Sheep and Wool Promotion, Research, Education, and Information Order

DEPARTMENT OF AGRICULTURE

7 CFR Part 1280

[No. LS-94-015]

Sheep and Wool Promotion, Research, Education, and Information

Order

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: This rule establishes a Sheep and Wool Promotion, Research,

Education, and Information Order (Order) which is authorized by the

Sheep Promotion, Research, and Information Act of 1994 (Act). The

program will be funded by assessments collected from sheep producers,

sheep feeders and importers of sheep and sheep products. The program

will be administered by a National Sheep Promotion, Research, and

Information Board (Board).

Implementing regulations will be published separately in the

Federal Register.

EFFECTIVE DATE: This final rule is effective May 3, 1996, except that

Sec. 1280.224-1280.228 become effective July 1, 1996.

ADDRESSES: Ralph L. Tapp, Chief; Marketing Programs Branch, Room 2606-

S; Livestock and Seed Division, AMS-USDA; P.O. Box 96456; Washington,

D.C. 20090-6456.

FOR FURTHER INFORMATION CONTACT: Ralph L. Tapp, Chief, Marketing

Programs Branch, 202/720-1115.

SUPPLEMENTARY INFORMATION: Prior documents: Notice-Invitation to submit

proposals published January 4, 1995 (60 FR 381); Proposed Rule-Sheep

and Wool Promotion, Research, Education, and Information Order

published June 2, 1995 (60 FR 28747); Proposed Rule-Procedures for

Conduct of Referendum published August 8, 1995 (60 FR 40313); Notice-

Certification of Organizations for Eligibility to Make Nominations to

the Proposed Board published August 8, 1995 (60 FR 40343); Proposed

Rule-Rules and Regulations published October 3, 1995 (60 FR 51737);

Proposed Rule-Sheep and Wool Promotion, Research, Education, and

Information Order published December 5, 1995 (60 FR 62298); and Final

Rule and Referendum Order-Procedures for the Conduct of Referendum

published December 15, 1995 (60 FR 64297).

Regulatory Impact Analysis

Executive Orders 12866 and 12778 and the Regulatory Flexibility Act

This final rule has been determined to be not significant for

purposes of Executive Order 12866 and therefore has not been reviewed

by the Office of Management and Budget (OMB).

This final rule was reviewed under Executive Order 12778, Civil

Justice Reform. It is not intended to have a retroactive effect. This

rule would not preempt any State or local laws, regulations, or

policies unless they present an irreconcilable conflict with this rule.

The Act provides that any person subject to the Order may file with

the Secretary a petition stating that the Order, any provision of the

Order, or any obligation imposed in connection with the Order is not in

accordance with the law, and requesting a modification of the Order or

an exemption from certain provisions or obligations of the Order. The

petitioner would have the opportunity for a hearing on the petition.

Thereafter the Secretary would issue a decision on the petition. The

Act provides that the district court of the United States in the

district in which the petitioner resides or carries on business has

jurisdiction to review the Secretary's decision, if the petitioner

files a complaint for that purpose not later than 20 days after the

date of the entry of the decision. The petitioner must exhaust his or

her administrative remedies before filing such a complaint in the

district court.

Pursuant to requirements set forth in the Regulatory Flexibility

Act (RFA) (5 U.S.C. 601 et seq.), AMS has considered the economic

impact of this final action on small entities.

The purpose of RFA is to fit regulatory actions to the scale of the

businesses that are subject to such actions so that small businesses

would not be unduly or disproportionately burdened.

According to the January 27, 1995, issue of ``Sheep and Goats,''

published by the Department's National Agricultural Statistics Service,

there are approximately 87,350 sheep operations in the United States,

nearly all of which would be classified as small businesses under the

criteria established by the Small Business Administration (13 CFR

Sec. 121.601). Additionally, there are approximately 9,000 importers of

sheep and sheep products, nearly all of which would be classified as

small businesses.

This final Order will require each person who makes payment to a

sheep producer, feeder, or handler of sheep or sheep products to be a

collecting person, and to collect an assessment from that sheep

producer, feeder, or handler of sheep or sheep products. Any person who

buys domestic live sheep or greasy wool for processing must also

collect the assessment and remit it to the Board. Each person who

processes or causes to be processed sheep or sheep products of that

person's own production and who markets the processed products will pay

an assessment and remit the assessment to the Board. Any person who

exports live sheep or greasy wool will be required to remit an

assessment to the Board. Finally, each person who imports into the

United States sheep, sheep products, wool, or wool products, other than

raw

[[Page 19515]]

wool, will pay an assessment. The U.S. Customs Service (Customs) will

collect the assessments on imported sheep and sheep products (except

raw wool) and forward them to AMS for disbursement to the Board.

The rate of assessment on domestic sheep producers, feeders, and

exporters of live sheep and greasy wool will be 1 cent per pound on

live sheep sold and 2 cents per pound on greasy wool sold. Importers

will be assessed 1 cent per pound on live sheep and the equivalent of 1

cent per pound of live sheep for sheep products and 2 cents per pound

of degreased wool or the equivalent of degreased wool for wool and wool

products. Imported raw wool will be exempt from assessments. Each

person who processes or causes to be processed sheep or sheep products

of that person's own production and markets the processed products will

be assessed the equivalent of 1 cent per pound of live sheep sold and 2

cents per pound of greasy wool sold. All assessment rates may be

adjusted in accordance with the applicable provisions of the Act.

Paperwork Reduction

In accordance with the Paperwork Reduction Act of 1980 (44 U.S.C.

Chapter 35), the information collection requirements contained herein

were submitted to OMB for approval and assigned OMB No. 0581-0093. This

action sets forth the provisions for establishing a nationwide,

industry-funded sheep and wool promotion, research, education, and

information program. The information collection requirements required

by this action and necessary for the implementation of this Order

include:

(1) A report by each collecting person required to remit

assessments to the Board for live sheep or greasy wool purchased from

the producer, feeder, or handler of sheep or sheep products; by each

person marketing sheep or sheep products of that person's own

production; and by each exporter of sheep or greasy wool. The estimated

number of respondents for this report is 700. Each respondent would

submit one report per month, unless otherwise prescribed by the Board,

and the estimated average reporting burden is 0.5 hours per response;

(2) A requirement to maintain sufficient records to verify reports

submitted under the Order. The estimated number of recordkeepers needed

to comply with this requirement is 700, each of whom would have an

estimated annual reporting burden of 0.5 hours;

(3) An application for certification of organization, to be

completed by eligible organizations that request certification in order

to be eligible to nominate producers, feeders, and importers to the

Board. The estimated number of respondents is 70 (with each submitting

one response), and the estimated average reporting burden is 0.5 hour

per response;

(4) A nomination form by which certified organizations will

nominate producers, feeders, and importers for membership on the Board.

The estimated number of respondents is 60 for the first year of the

Order, and 20 each year thereafter. Each respondent would submit one

response per year, and the estimated average reporting burden is 0.5

hour per response; and

(5) An advisory committee membership background information form,

to be completed by candidates nominated by certified organizations for

appointment to the Board. The estimated number of respondents is 240

during the first year of the Order, and 80 each year thereafter. Each

respondent would submit one response per year, and the estimated

average reporting burden is 0.5 hour per response.

Background

The Act (7 U.S.C. 7101-7111), enacted October 22, 1994, authorizes

the Secretary to establish a national sheep and wool promotion,

research, education, and information program. The program will be

funded by a mandatory assessment on domestic sheep producers, sheep

feeders, and exporters of live sheep and greasy wool of 1 cent per

pound on live sheep sold and 2 cents per pound on greasy wool sold.

Importers will be assessed 1 cent per pound on live sheep imported and

the equivalent of 1 cent per pound of live sheep for sheep products

imported and 2 cents per pound of degreased wool or the equivalent of

degreased wool for wool and wool products imported. Imported raw wool

will be exempt from assessments. Each person who processes or causes to

be processed sheep or sheep products of that person's own production,

and who markets the processed products, will be assessed the equivalent

of 1 cent per pound of live sheep sold and 2 cents per pound of greasy

wool sold. All assessment rates may be adjusted in accordance with

applicable provisions of the Act.

The Act provides for the submission of proposals for a Sheep and

Wool Promotion, Research, Education, and Information Order (Order). The

Secretary may propose the issuance of an Order, or an association of

sheep producers may submit and request the issuance of an Order. The

Act provides that when the Secretary decides to propose an Order or

receives a request and proposal for an Order, the Secretary shall

publish the proposed Order and give due notice and opportunity for

public comment. The Act further provides that an order contain certain

specified terms and conditions. Such terms and conditions included

provisions concerning the establishment of and composition of a Board

and the powers and duties of such a Board. Also included under terms

and conditions are provisions concerning plans and budgets, contracts

and agreements, books and records of the Board, assessments,

prohibitions, and reports, books, and records of collecting persons

required to remit assessments and each person required to collect the

assessment pursuant to the Act and the Order.

As established by the Act, the Order provides for the establishment

of a Board comprised of 85 sheep producers, 10 sheep feeders, and 25

importers of sheep and sheep products. The Act further provides that

any State with one producer member may have an alternate producer

member.

The Department issued an invitation to submit proposals for an

initial Order in the January 4, 1995, (60 FR 381) issue of the Federal

Register. In response to that invitation, the American Sheep Industry

Association (ASI), the sheep industry's producer member organization,

submitted a proposed Order. In addition, the New Zealand Meat Producers

Board, the Australian Meat and Live-stock Corporation, the Wools of New

Zealand, the National Lamb Feeders Association, and the Lamb Committee

of the National Livestock and Meat Board each submitted a partial

proposal.

The Department also received letters from other interested parties.

The Department did not consider these letters to be proposals because

they primarily addressed information related to provisions of the Act

itself.

The Department published ASI's proposal as Proposal I, the New

Zealand Meat Producers Board's proposal as Proposal II, the Australian

Meat and Live-stock Corporation's proposal as Proposal III, the Wools

of New Zealand's proposal as Proposal IV, and the National Lamb Feeders

Association's proposal as Proposal V. The Department modified these

proposals slightly in order to (1) make them consistent with the Act

and other similar national research and promotion programs supervised

by the Department, (2) simplify the language and format of some

provisions, and (3) add certain sections necessary for the proper

administration of the Order by the

[[Page 19516]]

Department. The Department rejected the proposal submitted by the Lamb

Committee of the National Livestock and Meat Board and discussed that

proposal in the proposed rule. Each proposal was published in the June

2, 1995, issue of the Federal Register (60 FR 28747). Interested

persons were invited to submit comments on the proposals until July 17,

1995. On June 26, 1995, a public meeting was held at the Department to

afford any interested person the opportunity to comment on the proposed

Order.

The Department received 137 written comments concerning the

proposed Order from individual sheep producers, sheep feeders,

importers of sheep and sheep products, State sheep producer

organizations, general farm organizations, universities, and other

interested parties. Ninety-three comments were filed on time and forty-

four comments were filed after the comment period closed. The comments

on the proposed Order were discussed in the December 5, 1995, issue of

the Federal Register (60 FR 62298). A nationwide referendum was held on

February 6, 1996, among eligible producers, feeders, and importers to

determine whether the Order would become effective. Requests for

absentee ballots were available from January 16, 1996, through January

26, 1996. An Order becomes effective only if the Secretary determines

that the Order has been approved by not less than a majority of the

producers, feeders, and importers voting in the referendum or at least

two-thirds of the production represented by persons voting in the

referendum. The Order was approved by a majority of those persons

voting in the referendum.

The Order provisions as proposed by the Department and approved in

the referendum are summarized as follows:

Sections 1280.101-1280.136 of the Order define certain words that

are used in the Order.

Sections 1280.201-1280.211 of the Order concern the establishment,

membership, nominations, method of obtaining nominations, certification

of organizations, term of office, compensation, removal, and powers and

duties of the Board, which is the governing body authorized to

administer the Order subject to the oversight of the Secretary.

Sections 1280.212-1280.214 of the Order provide for budget review

and approval, maintenance of books and records by the Board, and the

investment of funds.

Section 1280.215 of the Order authorizes the use of assessments

which includes expenditures of funds for domestic country of origin

specific promotion and reimbursement for expenses incurred for the

Department's oversight responsibilities.

Sections 1280.216-1280.222 of the Order establish that the

membership of the Executive Committee will be composed of 14 members,

including 7 producer members elected from 7 regions reflecting sheep

production and sheep producers, 1 sheep feeder, 3 importers of sheep or

sheep products, and 3 elected officers of the Board. In addition, these

sections authorize the Executive Committee to develop plans and

projects of promotion, research, consumer information, education,

industry information, and producer information with respect to sheep

and sheep products and to develop and submit to the Board budgets of

anticipated expenses and disbursements for program projects. The

Secretary must approve such plans, projects, or budgets before they are

implemented.

Section 1280.223 of the Order holds the Board responsible for

expenses of the Board and the Executive Committee, and establish

requirements for contracts and agreements that the Board enters into.

Sections 1280.224-1280.228 establish assessment rates on sheep and

sheep products as provided by the Act. These sections also provide that

the domestic rate and the import rate must be raised or lowered

simultaneously by an equivalent amount.

Section 1280.229 authorizes each Qualified State Sheep Board (QSSB)

to receive 20 percent of the total assessments collected by the Board

on the marketing of domestic sheep and domestic sheep products in any

one year from each State. However, no QSSB will receive less than

$2,500 per year.

Section 1280.230 of the Order establishes collection procedures for

each person responsible for collecting the assessment, fixes a 2

percent late payment charge for past due assessments, and authorizes

the Secretary to receive assessments on behalf of the Board, if the

Board is not in place or is otherwise unable to collect assessments.

Section 1280.231 of the Order prohibits funds received under this

program from being used to influence Government action or policy, with

certain specified exceptions. In addition, funds received under this

program that are used to conduct plans or projects shall not (1) make

false or misleading claims on behalf of sheep or sheep products or

against a competing product or (2) promote or advertise any sheep or

sheep products by brand or trade name without the approval of the Board

and the concurrence of the Secretary.

Sections 1280.232-1280.235 of the Order contain reporting and

recordkeeping requirements for persons subject to the Order, and

provide that all information obtained by the Board or the Department

from books and reports required by the Order would be kept

confidential. A correction is made to Sec. 1280.235(d) by deleting the

word ``subpart'' and inserting in its place the word ``section.''

Sections 1280.240-1280.246 of the Order contain miscellaneous

provisions, including provisions concerning the Secretary's authority;

proceedings after the termination of the Order; the effect of

termination or amendment of the Order; personal liability of Board

members; patents, copyrights, inventions and publications; amendments

to the Order; and separability of Order provisions.

On February 6, 1996, a nationwide referendum was conducted among

eligible sheep producers, sheep feeders, and importers of sheep and

sheep products to determine whether the Order should become effective.

Requests for absentee ballots were available from January 16, 1996,

through January 26, 1996. The representative period for establishing

voter eligibility was from January 1, 1994, through December 31, 1994.

It is determined that a majority of those persons who voted in the

referendum approved the implementation of the Order. To become

effective, the Order had to be approved either by a simple majority

vote or by those persons voting in the referendum who accounted for at

least two-thirds of the production voted.

After consideration of all relevant material presented, including

the initial proposals, comments received, the referendum results, and

other available information, it is found that the Order and all of the

terms and conditions thereof, should be made final.

Pursuant to 5 U.S.C. 553, it is also found and determined that good

cause exists for not postponing the effective date of this action until

30 days after publication in the Federal Register. Each section of this

final rule except, Sec. 1280.224 through Sec. 1280.228 which establish

assessment rates on both domestic and imported sheep and sheep products

as provided by the Act, will become effective upon publication of this

final rule. Sections 1280.224-1280.228 of the Order will become

effective July 1, 1996, after regulations implementing the collection

and remittance procedures are issued and published in the Federal

Register.

[[Page 19517]]

Accordingly, no useful purpose would be served in delaying the

effective date of the other provisions of the Order. The Act requires

implementation of the Order if the Order is approved by the sheep and

wool industry and the sheep and wool industry approved the Order in the

February 6, 1996, referendum. Further, the Board must be appointed to

administer the program as soon as possible. Therefore, this final rule

is effective on the day following date of publication in the Federal

Register except for the provisions in Sec. 1280.224-Sec. 1280.228.

List of Subjects in 7 CFR Part 1280

Administrative practice and procedure, Advertising, Agricultural

research, Marketing agreements, Sheep and sheep products, Reporting and

recordkeeping requirements.

For the reasons set forth in the preamble, 7 CFR Part 1280 of the

Code of Federal Regulations is amended as follows:

PART 1280--SHEEP PROMOTION, RESEARCH, AND INFORMATION

1. The authority citation for Part 1280 continues to read as

follows:

Authority: 7 U.S.C. 7101-7111.

2. In Part 1280, Subpart A is added to read as follows:

Subpart A--Sheep and Wool Promotion, Research, Education, and

Information Order

Definitions

Sec

1280.101 Act.

1280.102 Board.

1280.103 Carbonized wool.

1280.104 Certified organization.

1280.105 Collecting person.

1280.106 Consumer information.

1280.107 Customs Service.

1280.108 Degreased wool.

1280.109 Department.

1280.110 Education.

1280.111 Executive committee.

1280.112 Exporter.

1280.113 Feeder.

1280.114 Greasy wool.

1280.115 Handler.

1280.116 Importer.

1280.117 Industry information.

1280.118 National feeder organization.

1280.119 Part and subpart.

1280.120 Person.

1280.121 Processor.

1280.122 Producer.

1280.123 Producer information.

1280.124 Promotion.

1280.125 Pulled wool.

1280.126 Qualified State Sheep Board.

1280.127 Raw wool.

1280.128 Research.

1280.129 Secretary.

1280.130 Sheep.

1280.131 Sheep products.

1280.132 State.

1280.133 Unit.

1280.134 United States.

1280.135 Wool.

1280.136 Wool products.

National Sheep Promotion, Research, and Information Board

1280.201 Establishment and membership of the Board.

1280.202 Nominations.

1280.203 Nominee's agreement to serve.

1280.204 Appointment.

1280.205 Method of obtaining nominations.

1280.206 Vacancies.

1280.207 Certification of organizations.

1280.208 Term of office.

1280.209 Compensation.

1280.210 Removal.

1280.211 Powers and duties of the Board.

1280.212 Budgets.

1280.213 Books and records of the Board.

1280.214 Investment of funds.

1280.215 Use of assessments.

Executive Committee

1280.216 Establishment.

1280.217 Membership.

1280.218 Powers and duties.

1280.219 Term of office.

1280.220 Chairperson.

1280.221 Quorum.

1280.222 Vacancies.

Expenses

1280.223 Expenses.

Assessments

1280.224 Sheep purchases.

1280.225 Wool purchases.

1280.226 Direct processing.

1280.227 Export.

1280.228 Imports.

1280.229 Qualified State Sheep Board.

1280.230 Collection.

1280.231 Prohibition on use of funds.

Reports, Books, and Records

1280.232 Reports.

1280.233 Books and records.

1280.234 Use of information.

1280.235 Confidentiality.

Miscellaneous

1280.240 Right of the Secretary.

1280.241 Proceedings after termination.

1280.242 Effect of termination or amendment.

1280.243 Personal liability.

1280.244 Patents, copyrights, invention, and publication.

1280.245 Amendments.

1280.246 Separability.

Subpart A--Sheep and Wool Promotion, Research, Education, and

Information Order

Definitions

Sec. 1280.101 Act.

The term Act means the Sheep Promotion, Research, and Information

Act of 1994, 7 U.S.C. 7101-7111; Public Law No. 103-107; 108 Statute

4210, enacted October 22, 1994, and any amendments thereto.

Sec. 1280.102 Board.

The term Board means the National Sheep Promotion, Research, and

Information Board established pursuant to Sec. 1280.201.

Sec. 1280.103 Carbonized wool.

The term carbonized wool means wool that has been immersed in a

bath, usually of mineral acids or acid salts, that destroys vegetable

matter in the wool, but does not affect the wool fibers.

Sec. 1280.104 Certified organization.

The term certified organization means any organization that has

been certified by the Secretary pursuant to this part as being eligible

to submit nominations for membership on the Board.

Sec. 1280.105 Collecting person.

The term collecting person means any person who is responsible for

collecting an assessment pursuant to the Act, this subpart and

regulations prescribed by the Board and approved by the Secretary,

including processors and any other persons who are required to remit

assessments to the Board pursuant to this part, except that a

collecting person who is a market agency; i.e., commission merchant,

auction market, or livestock market in the business of receiving such

sheep or sheep products for sale on commission for or on behalf of a

producer or feeder shall pass the collected assessments on to the

subsequent purchaser pursuant to the Act, this subpart and the

regulations prescribed by the Board and approved by the Secretary.

Sec. 1280.106 Consumer information.

The term consumer information means nutritional data and other

information that would assist consumers and other persons in making

evaluations and decisions regarding the purchase, preparation, or use

of sheep products.

Sec. 1280.107 Customs Service.

The term Customs Service means the U.S. Customs Service of the

Department of the Treasury.

Sec. 1280.108 Degreased wool.

The term degreased wool means wool from which the bulk of

impurities has been removed by processing.

Sec. 1280.109 Department.

The term Department means the U.S. Department of Agriculture.

Sec. 1280.110 Education.

The term education means activities providing information relating

to the sheep industry or sheep products to producers, feeders,

importers, consumers, and other persons.

[[Page 19518]]

Sec. 1280.111 Executive Committee.

The term Executive Committee means the Executive Committee of the

Board established under Sec. 1280.216.

Sec. 1280.112 Exporter.

The term exporter means any person who exports domestic live sheep

or greasy wool from the United States.

Sec. 1280.113 Feeder.

The term feeder means any person who feeds lambs until the lambs

reach slaughter weight.

Sec. 1280.114 Greasy wool.

The term greasy wool means wool that has not been washed or

otherwise cleaned.

Sec. 1280.115 Handler.

The term handler means any person who purchases and markets greasy

wool.

Sec. 1280.116 Importer.

The term importer means any person who imports sheep or sheep

products into the United States.

Sec. 1280.117 Industry information.

The term industry information means information and programs that

would lead to increased efficiency in processing and the development of

new markets, marketing strategies, increased marketing efficiency, and

activities to enhance the image of sheep or sheep products on a

national or international basis.

Sec. 1280.118 National feeder organization.

The term national feeder organization means any organization of

feeders that has been certified by the Secretary pursuant to the Act

and this part as being eligible to submit nominations for membership on

the Board.

Sec. 1280.119 Part and subpart.

Part means the Sheep and Wool Promotion, Research, Education, and

Information Order and all rules and regulations issued pursuant to the

Act and the Order, and the Order itself shall be a ``subpart'' of such

part.

Sec. 1280.120 Person.

The term person means any individual, group of individuals,

partnership, corporation, association, cooperative, or any other legal

entity.

Sec. 1280.121 Processor.

The term processor means any person who slaughters sheep or

processes greasy wool into degreased wool.

Sec. 1280.122 Producer.

The term producer means any person, other than a feeder, who owns

or acquires ownership of sheep.

Sec. 1280.123 Producer information.

The term producer information means activities designed to provide

producers, feeders, and importers with information relating to

production or marketing efficiencies or developments, program

activities, or other information that would facilitate an increase in

the consumption of sheep or sheep products.

Sec. 1280.124 Promotion.

The term promotion means any action (including paid advertising) to

advance the image and desirability of sheep or sheep products, to

improve the competitive position, and stimulate sales, of sheep

products in the domestic and international marketplace.

Sec. 1280.125 Pulled wool.

The term pulled wool means wool that is pulled from the skin of

slaughtered sheep.

Sec. 1280.126 Qualified State Sheep Board.

The term Qualified State Sheep Board means a sheep and wool

promotion entity that:

(a) Is authorized by State statute or organized and operating

within a State;

(b) Receives voluntary contributions or dues and conducts

promotion, research, or consumer information programs with respect to

sheep or wool, or both; and

(c) Is recognized by the Board as the sheep and wool promotion

entity within the State; except that not more than one QSSB shall exist

in any State at any one time.

Sec. 1280.127 Raw wool.

The term raw wool means greasy wool, pulled wool, degreased wool,

or carbonized wool.

Sec. 1280.128 Research.

The term research means development projects and studies relating

to the production (including the feeding of sheep), processing,

distribution, or use of sheep or sheep products, to encourage, expand,

improve, or make more efficient the marketing of sheep or sheep

products.

Sec. 1280.129 Secretary.

The term Secretary means the Secretary of Agriculture of the United

States or any other officer or employee of the Department to whom

authority has been delegated, or to whom authority may be delegated, to

act in the Secretary's stead.

Sec. 1280.130 Sheep.

The term sheep means ovine animals of any age, including lambs.

Sec. 1280.131 Sheep products.

The term sheep products means products produced in whole or in part

from sheep, including wool and products containing wool fiber.

Sec. 1280.132 State.

The term State means each of the 50 States.

Sec. 1280.133 Unit.

The term unit means each State, group of States, or class

designation that is represented on the Board.

Sec. 1280.134 United States.

The term United States means the 50 States and the District of

Columbia.

Sec. 1280.135 Wool.

The term wool means the fiber from the fleece of a sheep.

Sec. 1280.136 Wool products.

The term wool products means products produced, in whole or in

part, from wool and products containing wool fiber.

National Sheep Promotion, Research, and Information Board

Sec. 1280.201 Establishment and membership of the Board.

There is hereby established a National Sheep Promotion, Research,

and Information Board (Board) of 120 members. Members of the Board

shall be appointed by the Secretary from nominations submitted in

accordance with this subpart. The seats shall be apportioned as

follows:

(a) Producers: For purposes of nominating producers to the Board,

each State shall be represented by the following number of members:

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

Board

Unit members

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

Alabama....................................................... 1

Alaska........................................................ 1

Arizona....................................................... 1

Arkansas...................................................... 1

California.................................................... 5

Colorado...................................................... 4

Connecticut................................................... 1

Delaware...................................................... 1

Florida....................................................... 1

Georgia....................................................... 1

Hawaii........................................................ 1

Idaho......................................................... 2

Illinois...................................................... 1

Indiana....................................................... 1

Iowa.......................................................... 2

Kansas........................................................ 1

Kentucky...................................................... 1

Louisiana..................................................... 1

[[Page 19519]]

Maine......................................................... 1

Maryland...................................................... 1

Massachusetts................................................. 1

Michigan...................................................... 1

Minnesota..................................................... 2

Mississippi................................................... 1

Missouri...................................................... 1

Montana....................................................... 5

Nebraska...................................................... 1

Nevada........................................................ 1

New Hampshire................................................. 1

New Jersey.................................................... 1

New Mexico.................................................... 2

New York...................................................... 1

North Carolina................................................ 1

North Dakota.................................................. 2

Ohio.......................................................... 1

Oklahoma...................................................... 1

Oregon........................................................ 2

Pennsylvania.................................................. 1

Rhode Island.................................................. 1

South Carolina................................................ 1

South Dakota.................................................. 4

Tennessee..................................................... 1

Texas......................................................... 10

Utah.......................................................... 3

Vermont....................................................... 1

Virginia...................................................... 1

Washington.................................................... 1

West Virginia................................................. 1

Wisconsin..................................................... 1

Wyoming....................................................... 5

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

(b) Feeders. The feeder sheep industry shall be represented by 10

members.

(c) Importers. Importers shall be represented by 25 members.

(d) Alternates. A unit represented by only one producer member may

have an alternate member appointed to ensure representation at meetings

of the Board.

Sec. 1280.202 Nominations.

(a) Producers. The Secretary shall appoint producers and alternates

to represent units as specified under Sec. 1280.201(a) of this subpart

from nominations submitted by organizations certified under

Sec. 1280.207. A certified organization may submit only nominations for

producer representatives and alternates if appropriate from the

membership of the organization for the unit in which the organization

operates. To be represented on the Board, each certified organization

shall submit to the Secretary at least 1.5 nominations for each seat on

the Board for which the unit is entitled to representation. If a unit

is entitled to only one seat on the Board, the unit shall submit at

least two nominations for the appointment.

(b) Feeders. The Secretary shall appoint representatives of the

feeder sheep industry to seats established under Sec. 1280.201(b) from

nominations submitted by qualified national organizations that

represent the feeder sheep industry. To be represented on the Board,

the industry shall provide at least 1.5 nominations for each

appointment to the Board to which the feeder sheep industry is

entitled.

(c) Importers. The Secretary shall appoint importers to seats

established under Sec. 1280.201(c) from nominations submitted by

qualified organizations that represent importers. The Secretary shall

receive at least 1.5 nominations for each appointment to the Board to

which importers are entitled.

(d) As soon as practicable, the Secretary shall obtain nominations

from certified organizations. If no organization is certified in a unit

the Secretary may use other means to obtain nominations. A certified

organization shall only submit nominations for positions on the Board

representing units in which such certified organization can establish

that it is certified as eligible to submit nominations for

representation of that unit of individual producers, feeders, or

importers residing in that unit.

(e) After the establishment of the initial Board, the Department

shall announce when a vacancy does or will exist. Nominations shall be

initiated not less than 6 months before the expiration of the terms of

the members whose terms are expiring, in the manner described in

Sec. 1280.205(b). In the case of vacancies due to reasons other than

the expiration of term of office, successor Board members shall be

appointed pursuant to Sec. 1280.206.

(f) Where there is more than one eligible organization representing

producers, feeders, or importers in a State or unit, they may caucus

and jointly nominate a minimum of 1.5 qualified persons for each

position representing that State or unit on the Board for which a

member is to be appointed. If joint agreement is not reached with

respect to any such nominations, or if no caucus is held, each

certified organization may submit nominations for each appointment to

be made to represent that State or unit.

(g) Nominations should be submitted in order of preference and, for

the initial Board, in order of preference for staggered terms. If the

Secretary rejects any nominations submitted and there are insufficient

nominations submitted from which appointments can be made, the

Secretary may request additional nominations under paragraphs (a), (b),

or (c) of this section.

Sec. 1280.203 Nominee's agreement to serve.

Any producer, feeder, or importer nominated to serve on the Board,

or as an alternate, shall file with the Secretary at the time of the

nomination a written agreement to:

(a) Serve on the Board if appointed;

(b) Disclose any relationship with any organization that operates a

qualified State or regional program or has a contractual relationship

with the Board; and

(c) Withdraw from participation in deliberations, decision making,

or voting on matters that concern the relationship disclosed under

paragraph (b) of this section.

Sec. 1280.204 Appointment.

From the nominations made pursuant to Sec. 1280.202 above, the

Secretary shall appoint the members of the Board on the basis of

representation provided in Sec. 1280.201 above.

Sec. 1280.205 Method of obtaining nominations.

(a) Initially Established Board.

(1) Producer and Alternate Nominations. The Secretary shall

solicit, from organizations certified under Sec. 1280.207, nominations

for each producer's or alternate member's seat on the initially-

established Board to which a unit is entitled. If no such organization

exist, the Secretary shall solicit nominations for appointments in such

manner as the Secretary determines appropriate.

(2) Feeder and Importer Nominations. The Secretary shall solicit,

from certified organizations that represent feeders and importers,

nominations for each seat to which feeders or importers are entitled.

If no such organization exists, the Secretary shall solicit nominations

for appointments in such manner as the Secretary determines

appropriate. In determining whether an organization is eligible to

submit nominations under this subparagraph, the Secretary shall

determine whether:

(A) The organization's active membership includes a significant

number of feeders or importers in relation to the total membership of

the organization;

(B) There is evidence of stability and permanency of the

organization; and

(C) The organization has a primary and overriding interest in

representing the feeder or importer segment of the sheep industry.

(b) Subsequent Appointment.

(1) Producer Nominations. The solicitation of nominations for

subsequent appointment to the Board from eligible organizations

certified under Sec. 1280.207 shall be initiated by the Secretary, with

the Board securing the nominations for the Secretary.

(2) Feeder and Importer Nominations. The solicitation of feeder and

importer

[[Page 19520]]

nominations for subsequent appointment to the Board shall be made by

the Secretary from organizations certified in accordance with paragraph

(a)(2) of this section.

Sec. 1280.206 Vacancies.

To fill any vacancy occasioned by the death, removal, resignation,

or disqualification of any member of the Board, the Secretary shall

appoint a successor from the most recent list of nominations for the

position or from nominations submitted by the Board.

Sec. 1280.207 Certification of organizations.

(a) In general. The eligibility of any State organization to

represent producers and to participate in the making of nominations

under this subpart shall be certified by the Secretary. The Secretary

shall certify any State organization that the Secretary determines

meets the eligibility criteria established under paragraph (b) of this

section. An eligibility determination by the Secretary shall be final.

(b) Basis for Certification. Certification shall be based upon, in

addition to other available information, a factual report submitted by

the organization that shall contain information considered relevant and

specified by the Secretary, including:

(1) The geographic territory covered by the active membership of

the organization;

(2) The nature and size of the active membership of the

organization, including the proportion of the total number of active

producers represented by the organization;

(3) Evidence of stability and permanency of the organization;

(4) Sources from which the operating funds of the organization are

derived;

(5) The functions of the organization; and

(6) The ability and willingness of the organization to further the

aims and objectives of the Act.

(c) Primary Considerations. A primary consideration in determining

the eligibility of an organization under this paragraph shall be

whether:

(1) The membership of the organization consists primarily of

producers who own a substantial quantity of sheep; and

(2) An interest of the organization is in the production of sheep.

Sec. 1280.208 Term of office.

Each appointment to the Board shall be for a term of 3 years,

except that appointments to the initially established Board shall be

proportionately for 1-year, 2-year, and 3-year terms. No person may

serve more than two consecutive 3-year terms, except that elected

officers shall not be subject to the term limitation while they hold

office.

Sec. 1280.209 Compensation.

Board members shall serve without compensation, but shall be

reimbursed for their reasonable expenses incurred in performing their

duties as Board members.

Sec. 1280.210 Removal.

If the Secretary determines that any person appointed under this

part fails to perform his or her duties properly or engages in acts of

dishonesty or willful misconduct, the Secretary shall remove the person

from office. The Secretary may remove a person appointed or certified

under this part, or any employee of the Board, if the Secretary

determines that the person's continued service would be detrimental to

the purposes of the Act.

Sec. 1280.211 Powers and duties of the Board.

The Board shall have the following powers and duties:

(a) To elect officers of the Board, including a chairperson, vice

chairperson, and secretary/treasurer;

(b) To administer this subpart in accordance with its terms and

provisions;

(c) To recommend regulations to effectuate the terms and provisions

of this subpart;

(d) To hold at least one annual meeting and any additional meetings

it deems appropriate;

(e) To elect members of the Board to serve on the Executive

Committee;

(f) To approve or reject budgets submitted by the Executive

Committee;

(g) To submit budgets to the Secretary for approval;

(h) To contract with entities, if necessary, to implement plans or

projects in accordance with the Act;

(i) To conduct programs of promotion, research, consumer

information, education, industry information, and producer information;

(j) To receive, investigate, and report to the Secretary complaints

of violations of this subpart;

(k) To recommend to the Secretary amendments to this subpart;

(l) To provide the Secretary with prior notice of meetings of the

Board to permit the Secretary or a designated representative to attend

such meetings;

(m) To provide not less than annually a report to producers,

feeders, and importers, accounting for the funds expended by the Board,

and describing programs implemented under the Act; and to make such

report available to the public upon request;

(n) To establish seven regions that, to the extent practicable,

contain geographically contiguous States and approximately equal

numbers of sheep producers and sheep production;

(o) To employ or retain necessary staff; and

(p) To invest funds in accordance with Sec. 1280.214.

Sec. 1280.212 Budgets.

(a) In general. The Board shall review the budget submitted by the

Executive Committee, on a fiscal year basis, of anticipated expenses

and disbursements by the Board, including probable costs of

administration and promotion, research, consumer information,

education, industry information, and producer information projects. The

Board shall submit the budget to the Secretary for the Secretary's

approval.

(b) Limitation. No expenditure of funds may be made by the Board

unless such expenditure is authorized under a budget or budget

amendment approved by the Secretary.

Sec. 1280.213 Books and records of the Board.

The Board shall:

(a) Maintain such books and records, which shall be made available

to the Secretary for inspection and audit, as the Secretary may

prescribe;

(b) Prepare and submit to the Secretary, from time-to-time, such

reports as the Secretary may prescribe; and

(c) Account for the receipt and disbursement of all funds entrusted

to it. The Board shall cause its books and records to be audited by an

independent auditor at the end of each fiscal year, and a report of

such audit to be submitted to the Secretary.

Sec. 1280.214 Investment of funds.

The Board may invest, pending disbursement, funds it receives under

this subpart, only in obligations of the United States or any agency

thereof, in general obligations of any State or any political

subdivision thereof, in any interest-bearing account or certificate of

deposit of a bank that is a member of the Federal Reserve System, or in

obligations fully guaranteed as to principal and interest by the United

States. Any income from any such investment may be used for any purpose

for which the invested funds may be used.

Sec. 1280.215 Use of assessments.

(a) Assessments received by the Board shall be used by the Board:

[[Page 19521]]

(1) To fund promotion, research, education, and information plans

and projects authorized under this subpart, including promotion plans

and projects which make specific reference to domestic sheep and sheep

products originating or being produced and/or marketed in the U.S.,

except that the combined expenditures for such promotion plans and

projects involving domestic country of origin shall be limited to no

more than the combined domestic assessments collected on sheep and

sheep products and the percentage of domestic assessments spent on the

promotion of domestic sheep and sheep products shall not exceed the

percentage of import assessments spent on the generic promotion of

sheep and sheep products; and

(2) For the payment of expenses incurred in administering this

subpart, including a reasonable reserve.

(b) The Board shall reimburse the Secretary, from assessments

collected, for costs incurred in implementing and administering the

Order as provided for under the Act.

Executive Committee

Sec. 1280.216 Establishment.

The Board shall establish an Executive Committee of the Board to

assist the Board in the administration of the terms and provisions of

this subpart, under the direction of the Board, and consistent with the

policies determined by the Board.

Sec. 1280.217 Membership.

The Executive Committee shall be comprised of 14 members:

(a) Eleven members of the Executive Committee shall be elected by

the Board annually. Of these members:

(1) One member shall represent each of the seven regions

established under Sec. 1280.211(n) for a total of seven members

representing producers;

(2) One member shall represent feeders; and

(3) Three members shall represent importers.

(b) The remaining three members of the Executive Committee shall be

the elected officers of the Board.

Sec. 1280.218 Powers and duties.

(a) Plans and Projects. The Executive Committee shall develop plans

or projects of promotion and advertising, research, consumer

information, education, industry information, and producer information,

which plans or projects shall be paid for with assessments collected by

the Board. The plans or projects shall not become effective until

approved by the Secretary.

(b) Budgets. The Executive Committee shall be responsible for

developing and submitting to the Board, for Board approval, budgets on

a fiscal year basis of the Board's anticipated expenses and

disbursements, including the estimated costs of advertising and

promotion, research, consumer information, education, industry

information, and producer information projects. The Board shall approve

or disapprove such budgets and, if approved, shall submit them to the

Secretary for the Secretary's approval.

Sec. 1280.219 Term of office.

Terms of appointment to the Executive Committee shall be for 1

year.

Sec. 1280.220 Chairperson.

The Chairperson of the Board shall serve as chairperson of the

Executive Committee.

Sec. 1280.221 Quorum.

A quorum of the Executive Committee shall consist of eight members.

Sec. 1280.222 Vacancies.

To fill any vacancy caused by the death, removal, resignation, or

disqualification of any member of the Executive Committee, the Board

shall elect a successor for the position pursuant to Sec. 1280.217.

Expenses

Sec. 1280.223 Expenses.

(a) The Board shall be responsible for all expenses of the Board

and the Executive Committee.

(b) Contracts and Agreements. Any contract or agreement entered

into by the Board shall provide that:

(1) The contracting party shall develop and submit to the Board a

plan or project of promotion, research, education, consumer

information, industry information, and producer information, together

with a budget or budgets that shall show estimated costs to be incurred

for such plan or project; and

(2) No plan, project, contract, or agreement shall become effective

until it has been approved by the Secretary.

(c) The contracting party shall:

(1) keep accurate records of all of its transactions;

(2) account for funds received and expended, including staff time,

salaries, and expenses expended on behalf of Board activities;

(3) make periodic reports to the Board of activities conducted; and

(4) make such other reports as the Board or the Secretary may

require.

Assessments

Sec. 1280.224 Sheep purchases.

(a) In general. Each person making payment to a producer or feeder

for sheep purchased from the producer or feeder shall be a collecting

person and shall collect an assessment from the producer or feeder on

each sheep sold by the producer or feeder. Each such producer or feeder

shall pay such assessment to the collecting person at the rate set

forth in paragraph (d) of this section.

(b) Remittances. Each processor making payment to a producer,

feeder, or collecting person for sheep purchased from the producer,

feeder, or collecting person shall be a collecting person and shall

collect an assessment from the producer, feeder, or other collecting

person on each sheep sold by the producer, feeder, or collecting

person, and each such producer, feeder, or collecting person shall pay

such assessment to the processor at the rate set forth in paragraph (d)

in this section, and such processor shall remit the assessment to the

Board.

(c) Processing. Any person who purchases sheep for processing shall

collect the assessment from the seller and remit the assessment to the

Board.

(d) Rate. Except as otherwise provided, the rate of assessment

shall be 1 cent per pound of live sheep sold. The rate of assessment

may be raised or lowered no more than 0.15 of a cent in any 1 year as

recommended by the Executive Committee and approved by the Board and

the Secretary. However, if the Board makes a recommendation to the

Secretary to raise or lower the assessment rates, the domestic rate and

the import rate must be raised or lowered simultaneously by an

equivalent amount. The rate of assessment shall not exceed 2\1/2\ cents

per pound.

Sec. 1280.225 Wool purchases.

(a) In general. Each person making payment to a producer, feeder,

or handler of wool for wool purchased from the producer, feeder, or

handler shall be a collecting person and shall collect an assessment

from the producer, feeder, or handler on each pound of greasy wool

sold. The producer, feeder, or handler shall pay such assessment to the

collecting person at the rate set forth in (d) of this section.

(b) Remittances. Each processor making payment to a producer,

feeder, handler, or collecting person for wool purchased from the

producer, feeder, handler, or collecting person shall be a collecting

person and shall collect an assessment from the producer, feeder,

[[Page 19522]]

handler, or other collecting person on all wool sold by the producer,

feeder, handler, or collecting person, and each such producer, feeder,

handler, or collecting person shall pay such assessment to the

processor at the rate set forth in paragraph (d) of this section and

such processor shall remit the assessment to the Board.

(c) Processing. Any person purchasing greasy wool for processing

shall collect the assessment and remit the assessment to the Board.

(d) Rate. Except as otherwise provided, the rate of assessment

shall be 2 cents per pound. The rate of assessment may be raised or

lowered no more than 0.2 of a cent per pound in any 1 year as

recommended by the Executive Committee and approved by the Board and

the Secretary. However, if the Board makes a recommendation to the

Secretary to raise or lower the assessment rates, the domestic rate and

the import rate must be raised or lowered simultaneously by an

equivalent amount. The rate of assessment shall not exceed 4 cents per

pound of greasy wool.

Sec. 1280.226 Direct processing.

Each person who processes or causes to be processed sheep or sheep

products of that person's own production, and markets such sheep or

sheep products, shall pay an assessment on such sheep or sheep products

at the time of sale at a rate equivalent to the rate established in

Sec. 1280.224(d) or Sec. 1280.225(d), as appropriate, and shall remit

such assessment to the Board.

Sec. 1280.227 Export.

Each person who exports live sheep or greasy wool shall remit the

assessment on such sheep or greasy wool at the time of export, at a

rate equivalent to the rate established in Sec. 1280.224(d) or

Sec. 1280.225(d), as appropriate, and shall remit such assessment to

the Board.

Sec. 1280.228 Imports.

(a) In general. Each person who imports sheep or sheep products or

who imports wool or products containing wool (with the exception of raw

wool) into the United States shall pay an assessment to the Board.

(b) Collection. Customs is authorized to collect and remit such

assessment to the Secretary for disbursement to the Board.

(c) Rate for Sheep and Sheep Products. The assessment rate for

sheep shall be 1 cent per pound of live sheep. The assessment rate for

sheep products shall be the equivalent of 1 cent per pound of live

sheep, as determined by the Secretary in consultation with the domestic

sheep industry. Such rates may be raised or lowered no more than 0.15

cent per pound in any 1 year as recommended by the Executive Committee

and approved by the Board and the Secretary, but shall not exceed 2\1/

2\ cents per pound. However, if the Board makes a recommendation to the

Secretary to raise or lower the assessment rates, the domestic rate and

the import rate must be raised or lowered simultaneously by an

equivalent amount.

(d) Rate for Wool and Wool Products. The assessment rate for wool

and products containing wool shall be 2 cents per pound of degreased

wool or the equivalent of degreased wool. The rate of assessment may be

raised or lowered no more than 0.2 cents per pound in any 1 year, as

recommended by the Executive Committee and approved by the Board and

the Secretary, but shall not exceed 4 cents per pound of degreased wool

or the equivalent. However, if the Board makes a recommendation to the

Secretary to raise or lower the assessment rates, the domestic rate and

the import rate must be raised or lowered simultaneously by an

equivalent amount.

(e) The Secretary shall issue regulations regarding the assessment

rates for imported sheep and sheep products. The Secretary may exclude

from assessment certain imported products that contain de minimis

levels of sheep or sheep products and waive the assessment on such

products.

Sec. 1280.229 Qualified State Sheep Boards.

(a) Except as provided in paragraph (b) of this section, 20 percent

of the total assessments collected by the Board on the marketings of

domestic sheep and domestic sheep products in any 1 year from a State

shall be returned to the QSSB of the State.

(b) No QSSB shall receive less than $2,500 under paragraph (a) of

this section in any 1 year.

(c) The Board shall establish procedures with the approval of the

Secretary to account for funds expended pursuant to paragraphs (a) and

(b) of this section.

Sec. 1280.230 Collection.

(a) Each person responsible for the collection and remittance to

the Board of assessments under this subpart shall do so on a monthly

basis, unless the Board, with the approval of the Secretary, has

specifically authorized otherwise.

(b) Late Payment Charges. Any unpaid assessments due the Board or

from a person responsible for remitting assessments to the Board, shall

be increased by 2 percent each month beginning with the day after the

date such assessments were due under this subpart. Any assessments or

late payment charges that remain unpaid shall be increased at the same

rate on the corresponding day of each month thereafter until paid.

(c) Any unpaid assessments due to the Board pursuant to

Sec. 1280.224, Sec. 1280.225, Sec. 1280.226, and Sec. 1280.227 shall be

increased 2 percent each month beginning with the day following the

date such assessments were due. Any remaining amount due, which shall

include any unpaid charges previously made pursuant to this paragraph,

shall be increased at the same rate on the corresponding day of each

month thereafter until paid. For the purposes of this paragraph, any

assessment determined at a date later than the date prescribed by this

subpart because of a person's failure to submit a timely report to the

Board shall be considered to have been payable by the date it would

have been due if the report had been timely filed. The date of payment

is the applicable postmark date or the date of receipt by the Board,

whichever is earlier.

(d) If the Board is not in place by the date the first assessments

are to be collected, the Secretary shall have the authority to receive

assessments and invest them on behalf of the Board, and shall pay such

assessments and any interest earned to the Board when it is formed. The

Secretary shall have the authority to promulgate rules and regulations

concerning assessments and the collection of assessments if the Board

is not in place or is otherwise unable to develop such rules and

regulations.

Sec. 1280.231 Prohibition on use of funds.

(a) Except as otherwise provided in paragraph (b) of this section,

no funds collected by the Board under this subpart shall be used in any

manner for the purpose of influencing any action or policy of the

United States Government, any foreign or State Government, or any

political subdivision thereof.

(b) The prohibition in paragraph (a) of this section shall not

apply:

(1) To the development and recommendation of amendments to this

subpart; or

(2) To the communication to appropriate Government officials, in

response to a request made by the officials, of information relating to

the conduct, implementation, or results of promotion, research,

consumer information, education, industry

[[Page 19523]]

information, or producer information activities under this subpart;

(c) A plan or project conducted pursuant to this title shall not

make false or misleading claims on behalf of sheep or sheep products or

against a competing product.

(d) No such plans or projects shall be undertaken to promote or

advertise any sheep or sheep products by brand or trade name without

the approval of the Board and the concurrence of the Secretary.

Reports, Books, and Records

Sec. 1280.232 Reports.

(a) Each collecting person, including processors and other persons

required to remit assessments to the Board pursuant to Sec. 1280.224(b)

for live sheep, each person who markets sheep products of that person's

own production and each exporter of sheep shall report to the Board

information pursuant to regulations prescribed by the Board and

approved by the Secretary. Such information may include:

(1) The number of sheep purchased, initially transferred or which,

in any other manner, are subject to the collection of assessment, and

the dates of such transaction;

(2) The number of sheep imported or exported, or the equivalent

thereof sheep products imported;

(3) The amount of assessment remitted;

(4) An explanation for the remittance of any assessment that is

less than the pounds of sheep multiplied by the assessment rate; and

(5) The date any assessment was paid.

(b) Each collecting person, including processors and other persons

required to remit assessments to the Board pursuant to Sec. 1280.225(b)

for wool purchased from the producer or handler of wool or wool

products, each person purchasing greasy wool for processing, each

importer of wool or wool products (except raw wool), each exporter of

greasy wool, and each person who markets wool of that person's own

production shall report to the Board information pursuant to

regulations prescribed by the Board and approved by the Secretary. Such

information may include:

(1) The amount of wool purchased, initially transferred or in any

other manner subject to the collection of assessment, and the dates of

such transaction;

(2) The amount of wool imported (except raw wool) or the equivalent

thereof of wool products imported or the amount of greasy wool

exported;

(3) The amount of assessment remitted;

(4) An explanation for the remittance of an assessment that is less

than the pounds of wool multiplied by the assessment rate; and

(5) The date any assessment was paid.

Sec. 1280.233 Books and records.

(a) Each collecting person, including processors and other persons

required to remit assessments to the Board, each importer of sheep or

sheep products (except raw wool), and exporter of sheep or greasy wool,

and each person who markets sheep products of that person's own

production, shall maintain and make available for inspection such books

and records as may be required by regulations prescribed by the Board

and approved by the Secretary, including records necessary to verify

any required reports. Such records shall be maintained for the period

of time prescribed by the regulations issued hereunder.

(b) Document Evidencing Payment of Assessments. Each collecting

person responsible for collecting an assessment paid pursuant to this

subpart, other than a person who slaughters sheep or markets sheep

products of his or her own production for sale, is required to give the

person or collecting person from whom the collecting person collected

an assessment written evidence of payment of the assessments paid

pursuant to this subpart. Such written evidence serving as a receipt

shall include:

(1) Name and address of the collecting person;

(2) Name of the producer who paid the assessment;

(3) Number of head of sheep or pounds of wool sold;

(4) Total assessments paid by the producer;

(5) Date; and

(6) Such other information as the Board, with the approval of the

Secretary, may require.

Sec. 1280.234 Use of information.

Information from records or reports required pursuant to this

subpart shall be made available to the Secretary as is appropriate to

the administration or enforcement of the Act, this subpart or any

regulation issued under the Act. In addition, the Secretary shall

authorize the use under this part of information that is accumulated

under laws or regulations other than the Act or regulations issued

under the Act regarding persons paying producers, feeders, importers,

handlers, or processors.

Sec. 1280.235 Confidentiality.

(a) All information from records or reports required pursuant to

this subpart shall be kept confidential by all officers and employees

of the Department and of the Board. Such information may be disclosed

only if the Secretary considers the information relevant, the

information is disclosed only in a suit or administrative hearing

brought at the direction or on the request of the Secretary, or to

which the Secretary or any officer of the United States is a party, and

the information relates to the Act.

(b) Administration. No information obtained under the authority of

this subpart may be made available to any agency or officer of the

Federal Government for any purpose other than the implementation of the

Act and any investigatory or enforcement action necessary for the

implementation of the Act.

(c) General Statements. Nothing in paragraph (a) of this section

may be deemed to prohibit:

(1) The issuance of general statements, based on the reports of the

number of persons subject to this subpart or statistical data collected

therefrom, which statements do not identify the information furnished

by any person; or

(2) The publication, by direction of the Secretary, of the name of

any person violating this subpart and a statement of the particular

provisions of this subpart violated by such person.

(d) Penalty. Any person who willfully violates the provisions of

this section, on conviction, shall be subject to a fine of not more

than $1,000, or to imprisonment for not more than 1 year, or both, and

if the person is an officer or employee of the Board or the Department,

that person shall be removed from office.

Miscellaneous

Sec. 1280.240 Right of the Secretary.

All fiscal matters, programs or projects, bylaws, rules or

regulations, reports, or other substantive actions proposed, and

prepared by the Board shall be submitted to the Secretary for approval.

Sec. 1280.241 Proceedings after termination.

(a) Upon the termination of this subpart, the Board shall recommend

not more than five of its members to the Secretary to serve as trustees

for the purpose of liquidating the affairs of the Board. Such persons,

upon designation by the Secretary, shall become trustees of all the

funds and property owned, in the possession of or under the control of

the Board, including any claims of the Board against third parties that

exist at the time of such termination.

(b) The trustees shall:

[[Page 19524]]

(1) Act as trustees until discharged by the Secretary;

(2) Carry out the obligations of the Board under any contracts or

agreements entered into by the Board pursuant to Sec. 1280.223(b);

(3) From time to time account for all receipts and disbursements

and deliver all property on hand, together with all books and records

of the Board and of the trustees, to such persons as the Secretary may

direct; and

(4) Upon the request of the Secretary, execute such assignment of

other instruments necessary or appropriate to transfer to such persons

full title and right to all of the funds, property, and claims of the

Board or the trustees pursuant to this subpart.

(c) Any person to whom funds, property or claims have been

transferred or delivered pursuant to this subpart shall be subject to

the same obligation imposed upon the Board and upon the trustees.

(d) Any residual funds not required to pay the necessary costs of

liquidation shall be turned over to the Secretary to be used, to the

extent practicable, for continuing one or more of the promotion,

research, consumer information, education, industry information, and

producer information plans or projects authorized pursuant to this

subpart.

Sec. 1280.242 Effect of termination or amendment.

Unless otherwise expressly provided by the Secretary, the

termination of this subpart or of any regulation issued pursuant

thereto, or the issuance of any amendment to either thereof, shall not:

(a) Affect or waive any right, duty, obligation, or liability that

has arisen or may hereafter arise in connection with any provision of

this subpart or any regulation issued thereunder; or

(b) Release or extinguish any violation of this subpart or any

regulation issued thereunder; or

(c) Affect or impair any rights or remedies of the United States,

the Secretary or any person with respect to any such violation.

Sec. 1280.243 Personal liability.

No member, employee, or agent of the Board, including employees,

agents, or Board members of the QSSB, acting pursuant to the authority

provided in this subpart, shall be held personally responsible, either

individually or jointly, in any way whatsoever, to any person for

errors in judgment, mistakes, or other acts of either commission or

omission, of such member, employee, or agent except for acts of

dishonesty or willful misconduct.

Sec. 1280.244 Patents, copyrights, inventions, and publication.

Any patents, copyrights, inventions, or publications developed

through the use of funds remitted to the Board under the provisions of

this subpart shall be the property of the United States Government as

represented by the Board, and shall, along with any rents, royalties,

residual payments, or other income from the rental, sales, leasing,

franchising, or other uses of such patents, copyrights, inventions, or

publications, inure to the benefit of the Board. Upon termination of

this subpart, Sec. 1280.240 shall apply to determine disposition of all

such property.

Sec. 1280.245 Amendments.

Amendments to the subpart may be proposed, from time to time, by

the Board or by any interested person affected by the provisions of the

Act, including the Secretary.

Sec. 1280.246 Separability.

If any provision of this subpart is declared invalid or its

applicability to any person or circumstances is held invalid, the

validity of the remainder of this subpart of the applicability thereof

to other persons or circumstances shall not be affected thereby.

Dated: April 26, 1996.

Lon Hatamiya,

Administrator.

[FR Doc. 96-10887 Filed 5-1-96; 8:45 am]

BILLING CODE 3410-02-P