Dairy TRQ License Regulations to be Amended

The Department of Agriculture’s Foreign Agricultural Service is accepting comments through April 8 on a proposed rule that would make a number of amendments to the regulation that provides for the issuance of annual licenses to import certain dairy articles under tariff-rate quotas.

Under TRQs a low tariff rate (the in-quota rate) applies to imports up to a specified quantity. A higher tariff rate (the over-quota rate) applies to any imports in excess of that amount. Dairy articles may only be entered at the in-quota rate by or for the account of a person to whom a license has been issued. Licenses authorize the licensee to import a specified quantity and type of dairy article from a specified country of origin and are issued on a calendar year basis as one of three types: historical, non-historical (lottery), and designated.

FAS is now proposing a number of changes to the regulations regarding dairy TRQ licenses, including the following.

– addressing more specifically who may obtain a license and clarifying eligibility requirements

– to maximize the utilization of designated quotas, allowing for the reallocation of designated quantities in the event that a country fails to notify USDA of its designated companies for the following quota year by an Oct. 31 deadline

– moving forward from Oct. 1 to Sept. 1 the final date to surrender license quantities to permit earlier reallocation

– removing the requirement that eligible manufacturers and processors process at least 75 percent of licensed imports in their own facilities

– prohibiting the transfer of any licenses if a business or division of a business is sold, merged, or otherwise conveyed to another person

– specifying the circumstances under which the licensing authority may suspend or revoke a license for violations or for failure to comply with applicable regulations

– moving the deadline for reporting errors from Aug. 31 to March 31 of the calendar year following the year in which the error was alleged to have occurred