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Rules and Regulations                                                                        Federal Register
                                                                                             Vol. 63, No. 54

                                                                                             Friday, March 20, 1998

This section of the FEDERAL REGISTER            than 50 percent of a historical license is   Surrenders of historical licenses for EU
contains regulatory documents having general    surrendered in at least three of the five    cheese accounted for over 60 percent of
applicability and legal effect, most of which   prior quota years (i.e., 2001–2005), that    1997 historical license surrenders of
are keyed to and codified in the Code of        license will be issued in an amount          12,302 metric tons. In previous years,
Federal Regulations, which is published under   equal to the average amount entered in       historical license surrenders were based,
50 titles pursuant to 44 U.S.C. 1510.
                                                those years. FAS has determined that a       in part, on supply shortages and
The Code of Federal Regulations is sold by      principal underlying cause of changing       currency situations. However, the 1997
the Superintendent of Documents. Prices of      U.S. import market conditions is the         increase in historical license surrenders
new books are listed in the first FEDERAL       European Union’s (the EU’s) progressive      can be attributed principally to the EU’s
REGISTER issue of each week.                    implementation of its Uruguay Round          implementation of its Uruguay Round
                                                export subsidy reduction commitment          commitment to reduce the quantity of
                                                which, in quota year 1997, began to          cheese exported under subsidy.
DEPARTMENT OF AGRICULTURE                       have a direct impact on trade flows of          Under Uruguay Round export subsidy
                                                EU cheese to the U.S. market resulting       disciplines, the EU’s export subsidy
Office of the Secretary                         in reduced U.S. imports and increased        ceiling for cheese is scheduled to
7 CFR Part 6                                    historical license surrenders. FAS has       decrease each fiscal year (FY) from
                                                further determined that a five-year          426,500 tons in FY 1995 (July-June) to
Dairy Tariff-Rate Import Quota                  suspension of the historical license         321,300 tons in FY 2000. The EU
Licensing                                       reduction requirement, until the             administers its export subsidy reduction
                                                Uruguay Round export subsidy                 program by setting monthly export
AGENCY:  Office of the Secretary, USDA.         reductions are completed in the year         subsidy allocations equal to prorated
ACTION: Determination on historical             2000, is warranted under § 6.25(b)(2) to     amounts of the annual export subsidy
license reductions.                             allow time for historical licensees to       ceiling, and issuing export licenses for
                                                adjust to changing U.S. import market        subsidized cheese shipments by
SUMMARY: The Department of
                                                conditions.                                  destination. In October 1997, to avoid
Agriculture has determined that                                                              exceeding its export subsidy limit, the
provisions of the Dairy Tariff-Rate             Backgound
                                                                                             EU adjusted subsidies for various
Import Quota Licensing Regulation with            The Dairy Tariff-Rate Import Quota         cheeses and lowered subsidies by 20
respect to the issuance of reduced              Licensing Regulation at 7 CFR 6.25(b)(2)     percent for cheese exports destined for
historical import licenses based on             provides that prior to 1999, the             the United States. EU subsidy cuts
license surrenders of more than 50              Secretary of Agriculture may determine       during the 1997 quota year were
percent will be suspended, in light of          that the requirements in §§ 6.25(b)(1)(i)    sufficient to raise EU prices of various
market conditions, and shall not apply          and 6.25(b)(1)(ii) to reduce permanently     cheeses to levels that impeded EU
for a period of five years.                     the quantity of historical license based     cheese sales to U.S. historical licenses.
DATES: Effective March 20, 1998, 7 CFR          on license surrenders of more than 50        In particular, prices of EU industrial-
6.25(b)(1)(i) and (b)(1)(ii) are suspended.     percent in three consecutive quota years     grade cheeses rose above U.S. prices for
FOR FURTHER INFORMATION CONTACT:                or three out of five quota years, ‘‘shall    comparable cheese (i.e., domestic barrel
Diana Wanamaker, Group Leader,                  not apply in light of market conditions.’’   Cheddar cheese), thereby removing the
Import Policies and Programs Division,          The Department requested public              economic incentive to import. In
Foreign Agricultural Service, 1400              comments in a notice of proposed             addition to EU export subsidy
Independence Avenue, SW., Stop 1029,            rulemaking published on October 15,          reductions, the 1998 merger of the
Washington, DC 20250–1029 or                    1997 (62 FR 53580–81 and 62 FR               license allocations for Austria, Finland,
telephone (202) 720–2916.                       55184), on possible options for the          and Sweden into an EU–15 allocation
SUPPLEMENTARY INFORMATION:                      implementation of the historical license     added approximately 21,000 metric tons
   Determination: The Foreign                   reduction requirement, including             of EU historical licenses for cheese.
Agricultural Service (FAS), under a             possible recision, suspension, or delay         In view of rapid and significant
delegation of authority from the                of this requirement, and requested           changes in U.S. import market
Secretary of Agriculture, 7 CFR 2.43, has       comments on current dairy import             conditions for EU cheeses beginning in
determined pursuant to 7 CFR                    market conditions that should be             1997, FAS has determined that
6.25(b)(2), to suspend the historical           considered with respect to                   temporary suspension of the historical
license reduction provisions of 7 CFR           implementation of § 6.25(b)(2). Public       license reduction requirement is
6.25(b)(1)(i) and 6.25(b)(1)(ii) for a five-    comments were submitted by 37 entities       justified through the year 2000. The
year period, in light of U.S. import            during the comment period from               overriding purpose of the five-year
market conditions for cheese. At the end        October 15, 1997, to November 28, 1997.      suspension is to provide adequate time
of the five-year suspension, beginning in         Historical License Surrenders and          for historical licensees of EU cheeses to
quota year 2004, if more than 50 percent        Market Conditions: In 1997, surrenders       adjust to changing market conditions, to
of a historical license is surrendered in       of historical licenses for cheese, in        find alternative suppliers of cheese in
each of the three prior quota years (i.e.,      which the quantity surrendered               the EU, and to develop new markets to
2001–2003), that license will be issued         exceeded 50 percent of a license             enable importers to fully utilize their
in an amount equal to the average               amount, reached 12,302 metric tons;          historical licenses for EU cheese. The
amount entered in those years.                  compared to 1,980 metric tons in 1996,       suspension is consistent with the intent
Beginning in quota year 2006, if more           and 5,163 metric tons in 1995.               of the U.S.-EU Uruguay Round bilateral
13482             Federal Register / Vol. 63, No. 54 / Friday, March 20, 1998 / Rules and Regulations

agreement on maximizing utilization of       DEPARTMENT OF AGRICULTURE                    exportation in bond, in accordance with
U.S. licenses for EU cheese.                                                              7 CFR part 352; or (3) into Guam, in
                                             Animal and Plant Health Inspection           accordance with § 319.37–4(b).
   Summary of Public Comments:
                                             Service                                         ‘‘Subpart—Nursery Stock, Plants,
Comments, views, and
                                                                                          Roots, Bulbs, Seeds, and Other Plant
recommendations were submitted by 32         7 CFR Part 319                               Products’’ (referred to below as
importers holding historical licenses;                                                    ‘‘Subpart—Nursery Stock’’), contained
                                             [Docket No. 96–082–2]
three members of Congress; and two                                                        in 7 CFR 319.37 through 319.37–14,
trade associations. Submissions by most      Bamboo                                       regulates the importation into the
historical licensees stressed that                                                        United States of most other propagative
substantial business investments rely on     AGENCY:  Animal and Plant Health             plant material. Regulated articles are
historical import licenses, and              Inspection Service, USDA.                    designated as either prohibited or
permanent reductions can cause               ACTION: Final rule.                          restricted.
significant harm to employees,               SUMMARY:    We are consolidating the            On September 11, 1997, we published
distributors, customers, and the survival    regulations pertaining to the                in the Federal Register (62 FR 47770–
of many businesses. Most historical          importation of bamboo, contained in          47772, Docket No. 96–082–1) a proposal
licensees supported immediate                ‘‘Subpart—Bamboo Capable of                  to consolidate ‘‘Subpart—Bamboo
elimination of the historical license        Propagation,’’ and the regulations           Capable of Propagation’’ and ‘‘Subpart—
reduction requirement. Certain other         pertaining to propagative material in        Nursery Stock’’ by adding bamboo seed,
historical licensees supported either: (1)                                                bamboo plants, and bamboo cuttings
                                             general, contained in ‘‘Subpart—
the permanent reduction and                                                               capable of propagation, except those
                                             Nursery Stock, Plants, Roots, Bulbs,
reallocation of historical licenses in                                                    imported into Guam, to the list of
                                             Seeds, and Other Plant Products.’’ This
                                                                                          prohibited articles in § 319.37(a). In
order to provide new entrants and            change will simplify and clarify our
                                                                                          conjunction with this action, we
growing businesses a greater                 regulations. We are also amending the
                                                                                          proposed to remove ‘‘Subpart—Bamboo
opportunity to import cheese; or (2)         regulations in ‘‘Subpart—Fruits and
                                                                                          Capable of Propagation’’ and all
postponement of the historical license       Vegetables’’ to add provisions allowing
                                                                                          references to § 319.34 contained in part
reduction requirement to provide time        fresh bamboo shoots without leaves or
for adjustment to and analysis of            roots to be imported into the United            Under this proposal, bamboo seeds,
changing market conditions. Comments         States from various countries for            bamboo plants, and bamboo cuttings
submitted by the members of Congress         consumption. This action is based on         capable of propagation would have
and trade associations favored               assessments that indicate that bamboo        continued to be eligible for importation
elimination of the historical license        shoots without leaves or roots may be        into Guam as restricted articles. (The
reduction requirement based on market        imported into the United States from         term restricted article is defined in
conditions.                                  certain countries without a significant      § 319.37–1 of ‘‘Subpart—Nursery Stock’’
                                             risk of introducing plant pests.             as any class of nursery stock or other
   With respect to market conditions, the    EFFECTIVE DATE: April 20, 1998.              class of plant, root, bulb, seed, or other
members of Congress stated that, under       FOR FURTHER INFORMATION CONTACT: Mr.         plant product for, or capable of,
current circumstances, surrenders of         James Petit de Mange, Staff Officer,         propagation, excluding any prohibited
historical licenses result from market       Phytosanitary Issues Management Team,        articles listed in § 319.37–2 (a) or (b) of
conditions beyond an importer’s              PPQ, APHIS, 4700 River Road Unit 140,        ‘‘Subpart—Nursery Stock,’’ and
control. Historical licensees and the        Riverdale, MD 20737–1231, telephone          excluding any articles regulated under
trade associations identified the            (301) 734–6799; or e-mail                    other subparts of part 319.)
following market conditions as causes of                        The importation of bamboo seeds,
historical license surrenders: (1) lack of   SUPPLEMENTARY INFORMATION:                   bamboo plants, and bamboo cuttings for
exportable supply; (2) non-competitive                                                    experimental or scientific purposes by
foreign prices (resulting in some cases      Background                                   the United States Department of
from foreign export administration              The regulations at 7 CFR part 319         Agriculture also would not have been
decisions, and currency fluctuations);       prohibit or restrict the importation of      affected by this change. In ‘‘Subpart—
(3) low-quality or high-priced foreign       plants, plant parts, and related materials   Nursery Stock,’’ § 319.37–2(c) provides
products; and (4) foreign export             to prevent the introduction of foreign       that any article listed as a prohibited
monopolies which can affect license          plant pests into the United States.          article in § 319.37(a) may be imported
utilization through supply and price            The importation into the United           for experimental or scientific purposes
controls.                                    States of any variety of bamboo seed,        by the Department of Agriculture.
                                             bamboo plants, and bamboo cuttings              In addition, bamboo seeds, bamboo
  Signed at Washington, D.C. on March 13,    capable of propagation, including all        plants, and bamboo cuttings capable of
1998.                                        genera and species of the tribe              propagation would have continued to be
Timothy J. Galvin,                           Bambuseae, has been regulated under          eligible for movement through the
Acting Administrator, Foreign Agricultural   ‘‘Subpart— Bamboo Capable of                 United States for export, or for
Service.                                     Propagation,’’ contained in 7 CFR            transportation and exportation in bond,
[FR Doc. 98–7171 Filed 3–19–98; 8:45 am]     319.34. Section 319.34(a) provides that      in accordance with 7 CFR part 352. The
                                             all varieties of bamboo seeds, bamboo        regulations at 7 CFR part 352, ‘‘Plant
                                             plants, and bamboo cuttings capable of       Quarantine Safeguard Regulations,’’
                                             propagation are prohibited importation       allow plants and plant parts that are not
                                             into the United States unless they are       eligible for entry into the United States
                                             imported: (1) For experimental or            to move through the United States for
                                             scientific purposes by the United States     export to other countries under
                                             Department of Agriculture; (2) for           safeguards intended to prevent the
                                             export, or for transportation and            introduction of plant pests.