General Updates and Elimination of Certain TAAF and PWEDA Regulations
| Citation | 85 FR 8373 |
| Record Number | 2020-00453 |
| Published date | 14 February 2020 |
| Section | Rules and Regulations |
| Court | Economic Development Administration |
Federal Register, Volume 85 Issue 31 (Friday, February 14, 2020)
[Federal Register Volume 85, Number 31 (Friday, February 14, 2020)]
[Rules and Regulations]
[Pages 8373-8383]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-00453]
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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.
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Federal Register / Vol. 85, No. 31 / Friday, February 14, 2020 /
Rules and Regulations
[[Page 8373]]
DEPARTMENT OF COMMERCE
Economic Development Administration
13 CFR Parts 302 and 315
[Docket No.: 191218-0119]
RIN 0610-AA80
General Updates and Elimination of Certain TAAF and PWEDA
Regulations
AGENCY: Economic Development Administration, U.S. Department of
Commerce.
ACTION: Final rule.
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SUMMARY: The Economic Development Administration (``EDA''), U.S.
Department of Commerce (``DOC''), is issuing a final rule to update the
agency's regulations implementing the Trade Adjustment Assistance for
Firms (``TAAF'') provisions of the Trade Act of 1974, as amended
(``Trade Act''), and the Public Works and Economic Development Act of
1965, as amended (``PWEDA''). The changes to the TAAF program
regulations clarify the process for import-impacted U.S. manufacturing
firms, oil and natural gas production firms, and service firms to
obtain technical assistance--identified in the Trade Act as
``adjustment assistance''--through the TAAF program, reorganize the
regulations to make them easier to read and understand, incorporate
best practices, and bring the regulations into closer alignment with
the program's statutory requirements. The result will be to ease the
burden on firms seeking adjustment assistance through the TAAF program
and make it easier for Trade Adjustment Assistance Centers (``TAACs'')
to work with firms. EDA is also eliminating certain TAAF and PWEDA
regulations that are unnecessary or duplicative because they describe
requirements already established in other regulations or award
documentation.
DATES: This final rule is effective on March 16, 2020.
ADDRESSES: EDA received no comments on the notice of proposed
rulemaking (``NPRM'') that preceded this final rule, so there are no
comments for EDA to post to the Federal Rulemaking Portal,
www.regulations.gov. For convenience, after the final rule becomes
effective, EDA plans to update the full text of EDA's regulations, as
amended, and post it on EDA's website at https://www.eda.gov/about/regulations.htm.
FOR FURTHER INFORMATION CONTACT: Ryan Servais, Attorney Advisor, Office
of the Chief Counsel, Economic Development Administration, U.S.
Department of Commerce, 1244 Speer Boulevard, Suite 431, Denver, CO
80204; telephone: (303) 844-4403.
SUPPLEMENTARY INFORMATION:
Background
Through strategic grant investments that foster job creation and
attract private investment, EDA supports development in economically
distressed areas of the United States to prepare these areas for growth
and success in the worldwide economy.
EDA is issuing this final rule to update the agency's regulations
implementing the TAAF program (Part I) and PWEDA (Part II). The changes
will ease the burden on firms and grantees by eliminating unnecessary
and duplicative regulations and clarifying and reorganizing the
regulations to make them easier to understand.
The updates will also incorporate best practices. For example, EDA
is adding a requirement that firms must begin implementation of their
Adjustment Proposal (``AP'') within six months after the AP is approved
by EDA. Firms that do not begin implementation within six months after
approval must update and re-submit their AP, and then request re-
approval before any Adjustment Assistance may be provided. EDA is also
incorporating changes that will enable firms to amend their APs within
two years of EDA approval and that will require firms to complete
implementation of the APs within five years of approval. These are
existing best practices and help to ensure that APs reflect current
conditions and are maximally effective.
The updates will align the regulations more closely with statutory
requirements. Specifically, EDA refers to imported articles or services
that compete with and are substantially equivalent to the petitioning
firm's as ``directly competitive or like,'' as written in the Trade
Act, rather than simply ``directly competitive.'' In addition, EDA is
clarifying all references to ``days'' as ``calendar days,'' to reflect
this usage in the Trade Act, a change that will also speed up the time
within which EDA is required to make determinations regarding firm
eligibility and assistance.
On August 19, 2019, EDA published an NPRM in the Federal Register
requesting public comments on the general updates and elimination of
certain TAAF and PWEDA regulations contained in this final rule (84 FR
42831). The public comment period closed on September 18, 2019. EDA
received no comments in response to the NPRM. For this reason, this
final rule contains no changes to the rulemaking that was proposed in
the NPRM, apart from two technical corrections. The first technical
correction changes several instances of ``Adjustment Plan'' to
``Adjustment Proposal.'' ``Adjustment Plan'' is not a defined term;
``Adjustment Proposal'' is the correct term that should be used
throughout. The second technical correction, to revised 13 CFR 315.15,
eliminates an improper citation to the Tariff Act and is discussed
below in Part I.
Lastly, because this rule will remove certain regulations and will
make it easier for firms and EDA grantees to comply with the
requirements for the TAAF and EDA grant programs, it is considered a
``deregulatory action'' pursuant to the April 5, 2017, OMB guidance
memorandum implementing Executive Order 13771 (M-17-21).
Part I: Updates to TAAF Program Regulations
Trade Act Background
Authorized under chapter 3 of title II of the Trade Act of 1974 (19
U.S.C. 2341-2355), the TAAF program assists import-impacted U.S.
manufacturing firms, oil and natural gas production firms, and service
firms with developing and implementing projects to regain global
competitiveness, expand markets, strengthen operations, and increase
profitability, thereby increasing U.S. jobs.
The TAAF program provides cost-sharing technical assistance to
eligible import-impacted U.S. manufacturing
[[Page 8374]]
firms, oil and natural gas production firms, and service firms in all
50 States, the District of Columbia, and the Commonwealth of Puerto
Rico. Technical assistance is provided through a nationwide network of
11 TAACs, which are non-profit or university-affiliated entities.
TAACs provide eligible firms with customized assistance from
industry experts knowledgeable about the unique needs, challenges, and
opportunities facing industries in their respective regions. Firms work
with TAACs to apply for certification of eligibility for TAAF
assistance. Firms demonstrate their eligibility by documenting that
they have experienced a decline in sales or a decline or impending
decline in employment or worker hours, and that an increase of imports
of directly competitive goods or services contributed importantly to
such declines. EDA then renders a decision regarding the firms'
eligibility.
TAACs work closely with eligible firms' management to identify the
firms' strengths and weaknesses and then develop customized business
recovery plans, APs, which are designed to stimulate recovery and
growth. The TAAF program pays up to 75 percent of the costs of
developing APs. EDA reviews firms' APs and determines whether or not to
approve them. When an AP has been approved, firm management and TAAC
staff jointly identify consultants with the specific expertise to help
the firm implement the AP. If the cost exceeds the simplified
acquisition threshold, consultants are selected through a competitive
procurement process.
Overview of Changes to the TAAF Regulations
The discussion that follows presents an overview of substantive
changes by subpart letter and section number.
Subpart A
EDA is transferring Sec. Sec. 315.4 and 315.5 from subpart A to
subpart B. This change will retain all general provisions within
subpart A, while consolidating the regulations regarding TAAC
selection, operation, role, and coverage within subpart B.
Section 315.1
EDA is replacing this section with a new programmatic description
of TAAF's purpose. The revised section more clearly lays out the
process by which EDA executes its responsibilities concerning the TAAF
program, as delegated by the Secretary of Commerce, and the process by
which firms work with TAACs to request and obtain Adjustment
Assistance.
Section 315.2
EDA is making changes to the definitions identified below.
Adjustment Assistance
EDA is making three revisions to the definition of Adjustment
Assistance. First, EDA is removing the reference to ``or industries.''
As explained further in the discussion of the changes to Sec. 315.17,
EDA is eliminating its regulations related to the provision of trade
adjustment assistance to industries. EDA has historically not provided
separate industry-wide assistance programs because firms within
impacted industries have solicited help through TAAF on an individual
basis and because there has been no demand for industry-wide
assistance. In addition, EDA provides expedited review of petitions and
APs from firms within impacted industries. When the U.S. International
Trade Commission (``ITC'') makes an injury determination, in accordance
with chapter 3 of the Trade Act, EDA provides expedited consideration
to petitions by firms in the affected industry, as well as expedited
assistance in preparing and processing AP applications to such firms.
EDA believes this individualized approach has been effective in
facilitating adjustments within both firms and industries. The removal
of regulations that reference trade adjustment assistance to industries
will help prevent potential confusion regarding the availability of a
parallel industry program. In the event that EDA does determine it is
appropriate to provide trade adjustment assistance for industries, EDA
will promulgate new regulations to implement the program.
Second, EDA is revising the definition to clarify that Adjustment
Assistance refers to technical assistance provided by TAACs. The
current regulation is ambiguous and could be interpreted such that EDA
provides the technical assistance directly, which is not the case.
Third, EDA is adding to the definition a statement that EDA determines
what type of assistance is provided and adding a list of the types of
assistance that this may include: Preparing a firm's petition for
certification of eligibility, developing an AP, and implementing an AP.
Adjustment Proposal
EDA is revising the definition for Adjustment Proposal, clarifying
that the AP is a firm's plan for improving its competitiveness in the
marketplace, consistent with the intent of the TAAF program as
established in the Trade Act.
Decreased Absolutely
EDA is making a minor change to the definition of Decreased
Absolutely to add language clarifying that a firm's sales or production
must have declined by a minimum of five percent relative to its sales
or production during the applicable time period and that the decline is
independent of industry or market fluctuations and relative only to the
previous performance of the firm unless EDA determines that such
limitations would not be consistent with the purposes of the Trade Act.
Directly Competitive
EDA is revising the defined term Directly Competitive to add the
words ``or Like'' to the end, such that the term will be Directly
Competitive or Like. This change will more closely align this term with
the terminology of the Trade Act. EDA is further revising this
definition by adding language that clarifies the linkage between this
definition and the reference to firms that engage in exploring,
drilling, or producing oil or natural gas. By adding the phrase ``For
the purposes of this term,'' before the final sentence in this
definition, EDA reinforces the requirement in Section 251 of the Trade
Act that firms that engage in these types of activities be considered
as producing articles that are directly competitive with imported oil
and natural gas for the purposes of TAAF eligibility.
Firm
EDA is capitalizing the term, ``Unjustifiable Benefits,'' as
referenced in this definition. This change is the result of EDA adding
a definition for Unjustifiable Benefits, as described below. EDA is
further revising this definition by adding to the sub-definition of
Subsidiary, which is included as a category of firm that may be
considered jointly with another firm that is requesting Adjustment
Assistance pursuant to TAAF in an effort to prevent Unjustifiable
Benefits. EDA is qualifying the definition of Subsidiary by adding an
explanation that a firm acquired by another firm but which operates
independently of the acquiring firm is considered an Independent
Subsidiary and may be considered separately from the acquiring firm as
eligible for Adjustment Assistance. This change reflects existing
practice and addresses a growing trend in petitions requesting
Adjustment Assistance for firms that have been acquired by another firm
but continue to operate independently after the
[[Page 8375]]
acquisition, generally retaining the same management, maintaining
control over management decisions, and otherwise continuing operations
without significant change.
Increase in Imports
EDA is modifying this definition by moving the second sentence of
this definition to the revised subpart C (Certification of firms) as a
new paragraph (c) in Sec. 315.6 (Certification Requirements). EDA
believes this sentence is more appropriately located in subpart C as a
description of one method for a firm to demonstrate that it meets the
eligibility requirements for Certification to apply for Adjustment
Assistance. The sentence provides that a firm may submit certifications
from a firm's customers that account for a significant percentage of
the firm's decrease in sales or production, that the customers
increased their purchase of imports of Directly Competitive or Like
Articles or Services from a foreign country.
Partial Separation
EDA is changing the definition of Partial Separation by replacing
language denoting that this definition is with respect to any
employment in a firm with language which clarifies that a Partial
Separation occurs when there has been no increase in overall employment
at the firm and either of the conditions currently described in this
definition exist: (1) A reduction in an employee's work hours to 80
percent or less of the employee's average weekly hours during the year
of such reductions as compared to the preceding year; or (2) a
reduction in the employee's weekly wage to 80 percent or less of his/
her average weekly wage during the year of such reduction as compared
to the preceding year. EDA occasionally receives petitions submitted by
firms whose overall employment figures have increased within the
periods of time in question and which, nonetheless, assert that there
has been a Partial Separation with regards to a certain portion of
their workforce's work hours or weekly wages. EDA believes that this
revision should resolve the apparent confusion caused by the current
wording and clarify that a firm does not meet the eligibility criteria
if its overall employment has increased during the relevant time
period.
Service Sector Firm
EDA is revising the definition of Service Sector Firm to remove the
last two sentences of the definition because they are already included
in the definition of firm.
Total Separation
EDA is streamlining and clarifying the definition of Total
Separation by removing the phrase ``with respect to any employment in a
firm'' and adding the words ``in a firm'' after ``the laying off or
termination of employment of an employee.''
Unjustifiable Benefits
As noted above, EDA is also adding a definition for Unjustifiable
Benefits. Under this new definition, Unjustifiable Benefits describe
Adjustment Assistance inappropriately accruing to the benefit of (1)
other firms that would not otherwise be eligible when provided to a
firm or (2) any predecessor or successor firm, or any affiliated firm
controlled or substantially beneficially owned by substantially the
same person, rather than treating these entities as a single firm. EDA
believes that this is an important concept that should be fully
explained to help firms understand TAAF eligibility requirements.
Section 315.3
EDA is not changing this section.
Subpart B
EDA is revising this subpart to consolidate and clarify all
regulations regarding TAAC selection, operations, and coverage. The
revised subpart B, entitled ``TAAC Provisions,'' would be inserted
after Sec. 315.3 and would include revised Sec. Sec. 315.4 and 315.5,
which would be transferred to subpart B from subpart A.
Section 315.4
EDA is revising paragraph (a) of this section to better describe
the TAAC selection process.
EDA is revising paragraph (b) of this section to replace the
existing language with an explanation that TAACs are awarded
cooperative agreements that are subject to all Federal laws and to
Federal, Department, and EDA policies, regulations, and procedures
applicable to Federal financial assistance awards, including 2 CFR part
200, Uniform Administrative Requirements, Cost Principles, and Audit
Requirements for Federal Awards, and that TAACs work closely with EDA
and import-impacted firms.
Section 315.5
EDA is re-designating paragraph (a)(1) as paragraph (a) and, in
that same paragraph, revising the third sentence in order to clarify
that information regarding all of the TAACs' service areas, rather than
just particular geographic areas, are available at the websites listed
in that section.
EDA is re-designating paragraphs (a)(2) and (3) as paragraphs (b)
and (c), respectively. EDA is also streamlining newly re-designated
paragraph (c) by renumbering paragraphs (i) and (ii) as (1) and (2),
respectively, and by rewording newly re-designated paragraphs (c)(1)
and (2) to provide enhanced clarity on the types of Adjustment
Assistance a TAAC may provide to a firm.
EDA is removing existing paragraphs (b), (c), and (d) in their
entirety. EDA believes these paragraphs are unnecessary, as these
provisions and requirements will generally be covered in the Notice of
Funding Opportunity used to announce the availability of funding for
TAAC awards.
Subpart C
EDA is revising subpart C to consolidate all regulations regarding
the certification of firms. The revised subpart C will include
Sec. Sec. 315.6 through 315.10.
Section 315.6
EDA is moving the matching share requirements for APs as set forth
in current paragraph (c)(2) to the new Sec. 315.11 (``Adjustment
Proposal Process'') in subpart D (``Adjustment Proposals''). EDA is
eliminating the remaining requirements in Sec. 315.6, which are
duplicative of other regulations in this part and provide no additional
guidance or clarity to TAACs or firms. Finally, EDA is re-designating
the current Sec. 315.7 as Sec. 315.6.
In addition to these revisions, as noted above in the discussion
regarding revisions to the definition of Increase in Imports at Sec.
315.2, EDA is adding a new paragraph (c) to revised Sec. 315.6 and
moving into this paragraph the language formerly located in the
definition of Increase in Imports that enabled firms to help
demonstrate that they meet the eligibility requirements for Adjustment
Assistance by submitting certification from the firm's customers that
account for a significant percentage of the firms' decrease in sales or
production, that the customers increased their purchase of imports of
Directly Competitive or Like Articles or Services from a foreign
country. EDA is further adding to this new paragraph (c) a sentence
specifying that such certification from a firm's customer must be
submitted directly to a TAAC or to EDA. EDA believes this addition will
ease some confusion by firms, some of which have requested their
customers to provide such certification directly to the firms which
subsequently pass on the certifications to EDA through the TAACs.
[[Page 8376]]
Section 315.7
EDA is re-designating the current Sec. 315.8 as Sec. 315.7.
EDA is revising paragraph (b)(5) to clarify the additional
requirements for publicly-owned corporations when submitting financial
information as part of their petitions for certification. EDA is
revising the paragraph to clarify that publicly-owned corporations
should submit copies of the most recent Form 10-K annual reports (or
Form 10-Q quarterly reports, as appropriate) filed with the U.S.
Securities and Exchange Commission for the entire period covered by the
petition.
EDA is also revising paragraph (b)(6) to make clear the information
required regarding a firm's customers. Specifically, EDA is replacing
the qualifier that the description relates to the ``major'' customers
of the firm with one that identifies the customers as ``accounting for
a significant percent of the firm's decline.'' EDA is further revising
this paragraph to clarify that firms should submit information
regarding those customers' purchases or the firm's unsuccessful bids if
there are no customers fitting the description outlined in this
paragraph.
EDA is revising paragraph (f) to clarify that, in order to withdraw
a petition for certification, the petitioner must submit a request for
withdrawal before EDA makes a determination regarding approval or
denial of the certification.
EDA is revising paragraphs (g)(1) and (2) of this section. EDA is
revising paragraph (g)(1) in order to make clear that EDA may request
additional material from a firm beyond what was submitted with the
firm's original petition if necessary to make a determination regarding
the firm's eligibility for Adjustment Assistance. In addition, EDA is
revising paragraph (g)(1) to insert the word ``calendar'' before the
word ``days.'' EDA is also making similar revisions to all references
to ``days'' found throughout part 315. EDA is making these changes to
clarify that all references to ``days'' within part 315 refer to
calendar days as the current regulations are not clear on whether these
references to ``days'' are calendar or business days. EDA is revising
paragraph (g)(2) to clarify that firms may not resubmit a petition
within one year from the date of a denial without a waiver from EDA
issued for good cause.
Section 315.8
EDA is re-designating the current Sec. 315.9 as Sec. 315.8.
For the reasons discussed above, EDA is inserting the word
``calendar'' in front of the word ``days'' in the introductory
paragraph to this section.
EDA is revising paragraph (b)(2) to clarify that, when someone
other than the petitioner requests a public hearing on an accepted
petition, the requester must include a statement describing the nature
of the requester's interest in the proceedings.
EDA is also revising paragraph (d) of this section to clarify that
EDA will publish a notice of a public hearing in the Federal Register
only if EDA has made the determination that the requesting party has a
substantial interest in the hearing.
Section 315.9
EDA is re-designating the current Sec. 315.10 as Sec. 315.9.
EDA is also revising paragraphs (a), (b), and (d) to replace the
word ``Failure'' at the beginning of each of those paragraphs with the
words ``The firm failed'' to provide clarity regarding which entity's
omission triggers the loss of benefits. EDA is further revising
paragraph (d) to read: ``The firm failed to diligently pursue an
approved Adjustment Proposal, and five years have elapsed since the
date of certification.''
Section 315.10
EDA is re-designating the current Sec. 315.11 as Sec. 315.10.
EDA is revising paragraphs (a) and (b) of this section by inserting
the word ``calendar'' before the word ``days'' for the reasons
mentioned above.
EDA is removing the designation of paragraph (d) and adding the
sentence that formerly stood alone as paragraph (d) to the end of
paragraph (c) in this same section. EDA believes this reorganization
will reduce potential confusion by placing all requirements regarding
the steps EDA takes when it terminates a certification in a single
paragraph.
Subpart D
EDA is not changing the designation or heading of this subpart.
However, EDA is revising this subpart to include Sec. Sec. 315.11 and
315.12.
Section 315.11
Section 315.11 will be revised to combine requirements currently
contained in other sections of part 315 and add new language to reflect
best practices. The section heading will be revised to ``Adjustment
Proposal Process.''
EDA is moving paragraphs (a)(2) and (3) from the current Sec.
315.6 to the revised Sec. 315.11 as paragraphs (a) and (b) within this
section in order to consolidate AP procedures within a single section.
In order to more clearly reflect the requirements of the Trade Act, EDA
is moving the requirement established in the current Sec. 315.16(a),
which says APs must be submitted to EDA for approval within two years
after the date of Certification, to the new Sec. 315.11(a).
In addition to moving the requirements that currently exist in
Sec. 315.6(a)(3) to the revised Sec. 315.11(b), EDA is adding
language to these requirements that will require firms to begin
implementation of their approved AP within six months after approval.
EDA is also adding a requirement that firms that do not begin
implementation within six months after approval must update and re-
submit their AP for re-approval before any Adjustment Assistance may be
provided. These additions reflect long-standing practice and will help
firms to ensure that their APs reflect the most up-to-date economic
conditions and financial situation and, consequently, that the firms
will receive the most effective Adjustment Assistance.
EDA is adding a paragraph (c) to this section that discusses how
EDA will make a determination regarding an AP no later than 60 calendar
days after receipt of the AP, which incorporates the requirement from
Section 252(b)(2) of the Trade Act.
EDA is also adding a paragraph (d) to this section. EDA is moving
the matching share requirements for Adjustment Assistance from the
existing Sec. 315.6(b)(2) to this paragraph. In addition, EDA is
adding a sentence stating that certified firms may request no more than
the amount established by EDA for total Adjustment Assistance over the
entire lifetime of the firm. This addition incorporates current
practice, established to ensure that the maximum number of eligible
firms are able to receive Adjustment Assistance and to encourage
certified firms to appropriately plan and implement their Adjustment
Proposals within established funding limits.
EDA is adding a paragraph (e) to this section and specifying within
this paragraph that firms may request EDA approval to amend their APs
within two years from the date of EDA approval of their initial APs.
This new language incorporates current practice and allows firms to
update their APs as needed within the two-year time frame to address
any unexpected changes in their situation, new information, or a need
to re-direct resources to areas of greatest need.
EDA is also adding a paragraph (f) to this section. Paragraph (f)
requires firms
[[Page 8377]]
to complete implementation of their APs within five years of EDA
approval of their initial APs. This added language reflects current
practice and EDA's expectation that firms who request Adjustment
Assistance are financially and operationally prepared to engage in the
TAAF program and will implement their AP in a timely way.
EDA is adding a paragraph (g) to this section to address what
occurs if a certified firm is transferred, sold, or otherwise acquired
by another firm during the five-year period established in paragraph
(f). Paragraph (g) requires a certified firm that is transferred, sold,
or otherwise acquired by another firm during the five-year period of
Adjustment Assistance to notify EDA no later than 30 calendar days
following the transfer, sale, or acquisition. EDA will then make a
determination as to whether the firm remains eligible for Adjustment
Assistance. This new language incorporates current practice and is
designed to resolve any confusion about how firms and TAACs should
handle this scenario.
Finally, EDA is adding a paragraph (h) to this section. Paragraph
(h) will require firms that receive Adjustment Assistance to provide
data regarding the firms' sales, employment, and productivity upon
completion of the program and each year for the two-year period
following completion. This language incorporates into the regulations
reporting requirements established in Section 255A of the Trade Act,
which requires EDA to report annually to Congress on data regarding the
TAAF program for the preceding fiscal year.
Section 315.12
EDA is re-designating the current Sec. 315.16 as Sec. 315.12. As
discussed above, EDA is eliminating paragraph (a) of this section after
moving the requirement that firms must submit their APs to EDA within
two years of the date of certification to Sec. 315.11(a).
EDA is eliminating the current Sec. 315.12 (Recordkeeping). With
the proposed revisions to Sec. 315.4(b), which states that TAAC
cooperative agreements are subject to all Federal laws and to Federal,
Department, and EDA policies, regulations, and procedures applicable to
Federal financial assistance awards, including 2 CFR part 200, the
current Sec. 315.12 is no longer needed as recordkeeping requirements
are adequately addressed in those materials.
Subpart E
EDA is revising the heading for this subpart to ``Protective
Provisions.'' As revised, subpart E will include Sec. Sec. 315.13 and
315.14. EDA is moving the requirements regarding persons engaged by
firms to expedite petitions and APs as found in the current Sec.
315.14 (Certifications) and the requirements regarding conflicts of
interest that are contained the current Sec. 315.15 (Conflicts of
interest), both of which are found in the current subpart C, to subpart
E. EDA believes this reorganization and new location will make it
easier for firms to read and understand the regulations and will help
clarify that these provisions apply to firms at all stages of the TAAF
program.
Section 315.13
EDA is moving the requirements for firms to certify in writing to
EDA the names of any attorneys, agents, and other Persons engaged by or
on behalf of the firm for the purpose of expediting Petitions for
Adjustment Assistance and the fees paid or to be paid to any such
Person, as found in the current Sec. 315.14, to Sec. 315.13. EDA is
further revising these requirements by clarifying, in paragraph (a),
that they apply to both Adjustment Assistance and APs.
EDA is eliminating the current Sec. 315.13 (Audit and
examination). With the proposed revisions to Sec. 315.4(b), which
states that TAAC cooperative agreements are subject to all Federal laws
and to Federal, Department, and EDA policies, regulations, and
procedures applicable to Federal financial assistance awards, including
2 CFR part 200, the current Sec. 315.13 is no longer needed as audit
and examination requirements are adequately addressed in those
materials.
Section 315.14
EDA is moving the requirements found in the current Sec. 315.15 to
Sec. 315.14. EDA is also revising these requirements by modifying the
list of firm representatives subject to the conflicts of interest
requirements to parallel the list of firm representatives identified in
the revised Sec. 315.13.
Subpart F
EDA is adding subpart F, entitled ``International Trade Commission
Investigations.'' Subpart F sets forth, through Sec. 315.15, what
actions EDA takes when the ITC makes an affirmative finding under
section 202(b) of the Trade Act regarding injury or threat of injury to
an industry.
Section 315.15
EDA is re-designating the current Sec. 315.17 as Sec. 315.15 and
is revising the heading of this section to ``Affirmative Findings.''
EDA is also removing the designation ``(a)'' from the first paragraph
of this section and eliminating paragraphs (b) and (c) to reflect the
fact that EDA, historically, has not provided Adjustment Assistance for
the establishment of industry-wide programs for new product
development, export development, or other uses consistent with the
purposes of the Trade Act because there has been no demand for such
programs. As noted above in the discussion regarding changes to the
definition of Adjustment Assistance in Sec. 315.2, firms within
impacted industries have sought Adjustment Assistance through TAAF on
an individual basis rather than through industry-wide solutions. EDA
also provides expedited review of petitions and APs from firms within
industries for which the ITC has determined that increased imports are
a substantial cause of serious injury or threat thereof under section
202(b) of the Trade Act. This individualized approach enables EDA to
support adjustments at the firm level, while having a cumulative impact
at the industry level.
EDA is replacing within this paragraph the language stating that
EDA will provide to firms in the identified industry assistance in the
preparation and processing of petitions and applications for benefits;
EDA instead will include language establishing notification to TAACs
and expedited review of petitions and APs from firms within the
specified industry. EDA believes these revisions more clearly describe
the assistance EDA provides to industries in response to determinations
made by the ITC under the Trade Act.
This revised section contains one technical correction to the
proposed revision in the NPRM published in the Federal Register on
August 19, 2019 (84 FR 42831). The correction is to eliminate an
improper citation to the Tariff Act. The proposed revision to this
section provided that EDA would notify TAACs and provide expedited
review of petitions and APs from Firms within an industry for which the
ITC has made an affirmative finding under section 202(b) of the Trade
Act or under sections 705 or 735 of the Tariff Act. Determinations made
under section 202(b) of the Trade Act concern serious injury or threat
thereof to a domestic injury, while determinations made under sections
705 or 735 of the Tariff Act concern lesser material injury or threat
thereof to a domestic industry. Pursuant to section 202(g) of the Trade
Act, EDA is only required to provide expedited review of petitions
submitted by firms in industries for which the ITC has made
[[Page 8378]]
an affirmative determination under section 202(b) of the Trade Act.
Part II: Updates to PWEDA Regulations
PWEDA Background
PWEDA is EDA's organic authority and the primary legal authority
under which EDA awards grants. Other legal authorities include the
Trade Act and the Stevenson-Wydler Technology Innovation Act of 1980.
Under PWEDA, EDA provides financial assistance to both rural and urban
distressed communities by fostering entrepreneurship, innovation, and
productivity through investments in infrastructure development,
capacity building, and business development in order to attract private
capital investments and new and better jobs to regions experiencing
substantial and persistent economic distress.
Overview of Eliminated PWEDA Regulations
EDA is eliminating certain provisions within part 302 of the PWEDA
regulations that are unnecessary or already established in other
regulations or award documentation. Specifically, EDA is eliminating
the regulations located at 13 CFR 302.4, 302.5, and 302.14. These
regulations describe: The responsibilities of EDA grant recipients to
maintain records, how information supplied to EDA may be subject to
public release under the Freedom of Information Act or Privacy Act, how
government auditors may need access to various records, and that grant
recipients are subject to the government-wide relocation assistance and
land acquisition policies. These regulations can be removed because
notice of these terms and conditions is already provided to grant
recipients through other Department of Commerce-wide or government-wide
regulations as well as in specific documentation EDA provides to each
grant recipient. Specifically, recipients of EDA financial assistance
are already subject to the requirements related to the Freedom of
Information Act or Privacy Act currently described in Sec. 302.4
through 15 CFR part 4 and the Standard Terms and Conditions of an EDA
award. Similarly, the relocation and land acquisition policies
currently found in Sec. 302.5 are already applicable to all EDA
financial assistance recipients under government-wide regulations found
at 49 CFR part 24. Finally, the record-keeping requirements currently
located in Sec. 302.14 duplicate the requirements of Section 608 of
PWEDA (42 U.S.C. 3218), 2 CFR 200.333 and 200.336, and the Standard
Terms and Conditions of an EDA award.
In addition, EDA is eliminating 13 CFR 302.11. Beginning with the
enactment of the original section 502 of PWEDA (42 U.S.C. 3192) in
1998, Congress has required EDA to maintain an economic development
information clearinghouse on matters related to economic development,
economic adjustment, disaster recovery, defense conversion, and trade
adjustment programs and activities. See Public Law 105-393. With the
EDA Reauthorization Act of 2004 (Pub. L. 108-373 (Oct. 27, 2004)),
Congress amended section 502 to require EDA to, among other things,
maintain this information clearinghouse online. The current regulation
adds nothing of value to the requirements already in place under
section 502 and consequently should be eliminated.
Classification
Regulatory Flexibility Act
Prior notice and opportunity for public comment are not required
for rules concerning public property, loans, grants, benefits, and
contracts (5 U.S.C. 553(a)(2)). EDA's programs, including the TAAF
program, are financial assistance programs provided through grants and
cooperative agreements. As such, prior notice and an opportunity for
public comment are not required pursuant to 5 U.S.C. 553, or any other
law, and the analytical requirements of the Regulatory Flexibility Act
(5 U.S.C. 601 et seq.) are inapplicable. Although EDA did choose to
publish an NPRM in the Federal Register requesting public comments on
the content of this final rule (84 FR 42831), EDA received no comments
in response to the NPRM, and thus has received no input from the public
bearing on the analytical requirements of the Regulatory Flexibility
Act. For these reasons, a regulatory flexibility analysis has not been
prepared.
Executive Orders No. 12866, 13563, and 13771
This final rule was drafted in accordance with Executive Orders
12866, 13563, and 13771. The Office of Management and Budget (``OMB'')
has determined that this final rule is not significant for purposes of
Executive Order 12866 and Executive Order 13563.
This rule is a deregulatory action that has a neutral effect on the
costs to firms, organizations, and all other stakeholders to comply
with the regulations discussed in this notice of final rule. It is
therefore considered to have a total incremental cost of zero pursuant
to the April 5, 2017, OMB guidance memorandum implementing Executive
Order 13771 (M-17-21).
Congressional Review Act
This final rule is not major under the Congressional Review Act (5
U.S.C. 801 et seq.).
Executive Order No. 13132
Executive Order 13132 requires agencies to develop an accountable
process to ensure ``meaningful and timely input by State and local
officials in the development of regulatory policies that have
federalism implications.'' ``Policies that have federalism
implications'' is defined in Executive Order 13132 to include
regulations that have ``substantial direct effects on the States, on
the relationship between the national government and the States, or on
the distribution of power and responsibilities among the various levels
of government.'' This final rule does not contain policies that have
federalism implications.
Paperwork Reduction Act
The Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.)
(``PRA'') requires that a Federal agency consider the impact of
paperwork and other information collection burdens imposed on the
public and, under the provisions of PRA section 3507(d), obtain
approval from OMB for each collection of information it conducts,
sponsors, or requires through regulations. Notwithstanding any other
provision of law, no person is required to respond to, nor shall any
person be subject to a penalty for failure to comply with a collection
of information subject to the PRA unless that collection displays a
currently valid OMB Control Number.
The following table provides the only collections of information
(and corresponding OMB Control Numbers) set forth in this final rule.
These collections of information are necessary for the proper
performance and functions of EDA. This final rule does not include a
new information collection requirement and will, thus, use previously
approved information collections to collect information relevant to a
petition for certification of eligibility for trade adjustment
assistance or an AP.
[[Page 8379]]
------------------------------------------------------------------------
Part or section of Form/Title/OMB
this final rule Nature of request control No.
------------------------------------------------------------------------
315.7(b)............. Firms seeking certification of Form ED-840P,
eligibility to apply for trade Petition by a
adjustment assistance must firm for
complete Form ED-840P, which Certification
provides EDA with the of Eligibility
information needed to to Apply for
determine if a firm is Trade
eligible to apply for trade Adjustment
adjustment assistance. Assistance
(0610-0091).
315.12............... The information for Adjustment Adjustment
Proposals is collected Proposal (0610-
pursuant to the same OMB 0091).
control number as Form ED-840P
(0610-0091). Firms certified
by EDA as eligible to apply
for trade adjustment
assistance must prepare an
Adjustment Proposal and submit
it to EDA for approval within
two years after the date of
certification. This provides
EDA with the information
needed to determine whether
the Adjustment Proposal meets
the requirements of the Trade
Act and 13 CFR part 315.
------------------------------------------------------------------------
List of Subjects
13 CFR Part 302
Community development, Grant programs-business, Grant programs-
housing and community development, Technical assistance.
13 CFR Part 315
Administrative practice and procedure, Community development, Grant
programs-business, Reporting and recordkeeping requirements, Trade
adjustment assistance.
For the reasons discussed above, EDA is amending 13 CFR chapter III
as follows:
PART 302-GENERAL TERMS AND CONDITIONS FOR INVESTMENT ASSISTANCE
0
1. The authority citation of part 302 continues to read as follows:
Authority: 19 U.S.C. 2341 et seq.; 42 U.S.C. 3150; 42 U.S.C.
3152; 42 U.S.C. 3153; 42 U.S.C. 3192; 42 U.S.C. 3193; 42 U.S.C.
3194; 42 U.S.C. 3211; 42 U.S.C. 3212; 42 U.S.C. 3216; 42 U.S.C.
3218; 42 U.S.C. 3220; 42 U.S.C. 5141; 15 U.S.C. 3701; Department of
Commerce Delegation Order 10-4.
Sec. Sec. 302.4 and 302.5 [Removed]
0
2. Remove Sec. Sec. 302.4 and 302.5.
Sec. 302.11 [Removed]
0
3. Remove Sec. 302.11.
Sec. 302.14 [Removed]
0
4. Remove Sec. 302.14.
PART 315--TRADE ADJUSTMENT ASSISTANCE FOR FIRMS
0
5. Revise the authority citation of part 315 to read as follows:
Authority: 19 U.S.C. 2341-2356; 42 U.S.C. 3211; Title IV of Pub.
L. 114-27, 129 Stat. 373; Department of Commerce Delegation Order
10-4.
0
6. Revise Sec. 315.1 to read as follows:
Sec. 315.1 Purpose and scope.
Chapter 3 of title II of the Trade Act of 1974 (19 U.S.C. 2341-
2355) establishes the responsibilities of the Secretary of Commerce
concerning the Trade Adjustment Assistance for Firms (TAAF) program.
The regulations in this part lay out those responsibilities as
delegated to EDA by the Secretary. EDA executes these responsibilities
through cooperative agreements that support a network of Trade
Adjustment Assistance Centers (TAACs). The TAACs assist Firms in
petitioning EDA for certification of eligibility to receive Adjustment
Assistance. EDA certifies the eligibility of Firms. The TAACs then
provide Adjustment Assistance to Firms through the development and
implementation of Adjustment Proposals.
0
7. Amend Sec. 315.2 by:
0
a. Revising the introductory text and the definitions for ``Adjustment
Assistance'' and ``Adjustment Proposal'';
0
b. In the definition of ``Decreased Absolutely'', revising the
introductory text;
0
c. Removing the definition of ``Directly Competitive'' and adding the
definition of ``Directly Competitive or Like'' in its place;
0
d. In the definition of ``Firm'', revising the introductory text and
paragraph (4);
0
e. Revising the definition of ``Increase in Imports'';
0
f. In the definition of ``Partial Separation'', revising the
introductory text;
0
g. Revising the definitions of ``Service Sector Firm'' and ``Total
Separation''; and
0
h. Adding in alphabetical order a definition for ``Unjustifiable
Benefits''.
The revisions and additions read as follows:
Sec. 315.2 Definitions.
In addition to the defined terms set forth in Sec. 300.3 of this
chapter, the following terms used in this part shall have the meanings
set forth below:
Adjustment Assistance means technical assistance provided to Firms
by TAACs under chapter 3 of title II of the Trade Act. The type of
assistance provided is determined by EDA and may include one or more of
the following:
(1) Assistance in preparing a Firm's petition for certification of
eligibility;
(2) Assistance to a Certified Firm in developing an Adjustment
Proposal for the Firm; and
(3) Assistance to a Certified Firm in implementing an Adjustment
Proposal.
Adjustment Proposal means a Certified Firm's plan for improving the
Firm's competitiveness in the marketplace.
* * * * *
Decreased Absolutely means a Firm's sales or production has
declined by a minimum of five percent relative to its sales or
production during the applicable prior time period, and this decline
is:
* * * * *
Directly Competitive or Like means imported articles or services
that compete with and are substantially equivalent for commercial
purposes (i.e., are adapted for the same function or use and are
essentially interchangeable) as the Firm's articles or services. For
the purposes of this term, any Firm that engages in exploring or
drilling for oil or natural gas, or otherwise produces oil or natural
gas, shall be considered to be producing articles directly competitive
with imports of oil and with imports of natural gas.
Firm means an individual proprietorship, partnership, joint
venture, association, corporation (includes a development corporation),
business trust, cooperative, trustee in bankruptcy or receiver under
court decree, and includes fishing, agricultural or service sector
entities and those which explore, drill or otherwise produce oil or
natural gas. See also the definition of Service Sector
[[Page 8380]]
Firm. Pursuant to section 259 of chapter 3 of title II of the Trade Act
(19 U.S.C. 2351), a Firm, together with any predecessor or successor
firm, or any affiliated firm controlled or substantially beneficially
owned by substantially the same person, may be considered a single Firm
where necessary to prevent Unjustifiable Benefits. For purposes of
receiving benefits under this part, when a Firm owns or controls other
Firms, the Firm and such other Firms may be considered a single Firm
when they produce or supply like or Directly Competitive articles or
services or are exerting essential economic control over one or more
production facilities. Accordingly, such other Firms may include a(n):
* * * * *
(4) Subsidiary--a company (either foreign or domestic) that is
wholly owned or effectively controlled by another company. A Firm that
has been acquired by another Firm but which maintains operations
independent of the acquiring Firm is considered an Independent
Subsidiary and may be considered separately from the acquiring Firm as
eligible for TAAF assistance.
Increase in Imports means an increase in imports of Directly
Competitive or Like Articles or Services with articles produced or
services supplied by a Firm.
* * * * *
Partial Separation occurs when there has been no increase in
overall employment at the Firm and either of the following applies:
* * * * *
Service Sector Firm means a Firm engaged in the business of
supplying services.
* * * * *
Total Separation means the laying off or termination of employment
of an employee in a Firm for lack of work.
Unjustifiable Benefits means Adjustment Assistance inappropriately
accruing to the benefit of:
(1) Other Firms that would not otherwise be eligible when provided
to a Firm; or
(2) Any predecessor or successor Firm, or any affiliated Firm
controlled or substantially beneficially owned by substantially the
same person, rather than treating these entities as a single Firm.
Sec. Sec. 315.4, 315.5, and 315.6 [Removed]
0
8. Sections 315.4 through 315.6 are removed.
0
9. Revise subparts B through E and add subpart F to read as follows:
Subpart B--TAAC Provisions
Sec.
315.4 TAAC selection and operation.
315.5 The role and geographic coverage of the TAACs.
Subpart C--Certification of Firms
315.6 Certification requirements.
315.7 Processing petitions for certification.
315.8 Hearings.
315.9 Loss of certification benefits.
315.10 Appeals, final determinations, and termination of
certification.
Subpart D--Adjustment Proposals
315.11 Adjustment Proposal process.
315.12 Adjustment Proposal requirements.
Subpart E--Protective Provisions
315.13 Persons engaged by Firms to expedite petitions and Adjustment
Proposals.
315.14 Conflicts of interest.
Subpart F--International Trade Commission Investigations
315.15 Affirmative findings.
Subpart B--TAAC Provisions
Sec. 315.4 TAAC selection and operation.
(a) EDA solicits applications from organizations interested in
operating a TAAC through Notice of Funding Opportunity announcements
laying out selection and award criteria. The following entities are
eligible to apply:
(1) Universities or affiliated organizations;
(2) States or local governments; or
(3) Non-profit organizations.
(b) Entities selected to operate the TAACs are awarded cooperative
agreements and work closely with EDA and import-impacted firms. TAAC
cooperative agreements are subject to all Federal laws and to Federal,
Department, and EDA policies, regulations, and procedures applicable to
Federal financial assistance awards, including 2 CFR part 200.
Sec. 315.5 The role and geographic coverage of the TAACs.
(a) TAACs are available to assist Firms in obtaining Adjustment
Assistance in all 50 U.S. States, the District of Columbia, and the
Commonwealth of Puerto Rico. TAACs provide Adjustment Assistance in
accordance with this part either through their own staffs or by
arrangements with outside consultants. Information concerning TAACs and
their coverage areas may be obtained from the TAAC website at http://www.taacenters.org or from EDA at http://www.eda.gov.
(b) Prior to submitting a petition for Adjustment Assistance to
EDA, a Firm should determine the extent to which a TAAC can provide the
required Adjustment Assistance. EDA will provide Adjustment Assistance
through TAACs whenever EDA determines that such assistance can be
provided most effectively in this manner. Requests for Adjustment
Assistance will be made through TAACs.
(c) A TAAC generally provides Adjustment Assistance by:
(1) Helping a Firm to prepare its petition for eligibility
certification; and
(2) Assisting Certified Firms with diagnosing their strengths and
weaknesses, and with developing and implementing an Adjustment
Proposal.
Subpart C--Certification of Firms
Sec. 315.6 Certification requirements.
(a) General. Firms apply for certification through a TAAC by
completing a petition for certification. The TAAC will assist Firms in
completing such petitions at no cost to the Firms. EDA evaluates Firms'
petitions based on the requirements set forth in Sec. 315.7. EDA may
certify a Firm as eligible to apply for Adjustment Assistance under
section 251(c) of the Trade Act (19 U.S.C. 2341) if it determines that
the petition for certification meets one of the minimum certification
thresholds set forth in paragraph (b) of this section. In order to be
certified, a Firm must meet the criteria listed under any one of the
five circumstances described in paragraph (b) of this section.
(b) Minimum certification thresholds--(1) Twelve-month decline.
Based upon a comparison of the most recent 12-month period for which
data are available and the immediately preceding 12-month period:
(i) A Significant Number or Proportion of Workers in the Firm has
undergone Total or Partial Separation or a Threat of Total or Partial
Separation;
(ii) Either sales or production, or both, of the Firm has Decreased
Absolutely; or sales or production, or both, of any article or service
that accounted for not less than 25 percent of the total production or
sales of the Firm during the 12-month period preceding the most recent
12-month period for which data are available have Decreased Absolutely;
and
(iii) An Increase in Imports has Contributed Importantly to the
applicable Total or Partial Separation or Threat of Total or Partial
Separation, and to the applicable decline in sales or production or
supply of services.
(2) Twelve-month versus twenty-four month decline. Based upon a
comparison of the most recent 12-month period for which data are
available and the immediately preceding 24-month period:
[[Page 8381]]
(i) A Significant Number or Proportion of Workers in the Firm has
undergone Total or Partial Separation or a Threat of Total or Partial
Separation;
(ii) Either average annual sales or production, or both, of the
Firm has Decreased Absolutely; or average annual sales or production,
or both, of any article or service that accounted for not less than 25
percent of the total production or sales of the Firm during the 24-
month period preceding the most recent 12-month period for which data
are available have Decreased Absolutely; and
(iii) An Increase in Imports has Contributed Importantly to the
applicable Total or Partial Separation or Threat of Total or Partial
Separation, and to the applicable decline in sales or production or
supply of services.
(3) Twelve-month versus thirty-six month decline. Based upon a
comparison of the most recent 12-month period for which data are
available and the immediately preceding 36-month period:
(i) A Significant Number or Proportion of Workers in the Firm has
undergone Total or Partial Separation or a Threat of Total or Partial
Separation;
(ii) Either average annual sales or production, or both, of the
Firm has Decreased Absolutely; or average annual sales or production,
or both, of any article or service that accounted for not less than 25
percent of the total production or sales of the Firm during the 36-
month period preceding the most recent 12-month period for which data
are available have Decreased Absolutely; and
(iii) An Increase in Imports has Contributed Importantly to the
applicable Total or Partial Separation or Threat of Total or Partial
Separation, and to the applicable decline in sales or production or
supply of services.
(4) Interim sales or production decline. Based upon an interim
sales or production decline:
(i) Sales or production has Decreased Absolutely for, at minimum,
the most recent six-month period during the most recent 12-month period
for which data are available as compared to the same six-month period
during the immediately preceding 12-month period;
(ii) During the same base and comparative period of time as sales
or production has Decreased Absolutely, a Significant Number or
Proportion of Workers in such Firm has undergone Total or Partial
Separation or a Threat of Total or Partial Separation; and
(iii) During the same base and comparative period of time as sales
or production has Decreased Absolutely, an Increase in Imports has
Contributed Importantly to the applicable Total or Partial Separation
or Threat of Total or Partial Separation, and to the applicable decline
in sales or production or supply of services.
(5) Interim employment decline. Based upon an interim employment
decline:
(i) A Significant Number or Proportion of Workers in such Firm has
undergone Total or Partial Separation or a Threat of Total or Partial
Separation during, at a minimum, the most recent six-month period
during the most recent 12-month period for which data are available as
compared to the same six-month period during the immediately preceding
12-month period; and
(ii) Either sales or production of the Firm has Decreased
Absolutely during the 12-month period preceding the most recent 12-
month period for which data are available; and
(iii) An Increase in Imports has Contributed Importantly to the
applicable Total or Partial Separation or Threat of Total or Partial
Separation, and to the applicable decline in sales or production or
supply of services.
(c) Evidence of an increase in imports. EDA may consider as
evidence of an Increase in Imports a certification from the Firm's
customers that account for a significant percentage of the Firm's
decrease in sales or production, that they have increased their
purchase of imports of Directly Competitive or Like Articles or
Services from a foreign country, either absolutely or relative to their
acquisition of such Like Articles or Services from suppliers located in
the United States. Such certification from a Firm's customer must be
submitted directly to a TAAC or to EDA.
Sec. 315.7 Processing petitions for certification.
(a) Firms shall consult with a TAAC for guidance and assistance in
the preparation of their petitions for certification.
(b) A Firm seeking certification shall complete a Petition by a
Firm for Certification of Eligibility to Apply for Trade Adjustment
Assistance (Form ED-840P or any successor form) with the following
information about such Firm:
(1) Identification and description of the Firm, including legal
form of organization, economic history, major ownership interests,
officers, directors, management, parent company, Subsidiaries or
Affiliates, and production and sales facilities;
(2) Description of goods or services supplied or sold;
(3) Description of imported Directly Competitive or Like Articles
or Services with those produced or supplied;
(4) Data on its sales, production and employment for the applicable
24-month, 36-month, or 48-month period, as required under Sec.
315.6(b);
(5) One copy of a complete auditor's certified financial report for
the entire period covering the petition, or if not available, one copy
of the complete profit and loss statements, balance sheets and
supporting statements prepared by the Firm's accountants for the entire
period covered by the petition. In addition, publicly-owned
corporations should also submit copies of the most recent Form 10-K
annual reports (or Form 10-Q quarterly reports, as appropriate) filed
with the U.S. Securities and Exchange Commission for the entire period
covered by the petition;
(6) Information concerning customers accounting for a significant
percent of the Firm's decline and the customers' purchases (or the
Firm's unsuccessful bids, if there are no customers fitting this
description); and
(7) Such other information as EDA considers material.
(c) EDA shall determine whether the petition has been properly
prepared and can be accepted. Promptly thereafter, EDA shall notify the
petitioner that the petition has been accepted or advise the TAAC that
the petition has not been accepted, but may be resubmitted at any time
without prejudice when the specified deficiencies have been corrected.
Any resubmission will be treated as a new petition.
(d) EDA will publish a notice of acceptance of a petition in the
Federal Register.
(e) EDA will initiate an investigation to determine whether the
petitioner meets the requirements set forth in section 251(c) of the
Trade Act (19 U.S.C. 2341) and Sec. 315.6.
(f) A petition for certification may be withdrawn if EDA receives a
request for withdrawal submitted by the petitioner before EDA makes a
certification determination or denial. A Firm may submit a new petition
at any time thereafter in accordance with the requirements of this
section and Sec. 315.6.
(g) Following acceptance of a petition, EDA will:
(1) Make a determination based on the Record as soon as possible
after the petitioning Firm or TAAC has submitted all requested
material. In no event may the determination period exceed 40 calendar
days from the date on which EDA accepted the petition; and
(2) Either certify the petitioner as eligible to apply for
Adjustment
[[Page 8382]]
Assistance or deny the petition. In either event, EDA shall promptly
give written notice of action to the petitioner. Any written notice to
the petitioner of a denial of a petition shall specify the reason(s)
for the denial. A petitioner shall not be entitled to resubmit a
petition within one year from the date of denial unless EDA waives the
one-year limitation for good cause.
Sec. 315.8 Hearings.
EDA will hold a public hearing on an accepted petition if the
petitioner or any interested Person found by EDA to have a Substantial
Interest in the proceedings submits a request for a hearing no later
than 10 calendar days after the date of publication of the notice of
acceptance in the Federal Register, under the following procedures:
(a) The petitioner or any interested Person(s) shall have an
opportunity to be present, to produce evidence and to be heard.
(b) A request for public hearing must be delivered by hand or by
registered mail to EDA. A request by a Person other than the petitioner
shall contain:
(1) The name, address and telephone number of the Person requesting
the hearing; and
(2) A complete statement of the relationship of the Person
requesting the hearing to the petitioner and the subject matter of the
petition, and a statement of the nature of the requesting party's
interest in the proceedings.
(c) If EDA determines that the requesting party does not have a
Substantial Interest in the proceedings, a written notice of denial
shall be sent to the requesting party. The notice shall specify the
reasons for the denial.
(d) If EDA determines that the requesting party does have a
Substantial Interest in the proceedings, EDA shall publish a notice of
a public hearing in the Federal Register, containing the subject
matter, name of petitioner, and date, time and place of the hearing.
(e) EDA shall appoint a presiding officer for the hearing who shall
respond to all procedural questions.
Sec. 315.9 Loss of certification benefits.
EDA may terminate a Firm's certification or refuse to extend
Adjustment Assistance to a Firm for any of the following reasons:
(a) The Firm failed to submit an acceptable Adjustment Proposal
within two years after date of certification. While approval of an
Adjustment Proposal may occur after the expiration of such two-year
period, a Firm must submit an acceptable Adjustment Proposal before
such expiration.
(b) The Firm failed to submit documentation necessary to start
implementation or modify its request for Adjustment Assistance
consistent with its Adjustment Proposal within six months after
approval of the Adjustment Proposal, where two years have elapsed since
the date of certification. If the Firm anticipates needing a longer
period to submit documentation, it should indicate the longer period in
its Adjustment Proposal. If the Firm is unable to submit its
documentation within the allowed time, it should notify EDA in writing
of the reasons for the delay and submit a new schedule. EDA has the
discretion to accept or refuse a new schedule.
(c) EDA has denied the Firm's request for Adjustment Assistance,
the time period allowed for the submission of any documentation in
support of such request has expired, and two years have elapsed since
the date of certification.
(d) The Firm failed to diligently pursue an approved Adjustment
Proposal, and five years have elapsed since the date of certification.
Sec. 315.10 Appeals, final determinations, and termination of
certification.
(a) Any petitioner may appeal in writing to EDA from a denial of
certification, provided that EDA receives the appeal by personal
delivery or by registered mail within 60 calendar days from the date of
notice of denial under Sec. 315.7(g). The appeal must state the
grounds on which the appeal is based, including a concise statement of
the supporting facts and applicable law. The decision of EDA on the
appeal shall be the final determination within the Department. In the
absence of an appeal by the petitioner under this paragraph (a), the
determination under Sec. 315.7(g) shall be final.
(b) A Firm, its representative, or any other interested domestic
party aggrieved by a final determination under paragraph (a) of this
section may, within 60 calendar days after notice of such
determination, begin a civil action in the United States Court of
International Trade for review of such determination, in accordance
with section 284 of the Trade Act (19 U.S.C. 2395).
(c) Whenever EDA determines that a Certified Firm no longer
requires Adjustment Assistance or for other good cause, EDA will
terminate the certification and promptly publish notice of such
termination in the Federal Register. The termination will take effect
on the date specified in the published notice. EDA shall immediately
notify the petitioner and shall state the reasons for any termination.
Subpart D--Adjustment Proposals
Sec. 315.11 Adjustment Proposal process.
(a) Firms certified in accordance with the procedures described in
Sec. Sec. 315.6 and 315.7 must prepare an Adjustment Proposal and
submit it to EDA for approval within two years after the date of
certification.
(b) EDA determines whether to approve the Adjustment Assistance
requested in the Adjustment Proposal based upon the evaluation criteria
set forth in Sec. 315.12. Upon approval, a Certified Firm may submit a
request to the TAAC for Adjustment Assistance to implement an approved
Adjustment Proposal. Firms must begin implementation within six months
after approval. Firms that do not begin implementation within six
months after approval must update, re-submit their Adjustment Proposal,
and request re-approval before any Adjustment Assistance may be
provided.
(c) EDA will make a determination regarding the Adjustment Proposal
no later than 60 calendar days upon receipt of the Adjustment Proposal.
(d) Adjustment Assistance is subject to matching share
requirements. Each Certified Firm must pay at least 25 percent of the
cost of preparing its Adjustment Proposal. Each Certified Firm
requesting $30,000 or less in total Adjustment Assistance in its
approved Adjustment Proposal must pay at least 25 percent of the cost
of that Adjustment Assistance. Each Certified Firm requesting more than
$30,000 in total Adjustment Assistance in its approved Adjustment
Proposal must pay at least 50 percent of the cost of that Adjustment
Assistance. Certified Firms may request no more than the amount as
established by EDA for total Adjustment Assistance over the entire
lifetime of the firm.
(e) Firms may request EDA approval to amend their Adjustment
Proposals within two years from the date of EDA approval of their
initial Adjustment Proposal.
(f) Firms must complete implementation of their Adjustment
Proposals within five years of EDA approval of their initial Adjustment
Proposal.
(g) If a Certified Firm is transferred, sold, or otherwise acquired
by another Firm during the five-year period of Adjustment Assistance,
the Firm must notify EDA no later than 30 calendar days following the
transfer, sale, or acquisition. EDA will then make a determination as
to whether the Firm remains eligible for Adjustment Assistance. EDA
will make this
[[Page 8383]]
determination no later than 60 calendar days following notification by
the Firm.
(h) In accordance with Section 255A of chapter 3 of title II of the
Trade Act (19 U.S.C. 2345a), Firms that receive Adjustment Assistance
must provide data regarding the Firms' sales, employment, and
productivity upon completion of the program and each year for the two-
year period following completion.
Sec. 315.12 Adjustment Proposal requirements.
EDA evaluates Adjustment Proposals based on the following:
(a) The Adjustment Proposal must include a description of any
Adjustment Assistance requested to implement such proposal, including
financial and other supporting documentation as EDA determines is
necessary, based upon either:
(1) An analysis of the Firm's problems, strengths, and weaknesses
and an assessment of its prospects for recovery; or
(2) If EDA so determines, other available information;
(b) The Adjustment Proposal must:
(1) Be reasonably calculated to contribute materially to the
economic adjustment of the Firm (i.e., that such proposal will
constructively assist the Firm to establish a competitive position in
the same or a different industry);
(2) Give adequate consideration to the interests of a sufficient
number of separated workers of the Firm, by providing, for example,
that the Firm will:
(i) Give a rehiring preference to such workers;
(ii) Make efforts to find new work for a number of such workers;
and
(iii) Assist such workers in obtaining benefits under available
programs; and
(3) Demonstrate that the Firm will make all reasonable efforts to
use its own resources for its recovery, though under certain
circumstances, resources of related Firms or major stockholders will
also be considered; and
(c) The Adjustment Assistance identified in the Adjustment Proposal
must consist of specialized consulting services designed to assist the
Firm in becoming more competitive in the global marketplace. For
purposes of this paragraph (c), Adjustment Assistance generally
consists of knowledge-based services such as market penetration
studies, customized business improvements, and designs for new
products. Adjustment Assistance does not include expenditures for
capital improvements or for the purchase of business machinery or
supplies.
Subpart E--Protective Provisions
Sec. 315.13 Persons engaged by Firms to expedite petitions and
Adjustment Proposals.
EDA will provide no Adjustment Assistance to any Firm unless the
owners, partners, members, directors, or officers thereof certify in
writing to EDA:
(a) The names of any attorneys, agents, and other Persons engaged
by or on behalf of the Firm for the purpose of expediting petitions for
such Adjustment Assistance or Adjustment Proposals; and
(b) The fees paid or to be paid to any such Person.
Sec. 315.14 Conflicts of interest.
EDA will provide no Adjustment Assistance to any Firm under this
part unless the owners, partners, members, directors, or officers
thereof execute an agreement binding them and the Firm for a period of
two years after such Adjustment Assistance is provided, to refrain from
employing, tendering any office or employment to, or retaining for
professional services any Person who, on the date such assistance or
any part thereof was provided, or within one year prior thereto, shall
have served as an officer, attorney, agent, or employee occupying a
position or engaging in activities which involved discretion with
respect to the provision of such Adjustment Assistance.
Subpart F--International Trade Commission Investigations
Sec. 315.15 Affirmative findings.
Whenever the International Trade Commission makes an affirmative
finding under section 202(b) of the Trade Act (19 U.S.C. 2252) that
increased imports are a substantial cause of serious injury or threat
thereof with respect to an industry, EDA will notify the TAACs and
provide expedited review of petitions and Adjustment Proposals from
Firms within the specified industry.
Dated: January 6, 2020.
John Fleming,
Assistant Secretary of Commerce for Economic Development.
[FR Doc. 2020-00453 Filed 2-13-20; 8:45 am]
BILLING CODE 3510-24-P
