cable minimum quantity set forth above unless requested in writing by the applicant, but in no case shall the quota share be greater than the quantity requested by the applicant.

(5) Notwithstanding any other provision of this regulation, a person who is not eligible for a historical license in excess of one percent of the total quota for an article in Group V of Appendix 1 from a country which has a Group V quota in Appendix 1, but has no such quota in Appendix 2, will be eligible to obtain a nonhistorical license to enter a quota share of such article, if such person (i) submits to the licensing authority (A) documents required under paragraph (b)(2)(i) and (ii) of § 6.25, and (b) documents indicating the importation of 5,000 pounds or more of such article free of quota during the period July 1, 1978 through June 30, 1979, and (ii) had submitted previously either (A) Customs forms 7501 and 7505, as requested by the Department on August 16, 1979 (44 FR 47969), or (B) an application for a historical quota share for an article in Group V of Appendix 1: Provided, That, the allocation of such nonhistorical quota shares will not reduce the size of the nonhistorical quota shares previously allocated for 1980. All submissions required under § 6.26(b)(5)(i) must be postmarked no later than (31 days after publication in the FEDERAL REGISTER) to be eligible for a 1980 nonhistorical quota share.

(c) Supplementary Licenses (pertaining only to articles in Appendix 2):

(1) Except in cases involving persons with historical eligibility who are seeking matching supplementary shares authorized under paragraph (c)(1)(ii) of § 6.25. A person with his or her affiliate(s) and associate(s) will be considered only as one person for the purpose of allocation of supplementary quota shares. No more than one supplementary quota share of an article from each specific country of origin listed for such article in Appendix 2 will be issued to any such person. No licensee with a historical license for a particular article in Appendix 2 from a particular country of origin, however, may receive more than one supplementary share in addition to the matching supplementary share(s) for

such article for which such person is eligible under paragraph (c)(2)(i) of this section. However, in cases where the Licensing Authority deems it necessary to make additional allocations in order to fully allocate a quota, such additional allocations may only be made after all eligible persons have been notified and given an opportunity to apply. Such notification will not be necessary for the reallocation of surrendered licenses covered by paragraph (e)(3) of this section.

(2) A supplementary quota share for an article in Appendix 2 from the EC will be determined on the following basis:

(i) Subject to paragraph (c)(1) of this section, the size of supplementary quota share issued to an eligible applicant for a specific article in Appendix 2 shall not exceed (A) for applicants who have historical quota shares in Appendix 2 from the EC for such article: an amount equal to the amount of the applicant's Appendix 2 historical quota share, or the amount of each supplementary quota share for such article allocated to applicants who have no Appendix 2 historical quota share for such article, whichever is larger; (B) for applicants who have no such historical quota shares: 110,000 pounds.

(ii) If, after applications for supplementary licenses have been evaluated and tabulated, the Licensing Authority determines that eligible applicants for shares of a particular quota for an article in Appendix 2 from the EC have appropriately requested amounts which together exceed the amount available for allocation, the Licensing Authority shall first assign quota shares of not less than the minimum share as indicated below to each applicant and then pro-rate the remaining portion of that available for allocation among them, based on each applicant's basic annual allocation for such quota in Appendix 2 from the EC, or on the minimum share assigned, whichever is greater. The minimum share shall be as follows:

(A) 5,000 pounds where the total poundage available for supplementary licenses is less than 500,000 pounds; (B) 20,000 pounds where the total poundage available for supplementary

licenses is over 500,000 pounds but less than 1,000,000 pounds;

(C) 36,000 pounds where the total poundage available for supplementary licenses is over 1,000,000 pounds.

(iii) If, after applications for supplementary licenses have been evaluated and tabulated, the Licensing Authority determines that the number of eligible applicants for a share of a quota for a particular article in Appendix 2 from the EC exceeds the number which could be assigned the minimum share each, the Licensing Authority may eliminate individual applications based on date of postmark and then, where necessary, other fair and equitable criteria. A single quota share for a particular article of less than the minimum may be issued, if appropriate, to facilitate full allocation of a particular quota.

(3) A supplementary quota share for an article in Appendix 2 from a particular country of origin other than the EC will be determined on the following basis:

(i) Eligible applicants whose applications have been endorsed in writing by an appropriate official of the government of the supplying country, which written endorsement is submitted directly from such government through appropriate channels to the Licensing Authority, shall receive first priority in allocation. Written endorsements shall also include the names and addresses of applicants endorsed and the quota article(s), including the amount(s), endorsed for each such applicant.

(ii) To the extent practicable, an eligible applicant whose application has been endorsed by the government of the supplying country as set forth in paragraph (c)(3)(i) of this section shall be awarded the full amount for which he or she has been endorsed. If eligible applicants whose applications have been endorsed by the government of the supplying country as set forth in paragraph (c)(3)(i) of this section request an aggregate amount of a specific quota from a specific country (not the EC) smaller than is available for allocation, or if no endorsement is made, the Licensing Authority shall allocate remaining portions among applicants who have not been endorsed,

following a procedure identical to that set forth in paragraph (c)(2) of this section for the EC, replacing, for this purpose, the words "the EC" wherever they appear with "a particular non-EC country."

(iii) If an endorsed licensee surrenders his or her endorsed quota share, or a portion thereof, under the provisions of paragraph (d)(2) of this section, the endorsing country may, by a new written endorsement, designate another importer for such portion or share.

(4) Supplementary quota shares for an article may not be smaller than the applicable minimum quantity set forth in paragraph (c)(2)(ii) unless requested in writing by the applicant, but in no case shall the quota share be greater than the quantity requested by the applicant.

(d) Temporary reduction of historical quota share. (1) Subject to provisions of paragraph (e) of this section, the historical quota share for any article in Appendix 1 or Appendix 2 which is not entered by its holder at the rate of 85 percent or more during a calendar year will be reduced in the following quota year, unless such licensee establishes that he or she was unable to enter such article due to reasons acceptable to the Licensing Authority. Such reduced historical quota share will be equal to the amount imported during the preceding quota year. If a historical license is not used by its holder in a given year, then the amount allocated to the holder for the following quota year shall be onequarter of the basic annual allocation of that license. Provided, That, once such reduced quota share has been established, the quota share of the licensee in the following quota year will be restored to its full basic annual allocation if the licensee enters 85 percent or more of the reduced quota share during the quota year when it was established. This paragraph applies to a licensee who receives any extra quota shares from other reduced licenses or reallocated portions. If less than 85 percent of the combined total of the license amount and the reallocated amount is used, then the licensee will be ineligible for reallocated portions and in some cases for extra quota

shares from other reduced licenses the following quota year whether or not the quota share in the following year is below the basic annual allocation for that license.

(2) Notwithstanding the above, a licensee may, in a letter postmarked no later than October 1 of a quota year, voluntarily surrender without penalty that portion of a historical quota share for any article in Appendix 1 or Appendix 2 which he or she does not intend to use. Any temporary reduction of a historical quota share will be based on the percentage used of that portion of such quota share which was not surrendered before October 1 of the preceding quota year.

(e) Temporary reallocation of quota shares. (1) Notwithstanding any other provisions of this regulation, to the extent that, between June 1 and October 1, it appears from information submitted to the Licensing Authority or otherwise, that all or part of a quota share of a particular licensee for an article from a particular country of origin will not be entered during that quota year, the Licensing Authority may require such licensee to submit in writing within a specified 21 day period a statement as to the amount of the unused portion of such quota share which will be used during the remainder of such quota year. In addition, such licensee may be required to submit copies of contracts, purchase orders or any other documentary evidence of intent to import against the unused portion of such quota share. If the licensee fails to submit such statement (including documentary evidence, if requested) within the specified period, the Licensing Authority may conclude that the unused portion of the quota share in question will not be used during the remainder of said quota year. On the basis of said statement, or if no statement is submitted, the Licensing Authority may reallocate all or part of the unused portion of such quota share.

(2) To the extent that the quota shares or portions thereof are surrendered under § 6.25(d)(3) (pertaining to nonhistorical and supplementary quota shares), § 6.26(d)(2), (pertaining to historical quota shares), or paragraph (e)(1) of this section by licens

ees for articles during a quota year, the quota shares for other licensees will be increased for such year as follows:

(i) Reallocation will be made among applying licensees from such article from such country of origin on the basis of the amounts requested by the applicants, unless the aggregate of the amounts requested exceeds the portion of the quota available for reallocation, in which case each applicant will be granted an appropriate minimum amount and any excess will then be allocated on the basis of the respective amounts of such articles entered by such licensees from such country of origin during the previous two quota years. However, no applicant may receive more than the amount he or she requests.

(ii) If, after a surrendered quota share is reallocated among licensees who hold a nonreduced license for such quota and apply for a portion of the reallocation, unallocated quantities of the quota still remain, such quantities may be allocated to other non-affiliated and non-associated applicants who have historical, nonhistorical or supplementary eligibility for any quota under the regulation for the remainder of the quota year in question. Quota shares allocated to such other applicants under this provision will be made in equal amounts of not less than 2,500 pounds each; except in the case of quota items the quota amounts for which are less than 10,000 pounds, which quota items will be allocated in equal shares of not less than 250 pounds each; except that no applicant will receive more than the amount requested in his or her application.

(3) Application for a reallocated portion will not be valid unless made in accordance with § 6.24 and postmarked during the period September 1-15 of the quota year in which reallocation is being considered.

(4) Any temporary reduction in a historical quota share (in accordance with paragraph (d) of this section) will be based on the percentage used of the portion of such quota share which was not surrendered for reallocation during the preceding quota year.

(o) "Enter" means to make entry, or withdrawal from warehouse, for consumption by deposit with, and acceptance by, the appropriate Customs officer of the properly executed entry documents, including invoices, bills of lading and payment of estimated duties.

(p) “Entire dairy products business" means the total assets and operations of the foreign and domestic aspects of a business pertaining to articles subject to the provisions of this regulation.

(q) "Entrepreneurial use" means the processing or sale of the article entered pursuant to the license as a part of the ordinary conduct of business by a licensee who is managing and assuming the risk of such business. Such term does not include one who is functioning as a mere supplier of license.

(r) "Licensee" means any person to whom a license has been issued under the regulation.

(s) "Licensing Authority" means the Head, Import Licensing Group, Dairy, Livestock and Poultry Division, Foreign Agricultural Service, U.S. Department of Agriculture, or in his or her absence the Import Quota Specialist, or any other officer or employee of the Department designated in writing as the Acting Head.

(t) "Other countries" refers to countries sharing a common quota which are not listed as having separate quotas in part 3 of the appendix to the Tariff Schedules of the United States, and for the purposes of the regulation are deemed as one country of origin.

(u) "Person" includes any individual, firm, corporation, partnership, association, or other legal entity. It also includes any national government (other than the Government of the United States and any agency thereof).

(v) "Postmark" means the postage cancellation mark applied by the U.S. Post Office showing the post office and date of mailing. This does not include metered postage affixed by the applicant or any other private entity.

(w) "Quota share" means that part of the annual quota of an article listed in Appendix 1 or Appendix 2 for which a person is eligible.

(x) "Quota year" means the 12month period beginning on January 1 of any given year.

(y) "Regulation" means the provisions contained in the Licensing Regulation of this subpart.

(z) "United States" means the Customs Territory of the United States, which is limited to the United States, District of Columbia and Puerto Rico. (Sec. 3, Pub. L. 80-897, 62 Stat. 1248, as amended (7 U.S.C. 624); Secs. 701, 703, Pub. L. 96-39, 93 Stat. 268, 272 (A.U.S.C. 1202 note); Part 3 of the appendix to the Tariff Schedules of the United States (19 U.S.C. 1202))

[44 FR 75596, Dec. 20, 1979, as amended at 45 FR 54302, Aug. 15, 1980; 46 FR 1660, Jan. 7, 1981]

§ 6.22 Prohibitions and restrictions on importers.

(a) No person may enter or cause to be entered any article listed in Appendix 1 or Appendix 2, except as provided in § 6.23 or as authorized by a license issued pursuant to this regulation.

(b) A person to whom a license has been issued hereunder is not relieved from compliance with any requirement of this regulation or any other applicable laws and regulations.

§ 6.23 Exceptions.

Licenses are not required for the entry of:

(a) Articles imported by or for the account of any agency of the U.S. Government.

(b) Articles with an aggregate value of not over $25 in any shipment, if imported as samples for taking orders, for the personal use of the importer, or for research.

(c) Articles imported for exhibition, display or sampling at a trade fair, or for research, if written approval of the Licensing Authority is obtained.

§ 6.24 Application for license.

Applications to the Licensing Authority for the issuance of licenses to enter articles must be made in writing, addressed to the Head, Dairy and Import Group, Dairy, Livestock and Poultry Division, Foreign Agricultural Service, U.S. Department of Agriculture, Washington, D.C. 20250. Each letter of application must state the article (including the Part 3 TSUS Appendix classification number), the country of origin of the article, and, in the case of supplementary and nonhistorical licenses or licenses for portions allocated under paragraph (e) § 6.26, the size of each quota share desired. Unpostmarked applications will not be approved by the Licensing Authority.

§ 6.25 Eligibility.

of

(a) Historical Eligibility. (1) Historical eligibility for licenses to enter quota shares of articles subject to quotas in effect as of November 22, 1978, the adjusted quantities of which are shown in Appendix 1, has already been determined.

(2) Historical eligibility for licenses to enter quota shares of articles under Group V of Appendix 2, which prior to January 1, 1980 were not subject to quota, will be established upon submission by the importer of copies of broker's copies of official consumption entry or warehouse withdrawal for consumption records, Customs forms 7501 and 7505, showing the applicant as the importer of record or importer of account for entries made during the period July 1, 1978 through June 30, 1979 of cheese, cheese product or substitutes for cheese falling under TSUS Nos. 117.6035 (Swiss or Emmenthaler), 117.6055, 117.7550, 117.8550 (GruyereProcess), 117.7560, 117.8560 except soft-ripened cheese (Other cheese, NSPF, except soft-ripened cheese), and 117.7570 and 117.8570 (Other cheese, Lowfat). Copies of other than the broker's copy will only be accepted if it is established that, for reasons satisfactory to the Licensing Authority, the broker's copy is not available. The Licensing Authority may also require a copy of the invoice or other documentation showing that the importer was the owner of the article at

the time entry was made and substantiating the type or variety of cheese entered. Such invoices should accompany an application for Appendix 2 historical licenses for TSUS items 117.7560 and 117.8560. Further, eligibility for articles in Group V(c) from "Other Countries" in Appendix 2 may be established only by importers who hold no other historical license for any article under Appendix 1 or Appendix 2 as of January 7, 1981. Applications for historical license for TSUS Appendix Item 950.10D from "Other Countries" in Appendix 2 must be postmarked no later than February 11, 1981.

(3) Historical eligibility for license to enter a quota share of an article under Group II, III, or IV of Appendix 2 from a particular country of origin may be acquired only by persons eligible for a historical license to enter such article from such country of origin under Appendix 1.

(b) Nonhistorical eligibility. (1) Any person, who is not eligible under paragraph (a) of this section to receive a historical license to enter a particular article in Appendix 1 or Appendix 2, or has voluntarily surrendered such eligibility, who meets the requirements of this paragraph, will be eligible to obtain a nonhistorical license to enter a quota share of such article in Appendix 1.

(2) Nonhistorical eligibility for specific articles listed in Appendix 1 will be established upon submission of:

(i) A notarized certification sworn to by the applicant under penalty of perjury stating that: (A) Such person intends to be regularly engaged, during the period covered by the license(s) for which application is made, in the business of manufacturing within the United States or entering such articles for his or her own entrepreneurial use and for this purpose will maintain a bonafide business office within the United States and have a person, principal or resident agent upon whom service of judicial process may be made; (B) such person intends to use any article entered pursuant to a license obtained hereunder in actual commerce and, when required will submit proof demonstrating the use to which licenses and the articles entered

90-007 0-82--12