 
this section, if an officer or member of the executive committee of such 
entity.



Sec. 1230.54  Appointment.

    From the nominations submitted pursuant to Sec. 1230.39(d), the 
Secretary shall appoint 15 producers or importers as members of the 
Board, but in no event shall the Secretary appoint producer members 
representing fewer than 12 States.



Sec. 1230.55  Vacancies.

    (a) To fill any vacancy occasioned by the death, removal, 
resignation, or disqualification of any member of the Board, the 
Secretary shall appoint a successor for the unexpired term of such 
member from the most recent list of nominations made by the Delegate 
Body.
    (b) If a member of the Board fails or refuses to perform the duties 
of a member of the Board, or if a member of the Board engages in acts of 
dishonesty or willful misconduct, the Board may recommend to the 
Secretary that that member be removed from office. If the Secretary 
finds that the recommendation of the Board demonstrates adequate cause, 
the Secretary shall remove such member from office. A person appointed 
under this part or any employee of the Board may be removed by the 
Secretary if the Secretary determines that the person's continued 
service would be detrimental to the purposes of the Act.



Sec. 1230.56  Procedure.

    (a) A majority of the members shall constitute a quorum at a 
properly convened meeting of the Board. Any action of the Board shall 
require the concurring votes of at least a majority of those present and 
voting. The Board shall give timely notice of its meetings. The Board 
shall give the Secretary the same notice of its meetings, including the 
meetings of its committees, as it gives to its members in order that the 
Secretary, or a representative of the Secretary, may attend the 
meetings.
    (b) The Board may take action upon the concurring votes of a 
majority of its members by mail, telephone, telegraph or by other means 
of communication when, in the opinion of the President of the Board, 
such action must be taken before a meeting can be called. Action taken 
by this emergency procedure is valid only if all members are notified 
and provided the opportunity to vote and any telephone vote is confirmed 
promptly in writing and recorded in the Board minutes. Any action so 
taken shall have the same force and effect as though such action had 
been taken at a properly convened meeting of the Board.



Sec. 1230.57  Compensation and reimbursement.

    The members of the Board shall serve without compensation but shall 
be reimbursed for reasonable expenses incurred by them in the exercise 
of their powers and the performance of their duties under this subpart. 
Such expenses shall be paid from funds received by the Board pursuant to 
Sec. 1230.72.



Sec. 1230.58  Powers and duties of the Board.

    The Board shall have the following powers and duties:
    (a) To meet not less than annually, and to organize and elect from 
among its members, by majority vote, a President and such other officers 
as may be necessary;
    (b) To receive and evaluate, or, on its own initiative, develop, and 
budget for proposals for plans and projects and to submit such plans and 
projects to the Secretary for approval;
    (c) To administer directly or through contract the provisions of 
this subpart in accordance with its terms and provisions;
    (d) To develop and submit to the Secretary for the Secretary's 
approval, plans and projects conducted either by the Board or others;
    (e) To prepare and submit to the Secretary for the Secretary's 
approval, which is required for the following to be implemented:

[[Page 207]]

    (1) Budgets on a fiscal period basis of its anticipated expenses and 
disbursements in the administration of this subpart, including the 
projected cost of plans and projects to be conducted by the Board 
directly or by way of contract or agreement; and
    (2) The budget, plans, or projects for which State associations are 
to receive funds under Sec. 1230.72, including a general description of 
the proposed plan and project contemplated therein;
    (f) With the approval of the Secretary, to enter into contracts or 
agreements with any person for the development and conduct of activities 
authorized under this subpart and for the payment of the cost thereof 
with funds collected through assessments pursuant to Sec. 1230.71. Any 
such contract or agreement shall provide that:
    (1) The contracting party shall develop and submit to the Board a 
plan or project together with a budget or budgets which shall show the 
estimated cost to be incurred for such plan or project;
    (2) Any such plan or project shall become effective upon approval of 
the Secretary; and
    (3) The contracting party shall keep accurate records of all of its 
relevant transactions and make periodic reports to the Board of relevant 
activities conducted and an accounting for funds received and expended, 
and such other reports as the Secretary or the Board may require. The 
Secretary or employees of the Board may audit periodically the records 
of the contracting party;
    (g) To appoint or employ staff persons as it may deem necessary, to 
define the duties and determine the compensation of each, to protect the 
handling of Board funds through fidelity bonds, and to conduct routine 
business.
    (h) To disseminate information to or communicate with producers or 
State associations through programs or by direct contact utilizing the 
public postage system or other systems;
    (i) To select committees and subcommittees of Board members and to 
adopt such rules and by laws for the conduct of its business as it may 
deem advisable;
    (j) To utilize advisory committees of persons other than Board 
members to assist in the development of plans or projects and pay the 
reasonable expenses and fees of the members of such committees;
    (k) To prescribe rules and regulations necessary to effectuate the 
terms and provisions of this subpart;
    (l) To recommend to the Secretary amendments to this subpart;
    (m) With the approval of the Secretary, to invest, pending 
disbursement pursuant to a plan or project, funds collected through 
assessments authorized under Sec. 1230.71 in, and only in, an 
obligation of the United States, a general obligation of any State or 
any political subdivision thereof, an interest-bearing account or 
certificate of deposit of a bank that is a member of the Federal Reserve 
System, or an obligation fully guaranteed as to principal and interest 
by the United States.
    (n) To maintain such books and records, which shall be available to 
the Secretary for inspection and audit, and prepare and submit such 
reports as the Secretary may prescribe from time to time, and to make 
appropriate accounting with respect to the receipt and disbursement of 
all funds entrusted to it;
    (o) To prepare and make public and available to producers and 
importers at least annually, a report of its activities carried out and 
an accounting of funds received and expended;
    (p) To have an audit of its financial statements conducted by a 
certified public accountant in accordance with generally accepted 
auditing standards at the end of each fiscal period and at such other 
times as the Secretary may request, and to submit a copy of each such 
audit report to the Secretary;
    (q) To receive, investigate, and report to the Secretary complaints 
of violations of the provisions of this subpart;
    (r) To submit to the Secretary such information pursuant to this 
subpart as the Secretary may request; and
    (s) To carry out an effective and coordinated program of promotion, 
research, and consumer information designed to strengthen the position 
of the pork industry in the marketplace and maintain, develop, and 
expand markets for pork and pork products.

[51 FR 31903, Sept. 5, 1986, as amended at 53 FR 30245, Aug. 11, 1988]

[[Page 208]]

              Promotion, Research, and Consumer Information



Sec. 1230.60  Promotion, research, and consumer information.

    (a) The Board shall receive and evaluate, or, on its own initiative, 
develop, and submit to the Secretary for approval, any plans and 
projects. Such plans and projects shall provide for:
    (1) The establishment, issuance, effectuation, and administration of 
appropriate plans and projects for promotion, research, and consumer 
information with respect to pork and pork products designed to 
strengthen the position of the pork industry in the marketplace and to 
maintain, develop, and expand domestic and foreign markets for pork and 
pork products;
    (2) The establishment and conduct of research and studies with 
respect to the sale, distribution, marketing, and utilization of pork 
and pork products and the creation of new products thereof, to the end 
that marketing and utilization of pork and pork products may be 
encouraged, expanded, improved, or made more acceptable.
    (b) Each plan and project shall be periodically reviewed or 
evaluated by the Board to ensure that the plan and project contributes 
to an effective and coordinated program of promotion, research, and 
consumer information. If it is found by the Board that any such plan and 
project does not further the purposes of the Act, the Board shall 
terminate such plan and project.
    (c) No plan or project shall make a false or misleading claim on 
behalf of pork or a pork product or a false or misleading statement with 
respect to an attribute or use of a competing product.
    (d) No plan or project shall undertake to advertise or promote pork 
or pork products by private brand or trade name unless such 
advertisement or promotion is specifically approved by the Board, with 
the concurrence of the Secretary.

                        Expenses and Assessments



Sec. 1230.70  Expenses.

    (a) The Board is authorized to incur such expenses (including 
provision for a reasonable reserve that would permit an effective 
promotion, research, and consumer information program to continue in 
years when the amount of assessments may be reduced) as the Secretary 
finds are reasonable and likely to be incurred by the Board for its 
administration, maintenance, and functioning and to enable it to 
exercise its powers and perform its duties in accordance with the 
provisions of this subpart, including financing plans and projects. Such 
expenses shall be paid from assessments collected pursuant to Sec. 
1230.71 and other funds available to the Board, including donations.
    (b) The Board shall reimburse the Secretary, from assessments 
collected pursuant to Sec. 1230.71, for reasonable administrative 
expenses incurred by the Department with respect to this subpart after 
January 1, 1986, including any expenses reasonably incurred for the 
conduct of elections of nominees for appointment to the initial Delegate 
Body and for the conduct of referenda.



Sec. 1230.71  Assessments.

    (a)(1) Each producer producing in the United States a porcine animal 
raised as a feeder pig that is sold shall pay an assessment on that 
animal, unless such producer demonstrates to the Board by appropriate 
documentation that an assessment was previously paid on that animal as a 
feeder pig.
    (2) Each producer producing in the United States a porcine animal 
raised for slaughter that is sold shall pay an assessment on that 
animal, unless such producer demonstrates to the Board by appropriate 
documentation that an assessment was previously paid on that animal as a 
market hog.
    (3) Each producer producing in the United States a porcine animal 
raised for slaughter that such producer slaughters for sale shall pay an 
assessment on that animal unless such producer demonstrates to the Board 
by appropriate documentation that an assessment was previously paid on 
that animal as a market hog.
    (4) Each producer producing in the United States a porcine animal 
raised for breeding stock that is sold shall pay an assessment on that 
animal, unless such producer demonstrates to the Board by appropriate 
documentation that an assessment was previously paid

[[Page 209]]

by a person on that animal as breeding stock.
    (5) Each importer importing a porcine animal, pork, or pork product 
into the United States shall pay an assessment on that porcine animal, 
pork, or pork product, unless such importer demonstrates to the Board by 
appropriate documentation that an assessment was previously paid for 
that porcine animal, pork, or pork product.
    (b)(1) Each purchaser of a porcine animal raised by a producer as a 
feeder pig or market hog shall collect an assessment on such porcine 
animal if an assessment is due pursuant to paragraph (a) of this 
section, and shall remit that assessment to the Board. For the purposes 
of collection and remittance of assessments, any person engaged as a 
commission merchant, auction market, or livestock market in the business 
of receiving such porcine animals for sale on commission for or on 
behalf of a producer shall be deemed to be a purchaser.
    (2) Assessments on porcine animals raised as breeding stock which 
are sold by a commission merchant, auction, market, or livestock market 
in the business of receiving such porcine animals for sale on commission 
for or on behalf of a producer shall be collected and remitted by the 
commission merchant, auction market, or livestock market selling such 
porcine animals.
    (3) Each producer of porcine animals slaughtered for sale by the 
producer or sold directly to a consumer in connection with a custom 
slaughter operation shall remit an assessment to the Board if an 
assessment is due pursuant to paragraph (a) of this section.
    (4) Assessments on domestic porcine animals shall be remitted in the 
form of a negotiable instrument made payable to the ``National Pork 
Board,'' which, together with the reports required by Sec. 1230.80, 
shall be sent to the address designated by the Board.
    (5) Each importer of a porcine animal, pork, or pork product shall 
remit an assessment to the Customs Service at the time such porcine 
animal, pork, or pork product is imported or in such manner as may be 
established by regulations prescribed by the Board and approved by the 
Secretary, if an assessment is due pursuant to paragraph (a) of this 
section.
    (c) The initial rate of assessment shall be 0.25 percent of market 
value.
    (d) The rate of assessment may, upon the recommendation of the 
Delegate Body, be increased by regulations prescribed by the Board and 
approved by the Secretary by no more than 0.1 percent of such market 
value per fiscal period to a total of not more than 0.5 percent of 
market value.
    (e) Assessments on imported pork and pork products shall be 
expressed in an amount per pound for each type of pork or pork product 
subject to assessment, which shall be established by regulations 
prescribed by the Board and approved by the Secretary.

[51 FR 31903, Sept. 5, 1986; 51 FR 36383, Oct. 10, 1986; 53 FR 1910, 
Jan. 25, 1988; 53 FR 30245, Aug. 11, 1988; 56 FR 6, Jan. 2, 1991]



Sec. 1230.72  Distribution of assessments.

    Assessments remitted to the Board shall be distributed as follows:
    (a) Each State association shall receive on a monthly basis, a 
percentage determined by the Delegate Body or 16.5 percent, whichever is 
higher, of the net assessments attributable to that State. The net 
assessments attributable to a State is the total amount of assessments 
received from producers in a State.
    (b) A State association which was conducting a pork promotion 
program in the period from July 1, 1984 to June 30, 1985, shall receive 
additional amounts at such times as the Board may determine, so that the 
total amount received on an annual basis would be equal to the amount 
that would have been collected in such State pursuant to the pork 
promotion program in existence in such State from July 1, 1984, to June 
30, 1985, had the porcine animals subject to assessment, been produced 
from July 1, 1984, to June 30, 1985, and been subject to the rates of 
assessment then in effect from such State to the Council and other 
national entities involved in pork promotion, research, and consumer 
information. This paragraph shall apply to a State association only if 
the annual amount determined under this paragraph would be greater than 
the annual

[[Page 210]]

amount determined under paragraph (a) of this section.
    (c) The Council shall receive on a monthly basis 35 percent of the 
net assessments until after the referendum is conducted, and 25 percent 
thereafter and until 12 months after the referendum.

[51 FR 31903, Sept. 5, 1986, as amended at 60 FR 58501, Nov. 28, 1995]



Sec. 1230.73  Uses of distributed assessments.

    (a) Each State association shall use its distribution of assessments 
pursuant to Sec. 1230.72, as well as any proceeds from the investment 
of such funds pending their use, for financing plans and projects and 
the administrative expenses incurred in connection therewith, including 
the cost of administering nominations and elections of producer members 
of the Delegate Body.
    (b) The Council shall use its distribution of assessments pursuant 
to Sec. 1230.72, as well as any proceeds from the investment of such 
funds pending their use, for financing plans and projects and the 
Council's administrative expenses.
    (c) The Board shall use its distribution of assessments pursuant to 
Sec. 1230.72, as well as any proceeds from the investment of such funds 
pending their use, for:
    (1) Financing plans and projects;
    (2) The Board's expenses for the Board's administration, 
maintenance, and functioning as authorized by the Secretary;
    (3) Accumulation of a reserve not to exceed one fiscal period's 
budget to permit continuation of an effective promotion, research, and 
consumer information program in years when assessment amounts may be 
reduced; and
    (4) The Secretary's administrative costs in carrying out this part.



Sec. 1230.74  Prohibited use of distributed assessments.

    (a) No funds collected under this subpart shall in any manner be 
used for the purpose of influencing legislation as that term is defined 
in section 4911 (d) and (e)(2) of the Internal Revenue Code of 1954, or 
for the purpose of influencing governmental policy or action except in 
recommending to the Secretary amendments to this part.
    (b) Organizations receiving distributions of assessments from the 
Board shall furnish the Board with annual financial statements audited 
by a certified public accountant of all funds distributed to such 
organizations pursuant to this subpart and any other reports as may be 
required by the Secretary or the Board in order to verify the use of 
such funds.

[51 FR 31903, Sept. 5, 1986, as amended at 53 FR 30245, Aug. 11, 1988; 
60 FR 33683, June 29, 1995]



Sec. 1230.75  Adjustment of accounts.

    Whenever the Board or the Department determines, through an audit of 
a person's reports, records, books or accounts or through some other 
means that additional money is due the Board or that money is due such 
person from the Board, such person shall be notified of the amount due. 
Any amount due the Board shall be remitted to the Board by the next date 
for remitting assessments as provided in Sec. 1230.71(b)(3). Any 
overpayment to the Board shall be credited to the account of the person 
remitting the overpayment and shall be applied against amounts due in 
succeeding months except that the Board shall make prompt payment when 
an overpayment cannot be adjusted by a credit.



Sec. 1230.76  Charges.

    Any assessment not paid when due shall be increased 1.5 percent each 
month beginning with the day following the date such assessment was due. 
Any remaining amount due, which shall include any unpaid charges 
previously made pursuant to this section, shall be increased at the same 
rate on the corresponding day of each month thereafter until paid. For 
the purpose of this section, any assessment that was determined at a 
date later than prescribed by this subpart because of a person's failure 
to submit a report to the Board when due shall be considered to have 
been payable by the date it would have been due if the report had been 
filed when due. The timeliness of a payment to the Board shall be based 
on the applicable postmark date or the

[[Page 211]]

date actually received by the Board, whichever is earlier.



Sec. 1230.77  [Reserved]

                       Reports, Books, and Records



Sec. 1230.80  Reports.

    Each person responsible for collecting or remitting any assessment 
under Sec. 1230.71(b) shall report at the time for remitting 
assessments to the Board the following information:
    (a) The quantity and market value of the porcine animals subject to 
assessment;
    (b) The amount of assessment collected;
    (c) The month the assessment was collected;
    (d) The State where the porcine animals were produced; and
    (e) Such other information as may be required by regulations 
prescribed by the Board and approved by the Secretary.



Sec. 1230.81  Books and records.

    Each person who is subject to this subpart shall maintain and, 
during normal business hours, make available for inspection by employees 
of the Board and the Secretary such books and records as are necessary 
to carry out the provision of this subpart, including such records as 
are necessary to verify any required reports. Such records shall be 
retained for at least two years beyond the fiscal period of their 
applicability.



Sec. 1230.82  Confidential treatment.

    All information obtained from the books, records or reports required 
to be maintained under Sec. Sec. 1230.80 and 1230.81 of this subpart 
shall be kept confidential by all persons, including employees and 
agents and former employees and agents of the Board, all officers and 
employees and all former officers and employees of the Department, and 
by all officers and all employees and all former officers and employees 
of contracting parties having access to such information, and shall not 
be available to Board members. Only those persons having a specific need 
for such information in order to effectively implement, administer, or 
enforce the provisions of this subpart shall have access to such 
information. In addition, only such information so furnished or acquired 
shall be disclosed as the Secretary deems relevant and then only in a 
suit or administrative hearing brought at the direction, or upon the 
request, of the Secretary or to which the Secretary or any officer of 
the United States is a party, and involving this subpart. Nothing in 
this section shall be deemed to prohibit:
    (a) The issuance of general statements based upon the reports of a 
number of persons subject to this subpart or of statistical data 
collected therefrom, which statements or data do not identify the 
information furnished by any person; or
    (b) The publication, by direction of the Secretary, of the name of 
any person who has been adjudged to have violated this subpart, together 
with a statement of the particular provisions of this subpart violated 
by such person.

                              Miscellaneous



Sec. 1230.85  Proceedings after termination.

    (a) Upon the termination of this subpart, the Board shall recommend 
not more than five of its members to the Secretary to serve as trustees 
for the purpose of liquidating the affairs of the Board. Such persons, 
upon designation by the Secretary, shall become trustees of all the 
funds and property owned, in the possession of, or under the control of, 
the Board, including unpaid claims or property not delivered or any 
other claim existing at the time of such termination.
    (b) The said trustees shall:
    (1) Continue in such capacity until discharged by the Secretary;
    (2) Carry out the obligations of the Board under any contract or 
agreement;
    (3) From time to time account for all receipts and disbursements and 
deliver all property on hand together with all books and records of the 
Board and of the trustees, to such persons as the Secretary may direct; 
and
    (4) Upon the request of the Secretary, execute such assignments or 
other instruments necessary or appropriate to vest in such persons full 
title and right

[[Page 212]]

to all of the funds, property, and claims vested in the Board or the 
trustees pursuant to this subpart.
    (c) Any residual funds not required to defray the necessary expenses 
of liquidation shall be turned over to the Secretary to be used, to the 
extent practicable, in the interest of continuing one or more of the 
plans and projects authorized pursuant to this subpart.



Sec. 1230.86  Effect of termination or amendment.

    Unless otherwise expressly provided by the Secretary, the 
termination of this subpart or of any regulation issued pursuant hereto, 
or the issuance of any amendment to either thereof, shall not:
    (a) Affect or waive any right, duty, obligation, or liability which 
shall have arisen or which may hereafter arise in connection with any 
provision of this subpart or any regulation issued thereunder;
    (b) Release or extinguish any violation of this subpart or any 
regulation issued thereunder; or
    (c) Affect or impair any rights or remedies of the United States, 
the Secretary, or any person with respect to any such violation.



Sec. 1230.87  Personal liability.

    No member or employee of the Board shall be held personally liable, 
either individually or jointly, in any way whatsoever to any person for 
errors in judgment, mistakes, or other acts of either commission or 
omission, as such member or employee, except for acts of dishonesty or 
willful misconduct.



Sec. 1230.88  Patents, copyrights, inventions, and publications.

    Any patents, copyrights, trademarks, inventions, or publications 
developed through the use of funds collected under the provisions of 
this subpart shall be the property of the United States Government as 
represented by the Board, and shall, along with any rents, royalties, 
residual payments, or other income from the rental, sale, leasing, 
franchising, or other uses of such patents, copyrights, inventions, or 
publications inure to the benefit of the Board as income and be subject 
to the same fiscal, budget, and audit controls as other funds of the 
Board. Upon termination of this subpart, Sec. 1230.85 shall apply to 
determine disposition of all such property.



Sec. 1230.89  Amendments.

    The Secretary may from time to time amend provisions of this part. 
Any interested person or organization affected by the provisions of the 
Act may propose amendments to the Secretary.



Sec. 1230.90  Separability.

    If any provision of this subpart is declared invalid or the 
applicability thereof to any person or circumstances is held invalid, 
the validity of the remainder of this subpart or the applicability 
thereof to other persons or circumstances shall not be affected thereby.



Sec. 1230.91  Paperwork Reduction Act assigned number.

    The information collection and recordkeeping requirements contained 
in this subpart have been approved by the Office of Management and 
Budget (OMB) under the provisions of 44 U.S.C. Chapter and have been 
assigned OMB Control Number 0851-0151.



                     Subpart B_Rules and Regulations

    Source: 53 FR 1911, Jan. 25, 1988, unless otherwise noted.

                               Definitions



Sec. 1230.100  Terms defined.

    As used throughout this subpart, unless the context otherwise 
requires, terms shall have the same meaning as the definition of such 
terms in Subpart A of this part.

                               Assessments



Sec. 1230.110  Assessments on imported pork and pork products.

    (a) The following Harmonized Tariff Schedule (HTS) categories of 
imported live porcine animals are subject to assessment at the rate 
specified.

[[Page 213]]



------------------------------------------------------------------------
     Live porcine animals        Article description       Assessment
------------------------------------------------------------------------
0103.10.0000..................  Purebred breeding      0.40 percent
                                 animals.               Customs Entered
                                                        Value.
0103.91.00....................  Other: Weighing less
                                 than 50 kg each.
0103.91.0010..................  Weighing less than 7   0.40 percent
                                 kg each.               Customs Entered
                                                        Value.
0103.91.0020..................  Weighing 7 kg or more  0.40 percent
                                 but less than 23 kg    Customs Entered
                                 each.                  Value.
0103.91.0030..................  Weighing 23 kg or      0.40 percent
                                 more but less than     Customs Entered
                                 50 kg each.            Value.
0103.92.00....................  Weighing 50 kg or
                                 more each.
0103.92.0010..................  Imported for           0.40 percent
                                 immediate slaughter.   Customs Entered
                                                        Value.
0103.92.0090..................  Other................  0.40 percent
                                                        Customs Entered
                                                        Value.
------------------------------------------------------------------------

    (b) The following HTS categories of imported pork and pork products 
are subject to assessment at the rates specified.

----------------------------------------------------------------------------------------------------------------
                                                                                                 Assessment
            Pork and pork products                          Article description            ---------------------
                                                                                             Cents/lb   Cents/kg
----------------------------------------------------------------------------------------------------------------
0203..........................................  Meat of swine, fresh, chilled, or frozen:
                                                 Fresh or chilled:
0203.11.0000..................................  Carcasses and half-carcasses..............        .20    .440920
0203.12.1010..................................  Processed hams and cuts thereof, with bone        .20    .440920
                                                 in.
0203.12.1020..................................  Processed shoulders and cuts thereof, with        .20    .440920
                                                 bone in.
0203.12.9010..................................  Other hams and cuts thereof, with bone in.        .20    .440920
0203.12.9020..................................  Other shoulders and cuts thereof, with            .20    .440920
                                                 bone in.
0203.19.2010..................................  Processed spare ribs......................        .23    .507058
0203.19.2090..................................  Processed other...........................        .23    .507058
0203.19.4010..................................  Bellies...................................        .20    .440920
0203.19.4090..................................  Other.....................................        .20    .440920
0203.21.0000..................................  Frozen carcasses and half-carcasses.......        .20    .440920
0203.22.1000..................................  Frozen-processed hams, shoulders, and cuts        .20    .440920
                                                 thereof, with bone in.
0203.22.9000..................................  Frozen-other hams, shoulders, and cuts            .20    .440920
                                                 thereof, with bone in.
0203.29.2000..................................  Frozen processed other....................        .23    .507058
0203.29.4000..................................  Frozen other: Other.......................        .20    .440920
0206..........................................  Edible offal of bovine animals, swine,
                                                 sheep, goats, horses, asses, mules or
                                                 hinnies, fresh, chilled, or frozen:.
0206.30.0000..................................  Of swine, fresh or chilled................        .20    .440920
0206.41.0000..................................  Of swine, frozen: Livers..................        .20    .440920
0206.49.0000..................................  Of swine, frozen: Other...................        .20    .440920
0210..........................................  Meat and edible meat offal, salted, in
                                                 brine, dried or smoked; edible flours and
                                                 meals of meat or meat offal:.
0210.11.0010..................................  Meat of swine: Hams and cuts thereof, with        .20    .440920
                                                 bone in.
0210.11.0020..................................  Meat of swine: Shoulders and cuts thereof,        .20    .440920
                                                 with bone in.
0210.12.0020..................................  Meat of swine: Bellies (streaky) and cuts         .20    .440920
                                                 thereof, Bacon.
0210.12.0040..................................  Meat of swine: Bellies (streaky) and cuts         .20    .440920
                                                 thereof, Other.
0210.19.0010..................................  Meat of swine: Canadian style bacon.......        .23    .507058
0210.19.0090..................................  Meat of Swine: Other......................        .23    .507058
1601..........................................  Sausages and similar products, of meat,
                                                 meat offal or blood; food preparations
                                                 based on these products:
1601.00.2010..................................  Pork canned...............................        .28    .617288
1601.00.2090..................................  Pork other................................        .28    .617288
1602..........................................  Other prepared or preserved meat, meat
                                                 offal or blood.
1602.41.2020..................................  Of swine: Boned and cooked and packed in          .30    .661380
                                                 airtight containers holding less than 1
                                                 kg.
1602.41.2040..................................  Of swine: Other boned and cooked and              .30    .661380
                                                 packed in airtight containers.
1602.41.9000..................................  Of swine: Other...........................        .20    .440920
1602.42.2020..................................  Of swine: Shoulders and cuts thereof:             .30    .661380
                                                 Boned and cooked and packed in airtight
                                                 containers holding less than 1 kg.
1602.42.2040..................................  Of swine: Shoulders and cuts thereof:             .30    .661380
                                                 Other boned and cooked and packed in
                                                 airtight containers.
1602.42.4000..................................  Of swine: Other shoulders and cuts thereof        .20    .440920
1602.49.2000..................................  Of swine: Other, including mixtures: Not          .28    .617288
                                                 containing cereals or vegetables: Boned
                                                 and cooked and packed in air-tight
                                                 containers.
1602.49.4000..................................  Of swine: Other, including mixtures: Not          .23    .507058
                                                 containing cereals or vegetables: Other.
1602.49.9000..................................  Of swine: Other, including mixtures: Other        .23    .507058
----------------------------------------------------------------------------------------------------------------


[69 FR 9925, Mar. 3, 2004]



Sec. 1230.111  Remittance of assessments on domestic porcine animals.

    Assessments on domestic porcine animals shall be remitted to the 
National

[[Page 214]]

Pork Board pursuant to Sec. 1230.71(b) in accordance with the following 
remittance schedule.
    (a) Monthly assessments totaling $25 or more shall be remitted to 
the Board by the 15th day of the month following the month in which the 
porcine animals were marketed or by the 15th day following the end of a 
Board-approved, consecutive 4-week period in which the porcine animals 
were marketed.
    (b) Assessments totaling less than $25 during each month of a 
quarter in which the porcine animals were marketed may be accumulated 
and remitted by the 15th day of the month following the end of a 
quarter. The quarters shall be: January through March; April through 
June; July through September; October through December.
    (c) Assessments totaling $25 or more during any month of a quarter 
must be remitted by the 15th day of the month following the month of the 
quarter in which the assessments totaled $25 or more, together with any 
unremitted assessments from the previous month(s) of the quarter, if 
applicable.
    (d) Assessments collected during any calendar quarter and not 
previously remitted as described in paragraphs (b) or (c) of this 
section must be remitted by the 15th day of the month following the end 
of the quarter regardless of the amount.

[56 FR 6, Jan. 2, 1991]



Sec. 1230.112  Rate of assessment.

    In accordance with Sec. 1230.71(d) the rate of assessment shall be 
0.40 percent of market value.

[67 FR 58323, Sept. 16, 2002]



Sec. 1230.113  Collection and remittance of assessments for the sale 
of feeder pigs and market hogs.

    Pursuant to the provisions of Sec. 1230.71, purchasers of feeder 
pigs or market hogs shall collect assessments from producers if an 
assessment is due and shall remit those assessments to the Board. 
Failure of the purchaser to collect such assessment from a producer 
shall not relieve the producer of the obligation to pay the assessment. 
If the purchaser fails to collect the assessment when an assessment is 
due pursuant to Sec. 1230.71, the producer (seller) shall remit the 
total amount of assessments due to the Board as set forth in Sec. 
1230.111.

[65 FR 7283, Feb. 14, 2000]



Sec. 1230.115  Submission of annual financial statements.

    State Pork Producer Associations, as defined in Sec. 1230.25, that 
receive distributions of assessments pursuant to Sec. 1230.72 and that 
receive less than $30,000 in assessments annually, may satisfy the 
requirements of Sec. 1230.74(b) by providing to the Board unaudited 
annual financial statements prepared by State association staff members 
or individuals who prepare annual financial statements, provided that 
two members of the State association attest to and certify such 
financial statements. Notwithstanding any provisions of the Order to the 
contrary, State associations that receive less than $30,000 in 
distributed assessments annually and submit unaudited annual financial 
statements to the Board shall be required to submit an annual financial 
statement audited by a certified public accountant at least once every 5 
years, or more frequently if deemed necessary by the Board or the 
Secretary. The Board may elect to conduct its own audit of the annual 
financial statements of State Pork Producer Associations that receive 
less than $2,000 in distributed assessments annually, every 5 years in 
lieu of the required financial statements.

[60 FR 33683, June 29, 1995]

                              Miscellaneous



Sec. 1230.120  OMB control number assigned pursuant to the Paperwork 
Reduction Act.

    The information collection and recordkeeping requirements contained 
in this part have been approved by the Office of Management and Budget 
(OMB) under the provisions of 44 U.S.C. Chapter 35 and have been 
assigned OMB control number 0851-0151.

Subpart C [Reserved]

[[Page 215]]



Subpart D_Procedures for Nominations and Elections of Pork Producers and 

 Nominations of Importers for Appointment to the Initial National Pork 
                         Producers Delegate Body



Sec. 1230.501-1230.512  [Reserved]



           Subpart E_Procedures for the Conduct of Referendum

    Source: 65 FR 43508, July 13, 2000, unless otherwise noted.

                               Definitions



Sec. 1230.601  Act.

    The term Act means the Pork Promotion, Research, and Consumer 
Information Act of 1985 (7 U.S.C. 4801-4819) and any amendments thereto.



Sec. 1230.602  Administrator, AMS.

    The term Administrator, AMS, means the Administrator of the 
Agricultural Marketing Service, or any officer or employee of the 
Department to whom there has heretofore been delegated or may hereafter 
be delegated the authority to act in the Administrator's stead.



Sec. 1230.603  Administrator, FSA.

    The term Administrator, FSA, means the Administrator, of the Farm 
Service Agency, or any officer or employee of the Department to whom 
there has heretofore been delegated or may hereafter be delegated the 
authority to act in the Administrator's stead.



Sec. 1230.604  Department.

    The term Department means the United States Department of 
Agriculture.



Sec. 1230.605  Farm Service Agency.

    The term Farm Service Agency also referred to as ``FSA'' means the 
Farm Service Agency of the Department.



Sec. 1230.606  Farm Service Agency County Committee.

    The term Farm Service Agency County Committee, also referred to as 
the FSA County Committee or COC, means the group of persons within a 
county elected to act as the Farm Service Agency County Committee.



Sec. 1230.607  Farm Service Agency County Executive Director.

    The term Farm Service Agency County Executive Director also referred 
to as the CED, means the person employed by the FSA County Committee to 
execute the policies of the FSA County Committee and be responsible for 
the day-to-day operations of the FSA county office or the person acting 
in such capacity.



Sec. 1230.608  Imported porcine animals, pork, and pork products.

    The term Imported porcine animals, pork, and pork products means 
those animals, pork, or pork products that are imported into the United 
States and subject to assessment under the harmonized tariff schedule 
numbers identified in Sec. 1230.110 of the regulations.



Sec. 1230.609  Importer.

    The term Importer means a person who imports porcine animals, pork, 
or pork products into the United States.



Sec. 1230.610  Order.

    The term Order means the Pork Promotion, Research, and Consumer 
Information Order.



Sec. 1230.611  Porcine animal.

    The term Porcine animal means a swine, that is raised:
    (a) As a feeder pig, that is, a young pig sold to another person to 
be finished over a period of more than 1 month for slaughtering;
    (b) For breeding purposes as seedstock and included in the breeding 
herd; and
    (c) As a market hog, slaughtered by the producer or sold to be 
slaughtered, usually within 1 month of such transfer.



Sec. 1230.612  Person.

    The term Person means any individual, group of individuals, 
partnership, corporation, association, cooperative, or any other legal 
entity.

[[Page 216]]



Sec. 1230.613  Pork.

    The term Pork means the flesh of a porcine animal.



Sec. 1230.614  Pork product.

    The term Pork product means an edible product processed in whole or 
in part from pork.



Sec. 1230.615  Producer.

    The term Producer means a person who produces porcine animals in the 
United States for sale in commerce.



Sec. 1230.616  Public notice.

    The term Public notice means information regarding a referendum that 
would be provided by the Secretary, such as press releases, newspapers, 
electronic media, FSA county newsletters, and the like. Such notice 
would contain the referendum date and location, registration and voting 
requirements, rules regarding absentee voting, and other pertinent 
information.



Sec. 1230.617  Referendum.

    The term Referendum means any referendum to be conducted by the 
Secretary pursuant to the Act whereby persons who have been producers 
and importers during a representative period would be given the 
opportunity to vote to determine whether producers and importers favor 
continuation of the Order.



Sec. 1230.618  Representative period.

    The term Representative period means the 12-consecutive months prior 
to the first day of absentee and importer voting in the referendum. The 
representative period for this referendum is August 18, 1999, through 
August 17, 2000.



Sec. 1230.619  Secretary.

    The term Secretary means the Secretary of Agriculture of the United 
States or any other officer or employee of the Department to whom there 
has been delegated or to whom authority may hereafter be delegated to 
act in the Secretary's stead.



Sec. 1230.620  State.

    The term State means each of the 50 States.



Sec. 1230.621  Voting period.

    The term Voting period means the 3-consecutive business day period 
for in-person voting.

                               Referendum



Sec. 1230.622  General.

    (a) A referendum to determine whether eligible pork producers and 
importers favor continuation of the Pork Checkoff Program will be 
conducted in accordance with this subpart.
    (b) The Pork Checkoff Program will be terminated only if a majority 
of producers and importers voting in the referendum favor such 
termination.
    (c) The referendum will be conducted at the county FSA offices for 
producers and at FSA headquarters office in Washington, DC, for 
importers.



Sec. 1230.623  Supervision of referendum.

    The Administrator, AMS, will be responsible for conducting the 
referendum in accordance with this subpart.



Sec. 1230.624  Eligibility.

    (a) Eligible producers and importers. Persons eligible to register 
and vote in the referendum include:
    (1) Individual Producers. Each individual that owns and sells at 
least one hog or pig during the representative period and does so in his 
or her own name is entitled to cast one ballot.
    (2) Producers who are a corporation or other entity. Each 
corporation or other entity that owns and sells at least one hog or pig 
during the representative period is entitled to cast one ballot. A group 
of individuals, such as members of a family, a partnership, owners of 
community property, or a corporation engaged in the production of hogs 
and pigs will be entitled to only one vote; provided, however, that any 
member of a group may register to vote as a producer if he or she sells 
at least one hog or pig in his or her own name.
    (3) Importers. Each importer who imports hogs, pigs, pork, or pork 
products during the representative period is entitled to cast one 
ballot. A group of individuals, such as members of a family, a 
partnership, or a corporation engaged in the importation of hogs, pigs, 
pork,

[[Page 217]]

or pork products will be entitled to only one vote; provided, however, 
that any member of a group may register to vote as a importer if he or 
she imports hogs, pigs, pork, or pork products in his or her own name.
    (b) Proxy registration and voting. Proxy registration and voting is 
not authorized, except that an officer or employee of a corporate 
producer or importer, or any guardian, administrator, executor, or 
trustee of a producer's or importer's estate, or an authorized 
representative of any eligible producer or importer (other than an 
individual producer or importer), such as a corporation or partnership, 
may register and cast a ballot on behalf of that entity. Any individual 
who registers to vote in the referendum on behalf of any eligible 
producer or importer corporation or other entity must certify that he or 
she is authorized to take such action.



Sec. 1230.625  Time and place of registration and voting.

    (a) Producers. The referendum shall be held for 3-consecutive days 
on September 19, 20, 21, 2000. Eligible producers shall register and 
vote on-site following the procedures in 1230.628. Producers shall 
register and vote during the normal business hours of each county FSA 
office or request absentee ballots from the county FSA offices by mail, 
telephone, or facsimile, or pick up an absentee ballot in-person. The 
absentee voting period shall be from August 18, 2000, through September 
21, 2000.
    (b) Importers. Importer voting shall take place during the same time 
period provided producers for in-person and absentee voting in the 
referendum. The referendum shall be conducted by mail ballot by the FSA 
headquarters office in Washington, DC, between August 18, 2000, through 
September 21, 2000.



Sec. 1230.626  Facilities for registering and voting.

    (a) Producers. Each county FSA office shall provide:
    (1) Adequate facilities and space to permit producers of hogs and 
pigs to register and to mark their ballots in secret;
    (2) A sealed box or other designated receptacle for registration 
forms and ballots that is kept under observation during office hours and 
secured at all times; and
    (3) Copies of the Order for review.
    (b) Absentee ballots. Each FSA county office shall provide each 
producer an absentee ballot package upon request. Producers can pick up 
an absentee ballot in-person or request it by telephone, mail, or 
facsimile. The FSA county office will provide absentee ballots by mail 
for all requests received by telephone, mail, or facsimile. The FSA 
county office shall record date of receipt of the ``Pork Referendum'' 
envelope containing the completed absentee ballot on the Absentee Voter 
Request List and place it unopened in a secure ballot box.
    (c) Importers. The FSA headquarters office in Washington, DC, will:
    (1) Mail ballot packages to eligible importers upon request;
    (2) Have a sealed box or other designated receptacle for 
registration forms and ballots that is kept under observation during 
office hours and secured at all times; and
    (3) Mail copies of the Order to importers if requested by mail, 
telephone, or facsimile. Importers can also pickup a ballot in-person.



Sec. 1230.627  Registration form and ballot.

    (a) Producers. (1) A ballot (Form LS-72) and combined registration 
and certification form (Form LS-72-2) will be used for voting in-person. 
The information required on the registration form includes name, 
address, and telephone number. Form LS-72-2 also contains the 
certification statement referenced in Sec. 1230.628. The ballot will 
require producers to check a ``yes'' or ``no.''
    (2) A combined registration and voting form (Form LS-73) will be 
used for absentee voting. The information required on this combined 
registration and voting form includes name, address, and telephone 
number. Form LS-73 also contains the certification statement referenced 
in Sec. 1230.628. The ballot will require producers to check ``yes'' or 
``no.''
    (b) Importers. A combined registration and ballot form (Form LS-76) 
will be

[[Page 218]]

used for importer voting. The information required on this combined 
registration and ballot form includes name, address, and telephone 
number. Form LS-76 also contains the certification statement referenced 
in Sec. 1230.629. The ballot will require importers to check ``yes'' or 
``no.''



Sec. 1230.628  Registration and voting procedures for producers.

    (a) Registering and voting in-person. (1) Each eligible producer who 
wants to vote whether as an individual or as a representative of a 
corporation or other entity shall register during the 3-day in-person 
voting period at the county FSA office where FSA maintains and processes 
the individual producer's or corporation's or other entities' 
administrative farm records. A producer voting as an individual or as a 
representative of a corporation or other entity not participating in FSA 
programs, shall register and vote in the county FSA office serving the 
county where the individual producer or corporation or other entity owns 
hogs or pigs. An individual or an authorized representative of a 
corporation or other entity who owns hogs or pigs in more than one 
county shall register and vote in the FSA county office where the 
individual or corporation or other entity does most of their business. 
Producers shall be required to record on the In-Person Voter 
Registration List (Form LS-75) their name and address, and if 
applicable, the name and address of the corporation or other entity they 
represent before they can receive a registration form and ballot. To 
register, producers shall complete the in-person registration and 
certification form (Form LS-72-2) and certify that:
    (i) They or the corporation or other entity they represent were 
producers during the specified representative period; and
    (ii) The person voting on behalf of a corporation or other entity 
referred to in Sec. 1230.612 is authorized to do so.
    (2) Each eligible producer who has not voted by means of an absentee 
ballot may cast a ballot in-person at the location and time set forth in 
Sec. 1230.625 and on September 19, 20, 21, 2000. Eligible producers who 
record their names and addresses and, if applicable, the name and 
address of the corporation or other entity they are authorized to 
represent on the In-Person Voter Registration List (Form LS-75) will 
receive a combined registration and certification form printed on an 
envelope (Form LS-72-2) and a ballot (Form LS-72). Producers will enter 
the information requested on the combined registration and certification 
form/envelope (Form LS-72-2) as indicated above. Producers will then 
mark their ballots to indicate ``yes'' or ``no.'' Producers will place 
their completed ballots in an envelope marked ``Pork Ballot'' (Form LS-
72-1), seal and place it in the completed and signed registration form/
envelope marked ``Pork Referendum'' (Form LS-72-2), seal that envelope 
and personally place it in a box marked ``Ballot Box'' or other 
designated receptacle. Voting will be conducted on-site under the 
supervision of the county FSA County Executive Director (CED).
    (b) Absentee voting. (1) Eligible producers who are unable to vote 
in-person may request an absentee voting package consisting of a 
combined registration and absentee ballot form (Form LS-73) and two 
envelopes--one marked ``Pork Ballot'' (Form LS-72-1) and the other 
marked ``Pork Referendum'' (Form LS-73-1) by mail, telephone, facsimile, 
or by picking up one in-person from the county FSA office where FSA 
maintains and processes the producer's administrative farm records.
    (2) If a producer, whether requesting an absentee ballot as an 
individual or as an authorized representative of a corporation or other 
entity that does not participate in FSA programs, and therefore does not 
have administrative records at a county FSA office, he or she may 
request an absentee voting package by telephone, mail, facsimile, or 
pick it up in-person from the county FSA office serving the county where 
the individual or corporation or other entity owns hogs or pigs. An 
individual or authorized representative of a corporation or other 
entity, who owns hogs or pigs in more than one county can request an 
absentee ballot from the county FSA office where the producer

[[Page 219]]

or corporation or other entity does most of their business.
    (3) An absentee voting package will be mailed to producers by the 
FSA CED to the address provided by the prospective voter. Only one 
absentee registration form and absentee ballot will be provided to each 
eligible producer. The absentee ballots and registration forms may be 
requested during August 1, 2000, through September 18, 2000.
    (4) The county FSA office will enter on the Absentee Voter Request 
List (Form LS-74) the name and address of the individual or corporation 
or other entity requesting an absentee ballot and the date the forms 
were requested.
    (5) To register, eligible producers shall complete and sign the 
combined registration and certification form and absentee ballot (Form 
LS-73) and certify that:
    (i) They or the corporation or other entity they represent were 
producers during the specified representative period;
    (ii) If voting on behalf of a corporation or other entity referred 
to in Sec. 1230.612, they are authorized to do so.
    (6) A producer, after completing the absentee voter registration 
form and marking the ballot, shall remove the ballot portion of the 
combined registration and absentee ballot form (Form LS-73) and seal the 
completed ballot in a separate envelope marked ``Pork Ballot'' (Form LS-
72-1) and place the sealed ``Pork Ballot'' envelope in the mailing 
envelope marked ``Pork Referendum'' (Form LS-73-1) along with the signed 
registration form. Producers are required to print their name and 
address on the mailing envelope marked ``Pork Referendum'' (Form LS-73-
1), and mail or hand deliver it to the county FSA office from which the 
producer or corporation or other entity obtained the absentee voting 
package. Absentee ballots returned in-person must be received by close 
of business on the last day of the in-person voting period, which is 
September 21, 2000. Ballots received after that date will be counted as 
invalid ballots.
    (7) Absentee ballots returned by mail have to be postmarked with a 
date not later than the last day of the in-person voting period, which 
is September 21, 2000, and be received in the county FSA office by the 
close of business on the 5th business day after the last day of the in-
person voting period, which is September 28, 2000. Absentee ballots 
received after that date will be counted as invalid ballots. Upon 
receiving the ``Pork Referendum'' envelope (Form LS-73-1) containing the 
registration form and ballot, the county FSA CED will record the date 
the ``Pork Referendum'' envelope (Form LS-73-1) containing the absentee 
ballot was received in the FSA county office on the Absentee Voter 
Request List (Form LS-74) opposite the name of the producer voting 
absentee. The county FSA CED will place it, unopened, in a secure ballot 
box.



Sec. 1230.629  Registration and voting procedures for importers.

    (a) Individual importers, corporations, or other entities can obtain 
the registration and certification forms, ballots, and envelopes by mail 
from the following address: USDA, FSA, Operations Review and Analysis 
Staff, Attention: William A. Brown, P.O. Box 44366, Washington, DC 
20026-4366. Importers may pick up the voting materials in-person at 
USDA, FSA, Operations Review and Analysis Staff, Room 2741, South 
Agriculture Building, 1400 Independence Avenue, SW., Washington, DC. 
Importers may also request voting materials by facsimile or telephone. 
The facsimile number is 202/690-3354. The telephone number is 202/720-
6833.
    (b) When requesting a ballot, eligible importers will be required to 
submit a U.S. Customs Service Form 7501 showing that they paid the pork 
assessment during the representative period.
    (c) Upon receipt of a request and U.S. Customs Service Form 7501, 
the voting materials will be mailed to importers by the FSA headquarters 
office in Washington, DC, to the address provided by the importer or 
importer corporation or other entity. Only one mail ballot and 
registration form will be provided to each eligible importer. The forms 
must be requested during August 1, 2000, through September 21, 2000.
    (d) The FSA headquarters office in Washington, DC, will enter on the 
Importer Ballot Request List (Form LS-

[[Page 220]]

77) the name and address of the importer requesting a ballot and the 
date of the request.
    (e) To register, eligible importers will complete and sign the 
combined registration form and ballot (Form LS-76) and certify that:
    (1) To the best of their knowledge and belief the information 
provided on the form is true and accurate;
    (2) If voting on behalf of an importer corporation or other entity 
referred to in Sec. 1230.612, they are authorized to do so.
    (f) Eligible importers, after completing the combined ballot and 
registration form, will remove the ballot portion of the combined 
registration and ballot form (Form LS-76) and seal the completed ballot 
in a separate envelope marked ``Pork Ballot'' (Form LS-72-1) and place 
the sealed ``Pork Ballot'' envelope in the mailing envelope marked 
``Pork Referendum'' (Form LS-73-1) along with the signed registration 
form. Importers, corporations, or other entities must legibly print 
their name and address on the mailing envelope marked ``Pork 
Referendum'' (Form LS-73-1), and mail the envelope to the FSA 
headquarters office at the following address: USDA, FSA, Operations 
Review and Analysis Staff, Attention: William A. Brown, Post Office Box 
44366, Washington, DC 20026-4366. Importers may hand deliver the ``Pork 
Referendum'' envelope to USDA, FSA, Operations Review and Analysis 
Staff, Room 2741, South Agriculture Building, 1400 Independence Avenue, 
SW., Washington, DC.
    (g) The ``Pork Referendum'' envelope (Form LS-73-1) containing the 
registration form and ballot has to be postmarked with a date not later 
than the last day of the in-person voting period, which is September 21, 
2000, and be received in the FSA headquarters office by the close of 
business on the 5th business day after the date of the last day of the 
in-person voting period, which is September 28, 2000. If delivered in-
person, it has to reach headquarters office not later than the last day 
of the in-person voting period. Ballots received after that date will be 
counted as invalid ballots. Upon receiving the ``Pork Referendum'' 
envelope (Form LS-73-1) containing the registration form and ballot, an 
FSA employee will record the date the ``Pork Referendum'' envelope 
containing the completed ballot was received in the FSA headquarters 
office in Washington, DC, on the Importer Ballot Request List (Form LS-
77) directly opposite the voting importer's name. The FSA employee will 
place the ``Pork Referendum'' envelope, unopened, in a secure ballot 
box.



Sec. 1230.630  List of registered voters.

    (a) Producers. The In-Person Voter Registration List (Form LS-75) 
and the Absentee Voter Request List (Form LS-74) will be available for 
inspection during the 3 days of the voting period and during the 7 
business days following the date of the last day of the voting period at 
the county FSA office. The lists will be posted during regular office 
hours in a conspicuous public location at the FSA county office. The 
Absentee and In-Person Voter Registration Lists will be updated and 
posted daily. The complete In-Person Voter Request List (Form LS-75) 
will be posted in the FSA county office on the 1st business day after 
the date of the last day of the voting period. The complete Absentee 
Voter Request List (Form LS-74) will be posted in the FSA county office 
on the 6th business day after the date of the last day of the voting 
period.
    (b) Importers. The Importer Ballot Request List (Form LS-77) will be 
maintained by the FSA headquarters office in Washington, DC, and not 
posted.



Sec. 1230.631  Challenge of votes.

    (a) Challenge period. During the dates of the 3-consecutive day 
voting period and the 7 business days following the voting period, the 
ballots of producers may be challenged at the FSA county office.
    (b) Who can challenge. Any person can challenge a producer's vote. 
Any person who wants to challenge shall do so in writing and shall 
include the full name of the individual or corporation or other entity 
being challenged. Each challenge of a producer vote must be made on a 
separate sheet of paper and each challenge must be signed by the 
challenger. The identity of the challenger will be kept confidential 
except

[[Page 221]]

as the Secretary may direct or as otherwise required by law.
    (c) Who can be challenged. Any producer having cast an in-person 
ballot or an absentee ballot whose name is posted on the In-Person Voter 
Registration List (Form LS-75) or the Absentee Voter Request List (Form 
LS-74) can be challenged. There is no challenge process for importers.
    (d) Notification of challenges. The FSA County Committee or its 
representative, acting on behalf the Administrator, AMS, will notify 
challenged producers as soon as practicable, but no later than 12 
business days after the date of the last day of the in-person voting 
period. FSA will notify all challenged persons that documentation such 
as sales documents, tax records, or other similar documents proving that 
the person owned and sold hogs or pigs during the representative period 
must be submitted or his or her vote will not be counted. The 
documentation must be provided to the FSA county offices within 5 
business days of notification and not later than 17 business days after 
the date of the last day of the voting period.
    (e) Determination of challenges. The FSA County Committee or its 
representative, acting on behalf of the Administrator, AMS, will make a 
determination concerning the challenge based on documentation provided 
by the producer and will notify challenged producers as soon as 
practicable, but no later than 22 business days after the date of the 
last day of the in-person voting period of its decision.
    (f) Challenged ballot. A challenge to a ballot shall be deemed to 
have been resolved if the determination of the FSA County Committee or 
its representative, acting on behalf of the Administrator, AMS, is not 
appealed within the time allowed for appeal or there has been a 
determination by the Administrator, AMS, after an appeal.
    (g) Appeal. A person declared to be ineligible to register and vote 
by the FSA County Committee or its representative, acting on behalf of 
the Administrator, AMS, can file an appeal at the FSA county office 
within 5 business days after the date of receipt of the letter of 
notification of ineligibility, but not later than November 2, 2000. The 
FSA county office shall send a producer's appeal by facsimile to the 
Administrator, AMS, on the date it is filed at the FSA county office or 
as soon as practical thereafter.
    (h) An appeal will be determined by the Administrator, AMS, as soon 
as practical, but in all cases not later than the 45th business day 
after the date of the last day of the voting period. The Administrator, 
AMS, shall send her decision on a producer's appeal to the FSA county 
office where the producer was initially challenged. The FSA county 
office shall notify the challenged producer of the Administrator's, AMS, 
determination on his or her appeal. The Administrator's, AMS, 
determination on an appeal shall be final.

[65 FR 43508, July 13, 2000, as amended at 65 FR 62579, Oct. 19, 2000]



Sec. 1230.632  Receiving ballots.

    (a) Producers. A ballot shall be considered to be received on time 
if:
    (1) It was cast in-person in the county FSA office prior to the 
close of business on the date of the last day of the in-person voting 
period; or
    (2) It was cast as an absentee ballot, having a postmarked date not 
later than the last day of the in-person voting period and was received 
in the county FSA office not later than the close of business, 5 
business days after the last day of the in-person voting period.
    (b) Importers. A ballot shall be considered to be received on time 
if it had a postmarked date not later than the date of the last day of 
the in-person voting period and was received in the FSA headquarters 
office in Washington, DC, not later than the close of business, 5 
business days after the last day of the in-person voting period.



Sec. 1230.633  Canvassing ballots.

    (a) Producers. (1) Counting the ballots. Under the supervision of 
FSA CED, acting on behalf of the Administrator, AMS, the in-person 
registration and certification form envelopes (Form LS-72-2) and the 
absentee ``Pork Referendum'' envelopes (Form LS-73-1) containing the 
``Pork Ballot'' envelopes for producer voters will be checked against 
the In-Person Voter Registration List (Form LS-75) and the

[[Page 222]]

Absentee Voter Request List (Form LS-74), respectively, to determine 
properly registered voters. The ballots of producers voting in-person 
whose names are not on the In-Person Voter Registration List (Form LS-
75), will be declared invalid. Likewise, the ballots of producers voting 
absentee whose names are not on the Absentee Voter Request List (Form 
LS-74) will be declared invalid. All ballots of challenged producer 
voters declared ineligible and invalid ballots will be kept separate 
from the other ballots and the envelopes containing these ballots will 
not be opened. The valid ballots will be counted on November 29, 2000, 
during regular business hours on the 46th business day after the last 
day of the in-person voting period. FSA county office employees will 
remove the sealed ``Pork Ballot'' envelopes (Form LS-72-1) from the 
registration form envelopes and ``Pork Referendum'' envelopes (absentee 
voting) envelopes of all eligible producer voters and all challenged 
producer voters determined to be eligible. After removing all ``Pork 
Ballot'' envelopes, FSA county employees will shuffle the sealed ``Pork 
Ballot'' envelopes or otherwise mix them up so that ballots cannot be 
matched with producers' names. After shuffling the ``Pork Ballot'' 
envelopes, FSA county employees will open them and count the ballots. 
The ballots will be counted as follows:
    (i) Number of eligible producers casting valid ballots;
    (ii) Number of producers favoring continuation of the Pork Checkoff 
Program;
    (iii) Number of producers favoring termination of the Pork Checkoff 
Program;
    (iv) Number of challenged producer ballots deemed ineligible;
    (v) Number of invalid ballots; and
    (vi) Number of spoiled ballots.
    (2) Invalid ballots. Ballots will be declared invalid if a producer 
voting in-person has failed to print his or her name and address on the 
In-Person Voter Registration List (Form LS-75) or if an absentee voter's 
name and address is not recorded on the Absentee Voter Request List 
(Form LS-74), or the registration form or ballot was incomplete or 
incorrectly completed.
    (3) Spoiled ballots. Ballots will be considered spoiled if they are 
mutilated or marked in such a way that it cannot be determined whether 
the voter is voting ``yes'' or ``no.'' Spoiled ballots shall not be 
considered as approving or disapproving the Pork Checkoff Program, or as 
a ballot cast in the referendum.
    (4) Confidentiality. All ballots shall be confidential and the 
contents of the ballots not divulged except as the Secretary may direct. 
The public may witness the opening of the ballot box and the counting of 
the votes but may not interfere with the process.
    (b) Importers. (1) Counting the ballots. FSA headquarters personnel, 
acting on behalf of the Administrator, AMS, will check the registration 
forms and ballots for all importer voters against the Importer Ballot 
Request List (Form LS-77) to determine properly registered voters. The 
ballots of importers voting whose names are not recorded on the Importer 
Ballot Request List (Form LS-77), will be declared invalid. All ballots 
of importer voters declared invalid will be kept separate from the other 
ballots and the envelopes containing these ballots will not be opened. 
The valid ballots will be counted on November 29, 2000, during regular 
office hours on the 46th business day after the date of the last day of 
the in-person voting period. FSA headquarter office employees will 
remove the sealed ``Pork Ballot'' envelope (Form LS-72-1) from the 
``Pork Referendum'' envelopes (Form LS-73-1) of all eligible importer 
voters. After removing all ``Pork Ballot'' envelopes, FSA headquarter 
employees will shuffle the sealed ``Pork Ballot'' envelopes or otherwise 
mix them up so that ballots cannot be matched with importers' names. 
After shuffling the ``Pork Ballot'' envelopes, FSA headquarters 
employees will open the envelopes and count the ballots. The ballots 
will be counted as follows:
    (i) Number of eligible importers casting valid ballots;
    (ii) Number of importers favoring continuation of the Pork Checkoff 
Program;
    (iii) Number of importers favoring termination of the Pork Checkoff 
Program;
    (iv) Number of importer ballots deemed invalid; and

[[Page 223]]

    (v) Number of spoiled ballots.
    (2) Invalid ballots. Ballots will be declared invalid if an importer 
voter's name was not recorded on the Importer Ballot Request List (Form 
LS-77), or the registration form or ballot was incomplete or incorrectly 
completed.
    (3) Spoiled ballots. Ballots will be considered spoiled if they were 
mutilated or marked in such a way that it cannot be determined whether 
the voter is voting ``yes'' or ``no.'' Spoiled ballots shall not be 
considered as a ballot cast in the referendum.
    (4) Confidentiality. All ballots shall be confidential and the 
contents of the ballots not divulged except as the Secretary may direct. 
The public can witness the opening of the ballot box and the counting of 
the votes but can not interfere with the process.



Sec. 1230.634  FSA county office report.

    The FSA county office will notify the FSA State office of the 
results of the referendum. Each FSA county office will transmit the 
results of the referendum in its county to the FSA State office. Such 
report will include the information listed in Sec. 1230.633. The 
results of the referendum in each county will be made available to the 
public, after the results of the referendum are announced by the 
Secretary. A copy of the report of results will be posted for 30 days in 
the FSA county office in a conspicuous place accessible to the public 
and a copy will be kept on file in the FSA county office for a period of 
at least 12 months after the referendum.



Sec. 1230.635  FSA State office report.

    Each FSA State office will transmit to the Administrator, FSA, a 
written summary of the results of the referendum received from all FSA 
county offices within the State. The summary shall include the 
information on the referendum results contained in the reports from all 
county offices within each State and be certified by the FSA State 
Executive Director. The FSA State office will maintain a copy of the 
summary where it will be available for public inspection for a period of 
not less than 12 months.



Sec. 1230.636  Results of the referendum.

    (a) The Administrator, FSA, will submit the combined results of the 
FSA State offices' results of the producers' vote and the FSA 
headquarters office results of the importers' vote to the Administrator, 
AMS. The Administrator, AMS, will prepare and submit to the Secretary a 
report of the results of the referendum. The results of the referendum 
will be announced by the Department in an official press release and 
published in the Federal Register. State reports on producer balloting, 
FSA headquarters office report on importer balloting, and related papers 
will be available for public inspection in the office of the Marketing 
Programs Branch, Livestock and Seed Program, AMS, USDA, Room 2627, South 
Agriculture Building, 1400 Independence Avenue, SW., Washington, DC.
    (b) If the Secretary deems it necessary, the report of producer 
voting results in any State or county or the report of importer voting 
results shall be reexamined and checked by such persons as may be 
designated by the Secretary.



Sec. 1230.637  Disposition of ballots and records.

    (a) Producer ballots and records. Each FSA CED will place in sealed 
containers marked with the identification of the referendum, the voter 
registration list, absentee voter request list, voted ballots, 
challenged registration forms/envelopes, challenged absentee voter 
registration forms, challenged ballots found to be ineligible, invalid 
ballots, spoiled ballots, and county summaries. Such records will be 
placed under lock in a safe place under the custody of the FSA CED for a 
period of not less than 12 months after the referendum. If no notice to 
the contrary is received from the Administrator, FSA, by the end of such 
time, the records shall be destroyed.
    (b) Importer ballots and records. The FSA headquarters office in 
Washington, DC, will deliver the importers' U.S. Customs Service Form 
7501s, the voter registration list, voted ballots, invalid ballots, 
spoiled ballots, and national summaries and records to the Marketing 
Programs Branch, Livestock and Seed Program, AMS, USDA,

[[Page 224]]

Room 2627, South Agriculture Building, 1400 Independence Avenue, SW., 
Washington, DC. A Marketing Programs Branch employee will place the 
ballots and records in sealed containers marked with the identification 
of the referendum. Such ballots and records will be placed under lock in 
a safe place under the custody of the Marketing Programs Branch for a 
period of not less than 12 months after the referendum. If no notice to 
the contrary is received from the Administrator, AMS, by the end of such 
time, the records shall be destroyed.



Sec. 1230.638  Instructions and forms.

    The Administrator, AMS, is authorized to prescribe additional 
instructions and forms not inconsistent with the provisions of this 
subpart to govern the conduct of the referendum.



Sec. 1230.639  Additional absentee voter challenge period.

    (a) Absentee Voter Request List. The Absentee Voter Request List 
(Form LS-74) will be available for inspection during an additional 
challenge period of five business days (October 23, 2000-October 27, 
2000) at county FSA offices. The Absentee Voter Request List will be 
posted daily during regular office hours in a conspicuous public 
location at FSA county offices during the additional challenge period.
    (b) Who can challenge. Any person can challenge a producer's vote 
during the period provided in paragraph (a) of this section. Any person 
who wants to challenge shall do so in writing and shall include the full 
name of the individual or corporation or other entity being challenged. 
Each challenge of a producer vote must be made on a separate sheet of 
paper and each challenge must be signed by the challenger. The identity 
of the challenger will be kept confidential except as the Secretary may 
direct or as otherwise required by law.
    (c) Who can be challenged. Any person whose name is on the Absentee 
Voter Request List who was not subject to challenge during the September 
19, 2000, through October 2, 2000, challenge period may be challenged. 
Those producers whose names were listed on the Absentee Voter Request 
List and who were subject to challenge because the Absentee Voter 
Request List indicated they had returned their ballot are not subject to 
challenge during this additional 5-day period.
    (d) Notification of challenges. The FSA County Committee or its 
representative, acting on behalf of the Administrator, AMS, will notify 
challenged producers as soon as practicable, but no later than the 2nd 
business day (October 31, 2000) after the last day of the additional 
challenge period. FSA county offices will notify all challenged persons 
that documentation such as sales documents, tax records, or other 
similar documents proving that the person owned and sold hogs or pigs 
during the representative period must be submitted or his or her vote 
will not be counted. The documentation must be provided to FSA county 
offices not later than November 7, 2000.
    (e) Determination of challenges. The FSA County Committee or its 
representative, acting on behalf of the Administrator, AMS, will make a 
determination concerning the challenge based on documentation provided 
by the producer and will notify challenged producers as soon as 
practicable but no later than November 9, 2000.
    (f) Challenged ballot. A challenge to a ballot shall be deemed to 
have been resolved if the determination of the FSA County Committee or 
its representative, acting on behalf of the Administrator, AMS, is not 
appealed within the time allowed for appeal or there has been a 
determination by the Administrator, AMS, after an appeal.
    (g) Appeal. A person declared to be ineligible to register and vote 
by the FSA County Committee or its representative, acting on behalf of 
the Administrator, AMS, can file an appeal at the FSA county office not 
later than November 17, 2000. The FSA county office shall send a 
producer's appeal by facsimile to the Administrator, AMS, on the date it 
is filed at the FSA office or as soon as practical thereafter.
    (h) Determination of appeals. An appeal will be determined by the 
Administrator, AMS, as soon as practical, but in all cases not later 
than the 45th business day (November 28, 2000) after the date of the 
last day of the voting period. The Administrator, AMS, shall

[[Page 225]]

send her decision on a producer's appeal to the FSA county office where 
the producer was initially challenged. The FSA county office shall 
notify the challenged producer of the Administrator's, AMS, 
determination on his or her appeal. The Administrator's, AMS, 
determination on an appeal shall be final.

[65 FR 62579, Oct. 19, 2000]



PART 1240_HONEY RESEARCH, PROMOTION, AND CONSUMER INFORMATION--Table 
of Contents




                               Definitions

   Subpart A_Honey Research, Promotion, and Consumer Information Order

Sec.
1240.1 Act.
1240.2 Board.
1240.3 Committee.
1240.4 Consumer education.
1240.5 Department or USDA.
1240.6 Exporter.
1240.7 Fiscal period and marketing year.
1240.8 Handle.
1240.9 Handler.
1240.10 Honey.
1240.11 Honey production.
1240.12 Honey products.
1240.13 Importer.
1240.14 Industry information.
1240.15 Marketing.
1240.16 National honey marketing cooperative.
1240.17 Part and subpart.
1240.18 Person.
1240.19 Plans and projects.
1240.20 Producer.
1240.21 Producer-packer.
1240.22 Promotion.
1240.23 Qualified national organization representing handler interests.
1240.24 Qualified national organization representing importer interests.
1240.25 Research.
1240.26 Secretary.
1240.27 State.
1240.28 State association.

                               Honey Board

1240.30 Establishment and membership.
1240.31 Term of office.
1240.32 Nominations.
1240.33 Board reconstitution.
1240.34 Vacancies.
1240.35 Procedure.
1240.36 Attendance.
1240.37 Powers.
1240.38 Duties.

    Research, Promotion, Consumer Education, and Industry Information

1240.39 Research, promotion, consumer education, and industry 
          information.

                        Expenses and Assessments

1240.40 Budget and expenses.
1240.41 Assessments.
1240.42 Exemption from assessment.
1240.43 Operating reserve.
1240.44 Voluntary quality assurance program.

                       Reports, Books, and Records

1240.50 Reports.
1240.51 Books and records.
1240.52 Confidential treatment.

                              Miscellaneous

1240.60 Influencing governmental action.
1240.61 Right of the Secretary.
1240.62 Suspension or termination.
1240.63 Proceedings after termination.
1240.64 Effect of termination or amendment.
1240.65 Personal liability.
1240.66 Separability.
1240.67 Patents, copyrights, inventions, product formulations, and 
          publications.

                 Subpart B_General Rules and Regulations

1240.100 Terms defined.
1240.105 Definitions.
1240.106 Communications.
1240.107 Policy and objective.
1240.108 Contracts.
1240.109 Procedure.
1240.110 U.S. Department of Agriculture costs.
1240.111 First handler and producer-packer.
1240.113 Importer.
1240.114 Exemption procedures.
1240.115 Levy of assessments.
1240.116 Payment of assessments.
1240.118 Reports of disposition of exempted honey.
1240.119 Reporting period and reports.
1240.120 Retention period for records.
1240.121 Availability of records.
1240.122 Confidential books, records, and reports.
1240.123 Right of the Secretary.
1240.124 Personal liability.
1240.125 OMB control numbers.

                     Subpart C_Referendum Procedures

1240.200 General.
1240.201 Definitions.
1240.202 Voting.
1240.203 Instructions.
1240.204 Subagents.
1240.205 Ballots.
1240.206 Referendum report.
1240.207 Confidential information.

    Authority: 7 U.S.C. 4601-4613; 7 U.S.C. 7401.

[[Page 226]]


    Source: 51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986, 
unless otherwise noted.

                               Definitions



   Subpart A_Honey Research, Promotion, and Consumer Information Order



Sec. 1240.1  Act.

    Act means the Honey Research, Promotion, and Consumer Information 
Act (Pub. L. 98-590) and any amendments thereto.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986. Redesignated at 
66 FR 21829, May 1, 2001]
Sec. 1240.2 Board.
    Board or National Honey Board means Honey Board, the administrative 
body established pursuant to Sec. 1240.30.

[66 FR 21829, May 1, 2001]



Sec. 1240.3  Committee.

    Committee means the National Honey Nominations Committee established 
pursuant to Sec. 1240.32.

[66 FR 21829, May 1, 2001]



Sec. 1240.4  Consumer education.

    Consumer education means the act of providing information to the 
public on the usage and care of honey and honey products.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986. Redesignated at 
66 FR 21829, May 1, 2001]



Sec. 1240.5  Department or USDA.

    Department or USDA means the United States Department of 
Agriculture.

[66 FR 21829, May 1, 2001]



Sec. 1240.6  Exporter.

    Exporter means any person who exports honey or honey products from 
the United States.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986. Redesignated at 
66 FR 21829, May 1, 2001]



Sec. 1240.7  Fiscal period and marketing year.

    Fiscal period and marketing year means the 12-month period ending on 
December 31 or such other consecutive 12-month period as shall be 
recommended by the Board and approved by the Secretary.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986. Redesignated at 
56 FR 37456, Aug. 7, 1991, and further redesignated at 66 FR 21829, May 
1, 2001]



Sec. 1240.8  Handle.

    Handle means to process, package, sell, transport, purchase or in 
any other way place honey or honey products, or cause them to be placed, 
in the current of commerce. This term shall include selling unprocessed 
honey that will be consumed without further processing or packaging. 
This term shall not include the transportation of unprocessed honey by a 
producer to a handler or transportation by a commercial carrier of 
honey, whether processed or unprocessed, for the account of the handler 
or producer. This term shall not include the purchase of honey or a 
honey product by a consumer or other end-user of the honey or honey 
product.

[66 FR 21829, May 1, 2001]



Sec. 1240.9  Handler.

    Handler means any person who handles honey or honey products.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986. Redesignated at 
66 FR 21829, May 1, 2001]



Sec. 1240.10  Honey.

    Honey means the nectar and saccharine exudations of plants which are 
gathered, modified, and stored in the comb by honey bees, including comb 
honey.

[66 FR 21829, May 1, 2001]



Sec. 1240.11  Honey production.

    Honey production means all beekeeping operations related to managing 
honey bee colonies to produce honey, harvesting honey from the colonies, 
extracting honey from the honeycombs, and preparing honey for sale and 
further processing.

[66 FR 21829, May 1, 2001]

[[Page 227]]



Sec. 1240.12  Honey products.

    Honey products means products wherein honey is a principal 
ingredient.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986. Redesignated at 
66 FR 21829, May 1, 2001]



Sec. 1240.13  Importer.

    Importer means any person who imports honey or honey products into 
the United States as principal or as an agent, broker, or consignee for 
any person who produces honey or honey products outside of the United 
States for sale in the United States, and who is listed in the import 
records as the importer of record for such honey or honey products.

[66 FR 21829, May 1, 2001]



Sec. 1240.14  Industry information.

    Industry information means information or a program that will lead 
to the development of new domestic and foreign markets, new marketing 
strategies, or increased efficiency for the honey industry, or an 
activity to enhance the image of honey and honey products and of the 
honey industry.

[66 FR 21830, May 1, 2001]



Sec. 1240.15  Marketing.

    Marketing means the sale or other disposition in commerce of honey 
or honey products.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986. Redesignated at 
56 FR 37456, Aug. 7, 1991]



Sec. 1240.16  National honey marketing cooperative.

    National honey marketing cooperative means a cooperative that 
markets its products in at least two of the following four regions of 
the United States, as determined by the Secretary:
    (a) The Atlantic Coast, including the District of Columbia and the 
Commonwealth of Puerto Rico;
    (b) The Mideast;
    (c) The Midwest; and
    (d) The Pacific, including the states of Alaska and Hawaii.

[66 FR 21830, May 1, 2001]



Sec. 1240.17  Part and subpart.

    Part means the Honey Research, Promotion, and Consumer Information 
Order and all rules, regulations, and supplemental orders issued 
thereunder, and the order shall be a ``subpart'' of such part.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986. Redesignated at 
56 FR 37456, Aug. 7, 1991, and further redesignated at 66 FR 21829, May 
1, 2001]



Sec. 1240.18  Person.

    Person means any individual, group of individuals, partnership, 
corporation, association, cooperative, or any other entity.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986. Redesignated at 
66 FR 21829, May 1, 2001]



Sec. 1240.19  Plans and projects.

    Plans and projects means those research, promotion, industry 
information, and consumer education plans, studies, or projects 
established pursuant to Sec. Sec. 1240.38 and 1240.39.

[66 FR 21830, May 1, 2001]



Sec. 1240.20  Producer.

    Producer means any person who produces honey in any State for sale 
in commerce.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986. Redesignated at 
66 FR 21829, May 1, 2001]



Sec. 1240.21  Producer-packer.

    Producer-packer means any person who is both a producer and handler 
of honey or honey products.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986. Redesignated at 
66 FR 21829, May 1, 2001]



Sec. 1240.22  Promotion.

    Promotion means any action, including paid advertising and public 
relations, to present a favorable image for honey or honey products to 
the public with the express intent of improving

[[Page 228]]

the competitive position and stimulating sales of honey or honey 
products.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986. Redesignated at 
56 FR 37456, Aug. 7, 1991, and further redesignated at 66 FR 21829, May 
1, 2001]



Sec. 1240.23  Qualified national organization representing handler 
interests.

    Qualified national organization representing handler interests means 
an organization that the Secretary certifies as being eligible to 
recommend nominations to the Committee for handler and alternate handler 
members of the Board under Sec. 1240.32.

[66 FR 21830, May 1, 2001]



Sec. 1240.24  Qualified national organization representing importer 
interests.

    Qualified national organization representing importer interests 
means an organization that the Secretary certifies as being eligible to 
recommend nominations to the Committee for importer and alternate 
importer members of the Board under Sec. 1240.32.

[66 FR 21830, May 1, 2001]



Sec. 1240.25  Research.

    Research means any type of systematic study or investigation, 
including studies testing the effectiveness of market development and 
promotion efforts, and/or the evaluation of any study or investigation 
designed to advance the image, desirability, usage, marketability, 
production, or quality of honey or honey products. Such term shall also 
include studies on bees to advance the cost effectiveness, 
competitiveness, efficiency, pest and disease control, and other 
management aspects of beekeeping, honey production, and honey bees.

[66 FR 21830, May 1, 2001]



Sec. 1240.26  Secretary.

    Secretary means the Secretary of Agriculture of the United States, 
or any other officer or employee of the Department of Agriculture to 
whom authority has heretofore been delegated, or to whom authority may 
hereafter be delegated, to act in his/her stead.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986. Redesignated at 
66 FR 21829, May 1, 2001]



Sec. 1240.27  State.

    State means any of the fifty States of the United States of America, 
the District of Columbia, and the Commonwealth of Puerto Rico.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986. Redesignated at 
56 FR 37456, Aug. 7, 1991, and further redesignated at 66 FR 21829, May 
1, 2001]



Sec. 1240.28  State association.

    State association or association means that organization of 
beekeepers in a State which is generally recognized as representing the 
beekeepers of that State.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986. Redesignated at 
66 FR 21829, May 1, 2001]

                               Honey Board



Sec. 1240.30  Establishment and membership.

    A Honey Board is established to administer the terms and provisions 
of this part. The Board shall consist of twelve (12) members, each of 
whom shall have an alternate. Seven members and seven alternates shall 
be honey producers; two members and two alternates shall be honey 
handlers; two members and two alternates shall be honey importers; and 
one member and one alternate shall be an officer, director, or employee 
of a national honey marketing cooperative. The Board shall be appointed 
by the Secretary from nominations submitted by the Committee, pursuant 
to Sec. 1240.32. Notwithstanding any other provision of this part, at 
least 50 percent of the members of the Board shall be honey producers.

[66 FR 21830, May 1, 2001]



Sec. 1240.31  Term of office.

    The members of the Board and their alternates shall serve for terms 
of three years, except that terms may be staggered periodically as 
recommended by the Board and as determined by the

[[Page 229]]

Secretary or as determined by the Secretary alone. No member or 
alternate shall serve more than two consecutive three-year terms. The 
term of office shall begin on April 1. Each Board member and alternate 
member shall continue to serve until the member's or alternate's 
successor meets all qualifications and is appointed by the Secretary.

[66 FR 21830, May 1, 2001]



Sec. 1240.32  Nominations.

    All nominations to the Board authorized under Sec. 1240.30 herein 
shall be made in the following manner.
    (a) Establishment of National Honey Nominations Committee.
    (1) There is established a National Honey Nominations Committee, 
which shall consist of not more than one member from each State, 
appointed by the Secretary from nominations submitted by each State 
beekeeper association. Wherever there is more than one eligible 
association within a State, the Secretary shall designate the 
association most representative of the honey producers, handlers, and 
importers not exempt under Sec. 1240.42 (a) and (b) to make nominations 
for that State.
    (2) If a State Association does not submit a nomination for the 
Committee, the Secretary may select a member of the honey industry from 
that State to represent that State on the Committee. However, if a State 
which is not one of the top twenty honey producing States (as determined 
by the Secretary) does not submit a nomination, such State shall not be 
represented on the Committee.
    (3) Members of the Committee shall serve for three-year terms, 
except that the term of appointments to the Committee may be staggered 
periodically, as determined by the Secretary. No member shall serve more 
than two consecutive three-year terms. The term of office shall begin on 
July 1.
    (4) The Committee shall select its Chairperson by a majority vote.
    (5) The members of the Committee shall serve without compensation, 
but shall be reimbursed for necessary and reasonable expenses incurred 
in performing their duties as members of the Committee and approved by 
the Board. Such expenses shall be paid from funds collected by the Board 
pursuant to Sec. 1240.41.
    (b) Nominations to the Board.
    (1) The Committee shall nominate the members and alternate members 
of the Board and submit such nominations promptly to the Secretary for 
approval.
    (2) The Committee shall meet annually to make such nominations, or, 
at the determination of the Chairperson, the Committee may conduct its 
business by mail ballot in lieu of an annual meeting.
    (3) A majority of the Committee shall constitute a quorum for voting 
at an annual meeting. In the event of a mail ballot, votes must be 
received from a majority of the Committee to constitute a quorum.
    (4) At least 50 percent of the members from the twenty leading 
honey-producing states must vote in any nomination of members to the 
Board.
    (5) For the purpose of nominating producer members to the Board, the 
Secretary shall establish seven regions on the basis of the production 
of honey. For the purpose of facilitating initial nominations to the 
Honey Board, the following regions shall be the initial regions:

Region 1: Washington, Oregon, Idaho, California, Nevada, Utah, Alaska, 
and Hawaii.
Region 2: Montana, Wyoming, Nebraska, Kansas, Colorado, Arizona, and New 
Mexico.
Region 3: North Dakota and South Dakota.
Region 4: Minnesota, Iowa, Wisconsin, and Michigan.
Region 5: Texas, Oklahoma, Missouri, Arkansas, Tennessee, Louisiana, 
Mississippi, and Alabama.
Region 6: Florida, Georgia, and Puerto Rico.
Region 7: Illinois, Indiana, Ohio, Kentucky, Virginia, North Carolina, 
South Carolina, West Virginia, Maryland, District of Columbia, Delaware, 
New Jersey, New York, Pennsylvania, Connecticut, Rhode Island, 
Massachusetts, New Hampshire, Vermont, and Maine.

    (6) In nominating producer members to the Board, no producer-packer 
who, during any three of the preceding five years, purchased for resale 
more honey than the producer-packer produced shall be eligible for 
nomination or appointment to the Board as a producer or as an alternate 
to a producer.

[[Page 230]]

    (7) In nominating importer members to the Board, no importer who, 
during any three of the preceding five years, did not receive at least 
75 percent of the gross income generated by the sale of honey and honey 
products from the sale of imported honey and honey products shall be 
eligible for nomination or appointment to the Board as an importer or as 
an alternate to an importer.
    (8) Six months before the new Board term begins, the Committee shall 
submit to the Secretary nominations for positions on the Board. The 
number of nominations will directly correspond to the number of 
producer, handler, importer, and cooperative member positions due to 
become vacant. Selection of nominees by the Committee will be pursuant 
to the following:
    (i) Nominations for producer members and alternate producer members 
will be from the regions in which one or more vacancies will occur;
    (ii) Nominations for handler members and alternate handler members 
will be based on recommendations made by qualified national 
organizations representing handler interests, or, if the Secretary 
determines that there is not a qualified national organization 
representing handler interests, by individual handlers who have paid 
assessments to the Board on honey or honey products handled;
    (iii) Nominations for importer members and alternate importer 
members will be based on recommendations made by qualified national 
organizations representing importer interests, or, if the Secretary 
determines that there is not a qualified national organization 
representing importer interests, by individual importers who have paid 
assessments to the Board on imported honey or honey products; and
    (iv) Nominations for a member and alternate member who are officers, 
directors, or employees of national honey marketing cooperatives will be 
based on recommendations made by qualified national honey marketing 
cooperatives.
    (9) Qualified national organization representing handler interests. 
To be certified by the Secretary as a qualified national organization 
representing handler interests, an association or organization must meet 
the following criteria, as evidenced in a factual report submitted by 
the association or organization to the Secretary:
    (i) The organization's membership is comprised primarily of honey 
handlers;
    (ii) The organization represents a substantial number of handlers 
who handle a substantial volume of honey in at least 20 states;
    (iii) The organization has a history of stability and permanency;
    (iv) A primary or overriding purpose of the organization is to 
promote the economic welfare of honey handlers;
    (v) A portion of the operating funds of the organization are derived 
from handlers; and
    (vi) The organization demonstrates the ability and willingness to 
further the purposes of the Act.
    (10) Qualified national organization representing importer 
interests. To be certified as a qualified national organization 
representing importer interests, an association or organization must 
meet the following criteria, as evidenced in a factual report submitted 
by the association or organization to the Secretary:
    (i) The organization's total paid membership is comprised of a 
significant number of importers or the organization's total paid 
membership represents at least a majority of the volume of honey 
imported into the United States;
    (ii) The organization has a history of stability and permanency;
    (iii) A primary or overriding purpose of the organization is to 
promote the economic welfare of honey importers;
    (iv) Substantial geographic territory is covered by the active 
membership of the organization;
    (v) A portion of the operating funds of the organization are derived 
from importers; and
    (vi) The organization demonstrates the ability and willingness to 
further the purposes of the Act.
    (11) As a condition of certification by the Secretary as a qualified 
national organization representing handler or importer interests, an 
organization shall agree to:
    (i) Notify handlers and importers who are not members of the 
organization of Board nomination opportunities for

[[Page 231]]

which the organization is certified to make recommendations to the 
Committee; and
    (ii) Consider the nomination of handlers and importers who are not 
members when making the nominations of the organization to the 
Committee, if nonmembers indicate an interest in serving on the Board.
    (12) A certification determination by the Secretary of a qualified 
organization representing handler or importer interests shall be final.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986, as amended at 
56 FR 37456, Aug. 7, 1991; 66 FR 21830, May 1, 2001]



Sec. 1240.33  Board reconstitution.

    (a) Every five years, the Board shall review the geographic 
distribution of the quantities of domestically produced honey assessed 
under this subpart and the changes in the annual average percentage of 
assessments owed by importers under this subpart relative to assessments 
owed by producers of domestic honey. The Board shall conduct the initial 
review required by this paragraph prior to the first continuance 
referendum conducted after May 31, 2001.
    (b)(1) If warranted as a result of this review, the Board shall 
recommend for the Secretary's approval:
    (i) Changes in the regional representation of honey producers; and/
or
    (ii) The addition of Board members.
    (2) If such allocations are necessary to reflect changes in the 
proportion of domestic and imported honey assessed under this subpart or 
the source of assessments on imported honey or honey products, the Board 
may not recommend the addition of members pursuant to paragraph 
(b)(1)(ii) of this section unless the proportion of assessments owed by 
importers compared with the proportion of assessments owed on domestic 
honey by producers changed by more than 6 percent from the base period 
proportion determined in accordance with paragraph (d) of this section.
    (c) Except as provided in paragraph (d) of this section, 
recommendations made under paragraph (b) of this section shall be based 
on the 5-year average annual assessments, excluding the 2 years 
containing the highest and lowest disparity between the proportion of 
assessments owed from imported and domestic honey or honey products, 
determined pursuant to the review that is conducted under paragraph (a) 
of this section.
    (d) The base period proportions for determining the magnitude of 
change under paragraph (c) of this section shall be the proportions 
determined during the prior review conducted under this section. In the 
case of the initial review, the base period proportions shall be the 
proportions determined by the Board for fiscal period 1996.
    (e) Notwithstanding any other provision of this section, at least 50 
percent of the members of the Board shall be honey producers.
    (f) Any such reallocation or addition of members shall be made at 
least six months prior to the date on which terms of office of the Board 
begin each year and shall become effective at least 30 days prior to 
such date.

[66 FR 21831, May 1, 2001]



Sec. 1240.34  Vacancies.

    (a) In the event any member of the Board ceases to be a member of 
the category of members from which the member was appointed to the 
Board, such position shall automatically become vacant: Provided, That 
if, as a result of Board reconstitution pursuant to Sec. 1240.33, a 
producer member or alternate is no longer from the region from which 
such person was appointed, the affected member and/or alternate may 
serve out the term for which such person was appointed, or if a member, 
whose position is based on the member's status as an importer is subject 
to reallocation by the Board, the affected member and/or alternate may 
serve out the term for which such person was appointed.
    (b) If a member of the Board consistently refuses to perform the 
duties of a member of the Board, or if a member of the Board engages in 
acts of dishonesty or willful misconduct, the Board may recommend to the 
Secretary that the member be removed from office. If the Secretary finds 
the recommendation of the Board shows adequate cause, the Secretary 
shall remove such member from office.

[[Page 232]]

    (c) Should any member position become vacant, the alternate of that 
member shall automatically assume the position of said member. At its 
next meeting, the Committee shall nominate a replacement for said 
alternate. Should the positions of both a member and such member's 
alternate become vacant, successors for the unexpired terms of such 
member and alternate shall be nominated and appointed in the manner 
specified in Sec. Sec. 1240.30 and 1240.32, except that said nomination 
and replacement shall not be required if said unexpired terms are less 
than six months.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986, as amended at 
56 FR 37456, Aug. 7, 1991; 66 FR 21831, May 1, 2001]



Sec. 1240.35  Procedure.

    (a) A majority of members, of which at least 50 percent are 
producers, including alternates acting in place of members of the Board, 
shall constitute a quorum: Provided, That such alternates shall serve 
only whenever the member is absent from a meeting or is disqualified. 
Any action of the Board shall require the concurring votes of a majority 
of those present and voting. At assembled meetings, all votes shall be 
cast in person.
    (b) In matters of an emergency nature when there is not enough time 
to call an assembled meeting of the Board, the Board may act upon the 
concurring votes of a majority of its members by mail, telephone, 
telegraph, or by other means of communication: Provided, That each 
proposition is explained accurately, fully, and substantially 
identically to each member. All telephone votes shall be promptly 
confirmed in writing and recorded in the Board minutes.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986, as amended at 
66 FR 21832, May 1, 2001]



Sec. 1240.36  Attendance.

    Members of the Board and the members of any special panels shall be 
reimbursed for reasonable out-of-pocket expenses incurred when 
performing Board business. The Board shall have the authority to request 
the attendance of alternates of any or all meetings, notwithstanding the 
expected or actual presence of the respective members.



Sec. 1240.37  Powers.

    The Board shall have the following powers subject to Sec. 1240.61:
    (a) To administer this subpart in accordance with its terms and 
provisions of the Act;
    (b) To make rules and regulations to effectuate the terms and 
conditions of this subpart;
    (c) To require its employees to receive, investigate, and report to 
the Secretary complaints of violations of this part; and
    (d) To recommend to the Secretary amendments to this part.



Sec. 1240.38  Duties.

    The Board shall have, among other things, the following duties:
    (a) To meet and organize and to select from among its members a 
chairperson and such other officers as may be necessary; to select 
committees and subcommittees from its membership and consultants; to 
adopt such rules, regulations, and by-laws for the conduct of its 
business as it may deem advisable.
    (b) To employ such persons as it may deem necessary and to determine 
the compensation and define the duties of each; and to protect the 
handling of Board funds through fidelity bonds;
    (c) To prepare and submit to the Secretary for approval 60 days in 
advance of the beginning of a fiscal period, a budget of its anticipated 
expenses in the administration of this part including the probable costs 
of all programs and plans and to recommend a rate of assessment with 
respect thereto;
    (d) To investigate violations of this part and report the results of 
such investigations to the Secretary for appropriate action to enforce 
the provisions of this part;
    (e) To develop programs and plans and to enter into contracts or 
agreements with the approval of the Secretary for the development and 
carrying out of programs and plans of research, promotion, advertising, 
consumer education, or industry information and the payment of the costs 
thereof with funds collected pursuant to this part;

[[Page 233]]

    (f) To maintain minutes, books, and records and prepare and submit 
to the Secretary such reports from time to time as may be required for 
appropriate accounting with respect to the receipt and disbursement of 
funds entrusted to it;
    (g) To periodically prepare and make public and to make available to 
producers, handlers, producer-packers, and importers, reports of its 
activities carried out and, at least once each fiscal period, to make 
public an accounting of funds received and expended;
    (h) To cause its books to be audited by a certified public 
accountant at the end of each fiscal period and to submit a copy of each 
audit to the Secretary;
    (i) To give to the Secretary the same notice of meetings of the 
Board and subcommittees as is given to members in order that 
representatives of the Secretary may attend such meetings;
    (j) To submit to the Secretary such information pertaining to this 
subpart as the Secretary may request;
    (k) To notify honey producers, producer-packers, handlers, and 
importers of all Board meetings through press releases or other means;
    (l) To appoint and convene, from time to time, working committees 
which may include producers, handlers, producer-packers, importers, 
exporters, members of wholesale or retail outlets for honey, or other 
members of the public to assist in the development of research, 
promotion, advertising, consumer education, and industry information 
programs for honey; and
    (m) To develop and recommend such rules and regulations to the 
Secretary for approval as may be necessary for the development and 
execution of plans or activities to effectuate the declared purpose of 
the Act.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986, as amended at 
56 FR 37456, Aug. 7, 1991; 66 FR 21832, May 1, 2001]

    Research, Promotion, Consumer Education, and Industry Information



Sec. 1240.39  Research, promotion, consumer education, and industry 
information.

    (a) Scope of activities. The Board shall develop and submit to the 
Secretary for approval any plans, programs, or projects authorized in 
this section. Such plans, programs, and projects shall provide for:
    (1) The establishment, issuance, effectuation, and administration of 
appropriate plans, programs, or projects for consumer education, 
industry information, advertising, and promotion of honey and honey 
products designed to strengthen the position of the honey industry in 
the marketplace and to maintain, develop, and expand markets for honey 
and honey products;
    (2) The establishment and conduct of marketing research and 
development plans to the end that the acquisition of knowledge 
pertaining to honey and honey products or their consumption and use may 
be encouraged or expanded, or to the end that the marketing and 
utilization of honey and honey products may be encouraged, expanded, 
improved, or made more efficient: Provided, That supply management 
programs or other programs that would otherwise limit the right of the 
individual honey producer to produce honey shall not be conducted under, 
or as a part of, this subpart;
    (3) The development and expansion of honey and honey product sales 
in foreign markets;
    (4) A prohibition on advertising or other promotion programs that 
make any false or unwarranted claims on behalf of honey or its products 
or false or unwarranted statements with respect to the attributes or use 
of any competing product;
    (5) The sponsorship of research designed to advance the cost-
effectiveness, competitiveness, efficiency, pest and disease control, 
and other management aspects of beekeeping, honey production, and honey 
bees;
    (6) The conduct of activities which may lead to the development of 
new markets or marketing strategies for honey or honey products. In 
addition, the Board may conduct activities designed to increase the 
efficiency of the honey industry or activities to enhance the image of 
honey and honey products and the honey industry;
    (7) Periodic evaluation by the Board of each plan, program, or 
project authorized under this part to insure that each plan, program, or 
project contributes to an effective and coordinated

[[Page 234]]

program of research, promotion, consumer education, and industry 
information and submit such evaluation to the Secretary. If the Board or 
the Secretary finds that a plan, program, or project does not further 
the purposes of the Act, then the Board shall terminate such plan, 
program, or project; and
    (8) The Board to enter into contracts or make agreements for the 
development and carrying out of research, promotion, consumer education, 
and industry information programs, and pay for the costs of such 
contracts or agreements with funds received by the Board.
    (b) Independent evaluation. In addition to any evaluation that may 
be carried out pursuant to paragraph (a)(7) of this section, the Board 
shall, not less often than every five years, authorize and fund, from 
funds otherwise available to the Board, an independent evaluation of the 
effectiveness of this subpart and other plans, programs, and projects 
conducted by the Board pursuant to the Act. The Board shall submit to 
the Secretary, and make available to the public, the results of each 
periodic independent evaluation conducted under this paragraph.

[66 FR 21832, May 1, 2001]

                        Expenses and Assessments



Sec. 1240.40  Budget and expenses.

    (a) Sixty days in advance of the beginning of each fiscal period, or 
as may be necessary thereafter, the Board shall prepare and recommend a 
budget on a fiscal period basis of its anticipated expenses and 
disbursements in the administration of this subpart, including expenses 
of the Committee and probable costs of research, promotion, consumer 
education, and industry information.
    (b) The Board is authorized to incur expenses for: research, 
promotion, consumer education, and industry information; such other 
expenses for the administration, maintenance, and functioning of the 
Board and the Committee as may be authorized by the Secretary; any 
operating reserve established pursuant to Sec. 1240.43; and those 
administrative costs incurred by the Department specified in paragraph 
(d) of this section. The funds to cover such expenses shall be paid from 
assessments collected pursuant to Sec. 1240.41, donations from any 
person not subject to assessments under this subpart, and other funds 
available to the Board including those collected pursuant to Sec. 
1240.67 and subject to the limitationscontained in that section.
    (c) The Board shall reimburse the Department from assessments for 
administrative costs incurred by the Department with respect to this 
order after its promulgation. The Department shall also be reimbursed 
for administrative expenses incurred by it for the conduct of referenda.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986, as amended at 
66 FR 21832, May 1, 2001]



Sec. 1240.41  Assessments.

    (a) Domestic honey and honey products. The assessment rate on honey 
produced in the United States and handled shall be 1 cent per pound of 
honey produced.
    (b) Imported honey and honey products. The assessment rate on honey 
or honey products imported into the United States shall be 1 cent per 
pound of honey or honey products imported. The importer of imported 
honey and honey products shall pay the assessment to the Board through 
the U.S. Customs Service at the time of entry of such honey and honey 
products into the United States. Should the U.S. Customs Service fail to 
collect an assessment from an importer, the importer shall be 
responsible for the payment of the assessment to the Board.
    (c) General. (1) Except as provided in Sec. 1240.42 and in 
paragraphs (c)(2) and (e) of this section, the first handler shall be 
responsible for the collection of such assessment from the producer and 
payment thereof to the Board. The first handler shall maintain separate 
records for each producer's honey handled, including honey produced by 
said handler.
    (2) Producer-packers shall pay to the Board the assessment on all 
honey or honey products for which they act as first handler, in addition 
to the assessment owed on honey they produce.
    (3) Should a first handler fail to collect an assessment from a 
producer, the producer shall be responsible for

[[Page 235]]

the payment of the assessment to the Board.
    (4) Assessments shall be paid to the Board at such time and in such 
manner as the Board, with the Secretary's approval, directs pursuant to 
this part. Such regulations may provide for different handler, importer, 
producer, or producer-packer payment schedules so as to recognize 
differences in marketing or purchasing practices and procedures.
    (d) Late payment. (1) There shall be a late-payment charge imposed 
on any importer, handler, or producer-packer who fails to remit to the 
Board the total amount for which any such importer, producer, or 
producer-packer is liable on or before the payment due date established 
by the Board. The amount of the late-payment charge shall be set by the 
Board subject to approval by the Secretary.
    (2) There shall also be imposed on any importer, handler, or 
producer-packer subject to a late-payment charge, an additional charge 
in the form of interest on the outstanding portion of any amount for 
which the importer, handler, or producer-packer is liable. The rate of 
interest shall be prescribed in regulations issued by the Secretary.
    (3) Persons failing to remit total assessments due in a timely 
manner may also be subject to actions under federal debt collection 
procedures.
    (e) Honey under loan. Whenever a loan is made on honey under an USDA 
loan program, the Secretary shall provide that the assessment be 
deducted from the proceeds of the loan or the loan deficiency payment, 
if applicable, and that the amount of such assessment shall be forwarded 
to the Board, except that the assessment shall not be deducted by the 
Secretary in the case of a honey marketing cooperative approved by the 
Department's Commodity Credit Corporation that deducts the assessment 
from its member producers. As soon as practicable after the assessment 
is deducted from the loan funds or loan deficiency payment, the 
Secretary shall provide the producer with proof of payment of the 
assessment.
    (f) Advance payment. The Board is authorized to accept advance 
payment of assessments by handlers, importers, or producer-packers that 
shall be credited toward any amount for which the handlers, importers, 
or producer-packers may become liable. The Board is not obligated to pay 
interest on any advance payment.

[66 FR 21833, May 1, 2001]



Sec. 1240.42  Exemption from assessment.

    (a) A producer who produces less than 6,000 pounds of honey per 
year, a producer-packer who produces and handles less than 6,000 pounds 
of honey or honey products per year, or an importer who imports less 
than 6,000 pounds of honey or honey products per year shall be exempt 
from assessment: Provided, such honey or honey products are distributed 
directly through local retail outlets such as roadside stands, farmers 
markets, groceries, or other outlets as otherwise determined by the 
Secretary during such year.
    (b) A producer or importer who consumes honey at home or donates 
honey to a nonprofit, government, or other entity, as determined 
appropriate by the Secretary, rather then sell such honey, shall be 
exempt from the assessment on that honey so consumed or donated, except 
for honey donated that is later sold in a commercial outlet by a donee 
or donee's assignee.
    (c) If, after a person has been exempt from paying assessments for 
any year under this section, and such person no longer meets the 
requirements of this section for an exemption, such person shall file a 
report with the Board in the form and manner prescribed by the Board and 
pay an assessment on or before March 15 of the subsequent year on all 
honey or honey products produced or imported by such person during the 
year for which the person claimed the exemption.
    (d) The Board may recommend to the Secretary that honey exported 
from the United States be exempted from the provisions of this subpart 
and include procedures for the refund of assessments on such honey and 
such safeguards as may be necessary to prevent improper use of this 
exemption.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986, as amended at 
56 FR 37457, Aug. 7, 1991; 66 FR 21833, May 1, 2001]

[[Page 236]]



Sec. 1240.43  Operating reserve.

    The Board may establish an operating monetary reserve and may carry 
over to subsequent fiscal periods excess funds in any reserve so 
established: Provided, That the funds in the reserve shall not exceed 
one fiscal period's budget. Subject to approval by the Secretary, such 
reserve funds may be used to defray any expenses authorized under this 
part.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986. Redesignated at 
66 FR 21829, May 1, 2001]



Sec. 1240.44  Voluntary quality assurance program.

    (a) The Board is authorized to develop and carry out a voluntary 
quality assurance program concerning purity standards for honey and 
honey products. The Secretary shall have the authority to approve or 
disapprove such program.
    (b) The program may include the following components:
    (1) The establishment of an official Board seal of approval to be 
displayed on honey and honey products which meet such standards of 
purity as are established under the program;
    (2) Actions to encourage producers, handlers, and importers to 
participate in the program;
    (3) Actions to encourage consumers to purchase honey and honey 
products bearing the official seal of approval; and
    (4) Periodic inspections by the Secretary, or other parties approved 
by the Secretary, of honey and honey products of persons who participate 
in the program.
    (c) To be eligible to display the official seal of approval under 
paragraph (b)(1) of this section on a honey or honey product, a 
producer, handler, or importer shall participate in the voluntary 
program described in paragraph (a) of this section.

[66 FR 21833, May 1, 2001]

                       Reports, Books, and Records



Sec. 1240.50  Reports.

    Each handler, importer, producer, or producer-packer subject to this 
part shall be required to report to the employees of the Board, at such 
time and in such manner as it may prescribe, such information as may be 
necessary for the Board to perform its duties. Such reports shall 
include, but shall not be limited to the following:
    (a) For producers or producer-packers: the quantity of honey 
produced and the total number of bee colonies maintained.
    (b) For handlers and producer-packers: the total quantity of honey 
acquired during the reporting period; the total quantity of honey and 
honey products handled during such period; the amount of honey acquired 
from each producer, giving the name and address of each producer; the 
assessments collected during the reporting period; the quantity of honey 
processed for sale from a producer-packer's own production; and a record 
of each transaction for honey on which assessments had already been 
paid, including a statement from the seller that the assessment had been 
paid.
    (c) For importers: the total quantity of honey and honey products 
imported during the reporting period and a record of each importation of 
honey or honey products during such period, giving the quantity, date, 
country of origin, and port of entry.
    (d) For persons who have an exemption from assessments under Sec. 
1240.42(a) and (b), such information as deemed necessary by the Board, 
and approved by the Secretary, concerning the exemption including 
disposition of exempted honey.

[66 FR 21834, May 1, 2001]



Sec. 1240.51  Books and records.

    Each handler, importer, producer, producer-packer, or any person who 
is exempt from assessments under this subpart shall maintain and during 
normal business hours make available for inspection by employees or 
agents of the Board or the Secretary, such books and records as are 
necessary to carry out the provisions of this part, including such 
records as are necessary to verify any required reports. A member or 
alternate member of the Board is prohibited from conducting such 
inspections. Such books and records shall

[[Page 237]]

be maintained for two years beyond the fiscal period of their 
applicability.

[66 FR 21834, May 1, 2001]



Sec. 1240.52  Confidential treatment.

    All information obtained from the books, records, or reports 
required to be maintained under Sec. Sec. 1240.50 and 1240.51 shall be 
kept confidential by all employees and agents of the Board and all 
officers and employees of the Department and shall not be disclosed to 
the public. Only such information as the Secretary deems relevant shall 
be disclosed to the public and then only in a suit or administrative 
hearing brought at the direction, or upon the request, of the Secretary, 
or to which the Secretary or any officer of the United States is a 
party, and involving this subpart: Except that nothing in this subpart 
shall be deemed to prohibit:
    (a) The issuance of general statements based upon the reports of a 
number of handlers or importers subject to this subpart, if such 
statements do not identify the information furnished by any person;
    (b) The publication by direction of the Secretary of the name of any 
person convicted of violating this subpart, together with a statement of 
the particular provisions of this subpart violated by such person.

[66 FR 21834, May 1, 2001]

                              Miscellaneous



Sec. 1240.60  Influencing governmental action.

    No funds collected by the Board under this order shall in any manner 
be used for the purpose of influencing governmental policy or action, 
except for making recommendations to the Secretary as provided for in 
this subpart.



Sec. 1240.61  Right of the Secretary.

    All fiscal matters, programs or plans, rules or regulations, 
reports, or other substantive actions proposed and prepared by the Board 
shall be submitted to the Secretary for approval.

[66 FR 21834, May 1, 2001]



Sec. 1240.62  Suspension or termination.

    (a) The Secretary shall, whenever the Secretary finds that this 
subpart or any provision thereof obstructs or does not tend to 
effectuate the declared policy of the Act, terminate or suspend the 
operation of this subpart or such provisions thereof.
    (b) Except as otherwise provided in paragraph (c) of this section, 
five years from the date the Secretary issues an order authorizing the 
collection of assessments on honey under provisions of this subpart, and 
every five years thereafter, the Secretary shall conduct a referendum to 
determine if honey producers and importers favor the termination or 
suspension of this subpart.
    (c) The Secretary shall hold a referendum on the request of the 
Board, or when petitioned by 10 percent or more of the honey producers 
and importers subject to assessment under this subpart to determine if 
the honey producers and importers favor termination or suspension of 
this subpart. A referendum under this paragraph may not be held more 
than once every two (2) years. If the Secretary determines, through a 
referendum conducted pursuant to this paragraph, that continuation of 
this subpart is approved, any referendum otherwise required to be 
conducted under paragraph (b) of this section shall not be held less 
than five (5) years after the date the referendum was conducted under 
this paragraph.

[51 FR 26148, July 21, 1986; 51 FR 29210, Aug. 15, 1986, as amended at 
56 FR 37457, Aug. 7, 1991; 66 FR 21834, May 1, 2001]



Sec. 1240.63  Proceedings after termination.

    (a) Upon the termination of this subpart, the Board shall recommend 
to the Secretary not more than five of its members to serve as trustees 
for the purpose of liquidating the affairs of the Board. Such persons, 
upon designation by the Secretary, shall become trustees of all funds 
and property then in possession or under control of the Board, including 
claims for any funds unpaid or property not delivered or any other claim 
existing at the time of such termination.
    (b) The said trustees shall:
    (1) Continue in such capacity until discharged by the Secretary;

[[Page 238]]

    (2) Carry out the obligations of the Board under any contracts or 
agreements entered into by it pursuant to Sec. 1240.38;
    (3) From time to time account for all receipts and disbursements and 
deliver all property on hand, together with all books and records of the 
Board and of the trustees, to such person as the Secretary may direct; 
and
    (4) Upon the direction of the Secretary, execute such assignments or 
other instruments necessary or appropriate to vest in such person full 
title and right to all of the funds, property, and claims vested in the 
Board or the trustees pursuant to this subpart.
    (c) Any person to whom funds, property, or claims have been 
transferred or delivered pursuant to this subpart shall be subject to 
the same obligations as imposed upon the trustees.
    (d) Any residual funds not required to defray the necessary expenses 
of liquidation shall be returned to the persons who contributed such 
funds, or paid assessments, or if not practicable, shall be turned over 
to the Department to be utilized, to the extent practicable, in the 
interest of continuing one or more of the honey research or education 
programs hitherto authorized.



Sec. 1240.64  Effect of termination or amendment.

    Unless otherwise expressly provided by the Secretary, the 
termination of this subpart or any regulation issued thereunder, or the 
issuance of any amendment to either thereof, shall not:
    (a) Affect or waive any right, duty, obligation, or liability which 
shall have arisen or which may thereafter arise in connection with any 
provision of this subpart or any regulation issued thereunder;
    (b) Release or extinguish any violation of this subpart or of any 
regulation issued thereunder; or
    (c) Affect or impair any rights or remedies of the United States, or 
of any person, with respect to any such violation.



Sec. 1240.65  Personal liability.

    No member, alternate member, or employee of the Board shall be held 
personally responsible, either individually or jointly with others, in 
any way whatsoever to any person for errors in judgment, mistakes, or 
other acts, either of commission or omission, as such member, alternate 
member, or employee, except for acts of dishonesty or willful 
midconduct.



Sec. 1240.66  Separability.

    If any provision of this subpart is declared invalid or the 
applicability thereof to any person or circumstance is held invalid, the 
validity of the remainder of this subpart, or the applicability thereof 
to other persons or circumstances shall not be affected thereby.



Sec. 1240.67  Patents, copyrights, inventions, product formulations, 
and publications.

    Except for a reasonable royalty paid by the Board to the inventor of 
a patented invention, any patents, copyrights, inventions, product 
formulations, or publications developed through the use of funds 
collected under the provisions of this subpart shall be the property of 
the Honey Board. Funds generated by such patents, copyrights, 
inventions, product formulations, or publications shall inure to the 
benefit of the Board and shall be considered income subject to the same 
fiscal, budget, and audit controls as other funds of the Board.

[56 FR 37457, Aug. 7, 1991]



                 Subpart B_General Rules and Regulations

    Source: 52 FR 3103, Feb. 2, 1987, unless otherwise noted.



Sec. 1240.100  Terms defined.

    Unless otherwise defined in this subpart, definitions of terms used 
in this subpart shall have the same meaning as the definitions of such 
terms which appear in Subpart--Honey Research, Promotion, and Consumer 
Information Order. Additional terms are defined in Sec. 1240.105.



Sec. 1240.105  Definitions.

    (a) Principal ingredient means fifty-one percent or more by weight 
of the

[[Page 239]]

total ingredients contained in honey products.
    (b) First handler means the person who first handles honey.
    (c) Order means the Honey Research, Promotion, and Consumer 
Information Order which appears in this part.
    (d) United States means the fifty States, the District of Columbia, 
and the Commonwealth of Puerto Rico.



Sec. 1240.106  Communications.

    Communications in connection with the Order and all rules, 
regulations, and supplemental Orders issued thereunder shall be 
addressed to the National Honey Board, 421 21st Street, Longmont, 
Colorado 80501-1421.

[56 FR 37458, Aug. 7, 1991]



Sec. 1240.107  Policy and objective.

    (a) It shall be the policy of the Board to carry out an effective 
and continous coordinated program of marketing research, development, 
advertising, and promotion in order to help maintain and expand existing 
domestic and foreign markets for honey and to develop new or improved 
markets.
    (b) It shall be the objective of the Board to carry out programs and 
projects which will provide maximum benefit to the honey industry and no 
undue preference shall be given to any of the various industry segments.



Sec. 1240.108  Contracts.

    The Board, with the approval of the Secretary, may enter into 
contracts or make agreements with persons for the development and 
submission to it of plans or projects authorized by the Order and for 
carrying out of such plans or projects. Contractors shall agree to 
comply with the provisions of this part. Subcontractors who enter into 
contracts or agreements with a primary contractor and who receive or 
otherwise utilize funds allocated by the Board shall be subject to the 
provisions of this part. All records of contractors and subcontractors 
applicable to contracts entered into by the Board are subject to audit 
by the Secretary.



Sec. 1240.109  Procedure.

    The Organization of the Board and the procedure for conducting 
meetings of the Board shall be in accordance with the By-Laws of the 
Board.



Sec. 1240.110  U.S. Department of Agriculture costs.

    The Board shall reimburse the U.S. Department of Agriculture (USDA) 
from assessments for administrative costs incurred by USDA with respect 
to the Order after its promulgation and for any administrative expenses 
incurred by USDA for the conduct of referenda. The Board shall pay those 
administrative costs incurred by USDA for the conduct of its duties 
under the Order as determined periodically by the Secretary. USDA will 
bill the Board quarterly and payment shall be due promptly after the 
billing of such costs.



Sec. 1240.111  First handler and producer-packer.

    Persons who are first handlers or producer-packers include but are 
not limited to the following:
    (a) When a producer delivers honey from his or her own production to 
a packer or processor for processing in preparation for marketing and 
consumption, the packer or processor is the first handler, regardless of 
whether he or she handles the honey for his or her own account or for 
the account of the producer or the account of other persons.
    (b) When a producer delivers honey to a handler who takes title to 
such honey, and places it in storage, such handler is the first handler.
    (c) When a producer delivers honey to a commercial storage facility 
for the purpose of holding such honey under his or her own account for 
later sale, the first handler of such honey would be identified on the 
basis of later handling of such honey.
    (d) When a producer packages and sells honey of his or her own 
production at a roadside stand or other facility to consumers or sells 
to wholesale or retail outlets or other buyers, the producer is a 
producer-packer.
    (e) When a producer sells unprocessed or processed honey from his or 
her own production directly to a commercial user or food processor who 
utilizes such

[[Page 240]]

honey as an ingredient in the manufacture of formulated products, the 
producer is a producer-packer.
    (f) When a producer uses honey from his or her own production in the 
manufacture of formulated products for his or her own account and for 
the account of others, the producer is the producer-packer.
    (g) When a producer delivers a lot of honey to a processor who 
processes and packages a portion of such lot of honey for his or her own 
account and sells the balance of the lot, with or without further 
processing, to another processor or commercial user, the first processor 
is the first handler for all the honey.
    (h) When a producer supplies honey to a cooperative marketing 
organization which sells or markets the honey, with or without further 
processing and packaging, the cooperative marketing organization becomes 
the first handler upon physical delivery to such cooperative.
    (i) When a producer uses honey from his or her own production for 
feeding his or her own bees, such honey is not handled at that time. 
Honey in any form sold and shipped to any persons for the purpose of 
feeding bees is handled and is subject to assessment. The buyer of the 
honey for feeding bees is the first handler.



Sec. 1240.113  Importer.

    Each lot of honey and honey products imported into the United States 
is subject to assessment under this part. Such assessment shall be paid 
by the importer of such honey and honey products at the time of entry or 
withdrawal for consumption into the United States. Any person who 
imports honey or honey products into the United States as principal, 
agent, broker, or consignee for honey produced outside the United States 
and imported into the United States shall be the importer.



Sec. 1240.114  Exemption procedures.

    (a) Producers who produce, producer-packers who produce and handle, 
and importers who import honey and who wish to claim an exemption from 
assessments pursuant to Sec. Sec. 1240.42 (a) and (b) should submit an 
application to the Board for a certificate of exemption.
    (b) Upon receipt of the claim for exemption, the Board shall 
investigate, to the extent practicable, the request for exemption. The 
Board will then issue, if deemed appropriate, an exemption certificate 
to each person who is eligible to receive one.
    (c) The Secretary, upon recommendation by the Board, may exempt that 
portion of assessments collected under a qualified State plan; Provided, 
That the State plan meets all of the requirements in Sec. 1240.42(d) of 
the Order.
    (1) First handlers collecting assessments from producers for the 
State plan and the Board shall forward that portion of assessments 
collected under the order in excess of the State assessment to the 
Board.
    (2) Upon request of the Board, producers having an exemption from a 
portion of the assessments under this Order due to payment of 
assessments under a State plan, shall be required to furnish evidence to 
the Board that the assessments to the State have been paid.

[52 FR 3103, Feb. 2, 1987, as amended at 56 FR 37458, Aug. 7, 1991; 59 
FR 22493, May 2, 1994]



Sec. 1240.115  Levy of assessments.

    (a) Time of payment. The assessment shall become due at the time 
assessable honey is first handled or entered or withdrawn for 
consumption into the United States pursuant to this part.
    (b) An assessment of one cent per pound is levied on honey produced 
in the United States, on imported honey entered or withdrawn for 
consumption into the United States, and on honey used in imported honey 
products entered or withdrawn for consumption into the United States 
except that assessments shall not be levied on the following:
    (1) Any persons other than importers holding a valid exemption 
certificate during the twelve month period ending on December 31;
    (2) That portion of honey which does not enter the current of 
commerce which is utilized solely to sustain a producers or producer-
packer's own colonies of bees;
    (3) That portion of otherwise assessable honey which is contained in 
imported products wherein honey is not a

[[Page 241]]

principal ingredient. Honey subject to assessment shall be assessed only 
once.
    (c) The assessment on each lot of honey handled in the United States 
shall be paid by the first handler who handles, or by the producer-
packer who produces and handles such honey.
    (1) The first handler shall collect and pay assessments to the Board 
unless such handler has received documentation acceptable to the Board 
that the assessment has been previously paid.
    (2) A producer-packer shall pay, or collect and pay, assessments to 
the Board unless--
    (i) Such producer-packer has obtained an exemption from the Board 
applicable to the honey which that producer-packer produced or produced 
and handled; or
    (ii) Has received documentation acceptable to the Board that the 
assessment has been previously paid.
    (d) Assessments shall be levied with respect to honey pledged as 
collateral for a loan or loan deficiency payment under the Commodity 
Credit Corporation (CCC) Honey Price Support Program in accordance with 
an agreement entered into between the Honey Board and the CCC. The 
assessment will be deducted from the proceeds of the loan or loan 
deficiency payment by the CCC and forwarded to the Board, except that 
the assessment shall not be deducted in the case of a honey marketing 
cooperative that has already deducted the assessment or that portion of 
the assessment paid to a qualified State plan exempted by the Board. The 
Secretary, through the CCC, shall provide for the producer to receive a 
statement of the amount of the assessment deducted from the loan funds 
or loan deficiency payment promptly after each occasion when an 
assessment is deducted from any such loan funds or payment under this 
subsection.
    (e) The U.S. Customs Service (USCS) will collect assessments on all 
honey or honey products where honey is the principal ingredient imported 
under its tariff schedule (HTS heading numbers 0409.00.00 and 
2106.90.9988) at the time of entry or withdrawal for consumption and 
forward such assessment as per the agreement between the USCS and USDA. 
Any importer or agent who is exempt from payment of assessments pursuant 
to Sec. 1240.42 (a) and (b) of the Order may apply to the Board for 
reimbursement of such assessment paid.
    (f) A late payment charge shall be imposed on any handler, producer-
packer, or importer except as otherwise authorized by the Board, who 
fails to pay to the Board within the time prescribed in this subpart the 
total amount of assessment due for which any such handler, importer, or 
producer-packer is liable. Fifteen days after the assessment becomes due 
a one-time late payment charge of 10 percent will be added to any 
outstanding funds due the Board.
    (g) In addition to the late payment charge, one and one-half percent 
per month interest on the outstanding balance except as otherwise 
authorized by the Board, will be added to any accounts delinquent over 
30 days and will continue monthly until the outstanding balance is paid 
to the Board.

[52 FR 3103, Feb. 2, 1987, as amended at 53 FR 37731, Sept. 28, 1988; 56 
FR 37458, Aug. 7, 1991; 61 FR 29462, June 11, 1996; 61 FR 38356, July 
24, 1996]



Sec. 1240.116  Payment of assessments.

    (a) Responsibility for payment. Unless otherwise authorized by the 
Board under the Act and Order, the first handler or producer-packer 
shall collect the assessment from the producer, or deduct such 
assessment from the proceeds paid to the producer on whose honey the 
assessment is made, and remit the assessments to the Board. The first 
handler or producer-packer shall furnish the producer with evidence of 
such payment. Any such collection or deduction of assessment shall be 
made not later than the time when the assessment becomes payable to the 
Board. Failure of the handler or producer-packer to collect or deduct 
such assessment does not relieve the handler or producer-packer of his 
or her obligation to remit the assessment to the Board. However, should 
a first handler or the Secretary fail to collect an assessment from a 
producer, the producer shall be responsible for the payment of the 
assessment to the Board. Assessments on imported honey and honey 
products shall be collected as specified in Sec. 1240.115(e); Provided, 
That importers shall be responsible for

[[Page 242]]

payment of any assessment amount not collected by the U.S. Customs 
Service at the time of entry or withdrawal for consumption into the 
United States.
    (b) Payment directly to the Board. Except as provided in paragraph 
(c) of this section, each first handler and producer-packer shall pay 
the required assessment pursuant to Sec. 1240.41 of the Order directly 
to the Board at the address referenced in Sec. 1240.106, for each 
reporting period specified in Sec. 1240.119, on or before the 15th day 
following the end of such period. Payment shall be in the form of a 
check, draft, or money order payable to the Board and shall be 
accompanied by a report on Board forms pursuant to Sec. 1240.50.
    (c) Prepayment of assessment. (1) In lieu of the monthly assessment 
payment specified in Sec. 1240.119 of this subpart, the Board may 
permit first handlers or producer-packers to make advance payments of 
their total estimated assessments for the season to the Board prior to 
their actual determination of assessable honey.
    (2) Persons using such procedure shall provide a monthly accounting 
of actual handling and assessments.
    (3) Specific requirements, instructions, and forms for making such 
advance payments shall be provided by the Board upon request.
    (d) Payment through cooperating agency. The Board may enter into 
agreements subject to approval of the Secretary authorizing other 
organizations to collect assessments in its behalf. All such agreements 
are subject to the requirements of the Act, Order, and all applicable 
rules and regulations under the Act and the Order.

[52 FR 3103, Feb. 2, 1987, as amended at 56 FR 37458, Aug. 7, 1991]



Sec. 1240.118  Reports of disposition of exempted honey.

    The Board may require reports by first handlers, producer-packers, 
importers, or any persons who receive an exemption from assessments 
under Sec. 1240.42 (a) and (b) on the handling and disposition of 
exempted honey. Also, authorized employees of the Board or the Secretary 
may inspect such books and records as are appropriate and necessary to 
verify the reports on such disposition.

[56 FR 37458, Aug. 7, 1991]



Sec. 1240.119  Reporting period and reports.

    (a) For the purpose of the payment of assessments, a calendar month 
shall be considered the reporting period; however, other accounting 
periods may be used when registered with and approved by the Board in 
writing.
    (b) Pursuant to Sec. 1240.50 of the Order, handlers and producer-
packers shall file with the Board a report for each reporting period.
    (1) All reports shall contain at least the following information:
    (i) The handler's or producer-packer's name and address;
    (ii) Date of report (which is also date of payment to the Board);
    (iii) Period covered by report; and
    (iv) Total quantity of honey determined as assessable during the 
reporting period.
    (2) Handlers or producer-packers who collect assessments from 
producers or withhold assessments for their accounts or pay the 
assessments themselves shall also include with each report a list of all 
such producers whose honey was handled during the period, their 
addresses, and to total assessable quantities handled for each such 
producer.
    (c) Each importer shall file with the Board a monthly report 
containing at least the following information:
    (1) The importer's name and address.
    (2) The quantity of honey and honey products entered or withdrawn 
for consumption into the United States.
    (3) The amount of assessment paid on honey and honey products 
entered or withdrawn for consumption into the United States to the U.S. 
Customs Service at the time of entry or withdrawal for consumption.
    (4) The amount of any honey and honey products on which the 
assessment was not paid to the U.S. Customs Service at the time of entry 
or withdrawal for consumption into the United States.
    (d) In the event of a first handler's, producer-packer's, or 
importer's death, bankruptcy, receivership, or incapacity

[[Page 243]]

to act, the representative of the handler, producer-packer, or importer 
or his or her estate, shall be considered the first handler, producer-
packer, or importer for the purposes of this part.



Sec. 1240.120  Retention period for records.

    Each first handler, producer-packer, importer, or any person who 
receives an exemption from assessments under Sec. Sec. 1240.42 (a) and 
(b) required to make reports pursuant to this subpart shall maintain and 
retain for at least two years beyond the marketing year of their 
applicability: One copy of each report made to the Board, records of all 
exempt producers, producer-packers, and importers including 
certification of exemption as necessary to verify the address of such 
exempt person and such records as are necessary to verify such reports.

[56 FR 37458, Aug. 7, 1991]



Sec. 1240.121  Availability of records.

    Each first handler, producer-packer, importer, or any person who 
receives an exemption from assessments under Sec. Sec. 1240.42 (a) and 
(b) and is required to make reports pursuant to this subpart shall make 
available for inspection by authorized employees of the Board or the 
Secretary during regular business hours, such records as are appropriate 
and necessary to verify reports required under this subpart.

[56 FR 37458, Aug. 7, 1991]



Sec. 1240.122  Confidential books, records, and reports.

    All information obtained from the books, records, and reports of 
handlers, producer-packers, importers or any persons who receive an 
exemption from assessments under Sec. 1240.42 (a) and (b) and all 
information with respect to refunds of assessments made to individual 
producers and importers shall be kept confidential in the manner and to 
the extent provided for in Sec. 1240.52 of the Order.

[56 FR 37458, Aug. 7, 1991]



Sec. 1240.123  Right of the Secretary.

    All fiscal matters, programs, projects, rules or regulations, 
reports, or other substantive action proposed and prepared by the Board 
shall be submitted to the Secretary for approval.



Sec. 1240.124  Personal liability.

    No member of the Board shall be held personally responsible, either 
individually or jointly with others, in any way whatsoever to any person 
for errors in judgment, mistakes, or other acts, either of commission or 
omission, as such member, alternate member, or employee except for acts 
of willful misconduct, gross negligence, or those which are criminal in 
nature.



Sec. 1240.125  OMB control numbers.

    The control numbers assigned to the information collection 
requirements by the Office of Management and Budget pursuant to the 
Paperwork Reduction Act of 1980, Public Law 96-511, are as follows: OMB 
Number 0581-0093, except Board member nominee information sheets which 
are assigned OMB Number 0505-0001.

[56 FR 37458, Aug. 7, 1991]



                     Subpart C_Referendum Procedures

    Source: 65 FR 48321, Aug. 7, 2000, unless othewise noted.



Sec. 1240.200  General.

    Referenda to determine whether eligible producers, importers, and, 
in the case of an order assessing handlers, handlers favor the 
continuation, suspension, termination, or amendment of the Honey 
Research, Promotion, and Consumer Information Order shall be conducted 
in accordance with this subpart.



Sec. 1240.201  Definitions.

    (a) Act means the Honey Research, Promotion, and Consumer 
Information Act (Pub. L. 98-590; 98 Stat. 3115; enacted October 30, 
1984; 7 U.S.C. 4601-4613, as amended) and any amendments thereto.
    (b) Administrator means the Administrator of the Agricultural 
Marketing Service, with power to redelegate, or any officer or employee 
of the Department to whom authority has been delegated or may hereafter 
be delegated to act in the Administrator's stead.

[[Page 244]]

    (c) Board or National Honey Board means the Honey Board, the 
administrative body provided for under section 7(c) of the Act and 
established under Sec. 1240.30.
    (d) Department means the United States Department of Agriculture.
    (e) Eligible handler means any person defined as a handler or 
producer-packer in the Order, or importer in this subpart, who handles 
domestic honey or honey products, and is covered by an order and subject 
to assessment on domestic honey handled during the representative 
period.
    (f) Eligible importer means any person defined as an importer in 
this subpart, who is engaged in the importation of honey or honey 
products, and is subject to pay assessments to the Board on honey or 
honey products imported during the representative period.
    (g) Eligible producer means any person defined as a producer or 
producer-packer in the Order who produces honey and is subject to pay 
assessments to the Board on such honey produced during the 
representative period and who:
    (1) Owns or shares in the ownership of honey bee colonies or 
beekeeping equipment resulting in the ownership of the honey produced;
    (2) Rents honey bee colonies or beekeeping equipment resulting in 
the ownership of all or a portion of the honey produced;
    (3) Owns honey bee colonies or beekeeping equipment but does not 
manage them and, as compensation, obtains the ownership of a portion of 
the honey produced; or
    (4) Is a party in a lessor-lessee relationship or a divided 
ownership arrangement involving totally independent entities cooperating 
only to produce honey who share the risk of loss and receive a share of 
the honey produced. No other acquisition of legal title to honey shall 
be deemed to result in persons becoming eligible producers.
    (h) Importer means any person who imports honey or honey products 
into the United States as principal or as an agent, broker, or consignee 
for any person who produces honey or honey products outside of the 
United States for sale in the United States, and who is listed as the 
importer of record for such honey or honey products.
    (i) Order means the Honey Research, Promotion, and Consumer 
Information Order.
    (j) Person means any individual, group of individuals, partnership, 
corporation, association, cooperative, or any other entity. For the 
purpose of this definition, the term partnership includes, but is not 
limited to:
    (1) A husband and wife who have title to, or leasehold interest in, 
honey bee colonies or beekeeping equipment as tenants in common, joint 
tenants, tenants by the entirety, or, under community property laws, as 
community property, and
    (2) So-called joint ventures wherein one or more parties to the 
agreement, informal or otherwise, contributed land and others 
contributed capital, labor, management, equipment, or other services, or 
any variation of such contributions by two or more parties, so that it 
results in the production, handling, or importation of honey or honey 
products for market and the authority to transfer title to the honey or 
honey products so produced, handled or imported.
    (k) Referendum agent or agent means the individual or individuals 
designated by the Secretary to conduct the referendum.
    (l) Representative period means the period designated by the 
Secretary pursuant to the Act.
    (m) Secretary means the Secretary of Agriculture of the United 
States, or any officer or employee of the Department to whom authority 
has heretofore been delegated, or to whom authority may hereafter be 
delegated, to act in the Secretary's stead.



Sec. 1240.202  Voting.

    (a) Eligibility. (1) Each person who is, as defined in this subpart, 
an eligible producer; an eligible importer; or, in the case of an order 
assessing handlers, an eligible handler shall be entitled to vote in the 
referendum.
    (2) In conducting a referendum for the sole purpose of determining 
whether persons favor the implementation of amendments to the Order in 
accordance with changes to the Act made by the Agricultural Research, 
Extension, and Education Reform Act of 1998 (Pub.

[[Page 245]]

L. 105-185, enacted June 23, 1998), producer-packers, importers, and 
handlers shall be allowed to vote as if:
    (i) The proposed amendments to the Order were in place during the 
representative period; and
    (ii) They were subject to assessment based on the quantity of honey 
or honey products handled during the representative period.
    (b) Number of ballots cast. (1) Each person who is an eligible 
producer, as defined in this subpart, at the time of the referendum and 
during the representative period, shall be entitled to cast one ballot 
in the referendum: Provided, That each producer in a landlord-tenant 
relationship or a divided ownership arrangement involving totally 
independent entities cooperating only to produce honey and/or honey 
products, in which more than one of the parties is a producer, shall be 
entitled to cast one ballot covering only such producer's share of the 
ownership.
    (2) In the case of an order assessing handlers, each person who is 
an eligible handler, as defined in this subpart, at the time of the 
referendum and during the representative period, shall be entitled to 
cast one ballot in the referendum.
    (3) Each person who is a producer-packer, as defined in the Order, 
at the time of the referendum and during the representative period, 
shall be entitled to cast one ballot as an eligible producer and, in the 
case of an order assessing handlers, one ballot as an eligible handler.
    (4) Each importer, as defined in the Order, at the time of the 
referendum and during the representative period, shall be entitled to 
cast in the referendum one ballot as an importer and, in the case of an 
order assessing handlers, one ballot as an eligible handler.
    (c) Proxy voting. Proxy voting is not authorized, but an officer or 
employee of an eligible corporate producer; importer; and, in the case 
of an order assessing handlers, handler; or an administrator, executor, 
or trustee of an eligible entity may cast a ballot on behalf of such 
entity. Any individual so voting in a referendum shall certify that they 
are an officer or employee of the eligible entity, or an administrator, 
executor, or trustee of an eligible entity and that such individual has 
the authority to take such action. Upon request of the referendum agent, 
the individual shall submit adequate evidence of such authority.
    (d) Casting of ballots. All ballots are to be cast by mail as 
instructed by the Secretary.



Sec. 1240.203  Instructions.

    The referendum agent shall conduct the referendum, in the manner 
herein provided, under the supervision of the Administrator. The 
Administrator may prescribe additional instructions, not inconsistent 
with the provisions hereof, to govern the procedure to be followed by 
the referendum agent. Such agent shall:
    (a) Determine the period during which ballots may be cast.
    (b) Provide ballots and related material to be used in the 
referendum. The ballot shall provide for recording essential 
information, including that needed for ascertaining:
    (1) Whether the person voting, or on whose behalf the vote is cast, 
is an eligible voter; and
    (2) The quantity of honey or honey products produced, imported, and, 
in the case of an order assessing handlers, handled.
    (c) Give reasonable public notice of the referendum:
    (1) By utilizing available media or public information sources, 
without incurring advertising expense, to publicize the voting period, 
method of voting, eligibility requirements, and other pertinent 
information. Such sources of publicity may include, but are not limited 
to, print and radio; and
    (2) By such other means as said agent may deem advisable.
    (d) Mail to eligible producers, importers, and in the case of an 
order assessing handlers, handlers whose names and addresses are known 
to the referendum agent the instructions on voting; a ballot; and a 
summary of the terms and conditions to be voted upon. No person who 
claims to be eligible to vote shall be refused a ballot.
    (e) At the end of the voting period, collect, open, number, and 
review the ballots and tabulate the results in the presence of an agent 
of a third party

[[Page 246]]

authorized to monitor the referendum process.
    (f) Prepare a report on the referendum.
    (g) Announce the results to the public.



Sec. 1240.204  Subagents.

    The referendum agent may appoint any individual or individuals 
necessary to assist the agent in performing such agent's functions 
hereunder. Each individual so appointed may be authorized by the agent 
to perform any or all of the functions which, in the absence of such 
appointment, shall be performed by the agent.



Sec. 1240.205  Ballots.

    The referendum agent and subagents shall accept all ballots cast. 
However, if an agent or subagent deems that a ballot should be 
questioned for any reason, the agent or subagent shall endorse above 
their signature, on the ballot, a statement to the effect that such 
ballot was questioned, by whom questioned, why the ballot was 
questioned, the results of any investigation made with respect to the 
questionable ballot, and the disposition of the questionable ballot. 
Ballots invalid under this subpart shall not be counted.



Sec. 1240.206  Referendum report.

    Except as otherwise directed, the referendum agent shall prepare and 
submit to the Administrator a report on the results of the referendum, 
the manner in which it was conducted, the extent and kind of public 
notice given, the number of ballots cast, the number of valid ballots, 
and other information pertinent to analysis of the referendum and its 
results.



Sec. 1240.207  Confidential information.

    All ballots cast and their contents and all other information or 
reports furnished to, compiled by, or in possession of, the referendum 
agent or subagents that reveal, or tend to reveal, the identity or vote 
of any producer, handler, or importer of honey or honey products shall 
be held strictly confidential and shall not be disclosed.



PART 1250_EGG RESEARCH AND PROMOTION--Table of Contents




                Subpart_Egg Research and Promotion Order

                               Definitions

Sec.
1250.301 Secretary.
1250.302 Act.
1250.303 Fiscal period.
1250.304 Egg Board or Board.
1250.305 Egg producer or producer.
1250.306 Commercial eggs or eggs.
1250.307 Person.
1250.308 United States.
1250.309 Handler.
1250.310 Promotion.
1250.311 Research.
1250.312 Marketing.
1250.313 Eligible organization.
1250.314 Plans and projects.
1250.315 Part and subpart.
1250.316 Representative of a producer.

                                Egg Board

1250.326 Establishment and membership.
1250.327 Term of office.
1250.328 Nominations.
1250.329 Selection.
1250.330 Acceptance.
1250.331 Vacancies.
1250.332 Alternate members.
1250.333 Procedure.
1250.334 Compensation and reimbursement.
1250.335 Powers of the Board.
1250.336 Duties.

                   Research, Education, and Promotion

1250.341 Research, education, and promotion.

                        Expenses and Assessments

1250.346 Expenses.
1250.347 Assessments.
1250.348 Exemptions.
1250.349 Collecting handlers and collection.
1250.350 [Reserved]
1250.351 Influencing governmental action.

                       Reports, Books, and Records

1250.352 Reports.
1250.353 Books and records.
1250.354 Confidential treatment.

                     Certification of Organizations

1250.356 Certification of organizations.

                              Miscellaneous

1250.357 Suspension and termination.
1250.358 Proceedings after termination.
1250.359 Effect of termination or amendment.
1250.360 [Reserved]

[[Page 247]]

1250.361 Right of the Secretary.
1250.362 Amendments.
1250.363 Separability.

                      Subpart_Rules and Regulations

                               Definitions

1250.500 Terms defined.

  OMB Control Numbers Assigned Pursuant to the Paperwork Reduction Act

1250.501 OMB control numbers assigned pursuant to the Paperwork 
          Reduction Act.

                                 General

1250.505 Communications.
1250.506 Policy and objective.
1250.507 Contracts.
1250.508 Procedure.
1250.509 USDA costs.
1250.510 Determination of Board membership.

                Assessments, Collections, and Remittances

1250.514 Levy of assessments.
1250.515 Reporting period and payment.
1250.516 Collecting handlers and collection.
1250.517 Remittance to Egg Board.
1250.518 Receipts for payment of assessments.
1250.519 Late-payment charge.

                Registration, Certification, and Reports

1250.528 Registration of collecting handlers.
1250.529 Reports.
1250.530 Certification of exempt producers.

                                 Records

1250.535 Retention of records.
1250.536 Availability of records.
1250.537 Confidentiality.

            Patents, Copyrights, Trademarks, and Information

1250.542 Patents, copyrights, trademarks, and information.

                           Personal Liability

1250.547 Personal liability.

    Authority: 7 U.S.C. 2701-2718.



                Subpart_Egg Research and Promotion Order

    Source: 40 FR 59190, Dec. 22, 1975, unless otherwise noted.

                               Definitions



Sec. 1250.301  Secretary.

    Secretary means the Secretary of Agriculture or any other officer or 
employee of the Department of Agriculture to whom there has heretofore 
been delegated, or to whom there may hereafter be delegated, the 
authority to act in his stead.



Sec. 1250.302  Act.

    Act means the Egg Research and Consumer Information Act and as it 
may be amended (Pub. L. 93-428).



Sec. 1250.303  Fiscal period.

    Fiscal period means the calendar year unless the Egg Board, with the 
approval of the Secretary, selects some other budgetary period.



Sec. 1250.304  Egg Board or Board.

    Egg Board or Board or other designatory term adopted by such Board, 
with the approval of the Secretary, means the administrative body 
established pursuant to Sec. 1250.326.



Sec. 1250.305  Egg producer or producer.

    Egg producer or producer means any person who either:
    (a) Is an egg farmer who acquires and owns laying hens, chicks, and/
or started pullets for the purpose of and is engaged in the production 
of commercial eggs; or
    (b) Is a person who supplied or supplies laying hens, chicks, and/or 
started pullets to an egg farmer for the purpose of producing commercial 
eggs pursuant to an oral or written contractual argeement for the 
production of commercial eggs. Such person is deemed to be the owner of 
such laying hens unless it is established in writing, to the 
satisfaction of the Secretary or the Egg Board, that actual ownership of 
the laying hens is in some other party to the contract. In the event the 
party to an oral contract who supplied or supplies the laying hens 
cannot be readily identified by the Secretary or the Egg Board, the 
person who has immediate possession and control over the laying hens at 
the egg production facility shall be deemed to be the owner of such hens 
unless written notice is provided to the Secretary or the Egg Board, 
signed by the parties to said oral contract, clearly stating that the 
eggs are being produced under a contractual agreement and identifying 
the party

[[Page 248]]

(or parties) under said contract who is the owner of the hens.



Sec. 1250.306  Commercial eggs or eggs.

    Commercial eggs or eggs means eggs from domesticated chickens which 
are sold for human consumption either in shell egg form or for further 
processing into egg products.



Sec. 1250.307  Person.

    Person means any individual, group of individuals, partnership, 
corporation, association, cooperative, or any other entity.



Sec. 1250.308  United States.

    United States means the 48 contiguous States of the United States of 
America and the District of Columbia.



Sec. 1250.309  Handler.

    Handler means any person who receives or otherwise acquires eggs 
from an egg producer, and processes, prepares for marketing, or markets, 
such eggs, including eggs of his own production.



Sec. 1250.310  Promotion.

    Promotion means any action, including paid advertising, to advance 
the image or desirability of eggs, egg products, spent fowl, or products 
of spent fowl.



Sec. 1250.311  Research.

    Research means any type of research to advance the image, 
desirability, marketability, production, or quality of eggs, egg 
products, spent fowl, or products of spent fowl, or the evaluation of 
such research.



Sec. 1250.312  Marketing.

    Marketing means the sale or other disposition of commercial eggs, 
egg products, spent fowl, or products of spent fowl in any channel of 
commerce.



Sec. 1250.313  Eligible organization.

    Eligible organization means any organization, association, or 
cooperative which represents egg producers of any egg producing area of 
the United States certified by the Secretary pursuant to Sec. 1250.356.



Sec. 1250.314  Plans and projects.

    Plans and projects means those research, consumer and producer 
education, advertising, marketing, product development, and promotion 
plans, studies, or projects pursuant to Sec. 1250.341.



Sec. 1250.315  Part and subpart.

    Part means the Egg Research and Promotion Order and all rules, 
regulations, and supplemental order issued pursuant to the act and the 
order. ``Subpart'' refers to the aforesaid order or any other portion or 
segment of this part.



Sec. 1250.316  Representative of a producer.

    Representative of a producer means the owner, officer, or an 
employee of a producer who has been duly authorized to act in the place 
and stead of the producer.

                                Egg Board



Sec. 1250.326  Establishment and membership.

    There is hereby established an Egg Board, hereinafter called the 
``Board,'' composed of 18 egg producers or representatives of egg 
producers, and 18 specific alternates, all appointed by the Secretary 
from nominations submitted by eligible organizations, associations, or 
cooperatives, or by other producers pursuant to Sec. 1250.328.



Sec. 1250.327  Term of office.

    The members of the Board, and their alternates, shall serve for 
terms of 2 years, except initial appointments shall be, proportionately, 
for terms of 2 and 3 years. Each member and alternate member shall 
continue to serve until his successor is appointed by the Secretary and 
has qualified. No member shall serve for more than three consecutive 
terms.



Sec. 1250.328  Nominations.

    All nominations authorized under Sec. 1250.326 shall be made in the 
following manner:
    (a) Within 30 days of the approval of this order by referendum, 
nominations shall be submitted to the Secretary for each geographic area 
as specified in

[[Page 249]]

paragraph (d) of this section by eligible organizations, associations, 
or cooperatives certified pursuant to Sec. 1250.356, or, if the 
Secretary determines that a substantial number of egg producers are not 
members of, or their interests are not represented by, any such eligible 
organization, association, or cooperative, then from nominations made by 
such egg producers in the manner authorized by the Secretary;
    (b) After the establishment of the initial Board, the nominations 
for subsequent Board members and alternates shall be submitted to the 
Secretary not less than 60 days prior to the expiration of the terms of 
the members and alternates previously appointed to the Board;
    (c) Where there is more than one eligible organization, association, 
or cooperative within each geographic area, as defined by the Secretary, 
they may caucus for the purpose of jointly nominating two qualified 
persons for each member and for each alternate member to be appointed. 
If joint agreement is not reached with respect to any such nominations, 
or if no caucus is held within a defined geographic area, each eligible 
organization, association, or cooperative may submit to the Secretary 
two nominations for each appointment to be made;
    (d) The number of members of the initial Board, and their 
alternates, who shall be appointed from each area are: Area 1-3, Area 2-
4, Area 3-2, Area 4-2, Area 5-4, and Area 6-3, for a total of 18 members 
from all areas. Changes to the Board as provided in paragraph (e) of 
this section shall be accomplished by determining the percentage of 
United States egg production in each area times 18 (total Board 
membership) and rounding to the nearest whole number; and
    (e) After the establishment of the initial Board, the area grouping 
of the 48 contiguous States of the United States, including the area 
distribution of the 18 members of the Board and their alternates, shall 
be reviewed at any time not to exceed 5 years by the Board, or by a 
person or agency designated by the Board to perform such review, and the 
results shall be reported to the Secretary along with any 
recommendations by the Board regarding whether the delineation of the 
areas and the area distribution of the Board should continue without any 
change, or whether changes should be made in either the areas or the 
number of Board members to be appointed from each area, providing that 
each area shall be represented by not less than one Board member and any 
action recommended shall be subject to the approval of the Secretary.

[40 FR 59190, Dec. 22, 1975, as amended at 60 FR 66861, Dec. 27, 1995]



Sec. 1250.329  Selection.

    From the nominations made pursuant to Sec. 1250.328, the Secretary 
shall appoint the members of the Board, and an alternate for each such 
member, on the basis of representations provided for in Sec. 1250.326, 
Sec. 1250.327, and Sec. 1250.328.



Sec. 1250.330  Acceptance.

    Any person appointed by the Secretary as a member, or as an 
alternate member, of the Board shall qualify by filing a written 
acceptance with the Secretary within a period of time prescribed by the 
Secretary.



Sec. 1250.331  Vacancies.

    To fill any vacancy occasioned by the failure to qualify of any 
person appointed as a member, or as an alternate member, of the Board, 
or in the event of the death, removal, resignation, or disqualification 
of any member or alternate member of the Board, a successor for the 
unexpired term of such member or alternate member of the Board shall be 
nominated, qualified, and appointed in the manner specified in Sec. 
1250.326, Sec. 1250.328(b), Sec. 1250.329, and Sec. 1250.330, except 
that replacement of a Board member, or alternate, with an unexpired term 
of less than 6 months is not necessary.



Sec. 1250.332  Alternate members.

    An alternate member of the Board, during the absence of the member 
for whom he is the alternate, shall act in the place and stead of such 
member and perform such other duties as assigned. In the event of the 
death, removal, resignation, or disqualification of a member, his 
alternate shall act for

[[Page 250]]

him until a successor for such member is appointed and qualified.



Sec. 1250.333  Procedure.

    (a) A majority of the members, including alternates acting for 
members of the Board, shall constitute a quorum, and any action of the 
Board shall require the concurring votes of at least a majority of those 
present and voting. At assembled meetings, all votes shall be cast in 
person.
    (b) For routine and noncontroversial matters which do not require 
deliberation and exchange of views, and in matters of an emergency 
nature when there is not enough time to call an assembled meeting of the 
Board, the Board may also take action upon the concurring votes of a 
majority of its members by mail, telephone, or telegraph, but any such 
action by telephone shall be confirmed promptly in writing.



Sec. 1250.334  Compensation and reimbursement.

    The members of the Board, and alternates when acting as members, 
shall serve without compensation but shall be reimbursed for necessary 
and reasonable expenses, as approved by the Board, incurred by them in 
the performance of their duties under this subpart.



Sec. 1250.335  Powers of the Board.

    The Board shall have the following powers:
    (a) To administer the provisions of this subpart in accordance with 
its terms and provisions;
    (b) To make rules and regulations to effectuate the terms and 
provisions of this subpart;
    (c) To receive, investigate, and report to the Secretary complaints 
of violations of this subpart; and
    (d) To recommend to the Secretary amendments to this subpart.



Sec. 1250.336  Duties.

    The Board shall have the following duties:
    (a) To meet and organize and to select from among its members a 
chairman and such other officers as may be necessary, to select 
committees and subcommittees of Board members, to adopt such rules for 
the conduct of its business as it may deem advisable, and it may 
establish advisory committees of persons other than Board members;
    (b) To appoint or employ such persons as it may deem necessary and 
to define the duties and determine the compensation of each;
    (c) To prepare and submit to the Secretary for his approval budgets 
on a fiscal-period basis of its anticipated expenses and disbursements 
in the administration of this subpart, including probable cost of plans 
and projects as estimated in the budget or budgets submitted to it by 
prospective contractors, with the Board's recommendations with respect 
thereto. In preparing a budget for each of the 1994 and subsequent 
fiscal years, the Board shall, to the maximum extent practicable, 
allocate a proportion of funds for research projects comparable to the 
proportion of funds allocated for research projects in the Board's 
fiscal year 1993 budget.
    (d) With the approval of the Secretary, to enter into contracts or 
agreements with persons, including, but not limited to, State, regional, 
or national agencies or State, regional, or national egg organizations 
which administer research, education, or promotion programs, advertising 
agencies, public relations firms, public or private research 
organizations, advertising and promotion media, and egg producer 
organizations, for the development and submission to it of plans and 
projects authorized by Sec. 1250.341 and for the carrying out of such 
plans or projects when approved by the Secretary, and for the payment of 
the cost thereof with funds collected pursuant to Sec. 1250.347. Any 
such contracts or agreements shall provide that such contractors shall 
develop and submit to the Board a plan or project together with a budget 
or budgets which shall show estimated costs to be incurred for such plan 
or project, and that any such plan or project shall become effective 
upon approval by the Secretary. Any such contract or agreement shall 
also provide that the contractor shall keep accurate records of all of 
its transactions and make periodic reports to the Board

[[Page 251]]

of activities carried out and an accounting for funds received and 
expended, and such other reports as the Secretary may require;
    (e) To review and submit to the Secretary any plans or projects 
which have been developed and submitted to it by the prospective 
contractor, together with its recommendations with respect to the 
approval thereof by the Secretary;
    (f) To maintain such books and records and prepare and submit such 
reports from time to time to the Secretary as he may prescribe, and to 
make appropriate accounting with respect to the receipt and disbursement 
of all funds entrusted to it;
    (g)-(h) [Reserved]
    (i) To prepare and make public, at least annually, a report of 
activities carried out and an accounting for funds received and 
expended;
    (j) To cause its books to be audited by a certified public 
accountant at least once each fiscal period and at such other times as 
the Secretary may request, and submit a copy of each such audit to the 
Secretary;
    (k) To give the Secretary the same notice of meetings of the Board 
as is given to members in order that he or his representative may attend 
such meetings;
    (l) To act as an intermediary between the Secretary and any producer 
or handler; and
    (m) To submit to the Secretary such information pursuant to this 
subpart as he may request.

[40 FR 59190, Dec. 22, 1975, as amended at 54 FR 99, Jan. 4, 1989, and 
54 FR 11493, Mar. 21, 1989; 54 FR 12310, Mar. 24, 1989; 59 FR 38876, 
Aug. 1, 1994; 60 FR 66861, Dec. 27, 1995]

                   Research, Education, and Promotion



Sec. 1250.341  Research, education, and promotion.

    The Board shall develop and submit to the Secretary for approval any 
programs or projects authorized in this section. Such programs or 
projects shall provide for:
    (a) The establishment, issuance, effectuation, and administration of 
appropriate programs or projects for advertising, sales promotion, and 
consumer education with respect to the use of eggs, egg products, spent 
fowl, and products of spent fowl: Provided, however, That any such 
program or project shall be directed towards increasing the general 
demand for eggs, egg products, spent fowl, or products of spent fowl;
    (b) The establishment and carrying on of research, marketing, and 
development projects and studies with respect to sale, distribution, 
marketing, utilization, or production of eggs, egg products, spent fowl, 
and products of spent fowl, and the creation of new products thereof in 
accordance with section 7(b) of the act, to the end that the marketing 
and utilization of eggs, egg products, spent fowl, and products of spent 
fowl may be encouraged, expanded, improved, or made more acceptable, and 
the data collected by such activities may be disseminated;
    (c) The development and expansion of foreign markets and uses for 
eggs, egg products, spent fowl, and products of spent fowl;
    (d) Each program or project authorized under paragraphs (a), (b), 
and (c) of this section shall be periodically reviewed or evaluated by 
the Board to insure that each such program or proj ect contributes to a 
coordinated national program of research, education, and promotion 
contributing to the maintenance of markets and for the development of 
new markets for and of new products from eggs, egg products, spent fowl, 
and products of spent fowl. If it is found by the Board that any such 
program or project does not further the national purpose of the act, 
then the Board shall terminate such program or project; and
    (e) No advertising or promotion programs shall use false or 
unwarranted claims or make any reference to private brand names of eggs, 
egg products, spent fowl, and products of spent fowl or use unfair or 
deceptive acts or practices with respect to quality, value, or use of 
any competing product.

                        Expenses and Assessments



Sec. 1250.346  Expenses.

    The Board is authorized to incur such expenses as the Secretary 
finds are reasonable and likely to be incurred by the Board for its 
maintenance and

[[Page 252]]

functioning and to enable it to exercise its powers and perform its 
duties in accordance with the provisions of this subpart. The total 
costs incurred by the Board for a fiscal period in collecting producer 
assessments and having an administrative staff shall not exceed an 
amount of the projected total assessments to be collected by the Board 
for such fiscal period that the Secretary determines to be reasonable. 
The funds to cover such expenses shall be paid from assessments received 
pursuant to Sec. 1250.347.

[40 FR 59190, Dec. 22, 1975, as amended at 54 FR 100, Jan. 4, 1989, and 
54 FR 11493, Mar. 21, 1989]



Sec. 1250.347  Assessments.

    Each handler designated in Sec. 1250.349 and pursuant to 
regulations issued by the Board shall collect from each producer, except 
for those producers specifically exempted in Sec. 1250.348, and shall 
pay to the Board at such times and in such manner as prescribed by 
regulations issued by the Board an assessment at a rate not to exceed 10 
cents per 30-dozen case of eggs, or the equivalent thereof, for such 
expenses and expenditures, including provisions for a reasonable reserve 
and those administrative costs incurred by the Department of Agriculture 
after this subpart is effective, as the Secretary finds are reasonable 
and likely to be incurred by the Board and the Secretary under this 
subpart, except that no more than one such assessment shall be made on 
any case of eggs.

[59 FR 64560, Dec. 15, 1994]



Sec. 1250.348  Exemptions.

    The following shall be exempt from the specific provisions of the 
Act:
    (a) Any egg producer whose aggregate number of laying hens at any 
time during a 3-consecutive-month period immediately prior to the date 
assessments are due and payable has not exceeded 75,000 laying hens. The 
aggregate number of laying hens owned by a trust or similar entity shall 
be considered ownership by the beneficiaries of the trust or other 
entity. Ownership of laying hens by an egg producer also shall include 
the following:
    (1) In cases in which the producer is an individual, laying hens 
owned by such producer or members of such producer's family that are 
effectively under the control of such producer, as determined by the 
Secretary;
    (2) In cases in which the producer is a general partnership or 
similar entity, laying hens owned by the entity and all partners or 
equity participants in the entity; and
    (3) In cases in which the producer holds 50 percent or more of the 
stock or other beneficial interest in a corporation, joint stock 
company, association, cooperative, limited partnership, or other similar 
entity, laying hens owned by the entity. Stock or other beneficial 
interest in an entity that is held by the following shall be considered 
as held by the producer:
    (i) Members of the producer's family described in paragraph (a)(1);
    (ii) A general partnership or similar entity in which the producer 
is a partner or equity participant;
    (iii) The partners or equity participants in an entity of the type 
described in (a)(3)(ii); or
    (iv) A corporation, joint stock company, association, cooperative, 
limited partnership, or other similar entity in which the producer holds 
50 percent or more of the stock or other beneficial interests.
    (b) Any egg producer owning a flock of breeding hens whose 
production of eggs is primarily utilized for the hatching of baby 
chicks.
    (c) In order to qualify for exemption from the provisions of the Act 
under this section, producers claiming such exemption must comply with 
Sec. 1250.530 regarding certification of exempt producers and other 
such regulations as may be prescribed by the Secretary as a condition to 
exemption from the provisions of the Act under this section.

[55 FR 6973, Feb. 28, 1990, as amended at 59 FR 38876, Aug. 1, 1994]



Sec. 1250.349  Collecting handlers and collection.

    (a) Handlers responsible for collecting the assessment specified in 
Sec. 1250.347 shall be any one of the following:

[[Page 253]]

    (1) The first person to whom eggs are sold, consigned, or delivered 
by producers and who grades, cartons, breaks, or otherwise performs a 
function of a handler under Sec. 1250.309,
    (2) A producer who grades, cartons, breaks, or otherwise performs a 
function of a handler under Sec. 1250.309 for eggs of his own 
production, or
    (3) Such other persons as designated by the Board under rules and 
regulations issued pursuant to this subpart.
    (b) Handlers shall collect and remit to the Egg Board all 
assessments collected in the manner and in the time specified by the 
Board pursuant to rules and regulations issued by the Board.
    (c) Handlers shall maintain such rec ords as the Egg Board may 
prescribe pursuant to rules and regulations issued by the Board.
    (d) The Board with the approval of the Secretary may authorize other 
organizations or agencies to collect assessments in its behalf.

[40 FR 59190, Dec. 22, 1975. Redesignated at 55 FR 6973, Feb. 28, 1990]



Sec. 1250.350  [Reserved]



Sec. 1250.351  Influencing governmental action.

    No funds collected by the Board under this subpart shall in any 
manner be used for the purpose of influencing governmental policy or 
action except to recommend to the Secretary amendments to this subpart.

[40 FR 59190, Dec. 22, 1975. Redesignated at 55 FR 6973, Feb. 28, 1990]

                       Reports, Books, and Records



Sec. 1250.352  Reports.

    Each handler subject to this subpart and other persons subject to 
section 7(c) of the act may be required to report to the Board 
periodically such information as is required by regulations and will 
effectuate the purposes of the act, which information may include but 
not be limited to the following:
    (a) Number of cases of eggs handled;
    (b) Number of cases of eggs on which an assessment was collected;
    (c) Name and address of person from whom any assessment was 
collected; and
    (d) Date collection of assessment was made on each case of eggs 
handled.

[40 FR 59190, Dec. 22, 1975. Redesignated at 55 FR 6973, Feb. 28, 1990]



Sec. 1250.353  Books and records.

    Each handler subject to this subpart and persons subject to section 
7(c) of the act shall maintain and make available for inspection by the 
Board or the Secretary such books and records as are necessary to carry 
out the provisions of the subpart and the regulations issued hereunder, 
including such records as are necessary to verify any reports required. 
Such records shall be retained for at least 2 years beyond the fiscal 
period of their applicability.

[40 FR 59190, Dec. 22, 1975. Redesignated at 55 FR 6973, Feb. 28, 1990]



Sec. 1250.354  Confidential treatment.

    (a) All information obtained from such books, records, or reports 
shall be kept confidential by all officers and employees of the 
Department of Agriculture and the Board, and only such information so 
furnished or acquired as the Secretary deems relevant shall be disclosed 
by them, and then only in a suit or administrative hearing brought at 
the direction, or upon the request of the Secretary, or to which the 
Secretary or any officer of the United States is a party and involving 
this subpart. Nothing in this paragraph shall be deemed to prohibit (1) 
the issuance of general statements based upon the reports of the number 
of persons subject to this subpart or statistical data collected 
therefrom, which statements do not identify the information furnished by 
any person, (2) the publication, by direction of the Secretary, of 
general statements relating to refunds made by the Egg Board during any 
specific period of time, or (3) the publication, by direction of the 
Secretary, of the name of any person violating this subpart together 
with a statement of the particular provisions of this subpart violated 
by such person.
    (b) All information with respect to refunds, except as provided in 
paragraph (a)(2) of this section, made to individual producers shall be 
kept confidential by all officers and employees

[[Page 254]]

of the Department of Agriculture and the Board.

[40 FR 59190, Dec. 22, 1975. Redesignated at 55 FR 6973, Feb. 28, 1990]

                     Certification of Organizations



Sec. 1250.356  Certification of organizations.

    Any organization may request the Secretary for certification of 
eligibility to participate in nominating members and alternate members 
on the Board to represent the geographic area in which the organization 
represents egg producers. Such eligibility shall be based in addition to 
other available information upon a factual report submitted by the 
organization which shall contain information deemed relevant and 
specified by the Secretary for the making of such determination, 
including, but not limited to, the following:
    (a) Geographic territory covered by the organization's active 
membership;
    (b) Nature and size of the organization's active membership, 
proportion of total of such active membership accounted for by producers 
of commercial eggs, a chart showing the egg production by State in which 
the organization has members, and the volume of commercial eggs produced 
by the organization's active membership in such State(s);
    (c) The extent to which the commercial egg producer membership of 
such organization is represented in setting the organization's policies;
    (d) Evidence of stability and permanency of the organization;
    (e) Sources from which the organization's operating funds are 
derived;
    (f) Functions of the organization; and
    (g) The organization's ability and willingness to further the aims 
and objectives of the act.

The primary consideration in determining the eligibility of an 
organization shall be whether its egg producer membership consists of a 
substantial number of egg producers who produce a substantial volume of 
the applicable geographic area's commercial eggs to reasonably warrant 
its participation in the nomination of members for the Board or to 
request the issuance of an order. The Secretary shall certify any 
organization which he finds to be eligible under this section and his 
determination as to eligibility shall be final.

                              Miscellaneous



Sec. 1250.357  Suspension and termination.

    (a) The Secretary shall, whenever he finds that this subpart or any 
provision thereof obstructs or does not tend to effectuate the declared 
policy of the act, terminate or suspend the operation of this subpart or 
such provision.
    (b) The Secretary may conduct a referendum at any time, and shall 
hold a referendum on request of 10 percent or more of the number of egg 
producers voting in the referendum approving this subpart, to determine 
whether egg producers favor the termination or suspension of this 
subpart, and the Secretary shall suspend or terminate such subpart at 
the end of 6 months after he determines that suspension or termination 
of the subpart is approved or favored by a majority of the egg producers 
voting in such referendum who, during a representative period determined 
by the Secretary, have been engaged in the production of commercial 
eggs, and who produced more than 50 percent of the volume of eggs 
produced by the egg producers voting in the referendum.



Sec. 1250.358  Proceedings after termination.

    (a) Upon the termination of this subpart the Board shall recommend 
not more than six of its members to the Secretary to serve as trustees 
for the purpose of liquidating the affairs of the Board. Such persons, 
upon designation by the Secretary, shall become trustees of all the 
funds and property then in the possession or under control of the Board, 
including claims for any funds unpaid or property not delivered or any 
other claim existing at the time of such termination.
    (b) The said trustees shall: (1) Continue in such capacity until 
discharged by the Secretary, (2) carry out the obligations of the Board 
under any contracts or agreements entered into by it pursuant to Sec. 
1250.336, (3) from time to time account for all receipts and 
disbursements and deliver all property on hand, together with all books 
and

[[Page 255]]

records of the Board and of the trustees, to such person as the 
Secretary may direct, and (4) upon the request of the Secretary, execute 
such assignments or other instruments necessary or appropriate to vest 
in such person full title and right to all of the funds, property, and 
claims vested in the Board or the trustees pursuant to this subpart.
    (c) Any person to whom funds, property, or claims have been 
transferred or delivered pursuant to this subpart shall be subject to 
the same obligation imposed upon the Board and upon the trustees.
    (d) Any residual funds not required to defray the necessary expenses 
of liquidation shall be turned over to the Secretary to be disposed of, 
to the extent practicable, in the interest of continuing one or more of 
the research or promotion programs hitherto authorized.



Sec. 1250.359  Effect of termination or amendment.

    Unless otherwise expressly provided by the Secretary, the 
termination of this subpart or of any regulation issued pursuant hereto, 
or the issuance of any amendment to either thereof, shall not:
    (a) Affect or waive any right, duty, obligation, or liability which 
shall have risen or which may hereafter arise in connection with any 
provision of this subpart or any regulation issued thereunder;
    (b) Release or extinguish any violation of this subpart or any 
regulation issued hereunder; or
    (c) Affect or impair any rights or remedies of the United States, or 
of the Secretary, or of any person, with respect to any such violation.



Sec. 1250.360  [Reserved]



Sec. 1250.361  Right of the Secretary.

    All fiscal matters, programs or proj ects, rules or regulations, 
reports, or other substantive action proposed and prepared by the Board 
shall be submitted to the Secretary for his approval.



Sec. 1250.362  Amendments.

    Amendments to this subpart may be proposed, from time to time, by 
the Board, or by an organization certified pursuant to section 16 of the 
act, or by any interested person affected by the provisions of the act, 
including the Secretary.



Sec. 1250.363  Separability.

    If any provision of this subpart is declared invalid or the 
applicability thereof to any person or circumstances is held invalid, 
the validity of the remainder of this subpart of the applicability 
thereof to other persons or circumstances shall not be affected thereby.



                      Subpart_Rules and Regulations

    Source: 41 FR 22925, June 8, 1976, unless otherwise noted.

                               Definitions



Sec. 1250.500  Terms defined.

    Unless otherwise defined in this subpart, definitions of terms used 
in this subpart shall be those definitions of terms defined in the Egg 
Research and Consumer Information Act, hereinafter called the Act, and 
the Egg Research and Promotion Order, hereinafter called the Order.
    (a) Act. ``Act'' means the Egg Research and Consumer Information Act 
as it may be amended (Pub. L. 93-428).
    (b) Secretary. ``Secretary'' means the Secretary of Agriculture or 
any other officer or employee of the Department of Agriculture to whom 
there has heretofore been delegated, or to whom there may hereafter be 
delegated, the authority to act in his stead.
    (c) Egg Board or Board. ``Egg Board'' or ``Board'' or other 
designatory term adopted by such Board, with the approval of the 
Secretary, means the administrative body established pursuant to Sec. 
1250.326.
    (d) Fiscal period. ``Fiscal period'' means the calendar year unless 
the Egg Board, with the approval of the Secretary, selects some other 
budgetary period.
    (e) Egg producer or producer. ``Egg producer'' or ``producer'' means 
any person who either:

[[Page 256]]

    (1) Is an egg farmer who acquires and owns laying hens, chicks, and/
or started pullets for the purpose of and is engaged in the production 
of commercial eggs; or
    (2) Is a person who supplied or supplies laying hens, chicks, and/or 
started pullets to an egg farmer for the purpose of producing commercial 
eggs pursuant to an oral or written contractual agreement for the 
production of commercial eggs. Such person is deemed to be the owner of 
such laying hens unless it is established in writing, to the 
satisfaction of the Secretary or the Egg Board, that actual ownership of 
the laying hens is in some other party to the contract. In the event the 
party to an oral contract who supplied or supplies the layi