7 USC 1359 - Allocation of marketing allotments

View all text of Subpartvii [§ 1359aa - § 1359ll]

§ 1359dd. Allocation of marketing allotments

(a) Allocation to processors

(b) Hearing and notice

(1) Cane sugar

(A) In general

(B) Multiple processor States

Except as provided in subparagraphs (C) and (D), the Secretary shall allocate the allotment for cane sugar among multiple cane sugar processors in a single State based on—

(i) past marketings of sugar, based on the average of the 2 highest years of production of raw cane sugar from among the 1996 through 2000 crops;

(ii) the ability of processors to market sugar covered by that portion of the allotment allocated for the crop year; and

(iii) past processings of sugar from sugarcane, based on the average of the 3 highest years of production during the 1996 through 2000 crop years.

(D) Proportionate share States

In the case of States subject to section 1359ff(c) of this title, the Secretary shall allocate the allotment for cane sugar among multiple cane sugar processors in a single State based on—

(i) past marketings of sugar, based on the average of the 2 highest years of production of raw cane sugar from among the 1997 through 2001 crop years;

(ii) the ability of processors to market sugar covered by that portion of the allotments allocated for the crop year; and

(iii) past processings of sugar from sugarcane, based on the average of the 2 highest crop years of crop production during the 1997 through 2001 crop years.

(E) New entrants

(i) In general

(ii) Proportionate share States

(iii) Limitations

The allotment for a new processor under this subparagraph shall not exceed—

(I) in the case of the first crop year of operation of a new processor, 50,000 short tons (raw value); and(II) in the case of each subsequent crop year of operation of the new processor, a quantity established by the Secretary in accordance with this subparagraph and the criteria described in subparagraph (B) or (D), as applicable.

(iv) New entrant States(I) In general(II) Effect on other allotments

(v) Adverse effects

(vi) Ability to market

(vii) Prohibition

(F) Transfer of ownership

(2) Beet sugar

(A) In general

(B) Quantity

Subject to subparagraph (D), the weighted quantity of beet sugar produced by a beet sugar processor during each of the 1998 through 2000 crop years shall be (as determined by the Secretary)—

(i) in the case of the 1998 crop year, 25 percent of the quantity of beet sugar produced by the processor during the crop year;

(ii) in the case of the 1999 crop year, 35 percent of the quantity of beet sugar produced by the processor during the crop year; and

(iii) in the case of the 2000 crop year, 40 percent of the quantity of beet sugar produced by the processor (including any quantity of sugar received from the Commodity Credit Corporation) during the crop year.

(D) Adjustments

(i) In general

The Secretary shall adjust the weighted average quantity of beet sugar produced by a beet sugar processor during the 1998 through 2000 crop years under subparagraph (C) if the Secretary determines that the processor—

(I) during the 1996 through 2000 crop years, opened a sugar beet processing factory;(II) during the 1998 through 2000 crop years, closed a sugar beet processing factory;(III) during the 1998 through 2000 crop years, constructed a molasses desugarization facility; or(IV) during the 1998 through 2000 crop years, suffered substantial quality losses on sugar beets stored during any such crop year.

(ii) Quantity

The quantity of beet sugar produced by a beet sugar processor under subparagraph (C) shall be—

(I) in the case of a processor that opened a sugar beet processing factory, increased by 1.25 percent of the total of the adjusted weighted average quantities of beet sugar produced by all processors during the 1998 through 2000 crop years (without consideration of any adjustment under this subparagraph) for each sugar beet processing factory that is opened by the processor;(II) in the case of a processor that closed a sugar beet processing factory, decreased by 1.25 percent of the total of the adjusted weighted average quantities of beet sugar produced by all processors during the 1998 through 2000 crop years (without consideration of any adjustment under this subparagraph) for each sugar beet processing factory that is closed by the processor;(III) in the case of a processor that constructed a molasses desugarization facility, increased by 0.25 percent of the total of the adjusted weighted average quantities of beet sugar produced by all processors during the 1998 through 2000 crop years (without consideration of any adjustment under this subparagraph) for each molasses desugarization facility that is constructed by the processor; and(IV) in the case of a processor that suffered substantial quality losses on stored sugar beets, increased by 1.25 percent of the total of the adjusted weighted average quantities of beet sugar produced by all processors during the 1998 through 2000 crop years (without consideration of any adjustment under this subparagraph).

(E) Permanent termination of operations of a processor

If a processor of beet sugar has been dissolved, liquidated in a bankruptcy proceeding, or otherwise has permanently terminated operations (other than in conjunction with a sale or other disposition of the processor or the assets of the processor), the Secretary shall—

(i) eliminate the allocation of the processor provided under this section; and

(ii) distribute the allocation to other beet sugar processors on a pro rata basis.

(F) Sale of all assets of a processor to another processor

(G) Sale of factories of a processor to another processor

(i) Effect of sale

(ii) Application of allocation

The assignment of the allocation under clause (i) shall apply—

(I) during the remainder of the crop year for which the sale described in clause (i) occurs; and(II) during each subsequent crop year.

(iii) Use of other factories to fill allocation

(H) New entrants starting production, reopening, or acquiring an existing factory with production history

(i) Definition of new entrant(I) In general

In this subparagraph, the term “new entrant” means an individual, corporation, or other entity that—

(aa) does not have an allocation of the beet sugar allotment under this subpart;(bb) is not affiliated with any other individual, corporation, or entity that has an allocation of beet sugar under this subpart (referred to in this clause as a “third party”); and(cc) will process sugar beets produced by sugar beet growers under contract with the new entrant for the production of sugar at the new or re-opened factory that is the basis for the new entrant allocation.(II) Affiliation

For purposes of subclause (I)(bb), a new entrant and a third party shall be considered to be affiliated if—

(aa) the third party has an ownership interest in the new entrant;(bb) the new entrant and the third party have owners in common;(cc) the third party has the ability to exercise control over the new entrant by organizational rights, contractual rights, or any other means;(dd) the third party has a contractual relationship with the new entrant by which the new entrant will make use of the facilities or assets of the third party; or(ee) there are any other similar circumstances by which the Secretary determines that the new entrant and the third party are affiliated.

(ii) Allocation for a new entrant that has constructed a new factory or reopened a factory that was not operated since before 1998

If a new entrant constructs a new sugar beet processing factory, or acquires and reopens a sugar beet processing factory that last processed sugar beets prior to the 1998 crop year and there is no allocation currently associated with the factory, the Secretary shall—

(I) assign an allocation for beet sugar to the new entrant that provides a fair and equitable distribution of the allocations for beet sugar so as to enable the new entrant to achieve a factory utilization rate comparable to the factory utilization rates of other similarly-situated processors; and(II) reduce the allocations for beet sugar of all other processors on a pro rata basis to reflect the allocation to the new entrant.

(iii) Allocation for a new entrant that has acquired an existing factory with a production history(I) In general(II) Prohibition

(iv) Appeals

(Feb. 16, 1938, ch. 30, title III, § 359d, as added Pub. L. 107–171, title I, § 1403, May 13, 2002, 116 Stat. 191; amended Pub. L. 110–234, title I, § 1403(d), May 22, 2008, 122 Stat. 984; Pub. L. 110–246, § 4(a), title I, § 1403(d), June 18, 2008, 122 Stat. 1664, 1712.)