EEP FY 96-7
DEIP FY 96-7
COAP/SOAP FY 96-6
GSM FY 96-6
SCGP FY 96-5
WASHINGTON, July 18, 1996---This Notice replaces Notice Number EEP FY 92-2, DEIP
92-2, COAP/SOAP FY 92-2, and GSM FY 92-7, dated July 27, 1992, to include in its scope the
Supplier Credit Guarantee Program (SCGP).
Christopher E. Goldthwait, general sales manager of the U.S. Department of Agriculture's
Foreign Agricultural Service, today reminded exporters of the importance of accurately reporting
all items required in offers to the Commodity Credit Corporation (CCC) or USDA to acquire a
bonus under the Export Enhancement Program (EEP), Dairy Export Incentive Program (DEIP),
Cottonseed Oil Assistance Program (COAP), and Sunflowerseed Oil Assistance Program
(SOAP). Goldthwait said CCC personnel have noted inconsistencies by exporters in reporting
two items required in an offer--the sales agent for the contract, and commissions in conjunction
with the sales contract unit price. This notice is intended to clarify the requirements for reporting
these two items. This Notice is effective as of today's date, except for the SCGP, in which case
this Notice is effective on August 30, 1996.
The following are the sources for these requirements for each program:
EEP and DEIP - 7 C.F.R. 1494.501 (c) (15) and (18); 7 C.F.R. 1494.1200.
COAP - Announcement GSM-514A, V. C. (15) and (18).
SOAP - Announcement GSM-515A, V. C. (15) and (18).
Pursuant to item (18) in the above program regulations/announcements, exporters are
state the name and address of the agent, if any, whose services they used in making the sale for
which an offer is being submitted under the EEP, DEIP, COAP, and SOAP. The intent of the
requirement is to report the name and address of the exporter's bona fide agent, not the name of
an agent employed by the buyer or required by the buyer to be used by the exporter.
In regard to the reporting of commissions in conjunction with the sales contract unit price
(15) in the above regulations/announcements), this requirement applies to a situation where the
payment of a commission results in an adjustment to the contract price to the buyer. In general,
this occurs when the exporter makes a payment to a party at the insistence or request of the
buyer, regardless of whether that party performs a service for the exporter. For example, when an
exporter is required by the buyer to pay a commission to an agent of the buyer, the amount of the
commission must be reported in conjunction with the sales contract unit price.
This reporting requirement also applies when a buyer requires an exporter to employ and
compensate a specified agent as a condition of concluding the export sale. Such commissions or
other payments are treated by USDA and CCC as discounts to the sales contract unit price for the
purpose of the price/bonus review under the EEP, DEIP, COAP, and SOAP and are considered
discounts or allowances as defined in 7 C.F.R. 1493.20(f) under the Export Credit Guarantee
Program (GSM-102) and the Intermediate Export Credit Guarantee Program (GSM-103) and
1493.410(8) under the SCGP. Under the GSM-102/103 programs and the SCGP, discounts or
allowances must be deducted from the exported value and port value in accordance with 7 C.F.R.
1493.20(h) and (v) for GSM-102/103 and 1493.410(h) and (t) for SCGP. Exporters are not
required under EEP, DEIP, SOAP, COAP, GSM- 102/103, and SCGP to report commissions
paid to bona fide agents employed by the exporter.
Exporters having questions regarding these issues may call the CCC Operations Division
General information about CCC and USDA programs, resources, and services is available on
Internet. The address (url) for the FAS Home Page is http://www.fas.usda.gov.