§1314i. Domestic marketing assessment
(a) Certification
A domestic manufacturer of cigarettes shall certify to the Secretary, for each calendar year, the percentage of the quantity of tobacco used by the manufacturer to produce cigarettes during the year that is produced in the United States.
(b) Penalties
(1) In general
Subject to subsection (f) of this section, a domestic manufacturer of cigarettes that has failed, as determined by the Secretary after notice and opportunity for a hearing, to use in the manufacture of cigarettes during a calendar year a quantity of tobacco grown in the United States that is at least 75 percent of the total quantity of tobacco used by the manufacturer, or to comply with subsection (a) of this section, shall be subject to the requirements of subsections (c), (d), and (e) of this section.
(2) Failure to certify
For purposes of this section, if a manufacturer fails to comply with subsection (a) of this section, the manufacturer shall be presumed to have used only imported tobacco in the manufacture of cigarettes produced by the manufacturer.
(3) Reports and records
(A) In general
The Secretary shall require manufacturers of domestic cigarettes to make such reports and maintain such records as are necessary to carry out this section. If the reports and records are insufficient, the Secretary may request other persons to provide supplemental information.
(B) Examinations
For the purpose of ascertaining the correctness of any report or record required under this section, or of obtaining further information required under this section, the Secretary and the Office of Inspector General may examine such records, books, and other materials as the Secretary has reason to believe may be relevant. In the case of a manufacturer of domestic cigarettes, the Secretary may charge a fee to the manufacturer to cover the reasonable costs of any such examination.
(C) Penalties
Any person who fails to provide information required under this paragraph or who provides false information under this paragraph shall be subject to section 1001 of title 18.
(D) Confidentiality
Section 1314g(c) of this title shall apply to information submitted by manufacturers of domestic cigarettes and other persons under this paragraph.
(E) Disclosure
Notwithstanding any other provision of law, information on the percentage or quantity of domestic or imported tobacco in cigarettes or on the volume of cigarette production that is submitted under this section shall be exempt from disclosure under section 552 of title 5.
(c) Domestic marketing assessment
(1) In general
A domestic manufacturer of cigarettes described in subsection (b) of this section shall remit to the Commodity Credit Corporation a nonrefundable marketing assessment in accordance with this subsection.
(2) Amount
The amount of an assessment imposed on a manufacturer under this subsection shall be determined by multiplying-
(A) the quantity by which the quantity of imported tobacco used by the manufacturer to produce cigarettes during a preceding calendar year exceeds 25 percent of the quantity of all tobacco used by the manufacturer to produce cigarettes during the preceding calendar year; by
(B) the difference between-
(i) ½ of the sum of-
(I) the average price per pound received by domestic producers for Burley tobacco during the preceding calendar year; and
(II) the average price per pound received by domestic producers for Flue-cured tobacco during the preceding calendar year; and
(ii) the average price per pound of unmanufactured imported tobacco during the preceding calendar year, as determined by the Secretary.
(3) Collection
An assessment imposed under this subsection shall be-
(A) collected by the Secretary and transmitted to the Commodity Credit Corporation; and
(B) enforced in the same manner as provided in section 1314h of this title.
(d) Purchase of Burley tobacco
(1) In general
A domestic manufacturer of cigarettes described in subsection (b) of this section shall purchase from the inventories of the producer-owned cooperative marketing associations for Burley tobacco described in section 1314h(a)(2) of this title, at the applicable list price published by the association, the quantity of tobacco described in paragraph (2).
(2) Quantity
Subject to paragraph (3), the quantity of Burley tobacco required to be purchased by a manufacturer during a calendar year under this subsection shall equal ½ of the quantity of imported tobacco used by the manufacturer to produce cigarettes during the preceding calendar year that exceeds 25 percent of the quantity of all tobacco used by the manufacturer to produce cigarettes during the preceding calendar year.
(3) Limitation
If the total quantity of Burley tobacco required to be purchased by all manufacturers under paragraph (2) would reduce the inventories of the producer-owned cooperative marketing associations for Burley tobacco to less than the reserve stock level for Burley tobacco, the Secretary shall reduce the quantity of tobacco required to be purchased by manufacturers under paragraph (2), on a pro rata basis, to ensure that the inventories will not be less than the reserve stock level for Burley tobacco.
(4) Noncompliance
If a manufacturer fails to purchase from the inventories of the producer-owned cooperative marketing associations the quantity of Burley tobacco required under this subsection, the manufacturer shall be subject to a penalty of 75 percent of the average market price (calculated to the nearest whole cent) for Burley tobacco for the immediately preceding year on the quantity of tobacco as to which the failure occurs.
(5) Purchase requirements
Tobacco purchased by a manufacturer under this subsection shall not be included in determining the quantity of tobacco purchased by the manufacturer under section 1314h of this title.
(e) Purchase of Flue-cured tobacco
(1) In general
A domestic manufacturer of cigarettes described in subsection (b) of this section shall purchase from the inventories of the producer-owned cooperative marketing association for Flue-cured tobacco described in section 1314h(a)(2) of this title, at the applicable list price published by the association, the quantity of tobacco described in paragraph (2).
(2) Quantity
Subject to paragraph (3), the quantity of Flue-cured tobacco required to be purchased by a manufacturer during a calendar year under this subsection shall equal ½ of the quantity of imported tobacco used by the manufacturer to produce cigarettes during the preceding calendar year that exceeds 25 percent of the quantity of all tobacco used by the manufacturer to produce cigarettes during the preceding calendar year.
(3) Limitation
If the total quantity of Flue-cured tobacco required to be purchased by all manufacturers under paragraph (2) would reduce the inventories of the producer-owned cooperative marketing association for Flue-cured tobacco to less than the reserve stock level for Flue-cured tobacco, the Secretary shall reduce the quantity of tobacco required to be purchased by manufacturers under paragraph (2), on a pro rata basis, to ensure that the inventories will not be less than the reserve stock level for Flue-cured tobacco.
(4) Noncompliance
If a manufacturer fails to purchase from the inventories of the producer-owned cooperative marketing association the quantity of Flue-cured tobacco required under this subsection, the manufacturer shall be subject to a penalty of 75 percent of the average market price (calculated to the nearest whole cent) for Flue-cured tobacco for the immediately preceding year on the quantity of tobacco as to which the failure occurs.
(5) Purchase requirements
Tobacco purchased by a manufacturer under this subsection shall not be included in determining the quantity of tobacco purchased by the manufacturer under section 1314h of this title.
(f) Crop losses due to disasters
(1) In general
If the Secretary, in consultation with producer-owned cooperative marketing associations, determines that because of drought, insect or disease infestation, or other natural disaster, or other condition beyond the control of producers, the total quantity of a crop of domestic Burley tobacco or Flue-cured tobacco that is harvested and suitable for marketing is substantially less than the expected yield for the crop, and that pool inventories for the kind of tobacco involved have been depleted, effective for the calendar year following the year in which the crop loss occurs, the Secretary may reduce the minimum percentage of domestic tobacco specified in subsection (a) of this section to a percentage below 75 percent, as determined by the Secretary, that reflects the reduced availability of domestic supplies of the kind of tobacco involved.
(2) Determination of expected yield
For purposes of paragraph (1), the Secretary shall determine the expected yield for a crop of Burley tobacco or Flue-cured tobacco by taking into consideration-
(A) the total acreage planted to the crop (including acreage that the producers were prevented from planting because of a condition referred to in paragraph (1)); and
(B) normal farm yields established for the crop.
(3) Deadline for determinations
The Secretary shall make determinations under paragraph (1) about crop losses and announce the reduced percentage of the domestic tobacco pool not later than November 30 of the year in which the applicable crop of Burley tobacco or Flue-cured tobacco is harvested.
(g) Effective date
This section shall be effective only for calendar year 1994.
(Feb. 16, 1938, ch. 30, title III, §320C, as added
Amendments
1994-Subsec. (g).
Effective Date of 1994 Amendment
Section 422(e) of
[Proc. No. 6821, Sept. 12, 1995, 60 F.R. 47663, effective Sept. 13, 1995, established tariff-rate quotas on certain tobacco.]