§1314h. Purchase requirements; penalty
(a) Statement of quantity purchased during marketing year
(1) At the conclusion of each marketing year, on or before a date prescribed by the Secretary, each domestic manufacturer of cigarettes shall submit to the Secretary a statement, by kind, of the quantity of Flue-cured and Burley quota tobacco purchased, directly or indirectly, by such manufacturer during such marketing year.
(2) The statement shall include, but not be limited to, the quantity of each such kind of tobacco purchased by the manufacturer on the United States auction markets, from producers, and from the inventories of tobacco from the 1985 and subsequent crops of the producer-owned cooperative marketing associations that have entered into loan agreements with the Commodity Credit Corporation to make price support available to producers of Flue-cured or Burley tobacco.
(b) Failure to purchase at least 90 percent of quantity of intended purchases; reduction in quantity of intended purchases
(1) Except as otherwise provided in this subsection, any domestic manufacturer of cigarettes that fails, as determined by the Secretary after notice and opportunity for a hearing, to purchase during a marketing year on the United States auction markets, from producers, or from the inventories of tobacco from the 1985 and subsequent crops of the producer associations described in subsection (a)(2) of this section a quantity of Flue-cured quota tobacco and a quantity of Burley quota tobacco equal to at least 90 percent of the quantity of the intended purchases of Flue-cured tobacco and Burley tobacco, respectively, submitted by such manufacturer or established by the Secretary for such manufacturer for that marketing year under section 1314g of this title (as that quantity may be reduced under paragraph (2)) shall be subject to a penalty as prescribed in subsection (c) of this section.
(2)(A) If the total quantity of Flue-cured or Burley quota tobacco, respectively, marketed by producers at auction in the United States during the marketing year in question is less than the national marketing quota (including any adjustments for overmarketings or undermarketings) for that kind of tobacco for that marketing year, the quantity of intended purchases of each domestic manufacturer of cigarettes, for purposes of paragraph (1), shall be reduced by a percentage equal to the percentage by which the total quantity marketed at auction in the United States during the marketing year is less than the national marketing quota (including any adjustments for overmarketings or undermarketings) for that kind of tobacco for the marketing year.
(B) For purposes of this section, the term "marketed" shall include disposition of tobacco by consigning the tobacco to a producer association described in subsection (a)(2) of this section for a price support advance.
(c) Penalty for failure to purchase specified amount
The amount of any penalty to be imposed on a manufacturer under this section shall be determined by multiplying-
(1) twice the per pound assessment (as determined under section 1445–1 or 1445–2 of this title) for the kind of tobacco involved; by
(2) the quantity by which-
(A) the purchases by such manufacturer on the United States auction markets, from producers, or from the inventories of tobacco from the 1985 and subsequent crops of the producer associations described in subsection (a)(2) of this section of Flue-cured and Burley quota tobacco, respectively, for the marketing year; are less than
(B) 90 percent of the quantity of intended purchases of such kinds of tobacco, respectively, submitted by the manufacturer or established by the Secretary for such manufacturer for that marketing year under section 1314g of this title (as that quantity may be reduced under subsection (b)(2) of this section).
(d) Transmission of penalty by Secretary; deposit in No Net Cost Fund or Account
(1) An amount equivalent to the penalty collected by the Secretary under this section shall be transmitted by the Secretary to the appropriate producer-owned cooperative marketing association that has entered into a loan agreement with the Commodity Credit Corporation to make price support available to producers of Flue-cured or Burley tobacco, as the case may be.
(2) Each association to which amounts are transmitted by the Secretary under this section shall deposit such amounts in the No Net Cost Fund or Account of such association in accordance with section 1445–1 or 1445–2 of this title.
(e) Confidentiality of information submitted; disclosure; publication of identity of violators; exemption from public disclosure; penalties
The limitations on disclosure set forth in subsections (c) and (d) of section 1314g of this title shall apply to information submitted by domestic manufacturers of cigarettes under this section with respect to the quantity of purchases of Flue-cured and Burley quota tobacco during a marketing year. Any officer or employee of the Department of Agriculture who violates such limitations on disclosure shall be subject to the penalties set forth in section 1314g(c)(4) of this title.
(f) "Quota tobacco" defined
As used in this section, the term "quota tobacco" means any kind of tobacco for which marketing quotas are in effect or for which marketing quotas are not disapproved by producers.
(Feb. 16, 1938, ch. 30, title III, §320B, as added
Effective Date
Section 1106(a) of
Rulemaking Procedures
For implementation of this section by the Secretary of Agriculture without regard to the provisions requiring notice and other procedures for public participation in rulemaking contained in section 553 of Title 5, Government Organization and Employees, or in any other directive of the Secretary, see section 1108(c) of
Section Referred to in Other Sections
This section is referred to in sections 1314c, 1314e, 1314i, 1372 of this title.