contracting date. Contracts made after the terminal contracting date will not be eligible for financing under the PA or PIO unless deliveries under such contracts are made within the specified delivery period (see subparagraph (3) of this paragraph).

(2) Reporting. With respect to PAS only, the cooperating country shall, in accordance with instructions issued by ICA, report within 30 days after the terminal contracting date the total or estimated total value of all contracts entered into pursuant to sub-authorizations made under the PA, whether or not deliveries have actually been made. If the total or estimated total value of such contracts, as so reported, is less than the total dollar and/or local currency amount of the PA, the PA will be reduced by the amount of the difference. If no such report is filed by the cooperating country within 30 days after the terminal contracting date, ICA will assume that the PA has been fully subauthorized and contracted for, and no reduction in the PA will be made.

(3) Deliveries. Each PA or PIO will also state a delivery period. The period will be indicated normally by two dates: (i) The date before which deliveries may not be made (initial delivery date) and (ii) the date on or before which deliveries must be made (terminal delivery date). Where however, an initial delivery date is not specified, the date of issuance of the PA or PIO shall be deemed to be the initial delivery date. Deliveries made before the initial delivery date or after the terminal delivery date will not be eligible for ICA financing under the PA or PIO. ICA may extend the terminal delivery date for limited periods on an individual contract basis, if the contract was made on or before the terminal contracting date.

(4) Inland transportation. Inland transportation other than within the cooperating country (except to the first port of entry) will be eligible for financing under commodity and service PAS or PIOs provided that such transportation services are delivered on or after the initial delivery date and on or before the terminal delivery date specified on the PA or PIO. The date of delivery of inland transportation services shall be deemed to be the date of the related railway, barge, truck or airway bill of lading, submitted under § 201.18.

(b) Submission of documentation of delivery. In the case of reimbursement by letter of commitment to a bank, the submission of documentation shall be in accordance with § 201.16 (c) (2). In the case of other types of reimbursement, proper documentation of deliveries, in accordance with § 201.18 must be presented within 90 days after the latest date on which deliveries may take place under the PA or PIO, to the Controller, ICA, Washington, D. C., or to the appropriate USOM Controller if so specified in the PA or PIO.

(c) Ocean transportation PAS or PIOS. Ocean transportation PAS or PIOS will not be subject to the provisions of paragraphs (a) and (b) of this section, but will be subject to the following provisions:

(1) Deliveries—(i) Between initial and terminal delivery dates. Delivery of ocean transportation services may be made at any time on or after the initial delivery date and on or before the terminal delivery date specified on the PA or PIO.

(ii) Fixing of delivery date. The date of delivery of ocean transportation services shall be deemed to be the date of the related bill of lading, airway bill, or the cablegram alternatively submitted under $201.18.

(2) Submission of documentation of delivery. In the case of reimbursement by letter of commitment to a bank, the submission of documentation shall be in accordance with § 201.16 (c) (2). In the case of other types of reimbursement, proper documentation in accordance with § 201.18 (b) must be presented, within 120 days after the date of the bill of lading covering ocean shipment, to the Controller, ICA, Washington, D. C. or to the appropriate USOM Controller if so specified in the PA or PIO.

§201.6 General provisions deemed incorporated in PAS and PIOS. Each PA or PIO issued shall be deemed to incorporate the following provisions:

(a) Reimbursement. Upon receipt of the documents required for reimbursement by this part, ICA will make reimbursement up to the amount specified in the PA or PIO for the assistance described in the PA or PIO, such reimbursement to be made by any one of the methods prescribed in Subpart C of this part.

(b) Assignment of right to receive reimbursement. The right to receive reimbursement under a PA or PIO may be assigned, in whole or in part, to a banking institution in the United States, but no such assignment shall be valid unless the proposed assignee has been named in a letter of commitment or otherwise approved by the Director or a Director, USOM.

(c) Modification or revocation. The Director with respect to a PA or PIO, and a Director, USOM, with respect to a PIO, reserves the right at any time and from time to time, and for any reason or cause whatsoever, to supplement, modify, or revoke any PA or PIO (including termination of deliveries under the PA or PIO). In the event of any supplement, modification, or revocation, the right of reimbursement will be modified or terminated accordingly, except that if a letter of commitment has been issued, the rights of the holder of any such letter of commitment shall not be affected except to the extent specified in such letter of commitment.

(d) Refund to Director-(1) Obligation of cooperating country. The cooperating country will pay promptly to the Director upon demand the entire amount reimbursed (or such lesser amount as the Director may demand) whenever full documentation is not furnished within the specified time, or whenever it appears to the Director that the documentation submitted by or on behalf of the cooperating country (or any approved applicant named in a letter of commitment) does not support the expenditure for which the reimbursement was made, or whenever the Director determines that the reimbursement was improper as being in violation of any of the provisions of the act, any acts amendatory thereof or supplemental thereto, any relevant appropriation acts, or any rules, regulations or procedures of ICA promulgated under any of said acts.

(2) Period for making refund demands. Demands for refunds from cooperating countries under this part may be made by the Director within five years after the date of reimbursement by ICA.

(e) Discounts. If a contract for which reimbursement is claimed provides for one or more discounts, only the invoice

amount after discount (seller's gross price less all discounts) will be eligible for reimbursement.

(f) Commissions—(1) Purchasing agents. No commission paid or to be paid to an agent, broker or other representative of an importer will be eligible for reimbursement.

(2) Sales agents. A commission paid or to be paid to an agent, broker, or other representative of the supplier (domestic or foreign) is not prohibited and will be eligible for reimbursement. However, if the amount of any such commission exceeds the amounts paid by the supplier's competitive sellers or exceeds the amounts paid by the supplier in comparable sales, the Director may, subsequent to reimbursement, request repayment from the importing country of the amount of such commission. The amount of such commission shall be fully reported by the supplier on ICA Form 280 (see § 201.18 (d)). A payment, credit, or other allowance to a foreign distributor of a supplier, in connection with direct imports by such a distributor for his own account, however, is not to be considered as an agent's commission but as a discount, as defined in paragraph (e) of this section, and must be deducted from the gross amount of the supplier's invoice.

(g) Adjustment refunds and adjustment credits-(1) Requirements for credit to ICA. If an importer receives an adjustment refund, or an adjustment credit, arising out of the terms of a contract or out of the normal customs of the trade, the Director will, in making reimbursement directly to a cooperating country, withhold the amount of such refund or credit; in case of other types of reimbursement, the Director will request repayment of the amount of such refund or credit from the cooperating country.

(2) Notice to ICA from supplier. Upon settlement of a claim for an adjustment refund or an adjustment credit, the supplier shall immediately give written notice to the Controller, ICA, Washington, D. C., indicating the PA or PIO number, the name and address of the importer, the date and amount of the original invoice, and the reason for the refund or credit and the amount thereof.

(h) Insurance-(1) Eligibility for ICA financing. Dollar payments of premi

ums for ocean marine insurance (including war risk insurance) on ICAfinanced commodities procured in the United States will be eligible for financing by ICA under a commodity PA or PIO if such insurance is:

(i) Placed by the importer (or by the supplier or any other person if authorized so to do by the importer in a cable, written document, or the letter of credit); and

(ii) Placed at the lowest available competitive rate.

(2) Advice to insurer of PA or PIO number. The importer, supplier, or other person placing such insurance shall furnish the PA or PIO number to the insurer.

(3) Instructions by cooperating country to importer. In authorizing or subauthorizing procurement under a commodity PA or PIO, the cooperating country will instruct each importer that, with respect to commodities procured in the United States pursuant to the PA or PIO, dollar funds made available under the authorization or subauthorization may, at the election of the importer, be used to purchase in the United States marine insurance for such commodities.

(4) Documentation for reimbursement of premiums. As documentation to support ICA reimbursement for marine insurance dollar premiums, the insurer, insurance broker, or underwriter will execute a supplier's certificate (Form ICA-280) in accordance with § 201.18 (a) (2) (i) (c).

(5) Anti-discrimination requirement. In the event a cooperating country, by statute, decree, rule or regulation, discriminates with respect to ICA financed procurement against any marine insurance company authorized to do business in any State of the United States, then commodities procured in the United States with ICA funds, destined for such country, and insured against marine risk, shall be so insured in the United States with a company or companies authorized to do a marine insurance business in any State of the United States.

(i) Airmail distribution of ocean bills of lading. The cooperating country or authorized agent will instruct importers to advise shippers to airmail at the time of loading one copy (or photostat) of ocean or charter party bill of lading or airway bill to the Controller, USOM,

American Embassy, in the capital city of the cooperating country receiving the shipment.

(j) Price limitations. ICA will not make reimbursement directly to a cooperating country for the purchase in bulk of any commodities at prices higher than the market price prevailing in the United States, adjusted as provided in § 201.20, nor will ICA make reimbursement directly to a cooperating country for a purchase of any commodity at a price higher than the price calculated in accordance with the applicable price provisions in § 201.21; in cases of other types of reimbursement, the Director will demand repayment from the cooperating country of the entire amount so reimbursed.

(k) Export licenses. Where procurement is effected in the United States for any commodity covered by a PA or PIO, export licenses, to the extent required, must be obtained from the U. S. Department of Commerce. All exports from the United States of commodities furnished under the act are subject to such export quotas as may be established and such export license controls as may be exercised by the U. S. Department of Commerce.

(1) Diversions—(1) Agreement by cooperating country and importer. The cooperating country agrees, and, as a condition of the receipt by an importer of authority to use the PA or PIO in placing orders, the importer shall be deemed to have agreed, that, upon a determination by the Director that such action is necessary to accomplish the purposes of the act, ICA shall be vested with title to ICA-financed commodities which have been delivered but not then off-loaded in ports of the cooperating country, and the cooperating country will, upon such determination, assign, execute and furnish, or cause to be assigned, executed and furnished, to ICA documents requested by ICA relating to such ICA-financed commodities including, but not limited to, negotiable bills of lading, supplier's invoices, packing lists and inspection certificates. The Director is authorized to take such action with respect to such commodities as he may deem necessary and proper including, without limiting the generality of the foregoing, the following: (i) To direct masters of vessels carrying such commodities to divert them from the designated ports of destination to

such other ports as may be designated by ICA, and (ii) to cause to be inserted in relevant charter parties, bills of lading and other shipping documents a diversion clause substantially in the following form:

ICA may designate an alternate port of discharge within the range of ports covered by the applicable conference tariff. Diversion charges as per tariff to apply including deviation insurance and extra handling cost if incurred.

In

(2) ICA financial responsibility. the event of any such determination by the Director and action taken pursuant to subparagraph (1) of this paragraph, ICA will, subject to availability of funds therefor, assume responsibility for extra costs of transportation services (including, where applicable, marine insurance and extra handling costs) caused by such action but ICA shall not be subject to any liability to the cooperating country, its importers or the approved applicant, except for the payment of such costs as ICA, in its sole discretion, may deem appropriate under the circumstances.

(3) Rights of holder of letter of commitment. Notwithstanding the foregoing subparagraphs (1) and (2) of this paragraph, if a letter of commitment has been issued, the rights of the holder of any such letter of commitment shall not be affected except to the extent specified in such letter of commitment.

(m) Re-export. The re-export of commodities financed by ICA, within three years of the date of reimbursement therefor, in the form or substantially in the form received, except as authorized by ICA, is not permitted, and in the event of any unauthorized re-export the cooperating country will pay promptly to the Director upon demand the entire amount reimbursed or such lesser or greater amount as the Director may deem appropriate under the circumstances of the particular transaction, not to exceed, however, the amount realized from the sale of any such commodity.

(n) U. S. flag vessel shipping requirement (1) Scope of cooperating country responsibility. The cooperating country will ensure that at least 50 percent of the gross tonnage of all ICA-financed commodities transported to it on ocean vessels during each U. S. fiscal year as well as each quarterly period thereof is

transported on privately-owned U. S. flag commercial vessels. The foregoing requirement applies separately for dry bulk carrier shipments, dry cargo liner shipments, and tanker shipments and also applies separately for shipments (i) from the U. S.; (ii) from Europe and Africa; (iii) from the area of the Near East and South Asia; (iv) from Latin America and Canada; and (v) from the area of the Far East. If the foregoing requirement is not met with respect to shipments made during any fiscal year or quarter thereof, the cooperating country will pay promptly to the Director upon demand whatever amount, reimbursed by ICA for commodities, marine insurance, and transportation in shipments directed to the cooperating country during that period of time, as the Director in his discretion shall consider necessary to effect a compliance by the cooperating country with the foregoing requirement for that period of time.

(2) Non-availability of U. S. flag vessels. Any cooperating country may at any time apply to the Office of Transportation, ICA, Washington, D. C., for an administrative determination with respect to any proposed shipment that no privately-owned U. S. flag commercial vessel is available for such shipment at fair and reasonable rates for such a vessel. In the event that the Office of Transportation shall make such a determination of non-availability, it will advise the cooperating country thereof. Tonnage involved in any or all shipments included in the determination of non-availability of U. S. flag vessels may or may not be excluded from the total tonnage of the fiscal year and the relevant quarter thereof for at least 50 percent of which the cooperating country must ensure transportation on U. S. flag vessels. The determination concerning such exclusion shall be made by the Office of Transportation after a review of all pertinent factors relating to all ICA-financed shipments to the cooperating country during the relevant fiscal year and quarterly period, and the cooperating country shall be advised thereof by the Office of Transportation.

(0) Transportation limitations. ICA will not finance commodities or the transportation thereof which are shipped to cooperating countries by any transportation medium owned, operated or under the control of any country not in

Icluded within the meaning of Code 99 as defined in the ICA Geographic Code Book (as amended).

(p) Special provisions. The provisions of this section may be waived, amended or supplemented by special provision in the PA or PIO, or otherwise, pursuant to § 201.23.

§ 201.7 Ocean transportation—(a) Eligibility for ICA financing. Ocean transportation PAs and, in the case of shipments where the supplier pays the ocean freight either for his own or the buyer's account, the PAs or PIOS for the commodity involved, may be used by the dollar cooperating country to cover and/or local currency services furnished in connection with the shipment to the cooperating country of:

On

(1) ICA-financed cargoes. (i) flag vessels of countries included within the meaning of Code 99 as defined in the ICA Geographic Code Book (as amended) but excluding those of the cooperating country, (ii) where ICA dollar reimbursement is requested, to the extent that payment for such services is made in dollars in accordance with the custom of the trade, or, if not in accordance with the custom of the trade, only if approved by the Office of Transportation, ICA, Washington, D .C.; and (iii) where ICA local currency reimbursement is requested, to the extent that payment for such services is made in the specified local currency in accordance with the custom of the trade or other acceptable local currencies..

(2) Non-ICA financed cargoes. On United States flag vessels.

(i)

(ii) On flag vessels of countries included within the meaning of Code 99 as defined in the ICA Geographic Code Book (as amended), but excluding the United States or the cooperating country, but only in special circumstances where specifically authorized in writing by ICA to do so pursuant to a request in writing.

(b) Rate limitations. The rate charged by a supplier of ocean transportation services shall not exceed the prevailing rate for similar freight contracts nor the rate paid to the supplier for similar ocean transportation services by other customers similarly situated.

(c) Reimbursement. Reimbursement will be made as follows:

(1) Dry bulk cargo shipments—(i) Costs under charter party. Reimburse

ment will be made for cost of shipment from ports of loading to ports of discharge at rates established by charter parties.

(ii) Loading, trimming and related costs. Reimbursement for loading, trimming and other related shipping expenses may be made when such expenses are not for the account of the ship nor included in inland transportation charges.

(iii) Demurrage and dispatch earnings. Reimbursement will not be made for demurrage incurred in excess of dispatch earnings. Amounts earned for dispatch shall be credited first against demurrage, if any, incurred in connection with the same voyage; the balance supported by the vessel's signed laytime statement(s), shall then be refunded to the Controller, ICA, Washington, D. C., within 90 days after date of discharge of the cargo on which dispatch was earned.

(iv) Brokerage and address commissions. No brokerage commissions in excess of 22 percent of the freight and no address commission will be eligible for reimbursement; the names of all persons participating in the eligible brokerage commission must be indicated on the charter party.

(2) Dry cargo liner shipments—(i) Costs under conference rates. Reimbursement will be made for cost of shipment from ports of loading to ports of discharge at the rates indicated in the bill of lading, but not in excess of the conference rates for such services.

(ii) Related shipping costs. Reimbursement for related shipping expenses may be made when such expenses are not for the account of the ship nor included in inland transportation charges.

(3) Tanker shipments—(i) Costs under charter parties or contracts. Reimbursement will be made for cost of shipment from ports of loading to ports of discharge at rates established by charter parties or contracts of affreightment.

(ii) Related shipping costs. Reimbursement for related shipping expenses may be made when such expenses are not for the account of the ship nor included in inland transportation charges. (d) Prior review of charter parties by ICA. All charters (whether single voyage charters, or consecutive voyage charters, or time charters) of all vessels