Emerging Markets Program

Citation84 FR 69985
Record Number2019-27246
Published date20 December 2019
SectionRules and Regulations
CourtCommodity Credit Corporation
Federal Register, Volume 84 Issue 245 (Friday, December 20, 2019)
[Federal Register Volume 84, Number 245 (Friday, December 20, 2019)]
                [Rules and Regulations]
                [Pages 69985-69993]
                From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
                [FR Doc No: 2019-27246]
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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. 84, No. 245 / Friday, December 20, 2019 /
                Rules and Regulations
                [[Page 69985]]
                DEPARTMENT OF AGRICULTURE
                Commodity Credit Corporation
                7 CFR Part 1486
                RIN 0551-AA95
                Emerging Markets Program
                AGENCY: Commodity Credit Corporation and Foreign Agricultural Service,
                USDA.
                ACTION: Final rule.
                -----------------------------------------------------------------------
                SUMMARY: This final rule is revising the Emerging Markets Program (EMP)
                regulations to incorporate legislative changes introduced in the
                Agriculture Improvement Act of 2018 and to incorporate changes that
                conform the operation of the program to the requirements in the
                ``Uniform Administrative Requirements, Cost Principles, and Audit
                Requirements for Federal Awards'' (Uniform Guidance) and Federal grant-
                making best practices.
                DATES: This rule is effective on December 20, 2019.
                FOR FURTHER INFORMATION CONTACT: Curt Alt, (202) 690-4784,
                [email protected].
                SUPPLEMENTARY INFORMATION:
                Background
                 The EMP is authorized by Section 203 of the Agricultural Trade Act
                of 1978 (7 U.S.C. 5623), as amended. The EMP regulations appear at 7
                CFR part 1486. The Agriculture Improvement Act of 2018 (Pub. L. 115-
                334), which reauthorized the program for fiscal years 2019-2023,
                introduced legislative changes to the program that improve the
                program's flexibility and usefulness to stakeholders, such as the
                delinking of proposed technical assistance activities from an
                assessment and an expansion of permitted travel activities. In
                addition, this rule updates the regulations to bring the operation of
                the program into conformance with the requirements in the Uniform
                Guidance. Additional changes are desirable to bring the administration
                of the program into line with the current best practices in Federal
                grantmaking.
                Notice and Comment
                 This rule is being issued as a final rule without prior notice and
                opportunity for comment. The Administrative Procedure Act (5 U.S.C.
                553) exempts rules ``relating . . . to public property, loans, grants,
                benefits, or contracts'' from the statutory requirements for prior
                notice and opportunity for comment and publication of the rule not less
                than 30 days before its effective date (5 U.S.C. 553(a)(2)).
                Accordingly, this final rule is effective when published in the Federal
                Register.
                Catalog of Federal Domestic Assistance
                 The program covered by this regulation is listed in the Catalog of
                Federal Domestic Assistance (CFDA) under the following FAS CFDA number:
                10.603, Emerging Markets Program.
                E-Government Act Compliance
                 The Foreign Agricultural Service (FAS) 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 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 governments, and, for this reason, it is excluded
                from the scope of Executive Order 12372.
                Executive Order 12866 and 13563
                 Executive Orders 12866 and 13563 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 emphasizes the importance of quantifying both costs and
                benefits, of reducing costs, of harmonizing rules, and of promoting
                flexibility. This final rule has been determined to be not significant
                and was not reviewed by the Office of Management and Budget (OMB) in
                conformance with Executive Order 12866.
                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
                rule as not a major rule, as defined by 5 U.S.C. 804(2).
                Executive Order 13175
                 This rule has been reviewed for compliance with Executive Order
                13175, ``Consultation and Coordination with Indian Tribal
                Governments.'' Executive Order 13175 requires Federal agencies to
                consult and coordinate with tribes on a government-to-government basis
                on policies that have tribal implications, including regulations,
                legislative comments, proposed legislation, and other policy statements
                or actions that have substantial direct effects on one or more Indian
                tribes, on the relationship between the Federal Government and Indian
                tribes or on the distribution of power and responsibilities between the
                Federal Government and Indian tribes. FAS has assessed the impact of
                this rule on Indian tribes and determined that this rule does not, to
                the knowledge of FAS, have tribal implications that require tribal
                consultation under Executive Order 13175. If a tribe requests
                consultation, FAS will work with USDA Office of Tribal Relations to
                ensure meaningful consultation is provided where changes, additions,
                and
                [[Page 69986]]
                modifications identified herein are not expressly mandated by Congress.
                Executive Order 13771
                 Executive Order 13771 directs agencies to reduce regulation and
                control regulatory costs and provides that for every new regulation
                issued, at least two prior regulations be identified for elimination,
                and that the cost of planned regulations be prudently managed and
                controlled through a budgeting process. This rule is not an Executive
                Order 13771 regulatory action because this rule is not significant
                under Executive Order 12866.
                List of Subjects in 7 CFR Part 1486
                 Agricultural commodities, Exports.
                0
                For the reasons discussed in the preamble, 7 CFR part 1486 is revised
                to read as follows:
                PART 1486--EMERGING MARKETS PROGRAM
                Sec.
                Subpart A--General Information
                1486.100 General purpose and scope.
                1486.101 Definitions.
                1486.102 Regional projects.
                Subpart B--Eligibility, Applications, and Funding
                1486.200 Participation eligibility.
                1486.201 Eligible commodities.
                1486.202 Application process.
                1486.203 Application review and formation of agreements.
                1486.204 Funding limits.
                Subpart C--Program Operations
                1486.300 Applicant notification.
                1486.301 Amendments.
                1486.302 Subrecipients.
                Subpart D--Cost Share and Reimbursements
                1486.400 Cost share.
                1486.401 Eligible cost share.
                1486.402 Ineligible cost share.
                1486.403 Reimbursement rules.
                1486.404 Ineligible expenditures.
                1486.405 Reimbursement procedures.
                1486.406 Advances.
                Subpart E--Reporting, Evaluation, and Compliance
                1486.500 Reports.
                1486.501 Evaluation.
                1486.502 Compliance reviews and notices.
                1486.503 Records retention.
                1486.504 Program income.
                1486.505 Audit requirements.
                1486.506 Disclosure of program information.
                1486.507 Ethical conduct.
                1486.508 Suspension and termination.
                1486.509 Noncompliance with an agreement.
                1486.510 Paperwork reduction requirements.
                 Authority: 7 U.S.C. 5623, 5662-5663.
                Subpart A--General Information
                Sec. 1486.100 General purpose and scope.
                 (a) The E (Kika) de la Garza Emerging Markets Program (EMP) is
                established to develop, maintain, or expand markets for exports of
                United States agricultural commodities and to promote cooperation and
                exchange of information between agricultural institutions and
                agribusinesses in the United States and emerging markets. While the
                program is primarily intended to support the export market development
                efforts of the private sector, the program's resources may also be used
                to assist public agricultural organizations.
                 (b) This part sets forth the general terms, conditions, and
                policies governing the Commodity Credit Corporation's (CCC) operation
                of the EMP.
                 (c)(1) The Office of Management and Budget (OMB) issued guidance on
                Uniform Administrative Requirements, Cost Principles, and Audit
                Requirements for Federal Awards in 2 CFR part 200. In 2 CFR 400.1, the
                U.S. Department of Agriculture (USDA) adopted OMB's guidance in
                subparts A through F of 2 CFR part 200, as supplemented by 2 CFR part
                400, as USDA policies and procedures for uniform administrative
                requirements, cost principles, and audit requirements for Federal
                awards.
                 (2) The OMB guidance at 2 CFR part 200, as supplemented by 2 CFR
                part 400 and this part, applies to the EMP.
                 (3) In addition to the provisions of this part, other regulations
                that are generally applicable to grants and cooperative agreements of
                USDA, including the applicable regulations set forth in 2 CFR chapters
                I, II, IV, also apply to the EMP, to the extent that these regulations
                do not directly conflict with the provisions of this part. The
                provisions of the CCC Charter Act (15 U.S.C. 714 et seq.) and any other
                statutory or regulatory provisions that are generally applicable to CCC
                also apply to the EMP.
                 (d) Under the EMP, CCC provides grants to eligible U.S. private or
                government entities who demonstrate a role or interest in the export of
                U.S. agricultural commodities to conduct assessments of food and rural
                business system needs of emerging markets, make recommendations on
                measures necessary to enhance the effectiveness of such systems,
                including potential reductions in trade barriers, and identify and
                carry out specific opportunities and projects to enhance the
                effectiveness of such systems. The EMP may only be used to support
                exports of U.S. agricultural commodities through generic activities.
                 (e) Only initiatives that support the export of U.S. agricultural
                commodities are eligible for assistance under the program. The
                program's resources may not be used to support the export of another
                country's products to the United States or another country, or to
                promote the development of a foreign economy as a primary objective.
                 (f) The EMP generally operates on a reimbursement basis. The
                program is administered by the Foreign Agricultural Service (FAS)
                acting on behalf of CCC.
                 (g) EMP recipients are responsible for complying with all
                applicable laws and regulations.
                Sec. 1486.101 Definitions.
                 For purposes of this part, the following definitions apply:
                 Activities means components of a project that carries out one or
                more statutorily-authorized activities, e.g., activities that assess
                the food and rural business system needs of emerging markets; promote
                information exchange with such markets; and/or carry out
                recommendations, projects, and opportunities in emerging markets to
                enhance the effectiveness of such systems.
                 Agreement means a legally binding grant entered into between CCC
                and an EMP applicant setting forth the terms and conditions of approved
                activities under the EMP, including any subsequent amendments to such
                agreement.
                 Approval letter means a document by which CCC informs an applicant
                that its EMP proposal has been approved for funding. This letter may
                also approve specific activities and contain terms and conditions in
                addition to the agreement.
                 Attach[eacute]/Counselor means the FAS employee representing United
                States Department of Agriculture interests in a foreign country.
                 Cost share means the portion of project costs not paid by Federal
                funds (unless otherwise authorized by Federal statute). In terms of the
                EMP program, cost share is the funds provided by the Recipient, the
                U.S. industry, or a State agency in support of an approved activity.
                 Emerging market means generally any country, foreign territory,
                customs union, or other economic market that CCC determines is taking
                steps toward a market-oriented economy through its food, agriculture,
                or rural business sectors of the economy and has the potential to
                provide a viable and significant market for U.S. agricultural
                commodities. CCC has determined that
                [[Page 69987]]
                any country that is not designated as a high-income country by the
                World Bank is an eligible emerging market under this program. The World
                Bank periodically redefines the income limits for its country
                classification. Consequently, the list of ``emerging market'' countries
                may change over time. CCC will provide guidance on country eligibility
                in each program announcement.
                 Generic activities mean an activity that does not involve or
                promote the exclusive or predominant use of an individual company name,
                logo, or brand name, or the brand of a U.S. agricultural cooperative,
                but rather promotes a U.S. agricultural commodity generally.
                 Project means an approach or undertaking made up of one or more
                activities that, taken together, carries out one or more statutorily-
                authorized activities under the EMP (e.g., activities that assess the
                food and rural business system needs of emerging markets and develop
                recommendations on measures necessary to enhance the effectiveness of
                such systems; promote information exchange with such markets; or
                identify and carry out specific recommendations, opportunities, or
                projects to enhance the effectiveness of such systems).
                 Project funds means the funds made available to a Recipient by CCC
                under an agreement and authorized for expenditure in accordance with
                this part.
                 Proposal means an application for funding.
                 Recipient means a U.S. entity receiving financial assistance from
                CCC to carry out a project under the EMP.
                 SRTG is the acronym for State Regional Trade Group. An STRG is a
                non-profit association of state-funded agricultural promotion agencies.
                 STRE is the acronym for sales and trade relations expenditures.
                Expenditures made on breakfast, lunch, dinner, receptions, and
                refreshments at approved activities; miscellaneous courtesies such as
                checkroom fees, taxi fares and tips for approved activities; and
                decorations for a special promotional occasion that is part of an
                approved activity.
                 Unified Export Strategy (UES) system means an online internet
                system maintained by FAS through which applicants may apply to the EMP
                and other FAS market development programs. The system is currently
                accessible at https://apps.fas.usda.gov/ues/webapp/. FAS may prescribe
                a different system through which applicants may apply to EMP and will
                announce such system in the applicable Notice of Funding Opportunity
                (NOFO).
                 U.S. agricultural commodity means any agricultural commodity of
                U.S. origin, including food, feed, fiber, forestry product, livestock,
                insects, and fish harvested from a U.S. aquaculture farm or harvested
                by a vessel (as defined in Title 46 of the United States Code) in
                waters that are not waters (including the territorial sea) of a foreign
                country, and any product thereof.
                Sec. 1486.102 Regional projects.
                 Projects that focus on regions, such as the Caribbean Basin, rather
                than individual countries are eligible for consideration provided such
                projects target qualifying emerging markets in the specified region.
                CCC may also consider activities that target qualified emerging markets
                in a specific region but are conducted in a non-emerging market because
                of its importance as a central location and ease of access to that
                region.
                Subpart B--Eligibility, Applications, and Funding
                Sec. 1486.200 Participation eligibility.
                 (a) To participate in the EMP, U.S. private or government entities
                must demonstrate a role or interest in the exports of U.S. agricultural
                commodities. Government organizations consist of Federal, state, and
                local agencies. Private entities include non-profit trade associations,
                universities, agricultural cooperatives, SRTGs, consulting businesses,
                research institutions, and profit-making entities. Foreign
                organizations, whether government or private, may participate as
                subrecipients in activities carried out by U.S. entities, but are not
                eligible for direct funding assistance from the program.
                 (b) Proposals from research and consulting entities will be
                considered for funding assistance only with evidence of substantial
                participation in and financial support to the proposed project by U.S.
                industry. Such support is most credibly demonstrated through actual
                monetary contributions to the cost of the project.
                 (c) For-profit entities shall not use program funds to conduct
                private business, promote private self-interests, or promote their own
                products or services beyond specific uses approved in a given project.
                For-profit entities shall not use program funds to supplement the costs
                of normal day-to-day operations.
                Sec. 1486.201 Eligible commodities.
                 Any agricultural commodity or product thereof, excluding tobacco,
                that is comprised of at least 50 percent by weight, exclusive of added
                water, of agricultural commodities grown or raised in the United States
                is eligible for funding. Projects that seek support for multiple
                commodities are also eligible.
                Sec. 1486.202 Application process.
                 (a) Announcement of accepting EMP applicants. CCC will periodically
                announce that it is accepting applications for participation in the
                EMP. All relevant information, including application deadlines and
                proposal content, will be noted in the announcement, and proposals must
                be submitted in accordance with the terms and requirements specified in
                the announcement and in this part. Currently, applicants are encouraged
                to submit applications through the UES system but are not required to
                do so. CCC may request any additional information it deems necessary
                from any applicant in order to properly evaluate any proposal.
                 (b) Universal identifier and System for Award Management (SAM). In
                accordance with 2 CFR part 25, each entity that applies to the EMP and
                does not qualify for an exemption under 2 CFR 25.110 must:
                 (1) Be registered in the SAM prior to submitting an application or
                plan;
                 (2) Maintain an active SAM registration with current information at
                all times during which it has an active Federal award or an application
                or plan under consideration by CCC; and
                 (3) Provide its DUNS number, or a unique identifier designated as a
                DUNS replacement, in each application or plan it submits to CCC.
                 (c) Reporting subaward and executive compensation information. In
                accordance with 2 CFR part 170, each entity that applies to the EMP and
                does not qualify for an exception under 2 CFR 170.110(b) must ensure it
                has the necessary processes and systems in place to comply with the
                applicable reporting requirements of 2 CFR part 170 should it receive
                EMP funding.
                Sec. 1486.203 Application review and formation of agreements.
                 (a) General. Proposals received in accordance with the announcement
                and this part will undergo a multi-phase review by CCC to determine
                eligibility for the program, the qualifications, quality, and
                appropriateness of proposed projects, and the reasonableness of
                proposed project budgets.
                 (b) Evaluation criteria. CCC will review all proposals for
                eligibility and completeness. CCC will evaluate and score each proposal
                against the factors
                [[Page 69988]]
                described in the NOFO. All proposals that meet the eligibility and
                completeness criteria described in the NOFO and receive a passing score
                will be recommended for funding to the FAS Administrator. The purpose
                of this review is to identify meritorious proposals, recommend an
                appropriate funding level for each proposal, and submit the proposals
                and funding recommendations to appropriate officials for decision. CCC
                may, when appropriate to the subject matter of the proposal, request
                the assistance of other U.S. Government experts in evaluating the
                merits of a proposal. Demonstration of substantial U.S. industry
                participation in or financial or other support of a proposal will be a
                positive factor in the consideration of proposals. The degree of
                commitment to a proposed project, represented by the amount and type of
                cost share, is used in determining which proposals will be approved.
                Proposals in which the private sector is willing to commit funds,
                rather than in-kind items such as staff resources, and those with
                higher amounts of cost share will be given priority consideration. All
                reviewers will be required to sign a conflict of interest form, and
                when conflicts of interests are identified the reviewer will be recused
                from the objective review process.
                 (c) Approval decision. CCC will approve those applications that it
                determines best satisfy the criteria and factors specified in the
                announcement and this part. All decisions regarding the disposition of
                an application are final.
                Sec. 1486.204 Funding limits.
                 (a) The EMP is a relatively small program intended to develop,
                maintain, or expand access to qualified emerging markets. Its funds are
                intended for focused projects with specific activities, rather than
                expansive concept papers that contain only broad ideas. Large, overly
                expensive projects (i.e., in excess of $500,000) will not be funded.
                 (b) CCC will not reimburse 100 percent of the cost of any project
                undertaken by the private sector. The program is intended to provide
                appropriate assistance to projects that have significant financial
                contributions from other sources, especially U.S. private industry.
                 (c) Proposals for projects exceeding one year in duration may be
                considered, but proposals for projects that last longer than five years
                will not be considered. If approved, funding for multi-year projects
                may be provided one year at a time, with commitments beyond the first-
                year subject to interim evaluations intended to assess the progress of
                the project toward meeting its intended objectives.
                 (d) Funding for continuing and substantially similar projects is
                generally limited to three calendar years, although FAS will entertain
                requests to extend an agreement's expiration date up to a maximum of
                five calendar years. After that time, the project is assumed to have
                proven its viability and, if necessary, should be continued by the
                Recipient with its own or with alternative sources of funding.
                Recipients must submit in writing a valid justification for why an
                extension is necessary no later than 60 days before the end of the
                period of performance. If warranted, extensions generally will be
                granted in one-year increments. Recipients must wait for written
                approval from FAS before proceeding with the project.
                Subpart C--Program Operations
                Sec. 1486.300 Applicant notification.
                 (a) CCC will notify each applicant in writing of the final decision
                on its application. CCC will send an agreement and an approval letter
                to each approved applicant. An applicant that accepts the terms and
                conditions contained in the agreement must so indicate by having the
                appropriate authorizing official sign the agreement and return it to
                CCC. The applicant may not begin to implement approved activities until
                the applicant's authorizing official and CCC have signed the agreement.
                The applicant is authorized to begin implementation of the project as
                of the date specified in the approval letter, unless otherwise
                indicated.
                 (b) The approval letter and agreement will outline the activities
                and budgets that are approved and will specify the terms and conditions
                applicable to the project, including the levels of EMP funding and
                cost-share requirements.
                Sec. 1486.301 Amendments.
                 (a) Recipients may request to modify approved projects if
                circumstances change in such a way that they would likely affect the
                progress and ultimate success of a project. Such modification must be
                made through a written amendment to the agreement. All requests for
                project modifications must be made in writing to CCC and must include:
                 (1) A justification as to why changes to the project as originally
                designed are needed;
                 (2) An explanation of the necessary adjustments in approach or
                strategy; and
                 (3) A description of necessary changes in the project's time
                line(s) and/or budget (e.g., shifting of budgetary resources from one-
                line item to another in order to accommodate the changes).
                 (b) All requests for project modifications must be reviewed and
                approved by CCC. Upon approval, CCC will issue an amendment to the
                agreement, which must be signed by CCC and the Recipient.
                Sec. 1486.302 Subrecipients.
                 (a) A Recipient may utilize the services of a subrecipient to
                implement activities under the agreement if this is provided for in the
                agreement. The subrecipient may receive CCC-provided funds, program
                income, or other resources from the Recipient for this purpose. The
                Recipient must enter in to a written subaward with the subrecipient and
                comply with the applicable provisions of 2 CFR 200.331 and/or the
                Federal Acquisition Regulation (FAR), if applicable. If required by the
                agreement, the Recipient must provide a copy of such subaward to FAS,
                in the manner set forth in the agreement, prior to the transfer of CCC-
                provided funds or program income to the subrecipient.
                 (b) A Recipient must include the following requirements in a
                subaward:
                 (1) The subrecipient is required to comply with the applicable
                provisions of this part and 2 CFR parts 200 and 400 and/or the FAR, if
                applicable. The applicable provisions are those that relate
                specifically to subrecipients, as well as those relating to non-Federal
                entities that impose requirements that would be reasonable to pass
                through to a subrecipient because they directly concern the
                implementation by the subrecipient of one or more activities under the
                agreement. If there is a question about whether a particular provision
                is applicable, FAS will make the determination.
                 (2) The subrecipient must pay to the Recipient the value of CCC-
                provided funds, interest, or program income that are not used in
                accordance with the subaward, or that are lost, damaged, or misused as
                a result of the subrecipient's failure to exercise reasonable care.
                 (3) In accordance with 2 CFR 200.501(h), subawards must include a
                description of the applicable compliance requirements and the
                subrecipient's compliance responsibility. Methods to ensure compliance
                may include pre-award audits, monitoring during the agreement, and
                post-award audits.
                 (c) A Recipient must monitor the actions of a subrecipient as
                necessary to ensure that CCC-provided funds and
                [[Page 69989]]
                program income provided to the subrecipient are used for authorized
                purposes in compliance with applicable U.S. Federal laws and
                regulations and the subaward and that performance indicator targets are
                achieved for both activities and results under the agreement.
                 (d) Recipients have full and sole responsibility for the legal
                sufficiency of all subawards they may enter into with one or more
                subrecipients in order to carry out an approved project and shall
                assume financial liability for any costs or claims resulting from
                suits, challenges, or other disputes based on subawards entered into by
                the Recipient. Neither CCC nor any other agency of the United States
                Government nor any official or employee of CCC, FAS, USDA, or the
                United States Government has any obligation or responsibility with
                respect to Recipient subawards with third parties.
                 (e) Recipients are responsible for ensuring to the greatest extent
                possible that the terms, conditions, and costs of subawards constitute
                the most economical and effective use of project funds.
                 (f) All fees for professional and technical services paid to
                subrecipients in any part with project funds must be covered by written
                subawards.
                 (g) A Recipient shall:
                 (1) Ensure that all expenditures for goods and services in excess
                of $25 reimbursed by CCC are documented by a purchase order or invoice;
                 (2) Ensure that no employee, officer, board member, agent, or the
                employee's, officer's, board member's, or agent's family, partners, or
                an organization that employs or is about to employ any of the parties
                indicated herein, participates in the review, selection, award or
                administration of a subaward in which such entities or their affiliates
                have a financial or other interest;
                 (3) Conduct all contracting in an openly competitive manner.
                Individuals who develop or draft specifications, requirements,
                statements of work, invitations for bids, or requests for proposals for
                procurement of any goods or services, and such individuals' families or
                partners, or an organization that employs or is about to employ any of
                the aforementioned shall be excluded from competition for such
                procurement;
                 (4) Conduct all awarding of grants and agreements in an openly
                competitive manner, except under the following conditions:
                 (i) Non-monetary awards of property or services;
                 (ii) Awards of less than $75,000;
                 (iii) Awards to fund continuing work already started under a
                previous award;
                 (iv) Awards that cannot be delayed due to an emergency or a
                substantial danger to health or safety;
                 (v) Awards when it is impracticable to secure competition; or
                 (vi) Awards to fund unique and innovative unsolicited applications;
                 (5) Base each solicitation for professional or technical services
                on a clear and accurate description of and requirements related to the
                services to be procured;
                 (6) Perform and document some form of fee, price, or cost analysis,
                such as a comparison of price quotations to market prices or other
                price indicia, to determine the reasonableness of the offered fees or
                prices for procurements in excess of the simplified acquisition
                threshold defined at 2 CFR 200.88; and
                 (7) Document the decision-making process.
                Subpart D--Cost Share and Reimbursements
                Sec. 1486.400 Cost share.
                 (a) The EMP is intended to complement, not supplant, the efforts of
                the U.S. private sector. Therefore, no private sector proposal will be
                considered without the element of cost share from the Recipient and/or
                U.S. partners.
                 (b) There is no minimum or maximum required amount of cost share.
                The degree of commitment to a proposed project, represented by the
                amount and type of private funding, is used as one factor in
                determining which proposals will be approved. The type of cost share is
                also not specified, though some contributions are ineligible (see Sec.
                1486.402). Cost share may be actual cash invested or professional time
                of staff assigned to the project. Proposals in which the private sector
                is willing to commit funds, rather than in-kind items such as staff
                resources, and those with higher amounts of cost share will be given
                priority consideration.
                 (c) Cost share is not required for proposals from Federal, state,
                or local government agencies. It is mandatory from all other eligible
                entities, even when they are party to a joint proposal with a
                government agency.
                 (d) Contributions from foreign (non-U.S.) organizations may not be
                counted toward the cost share requirement but may be included in the
                total cost of the project.
                 (e) An activity that is undertaken by an entity at the request of
                FAS may be exempted from the cost share requirement. This determination
                is made at the discretion of FAS.
                 (f) A Recipient's cost share requirement will be specified in the
                agreement and approval letter. If a Recipient fails to contribute the
                total specified in the agreement, the difference between the amount
                contributed and the total amount required must be repaid to CCC in U.S.
                dollars within six months after the end of the period of performance of
                the agreement. If a Recipient is reimbursed by CCC for less than the
                amount of funds approved in the agreement, then the final required cost
                share shall equal, on a percentage basis, the original ratio of cost
                share to the authorized EMP funding level.
                Sec. 1486.401 Eligible cost share.
                 (a) In calculating the amount of cost share that it will make and
                the cost share U.S. entities or a State or local agency will make, a
                Recipient may include those costs (or such prorated costs) not
                proscribed under Sec. 1486.402 if:
                 (1) The expenditures are necessary and reasonable for
                accomplishment of the Recipient's overall EMP;
                 (2) The expenditures are not included as cost share for any other
                Federal award;
                 (3) The expenditures are not paid by the Federal Government under
                another Federal award, except where the Federal statute authorizing a
                program specifically provides that Federal funds made available for
                such program can be applied to matching or cost sharing requirements of
                other Federal programs; and
                 (4) The cost share is made during the period covered by the
                agreement.
                 (b) Cost share must be included in a project's line item budget.
                Sec. 1486.402 Ineligible cost share.
                 (a) The following are not eligible as cost share:
                 (1) Normal operating expenses and other costs not directly related
                to the project;
                 (2) Any portion of salary or compensation of an individual who is
                the target of an approved project activity;
                 (3) The cost of insuring articles owned by private individuals;
                 (4) The cost of product development, product modification, or
                product research;
                 (5) Slotting fees or similar sales expenditures;
                 (6) Funds, services, capital goods, or personnel provided by any
                U.S. Government agency;
                 (7) The value of any services generated by a Recipient or a third
                party that involve no expenditure by the Recipient or third party,
                e.g., free publicity;
                [[Page 69990]]
                 (8) The cost of developing any application/proposal for EMP
                funding;
                 (9) Membership fees in clubs and social organizations; and
                 (10) Any expenditure for an activity prior to CCC's approval of
                that activity.
                 (b) CCC shall determine, at CCC's discretion, whether any cost not
                expressly listed in this section may be included as an eligible cost
                share.
                Sec. 1486.403 Reimbursement rules.
                 (a) A Recipient may seek reimbursement for an eligible expenditure
                if:
                 (1) The expenditure was necessary and reasonable for the
                performance of an approved activity; and
                 (2) The Recipient has not been and will not be reimbursed for such
                expenditure by any other source.
                 (b) Subject to paragraph (a) of this section, as well as applicable
                cost principles in 2 CFR part 200, to the extent these principles do
                not directly conflict with the provisions of this part, CCC will
                reimburse, in whole or in part, the cost of:
                 (1) Salaries and benefits of the Recipient's existing personnel or
                any other participating entity that are directly assigned to EMP-funded
                projects. Salaries of administrative and clerical staff should normally
                be treated as indirect costs. Federal, state, and local government
                Recipients may not be reimbursed for salaries and benefits.
                Reimbursement of salaries and benefits for other Recipients is limited
                to:
                 (i) The actual daily rate paid by the Recipient for the employee's
                salary or the daily rate of a GS-15, Step 10 U.S. Government employee
                in effect during the calendar year in which the project or activity is
                approved for funding, whichever is less;
                 (ii) The actual assigned time of the employee to the project; and
                 (iii) Benefits at a maximum rate of 30 percent of the existing
                salary of the employee, prorated to the time assigned to the project,
                provided that such benefits are required and granted pursuant to the
                Recipient's established written policies.
                 (2) Consulting fees for professional services, limited to the daily
                rate of a GS-15, Step 10 U.S. Government employee in effect during the
                calendar year in which the project or activity is approved for funding.
                Reimbursement is authorized only for actual days worked and is not
                authorized for travel and rest days. Benefits are not reimbursable.
                 (3) STRE for social events or receptions that are primarily
                attended by foreign officials and that are held at foreign venues and
                are part of an approved activity. Such expenses must conform to the
                American Embassy representational funding guidelines as the standard
                for judging the appropriateness of the STRE costs. The amount of
                unauthorized STRE expenses that exceed the guidelines will not be
                reimbursed. Recipients must pay the difference between the total cost
                of STRE events and the appropriate amount as determined by the
                guidelines. STRE incurred in the United States is not authorized for
                reimbursement but may be counted as a cost share to the project.
                 (4) Travel expenses, subject to the following:
                 (i) All expenses while in travel status must conform to the U.S.
                Federal Travel Regulations (41 CFR parts 300 through 304);
                 (ii) Air travel must comply with the Fly America Act (49 U.S.C.
                App. 1517) and is limited to the full-fare economy class rate;
                 (iii) Per diem is limited to the allowable rate for each domestic
                or foreign locale (41 CFR part 301-11). Expenses in excess of the
                authorized per diem rates may be allowed in special or unusual
                circumstances (41 CFR part 301-11), but must be approved in advance;
                and
                 (iv) The Recipient shall notify the Attach[eacute]/Counselor in the
                destination countries in writing in advance of any proposed travel by
                the Recipient or its consultants or other Recipients. The timing of
                such notice should be far enough in advance to enable the
                Attach[eacute]/Counselor to schedule appointments, make preparations,
                or otherwise provide any assistance being requested. Failure to provide
                advance notification of travel generally will result in disallowance of
                the expenses related to the travel, unless CCC determines it was
                impractical to provide such notification.
                 (5) Direct administrative costs.
                 (6) Indirect costs not identified as direct costs, but which are
                necessary for the implementation of a project. Indirect costs must be
                specified to be eligible for reimbursement. Indirect costs may be
                reimbursed up to a maximum of 10 percent of the EMP-funded portion of
                the project budget, excluding indirect costs, except that Recipients in
                FAS' Market Access Program and the Foreign Market Development
                Cooperator Program, SRTGs, for-profit entities, and government
                Recipients may not be reimbursed for indirect costs.
                 (7) Rental costs for equipment necessary to carry out approved
                projects. Equipment rentals must be returned by the Recipient to the
                supplier in accordance with the lease agreements, but in no case later
                than 90 calendar days from the completion date of the project.
                 (8) Procuring samples of specific agricultural commodities that are
                appropriate and necessary to the success of a technical assistance
                activity.
                Sec. 1486.404 Ineligible expenditures.
                 (a) CCC will not reimburse expenditures made prior to approval of a
                Recipient's proposal, unreasonable expenditures, or any cost of:
                 (1) Branded product promotions, e.g., in-store promotions,
                restaurant advertising, labeling, etc.;
                 (2) Administrative and operational expenses for trade shows;
                 (3) Advertising;
                 (4) Preparation and printing of magazines, brochures, flyers,
                posters, etc., except in connection with specific approved activities
                such as training;
                 (5) Design, development, and maintenance of information technology
                projects;
                 (6) Purchase of equipment, e.g., office equipment or other fixed
                assets;
                 (7) Subsidizing or otherwise providing funds for graduate programs
                at colleges and/or universities (salaries or fees for individual
                students who are directly assigned to specific project activities
                appropriate to their backgrounds may be covered on a pro-rated basis);
                 (8) Subsidizing normal, day-to-day operating costs of an entity,
                except as allowed under Sec. 1486.403(b)(6);
                 (9) Honoraria for speakers;
                 (10) Costs of product research or new product development;
                 (11) Costs of developing technical assistance proposals submitted
                to the program;
                 (12) Refundable deposits or advances;
                 (13) STRE expenses within the United States;
                 (14) All costs related to the shipping, over land and sea, of
                commodity samples;
                 (15) Expenses, fines, settlements, judgments, or payments relating
                to legal suits, challenges, or disputes, including legal fees and costs
                associated with trade disputes, except as otherwise allowed in 2 CFR
                part 200;
                 (16) Real estate costs other than allowable rental costs for office
                space whose use is assigned specifically to a project funded by the
                EMP; and
                 (17) Any expenditure that has been or will be reimbursed by any
                other source.
                 (b) CCC may determine, at CCC's discretion, whether any cost not
                expressly listed in this section will be reimbursed.
                Sec. 1486.405 Reimbursement procedures.
                 (a) Following the implementation of a project for which CCC has
                agreed to
                [[Page 69991]]
                provide funding, a Recipient may submit claims for reimbursement of
                eligible expenses incurred in implementing an EMP project, to the
                extent that CCC has agreed to pay such expenses. Any changes to
                approved activities must be approved in writing by CCC before any
                reimbursable expenses associated with the change can be incurred. A
                Recipient will be reimbursed after CCC reviews the claim and determines
                that it is complete.
                 (b) CCC will make all payments to the Recipients in U.S. dollars.
                FAS will initiate payment within 30 days after receipt of the billing,
                unless the billing is improper.
                 (c) Recipients will be authorized to submit requests for
                reimbursements or advances at least monthly when electronic fund
                transfers (EFTs) are not used, and as frequently as desired when
                electronic transfers are used, in accordance with the provisions of the
                Electronic Fund Transfer Act (15 U.S.C. 1693-1693r).
                 (d) Recipients may submit claims for reimbursement of the expenses
                incurred in implementing EMP projects, to the extent CCC has agreed to
                pay for such costs, limited initially to 85 percent of the total amount
                specified in the agreement. The Recipient may be reimbursed for the
                remaining 15 percent of the funds only after the final performance
                report containing the information required by the agreement is
                submitted to and approved by FAS.
                 (e) Final claims for reimbursement must be received no later than
                90 calendar days after the completion date of the project or following
                the expiration or termination date of the agreement, whichever is
                sooner, and are subject to FAS approval of the Recipient's final
                performance report. Recipients are required to use a prescribed system
                to submit their claims. This system will be clearly stated in the NOFO.
                Currently the CCC's internet-based UES system is being used to request
                reimbursement for eligible EMP program expenses.
                 (f) Recipients shall maintain complete records of all program
                expenditures, identified by EMP agreement number, program year, country
                or region, activity number, and cost category. Such records shall be
                accompanied by documentation that supports the expenditure and shall be
                made available to CCC upon request. CCC may deny a claim for
                reimbursement if the claim is not supported by acceptable
                documentation.
                 (g) In the event that a reimbursement claim is overpaid or is
                disallowed after payment already has been made, the Recipient shall
                repay CCC within 30 calendar days of such overpayment or disallowance
                the amount overpaid or disallowed either by submitting a check payable
                to CCC and referencing the applicable project, or by offsetting its
                next reimbursement claim. The Recipient shall make such payment in U.S.
                dollars, unless otherwise approved in advance by CCC.
                 (h) The Recipient shall report any actions that may have a bearing
                on the propriety of any claims for reimbursement in writing to the
                appropriate Attach[eacute]/Counselor and FAS Division Director.
                Sec. 1486.406 Advances.
                 (a) Policy. In general, CCC operates the EMP on a cost reimbursable
                basis.
                 (b) Exception. Upon request, CCC may make advance payments to a
                Recipient against an approved project budget. Up to 40 percent of the
                approved project budget may be provided as an advance, either at one
                time or in incremental payments. Advances should be limited to the
                minimum amounts needed and requested as close as is administratively
                feasible to the actual time of disbursement by the Recipient.
                Reimbursement claims will be used to offset advances. Recipients shall
                deposit and maintain advances in insured, interest-bearing accounts,
                unless the exceptions in 2 CFR part 200 apply. Interest earned by the
                Recipient on funds advanced by CCC is not program income. Up to $500 of
                interest earned per year may be retained by the Recipient for
                administrative expenses. Any additional interest earned on Federal
                advance payments shall be remitted annually to the appropriate entity
                as required in 2 CFR part 200.
                 (c) Refunds due CCC. A Recipient shall fully expend all advances on
                approved activities within 90 calendar days after the date of
                disbursement by CCC. By the end of 90 calendar days, the Recipient must
                submit reimbursement claims to offset the advance and submit a check
                made payable to CCC for any unexpended balance. The Recipient shall
                make such payment in U.S. dollars, unless otherwise approved in advance
                by CCC.
                Subpart E--Reporting, Evaluation, and Compliance
                Sec. 1486.500 Reports.
                 (a) Recipients are required to submit regular financial and
                performance reports in accordance with their agreement. Reporting
                requirements and formats for both annual financial and performance
                reports and final financial and performance reports will be specified
                in the agreement between CCC and the Recipient.
                 (b)(1) In addition to the information required in 2 CFR
                200.328(b)(2), a Recipient's performance reports must include pertinent
                information regarding the Recipient's progress, measured against
                established indicators, baselines, and targets, towards achieving the
                expected results specified in the agreement. This reporting must
                include, for each performance indicator, a comparison of actual
                accomplishments with the baseline and the targets established for the
                period. When actual accomplishments deviate significantly from targeted
                goals, the Recipient must provide an explanation in the report.
                 (2) A Recipient must ensure the accuracy and reliability of the
                performance data submitted to FAS in performance reports. At any time
                during the period of performance of the agreement, FAS may review the
                Recipient's performance data to determine whether it is accurate and
                reliable. The Recipient must comply with all requests made by FAS or an
                entity designated by FAS in relation to such reviews.
                 (c) All final performance reports will be made available to the
                public.
                 (d) If requested by FAS, a Recipient must provide to FAS additional
                information or reports relating to the agreement.
                 (e) If a Recipient requires an extension of a reporting deadline,
                it must ensure that FAS receives an extension request at least five
                business days prior to the reporting deadline. FAS may decline to
                consider a request for an extension that it receives after this time
                period. FAS will consider requests for reporting deadline extensions on
                a case by case basis and will make a decision based on the merits of
                each request. FAS will consider factors such as unforeseen or
                extenuating circumstances and past performance history when evaluating
                requests for extensions.
                Sec. 1486.501 Evaluation.
                 Project evaluations may be carried out by CCC at its option with or
                without Recipients. CCC may also seek outside expertise to conduct or
                participate in evaluations.
                Sec. 1486.502 Compliance reviews and notices.
                 (a) Compliance review process. (1) USDA staff may conduct
                compliance reviews of Recipient's activities under the EMP to ensure
                compliance with this part, applicable Federal laws and regulations, and
                the terms of the agreements and approval letters. Recipients shall
                cooperate fully with relevant USDA staff conducting compliance reviews
                and shall comply
                [[Page 69992]]
                with all requests from USDA staff to facilitate the conduct of such
                reviews. Program funds spent inappropriately or on unapproved
                activities must be returned to CCC.
                 (2) Any project or activity funded under the program is subject to
                review or audit at any time during the course of implementation or
                after the completion of the project.
                 (3) Upon conclusion of the compliance review, USDA staff will
                provide a written compliance report to the Recipient. The compliance
                report will detail any instances where it appears that the Recipient is
                not complying with any of the terms or conditions of the agreement,
                approval letter, or the applicable laws and regulations. The report
                will also specify if it appears that CCC may be entitled to recover
                funds from the Recipient and will explain the basis for any recovery of
                funds from the Recipient. If, as a result of a compliance review, CCC
                determines that further review is needed in order to ensure compliance
                with the requirements of the EMP, CCC may require the Recipient to
                contract for an independent audit.
                 (4) In addition, CCC may notify a Recipient in writing at any time
                if CCC determines that CCC may be entitled to recover funds from the
                Recipient. CCC will explain the basis for any recovery of funds from
                the Recipient in the written notice. The Recipient shall, within 30
                calendar days of the date of the notice, repay CCC the amount owed
                either by submitting a check payable to CCC or by offsetting its next
                reimbursement claim. The Recipient shall make such payment in U.S.
                dollars, unless otherwise approved in advance by CCC. If, however, a
                Recipient notifies CCC within 30 calendar days of the date of the
                written notice that the Recipient intends to file an appeal pursuant to
                the provisions of this part, the amount owed to CCC by the Recipient is
                not due until the appeal procedures are concluded and CCC has made a
                final determination as to the amount owed.
                 (5) The fact that a compliance review has been conducted by USDA
                staff does not signify that a Recipient is in full compliance with its
                agreement, approval letter, and/or applicable laws and regulations.
                 (b) Recipient response to compliance report. (1) A Recipient shall,
                within 60 calendar days of the date of the issuance of a compliance
                report, submit a written response to CCC. The response may include
                additional documentation for consideration or a request for
                reconsideration of any finding along with supporting justification. If
                the Recipient does not wish to contest the compliance report, the
                response shall include any money owed to CCC, which may be returned by
                submitting a check payable to CCC or by offsetting a reimbursement
                claim. The Recipient shall make any payments in U.S. dollars, unless
                otherwise approved in advance by CCC. CCC, at its discretion, may
                extend the period for response.
                 (2) After reviewing the response, CCC shall determine whether the
                Recipient owes any funds to CCC and will inform the Recipient in
                writing of the basis for the determination. CCC may initiate action to
                collect such amount by providing the Recipient a written demand for
                payment of the debt pursuant to the debt settlement policies and
                procedures in 7 CFR part 1403.
                 (c) Recipient appeals of CCC determinations. (1) Within 30 calendar
                days of the date of the issuance of a determination, the Recipient may
                appeal the determination by making a request in writing that includes
                the basis for such reconsideration. The Recipient may also request a
                hearing.
                 (2) If the Recipient requests a hearing, CCC will set a date and
                time for the hearing. The hearing will be an informal proceeding. A
                transcript will not ordinarily be prepared unless the Recipient bears
                the cost of a transcript; however, CCC may, at its discretion, have a
                transcript prepared at CCC's expense.
                 (3) CCC will base its final determination upon information
                contained in the administrative record. The Recipient must exhaust all
                administrative remedies contained in this section before pursuing
                judicial review of a determination by CCC.
                Sec. 1486.503 Records retention.
                 Each Recipient shall retain all records relating to the project for
                three calendar years from the date of submission of the final
                expenditure report. All records related to the project, including
                records pertaining to contractors, shall be made available upon request
                to authorized officials of the U.S. Government.
                Sec. 1486.504 Program income.
                 Program income means gross income earned by the Recipient that is
                directly generated by a supported activity or earned as a result of the
                Federal award during the period of performance. Any such income
                generated from an activity, the expenditures for which have been wholly
                or partially reimbursed with EMP funds, shall be used by the Recipient
                in furtherance of its approved activities in the program period during
                which the EMP funds are available for obligation by the Recipient, or
                must be returned to CCC. The use of such income shall be governed by
                this part. Reasonable activity fees or registration fees, if identified
                as such in a project budget, may be charged for projects approved for
                program funding. The intent to charge a fee must be part of the
                original proposal, along with an explanation of how such fees are to be
                used. Any activity fees charged must be used to offset activity
                expenses or returned to CCC. Such fees may not be used as profit or
                counted as cost share.
                Sec. 1486.505 Audit requirements.
                 (a) Subpart F of 2 CFR part 200 applies to all Recipients and
                subrecipients under this part other than those that are for-profit
                entities, foreign public entities, or foreign organizations.
                 (b) A Recipient or subrecipient that is a for-profit entity or a
                subrecipient that is a foreign organization and that expends, during
                its fiscal year, a total of at least the audit requirement threshold in
                2 CFR 200.501 in Federal awards, is required to obtain an audit. Such a
                Recipient or subrecipient has the following two options to satisfy the
                requirement in this paragraph (b):
                 (1)(i) A financial audit of the agreement or subaward, in
                accordance with the Government Auditing Standards issued by the United
                States Government Accountability Office (GAO), if the Recipient or
                subrecipient expends Federal awards under only one FAS program during
                such fiscal year; or
                 (ii) A financial audit of all Federal awards from FAS, in
                accordance with GAO's Government Auditing Standards, if the Recipient
                or subrecipient expends Federal awards under multiple FAS programs
                during such fiscal year; or
                 (2) An audit that meets the requirements contained in subpart F of
                2 CFR part 200.
                 (c) A Recipient or subrecipient that is a for-profit entity or a
                subrecipient that is a foreign organization and that expends, during
                its fiscal year, a total that is less than the audit requirement
                threshold in 2 CFR 200.501 in Federal awards, is exempt from
                requirements under this section for an audit for that year, except as
                provided in paragraphs (d) and (f) of this section, but it must make
                records available for review by appropriate officials of Federal
                agencies.
                 (d) FAS may require an annual financial audit of an agreement or
                subaward when the audit requirement threshold in 2 CFR 200.501 is not
                met. In that case, FAS must provide funds under the agreement for this
                purpose, and the Recipient or subrecipient, as applicable, must arrange
                for such audit and submit it to FAS.
                [[Page 69993]]
                 (e) When a Recipient or subrecipient that is a for-profit entity or
                a subrecipient that is a foreign organization is required to obtain a
                financial audit under this section, it must provide a copy of the audit
                to FAS within 60 days after the end of its fiscal year.
                 (f) FAS, the USDA Office of Inspector General, or GAO may conduct
                or arrange for additional audits of any Recipients or subrecipients,
                including for-profit entities and foreign organizations. Recipients and
                subrecipients must promptly comply with all requests related to such
                audits. If FAS conducts or arranges for an additional audit, such as an
                audit with respect to a particular agreement, FAS will fund the full
                cost of such an audit, in accordance with 2 CFR 200.503(d).
                Sec. 1486.506 Disclosure of program information.
                 (a) Documents submitted to CCC by Recipients are subject to the
                provisions of the Freedom of Information Act (FOIA), 5 U.S.C. 552, and
                7 CFR part 1, subpart A, including, specifically, 7 CFR 1.11.
                 (b) Any research conducted by a Recipient pursuant to an agreement
                and/or approval letter shall be subject to the provisions relating to
                intangible property in 2 CFR part 200.
                Sec. 1486.507 Ethical conduct.
                 (a) The Recipient shall maintain written standards of conduct
                governing the performance of its employees engaged in the award and
                administration of contracts.
                 (b) A Recipient shall conduct its business in accordance with the
                laws and regulations of the country(s) in which each activity is
                carried out and in accordance with applicable U.S. Federal, state, and
                local laws and regulations. A Recipient shall conduct its business in
                the United States in accordance with applicable Federal, state, and
                local laws and regulations.
                 (c) Neither a Recipient nor its affiliates shall make export sales
                of U.S. agricultural commodities covered under the terms of an
                agreement. Neither a Recipient nor its affiliates shall charge a fee
                for facilitating an export sale. A Recipient may collect check-off
                funds and membership fees that are required for membership in the
                Recipient's organization.
                 (d) The Recipient shall not use program activities or project funds
                to promote private self-interests or conduct private business.
                 (e) A Recipient shall not limit participation in its EMP activities
                to members of its organization. Recipients shall ensure that their EMP-
                funded programs and activities are open to all otherwise qualified
                individuals and entities on an equal basis and without regard to any
                non-merit factors.
                 (f) A Recipient shall select U.S. agricultural industry
                representatives to participate in activities based on criteria that
                ensure participation on an equitable basis by a broad cross section of
                the U.S. industry. If requested by CCC, a Recipient shall submit such
                selection criteria to CCC for approval.
                 (g) The Recipient must report any actions or circumstances that may
                have a bearing on the propriety of program activities to the
                appropriate Attach[eacute]/Counselor, and the Recipient's U.S. office
                shall report such actions or circumstances in writing to CCC.
                 (h) The officers, employees, board members, and agents of the
                Recipient shall neither solicit nor accept gratuities, favors, or
                anything of monetary value from contractors, sub-contractors, or
                parties to sub-agreements. However, Recipients may set standards for
                situations in which the financial interest is not substantial, or the
                gift is an unsolicited item of nominal value. The standards of conduct
                shall provide for disciplinary actions to be applied for violations of
                such standards by officers, employees, board members, or agents of the
                Recipient.
                Sec. 1486.508 Suspension and termination.
                 (a) An agreement or subaward may be suspended or terminated in
                accordance with 2 CFR 200.338 or 200.339. FAS may suspend or terminate
                an agreement if it determines that:
                 (1) One of the bases in 2 CFR 200.338 or 200.339 for termination or
                suspension by FAS has been satisfied; or
                 (2) The continuation of the assistance provided under the agreement
                is no longer necessary or desirable.
                 (b) If an agreement is terminated, the Recipient:
                 (1) Is responsible for using or returning any CCC-provided funds,
                interest, or program income that have not been disbursed, as agreed to
                by FAS; and
                 (2) Must comply with any closeout and post-closeout procedures
                specified in the agreement and 2 CFR 200.343 and 200.344.
                Sec. 1486.509 Noncompliance with an agreement.
                 (a) If a Recipient fails to comply with any term in its agreement,
                approval letter, or this part, CCC may take one or more of the
                enforcement actions in 2 CFR part 200 and, if appropriate, initiate a
                claim against the Recipient, following the procedures set forth in this
                part. CCC may also initiate a claim against a Recipient if program
                income or CCC-provided funds are lost due to an action or omission of
                the Recipient. If any Recipient has engaged in fraud with respect to
                the EMP program, or has otherwise violated program requirements under
                this part, CCC may:
                 (1) Hold such Recipient liable for any and all losses to CCC
                resulting from such fraud or violation;
                 (2) Require a refund of any assistance provided to such Recipient
                plus interest as determined by FAS; and
                 (3) Collect liquidated damages from such Recipient in an amount
                determined appropriate by FAS.
                 (b) The provisions of this section shall be without prejudice to
                any other remedy that is available under any other provision of law.
                Sec. 1486.510 Paperwork reduction requirements.
                 The paperwork and recordkeeping requirements imposed by this part
                have been approved by OMB under the Paperwork Reduction Act of 1980.
                OMB has assigned control number 0551-0048 for this information
                collection.
                 Dated: November 27, 2019.
                Margo Erny,
                Acting Executive Vice President, Commodity Credit Corporation.
                 In concurrence with:
                 Dated: November 26, 2019.
                Ken Isley,
                Administrator, Foreign Agricultural Service.
                [FR Doc. 2019-27246 Filed 12-19-19; 8:45 am]
                BILLING CODE 3410-10-P
                

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