§ 7804. — Required terms in orders.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 7USC7804]
TITLE 7--AGRICULTURE
CHAPTER 105--HASS AVOCADO PROMOTION, RESEARCH, AND INFORMATION
Sec. 7804. Required terms in orders
(a) In general
An order shall contain the terms and provisions specified in this
section.
(b) Hass Avocado Board
(1) Establishment and membership
(A) Establishment
The order shall provide for the establishment of a Hass
Avocado Board, consisting of 12 members, to administer the
order.
(B) Membership
(i) Appointment
The order shall provide that members of the Board shall
be appointed by the Secretary from nominations submitted as
provided in this subsection.
(ii) Composition
The Board shall consist of participating domestic
producers and importers.
(C) Special definition of importer
In this subsection, the term ``importer'' means a person who
is involved in, as a substantial activity, the importation,
sale, and marketing of Hass avocados in the United States
(either directly or as an agent, broker, or consignee of any
person or nation that produces or handles Hass avocados outside
the United States for sale in the United States), and who is
subject to assessments under the order.
(2) Distribution of appointments
(A) In general
The order shall provide that the membership of the Board
shall consist of the following:
(i) Seven members who are domestic producers of Hass
avocados and are subject to assessments under the order.
(ii) Two members who represent importers of Hass
avocados and are subject to assessments under the order.
(iii) Three members who are domestic producers of Hass
avocados and are subject to assessments under the order, or
are importers of Hass avocados and are subject to
assessments under the order, to reflect the proportion of
domestic production and imports supplying the United States
market, which shall be based on the Secretary's
determination of the average volume of domestic production
of Hass avocados proportionate to the average volume of
imports of Hass avocados in the United States over the
previous 3 years.
(B) Adjustment in Board representation
Three years after the assessment of Hass avocados commences
pursuant to an order, and at the end of each 3-year period
thereafter, the Avocado Board shall adjust the proportion of
producer representatives to importer representatives on the
Board under subparagraph (A)(iii) on the basis of the amount of
assessments collected from producers and importers over the
immediately preceding 3-year period. Any adjustment under this
subparagraph shall be subject to the review and approval of the
Secretary.
(3) Nomination process
The order shall provide that--
(A) two nominees shall be submitted for each appointment to
the Board;
(B) nominations for each appointment of a producer or an
importer shall be made by domestic producers or importers,
respectively--
(i) in the case of producers, through an election
process which utilizes existing organizations of avocado
producers established pursuant to a State statute, with
approval by the Secretary; and
(ii) in the case of importers, nominations are submitted
by importers under such procedures as the Secretary
determines appropriate; and
(C) in any case in which producers or importers fail to
nominate individuals for an appointment to the Board, the
Secretary may appoint an individual to fill the vacancy on a
basis provided in the order or other regulations of the
Secretary.
(4) Alternates
The order shall provide for the selection of alternate members
of the Board by the Secretary in accordance with procedures
specified in the order.
(5) Terms
The order shall provide that--
(A) each term of appointment to the Board shall be for 3
years, except that, of the initial appointments, four of the
appointments shall be for 2-year terms, four of the appointments
shall be for 3-year terms, and four of the appointments shall be
for 4-year terms; and
(B) no member of the Board may serve more than 2 consecutive
terms of 3 years, except that any member serving an initial term
of 4 years may serve an additional term of 3 years.
(6) Replacement
(A) Disqualification from Board service
The order shall provide that if a member or alternate of the
Board who was appointed as a domestic producer or importer
ceases to belong to the group for which such member was
appointed, such member or alternate shall be disqualified from
serving on the Board.
(B) Manner of filling vacancy
A vacancy arising as a result of disqualification or any
other reason before the expiration of the term of office of an
incumbent member or alternate of the Board shall be filled in a
manner provided in the order.
(7) Compensation
The order shall provide that members and alternates of the Board
shall serve without compensation, but shall be reimbursed for the
reasonable expenses incurred in performing duties as members or
alternates of the Board.
(c) General responsibilities of the Avocado Board
The order shall define the general responsibilities of the Avocado
Board, which shall include the responsibility to--
(1) administer the order in accordance with the terms and
provisions of the order;
(2) meet, organize, and select from among the members of the
Board a chairperson, other officers, and committees and
subcommittees, as the Board determines to be appropriate;
(3) recommend to the Secretary rules and regulations to
effectuate the terms and provisions of the order;
(4) employ such persons as the Board determines are necessary,
and set the compensation and define the duties of the persons;
(5)(A) develop budgets for the implementation of the order and
submit the budgets to the Secretary for approval under subsection
(d) of this section; and
(B) propose and develop (or receive and evaluate), approve, and
submit to the Secretary for approval under subsection (d) of this
section plans or projects for Hass avocado promotion, industry
information, consumer information, or related research;
(6)(A) implement plans and projects for Hass avocado promotion,
industry information, consumer information, or related research, as
provided in subsection (d) of this section; or
(B) contract or enter into agreements with appropriate persons
to implement the plans and projects, as provided in subsection (e)
of this section, and pay the costs of the implementation, or
contracts and agreement, with funds received under the order;
(7) evaluate on-going and completed plans and projects for Hass
avocado promotion, industry information, consumer information, or
related research and comply with the independent evaluation
provisions of the Commodity Promotion, Research, and Information Act
of 1996 (subtitle B of title V of Public Law 104-127 [7 U.S.C. 7411
et seq.]);
(8) receive, investigate, and report to the Secretary complaints
of violations of the order;
(9) recommend to the Secretary amendments to the order;
(10) invest, pending disbursement under a plan or project, funds
collected through assessments authorized under this chapter only
in--
(A) obligations of the United States or any agency of the
United States;
(B) general obligations of any State or any political
subdivision of a State;
(C) any interest-bearing account or certificate of deposit
of a bank that is a member of the Federal Reserve System; or
(D) obligations fully guaranteed as to principal and
interest by the United States, except that income from any such
invested funds may be used only for a purpose for which the
invested funds may be used;
(11) borrow funds necessary for the startup expenses of the
order; and
(12) provide the Secretary such information as the Secretary may
require.
(d) Budgets; plans and projects
(1) Submission of budgets
The order shall require the Board to submit to the Secretary for
approval budgets, on a fiscal year basis, of the anticipated
expenses and disbursements of the Board in the implementation of the
order, including the projected costs of Hass avocado promotion,
industry information, consumer information, and related research
plans and projects.
(2) Plans and projects
(A) Promotion and consumer information
The order shall provide--
(i) for the establishment, implementation,
administration, and evaluation of appropriate plans and
projects for advertising, sales promotion, other promotion,
and consumer information with respect to Hass avocados, and
for the disbursement of necessary funds for the purposes
described in this clause; and
(ii) that any plan or project referred to in clause (i)
shall be directed toward increasing the general demand for
Hass avocados in the domestic marketplace.
(B) Industry information
The order shall provide for the establishment,
implementation, administration, and evaluation of appropriate
plans and projects that will lead to the development of new
markets, maintain and expand existing markets, lead to the
development of new marketing strategies, or increase the
efficiency of the Hass avocado industry, and activities to
enhance the image of the Hass avocado industry, and for the
disbursement of necessary funds for the purposes described in
this subparagraph.
(C) Research
The order shall provide for--
(i) the establishment, implementation, administration,
and evaluation of plans and projects for market development
research, research with respect to the sale, distribution,
marketing, use, quality, or nutritional value of Hass
avocados, and other research with respect to Hass avocado
marketing, promotion, industry information or consumer
information;
(ii) the dissemination of the information acquired
through the plans and projects; and
(iii) the disbursement of such funds as are necessary to
carry out this subparagraph.
(D) Submission to Secretary
The order shall provide that the Board shall submit to the
Secretary for approval a proposed plan or project for Hass
avocados promotion, industry information, consumer information,
or related research, as described in subparagraphs (A), (B), and
(C).
(3) Approval by Secretary
A budget, plan, or project for Hass avocados promotion, industry
information, consumer information, or related research may not be
implemented prior to approval of the budget, plan, or project by the
Secretary. Not later than 45 days after receipt of such a budget,
plan, or project, the Secretary shall notify the Board whether the
Secretary approves or disapproves the budget, plan, or project. If
the Secretary fails to provide such notice before the end of the 45-
day period, the budget, plan, or project shall be deemed to be
approved and may be implemented by the Board.
(e) Contracts and agreements
(1) Promotion, consumer information, industry information
and related research plans and projects
(A) In general
To ensure the efficient use of funds, the order shall
provide that the Board, with the approval of the Secretary,
shall enter into a contract or an agreement with an avocado
organization established by State statute in a State with the
majority of Hass avocado production in the United States, for
the implementation of a plan or project for promotion, industry
information, consumer information, or related research with
respect to Hass avocados, and for the payment of the cost of the
contract or agreement with funds received by the Board under the
order.
(B) Requirements
The order shall provide that any contract or agreement
entered into under this paragraph shall provide that--
(i) the contracting or agreeing party shall develop and
submit to the Board a plan or project, together with a
budget that includes the estimated costs to be incurred for
the plan or project;
(ii) the plan or project shall become effective on the
approval of the Secretary; and
(iii) the contracting party or agreeing party shall--
(I) keep accurate records of all transactions of the
party;
(II) account for funds received and expended;
(III) make periodic reports to the Board of
activities conducted; and
(IV) make such other reports as the Board or the
Secretary shall require.
(2) Other contracts and agreements
The order shall provide that the Board, with the approval of the
Secretary, may enter into a contract or agreement for administrative
services. Any contract or agreement entered into under this
paragraph shall include provisions comparable to the provisions
described in paragraph (1)(B).
(f) Books and records of Board
(1) In general
The order shall require the Board to--
(A) maintain such books and records (which shall be
available to the Secretary for inspection and audit) as the
Secretary may require;
(B) prepare and submit to the Secretary, from time to time,
such reports as the Secretary may require; and
(C) account for the receipt and disbursement of all the
funds entrusted to the Board, including all assessment funds
disbursed by the Board to a State organization of avocado
producers established pursuant to State law.
(2) Audits
The Board shall cause the books and records of the Board to be
audited by an independent auditor at the end of each fiscal year. A
report of each audit shall be submitted to the Secretary.
(g) Control of administrative costs
(1) System of cost controls
The order shall provide that the Board shall, as soon as
practicable after the order becomes effective and after consultation
with the Secretary and other appropriate persons, implement a system
of cost controls based on normally accepted business practices
that--
(A) will ensure that the costs incurred by the Board in
administering the order in any fiscal year shall not exceed 10
percent of the projected level of assessments to be collected by
the Board for that fiscal year; and
(B) cover the minimum administrative activities and
personnel needed to properly administer and enforce the order,
and conduct, supervise, and evaluate plans and projects under
the order.
(2) Use of existing personnel and facilities
The Board shall use, to the extent possible, the resources,
staffs, and facilities of existing organizations, as provided in
subsection (e)(1)(A) of this section.
(h) Assessments
(1) Authority
(A) In general
The order shall provide that each first handler shall remit
to the Board, in the manner provided in the order, an assessment
collected from the producer, except to the extent that the sale
is excluded from assessments under paragraph (6). In the case of
imports, the assessment shall be levied upon imports and
remitted to the Board by Customs.
(B) Published lists
To facilitate the payment of assessments under this
paragraph, the Board shall publish lists of first handlers
required to remit assessments under the order and exempt
handlers.
(C) Making determinations
(i) First handler status
The order shall contain provisions regarding the
determination of the status of a person as a first handler
or exempt handler.
(ii) Producer-handlers
For purposes of paragraph (3), a producer-handler shall
be considered the first handler of those Hass avocados that
are produced by that producer-handler and packed by that
producer-handler for sale at wholesale or retail.
(iii) Importers
The assessment on imported Hass avocados shall be paid
by the importer to Customs at the time of entry into the
United States and shall be remitted by Customs to the Board.
Importation occurs when Hass avocados originating outside
the United States are released from custody of Customs and
introduced into the stream of commerce within the United
States. Importers include persons who hold title to foreign-
produced Hass avocados immediately upon release by Customs,
as well as any persons who act on behalf of others, as
agents, brokers, or consignees, to secure the release of
Hass avocados from Customs and the introduction of the
released Hass avocados into the current of commerce.
(2) Assessment rates
With respect to assessment rates, the order shall contain the
following terms:
(A) Initial rate
The rate of assessment on Hass avocados shall be $.025 per
pound on fresh avocados or the equivalent rate for processed
avocados on which an assessment has not been paid.
(B) Changes in the rate
(i) In general
Once the order in is effect, the uniform assessment rate
may be increased or decreased not more than once annually,
but in no event shall the rate of assessment be in excess of
$.05 per pound.
(ii) Requirements
Any change in the rate of assessment under this
subparagraph--
(I) may be made only if adopted by the Board by an
affirmative vote of at least seven members of the Board
and approved by the Secretary as necessary to achieve
the objectives of this chapter (after public notice and
opportunity for comment in accordance with section 553
of title 5 and without regard to sections 556 and 557 of
such title);
(II) shall be announced by the Board not less than
30 days prior to going into effect; and
(III) shall not be subject to a vote in a referendum
conducted under section 7805 of this title.
(3) Collection by first handlers
Except as provided in paragraph (1)(C)(iii), the first handler
of Hass avocados shall be responsible for the collection of
assessments from the producer under this subsection. As part of the
collection of assessments, the first handler shall maintain a
separate record of the Hass avocados of each producer whose Hass
avocados are so handled, including the Hass avocados produced by the
first handler.
(4) Timing of submitting assessments
The order shall provide that each person required to remit
assessments under this subsection shall remit to the Board the
assessment due from each sale of Hass avocados that is subject to an
assessment within such time period after the sale (not to exceed 60
days after the end of the month in which the sale took place) as is
specified in the order.
(5) Claiming an exemption from collecting assessments
To claim an exemption under section 7802(6) of this title as an
exempt handler for a particular fiscal year, a person shall submit
an application to the Board--
(A) stating the basis for such exemption; and
(B) certifying such person will not purchase Hass avocados
in the United States on which an assessment has not been paid
for the current fiscal year.
(6) Exclusion
An order shall exclude from assessments under the order any sale
of Hass avocados for export from the United States.
(7) Use of assessment funds
The order shall provide that assessment funds shall be used for
payment of costs incurred in implementing and administering the
order, with provision for a reasonable reserve, and to cover the
administrative costs incurred by the Secretary in implementing and
administering this chapter, including any expenses incurred by the
Secretary in conducting referenda under this chapter, subject to
subsection (i) of this section.
(8) Assessment funds for State association
The order shall provide that a State organization of avocado
producers established pursuant to State law shall receive an amount
equal to the product obtained by multiplying the aggregate amount of
assessments attributable to the pounds of Hass avocados produced in
such State by 85 percent. The State organization shall use such
funds and any proceeds from the investment of such funds for
financing domestic promotion, research, consumer information, and
industry information plans and projects, except that no such funds
shall be used for the administrative expenses of such State
organization.
(9) Assessment funds for importers associations
(A) In general
The order shall provide that any importers association shall
receive a credit described in subparagraph (B) if such
association is--
(i) established pursuant to State law that requires
detailed State regulation comparable to that applicable to
the State organization of United States avocado producers,
as determined by the Secretary; or
(ii) certified by the Secretary as meeting the
requirements applicable to the Board as to budgets, plans,
projects, audits, conflicts of interest, and reimbursements
for administrative costs incurred by the Secretary.
(B) Credit
An importers association described in subparagraph (A) shall
receive 85 percent of the assessments paid on Hass avocados
imported by the members of such association.
(C) Use of funds
(i) In general
Importers associations described in subparagraph (A)
shall use the funds described in subparagraph (B) and
proceeds from the investment of such funds for financing
promotion, research, consumer information, and industry
information plans and projects in the United States.
(ii) Administrative expenses
No funds described in subparagraph (C) shall be used for
the administrative expenses of such importers association.
(i) Reimbursement of Secretary expenses
The order shall provide for reimbursing the Secretary--
(1) for expenses not to exceed $25,000 incurred by the Secretary
in connection with any referendum conducted under section 7805 of
this title;
(2) for administrative costs incurred by the Secretary for
supervisory work of up to two employee years annually after an order
or amendment to any order has been issued and made effective; and
(3) for costs incurred by the Secretary in implementation of the
order issued under section 7803 of this title, for enforcement of
the chapter and the order, for subsequent referenda conducted under
section 7805 of this title, and in defending the Board in litigation
arising out of action taken by the Board.
(j) Prohibition on brand advertising and certain claims
(1) Prohibitions
Except as provided in paragraph (2), a program or project
conducted under this chapter shall not--
(A) make any reference to private brand names;
(B) make false, misleading, or disparaging claims on behalf
of Hass avocados; or
(C) make false, misleading, or disparaging statements with
respect to the attributes or use of any competing products.
(2) Exceptions
Paragraph (1) does not preclude the Board from offering its
programs and projects for use by commercial parties, under such
terms and conditions as the Board may prescribe as approved by the
Secretary. For the purposes of this subsection, a reference to State
of origin does not constitute a reference to a private brand name
with regard to any funds credited to, or disbursed by the Board to,
a State organization of avocado producers established pursuant to
State law. Furthermore, for the purposes of this section, a
reference to either State of origin or country of origin does not
constitute a reference to a private brand name with regard to any
funds credited to, or disbursed by the Board to, any importers
association established or certified in accordance with subsection
(h)(9)(A) of this section.
(k) Prohibition on use of funds to influence governmental action
(1) In general
Except as otherwise provided in paragraph (2), the order shall
prohibit any funds collected by the Board under the order from being
used in any manner for the purpose of influencing legislation or
government action or policy.
(2) Exception
Paragraph (1) shall not apply to the development or
recommendation of amendments to the order.
(l) Prohibition of conflict of interest
The Board may not engage in, and shall prohibit the employees and
agents of the Board from engaging in, any action that would be a
conflict of interest.
(m) Books and records; reports
(1) In general
The order shall provide that each first handler, producer, and
importer subject to the order shall maintain, and make available for
inspection, such books and records as are required by the order and
file reports at the time, in the manner, and having the content
required by the order, to the end that such information is made
available to the Secretary and the Board as is appropriate for the
administration or enforcement of this chapter, the order, or any
regulation issued under this chapter.
(2) Confidentiality requirement
(A) In general
Information obtained from books, records, or reports under
paragraph (1) shall be kept confidential by all officers and
employees of the Department of Agriculture and by the staff and
agents of the Board.
(B) Suits and hearings
Information described in subparagraph (A) may be disclosed
to the public only--
(i) in a suit or administrative hearing brought at the
request of the Secretary, or to which the Secretary or any
officer of the United States is a party, involving the
order; and
(ii) to the extent the Secretary considers the
information relevant to the suit or hearing.
(C) General statements and publications
Nothing in this paragraph may be construed to prohibit--
(i) the issuance of general statements, based on the
reports, of the number of persons subject to the order or
statistical data collected from the reports, if the
statements do not identify the information furnished by any
person; or
(ii) the publication, by direction of the Secretary, of
the name of any person who violates the order, together with
a statement of the particular provisions of the order
violated by the person.
(3) Lists of importers
(A) Review
The order shall provide that the staff of the Board shall
periodically review lists of importers of Hass avocados to
determine whether persons on the lists are subject to the order.
(B) Customs service
On the request of the Secretary or the Board, the
Commissioner of the United States Customs Service shall provide
to the Secretary or the Board lists of importers of Hass
avocados.
(n) Consultations with industry experts
(1) In general
The order shall provide that the Board may seek advice from and
consult with experts from the production, import, wholesale, and
retail segments of the Hass avocado industry to assist in the
development of promotion, industry information, consumer
information, and related research plans and projects.
(2) Special committees
(A) In general
For the purposes described in paragraph (1), the order shall
authorize the appointment of special committees composed of
persons other than Board members.
(B) Consultation
A committee appointed under subparagraph (A) shall consult
directly with the Board.
(o) Other terms of the order
The order shall contain such other terms and provisions, consistent
with this chapter, as are necessary to carry out this chapter (including
provision for the assessment of interest and a charge for each late
payment of assessments under subsection (h) of this section).
(Pub. L. 106-387, Sec. 1(a) [title XII, Sec. 1205], Oct. 28, 2000, 114
Stat. 1549, 1549A-82.)
References in Text
The Commodity Promotion, Research, and Information Act of 1996,
referred to in subsec. (c)(7), is subtitle B of title V of Pub. L. 104-
127, Apr. 4, 1996, 110 Stat. 1032, which is classified generally to
subchapter II (Sec. 7411 et seq.) of chapter 101 of this title. For
complete classification of this Act to the Code, see Short Title note
set out under section 7401 of this title and Tables.
Transfer of Functions
For transfer of functions, personnel, assets, and liabilities of the
United States Customs Service of the Department of the Treasury,
including functions of the Secretary of the Treasury relating thereto,
to the Secretary of Homeland Security, and for treatment of related
references, see sections 203(1), 551(d), 552(d), and 557 of Title 6,
Domestic Security, and the Department of Homeland Security
Reorganization Plan of November 25, 2002, as modified, set out as a note
under section 542 of Title 6.
Section Referred to in Other Sections
This section is referred to in sections 7802, 7805, 7809 of this
title.
