Pima Agriculture Cotton Trust Fund (Agriculture Pima Trust) and Agriculture Wool Apparel Manufacturers Trust Fund (Agriculture Wool Trust), 68875-68880 [2021-25982]

Agencies

• DEPARTMENT OF AGRICULTURE
• Commodity Credit Corporation

[Federal Register Volume 86, Number 231 (Monday, December 6, 2021)]
[Rules and Regulations]
[Pages 68875-68880]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-25982]



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Rules and Regulations
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains regulatory documents 
having general applicability and legal effect, most of which are keyed 
to and codified in the Code of Federal Regulations, which is published 
under 50 titles pursuant to 44 U.S.C. 1510.

The Code of Federal Regulations is sold by the Superintendent of Documents. 

========================================================================


Federal Register / Vol. 86, No. 231 / Monday, December 6, 2021 / 
Rules and Regulations

[[Page 68875]]



DEPARTMENT OF AGRICULTURE

Commodity Credit Corporation

7 CFR Part 1471


Pima Agriculture Cotton Trust Fund (Agriculture Pima Trust) and 
Agriculture Wool Apparel Manufacturers Trust Fund (Agriculture Wool 
Trust)

AGENCY: Commodity Credit Corporation and Foreign Agricultural Service, 
U.S. Department of Agriculture (USDA).

ACTION: Final rule.

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

SUMMARY: This final rule amends the USDA regulations on the Agriculture 
Pima Trust and Agriculture Wool Trust to make technical corrections to 
update outdated dates and references and to clarify the eligibility and 
manner in which payments will be calculated under the programs.

DATES: This rule is effective December 6, 2021.

FOR FURTHER INFORMATION CONTACT: Curt Alt; Telephone: (202) 690-4784; 
email: [email protected]. Persons with disabilities who require an 
alternative means for communication of information (e.g., Braille, 
large print, audiotape, etc.) should contact Angela Ubrey (Human 
Resources, 202-772-4836) or Constance Goodwin (Office of Civil Rights, 
202-379-6431).

SUPPLEMENTARY INFORMATION: The Agriculture Pima and Agriculture Wool 
Trusts provide annual payments to U.S. cotton and wool producers to 
reduce the injury resulting from tariffs on cotton and wool fabrics 
that are higher than tariffs on certain apparel articles made of cotton 
and wool fabric. The program regulations were last updated in 2019 to 
incorporate changes introduced in the Agriculture Improvement Act of 
2018 (2018 Farm Bill; Pub. L. 115-334), but the Commodity Credit 
Corporation (CCC) has identified areas where technical corrections are 
necessary to remove unnecessary and outdated references and dates. This 
final rule makes those technical corrections where needed.
    In addition, this final rule also clarifies the qualifying fabric 
in the payment calculation for manufacturers of cotton shirts to 
eliminate confusion for applicants and reduce the risk of waste, fraud, 
and abuse. The clarifying revisions are intended to resolve any 
confusion among manufacturers of cotton shirts as to the calculation of 
qualifying fabric to be submitted in their affidavits. CCC is updating 
the regulations to clarify, consistent with Section 12314 of the 
Agricultural Act of 2014 (Pub. L. 113-79), as revised in Section 12602 
of the 2018 Farm Bill, that the reporting and documentation 
requirements for the requested affidavits is based on qualifying fabric 
that was purchased in the preceding year in the amount of qualifying 
fabric that was actually used by the manufacturer in the production of 
men's and boys' shirts in that year in order to reduce the potential 
for improper payments. This clarification is intended to ensure that 
CCC calculates payments on the same qualifying fabric basis for all 
applicants. The value of qualifying fabric purchased for any other 
purpose, including fabric held in inventory or destined for resale or 
other use, is not eligible for payment under the Agriculture Pima Trust 
and should not be included by the manufacturer in the amount reported 
in its affidavit.
    This rule involves a matter relating to agency management or 
personnel or to public property, loans, grants, benefits, or contracts. 
Accordingly, notice and other public procedure on this rule are 
unnecessary and this rule may be made effective less than 30 days after 
publication in the Federal Register. See 5 U.S.C. 553. Further, this 
action is not a rule as defined by the Regulatory Flexibility Act (5 
U.S.C. 601) and, thus, is exempt from the provisions of that Act.

E-Government Act Compliance

    CCC is committed to complying with the E-Government Act of 2002 (44 
U.S.C. chapter 36), to promote the use of the internet and other 
information technologies to provide increased opportunities for 
citizens' access to Government information and services, and for other 
purposes.

Executive Order 12866 and 13563

    Executive Order 12866, ``Regulatory Planning and Review,'' and 
Executive Order 13563, ``Improving Regulation and Regulatory Review,'' 
direct agencies to assess all costs and benefits of available 
regulatory alternatives and, if regulation is necessary, to select 
regulatory approaches that maximize net benefits (including potential 
economic, environmental, public health and safety effects, distributive 
impacts, and equity). Executive Order 13563 emphasized the importance 
of quantifying both costs and benefits, of reducing costs, of 
harmonizing rules, and of promoting flexibility. The requirements in 
Executive Orders 12866 and 13573 for the analysis of costs and benefits 
apply to rules that are determined to be significant. It has been 
determined that this action is not significant for the purposes of 
Executive Order 12866; therefore, was not reviewed by the Office of 
Management and Budget.

Congressional Review Act

    Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.), 
the Office of Information and Regulatory Affairs has designated this 
action as not a major rule, as defined by 5 U.S.C. 804(2).

Executive Order 12988

    This rule has been reviewed in accordance with Executive Order 
12988, ``Civil Justice Reform.'' This rule does not preempt State or 
local laws, regulations, or policies unless they present an 
irreconcilable conflict with this rule. This rule will not be 
retroactive.

Executive Order 12372

    Executive Order 12372, ``Intergovernmental Review of Federal 
Programs,'' requires consultation with officials of State and local 
governments that would be directly affected by the proposed Federal 
financial assistance. The objectives of the Executive order are to 
foster an intergovernmental partnership and a strengthened federalism 
by relying on State and local processes for the State and local 
government coordination and review of proposed Federal financial 
assistance and direct Federal development. This rule will not directly 
affect State or local officials and, for this reason, it is

[[Page 68876]]

excluded from the scope of Executive Order 12372.

Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601-612), as amended by 
the Small Business Regulatory Enforcement Fairness Act of 1996, 
generally requires an agency to prepare a regulatory flexibility 
analysis of any rule that is subject to notice and comment rulemaking 
under the Administrative Procedure Act (APA) or any other law, unless 
the agency certifies that the rule will not have a significant economic 
impact on a substantial number of small entities. The Regulatory 
Flexibility Act does not apply to this rule because CCC is not required 
by the APA or any other law to publish a notice of proposed rulemaking 
with respect to the subject matter of the rule.

Executive Order 13132

    This rule has been reviewed under Executive Order 13132, 
``Federalism.'' This rule will not have any substantial direct effect 
on States, on the relationship between the Federal Government and the 
States, or on the distribution of power and responsibilities among the 
various levels of government, except as required by law. This rule does 
not impose substantial direct compliance costs on State and local 
governments. Therefore, consultation with the States was not required.

Executive Order 13175

    This rule has been reviewed in accordance with the requirements of 
Executive Order 13175, ``Consultation and Coordination with Indian 
Tribal Governments.'' Executive Order 13175 requires Federal agencies 
to consult and coordinate with tribes on a government-to-government 
basis on policies that have tribal implications, including regulations, 
legislative comments or proposed legislation, and other policy 
statements or actions that have substantial direct effects on one or 
more Indian tribes, on the relationship between the Federal Government 
and Indian tribes, or on the distribution of power and responsibilities 
between the Federal Government and Indian tribes. CCC does not expect 
this rule to have any effect on Indian tribes.

Unfunded Mandates

    Title II of the Unfunded Mandate Reform Act of 1995 (UMRA, Pub. L. 
104-4) requires Federal agencies to assess the effects of their 
regulatory actions on State, local, or Tribal governments or the 
private sector. Agencies generally must prepare a written statement, 
including a cost benefit analysis, for proposed and final rules with 
Federal mandates that may result in expenditures of $100 million or 
more in any 1 year for State, local, or Tribal governments, in the 
aggregate, or to the private sector. UMRA generally requires agencies 
to consider alternative methods and adopt the more cost effective or 
least burdensome alternative that achieves the objectives of the rule. 
This rule contains no Federal mandates under the regulatory provisions 
of Title II of the Unfunded Mandates Reform Act of 1995 for State, 
local, or Tribal governments, or the private sector. Therefore, this 
rule is not subject to the requirements of sections 202 and 205 of 
UMRA.

Paperwork Reduction Act

    This final rule contains no new reporting, recordkeeping, or third-
party disclosure requirements under the Paperwork Reduction Act of 1995 
(44 U.S.C. 3501 et seq.).

List of Subjects in 7 CFR Part 1471

    Agricultural commodities, Imports.

    For the reasons set forth in the preamble, CCC revises 7 CFR part 
1471 to read as follows:

PART 1471--PIMA AGRICULTURE COTTON TRUST FUND (AGRICULTURE PIMA 
TRUST) AND AGRICULTURE WOOL APPAREL MANUFACTURERS TRUST FUND 
(AGRICULTURE WOOL TRUST)

Subpart A--Agriculture Pima Trust
Sec.
1471.1 Provisions common to this subpart.
1471.2 Pima cotton payments.
1471.3 Affidavit of producers of ring spun pima cotton yarn.
1471.4 Affidavit of manufacturers of pima cotton shirts.
1471.5 Affidavit of pima cotton trade associations.
Subpart B--Agriculture Wool Trust
1471.10 Provisions common to this subpart.
1471.11 Payments to manufacturers of certain worsted wool fabrics.
1471.12 Refund of duties paid on imports of certain wool products.
1471.13 Monetization of the wool tariff rate quota.
1471.14 Wool yarn, wool fiber, and wool top duty compensation 
payment.

    Authority: Sections 12314 and 12315, Pub. L. 113-79, 128 Stat. 
649, as amended by sections 12602 and 12603, Pub. L. 115-334, 132 
Stat. 4490 (7 U.S.C. 2101 note and 7101 note).

Subpart A--Agriculture Pima Trust


Sec.  1471.1   Provisions common to this subpart.

    (a) Agriculture Pima Trust--(1) Establishment. The Agriculture Pima 
Trust has been established to provide funding for payments under this 
subpart.
    (2) Purpose. The purpose of the Agriculture Pima Trust is to reduce 
the injury to domestic manufacturers resulting from tariffs on cotton 
fabric that are higher than tariffs on certain apparel articles made of 
cotton fabric.
    (3) Funding availability. $16,000,000 will be available annually 
for eligible payments authorized under this subpart.
    (4) Definitions. As used in this subpart:
    Agriculture Pima Trust means the Pima Agriculture Cotton Trust 
Fund.
    CCC means the Commodity Credit Corporation.
    FAS means the Foreign Agricultural Service.
    Secretary means the Secretary of Agriculture.
    U.S. means the United States of America.
    (b) Other provisions common to this subpart--(1) Affidavits. FAS 
shall annually, not later than February 15 of the year of the 
applicable payment, make affidavits available on the FAS website. 
Affidavits must be submitted in accordance with the instructions 
provided on the FAS website.
    (2) Filing deadline. Any person filing an affidavit under this 
subpart for a particular year must file the affidavit not later than 
March 15 of the applicable calendar year.
    (3) Affirmation. By submitting an affidavit under this subpart, an 
applicant is affirming that all information contained in the 
application is complete and correct and that the information does not 
contain a false claim, statement, or representation.
    (4) Document retention. All persons receiving a payment under this 
subpart must maintain all pertinent documentation for 3 years after the 
year of receipt of the payment.
    (5) False statements. Persons providing false or fraudulent claims, 
or persons making materially false statements or representations in 
their affidavit, are subject to civil or criminal penalties pursuant to 
18 U.S.C. 1001.
    (6) Confidentiality. Specific business information that is marked 
``business confidential'' will be protected from disclosure to the full 
extent permitted by law.
    (7) Review of affidavits. Affidavits will be reviewed to determine 
whether they are complete and responsive to the

[[Page 68877]]

content and form of affidavit requirements under this subpart.
    (8) Finality of determinations by Secretary. A determination by the 
Secretary about a payment under this subpart shall be final and is not 
subject to appeal or protest.
    (9) Timing of payments. A payment for which a person is eligible 
under this subpart will be disbursed not later than April 15 of the 
applicable year.
    (10) Sequester. Payments covered by this subpart shall be subject 
to sequester of payments, if required by law.


Sec.  1471.2  Pima cotton payments.

    From available funds in the Agriculture Pima Trust, CCC will 
annually make payments as follows:
    (a) Twenty-five percent of the amounts in the Agriculture Pima 
Trust shall be paid to one or more nationally recognized associations 
established for the promotion of pima cotton for use in textile and 
apparel goods, as determined by the Secretary, during the calendar year 
immediately preceding the payment.
    (b) Twenty-five percent of the amounts in the Agriculture Pima 
Trust shall be paid to yarn spinners of pima cotton that produce ring 
spun cotton yarns in the U.S. during the calendar year immediately 
preceding the payment, to be allocated to each yarn spinner in an 
amount that bears the same ratio as:
    (1) The yarn spinner's production of ring spun cotton yarns 
measuring less than 83.33 decitex (exceeding 120 metric number) from 
pima cotton in single and plied form during the prior calendar year; 
bears to
    (2) The production of the yarns described in paragraph (b)(1) of 
this section during the prior calendar year by all yarn spinners that 
qualify under this paragraph (b).
    (3) A yarn spinner will not receive an amount under this paragraph 
(b) that exceeds the cost of pima cotton that was:
    (i) Purchased during the prior calendar year; and
    (ii) Used in spinning any cotton yarns.
    (4) The Secretary will reallocate any amounts reduced by reason of 
the limitation under paragraph (b)(3) of this section to spinners using 
the ratio described in this paragraph (b), disregarding production of 
any spinner subject to that limitation.
    (c) Fifty percent of the amounts in the Agriculture Pima Trust 
shall be paid to manufacturers that certify, pursuant to the affidavit 
under Sec.  1471.4, that, during the calendar year immediately 
preceding the payment, they used imported cotton fabric to produce 
men's and boys' shirts, to be allocated to each manufacturer in an 
amount that bears the same ratio as:
    (1) The dollar value (excluding duty, shipping, and related costs) 
of imported woven cotton shirting fabric of 80s or higher count and 2-
ply in warp purchased by the manufacturer during the prior calendar 
year to produce men's and boys' shirts; bears to
    (2) The dollar value (excluding duty, shipping, and related costs) 
of the fabric described in paragraph (c)(1) of this section purchased 
during the prior calendar year by all manufacturers that qualify under 
this paragraph (c).


Sec.  1471.3  Affidavit of producers of ring spun pima cotton yarn.

    In addition to any applicable information requirements in Sec.  
1471.1, a producer of ring spun cotton yarn must annually provide an 
affidavit that affirms:
    (a) During the calendar year immediately preceding the payment, the 
yarn spinner used pima cotton to produce ring spun cotton yarns in the 
U.S. measuring less than 83.33 decitex (exceeding 120 metric number), 
in single and plied form;
    (b) In the prior calendar year, the yarn spinner actually produced 
the quantity, measured in pounds, of ring spun cotton yarns measuring 
less than 83.33 decitex (exceeding 120 metric number), in single and 
plied form, reported on the affidavit;
    (c) The yarn spinner maintains supporting documentation about such 
production during the prior calendar year that shows the actual 
quantity of such yarns produced, and evidencing the yarns as ring spun 
pima cotton yarns measuring less than 83.33 decitex (exceeding 120 
metric number), in single and plied form; and
    (d) The dollar amount of pima cotton purchased during the prior 
calendar year that was used in spinning any cotton yarns, and for which 
the producer maintains supporting documentation.


Sec.  1471.4  Affidavit of manufacturers of cotton shirts.

    (a) Definition of qualifying fabric. In this section, the term 
``qualifying fabric'' means imported woven cotton shirting fabric of 
80s or higher count and 2-ply in warp.
    (b) In general. In addition to any applicable information 
requirements in Sec.  1471.1, a producer of men's and boys' cotton 
shirts must annually provide an affidavit that affirms:
    (1) During the calendar year immediately preceding the payment, the 
manufacturer used qualifying fabric to cut and sew men's and boys' 
cotton shirts in the U.S. and the manufacturer has maintained 
production records evidencing the dollar value of qualifying fabric 
used to cut and sew men's and boys' cotton shirts;
    (2) The dollar value of qualifying fabric purchased by the 
manufacturer during the calendar year immediately preceding the 
payment, except that the dollar value of fabric reported shall not 
exceed the dollar value of qualifying fabric used by the manufacturer 
to cut and sew men's and boys' woven cotton shirts in the U.S. during 
the calendar year immediately preceding the payment, as supported by 
production records maintained under paragraph (b)(1) of this section;
    (3) The manufacturer maintains invoices and other supporting 
documentation (such as price lists and other technical descriptions of 
the fabric qualities) showing the dollar value of qualifying fabric 
purchased, the date of purchase, and evidencing the fabric as 
qualifying fabric; and
    (4) The imported cotton fabric purchased in the calendar year 
immediately preceding the payment was suitable for use in the 
manufacturing of men's and boys' cotton shirts.
    (c) Date of purchase. For purposes of the affidavit under paragraph 
(b) of this section, the date of purchase shall be the invoice date.
    (d) Dollar value of purchase. For purposes of the affidavit under 
paragraph (b) of this section, the dollar value shall be determined 
excluding duty, shipping, and related costs.
    (e) Fabric use. For purposes of the affidavit under paragraph (b) 
of this section, and in specific reference to paragraph (b)(2) of this 
section, a manufacturer shall not report a dollar value of qualifying 
fabric purchased that is more than the dollar value of qualifying 
fabric that it used to cut and sew men's and boys' shirts during the 
calendar year immediately preceding the payment. The value of 
qualifying fabric purchased for any other purpose, including fabric 
held in inventory or destined for resale or other use, is not eligible 
for payment under the Agriculture Pima Trust and shall not be included 
by the manufacturer in the amount reported under paragraph (b)(2) of 
this section.


Sec.  1471.5  Affidavit of pima cotton trade associations.

    In addition to any applicable information requirements in Sec.  
1471.1, trade associations filing a claim for a payment under the 
Agriculture Pima Trust must provide a statement that states that during 
the calendar year

[[Page 68878]]

immediately preceding the payment they were, as determined by the 
Secretary, a domestic nationally recognized association established and 
operating for the promotion of pima cotton for domestic use in textile 
and apparel goods.

Subpart B--Agriculture Wool Trust


Sec.  1471.10  Provisions common to this subpart.

    (a) Agriculture Wool Trust--(1) Establishment. The Agriculture Wool 
Trust has been established to provide funding for payments under this 
subpart.
    (2) Purpose. The purpose of the Agriculture Wool Trust is to reduce 
the injury to domestic manufacturers resulting from tariffs on wool 
fabric that are higher than tariffs on certain apparel articles made of 
wool fabric.
    (3) Funding availability. Not more than $30,000,000 will be 
available annually for payments authorized under this subpart.
    (4) Definitions. As used in this subpart:
    Agriculture Wool Trust means the Agriculture Wool Apparel 
Manufacturers Trust Fund.
    CCC means the Commodity Credit Corporation.
    FAS means the Foreign Agricultural Service.
    HTS means the Harmonized Tariff Schedule of the United States.
    Secretary means the Secretary of Agriculture.
    TRQ means Tariff Rate Quota.
    U.S. means the United States of America.
    (b) Provisions common to this subpart--(1) Affidavits. FAS shall 
annually, not later than February 15 of the year of the applicable 
payment, make affidavits available on the FAS website. Affidavits must 
be submitted in accordance with the instructions provided on the FAS 
website.
    (2) Filing deadline. Any person filing an affidavit under this 
subpart for a particular year must file the affidavit not later than 
March 1 of such year.
    (3) Affirmation. By submitting an affidavit under this subpart, an 
applicant is affirming that all information contained in the 
application is complete and correct and that the information does not 
contain a false claim, statement, or representation.
    (4) Document retention. All persons receiving a payment under this 
subpart must maintain all pertinent documentation for three years after 
the year of receipt of the payment.
    (5) False statements. Persons providing false or fraudulent claims 
or making materially false statements or representations are subject to 
civil or criminal penalties pursuant to 18 U.S.C. 1001.
    (6) Confidential information. Specific business information 
provided in affidavits that is marked ``business confidential'' will be 
protected from disclosure to the full extent permitted by law.
    (7) Review of affidavits. Affidavits will be reviewed to determine 
whether they are complete and responsive to the content and form of 
affidavit requirements in this subpart.
    (8) Finality of determination by the Secretary. A determination by 
the Secretary about a payment under this subpart shall be final and is 
not subject to appeal or protest.
    (9) Timing of payments. A payment for which a person is eligible 
under this subpart will be disbursed not later than April 15 of the 
applicable year.
    (10) Proration and sequester. Payments covered by this subpart will 
be subject to proration in the event that insufficient funds exist in 
the Agriculture Wool Trust during the year of the payment, and will be 
subject to sequester, if required by law.
    (11) HTS subheadings. All references to subheadings of the HTS in 
this subpart are to the subheadings as described in the HTS in 2014.


Sec.  1471.11  Payments to manufacturers of certain worsted wool 
fabrics.

    (a) Definitions. In this section the following definitions apply:
    Eligible person means a manufacturer in the U.S. of qualifying 
worsted wool fabric during the calendar year immediately preceding the 
payment and during each of calendar years 1999, 2000, and 2001.
    Qualifying worsted wool fabric means a worsted wool fabric 
containing at least 85% by weight worsted wool of the kind described in 
subheading 9902.51.11 or 9902.51.15 of the 2014 HTS that, during the 
calendar year immediately preceding the payment and during each of 
calendar years 1999, 2000, and 2001, was manufactured by an eligible 
person in the United States.
    (b) Distribution of funds. From amounts in the Agriculture Wool 
Trust, CCC will annually make payments to eligible persons that 
manufactured qualifying worsted wool fabric as provided in paragraph 
(b)(1) or (2) of this section.
    (1) Payments for production under subheading 9902.51.11 of the HTS. 
A total of $2,666,000 will be allocated annually among eligible persons 
covered by this paragraph (b)(1) on the basis of the percentage of each 
eligible person's total production (actual production, not estimates) 
of qualifying worsted wool fabric that is of the kind described in 
subheading 9902.51.11 of the HTS for each of the calendar years 1999, 
2000, and 2001 in relation to the total production of such fabric by 
all eligible persons who qualify for payments under this paragraph 
(b)(1) for each of the calendar years 1999, 2000, and 2001.
    (2) Payments for production under subheading 9902.51.15. A total of 
$2,666,000 will be allocated annually among eligible persons covered by 
this paragraph (b)(2) on the basis of the percentage of each eligible 
person's total production (actual production, not estimates) of 
qualifying worsted wool fabric that conforms in composition to 
subheading 9902.51.15 of the HTS for each of the calendar years 1999, 
2000, and 2001 in relation to the total production of such fabric by 
all eligible persons who qualify for payments under this paragraph 
(b)(2) for each of the calendar years 1999, 2000, and 2001.
    (c) Annual affidavit--(1) In general. An eligible person applying 
for a payment under this section shall comply with all applicable 
reporting requirements of this section and of Sec.  1471.10.
    (2) Specific business information. An eligible person shall 
annually report the actual dollar value and the actual quantity (linear 
yards) of qualifying worsted wool fabric that was manufactured in the 
calendar year immediately preceding the payment and for each of 
calendar years 1999, 2000, and 2001.
    (3) Manufacturing of wool. When reporting the annual dollar value 
and quantity of the qualifying wool fabric that was manufactured, an 
eligible person may either have manufactured the qualifying worsted 
wool on its own behalf or had another person manufacture the qualifying 
worsted wool fabric, provided the eligible person owned the qualifying 
worsted wool fabric at the time of manufacture.


Sec.  1471.12  Refund of duties paid on imports of certain wool 
products.

    (a) Eligible wool. Eligible wool under the Duty Refund program 
means imported wool yarn of the kind described in section 505 of the 
Trade and Development Act of 2000 Public Law 106-200 (May 18, 2000).
    (b) Payments--(1) Eligibility. Persons eligible for a Duty Refund 
payment are manufacturers who, in the year immediately preceding the 
payment, were actively engaged in manufacturing wool (as determined by 
FAS), and in calendar years 2000, 2001, and 2002--

[[Page 68879]]

    (i) Imported eligible wool directly or indirectly; and
    (ii) Used the imported wool to make men's or boy's suits; or
    (iii) Further manufactured the eligible imported wool.
    (2) Payment amount. Persons eligible for a Duty Refund payment 
shall be paid the same amounts that were made to the persons by U.S. 
Customs and Border Protection (CBP) in 2005.


Sec.  1471.13  Monetization of the wool tariff rate quota.

    (a) Definitions. In this section the following definitions apply:
    (1) Lower duty rate. The term ``lower duty rate'' means the duty 
rate as codified in the 2014 HTS that would have been applicable to 
qualifying worsted wool fabric of the kind described in subheadings 
9902.51.11, 9902.51.15, and 9902.51.16 of the 2014 HTS prior to the 
expiration of the Wool TRQ on December 31, 2014.
    (2) Eligible person. The term ``eligible person'' means a 
manufacturer (or a successor-in-interest to the manufacturer) in the 
U.S. or in a Foreign Trade Zone authorized under the Foreign-Trade 
Zones Act of 1934 (19 U.S.C. 81a-81u) that, during the calendar year 
immediately preceding the payment, imported qualifying worsted wool 
fabric and used the imported qualifying worsted wool fabric as 
described in paragraph (a)(3) of this section.
    (3) Qualifying worsted wool fabric. The term ``qualifying worsted 
wool fabric'' means imported worsted wool fabric containing at least 
85% by weight worsted wool of the kind described in subheading 
9902.51.11, 9902.51.15, or 9902.51.16 of the 2014 HTS that, during the 
calendar year immediately preceding the payment was:
    (i) Imported by an eligible person in the U.S.; and
    (ii) Used by the eligible person in the U.S.
    (A) In the case of wool fabric of the kind described in subheading 
9902.51.11 or 9902.51.15 of the HTS, the qualifying fabric shall be 
used to produce worsted wool suits, suit-type jackets, or trousers for 
men and boys; or
    (B) In the case of wool fabric of the kind described in subheading 
9902.51.16 of the HTS, the qualifying fabric shall be used in 
manufacturing.
    (4) Successor-in-interest. The term ``successor-in-interest'' means 
a person that is eligible to claim a payment under this section as if 
the person were the original eligible person, without regard to section 
3727, title 31, United States Code. A person may succeed to the status 
of the successor-in-interest to the eligible person and become eligible 
for the payment because of--
    (i) An assignment of the claim;
    (ii) An assignment of the original eligible person's right to 
manufacture under the same trade name; or
    (iii) A reorganization of the eligible person.
    (b) Purposes. The purposes of a TRQ monetization payment are to 
provide an eligible person--
    (1) Compensation for termination of the TRQ for qualifying worsted 
wool fabric; and
    (2) A payment that is equivalent to the amount the eligible person 
would have saved during the calendar year immediately preceding the 
payment for imports of qualifying worsted wool fabric if the lower duty 
rate under the applicable 2014 HTS subheading(s) of a qualifying 
worsted wool fabric were in effect.
    (c) Calculation of monetized TRQ payment. A payment will be 
established by calculating the savings that would have been realized by 
the eligible person for imports of qualifying worsted wool fabric had 
the lower duty rate been in effect by--
    (1) Establishing the reported dollar value of imported worsted wool 
fabric, for each of the 2014 HTS subheadings of worsted wool fabric, 
during the calendar year immediately preceding the payment;
    (2) Subtracting the duty rate (converted to numeric value) for each 
applicable 2014 HTS subheading of worsted wool fabric that would have 
been paid in calendar year 2014 from the duty rate (converted to 
numeric value) that was actually paid in the calendar year immediately 
preceding the payment;
    (3) For each applicable 2014 HTS subheading of worsted wool fabric, 
multiplying the numeric values described in paragraphs (c)(1) and (2) 
of this section; and
    (4) Adding each product obtained in paragraph (c)(3) of this 
section.
    (d) Annual affidavit--(1) In general. An eligible person applying 
for a payment under this section shall comply with all applicable 
reporting requirements of this section and of Sec.  1471.10.
    (2) Specific business information--(i) Imports and production. An 
eligible person shall, for the entire calendar year immediately 
preceding the payment, report the actual dollar value and the actual 
quantity (square meters) of their imports into the U.S. of qualifying 
worsted wool fabric and the amount of qualifying worsted wool fabric 
used by the eligible person in the U.S.
    (ii) Direct and indirect importers. Eligible persons that directly 
import qualifying worsted wool fabric and pay the import duty for such 
wool are considered to be direct importers of the qualifying worsted 
wool fabric. Persons that import qualifying worsted wool fabric through 
a third party broker are considered to be indirect importers of the 
qualifying worsted wool fabric. Eligible persons must state in their 
annual affidavit whether, in the calendar year immediately preceding 
the payment, they were direct or indirect importers, and the dollar 
value of the imported qualifying worsted wool fabric. The reported 
dollar value of such imports by indirect importers will be subject to a 
10% reduction.
    (iii) Import documentation. Eligible persons must maintain 
supporting documentation for the amounts reported on their affidavits 
and shall provide copies of such supporting documentation upon the 
request of FAS.
    (3) Production of garments or manufacturing of qualifying worsted 
wool fabric--(i) Production of garments. When reporting the annual 
dollar value and quantity of imported qualifying worsted wool fabric of 
the kind described in subheadings 9902.51.11 and 9902.51.15 of the 2014 
HTS, an eligible person may either have cut and sewn the wool on its 
own behalf or had another person cut and sew the wool on behalf of the 
eligible person, provided the eligible person owned the wool at the 
time it was cut and sewn.
    (ii) Manufacturing of qualifying worsted wool fabric. When 
reporting the annual dollar value and quantity of imported qualifying 
worsted wool fabric of the kind described in subheading 9902.51.16 of 
the 2014 HTS, an eligible person may either have manufactured the wool 
on its own behalf or had another person manufacture the wool on behalf 
of the eligible person, provided the eligible person owned the wool at 
the time of manufacture.


Sec.  1471.14  Wool yarn, wool fiber, and wool top duty compensation 
payment.

    (a) Definitions. In this section the following definitions apply:
    (1) Duty. The term ``duty'' means the duty rate codified in the HTS 
for a year that is applicable to qualifying wool of the kind described 
in subheadings 9902.51.13 and 9902.51.14 of the 2014 HTS.
    (2) Eligible person. The term ``eligible person'' means a 
manufacturer (or a successor-in-interest to the manufacturer) in the 
U.S. or in a Foreign Trade Zone authorized under the Foreign-Trade 
Zones Act of 1934 (19 U.S.C. 81a-81u) that, during the

[[Page 68880]]

calendar year immediately preceding the payment, imported qualifying 
wool and manufactured the qualifying wool directly or had another 
person manufacture the qualifying wool, providing the eligible person 
owned the qualifying wool at the time it was manufactured.
    (3) Qualifying wool. The term ``qualifying wool'' means imported 
wool yarn of the kind described in subheading 9902.51.13 of the 2014 
HTS or imported wool fiber or wool top of the kind described in 
subheading 9902.51.14 of the 2014 HTS, that, during the calendar year 
immediately preceding the payment, was imported, either directly or 
indirectly, by an eligible person (or a successor-in-interest) into the 
U.S. and manufactured by the eligible person in the U.S.
    (4) Successor-in-interest. The term ``successor-in-interest'' means 
a person that is eligible to claim a payment under this section as if 
the person were the original eligible manufacturer, without regard to 
section 3727, title 31, United States Code. A person may succeed to the 
status of the successor-in-interest to the eligible person and become 
eligible for the payment because of--
    (i) An assignment of the claim;
    (ii) An assignment of the eligible person's right to manufacture 
under the same trade name; or
    (iii) A reorganization of the eligible person.
    (b) Import duties. The duties on imports of qualifying wool were 
suspended in their entirety in section 503 of the Trade and Development 
Act of 2000. The suspension of the duties for both HTS subheadings of 
qualifying wool was extended through December 31, 2014. These duties 
were reinstated as of January 1, 2015.
    (c) Duty compensation payment--(1) Calculation of payment. The duty 
compensation payment of an eligible person will be established by 
calculating, as provided in paragraphs (c)(2) through (4) of this 
section, the savings that would have been realized by the eligible 
person for imports of qualifying wool had the duty suspension been in 
effect.
    (2) Savings for each subheading. The savings realized by an 
eligible person for imports of qualifying wool under a HTS subheading 
covered by this section shall be obtained by multiplying:
    (i) The reported dollar value of imports under a HTS subheading 
during the calendar year immediately preceding the payment; and
    (ii) The duty applicable to that HTS subheading in the calendar 
year preceding the payment, converted to numeric value.
    (3) Sum of subheading savings. The product obtained in paragraph 
(c)(2) of this section for imports of qualifying wool previously 
described under each HTS subheading shall be added to the savings 
obtained for imports under the other HTS subheading (as applicable).
    (4) Duty compensation payment amount. The sum obtained in paragraph 
(c)(3) of this section shall equal the annual duty compensation payment 
for the eligible person for the applicable calendar year.
    (d) Annual affidavit required--(1) In general. An eligible person 
applying for a payment under this section shall comply with all 
applicable reporting requirements described in this section and Sec.  
1471.10.
    (2) Specific business information--(i) Imports and production. An 
eligible person shall, for the calendar year immediately preceding the 
payment, report the actual dollar value and the actual quantity of:
    (A) Imports into the U.S. of qualifying wool by the eligible 
person; and
    (B) Such qualifying wool that was manufactured in the U.S. by the 
eligible person.
    (ii) Direct and indirect importers--(A) In general. Eligible 
persons that import qualifying wool through a third party broker are 
considered to be indirect importers of the qualifying wool. Persons 
that directly import qualifying wool and pay the import duty for such 
wool are considered to be direct importers of the qualifying wool.
    (B) Reported dollar value. Eligible persons must state in their 
annual affidavit whether, in the calendar year immediately preceding 
the payment, they were direct or indirect importers, and the dollar 
value of the imported qualifying wool. The reported dollar value of 
imports by indirect importers will be subject to a 10% reduction.
    (C) Affirmation. An eligible person shall annually affirm in the 
affidavit that, in the calendar year immediately preceding the payment, 
the eligible person:
    (1) Directly or indirectly imported the qualifying wool into the 
U.S.;
    (2) Manufactured the qualifying wool in the U.S.; and
    (3) Imported qualifying wool from the country of origin identified 
in the affidavit.
    (iii) Import documentation. Eligible persons must maintain 
supporting documentation for the amounts reported on their affidavits 
and shall provide copies of such supporting documentation upon the 
request of FAS.
    (3) Manufacture of qualifying wool. When reporting the annual 
dollar value and quantity of imported qualifying wool, and the annual 
dollar value and quantity of the qualifying wool that was manufactured, 
an eligible person may either have manufactured the qualifying wool on 
its own behalf or had another person manufacture the qualifying wool, 
provided the eligible person owned the qualifying wool at the time of 
manufacture.

Robert Ibarra,
Executive Vice President, Commodity Credit Corporation.

    In concurrence with:
Daniel Whitley,
Administrator, Foreign Agricultural Service.
[FR Doc. 2021-25982 Filed 12-3-21; 8:45 am]
BILLING CODE 3410-10-P