[Code of Federal Regulations]
[Title 7, Volume 10]
[Revised as of January 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR1493.120]

[Page 819-820]
 
                          TITLE 7--AGRICULTURE
 
  CHAPTER XIV--COMMODITY CREDIT CORPORATION, DEPARTMENT OF AGRICULTURE
 
PART 1493--CCC EXPORT CREDIT GUARANTEE PROGRAMS--Table of Contents
 
    Subpart B--CCC Export Credit Guarantee Program (GSM-102) and CCC 
    Intermediate Export Credit Guarantee Program (GSM-103) Operations
 
Sec. 1493.120  Payment for loss.

    (a) Determination of CCC's liability. Upon receipt in good order of 
the information and documents required under Sec. 1493.110, CCC will 
determine whether or not a loss has occurred for which CCC is liable 
under the applicable payment guarantee, this subpart and any applicable 
supplemental Program Announcements and Notices to Participants. If CCC 
determines that it is liable to the exporter and/or the exporter's 
assignee, CCC will pay the exporter or the exporter's assignee in 
accordance with paragraphs (b) and (c) of this section.
    (b) Amount of CCC's liability. CCC's maximum liability for any 
claims for loss submitted with respect to any payment guarantee, not 
including any late interest payments due in accordance with paragraph 
(c) of this section, will be limited to the lesser of:
    (1) The guaranteed value as stated in the payment guarantee, plus 
eligible interest; or
    (2) The guaranteed percentage (as indicated in the payment 
guarantee) of the exported value indicated in the evidence of export, 
plus eligible interest.
    (c) Late interest payment. If a claim is not paid within one day of 
receipt of a claim which CCC has determined to be in good order, late 
interest will accrue in favor of the exporter or the exporter's assignee 
beginning with the first day after the day of reciept of a claim found 
by CCC to be in good order and continuing until and including the date 
that payment is made by CCC. Late interest will be paid on the 
guaranteed amount, as determined by paragraphs (b)(1) and (2) of this 
section, and will be calculated based on the average investment rate of 
the most recent Treasury 91-day bill auction as announced by the 
Department of Treasury as of the due date.
    (d) Accelerated payments. CCC will pay claims only for losses on 
amounts not paid as scheduled. CCC will not pay claims for amounts due 
under an accelerated payment clause in the export sales contract, the 
foreign bank's letter of credit, or any obligation owed by the foreign 
bank to the assignee U.S. financial institution which is related to the 
foreign bank's letter of credit issued in favor of the exporter, unless 
it is determined to be in the best interests of CCC by the Controller, 
CCC. Notwithstanding the foregoing, CCC at its option may declare the 
entire amount of the unpaid balance, plus accrued interest, in default 
and make payment to the exporter or the exporter's assignee in addition 
to such other claimed amount as may be due from CCC.
    (e) Action against the assignee. Notwithstanding any other provision 
in this subpart to the contrary, with regard to commodities covered by a 
payment guarantee, CCC will not hold the assignee responsible or take 
any action or raise any defense against the assignee for any action, 
omission, or statement by the exporter of which the assignee has no 
knowledge, provided that:
    (1) The exporter complies with the reporting requirements under 
Sec. 1493.80 and Sec. 1493.90, excluding post-export adjustments (i.e., 
corrections to evidence of export reports); and

[[Page 820]]

    (2) The exporter or the exporter's assignee furnishes the statements 
and documents specified in Sec. 1493.110.