[Code of Federal Regulations]
[Title 7, Volume 10]
[Revised as of January 1, 2008]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR1427.21]

[Page 517-518]
 
                          TITLE 7--AGRICULTURE
 
  CHAPTER XIV--COMMODITY CREDIT CORPORATION, DEPARTMENT OF AGRICULTURE
 
PART 1427_COTTON--Table of Contents
 
     Subpart A_Nonrecourse Cotton Loan and Loan Deficiency Payments
 
Sec. 1427.21  Settlement.

    (a) The settlement of loans shall be made by CCC on the basis of the 
quality and quantity of the cotton delivered to CCC by the producer or 
acquired by CCC.
    (b) Settlements made by CCC for eligible cotton which are acquired 
by CCC which are stored in an approved warehouse shall be made on the 
basis of the entries set forth on the applicable warehouse receipt and 
other accompanying documents.
    (c) If a producer does not pay CCC the amount due under a loan, CCC 
shall take title to the cotton as provided in Sec. 1427.7(b).
    (d) With respect to ELS cotton which is stored as provided in Sec. 
1427.10(e), settlement of loans shall be made based upon the 
determination of the quantity and quality made by CCC at the time of 
acceptance of the cotton by CCC at the warehouse designated by CCC as 
provided in Sec. 1427.18(k).
    (e) If CCC sells the commodity described in paragraph (a) of this 
section in settlement of the recourse loan, the sales proceeds shall be 
applied to the amount owed CCC by the producer. The producer shall be 
responsible for any costs incurred by CCC in completing the sale and CCC 
will deduct the amount of these costs from the sales proceeds. When CCC 
sells any cotton obtained by forfeiture under a marketing assistance 
loan, CCC will, in all instances, retain all proceeds obtained from the 
sale of the cotton and will not

[[Page 518]]

make any payment of any amount of such proceeds to any party, including 
the producer who had satisfied their obligation under the loan through 
forfeiture of the cotton to CCC.

[67 FR 64459, Oct. 18, 2002, as amended at 68 FR 49329, Aug. 18, 2003; 
71 FR 32427, June 6, 2006]